UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549





FORM 10-K





(Mark One)

|x | ANNUAL REPORT PURSUANT TO
    SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ----------------------------------------------------------------------------------------



For the fiscal year ended December 31,
2022



OR



| ̈ | TRANSITION REPORT PURSUANT
    TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | --------------------------------------------------------------------------------------------



For the transition period from                      to



Commission file number: 814-01154





AUDAX CREDIT BDC INC.

(Exact name of registrant as specified in its
charter)





|DELAWARE                                                                                               |  | 47-3039124                                                                  
|------------------------------------------------------------------------------------------------------ |  | ----------------------------------------------------------------------------
|(State
                                    or other jurisdiction of
    incorporation or organization) |  | (I.R.S.
                                    Employer
    Identification No.)



|101
    HUNTINGTON AVENUE                   |  |               
|------------------------------------------- |  | --------------
|BOSTON,
    MASSACHUSETTS                   |  | 02199         
|(Address
    of principal executive office) |  | (Zip
    Code)



(617) 859-1500

(Registrant’s telephone number, including
area code)



Securities registered pursuant to Section 12(b) of
the Act:



None



Securities registered pursuant to Section 12(g) of
the Act:



Common Stock, par value $0.001 per share

(Title of class)



Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ̈ No x



Indicate
by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ̈ No x



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 (or for such shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90 days.    Yesx        No    
 ̈



Indicate
by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted 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 such files).        Yes ̈ No      ̈



Indicate by check mark whether the registrant
is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company.
See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,”
and “emerging growth company” in Rule 12 b-2 of the Exchange Act.



|Large accelerated filer |  |  ̈ |  | Accelerated filer         |  |  ̈
|----------------------- |  | - |  | ------------------------- |  | -
|                        |  |   | 
|Non-accelerated filer   |  | x |  | Smaller reporting company |  |  ̈
|                        |  |   | 
|Emerging growth company |  | x |  |                           |  |  



If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ̈



Indicate
by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness
of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the
registered public accounting firm that prepared or issued its audit report. ̈



If securities are registered pursuant to Section 12(b) of the
Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error
to previously issued financial statements.  ̈



Indicate by check mark whether any of those error corrections are restatements that
required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the
relevant recovery period pursuant to §240.10D-1(b).  ̈



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



As
of December 31, 2022, there was no established public market for the registrant’s common stock. The registrant had
44,753,084 shares of common stock, par value $0.001 per share, issued and outstanding as of March 20, 2023.



Portions
of the registrant’s Proxy Statement for its 2023 Annual Meeting of Stockholders to be filed not later than 120 days after
the end of the fiscal year covered by this annual report on Form 10-K are incorporated by reference into Part III of this annual
report on Form 10-K.






















|AUDAX CREDIT BDC INC.
|---------------------
|TABLE OF CONTENTS    
|                     
|PART I:              
|                     
|Item 1.              
|Item 1A.             
|Item 1B.             
|Item 2.              
|Item 3.              
|Item 4.              
|                     
|PART II:             
|                     
|Item 5.              
|Item 6.              
|Item 7.              
|Item 7A.             
|Item 8.              
|Item 9.              
|Item 9A.             
|Item 9B.             
|                     
|PART III:            
|                     
|Item 10.             
|Item 11.             
|Item 12.             
|Item 13.             
|Item 14.             
|                     
|PART IV:             
|                     
|Item 15.             
|                     
|SIGNATURES           













Part I



In this annual report on Form 10-K, except where the context
suggests otherwise, the terms “we,” “us,” “our” and the “Company” refer to Audax Credit
BDC Inc. We refer to Audax Management Company (NY), LLC, our investment adviser, as our “Adviser,” and Audax Management Company,
LLC, our administrator, as our “Administrator.” The term “stockholders” refers to holders of our common stock,
$.001 par value per share, or the Common Stock. The term “Shares” refers to the shares of Common Stock.



ITEM 1. BUSINESS



Overview



Audax Credit BDC Inc. is a Delaware corporation
that was formed in January 2015. We are an externally managed, closed-end, non-diversified management investment company that has
elected to be treated as a business development company, or BDC, under the Investment Company Act of 1940, as amended, or the 1940 Act.
In addition, we have elected to be treated for federal income tax purposes as a regulated investment company, or RIC, under Subchapter
M of the Internal Revenue Code of 1986, as amended, or the Code.



Our investment objective is to generate current
income and, to a lesser extent, long-term capital appreciation. We intend to meet our investment objective by investing primarily in
senior secured debt of privately owned U.S. middle-market companies. For purposes of this annual report, we define “middle market
companies” to be companies that, in general, generate less than $500 million in annual revenue or less than $75 million of annual
earnings before interest, taxes, depreciation and amortization, or EBITDA. We intend to invest at least 80% of our net assets plus the
amount of any borrowings in “credit instruments,” which we define as any fixed income instruments.



Although we have no present intention of doing
so, we may decide to incur indebtedness for the purpose of funding investments and for general corporate purposes, which we refer to
as “leverage.” If we do incur leverage in the near term, we anticipate that it will be used in limited circumstances and
on a short-term basis for purposes such as funding distributions. As a BDC, we are limited in our use of leverage under the 1940 Act.
Specifically, as a BDC, and absent specific authorization by our Board of Directors or stockholders, we are only allowed to borrow amounts
such that our asset coverage meets the requirements of the 1940 Act, which is currently at least 200% after such borrowing. In determining
whether to use leverage, we will analyze the maturity, covenants and interest rate structure of the proposed borrowings, as well as the
risks of such borrowings within the context of our investment outlook and the impact of leverage on our investment portfolio. The amount
of any leverage that we will employ as a BDC will be subject to oversight by our Board of Directors.



We generate revenue in the form of interest on
the debt securities that we hold in our portfolio companies. The senior debt we invest in generally has stated terms of three to ten
years. Our senior debt investments generally bear interest at a floating rate. Interest on debt securities is generally payable quarterly
or semiannually. In some cases, some of our investments may provide for deferred interest payments or payment-in-kind, or PIK, interest.
The principal amount of the debt securities and any accrued but unpaid interest generally will become due at the maturity date. In addition,
we may generate revenue in the form of commitment and other fees in connection with transactions, although we do not expect to do so.
Original issue discount, or OID, as well as market discount and premium are accreted and amortized in determining our interest income.
We record any prepayment premiums on loans and debt securities as income.



Available Information



Our address is 101 Huntington Avenue, Boston, MA 02199. Our phone
number is (617) 859-1500, and our internet address is www.audaxcreditbdc.com.





2







Key Elements of Investment Strategy



We have implemented the following investment strategy:



| | · | invest
                                            primarily in first lien senior secured loans and selectively in second lien loans to privately
                                            owned U.S. middle-market companies to take advantage of what we perceive to be higher pricing,
                                            more attractive structures and lower volatility than other fixed income investments, including
                                            larger, broadly syndicated loans (which we define for purposes of this annual report to be,
                                            in general, loans to companies generating substantially more than $75 million of annual EBITDA);
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | utilize
                                            our Adviser’s investment team’s experience in middle-market debt investing; the
                                            senior team members average 30 years of middle-market debt investing experience through all
                                            phases of the credit cycle;
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | benefit
                                            from the broad deal sourcing capabilities and due diligence insights of the platform developed
                                            by our Adviser and its affiliates, which we refer to, collectively, as Audax Group, as well
                                            as Audax Group’s primary research model and expertise in investing at each level of
                                            the capital structure of portfolio companies;
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | perform
                                            thorough credit analyses on investment opportunities with a focus on principal preservation
                                            and downside protection;
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | build
                                            a diversified portfolio of investments by company and industry; and
| | - | ---------------------------------------------------------------------------------------------------------------------



| | · | rigorously
                                            monitor company and portfolio performance.
| | - | -------------------------------------------------------------------------------------------------



The Company lends directly to borrowers and generally
structures its investments to include fixed repayment schedules and extensive contractual rights and remedies. We generally focus on
cash-pay instruments that pay interest on a monthly or quarterly basis, typically with maturities of between five and seven years. Such
first lien senior secured loans typically do not include equity co-investments, warrants or PIK payment terms. However, to the extent
we invest in securities ranking more junior in a borrower’s capital structure, which is not a focus of our portfolio, such investments
may include some or all of these attributes. Any equity co-investments, warrants or PIK instruments we hold may involve certain risks
that are not applicable to the types of securities in which we typically invest. These risks include the possibility of being unsecured
with respect to our claim on such investments if the portfolio company were to go bankrupt or being paid less upon such bankruptcy than
we otherwise would have had such investment been in the form of a senior loan.



Like bank loans, most loans in which we invest
are not rated by any rating agency. If they were rated, they would be rated as below investment grade quality. Loans rated below investment
grade quality, which are often referred to as “junk” loans, are generally regarded as having predominantly speculative characteristics
and may carry a greater risk with respect to a borrower’s capacity to pay interest and repay principal. Therefore, our investments
may result in an above average amount of risk of volatility or loss of principal. To the extent we make investments with a deferred interest
feature such as market discount, debt instruments with PIK interest and OID securities, the higher interest rates on these investments
may reflect the payment deferral and an increased credit risk associated with such instruments.



We generally focus on investment opportunities
that have demonstrated stability in their revenues and EBITDA. We also generally make investments that demonstrate a historical as well
as projected ability to generate cash flow sufficient to service the contemplated leverage. Targeted investments typically rely upon
multiple sources of cash flow and do not depend upon a single product, customer, geography, regulation, or technology.



We typically require a pledge of all of the tangible
and intangible assets of borrowers as collateral to secure our loans. As a result, we and other lenders in such first lien senior secured
loans have a first priority secured claim with respect to all tangible and intangible assets of such borrowers, including the proceeds
of any sale of assets, should the borrower default on its obligations under such first lien senior secured loans. Any such claim ranks
senior or effectively senior in the capital structure of our borrowers, ahead of all junior, subordinated and/or unsecured creditors,
with respect to all tangible and intangible assets of such borrowers pledged as collateral to secure our loans.





3







Generally, our loans are priced primarily with
a floating interest rate, with interest rates calculated on the basis of a fixed interest rate spread over a specified base rate. While
the London Interbank Offered Rate, or LIBOR, is the most commonly used base rate, we also offer the prime rate as an option for borrowers.
Our loan pricing is influenced by several factors, including the industry of the borrower, the degree of leverage of our loan and of
the borrower’s overall capital structure, the equity contribution of the sponsor, if any, in the borrower’s capital, and
general market conditions. We typically also include in our loan terms a yield enhancement device commonly referred to as a “LIBOR
Floor.” This feature, which first appeared in the debt markets in 2008, sets a minimum rate to be used as the LIBOR or prime rate
component of the loan’s interest rate calculation. As of December 31, 2022, LIBOR Floors in our loan agreements ranged from
0.00% to 2.00% per annum. See “Item 1A. Risk Factors — Risks Related to our Investments — We are exposed to risks associated
with changes in interest rates” for more information regarding the anticipated transition away from LIBOR.



An additional component of return on the loans
we typically purchase is an upfront or closing fee. This yield enhancement could also come in the form of a discount to the purchase
price when we purchase loans in the secondary market. When in discount form, this component is a form of deferred income that we realize
over time or upon final repayment of the loan. Such OID or closing fees serve to enhance the return on our investments. As of December 31,
2022, market rates for fees or OID enhanced the annual rate of return on a loan over its stated interest rate by 0.40%.



We believe our proven deal sourcing capabilities,
combined with our focus on prudent lending practices, enable us to identify investments with the potential for attractive current returns
and downside protection. Our focus on the middle-market should create opportunities for us to invest in companies with more conservative
capital structures and higher historical recovery rates than those generally found in larger, broadly syndicated transactions.



Middle-Market Senior Loan Opportunities



Several factors drive the appeal of middle-market
senior loan investment opportunities:



Borrowers
are proven companies with limited access to capital. The U.S. middle-market companies in which we typically invest are
seasoned companies with attractive credit profiles, including a demonstrated history of positive earnings and free cash flow. For these
borrowers, however, their relatively smaller size often means they have difficulty accessing the high yield bond market or other public
capital markets.



Attractive
annualized returns. Because U.S. middle-market companies typically have fewer options to raise capital, we believe we
can earn higher yields on loans to such companies as compared to loans to larger companies in the broadly syndicated loan market. Accordingly,
we typically expect our middle-market loans to offer higher interest rate spreads, lower leverage levels, and higher historic recovery
rates than broadly syndicated loans.



More
favorable terms than broadly syndicated loans. We believe the market dynamics described above enable us to negotiate more
conservative loan structures, with lower leverage, than comparable broadly syndicated loans.



Floating
rate instruments. Middle-market loans are typically priced at a spread above LIBOR or another risk-free rate, with minimal
interest rate duration. We believe floating rate instruments provide our stockholders with a level of protection against any increase
in the general level of interest rates. In addition, LIBOR Floors offer protection in a low interest rate environment.



Low
correlation with public fixed income and equities. Based on the historical performance of middle-market loan indices,
we expect that our portfolio will have a relatively low correlation with the returns of public fixed income and public equities indexes.





4







Favorable
position in capital structure with downside protection. First lien senior secured loans of the type we typically invest
in have a favorable position at the top of the borrower’s capital structure. In addition, such loans are typically secured by a
first priority lien on the assets of the borrowers. These factors should increase our recovery in the event of a loan default.



We believe the returns we can generate from current
yield, fees, and/or OID on senior secured loans in the current credit market environment are attractive on a risk-adjusted basis and
a historical basis. We also believe the changing dynamics of the lending environment over the past several years have made lending to
U.S. middle-market companies an increasingly attractive investment opportunity. A multi-year trend of consolidation in the U.S. banking
sector has resulted in fewer traditional lenders focused on lending to middle-market companies. As the banking industry has consolidated,
banks have grown larger, and we believe the remaining banks have focused their lending activities on larger, broadly syndicated transactions
to achieve the revenue and operating requirements due to their scale.



Compounding the impact of bank consolidation for
U.S. middle-market borrowers, several large independent specialty finance lenders have been acquired or have exited the business. Furthermore,
we believe that banks have come to depend more on the activities of private equity groups to generate leveraged loan activity. As the
number and size of private equity funds has grown, the size of leveraged buyout transactions and related financing arrangements have
increased commensurately. This has contributed, in turn, to pressure on banks to seek ever-larger transactions to generate fees and increase
demand for other banking services.



We believe the focus of many senior loan investment
strategies and of high yield managers with bank loan allocations is to acquire easily accessible broadly syndicated loans. Below we outline
the key distinctions between middle-market loans and broadly syndicated loans.



Middle-market
loans generally earn a premium over broadly syndicated loans. From January 2000 through December 2022, the loan
spread premium of middle-market loans over broadly syndicated loans ranged between -5 basis points and 209 basis points. Over that same
period, the average spread of middle-market loans was 109 basis points higher than the average spread of broadly syndicated loans. As
of December 31, 2022, the interest rate spread gap was near historically wide levels, with middle-market loans earning on average
189 basis points more than broadly syndicated loans during the twelve months ended December 31, 2022.



Middle-market
loans generally benefit from lower leverage. Since the beginning of 1997 through the end of 2022, the difference in the
ratio of total debt to EBITDA for middle-market and broadly syndicated loans generally ranged between 0.1x and 0.9x. On average, the
total debt to EBITDA ratio for middle-market loans was 0.5x lower than broadly syndicated loans during that 26-year period.



Competition



Our primary competitors in providing financing
to middle-market companies include public and private funds, other BDCs, commercial and investment banks, commercial finance companies
and, to the extent they provide an alternative form of financing, private equity, mezzanine and hedge funds, as well as issuers of collateral
loan obligations and other structured loan funds. Many of our competitors are substantially larger and have considerably greater financial,
technical and marketing resources than we do. For example, some competitors have a lower cost of funds and access to funding sources
that are not available to us. Our competitors have incurred, or may in the future incur, leverage to finance their debt investments at
levels or on terms more favorable than those available to us. In addition, some of our competitors have higher risk tolerances or different
risk assessments than we do, which allows them to consider a wider variety of investments and establish more relationships than us. Furthermore,
many of our potential competitors are not subject to the regulatory restrictions that the 1940 Act imposes and the Code impose on us.
We cannot assure you that the competitive pressures we face will not have a material adverse effect on our business, financial condition
and results of operations. Also, as a result of this competition, we may not be able to take advantage of attractive investment opportunities
from time to time, and we can offer no assurance that we will be able to identify and make investments that are consistent with our investment
objective.





5







Among other factors, the returns on investments
available in the marketplace are a function of the supply of investment opportunities and the amount of capital investing in such opportunities.
Strong competition for investments could result in fewer investment opportunities for us, as our competitors may establish investment
vehicles that target the same or similar investments that we typically purchase. Moreover, identifying attractive investment opportunities
is difficult and involves a high degree of uncertainty.



Audax Management Company (NY), LLC



In its investment process, our Adviser utilizes
a business model in which credit analysis is the priority throughout all processes, including deal sourcing, underwriting, and portfolio
management. We utilize our Adviser’s seasoned team and operating platform to identify compelling investment opportunities for us.
We then evaluate these opportunities through an investment approach that emphasizes strong fundamental credit analysis and rigorous portfolio
monitoring. We are disciplined in selecting investments and focusing on opportunities that we perceive offer favorable risk/reward characteristics.



Our Adviser seeks to diversify our portfolio by
company type, asset type, investment size and industry.



The principals of our Adviser who are responsible
for its senior debt advisory activities have worked together at Audax Group and previously at General Electric Capital Corporation for
more than 21 years, during which time they have focused on investing in senior debt issued by private middle-market companies and have
invested in excess of $26.3 billion through multiple cycles. We believe that we benefit from our Adviser’s experience in originating
investments for us and, (to the extent permitted by the 1940 Act and the exemptive relief that we and the Adviser have been granted from
the U.S. Securities and Exchange Commission, or the SEC), co-investment opportunities.



From its inception in 2007 through the end of
December 31, 2022, the senior debt business of our Adviser, or Audax Senior Debt, invested $26.3 billion of capital primarily in
senior secured debt investments with selective investments in mezzanine debt and equity.



Competitive Strengths



Experienced
Team and Extensive Sourcing Network. We believe that Audax Senior Debt has a competitive advantage over its middle-market
investing peers given the breadth of the Audax Group platform. As part of Audax Group, Audax Senior Debt benefits from the industry-specific
knowledge, extensive middle-market business relationships and established deal sourcing capabilities across the firm. In the aggregate,
Audax Senior Debt, as well as the origination and private equity businesses of Audax Group, together held investments in over 455 middle-market
companies across a wide variety of industries as of December 31, 2022.



Specifically, we believe Audax Senior Debt and
the Audax Group platform provide advantages in sourcing transactions, accessing proprietary due diligence (subject to applicable confidentiality
obligations), and leveraging the lengthy investing experience of the senior members of the Audax Group investment team.



| | · | Sourcing—Audax
                                            Group’s mezzanine and private equity teams often get an early look at prospective middle-market
                                            merger and acquisition, or M&A, transactions in the early stages of a sale process. Given
                                            this early insight into middle-market sale transactions, our Adviser can often evaluate investment
                                            opportunities before many of its competitors. Since most of these M&A transactions have
                                            a senior debt component, we believe the Adviser’s investment team often becomes aware
                                            of senior debt lending opportunities well before other firms.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Due
                                            diligence—As of December 31, 2022, Audax Group held over 455 portfolio companies
                                            across three investment businesses. Audax Senior Debt typically has direct, proprietary access
                                            to the relevant management teams, which can provide industry insights and primary research
                                            capabilities. This helps the Adviser make more informed investment decisions.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





6







| | · | Investing
                                            experience—As of December 31, 2022, the Co-CEOs and 44 Managing Directors
                                            of Audax Group’s debt and equity investing businesses had an average of 23 years of
                                            experience. They have successfully invested through numerous economic cycles.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The Adviser’s sourcing processes and robust
deal flow have enabled Audax Senior Debt to be selective and apply rigorous credit analysis on the investment opportunities it reviews.
From Audax Senior Debt’s inception in December 2007 through December 31, 2022, the Audax Group platform sourced 8,761
senior debt investment opportunities and invested $26.3 billion in 914 investments (10% of opportunities sourced).



Audax
Senior Debt has invested in loans with lower leverage and higher spreads. Audax Senior Debt has been able to take advantage
of opportunities in the market for middle-market senior loans by sourcing and underwriting investments with lower leverage and higher
spreads than other middle-market transactions. From inception in 2007 through December 31, 2022, investment vehicles managed by
Audax Senior Debt invested in new issue loans that had an average first lien debt multiple, which compares the principal amount of the
Company’s loan and any other outstanding first-lien debt of the borrower to the borrower’s EBITDA, of 4.69x and an average
interest rate spread of 4.79%, which is the difference between the interest rate on the Company’s loan and the interest rate on
the comparable risk-free instrument, typically the three-month LIBOR. We believe both of these measures compare favorably to broadly
syndicated and other middle-market loans that have come to market during the same period.



Audax
Group Platform. In addition to a large, seasoned team of investment professionals, our Adviser and its affiliates employ
specialized professionals with expertise in transaction sourcing, capital markets, legal issues, and tax planning. We believe the Audax
Group platform’s size, collective knowledge base, and shared experience provide a competitive advantage in middle-market lending.



Investment Process



We believe our Adviser has a disciplined and repeatable
process for executing, monitoring, structuring and exiting investments. We believe the primary driver of stable, consistent returns in
a senior loan portfolio is the preservation of invested capital. To accomplish this objective, our Adviser utilizes a business model
where credit analysis is the priority throughout all stages of the investment process, including deal sourcing, underwriting, and portfolio
management. We evaluate each investment opportunity by analyzing each borrower’s industry dynamics, quality and sustainability
of earnings, management team, and capital structure.



Our Adviser focuses on credit evaluation throughout the investment
process.



Initial
Screening Process. Once a potential transaction is sourced, it undergoes an initial screen to determine the suitability
of the investment. This assessment includes a review of the borrower’s industry and its relative position within that industry,
as well as transaction-specific items such as the proposed capital structure, deal size, and expected pricing. If the results of this
initial screen are positive, the next step is to proceed with detailed transaction due diligence analysis.



Transaction
Underwriting. When analyzing a possible transaction, our Adviser identifies and evaluates numerous investment criteria.
While these criteria are likely to be different for each investment, in general the analysis includes an in-depth review of the borrower’s
industry and the underlying dynamics within that industry. The Adviser reviews numerous borrower-specific criteria such as the quality
and depth of the management team, products, and end markets. Our Adviser undertakes an extensive financial analysis, including a review
of historical results and projected performance. The Adviser’s investment team also scrutinizes the specific characteristics of
each investment, including transaction structure, investment collateral, overall transaction economics, and the maturity of the contemplated
facilities. Our Adviser seeks to invest in companies having the following criteria, although not all portfolio companies will meet all
of these criteria.



Portfolio
Management. The Adviser reviews investment performance on a regular basis to evaluate whether each investment is delivering
the expected results. For each investment, portfolio monitoring processes measure the borrower’s current and projected financial
performance versus historical performance, with emphasis on financial results since the funding of the investment. As part of the Adviser’s
financial performance evaluation, it monitors, among other items, the borrower’s historical, current and projected covenant compliance.
Additionally, the Adviser maintains communication with other lenders, borrowers, and sponsors, and manages any amendments or waivers
on our behalf.





7







Industry
Dynamics. The Adviser evaluates criteria such as market size, participants, and barriers to entry, as well as the competitive
position of the potential borrower. We invest in established businesses with leading market positions that the Adviser believes are defensible
against potential new entrants and that demonstrate strong potential for organic growth. Attributes of targeted investments may include
low-cost manufacturing, product expertise, proprietary technology or distribution capability, and strong customer relationships.



Quality
and Sustainability of Earnings. We generally focus on investment opportunities that have demonstrated stability in their
revenues and EBITDA. We typically invest in companies that demonstrate a historical as well as projected ability to generate cash flow
sufficient to service the contemplated leverage. Targeted investments typically rely upon multiple sources of cash flow and do not depend
upon a single product, customer, geography, regulation, or technology.



Company
Management. We invest in companies where senior management teams have demonstrated operating experience. Borrowers’
management teams are expected to play a key role in growing their businesses, to have a firm grasp on the competitive dynamics and business
trends affecting their industries, to have demonstrated an ability to manage costs, and to have a well-defined vision and strategy for
their company’s future success.



Capital
Structure. Appropriate capitalization is a critical factor in a company’s ability to weather economic, industry,
or company-specific downturns. Therefore, we seek to invest in transactions that are prudently leveraged relative to a company’s
current and projected cash flow generating capability and underlying asset and enterprise value. Our Adviser’s due diligence focuses
on industry dynamics and a company’s future cash needs. Key metrics that the Adviser generally reviews when analyzing capitalization
include:



| | · | leverage
                                            ratios with respect to senior debt and total debt;
| | - | -------------------------------------------------------------------------------------------------------



| | · | interest
                                            expense coverage ratios, which measure the ability of the company to pay interest on its
                                            debt obligations; and
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | fixed
                                            charge coverage ratios, which measure the ability of the company to service annual financial
                                            obligations, including interest expense, loan principal payments, and capital expenditures.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Investments



We seek to create a portfolio that is primarily
composed of first lien senior secured loans and select unitranche and second lien loans by making investments generally in the range
of $1.0 million to $5.0 million in privately owned, U.S.-based middle-market companies. Set forth below is a list of our ten largest
investments as of December 31, 2022 and 2021, as well as the top ten industries in which we were invested as of December 31,
2022 and 2021, in each case calculated as a percentage of our total investments at fair value as of such dates.





8







|                             |  | December 31,
    2022 |           
|---------------------------- |  | --------------------- | ----------
|Portfolio
    Company        |  | Fair Value            |           
|InMark                       |  | $                     | 6,419,952 
|American Vision Partners     |  |                       | 4,856,470 
|StandardAero 2019            |  |                       | 4,758,240 
|Cerity Partners 2022         |  |                       | 4,570,390 
|LegalShield 2021             |  |                       | 4,305,152 
|InnovateMR                   |  |                       | 4,200,101 
|RevHealth                    |  |                       | 4,150,791 
|Floworks                     |  |                       | 3,980,000 
|Tank Holdings                |  |                       | 3,970,050 
|Alliance Environmental Group |  |                       | 3,959,048 
|                             |  | $                     | 45,170,195



|                        |  | December 31,
    2021 |           
|----------------------- |  | --------------------- | ----------
|Portfolio Company       |  | Fair Value            |           
|CPI International 2019  |  | $                     | 5,222,307 
|StandardAero 2019       |  |                       | 4,916,845 
|DuBois Chemicals 2019   |  |                       | 4,748,920 
|LegalShield 2021        |  |                       | 4,496,243 
|Bettcher Industries     |  |                       | 4,455,000 
|InnovateMR              |  |                       | 4,172,974 
|Radiology Partners 2018 |  |                       | 4,168,780 
|Advarra                 |  |                       | 4,145,626 
|Veritext                |  |                       | 4,102,154 
|Confluence Technologies |  |                       | 3,980,000 
|                        |  | $                     | 44,408,849



|                                          |  | December 31,
    2022 |            
|----------------------------------------- |  | --------------------- | -----------
|Industry                                  |  | Fair Value            |            
|Healthcare & Pharmaceuticals              |  | $                     | 74,735,672 
|Services: Business                        |  |                       | 69,269,858 
|High Tech Industries                      |  |                       | 51,379,328 
|Containers, Packaging & Glass             |  |                       | 33,987,694 
|Banking, Finance, Insurance & Real Estate |  |                       | 32,865,053 
|Capital Equipment                         |  |                       | 28,019,443 
|Aerospace & Defense                       |  |                       | 21,269,972 
|Chemicals, Plastics & Rubber              |  |                       | 19,080,225 
|Transportation: Cargo                     |  |                       | 13,798,595 
|Services: Consumer                        |  |                       | 13,773,067 
|                                          |  | $                     | 358,178,907



|                                          |  | December 31,
    2021 |            
|----------------------------------------- |  | --------------------- | -----------
|Industry                                  |  | Fair Value            |            
|Healthcare & Pharmaceuticals              |  | $                     | 76,579,770 
|Services: Business                        |  |                       | 63,977,738 
|High Tech Industries                      |  |                       | 49,862,684 
|Containers, Packaging & Glass             |  |                       | 28,958,289 
|Banking, Finance, Insurance & Real Estate |  |                       | 25,369,331 
|Chemicals, Plastics & Rubber              |  |                       | 24,290,294 
|Aerospace & Defense                       |  |                       | 24,066,376 
|Capital Equipment                         |  |                       | 17,471,742 
|Services: Consumer                        |  |                       | 16,280,215 
|Transportation: Cargo                     |  |                       | 13,941,799 
|                                          |  | $                     | 340,798,238





9







Investment Committee



The purpose of our Adviser’s investment
committee, or the Investment Committee, is to evaluate and approve all investments by our Adviser. The Investment Committee includes
Michael McGonigle, Kevin Magid, Geoffrey Rehnert and Marc Wolpow. The Investment Committee review process is intended to bring the diverse
experience and perspectives of the committee members to the analysis and consideration of every investment. We believe this process provides
consistency to our Adviser’s investment philosophy and policies. The Investment Committee also determines appropriate investment
size and mandates ongoing monitoring requirements. No member of the Investment Committee serves as the lead portfolio manager, and its
members are equally responsible for the management of the Company’s portfolio.



In addition to reviewing
investments, the Investment Committee meetings serve as a forum to discuss credit views and outlooks. Potential transactions and deal
flow are also reviewed on a regular basis. Members of the Investment Committee are encouraged to share information and views on credits
with the committee early in their analysis. This process improves the quality of the analysis and enables the deal team members to work
more efficiently.



Investment Committee Compensation



The compensation of the members of the Investment
Committee paid by our Adviser includes an annual base salary, in certain cases an annual bonus based on an assessment of short-term and
long-term performance, and a portion of the incentive fees, including the Incentive Fee (if any), to be paid to our Adviser, determined
on the same basis as the annual bonus. In addition, certain of our Investment Committee members that are not on our Board of Directors
have equity interests in our Adviser and Administrator, and may receive distributions of profits in respect of those interests.



Operating and Regulatory Structure



We have elected to be treated as a BDC under the
1940 Act. As a BDC, we are generally prohibited from acquiring assets other than qualifying assets unless, after giving effect to any
acquisition, at least 70% of our total assets are qualifying assets. Qualifying assets generally include securities of eligible portfolio
companies, cash, cash equivalents, U.S. government securities and high-quality debt instruments maturing in one year or less from the
time of investment. Under the rules of the 1940 Act, “eligible portfolio companies” include (i) private U.S. operating
companies, (ii) public U.S. operating companies whose securities are not listed on a national securities exchange (e.g., the New
York Stock Exchange) or registered under the Securities Exchange Act of 1934, as amended, or the Exchange Act, and (iii) public
U.S. operating companies having a market capitalization of less than $250 million. Public U.S. operating companies whose securities are
quoted on the over-the-counter bulletin board and through OTC Markets Group Inc. are not listed on a national securities exchange and
therefore are eligible portfolio companies.



We have elected to be treated as a RIC under Subchapter
M of the Code. As a RIC, we generally are not subject to corporate-level U.S. federal income taxes on any ordinary income or capital
gains that we distribute as dividends to our stockholders. To qualify and maintain our qualification as a RIC, we must, among other things,
meet certain source-of-income, distribution and asset diversification requirements. We intend to timely distribute to our stockholders
substantially all of our taxable income each taxable year, except that we may retain all or a portion of our net capital gains for reinvestment
and, depending upon the level of taxable income earned in a taxable year, we may choose to carry forward all or a portion of our taxable
income for distribution in the following taxable year and incur any applicable U.S. federal excise tax.



Risk Management



Broad
Diversification. We have diversified and intend to continue to diversify our transactions by company, asset type, investment
size, industry and geography within the United States. Once we have fully invested the proceeds from any offering of the Shares, we expect
that each individual investment will not exceed approximately five percent of our total assets and that the size of our individual investments
will vary proportionately with the size of our capital base. Furthermore, we must meet certain diversification tests in order to qualify
as a RIC for U.S. federal income tax purposes. See “Item 1. Business — Material U.S. Federal Income Tax Considerations.”





10







Rigorous
Due Diligence. As noted above, our Adviser’s systematic underwriting process involves exhaustive in-house due diligence,
applicable third-party consulting reports and multiple stages of investment approval, with a goal of risk mitigation during and after
transaction execution.



Administrator



We have entered into an administration agreement,
or the Administration Agreement, with Audax Management Company, LLC, who serves as our Administrator and provides us with office space,
office services and equipment. The responsibilities of our Administrator include overseeing our financial records, preparing reports
to our investors and, as applicable, reports filed with the SEC. Our Administrator also generally monitors the payment of our expenses
and the performance of administrative and professional services rendered to us by others. Our Administrator is reimbursed for certain
administrative expenses it incurs on our behalf, and has entered into a fee waiver agreement with us pursuant to which the Administrator
may waive, in whole or in part, its entitlement to receive reimbursements from us. The Adviser is a wholly-owned subsidiary of our Administrator.



License Agreement



We have entered into a license agreement with
an affiliate of the Adviser pursuant to which such affiliate has granted us a non-exclusive, royalty-free license to use the name “Audax”
for specified purposes in our business. Under this agreement, we have a right to use the “Audax” name, subject to certain
conditions, for so long as our Adviser or one of its affiliates remains our investment adviser. Other than with respect to this limited
license, we have no legal right to the “Audax” name.



Investment Advisory Agreement



We have entered into an investment advisory agreement,
or the Investment Advisory Agreement, with our Adviser. Pursuant to the Investment Advisory Agreement, we pay our Adviser a fee for investment
advisory and management services consisting of two components — a base management fee and an Incentive Fee. Our Adviser may, from
time-to-time, grant waivers on our obligations, including waivers of the base management fee and/or Incentive Fee, under the Investment
Advisory Agreement. We also entered into a management fee waiver agreement with our Adviser on July 8, 2015, or the Waiver Agreement,
which we or the Adviser may terminate upon 60 days’ prior written notice.



Base Management Fee



The base management fee is calculated at an annual
rate of 1.00% of the value of our gross assets. Pursuant to the Waiver Agreement, the Adviser has agreed to waive the right to receive
the base management fee to the extent necessary so that the base management fee payable under the Investment Advisory Agreement equals,
and is calculated in the same manner as if, the base management fee otherwise payable by the Company were calculated at an annual rate
equal to 0.65% (instead of an annual rate of 1.00%).



Incentive Fee



The Incentive Fee has two parts: The first part
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 (including
any other fees (other than fees for providing managerial assistance), such as commitment, origination, structuring, diligence and consulting
fees or other fees that we receive from portfolio companies) accrued during the calendar quarter, minus our operating expenses accrued
for the quarter (including the base management fee, expenses payable under the Administration Agreement, and any interest expense on
any credit facilities or outstanding debt and dividends paid on any issued and outstanding preferred stock, but excluding the Incentive
Fee).





11







Incentive Fee on Pre-Incentive Fee Net Investment Income



We determine pre-incentive fee net investment
income in accordance with U.S. Generally Accepted Accounting Principles, or GAAP, including, in the case of investments with a
deferred interest feature, such as OID, debt instruments with PIK, interest and zero coupon securities, accrued income that 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 appreciation or 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
1.0% per quarter (4.0% annualized). We determine our average gross assets during each fiscal quarter and calculate the base
management fee payable with respect to such amount at the end of each fiscal quarter. As a result, a portion of our net investment
income is included in our gross assets for the period between the date on which such income is earned and the date on which such
income is distributed. Therefore, our net investment income used to calculate part of the Incentive Fee is also included in the
amount of our gross assets used to calculate the 1.0% annual base management fee. We pay our Adviser an Incentive Fee with respect
to our pre-incentive fee net investment income in each calendar quarter as follows:



| | · | no
                                            amount is paid on the income-portion of the Incentive Fee in any calendar quarter in which
                                            our pre-incentive fee net investment income does not exceed the hurdle of 1.0% (4.0% annualized);
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | 100.0%
                                            of our 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 rate but is less than 1.1765 %
                                            in any calendar quarter (4.706% annualized). We refer to this portion of our pre-incentive
                                            fee net investment income (which exceeds the hurdle rate but is less than 1.1765%) as the
                                            “catch-up” provision. The catch-up is meant to provide our Adviser with 15.0%
                                            of the pre-incentive fee net investment income as if a hurdle rate did not apply if this
                                            net investment income exceeds 1.1765% in any calendar quarter (4.706% annualized); and
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | 15.0%
                                            of the amount of our pre-incentive fee net investment income, if any, that exceeds 1.1765%
                                            in any calendar quarter (4.706% annualized) is payable to our Adviser.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The following is a graphical representation of the calculation of
the income-related portion of the Incentive Fee on a quarterly basis:



Pre-incentive Fee Net Investment Income

(expressed as a percentage of the value of
net assets)







Percentage of pre-incentive
fee net investment income allocated to our Adviser



These calculations are pro-rated for any period
of less than three months and adjusted for any Share issuances or repurchases during the relevant quarter. You should be aware that a
rise in the general level of interest rates can be expected to lead to higher interest rates applicable to our debt investments. Accordingly,
an increase in interest rates would make it easier for us to meet or exceed the hurdle rate and may result in a substantial increase
of the amount of Incentive Fees payable to our Adviser with respect to pre-incentive fee net investment income.



Pursuant to the Waiver Agreement, the Adviser
has agreed to waive its right to receive the Incentive Fee on pre-incentive fee net investment income to the extent necessary so that
such Incentive Fee equals, and is calculated in the same manner as, the corresponding Incentive Fee on pre-incentive fee net investment
income, if such Incentive Fee (i) were calculated based upon the Adviser receiving 10% (instead of 15%) of the applicable pre-incentive
fee net investment income and (ii) did not include any “catch-up” feature in favor of the Adviser.





12







Incentive Fee on Capital Gains



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 equals 15% of our realized capital gains, if any, on a cumulative basis
from June 16, 2015, the date of effectiveness of our registration statementon Form 10 (file no. 000-55426), or the
Registration Statement, through the end of each calendar year, computed net of all realized capital losses and unrealized capital depreciation
on a cumulative basis, less the aggregate amount of any previously paid capital gain Incentive Fees with respect to each of the investments
in our portfolio.



Pursuant to the Waiver Agreement, the Adviser
has agreed to waive the right to receive the Incentive Fee on capital gains to the extent necessary so that such portion of the Incentive
Fee equals, and is calculated in the same manner as, the corresponding Incentive Fee on capital gains, if such portion of the Incentive
Fee were calculated based upon the Adviser receiving 10% (instead of 15%).



In addition, pursuant to the Waiver Agreement,
the Adviser has agreed to waive the right to receive both components of the Incentive Fee to the extent necessary so that it does not
receive Incentive Fees which are attributable to income and gains of the Company that exceed an annualized rate of 12% in any calendar
quarter.



The sum of the incentive fee on pre-incentive
fee net investment income and incentive fee on capital gains is the Incentive Fee.



Examples of Quarterly Incentive Fee Calculation



Example 1: Income Related Portion of Incentive Fee (*):



Alternative 1

Assumptions

Investment income (including interest, dividends, fees, etc.)
= 1.0%

Hurdle
rate(1) = 1.0%

Management
fee(2) = 0.25%

Other
expenses (legal, accounting, custodian, transfer agent, etc.)(3) = 0.15%

Pre-incentive fee net investment income

(investment income – (management
fee + other expenses)) = 0.60%

Pre-incentive net investment income does not exceed hurdle
rate, therefore there is no incentive fee.



Alternative 2

Assumptions

Investment income (including interest, dividends, fees, etc.)
= 1.5%

Hurdle
rate(1) = 1.0%

Management
fee(2) = 0.25%

Other
expenses (legal, accounting, custodian, transfer agent, etc.)(3) = 0.15%

Pre-incentive fee net investment income

(investment income – (management
fee + other expenses)) = 1.1%, which exceeds the hurdle rate



Incentive fee = 15% × pre-incentive fee net investment
income, subject to the “catch-up”(4)

=
100% x (1.10%- 1.0%)

=
0.10%





13







Alternative 3

Assumptions

Investment income (including interest, dividends, fees, etc.)
= 2.0%

Hurdle
rate(1)= 1.0%

Management
fee(2)= 0.25%

Other expenses (legal, accounting, custodian, transfer
agent, etc.)(3) = 0.15%

Pre-incentive fee net investment income

(investment income – (management fee + other expenses))
= 1.60%

Incentive fee            =
15% × pre-incentive fee net investment income, subject to “catch-up”(4)

= 100% × “catch-up” + (15% × (pre-incentive fee net investment income –1.1765%))



Catch-up                 
= 1.1765% – 1.0% = 0.1765%



Incentive fee          
= (100% × 0.1765%) + (15% × (1.60% –1.1765%))

=
0.1765% + (15% × 0.4235%)

=
0.1765% + 0.063525%

=
0.24%










| | (*) | The
hypothetical amount of pre-incentive fee net investment income shown is based on a percentage of total net assets.
| | --- | ----------------------------------------------------------------------------------------------------------------------

| | (1) | Represents
4.0% annualized hurdle rate.
| | --- | ---------------------------------------

| | (2) | Represents
1% annualized management fee.
| | --- | ----------------------------------------

| | (3) | Excludes
organizational and offering expenses.
| | --- | ----------------------------------------------

| | (4) | The
 “catch-up” provision is intended to provide our Adviser with an Incentive Fee of approximately 15.0% on all of our pre-incentive
fee net  investment income as if a hurdle rate did not apply when our net investment income exceeds 1.1765% in any calendar
quarter (4.706% annualized).
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Example 2: Capital Gains Portion of Incentive Fee:



Alternative 1

Assumptions



| | · | Year
                                            1: $20 million investment made in Company A (“Investment A”), and $30 million
                                            investment made in Company B (“Investment B”)
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Year
                                            2: Investment A sold for $50 million and fair market value (“FMV”) of Investment
                                            B determined to be $32 million
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Year
                                            3: FMV of Investment B determined to be $25 million
| | - | ----------------------------------------------------------------------------------------------------



| | · | Year
                                            4: Investment B sold for $31 million
| | - | -------------------------------------------------------------------------------------



The capital gains portion of the Incentive Fee, if any, would be:



| | · | Year
                                            1: None
| | - | --------------------------------------------------------



| | · | Year
                                            2: $4.5 million capital gains incentive fee
| | - | --------------------------------------------------------------------------------------------



$30 million realized capital gains
on sale of Investment A multiplied by 15%



| | · | Year
                                            3: None
| | - | --------------------------------------------------------



$3.75 million cumulative fee (15% multiplied by $25 million
($30 million cumulative capital gains less $5 million cumulative capital depreciation)) less $4.5 million (previous capital gains fee
paid in Year 2)



| | · | Year
                                            4: $150,000 capital gains incentive fee
| | - | ----------------------------------------------------------------------------------------



$4.65 million cumulative fee ($31 million cumulative realized
capital gains multiplied by 15%) less $4.5 million (previous capital gains fee paid in Year 2)





14







Alternative 2

Assumptions



| | · | Year
                                            1: $20 million investment made in Company A (“Investment A”), $30 million investment
                                            made in Company B (“Investment B”) and $25 million investment made in Company
                                            C (“Investment C”)
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Year
                                            2: Investment A sold for $50 million, FMV of Investment B determined to be $25 million and
                                            FMV of Investment C determined to be $25 million
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Year
                                            3: FMV of Investment B determined to be $27 million and Investment C sold for $30 million
| | - | ------------------------------------------------------------------------------------------------------------------------------------------



| | · | Year
                                            4: FMV of Investment B determined to be $35 million
| | - | ----------------------------------------------------------------------------------------------------



| | · | Year
                                            5: Investment B sold for $20 million
| | - | -------------------------------------------------------------------------------------



The capital gains portion of the Incentive Fee, if any, would be:



| | · | Year
                                            1: None
| | - | --------------------------------------------------------



| | · | Year
                                            2: $3.75 million capital gains incentive fee
| | - | ---------------------------------------------------------------------------------------------



15% multiplied by $25 million ($30 million realized capital
gains on sale of Investment A less $5 million unrealized capital depreciation on Investment B)



| | · | Year
                                            3: $1,050,000 capital gains incentive fee
| | - | ------------------------------------------------------------------------------------------



$4.8 million cumulative fee (15% multiplied by $32 million
($35 million cumulative realized capital gains less $3 million unrealized capital depreciation)) less $3.75 million (previous capital
gains fee paid in Year 2)



| | · | Year
                                            4: None
| | - | --------------------------------------------------------



| | · | Year
                                            5: None
| | - | --------------------------------------------------------



$3.75 million cumulative fee (15% multiplied by $25 million
($35 million cumulative realized capital gains less $10 million realized capital losses)) less $4.8 million (previous cumulative capital
gains fee paid in Year 2 and Year 3)



Valuation of Investments



We conduct the valuation of our investments, pursuant
to which our net asset value is determined, at all times consistent with GAAP and the 1940 Act. Our Board of Directors, with the assistance
of our Audit Committee, determines the fair value of our investments, for investments with a public market and for investments with no
readily available public market, on at least a quarterly basis, in accordance with the terms of ASC 820. Our valuation procedures are
set forth in more detail below.



ASC 820 defines fair value 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.” Fair value is a market-based measurement, not an entity-specific measurement. For some assets and liabilities,
observable market transactions or market information might be available. For other assets and liabilities, observable market transactions
and market information might not be available. However, the objective of a fair value measurement in both cases is the same – to
estimate the price when an orderly transaction to sell the asset or transfer the liability would take place between market participants
at the measurement date under current market conditions (that is, an exit price at the measurement date from the perspective of a market
participant that holds the asset or owes the liability).



ASC 820 establishes a hierarchal disclosure framework
which ranks the observability of inputs used in measuring financial instruments at fair value. The observability of inputs is impacted
by a number of factors, including the type of financial instruments and their specific characteristics. Financial instruments with readily
available quoted prices, or for which fair value can be measured from quoted prices in active markets, generally will have a higher degree
of market price observability and a lesser degree of judgment applied in determining fair value.



The three-level hierarchy for fair value measurement
is defined as follows:



Level
1— Inputs to the valuation methodology are quoted prices available in active markets for identical financial instruments
as of the measurement date. The types of financial instruments in this category include unrestricted securities, including equities and
derivatives, listed in active markets. We do not adjust the quoted price for these instruments, even in situations where we hold a large
position, and a sale could reasonably be expected to impact the quoted price.



Level
2— Inputs to the valuation methodology are quoted prices in markets that are not active or for which all significant
inputs are either directly or indirectly observable as of the measurement date. The types of financial instruments in this category include
less liquid and restricted securities listed in active markets, securities traded in markets that are not active, government and agency
securities, and certain over-the-counter derivatives where the fair value is based on observable inputs.





15







Level
3— Inputs to the valuation methodology are unobservable and significant to the overall fair value measurement, and
include situations where there is little, if any, market activity for the investment. The inputs into the determination of fair value
require significant management judgment or estimation. The types of financial instruments in this category include investments in privately
held entities, non-investment grade residual interests in securitizations, collateralized loan obligations, and certain over-the-counter
derivatives where the fair value is based on unobservable inputs.



In certain cases, the inputs used to measure fair
value may fall into different levels of the fair value hierarchy. In such cases, the determination of which category within the fair
value hierarchy is appropriate for any given financial instrument is based on the lowest level of input that is significant to the fair
value measurement. Assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment
and considers factors specific to the financial instrument.



Pursuant to the framework set forth above, we
value securities traded in active markets on the measurement date by multiplying the exchange closing price of such traded securities/instruments
by the quantity of shares or amount of the instrument held. We may also obtain quotes with respect to certain of our investments from
pricing services, brokers or dealers’ quotes, or counterparty marks in order to value liquid assets that are not traded in active
markets.



Pricing services aggregate, evaluate and report
pricing from a variety of sources including observed trades of identical or similar securities, broker or dealer quotes, model-based
valuations and internal fundamental analysis and research. When doing so, we determine whether the quote obtained is sufficient according
to GAAP to determine the fair value of the security. If determined adequate, we use the quote obtained.



Securities that are illiquid or for which the
pricing source does not provide a valuation or methodology or provides a valuation or methodology that, in the judgment of our Board
of Directors, does not represent fair value, are each valued as of the measurement date using all techniques appropriate under the circumstances
and for which sufficient data are available. These valuation techniques vary by investment but include comparable public market valuations,
comparable precedent transaction valuations and discounted cash flow analyses. Inputs for these valuation techniques include relative
credit information, observed market movement, industry sector information, and other market data, which may include benchmarking of comparable
securities, issuer spreads, reported trades, and reference data, such as market research publications, when available. The process used
to determine the applicable value is as follows:



(i) Each portfolio company or investment
is initially valued by the investment professionals of the Adviser responsible for the portfolio investment using a standardized template
designed to approximate fair market value based on observable market inputs and updated credit statistics and unobservable inputs. Additionally,
as a part of our valuation process, the Adviser may employ the services of one or more independent valuation firms engaged by us;



(ii) Preliminary valuation conclusions are
documented and discussed with our senior management and members of the Adviser’s valuation team;



(iii) Our Audit Committee reviews the assessments
of the Adviser or independent valuation firm (to the extent applicable) and provides our Board of Directors with recommendations with
respect to the fair value of the investments in our portfolio; and



(iv) Our Board of Directors discusses the
valuation recommendations of our Audit Committee and determines the fair value of the investments in our portfolio in good faith based
on the input of the Adviser, the independent valuation firm (to the extent applicable) and in accordance with our valuation policy.





16







Our Audit Committee’s recommendation of
fair value is generally based on its assessment of the following factors, as relevant:



| | · | the
                                            nature and realizable value of any collateral;
| | - | ----------------------------------------------------------------------------------------------



| | · | call
                                            features, put features and other relevant terms of debt;
| | - | ---------------------------------------------------------------------------------------------------------



| | · | the
                                            portfolio company’s ability to make payments;
| | - | ---------------------------------------------------------------------------------------------



| | · | the
                                            portfolio company’s actual and expected earnings and discounted cash flow;
| | - | --------------------------------------------------------------------------------------------------------------------------



| | · | prevailing
                                            interest rates for like securities and expected volatility in future interest rates;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------



| | · | the
                                            markets in which the portfolio company does business and recent economic and/or market events;
                                            and
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | comparisons
                                            to publicly traded securities.
| | - | --------------------------------------------------------------------------------------



Investment performance data utilized are the most
recently available as of the measurement date, which in many cases may reflect up to a one quarter lag in information.



Securities for which market quotations are not
readily available or for which a pricing source is not sufficient may include the following:



| | · | private
                                            placements and restricted securities that do not have an active trading market;
| | - | -----------------------------------------------------------------------------------------------------------------------------------



| | · | securities
                                            whose trading has been suspended or for which market quotes are no longer available;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------



| | · | debt
                                            securities that have recently gone into default and for which there is no current market;
| | - | ------------------------------------------------------------------------------------------------------------------------------------------



| | · | securities
                                            whose prices are stale; and
| | - | ----------------------------------------------------------------------------------



| | · | securities
                                            affected by significant events.
| | - | --------------------------------------------------------------------------------------



Our Board of Directors is responsible for the
determination, in good faith, of the fair value of our portfolio investments.



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



Security transactions are recorded on the trade
date (the date the order to buy or sell is executed or, in the case of privately issued securities, the closing date, which is when all
terms of the transactions have been defined). Realized gains and losses on investments are determined based on the identified cost method.



In addition, on December 3, 2020, the SEC
announced that it adopted Rule 2a-5 under the 1940 Act, which establishes an updated regulatory framework for determining fair value
in good faith for purposes of the 1940 Act. The adopted rule clarifies how fund boards can satisfy their valuation obligations in
light of recent market developments. The rule permits boards, subject to board oversight and certain other conditions, to designate
certain parties to perform the fair value determinations.



Refer to Note 3 — Investmentsin
the notes to our accompanying financial statements included elsewhere in this annual report for additional information regarding fair
value measurements and our application of ASC 820.





17







Advisory and Administrative Services



We do not currently have any employees. Our day-to-day
investment operations are managed by our Adviser, and our Administrator provides services necessary to conduct our business. No compensation
is paid directly by us to any interested director or executive officer of the Company. We pay our Adviser our allocable portion of overhead
and other expenses incurred by our Administrator in performing its obligations 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. Messrs. Magid
and McGonigle, as Managing Directors, have general oversight responsibility for Audax Senior Debt. Mr. McGonigle joined Audax Group
in 2007 and manages the activities of Audax Senior Debt. He has over 30 years of experience in sourcing, underwriting, and managing the
type of loans and other securities purchased by Audax Senior Debt. Mr. McGonigle leads a team of 10 seasoned debt investment professionals.
In addition, the Audax Senior Debt team is supported by experienced finance, accounting, legal, operations and investor relations professionals
as a part of the Audax Group platform and the Administrator’s proposed services to the Company. Our Adviser may hire additional
investment professionals in the future.



Material U.S. Federal Income Tax Considerations



The following discussion is a general summary
of the material U.S. federal income tax considerations applicable to us and to an investment in our Shares. This summary does not
purport to be a complete description of the income tax considerations applicable to such an investment. For example, we have not
described tax consequences that may be relevant to certain types of holders subject to special treatment under U.S. federal income
tax laws, including stockholders subject to the alternative minimum tax, or AMT, tax-exempt organizations, insurance companies,
dealers in securities, a trader in securities that elects to use a mark-to-market method of accounting for its securities holdings,
pension plans and trusts, financial institutions, U.S. expatriates, U.S. persons with a functional currency other than the U.S.
dollar, “controlled foreign corporations,” “passive foreign investment companies,” or corporations that
accumulate earnings to avoid U.S. federal income tax. This summary assumes that investors hold our Common Stock as capital assets
(within the meaning of the Code). The discussion is based upon the Code, U.S. Department of the Treasury, or Treasury, regulations,
and administrative and judicial interpretations, each as of the date of this annual report and all of which are subject to change,
possibly retroactively, which could affect the continuing validity of this discussion. This summary does not discuss any aspects of
U.S. estate or gift tax or foreign, state or local tax. It does not discuss the special treatment under U.S. federal income tax laws
that could result if we invested in tax-exempt securities or certain other investment assets.



For purposes of this discussion, a “U.S.
stockholder” generally is a beneficial owner of Shares who is for U.S. federal income tax purposes:



| | · | an
                                            individual who is a citizen or resident of the United States;
| | - | ------------------------------------------------------------------------------------------------------------



| | · | a corporation
                                            or other entity treated as a corporation, for U.S. federal income tax purposes, created or
                                            organized in or under the laws of the United States, any state thereof, or the District of
                                            Columbia;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | a trust
                                            if a court within the United States can exercise primary supervision over its administration
                                            and one or more U.S. persons have the authority to control all of its substantial decisions
                                            (or a trust that has made a valid election to be treated as a U.S. person); or
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | an
                                            estate, the income of which is subject to U.S. federal income taxation regardless of its
                                            source.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



For purposes of this discussion, a “Non-U.S.
stockholder” generally is a beneficial owner of the Shares who is not a U.S. stockholder.



If a partnership (including an entity treated
as a partnership for U.S. federal income tax purposes) holds the Shares, the tax treatment of a partner in the partnership will generally
depend upon the status of the partner and the activities of the partnership. A prospective stockholder that is a partner of a partnership
holding the Shares should consult its tax advisers with respect to the partnership’s purchase, ownership and disposition of the
Shares.





18







Tax matters are complicated and the tax consequences
to an investor of an investment in the Shares will depend on the facts of its particular situation. Moreover, prospective investors should
recognize that the present U.S. federal tax treatment of an investment in the Shares may be modified by legislative, judicial or administrative
action at any time, and that any such action may have retroactive effect, and such modifications could adversely affect the tax consequences
of investing in our Common Stock. We encourage investors to consult their tax advisers regarding the specific consequences of such an
investment, including tax reporting requirements, the applicability of U.S. federal, state, local and foreign tax laws, eligibility for
the benefits of any applicable tax treaty and the effect of any possible changes in the tax laws.



Election to be Taxed as a RIC



We have elected to be treated as a RIC under Subchapter
M of the Code. As a RIC, we generally will not be subject to corporate-level U.S. federal income taxes on any ordinary income or capital
gains that we distribute as dividends to our stockholders. To qualify and maintain our qualification as a RIC, we must, among other things,
meet certain source-of-income and asset diversification requirements (as described below). In addition, in order to obtain RIC tax treatment,
we must distribute dividends to our stockholders, in respect of each taxable year, generally of an amount at least equal to 90% of our
 “investment company taxable income,” which is generally defined as the sum of our net ordinary taxable income plus the excess
of realized net short-term capital gains over realized net long-term capital losses, determined without regard to any deduction for dividends
paid, or the Annual Distribution Requirement.



Taxation as a Regulated Investment Company



If we:



| | · | qualify
                                            as a RIC; and
| | - | -----------------------------------------------------------------



| | · | satisfy
                                            the Annual Distribution Requirement,
| | - | ----------------------------------------------------------------------------------------



then we will not be subject to U.S. federal income tax on the portion
of our taxable income (including capital gains) we distribute (or are deemed to distribute) as dividends to stockholders. We are subject
to U.S. federal income tax at regular corporate rates on any income or capital gains not distributed (or deemed distributed) to our stockholders.



As a RIC, we are subject to a 4% nondeductible
U.S. federal excise tax on certain undistributed income and gains if we fail to distribute dividends in a timely manner to stockholders
in respect of each calendar year of an amount at least equal to the sum of (1) 98% of our net ordinary income (taking into account
certain deferrals and elections) for the calendar year, (2) 98.2% of the excess of our capital gains over capital losses, or capital
gain net income (adjusted for certain net ordinary losses), for the one-year period ending October 31 of that calendar year and
(3) any net ordinary income or capital gain net income recognized, but not distributed, in preceding years, or the Excise Tax Avoidance
Requirement. For this purpose, however, any net ordinary income or capital gain net income retained by us and on which we incurred corporate
income tax for the taxable year ending in that calendar year will be considered to have been distributed by calendar year end (or earlier
if estimated taxes are paid). We intend to make sufficient distributions each year to satisfy the Excise Tax Avoidance Requirement.



We may incur in the future such excise tax on
all or a portion of our income and capital gains. While we intend to distribute income and capital gains to minimize exposure to the
4% excise tax, we may not be able to, or may choose not to, distribute amounts sufficient to avoid the imposition of the tax entirely.
In that event, we generally will be liable for the excise tax only on the amount by which we do not meet the Excise Tax Avoidance Requirement.



In order to qualify as a RIC for U.S. federal income tax purposes,
we must:



| | · | continue
                                            to qualify as a BDC under the 1940 Act at all times during each taxable year;
| | - | ----------------------------------------------------------------------------------------------------------------------------------





19







| | · | derive
                                            in each taxable year at least 90% of our gross income from dividends, interest, payments
                                            with respect to loans of certain securities, gains from the sale of stock or other securities
                                            or foreign currencies, net income from certain “qualified publicly traded partnerships,”
                                            or other income derived with respect to our business of investing in such stock or other
                                            securities, or foreign currencies, or the 90% Income Test; and
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | diversify
                                            our holdings so that at the end of each quarter of the taxable year:
| | - | --------------------------------------------------------------------------------------------------------------------------



| | o | at
                                            least 50% of the value of our assets consists of cash, cash equivalents, U.S. government
                                            securities, securities of other RICs, and other securities if such other securities of any
                                            one issuer do not represent more than 5% of the value of our assets or more than 10% of the
                                            outstanding voting securities of the issuer; and
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | o | no
                                            more than 25% of the value of our assets is invested in the securities, other than U.S. government
                                            securities or securities of other RICs, of one issuer, of two or more issuers that are controlled,
                                            as determined under applicable Code rules, by us and that are engaged in the same or similar
                                            or related trades or businesses, or of certain “qualified publicly traded partnerships,”
                                            or the Diversification Tests.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Some of the income that we might otherwise earn,
such as certain fees earned with respect to our investments, income recognized in a work-out or restructuring of a portfolio investment,
or income recognized from an equity investment in an operating partnership, may not be qualifying income under the 90% Income Test. To
manage the risk that such income might disqualify us as a RIC for failure to satisfy the 90% Income Test, one or more subsidiary entities
treated as U.S. corporations for U.S. federal income tax purposes may be employed to earn such income and (if applicable) hold the related
asset. Such subsidiary entities generally will be required to incur U.S. federal income tax as well as may be required to pay state or
local tax on their earnings, which ultimately will reduce the yield to our stockholders on such fees and income.



We may in the future decide to pay a portion of
our dividends in our stock. A distribution payable in stock or cash at the election of shareholders is treated as a dividend so long
as certain requirements are satisfied. If the total distribution to shareholders electing to receive cash would exceed the total amount
of cash to be distributed, each shareholder electing to receive the distribution in cash will be considered to have received a proportionate
share of the cash to be distributed. Taxable stockholders receiving such distributions are required to include the full amount of the
distribution (including the portion payable in stock) as ordinary income (or as long-term capital gain to the extent such distribution
is properly reported as a capital gain dividend) to the extent of our current and accumulated earnings and profits for U.S. federal income
tax purposes. As a result, a U.S. stockholder may be required to incur tax with respect to such distributions in excess of any cash received.
If a U.S. stockholder sells the stock it receives as a distribution in order to pay this tax, the sales proceeds may be less than the
amount included in income with respect to the distribution.



For U.S. federal income tax purposes, we may be
required to recognize taxable income in circumstances in which we do not currently receive cash in respect of such income. For example,
if we hold debt instruments that are treated under applicable tax rules as having OID (which may arise if we receive warrants in
connection with the origination of a loan or possibly in other circumstances), we must include in income each taxable year a portion
of the OID that accrues over the life of the instrument, regardless of whether cash in respect of such income is received by us in the
same taxable year. We may also have to include in income other amounts that we have not yet received in cash, such as contractual PIK
interest (which represents contractual interest added to the loan balance and due at the end of the loan term) and deferred loan origination
fees that are paid after origination of the loan or are paid in non-cash compensation such as warrants or stock. Because any OID or other
amounts accrued is included in our investment company taxable income for the taxable year of accrual, we may be required to make a distribution
to our stockholders in order to satisfy the Annual Distribution Requirement, even though we will not have received any corresponding
cash amount. Further, we may elect to amortize market discount and include such amounts in our taxable income in the current taxable
year, instead of upon disposition, as an election not to do so could limit our ability to deduct interest expense for tax purposes.





20







We are authorized to borrow funds and to sell
assets in order to satisfy distribution requirements. However, under the 1940 Act (and possibly certain debt covenants), we are not permitted
to make distributions to our stockholders while our debt obligations and other senior securities are outstanding unless certain “asset
coverage” tests are met. See “Item 1. Business — Regulation as a Business Development Company — Senior Securities.”
Moreover, our ability to dispose of assets to meet our distribution requirements may be limited by (1) the illiquid nature of our
portfolio and/or (2) other requirements relating to our qualification as a RIC, including the Diversification Tests. If we dispose
of assets in order to meet the Annual Distribution Requirement or the Excise Tax Avoidance Requirement, we may make such dispositions
at times that, from an investment standpoint, are not advantageous. If we are prohibited from making distributions or are unable to raise
additional debt or equity capital or sell assets to make distributions, we may not be able to make sufficient distributions to satisfy
the Annual Distribution Requirement, and therefore would not be able to maintain our ability to be subject to tax as a RIC.



A portfolio company in which we invest may face
financial difficulties that require us to work-out, modify or otherwise restructure our investment in the portfolio company. Any such
transaction could, depending upon the specific terms of the transaction, result in unusable capital losses and future non-cash income.
Any such transaction could also result in our receiving assets that give rise to non-qualifying income for purposes of the 90% Income
Test or otherwise would not count toward satisfying the Diversification Tests.



A RIC is limited in its ability to claim expenses
as deductions in excess of its investment company taxable income. If our expenses in a given taxable year exceed gross taxable income,
we would incur a net operating loss for that taxable year. However, a RIC is not permitted to carry forward net operating losses and
use such losses to offset investment company taxable income generated in subsequent taxable years. In addition, such expenses can be
used only to offset investment company taxable income, not net capital gain. Due to these limits on the deductibility of expenses, we
may for U.S. federal income tax purposes have aggregate taxable income for several taxable years that we distribute and that is taxable
to our stockholders even if such income is greater than the aggregate net income we actually earned during those taxable years. Such
distributions may be made from our cash assets or by premature sale, exchange, or other disposition of our investments, if necessary.
We may realize gains or losses from such sales, exchanges, or other disposition of our investments. In the event we realize net capital
gains (which are generally our realized net long-term capital gains in excess of realized net short-term capital losses) from such transactions,
you may receive a larger capital gain distribution than you would have received in the absence of such transactions.



Investment income received from sources within
foreign countries, or capital gains earned by investing in securities of foreign issuers, may be subject to foreign income taxes withheld
at the source. In this regard, withholding tax rates in countries with which the United States does not have a tax treaty are often as
high as 35% or more. The United States has entered into tax treaties with many foreign countries that may entitle us to a reduced rate
of tax or exemption from tax on this related income and gains. The effective rate of foreign tax cannot be determined at this time since
the amount of our assets to be invested within various countries is not now known. We do not anticipate being eligible for the special
election that allows a RIC to treat foreign income taxes paid by such RIC as paid by its stockholders.



If we acquire interests treated as equity securities
in certain foreign corporations for U.S. federal income tax purposes that earn at least 75% of their annual gross income from passive
sources (such as interest, dividends, rents, royalties or capital gain) or hold at least 50% of their total assets in investments producing
such passive income (“passive foreign investment companies” or “PFICs”), we could be subject to U.S. federal
income tax and additional interest charges on “excess distributions” received from such corporations or gain from the sale
of stock in such corporations, even if all income or gain actually earned by us is timely distributed to our stockholders. We would not
be able to pass through to our stockholders any credit or deduction for such a tax. Certain elections may, if available, ameliorate these
adverse tax consequences, but any such election may require us to recognize taxable income or gain without the concurrent receipt of
cash, and such income will nevertheless be subject to the Annual Distribution Requirement as well as will be taken into account for purposes
of determining whether we satisfy the Excise Tax Avoidance Requirement.



Our functional currency, for U.S. federal tax
purposes, is the U.S. dollar. Under Section 988 of the Code, gains and losses realized by us attributable to fluctuations in exchange
rates between the time we accrue income, expenses, or other liabilities denominated in a foreign currency and the time we actually collect
such income or pay such expenses or liabilities generally will be characterized as ordinary gains and losses. Similarly, gains and losses
realized by us upon the sale, exchange, or other disposition of debt instruments denominated in a foreign currency, foreign currency
forward contracts, and other financial transactions denominated in a foreign currency, to the extent attributable to fluctuations in
exchange rates between their acquisition and disposition dates, generally will be characterized as ordinary gains and losses. In each
case, such gains and losses may affect the amount, timing and character of distributions to our stockholders. Any such transactions that
are not directly related to our investment in securities (possibly including speculative currency positions or currency derivatives not
used for hedging purposes) could, under future Treasury regulations, produce income not among the types of “qualifying income”
for purposes of the 90% Income Test.





21







Certain of our investment practices may be subject
to special and complex U.S. federal income tax provisions that may, among other things: (i) disallow, suspend or otherwise limit
the allowance of certain losses or deductions; (ii) convert lower taxed long-term capital gain into higher taxed short-term capital
gain or ordinary income; (iii) convert an ordinary loss or a deduction into a capital loss (the deductibility of which is more limited);
(iv) cause us to recognize income or gain without a corresponding receipt of cash; (v) adversely affect the time as to when
a purchase or sale of securities is deemed to occur; (vi) adversely alter the characterization of certain complex financial transactions;
and (vii) produce income that will not be qualifying income for purposes of the 90% Income Test. We intend to monitor our transactions
and may make certain tax elections in order to mitigate the potential adverse effect of these provisions.



Gain or loss realized by us from the sale or exchange
of warrants acquired by us as well as any loss attributable to the lapse of such warrants generally will be treated as capital gain or
loss. The treatment of such gain or loss as long-term or short-term capital gain or loss will depend on how long we held a particular
warrant. Upon the exercise of a warrant acquired by us, our tax basis in the stock purchased under the warrant will equal the sum of
the amount paid for the warrant plus the strike price paid on the exercise of the warrant.



If we fail to satisfy the 90% Income Test or any
Diversification Tests in any taxable year, we may be eligible to avail ourselves of certain relief provisions under the Code if the failures
are due to reasonable cause and not willful neglect, and if a penalty tax is incurred with respect to each failure in satisfaction of
the applicable requirements. Additionally, relief is provided for certain de minimis failures of the Diversification Tests where we correct
a failure within a specified period. If the applicable relief provisions are not available or cannot be met, all of our income will be
subject to U.S. federal corporate-level income tax as described below. We cannot provide assurance that we would qualify for any such
relief should we fail either the 90% Income Test or any Diversification Test.



If we fail to satisfy the Annual Distribution
Requirement or otherwise fail to qualify as a RIC in any taxable year, and are not eligible for relief as described above, we will be
subject to tax in that taxable year on all of our taxable income, regardless of whether we make any distributions to our stockholders.
In that case, all of our taxable income will be subject to U.S. federal corporate-level income tax, reducing the amount available to
be distributed to our stockholders. In contrast, assuming we qualify as a RIC, our U.S. federal corporate-level income tax should be
substantially reduced or eliminated. To qualify again to be subject to tax as a RIC in a subsequent taxable year, we would be required
to distribute to our stockholders our accumulated earnings and profits attributable to our non-RIC taxable years. In addition, if we
failed to qualify as a RIC for a period of greater than two consecutive taxable years, then, in order to qualify as a RIC in a subsequent
taxable year, we would be required to either elect to recognize and incur tax on any net built-in gain (i.e., the excess of aggregate
gain, including items of income, over aggregate loss that would have been realized if we had been liquidated) in our assets held at the
end of the taxable year in which we choose to requalify as a RIC or, alternatively, be subject to taxation on such built-in gain recognized
for a period of five taxable years following the taxable year in which we choose to requalify as a RIC.



The remainder of this discussion assumes that
we qualify as a RIC and have satisfied the Annual Distribution Requirement.





22







Taxation of U.S. Stockholders



Distributions by us generally are taxable to U.S.
stockholders as ordinary income or capital gains. Distributions of our investment company taxable income are taxable as ordinary dividend
income to U.S. stockholders to the extent of our current or accumulated earnings and profits, whether paid in cash or reinvested in additional
Common Stock. To the extent such distributions paid by us to non-corporate stockholders (including individuals) are attributable to dividends
from U.S. corporations and certain qualified foreign corporations and if certain holding period and other requirements are met, such
distributions, or Qualifying Dividends, may be eligible for a maximum tax rate of either 15% or 20%, depending on whether the stockholder’s
income exceeds certain threshold amounts, and if other applicable requirements are met, such distributions generally will be eligible
for the corporate dividends received deduction to the extent such dividends have been consist of income from qualifying sources. In this
regard, it is anticipated that distributions paid by us will generally not be attributable to dividends and, therefore, generally will
not qualify for the maximum rate applicable to Qualifying Dividends or the dividends received deduction available to corporations under
the Code. Distributions of our net capital gains that are properly reported by us as “capital gain dividends” generally would
be characterized as long-term capital gains. Capital gain dividends are currently subject to a maximum U.S. federal income tax rate of
20%, in the case of individuals, trusts or estates, regardless of the U.S. stockholder’s holding period for his, her or its Common
Stock and regardless of whether paid in cash or reinvested in additional Common Stock. Distributions in excess of our earnings and profits
first will reduce a U.S. stockholder’s adjusted tax basis in such stockholder’s Common Stock and, after the adjusted basis
is reduced to zero, will constitute capital gains to such U.S. stockholder.



Under the dividend reinvestment plan, our stockholders
who have not “opted out” of our dividend reinvestment plan will have their cash distributions automatically reinvested in
additional Shares, rather than receiving the cash distributions. Any distributions reinvested under the plan will nevertheless remain
taxable to U.S. stockholders. A U.S. stockholder will have an adjusted basis in the additional Shares purchased through the plan equal
to the cash that would have been received if the stockholder had received the distribution in cash, unless we issue new Shares that are
trading at or above net asset value, in which case, the stockholder’s basis in the new Shares will generally be equal to their
fair market value. The additional Shares will have a new holding period commencing on the day following the day on which the Shares are
credited to the U.S. stockholder’s account.



Although we currently intend to distribute any
net capital gains at least annually, we may in the future decide to retain some or all of our net capital gains but report the retained
amount as a “deemed distribution.” In that case, among other consequences, we will pay tax on the retained amount, each U.S.
stockholder will be required to include such stockholder’s share of the deemed distribution in income as if it had been distributed
to the U.S. stockholder, and the U.S. stockholder will be entitled to claim a credit equal to such stockholder’s allocable share
of the tax paid on the deemed distribution by us. The amount of the deemed distribution net of such tax will be added to the U.S. stockholder’s
tax basis for its Shares. Since we expect to pay tax on any retained net capital gains at our regular corporate tax rate, and since that
rate is generally in excess of the maximum rate currently payable by individuals on long-term capital gains, the amount of tax that individual
stockholders will be treated as having paid and for which they will receive a credit will exceed the tax they owe on the retained net
capital gains. Such excess generally may be claimed as a credit against the U.S. stockholder’s other U.S. federal income tax obligations
or may be refunded to the extent it exceeds a stockholder’s liability for U.S. federal income tax. A stockholder that is not subject
to U.S. federal income tax or otherwise required to file a U.S. federal income tax return would be required to file a U.S. federal income
tax return on the appropriate form in order to claim a refund for the taxes we paid. In order to utilize the deemed distribution approach,
we must provide written notice to our stockholders prior to the expiration of 60 days after the close of the relevant taxable year. We
cannot treat any distributions derived from our investment company taxable income as a “deemed distribution.”



For purposes of determining (1) whether the
Annual Distribution Requirement is satisfied for any taxable year and (2) the amount of capital gain dividends paid for that taxable
year, we may, under certain circumstances, elect to treat a dividend that is paid during the following taxable year as if it had been
paid during the taxable year in question. If we make such an election, the U.S. stockholder will still be treated as receiving the dividend
in the taxable year in which the distribution is made. However, any dividend declared by us in October, November or December of
any calendar year, payable to stockholders of record on a specified date in such a month and actually paid during January of the
following calendar year, will be treated as if it had been received by our U.S. stockholders on December 31 of the calendar year
in which the dividend was declared.



If an investor purchases the Shares shortly before
the record date of a distribution, the price of the Shares will include the value of the distribution and the investor will be subject
to tax on the distribution even though economically it may represent a return of the investor’s investment.





23







A stockholder generally will recognize taxable
gain or loss if the stockholder sells or otherwise disposes of the stockholder’s Shares. The amount of gain or loss will be measured
by the difference between such stockholder’s adjusted tax basis in the Common Stock sold and the amount of the proceeds received
in exchange. Any gain arising from such sale or disposition generally will be treated as long-term capital gain or loss if the stockholder
has held the Shares for more than one year. Otherwise, it will be classified as short-term capital gain or loss. However, any capital
loss arising from the sale or disposition of the Shares held for six months or less will be treated as long-term capital loss to the
extent of the amount of capital gain dividends received or undistributed capital gain deemed received, with respect to such Shares. In
addition, all or a portion of any loss recognized upon a disposition of the Shares may be disallowed if other Shares are purchased (whether
through reinvestment of distributions or otherwise) within 30 days before or after the disposition. In such a case, the basis of the
Common Stock acquired will be increased to reflect the disallowed loss.



In general, individual and other non-corporate
U.S. stockholders currently are subject to a maximum federal income tax rate of either 15% or 20%, depending on whether the stockholder’s
income exceeds certain threshold amounts, on their net capital gain (i.e., the excess of realized net long-term capital gains over realized
net short-term capital losses), including any long-term capital gain derived from an investment in the Shares. Such rate is lower than
the maximum rate on ordinary income currently payable by individuals. An additional 3.8% Medicare tax is imposed on certain net investment
income (including ordinary dividends and capital gain distributions received from us and net gains from redemptions or other taxable
dispositions of our Common Stock) of U.S. individuals, estates and trusts to the extent that such person’s “modified adjusted
gross income” (in the case of an individual) or “adjusted gross income” (in the case of an estate or trust) exceeds
certain threshold amounts. Corporate U.S. stockholders currently are subject to U.S. federal income tax on net capital gain at the maximum
21% rate also applied to ordinary income. Non-corporate stockholders incurring net capital losses for a taxable year (i.e., capital losses
in excess of capital gains) generally may currently deduct up to $3,000 of such losses against their ordinary income each taxable year;
any net capital losses of a non-corporate stockholder in excess of $3,000 generally may be carried forward and used in subsequent taxable
years as provided in the Code. Corporate stockholders generally may not deduct any net capital losses for a taxable year, but may carry
back such losses for three taxable years or carry forward such losses for five taxable years.



For any period that we are not considered to be
a “publicly offered regulated investment company” within the meaning of Section 67 of the Code, a non-corporate stockholder’s
pro rata portion of our affected expenses, including our management fees, will be treated as an additional dividend to the stockholder
and will be deductible by such stockholder only to the extent permitted under the limitations described below. For non-corporate stockholders,
including individuals, trusts, and estates, significant limitations generally apply to the deductibility of certain expenses of a non-publicly
offered RIC, including advisory fees. In particular, these expenses, referred to as miscellaneous itemized deductions, will be deductible
only to individuals to the extent they exceed 2% of such a stockholder’s adjusted gross income after 2025 and will not be deductible
at all before then, are not deductible for AMT purposes and are subject to the overall limitation on itemized deductions under Section 68
of the Code. A publicly offered regulated investment company is a RIC whose shares are either (i) continuously offered pursuant
to a public offering within the meaning of Section 4 of the Securities Act of 1933, as amended, or the Securities Act, (ii) regularly
traded on an established securities market or (iii) held by at least 500 persons at all times during the taxable year. We anticipate
that we will not qualify as a publicly offered RIC for the foreseeable future.



We (or if a U.S. stockholder holds Shares through
an intermediary, such intermediary) will send to each of our U.S. stockholders, as promptly as possible after the end of each calendar
year, a notice detailing, on a per Share and per distribution basis, the amounts includible in such U.S. stockholder’s taxable
income for such year as ordinary income and as long-term capital gain. In addition, the U.S. federal tax status of each year’s
distributions generally will be reported to the IRS (including the amount of dividends, if any, eligible for the preferential maximum
rate). Dividends paid by us generally will not be eligible for the dividends-received deduction or the preferential tax rate applicable
to Qualifying Dividends because our income generally will not consist of dividends. Distributions may also be subject to additional state,
local and foreign taxes depending on a U.S. stockholder’s particular situation. In addition, the Code requires reporting of adjusted
cost basis information for covered securities, which generally include shares of a RIC acquired after January 1, 2012, to the IRS
and to taxpayers. Stockholders should contact their financial intermediaries with respect to reporting of cost basis and available elections
for their accounts.





24







Under applicable Treasury regulations, if a U.S.
stockholder recognizes a loss with respect to our Common Stock of $2 million or more for a non- corporate U.S. stockholder or $10 million
or more for a corporate U.S. stockholder in any single taxable year (or a greater loss over a combination of years), the U.S. stockholder
must file with the IRS a disclosure statement on Form 8886. Direct U.S. stockholders of portfolio securities are in many cases excepted
from this reporting requirement, but under current guidance, U.S. stockholders of a RIC are not excepted. Future guidance may extend
the current exception from this reporting requirement to U.S. stockholders of most or all RICs. The fact that a loss is reportable under
these regulations does not affect the legal determination of whether the taxpayer’s treatment of the loss is proper. Significant
monetary penalties apply to a failure to comply with this reporting requirement. States may also have a similar reporting requirement.
U.S. stockholders should consult their own tax advisers to determine the applicability of these Treasury regulations in light of their
individual circumstances.



We may be required to withhold federal income
tax, or backup withholding, currently at a rate of 24%, from all distributions to any U.S. stockholder (1) who fails to furnish
us with a correct taxpayer identification number or a certificate that such stockholder is exempt from backup withholding or (2) with
respect to whom the IRS notifies us that such stockholder has failed to properly report certain interest and dividend income to the IRS
and to respond to notices to that effect. An individual’s taxpayer identification number generally is his or her social security
number. Backup withholding is not an additional tax. Any amount withheld under backup withholding is allowed as a credit against the
U.S. stockholder’s federal income tax liability, so long as proper information is provided to the IRS.



Taxation of Tax-Exempt U.S. Stockholders



A U.S. stockholder that is a tax-exempt organization
for U.S. federal income tax purposes and therefore generally exempt from U.S. federal income taxation may nevertheless be subject to
taxation to the extent that it is considered to derive unrelated business taxable income, or UBTI. The direct conduct by a tax-exempt
U.S. stockholder of the activities that we have conducted and are eligible to conduct could give rise to UBTI. However, if a BDC is classified
as a corporation for U.S. federal income tax purposes, its business activities generally will not be attributed to its stockholders for
purposes of determining the treatment of any amounts earned from the BDC for U.S. federal income tax purposes. Therefore, a tax-exempt
U.S. stockholder should not be subject to U.S. taxation solely as a result of the holder’s ownership of the Shares and receipt
of dividends that we pay. Moreover, under current law, if we incur indebtedness, such indebtedness will not be attributed to portfolio
investors in our stock. Therefore, a tax-exempt U.S. stockholder should not be treated as earning income from “debt-financed property”
and dividends we pay should not be treated as “unrelated debt-financed income” solely as a result of indebtedness that we
incur. Proposals periodically are made to change the treatment of “blocker” investment vehicles interposed between tax-exempt
investors and non-qualifying investments. In the event that any such proposals were to be adopted and applied to BDCs, the treatment
of dividends payable to tax-exempt U.S. stockholders could be adversely affected.



Taxation of Non-U.S. Stockholders



Whether an investment in the Shares is appropriate
for a Non-U.S. stockholder will depend upon that person’s particular circumstances. Non-U.S. stockholders should consult their
tax advisers before investing in our Common Stock.



Distributions of our “investment company
taxable income” to Non-U.S. stockholders generally will be subject to withholding of U.S. federal tax at a 30% rate (or lower rate
provided by an applicable treaty) to the extent of our current and accumulated earnings and profits unless an applicable exception applies.
If the distributions are effectively connected with a U.S. trade or business of the Non-U.S. stockholder, we will not be required to
withhold U.S. federal tax if the Non-U.S. stockholder complies with applicable certification and disclosure requirements, although the
distributions will be subject to U.S. federal income tax at the rates applicable to U.S. persons. Special certification requirements
apply to a Non-U.S. stockholder that is a foreign partnership or a foreign trust, and such entities are urged to consult their tax advisers.





25







However, certain properly reported distributions
are generally exempt from withholding of U.S. federal income tax where they are paid in respect of our (i) “qualified net
interest income” (generally, our U.S.-source interest income, other than certain contingent interest and interest from obligations
of a corporation or partnership in which we or the Non-U.S. stockholder are at least a 10% shareholder, reduced by expenses that are
allocable to such income) or (ii) “qualified short-term capital gains” (generally, the excess of our net short-term
capital gain, other than short-term capital gains recognized on the disposition of U.S. real property interests, over our long-term capital
loss for such taxable year), and certain other requirements were satisfied. No assurance can be given as to whether any of our distributions
will be eligible for this exemption from withholding of U.S. federal income tax or, if eligible, will be reported as such by us. In the
case of Shares held through an intermediary, the intermediary may withhold U.S. federal income tax even if we report the payment as a
distribution derived from qualified net interest income or qualified short-term capital gain. Moreover, depending on the circumstances,
we may report all, some or none of our potentially eligible distributions as derived from such qualified net interest income or as qualified
short-term capital gains, or treat such distributions, in whole or in part, as ineligible for this exemption from withholding.



Actual or deemed distributions of our net capital
gains to a stockholder that is a Non-U.S. stockholder, and gains realized by a Non-U.S. stockholder upon the sale or redemption of our
Common Stock, will not be subject to U.S. federal income tax unless the distributions or gains, as the case may be, are effectively connected
with a U.S. trade or business of the Non-U.S. stockholder (and, if an income tax treaty applies, are attributable to a permanent establishment
maintained by the Non-U.S. stockholder in the United States) or, in the case of an individual, the Non-U.S. stockholder was present in
the United States for 183 days or more during the taxable year and certain other conditions are met.



If we distribute our net capital gains in the
form of deemed rather than actual distributions, a stockholder that is a Non-U.S. stockholder will be entitled to a U.S. federal income
tax credit or tax refund equal to the stockholder’s allocable share of the corporate-level tax we pay on the capital gains deemed
to have been distributed; however, in order to obtain the refund, the Non-U.S. stockholder must obtain a U.S. taxpayer identification
number and file a U.S. federal income tax return even if the Non-U.S. stockholder would not otherwise be required to obtain a U.S. taxpayer
identification number or file a U.S. federal income tax return.



For a corporate Non-U.S. stockholder, distributions
(both actual and deemed), and gains realized upon the sale or redemption of our Common Stock that are effectively connected to a U.S.
trade or business may, under certain circumstances, be subject to an additional “branch profits tax” at a 30% rate (or at
a lower rate if provided for by an applicable treaty).



Under the dividend reinvestment plan, our stockholders
who have not “opted out” of our dividend reinvestment plan will have their cash distributions automatically reinvested in
additional Shares, rather than receiving the cash distributions. If the distribution is a distribution of our investment company taxable
income, is not properly reported by us as derived from qualified short-term capital gains or qualified net interest income (as discussed
above), and it is not effectively connected with a U.S. trade or business of a Non-U.S. stockholder (or, if a treaty applies, is not
attributable to a permanent establishment), the amount distributed (to the extent of our current and accumulated earnings and profits)
will be subject to U.S. federal withholding tax at a 30% rate (or lower rate provided by an applicable treaty) and only the net after-tax
amount will be reinvested in the Shares. If the distribution is effectively connected with a U.S. trade or business of a Non-U.S. stockholder,
generally the full amount of the distribution will be reinvested in the plan and will nevertheless be subject to U.S. federal income
tax at the ordinary income rates applicable to U.S. persons. A Non-U.S. stockholder will have an adjusted basis in the additional Shares
purchased through the plan equal to the cash that would have been received if the stockholder had received the distribution in cash,
unless we issue new Shares that are trading at or above net asset value, in which case, the stockholder’s basis in the new Shares
will generally be equal to their fair market value. The additional Shares will have a new holding period commencing on the day following
the day on which the Shares are credited to the Non-U.S. stockholder’s account.



A Non-U.S. stockholder who is a non-resident alien
individual, and who is otherwise subject to withholding of U.S. federal tax, may be subject to information reporting and backup withholding
of U.S. federal income tax on dividends unless the Non-U.S. stockholder provides us or the dividend paying agent with a U.S. nonresident
withholding tax certificate (e.g. an IRS Form W-8BEN, IRS Form W-8BEN-E or an acceptable substitute form) or an acceptable
substitute form.





26







We are required to withhold U.S. tax (at a 30%
rate) on payments of taxable dividends to certain non-U.S. entities that fail to comply (or be deemed compliant) with extensive new reporting
and withholding requirements designed to inform the Treasury of U.S.-owned foreign investment accounts. Stockholders may be requested
to provide additional information to us to enable us to determine whether withholding is required.



An investment in the Shares by a non-U.S. person
may also be subject to U.S. federal estate tax. Non-U.S. persons should consult their own tax advisers with respect to the U.S. federal
income tax and withholding tax, and state, local and foreign tax consequences of an investment in the Shares.



Change in Taxable Year



For the period from inception through July 7,
2015, we were subject to tax as a corporation. Based upon our election to be subject to tax as a RIC as of our initial RIC taxable year
ended December 31, 2015, as well as our intended maintenance of such election in future taxable years, no provision for U.S. federal,
state and local taxes was accrued and included in the accompanying statement of operations for our fiscal periods ended December 31,
2022, 2021, and 2020.



Regulation as a Business Development Company



General



A BDC is a specialized investment vehicle that
elects to be regulated under the 1940 Act as an investment company, but is generally subject to less onerous requirements than other
registered investment companies under a regime designed to encourage lending to U.S.-based small and mid-sized businesses. Unlike many
similar types of investment vehicles that are restricted to being private entities, the stock of a BDC is permitted to trade in the public
equity markets (although there are no current plans to list the Shares to allow for such trading). BDCs are also eligible to elect to
be treated as a RIC under Subchapter M of the Code. A RIC typically does not incur significant entity-level income taxes, because it
is generally entitled to deduct distributions made to its stockholders.



Advantages of a BDC Compared to Other Institutional Investment
Vehicles



The advantages of the BDC structure derive from two characteristics:



First, a BDC is permitted to become a publicly
traded company. This can provide a BDC with access to an additional source of capital and offers investors the potential to monetize
their investment through the sale of shares in an active public stock market. Most BDCs trade on either the New York Stock Exchange or
the Nasdaq Stock Market. We do not currently intend to list the shares on any securities exchange, and we do not expect a public market
to develop for them in the foreseeable future.



In contrast, many investment vehicles utilized
by institutional investors are required to be “private” vehicles. Investors in such vehicles can transfer their interests
only under strict rules designed to ensure that “private” status is maintained. This may have the effect of limiting
the liquidity of those interests and result in a discount when they trade in the secondary market. Typically, these investment vehicles
are designed for a medium-term (ten year) life, and the timing of return of capital from these vehicles typically depends upon the investment
activity of the vehicle.



On the other hand, for a BDC, once a public market
develops and lock-ups pursuant to any subscription agreements in respect of the shares expire, an investor is free to sell shares and
control the timing of any capital return. The timing and pricing of any initial public offering of our Common Stock, or an IPO, and subsequent
trading price of the Shares will depend on market conditions and our Adviser’s investment performance. Prior to an IPO, the Shares
will be subject to certain transfer restrictions. Following an IPO, investors may be restricted from selling or disposing of their Shares
by applicable securities laws, contractually by a lock-up agreement with the underwriters of the IPO and contractually through restrictions
contained in the subscription agreement in respect of the Shares. We note, however, that shares of our Common Stock are not currently
traded on a national securities exchange, and we do not currently intend to target a quotation or listing of our Common Stock on a national
securities exchange to allow for such trading.





27







Second, as a BDC, we have elected to be treated
as a RIC under the Code. A RIC typically does not incur significant entity-level income taxes, because it is entitled to deduct distributions
made to its stockholders treated as dividends for U.S. federal income tax purposes in computing its income subject to entity-level taxation.
As a result, a BDC that has elected to be a RIC does not incur any U.S. federal income tax so long as the BDC continuously maintains
its registration in accordance with the 1940 Act, at least 90% of the BDC’s gross income each taxable year consists of certain
types of qualifying investment income, the BDC satisfies certain asset composition requirements at the close of each quarter of its taxable
year, and if the BDC distributes all of its taxable income (including net realized capital gains, if any) to its stockholders on a current
basis. The rules applicable to our qualification as a RIC for tax purposes are complex and involve significant practical and technical
issues. If we fail to qualify as a RIC for U.S. federal income tax purposes or are unable to maintain our qualification for any reason,
then we would become subject to regular corporate income tax, which would have a material adverse effect on the amount of after-tax income
available for distribution to our stockholders. See “Item 1. Business — Material U.S. Federal Income Tax Considerations.”



Distributions by a BDC generally are treated as
dividends for U.S. tax purposes, and generally are subject to U.S. income or withholding tax unless the stockholder receiving the dividend
qualifies for an exemption from U.S. tax, or the distribution is subject to one of the special look-through rules. Distributions paid
out of U.S. derived interest income or short-term capital gains may qualify for an exemption from U.S. withholding tax. Distributions
paid out of net capital gains can qualify for a reduced rate of taxation in the hands of an individual U.S. stockholder and an exemption
from U.S. tax in the hands of a non-U.S. stockholder. Additionally, certain U.S. resident persons eligible to claim exemptions from U.S.
federal income tax provided by the Code (such as certain U.S. qualified plans and charitable organizations) that own shares in a BDC
generally are not required to take account of indebtedness incurred at the level of the BDC in determining whether dividends received
from a BDC constitute “unrelated debt-financed income.” Finally, a non-U.S. investor in a BDC generally does not need to
take account of activities conducted by the BDC in determining whether such non-U.S. investor is engaged in the conduct of a business
in the United States. See “Item 1. Business — Material U.S. Federal Income Tax Considerations.”



The 1940 Act contains prohibitions and restrictions
relating to transactions between BDCs and their affiliates (including any investment advisers or investment sub-advisers), principal
underwriters and affiliates of those affiliates or underwriters and requires that a majority of the directors of a BDC be persons other
than “interested persons,” as that term is defined in the 1940 Act. In addition, the 1940 Act provides that a BDC may not
change the nature of its business so as to cease to be, or to withdraw its election as, a BDC unless approved by a majority of its outstanding
voting securities as defined by the 1940 Act.



Qualifying Assets



Under the 1940 Act, a BDC may not acquire any
asset other than assets of the type listed in Section 55(a) of the 1940 Act, which are referred to as qualifying assets, unless,
at the time the acquisition is made, qualifying assets represent at least 70% of the BDC’s total assets. The principal categories
of qualifying assets relevant to our proposed business are the following:



| | (1) | Securities purchased in transactions not involving any public offering
                                            from the issuer of such securities, which issuer (subject to certain limited exceptions)
                                            is an eligible portfolio company, or from any person who is, or has been during the preceding
                                            13 months, an affiliated person of an eligible portfolio company, or from any other person,
                                            subject to such rules as may be prescribed by the SEC. An eligible portfolio company
                                            is defined in the 1940 Act as any issuer which:
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (a) | is organized under the laws of, and has its principal place of business
                                            in, the United States;
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------



| | (b) | is not an investment company (other than a small business investment
                                            company wholly owned by the BDC) or a company that would be an investment company but for
                                            certain exclusions under the 1940 Act; and
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





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(c)            satisfies
either of the following:



| | (i) | does not have any class of securities listed on a national securities
                                            exchange or has any class of securities listed on a national securities exchange subject
                                            to a $250 million market capitalization maximum; or
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (ii) | is controlled by a BDC or a group of companies including a BDC,
                                            the BDC actually exercises a controlling influence over the management or policies of the
                                            eligible portfolio company, and, as a result, the BDC has an affiliated person who is a director
                                            of the eligible portfolio company.
| | ---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



(2)   Securities
of any eligible portfolio company which we control.



| | (3) | Securities purchased in a private transaction from a U.S. issuer
                                            that is not an investment company or from an affiliated person of the issuer, or in transactions
                                            incident thereto, if the issuer is in bankruptcy and subject to reorganization or if the
                                            issuer, immediately prior to the purchase of its securities, was unable to meet its obligations
                                            as they came due without material assistance other than conventional lending or financing
                                            arrangements.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (4) | Securities of an eligible portfolio company purchased from any person
                                            in a private transaction if there is no ready market for such securities and we already own
                                            60% of the outstanding equity of the eligible portfolio company.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (5) | Securities received in exchange for or distributed on or with respect
                                            to securities described in (1) through (4) above, or pursuant to the exercise of
                                            warrants or rights relating to such securities.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (6) | Cash, cash equivalents, U.S. government securities or high-quality
                                            debt securities maturing in one year or less from the time of investment.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Managerial Assistance to Portfolio Companies



In addition, a BDC must have been organized and
have its principal place of business in the United States and must be operated for the purpose of making investments in the types of
securities described in (1), (2) or (3) above. However, in order to count portfolio securities as qualifying assets for the
purpose of the 70% test, the BDC must either control the issuer of the securities or must offer to make available to the issuer of the
securities significant managerial assistance. However, when a BDC purchases securities in conjunction with one or more other persons
acting together, one of the other persons in the group may make available such managerial assistance. Making available managerial assistance
means, among other things, any arrangement whereby the BDC, through its directors, officers or employees, offers to provide, and, if
accepted, does so provide, significant guidance and counsel concerning the management, operations or business objectives and policies
of a portfolio company.



Temporary Investments



Pending investment in other types of “qualifying
assets,” as described above, our investments may consist of cash, cash equivalents, U.S. government securities or high-quality
debt securities maturing in one year or less from the time of investment, which we refer to, collectively, as temporary investments,
so that 70% of our assets are qualifying assets.



Senior Securities



While there is no present intention to do so,
we are permitted, under specified conditions, to issue multiple classes of indebtedness and one class of stock senior to the Shares if
our asset coverage complies with the requirements of the 1940 Act. Under the 1940 Act, and absent specific authorization by our Board
of Directors or stockholders, a BDC generally is required to maintain asset coverage of 200% for senior securities representing indebtedness
(such as borrowings from banks or other financial institutions) or stock (such as preferred stock). The Small Business Credit Availability
Act, or the SBCAA, provides that a BDC’s required asset coverage under the 1940 Act may be reduced from 200% to 150%. This reduction
in asset coverage would permit a BDC to double the amount of leverage it may utilize, subject to certain approval, timing and reporting
requirements, including either stockholder approval or approval of a majority of the directors who are not “interested persons”
(as defined in the 1940 Act) of the BDC and who have no financial interest in the arrangement. As defined in the 1940 Act, asset coverage
of 150% means that for every $100 of net assets a BDC holds, it may raise up to $200 from borrowing and issuing senior securities. In
addition, while any senior securities remain outstanding, we must make provisions to prohibit any distribution to our stockholders or
the repurchase of such securities or shares unless we meet the applicable asset coverage ratios at the time of the distribution or repurchase.
We may also borrow amounts up to 5% of the value of our total assets for temporary or emergency purposes without regard to asset coverage.
Regulations governing our operations as a BDC will affect our ability to raise, and the method of raising, additional capital, which
may expose us to risks.





29







Code of Ethics



We and our Adviser have adopted a joint code of
ethics pursuant to Rule 17j-1 under the 1940 Act that establishes procedures for personal investments and restricts certain personal
securities transactions. Personnel subject to the joint code may invest in securities for their personal investment accounts, including
securities that may be purchased or held by us, so long as such investments are made in accordance with the code’s requirements.



Proxy Voting Policies and Procedures



We have delegated our proxy voting responsibility
to our Adviser. A summary of the proxy voting policies and procedures of our Adviser, or the Proxy Voting Policies and Procedures, are
set forth below. These policies and procedures will be reviewed periodically by our Adviser and, subsequent to our election to be regulated
as a BDC, our non-interested directors, and, accordingly, are subject to change. For purposes of these Proxy Voting Policies and Procedures
described below, “we” “our” and “us” refers to our Adviser.



An investment adviser registered under the Investment
Advisers Act of 1940, as amended, or the Advisers Act, has a fiduciary duty to act solely in the best interests of its clients. As part
of this duty, we recognize that we must vote client securities in a timely manner free of conflicts of interest and in the best interests
of our clients.



These policies and procedures for voting proxies
for our investment advisory clients are intended to comply with Section 206 of, and Rule 206(4)-6 under, the Advisers Act.



We vote proxies relating to our portfolio securities
in what we believe to be the best interest of our clients’ stockholders by seeking to maximize the economic value of each such
client’s holdings. In doing so, we take into account the relevant client’s investment horizon, the contractual obligations
under the applicable advisory agreements or comparable documents, and all other relevant facts and circumstances at the time of the vote.
It is our general policy to vote or give consent on all matters presented to security holders in any vote; provided, however, that we
reserve the right to abstain on any particular vote or otherwise withhold our vote or consent on any matter if, in the judgment of our
general counsel or our relevant investment professional, the costs associated with such vote outweigh the benefits to the relevant clients
or if the circumstances make such an abstention or withholding otherwise advisable and in the best interests of the relevant clients.



Our proxy voting decisions are made by the senior
officers who are responsible for monitoring each of our clients’ investments. To ensure that our vote is not the product of a conflict
of interest, we require that: (1) anyone involved in the decision making process disclose to our chief compliance officer any potential
conflict that he or she is aware of and any contact that he or she has had with any interested party regarding a proxy vote; and (2) employees
involved in the decision making process or vote administration are prohibited from revealing how we voted on a proposal in order to reduce
any attempted influence from interested parties.



You may obtain information about how we voted
proxies by making a written request for proxy voting information to: Audax Management Company (NY), LLC, 101 Huntington Avenue, Boston,
MA 02199, Attention: General Counsel.





30







Privacy Principles



We are committed to maintaining the privacy of
our investors and to safeguarding their non-public personal information. The following information is provided to help you understand
what personal information we collect, how we protect that information and why, in certain cases, we may share information with select
other parties.



We do not disclose any non-public personal information
about our stockholders or a former stockholder to anyone, except as permitted by law or as is necessary in order to service stockholder
accounts (for example, to a transfer agent or third party administrator).



We restrict access to non-public personal information
about our stockholders to employees of our Adviser and its affiliates with a legitimate business need for the information. We maintain
physical, electronic and procedural safeguards designed to protect the non-public personal information of our stockholders.



Other



We are prohibited under the 1940 Act from knowingly
participating in certain transactions with our affiliates, including the Adviser, without the prior approval of our independent directors
and, in some cases, prior approval by the SEC.



On November 7, 2018, we and the Adviser and
other affiliates received exemptive relief from the SEC to permit greater flexibility to negotiate the terms of co-investments because
we believe that it will be advantageous for us to co-invest with accounts sponsored or managed by the Adviser and its affiliates where
such investment is consistent with our investment objectives, positions, policies, strategies and restrictions, as well as regulatory
requirements and other pertinent factors. We may also co-invest alongside other accounts sponsored or managed by our Adviser and its
affiliates as otherwise permissible under SEC staff guidance and interpretations, applicable regulations and the allocation policy of
the Adviser. We believe that co-investment by us and accounts sponsored or managed by the Adviser may afford us additional investment
opportunities.



Under the terms of our exemptive relief, a “required
majority” (as defined in Section 57(o) of the 1940 Act) of our independent directors is required to make certain conclusions
in connection with a co-investment transaction, including that (1) the terms of the proposed transaction are reasonable and fair
to us and our stockholders and do not involve overreaching of us or our stockholders on the part of any person concerned and (2) the
transaction is consistent with the interests of our stockholders and is consistent with our investment strategies and policies.



We are subject to periodic examination by the
SEC for compliance with the 1940 Act.



We are required to provide and maintain a bond
issued by a reputable fidelity insurance company to protect us against larceny and embezzlement. Furthermore, as a BDC, we are prohibited
from protecting any director or officer against any liability to us or our stockholders arising from willful misfeasance, bad faith,
gross negligence or reckless disregard of the duties involved in the conduct of such person’s office.



We and our Adviser are each required to adopt
and implement written policies and procedures reasonably designed to prevent violation of the federal securities laws, review these policies
and procedures annually for their adequacy and the effectiveness of their implementation, and designate a chief compliance officer to
be responsible for administering the policies and procedures.





31







Item 1A. Risk Factors



Investing in the Shares involves a number of significant risks.
In addition to the other information contained in this annual report, you should consider carefully the following information before
making an investment in the Shares. The risks below are not the only risks we face. Additional risks and uncertainties not presently
known to us or not presently deemed material by us could also impair our operations and performance. If any of the following events occur,
our business, financial condition and results of operations could be materially and adversely affected. In such case, the net asset value
of the Shares could decline, and you may lose all or part of your investment.



The following is a summary of the principal risk
factors associated with an investment in us. Further details regarding each risk included in the summary can be found further below.



| | · | Investing
                                            in the Shares involves a high degree of risk, and you could lose all or part of your investment.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Global
                                            markets could enter a period of severe disruption and instability due to catastrophic events,
                                            such as terrorist attacks, acts of war, natural disasters, and outbreaks of epidemic, pandemic
                                            or contagious diseases, which could impair our portfolio companies’ financial positions
                                            and operating results and affect the industries in which we invest and, in turn, harm our
                                            operating results
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | An
                                            investment strategy focused primarily on privately held companies presents certain challenges,
                                            including the lack of available information about these companies.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Our
                                            portfolio securities may be thinly traded and, as a result, the lack of liquidity in our
                                            investments may adversely affect our business.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | We
                                            may hold the debt securities of leveraged companies that may, due to the significant volatility
                                            of such companies, enter into bankruptcy proceedings.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | We
                                            are exposed to risks associated with changes in interest rates.
| | - | --------------------------------------------------------------------------------------------------------------



| | · | To
                                            the extent we make investments in restructurings and reorganizations they may be subject
                                            to greater regulatory and legal risks than other traditional investments in portfolio companies.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | There
                                            is no public market for the Shares, and we do not expect any market for the Shares to develop.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Our
                                            portfolio may be concentrated in a limited number of portfolio companies and industries,
                                            which will subject us to a risk of significant loss if any of these companies defaults on
                                            its obligations under any of its debt instruments or if there is a downturn in a particular
                                            industry.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Because
                                            our business model depends to a significant extent upon relationships with corporations,
                                            financial institutions and investment firms, the inability of our Adviser to maintain or
                                            develop these relationships, or the failure of these relationships to generate investment
                                            opportunities, could adversely affect our business.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | We
                                            may face increasing competition for investment opportunities, which could delay deployment
                                            of our capital, reduce returns and result in losses.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | A significant
                                            portion of our investment portfolio is recorded at fair value as determined in good faith
                                            by our Board of Directors and, as a result, there is uncertainty as to the value of our portfolio
                                            investments.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Our
                                            Adviser and its affiliates, including our officers and some of our directors, could face
                                            conflicts of interest caused by compensation arrangements with us, which could result in
                                            actions that are not in the best interests of our stockholders.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Our
                                            ability to achieve our investment objective depends on our Adviser’s ability to manage
                                            and support our investment process. If our Adviser were to lose its key professional(s),
                                            our ability to achieve our investment objective could be significantly harmed.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Regulations
                                            governing our operation as a BDC and a RIC may affect our ability to, and the way in which
                                            we, raise additional capital and reduce our operating flexibility.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Each
                                            of our Adviser and Administrator is able to resign upon 60 days’ notice, and we may
                                            not be able to find a suitable replacement within that time, resulting in a disruption in
                                            our operations that could adversely affect our financial condition, business and results
                                            of operations.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Global
                                            capital markets could enter a period of severe disruption and instability due to future recessions,
                                            political instability, geopolitical turmoil and foreign hostilities, disease pandemics and
                                            other serious health events. These market disruptions have historically had and could again
                                            have a materially adverse effect on debt and equity capital markets in the United States,
                                            which could have a materially adverse impact on our business and financial condition.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Political,
                                            social, and economic uncertainty, including uncertainty related to the COVID-19 Pandemic,
                                            creates and exacerbates risks.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Economic
                                            recessions or downturns could impair our portfolio companies and harm our operating results.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------





32







Risks Related to our Investments



Investing in the Shares involves a high degree of risk.



The investments we make in accordance with our
investment objective may involve a higher amount of volatility and risk of loss of principal than alternative investment options and,
therefore, an investment in the Shares may not be suitable for someone with lower risk tolerance.



Our investments in portfolio companies may be risky, and we
could lose all or part of our investment.



We invest primarily in senior secured debt instruments,
including “one-stop” or “unitranche” senior secured loans, of privately owned U.S. companies with approximately
$10 to $75 million of annual EBITDA, with a focus on transactions sourced through the network of our Adviser. We intend to invest at
least 80% of our net assets, plus the amount of any borrowings, in credit instruments.



When we invest in senior secured debt, we generally
take a security interest in the available assets of these portfolio companies, including equity interests in their subsidiaries. There
is a risk that the collateral securing our investments may decrease in value over time or lose its entire value, may be difficult to
sell in a timely manner, may be difficult to appraise and may fluctuate in value based upon the success of the business and market conditions,
including as a result of the inability of the portfolio company to raise additional capital. Also, in some circumstances, our security
interest could be subordinated to claims of other creditors. In addition, any deterioration in a portfolio company’s financial
condition and prospects, including any inability on its part to raise additional capital, may result in the deterioration in the value
of the related collateral. Consequently, the fact that debt is secured does not guarantee that we will receive principal and interest
payments according to the investment terms or at all, or that we will be able to collect on the investment should we be forced to enforce
our remedies.



We typically lend directly to borrowers, and structure
our investments to include fixed repayment schedules and extensive contractual rights and remedies. We do not expect to invest in structured
products and investments and intend to focus on cash-pay instruments that pay interest on a monthly or quarterly basis, typically with
maturities ranging from five to seven years. Such first lien senior secured loans typically do not include equity co-investments, warrants
or PIK payment terms. However, to the extent we invest in securities ranking more junior in a borrower’s capital structure, which
we do not expect to be a focus of our portfolio, such investments may include some or all of these attributes. Any equity co-investments,
warrants or PIK instruments we hold may involve certain risks that are not applicable to the types of securities in which we typically
invest. These risks include the possibility of being unsecured with respect to our claim on such investments if the portfolio company
were to go bankrupt or being paid less upon such bankruptcy than we otherwise would have had such investment been in the form of a senior
loan.



Most loans in which we invest are not rated by
any rating agency. If they were rated, they would be rated as below investment grade quality. Loans rated below investment grade quality,
which are often referred to as “junk” loans, are generally regarded as having predominantly speculative characteristics and
may carry a greater risk with respect to a borrower’s capacity to pay interest and repay principal. Therefore, our investments
may result in an above average amount of risk and volatility or loss of principal. To the extent we make investments with a deferred
interest feature such as market discount, debt instruments with PIK interest and OID securities, the higher interest rates on these investments
may reflect the payment deferral and an increased credit risk associated with such instruments.



We are a non-diversified investment company within the meaning
of the 1940 Act, and therefore we are not limited with respect to the proportion of our assets that may be invested in securities of
a single issuer.



We are classified as a non-diversified investment
company within the meaning of the 1940 Act, which means that we are not limited by the 1940 Act with respect to the proportion of our
assets that we may invest in securities of a single issuer. To the extent that we assume large positions in the securities of a small
number of issuers, our net asset value may fluctuate to a greater extent than that of a diversified investment company as a result of
changes in the financial condition or the market’s assessment of the issuer. We may also be more susceptible to any single economic
or regulatory occurrence than a diversified investment company. Beyond our asset diversification requirements as a RIC under the Code,
we do not have fixed guidelines for diversification, and our investments could be concentrated in relatively few portfolio companies.
Although we are classified as a non-diversified investment company within the meaning of the 1940 Act, we maintain the flexibility to
operate as a diversified investment company and have done so for an extended period of time. To the extent that we operate as a non-diversified
investment company in the future, we may be subject to greater risk.





33







We generally do not control the business operations of our portfolio
companies and management of our portfolio companies could make decisions adverse to our interests as debt investors.



We do not control or expect to control any of
our portfolio companies, even though it is possible that we could have board representation or board observation rights. As a result,
we are subject to the risk that a portfolio company in which we invest may make business decisions with which we disagree, and the management
of such company, as representatives of the holders of their common equity, may take risks or otherwise act in ways that do not serve
our interests as debt investors. As a result, a portfolio company may make decisions that could decrease the value of our portfolio holdings.



Economic recessions or downturns could impair our portfolio
companies and harm our operating results.



Many of our portfolio companies are susceptible
to economic or industry centric slowdowns or recessions and may be unable to repay our debt investments during these periods. Therefore,
our non-performing assets are likely to increase and the value of our portfolio is likely to decrease during these periods. Adverse economic
conditions may also decrease the value of any collateral securing investments in senior secured debt. Economic slowdowns or recessions
may further decrease the value of our collateral and result in losses of value in our portfolio and a material decrease in our revenues,
net income, assets and net worth. Unfavorable economic conditions also could increase our funding costs, limit our access to the capital
markets or result in a decision by our lenders not to extend credit to us on terms we deem acceptable. These events could prevent us
from increasing investments and materially harm our operating results.



A portfolio company’s failure to satisfy
financial or operating covenants imposed by us or other lenders could lead to defaults and, potentially, termination of its loans and
foreclosure on its secured assets, which could trigger cross-defaults under other agreements and jeopardize such portfolio company’s
ability to meet its obligations under debt securities that we hold. We may incur expenses to the extent necessary to seek recovery upon
default or to negotiate new terms with a defaulting portfolio company. In addition, if one of our portfolio companies were to go bankrupt,
even if we had structured our interest as senior debt, depending on the facts and circumstances, including the extent to which we actually
provided managerial assistance to that portfolio company, a bankruptcy court might re-characterize our debt holding and subordinate all
or a portion of our claim to that of other creditors.



A covenant breach by a portfolio company may harm our operating
results.



A portfolio company’s failure to satisfy
financial or operating covenants imposed by us or other lenders could lead to defaults and, potentially, termination of its debt and
foreclosure on its secured assets, which could trigger cross-defaults under other agreements and jeopardize a portfolio company’s
ability to meet its obligations under the debt securities that we hold. We may incur expenses to the extent necessary to seek recovery
upon default or to negotiate new terms with a defaulting portfolio company.



Global markets could enter a period of severe disruption and
instability due to catastrophic events, such as terrorist attacks, acts of war, natural disasters, and outbreaks of epidemic, pandemic
or contagious diseases, which could impair our portfolio companies’ financial positions and operating results and affect the industries
in which we invest and, in turn, harm our operating results





34







The U.S. and global markets have, from time to
time, experienced periods of disruption due to events such as terrorist attacks; acts of war; natural disasters, such as earthquakes,
tsunamis, fires, floods or hurricanes; and outbreaks of epidemic, pandemic or contagious diseases. Such events have created, and continue
to create, economic and political uncertainties and have contributed to recent global economic instability. The recent Russia/Ukraine
conflict and resulting economic sanctions may have significant effects on global markets and may exacerbate existing supply chain issues.
In addition, outbreaks of epidemic, pandemic or contagious diseases may also cause serious harm to our business, operating results and
financial condition. Historically, disease pandemics such as the Ebola virus, Middle East Respiratory Syndrome, Severe Acute Respiratory
Syndrome or the H1N1 virus, have diverted resources and priorities towards the treatment of such diseases. U.S. capital markets have
experienced extreme volatility and disruption following the global outbreak of a strain of novel coronavirus causing respiratory illness
(“COVID-19”) that emerged in December 2019, which has been identified as a global pandemic by the World Health Organization.
The COVID-19 pandemic continues to adversely impact global economic activity and has contributed to substantial instability in financial
markets. In response, governmental authorities in affected jurisdictions, including the United States, have implemented drastic measures,
including quarantines, “stay at home” orders, travel and hospitality restrictions and bans, and the temporary closures and
limited operations of many businesses (including corporate offices, retail stores, restaurants, fitness clubs, manufacturing facilities
and factories, and other businesses). COVID-19 effectively resulted in the cessation of all “non-essential” business activities
for a period of time. While certain state and local governments across the United States have taken steps to re-open their economies
by lifting “stay at home” orders and re-opening businesses, a number of states and local governments have needed to pause
or slow the re-opening or impose new shut-down orders due to a resurgence of COVID-19 cases and the emergence of more contagious strains
of the virus. In addition, although the U.S. Federal Food and Drug Administration has authorized COVID-19 vaccines for emergency use
starting in December 2020, it is unclear whether or how quickly “herd immunity” will be achieved. Even as the world
begins to recover from the COVID-19 pandemic, many major economies, including the U.S. economy, may continue to experience a period of
recession. We are closely monitoring the developments of COVID-19 and continually assessing the impact on our business and the business
of our portfolio companies, including the impact of the restrictions described above. Depending on the duration and magnitude of the
disruption to the business operations of our portfolio companies, we expect some portfolio companies, particularly those in industries
impacted more significantly by the pandemic, to experience financial distress and possibly to default on their financial obligations
to us and/or their other capital providers. Although it is impossible to predict the consequences of these governmental actions, it is
clear that these types of events are negatively impacting and will continue to negatively impact us and our portfolio companies in the
future.



Any prolonged disruptions in the business of our
portfolio companies, including a disruption in their supply chains may adversely affect their ability to obtain the necessary raw materials
or components to make their products or cause a decline in the demand for their products or services, leading to a negative impact on
their operating results. In addition, such events may lead to restrictions on travel to and from the affected areas, making it more difficult
for our portfolio companies to conduct their businesses. As a result of pandemic outbreaks, including the COVID-19 pandemic, businesses
can be shut down, supply chains can be interrupted, slowed, or rendered inoperable, and individuals can become ill, quarantined, or otherwise
unable to work and/or travel due to health reasons or governmental restrictions. Governmental mandates may require forced shutdowns of
our portfolio companies’ facilities for extended or indefinite periods. In addition, these widespread outbreaks of illness, particularly
in China, North America, Europe, or other locations significant to the operations of our portfolio companies, could adversely affect
their workforce, resulting in serious health issues and absenteeism, and may cause serious harm to our results of operations, business,
or prospects.



Furthermore, future terrorist activities, military
or security operations, natural disasters, disease outbreaks, pandemics or other similar events could further weaken the domestic/global
economies and create additional uncertainties, which may negatively impact our portfolio companies. During these periods of disruption,
general economic conditions may deteriorate with material and adverse consequences for the broader financial and credit markets, and
the availability of debt and equity capital for the market as a whole, and financial services firms in particular. Such economic adversity
could impair our portfolio companies’ financial positions and operating results and affect the industries in which we invest, which
could, in turn, harm our operating results. These conditions may reoccur for a prolonged period of time or materially worsen in the future.



Changes to U.S. tariff and import/export regulations may affect
our portfolio companies, and may negatively impact our business, results of operations or financial conditions.



The current U.S. administration has signified
potential significant changes to U.S. trade policies, treaties and tariffs, creating uncertainty about the future relationship between
the United States and other countries. These additional tax policy developments, or the perception that any of them could occur, may
have a material adverse effect on global economic conditions and the stability of global financial markets, and may significantly reduce
global trade. Any of these factors could dampen economic activity and limit our portfolio companies’ access to suppliers or customers,
resulting in a material adverse effect on their business, financial condition and results of operations, which in turn would negatively
impact us.





35









An investment strategy focused primarily on privately held companies
presents certain challenges, including the lack of available information about these companies.



We generally invest primarily in privately owned
U.S. companies. Investments in privately owned companies pose certain incremental risks as compared to investments in public companies.
For example, such private companies:



| | · | have reduced access to the capital markets, resulting in diminished capital resources and ability to withstand financial distress;
| | - | ----------------------------------------------------------------------------------------------------------------------------------



| | · | may have limited financial resources and may be unable to meet their obligations under the debt securities that we hold, which may
be accompanied by a deterioration in the value of any collateral and a reduction in the likelihood of us realizing on any guarantees we
may have obtained in connection with our investment;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | may have shorter operating histories, narrower product lines and smaller market shares than larger businesses, which tend to render
them more vulnerable to competitors’ actions and changing market conditions, as well as general economic downturns;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | are more likely to depend on the management talents and efforts of a small group of persons; therefore, the death, disability, resignation
or termination of one or more of these persons could have a material adverse impact on our portfolio company and, in turn, on us; and
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | may have less predictable operating results, may from time to time be parties to litigation, may be engaged in volatile businesses
with products subject to a substantial risk of obsolescence and may require substantial additional capital to support their operations,
finance expansion or maintain their competitive position.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Finally, little public information generally exists
about privately owned companies and these companies may not have third-party debt ratings or audited financial statements. We must therefore
rely on the ability of our Adviser to obtain adequate information through due diligence to evaluate the creditworthiness and potential
returns from investing in these companies. Additionally, these companies and their financial information are not generally subject to
the Sarbanes-Oxley Act of 2002, as amended, or the Sarbanes-Oxley Act, and other rules that govern public companies. If we are unable
to uncover all material information about these companies, we may not make a fully informed investment decision, and we may lose money
on our investments.



Our portfolio securities may be thinly traded and, as a result,
the lack of liquidity in our investments may adversely affect our business.



Investments in privately owned companies tend to
be less liquid. The securities of privately owned companies are not publicly traded or actively traded on the secondary market and are,
instead, traded on a privately negotiated over-the-counter secondary market for institutional investors. These privately negotiated over-the-counter
secondary markets may be inactive during an economic downturn or a credit crisis. In addition, the securities in these companies are subject
to legal and other restrictions on resale or are otherwise less liquid than publicly traded securities. Also, if there is no readily available
market for these investments, we carry these investments at fair value as determined by our Adviser. As a result, if we are required to
liquidate all or a portion of our portfolio quickly, we may realize significantly less than the value at which we had previously recorded
these investments. We may also face other restrictions on our ability to liquidate an investment in a portfolio company to the extent
that we, our Adviser or any of respective affiliates have material nonpublic information regarding such portfolio company or where the
sale would be an impermissible joint transaction. The reduced liquidity of our investments may make it difficult for us to dispose of
them at a favorable price, and, as a result, we may suffer losses.





36







We may hold the debt securities of leveraged companies that may,
due to the significant volatility of such companies, enter into bankruptcy proceedings.



Leveraged companies may experience bankruptcy or
similar financial distress. The bankruptcy process has a number of significant inherent risks. Many events in a bankruptcy proceeding
are the product of contested matters and adversary proceedings and are beyond the control of creditors. A bankruptcy filing by an issuer
may adversely and permanently affect the issuer. If such bankruptcy proceeding is converted to a liquidation, our value may not equal
the liquidation value that was believed to exist at the time of your investment. The duration of a bankruptcy proceeding is also difficult
to predict, and a creditor’s return on investment can be adversely affected by delays until the plan of reorganization or liquidation
ultimately becomes effective. The administrative costs of a bankruptcy proceeding are frequently high and would be paid out of the debtor’s
estate prior to any return to creditors. Because the standards for classification of claims under bankruptcy law are vague, our influence
with respect to the class of securities or other obligations we own may be lost by increases in the number and amount of claims in the
same class or by different classification and treatment. In the early stages of the bankruptcy process, it is often difficult to estimate
the extent of, or even to identify, contingent claims that might be made. In addition, certain claims that have priority by law (for example,
claims for taxes) may be substantial and may impair the recovery of other creditors.



The financial projections of our portfolio companies could prove
inaccurate.



We generally evaluate the capital structure of
portfolio companies on the basis of financial projections prepared by the management of such portfolio companies. These projected operating
results will normally be based primarily on judgments of the management of the portfolio companies. In all cases, projections are only
estimates of future results that are based upon assumptions made at the time that the projections are developed. General economic conditions,
which are not predictable with accuracy, along with other factors may cause actual performance to fall short of the financial projections
that were used to establish a given portfolio company’s capital structure. Because of the leverage that is typically employed by
our portfolio companies, this could cause a substantial decrease in the value of our investment in the portfolio company. The inaccuracy
of financial projections could thus cause our performance to fall short of our expectations.



Price declines in the corporate leveraged loan market may adversely
affect the fair value of our portfolio, reducing our net asset value through increased net unrealized depreciation.



Prior to the onset of the financial crisis that
began in 2007, securitized investment vehicles, hedge funds and other highly leveraged non-bank financial institutions comprised the majority
of the market for purchasing and holding senior, unitranche and subordinated debt. As the trading price of the loans underlying these
portfolios began to deteriorate beginning in the first quarter of 2007, we believe that many institutions were forced to raise cash by
selling their interests in performing assets in order to satisfy margin requirements or the equivalent of margin requirements imposed
by their lenders. This resulted in a cycle of forced deleveraging through price declines, compulsory sales and further price declines,
with falling underlying credit values, widespread redemption requests and other constraints resulting from the credit crisis generating
further selling pressure.



Conditions in the medium- and large-sized U.S.
corporate debt market may experience similar or worse disruption or deterioration in the future, which may cause pricing levels to decline
or be volatile. As a result, our net asset value could decline through an increase in unrealized depreciation and incurrence of realized
losses in connection with the sale of our investments. This, in turn, could have a material adverse impact on our business, financial
condition and results of operations.



We are exposed to risks associated with changes in interest rates.



The majority of our debt investments are floating
rates, based on a spread to LIBOR or the prime rate. General interest rate fluctuations may have a substantial negative impact on our
investments, including those with a LIBOR Floor. Any fluctuations in general interest rates would affect the reference rates used in the
interest calculation on our investment. Any of these fluctuations individually, or in the aggregate, may have an adverse impact on the
overall return of on our investments.





37







If general interest rates rise, there is a risk
that the portfolio companies in which we hold floating rate securities will be unable to pay escalating interest amounts, which could
result in a default under their loan documents with us. Rising interest rates could also cause portfolio companies to shift cash from
other productive uses to the payment of interest, which may have a material adverse effect on their business and operations and could,
over time, lead to increased defaults. In addition, rising interest rates may increase pressure on us to provide fixed rate loans to our
portfolio companies, which could adversely affect our net investment income, as increases in our cost of borrowed funds, if any, would
not be accompanied by increased interest income from such fixed-rate investments.



To the extent we borrow money to make investments,
our net investment income depends, in part, upon the difference between the rate at which we borrow funds and the rate at which we invest
those funds. As a result, we can offer no assurance that a significant change in market interest rates or a decrease in the spread between
the rate at which we borrow and the rate at which we invest will not have a material adverse effect on our net investment income to the
extent we use debt to finance investments. In periods of rising interest rates, our cost of funds would increase, which could reduce our
net investment income.



In
July 2017, the head of the United Kingdom Financial Conduct Authority announced that it intends to phase out the use of LIBOR by
the end of 2021. The ICE Benchmark Administration Limited, the administrator of LIBOR, subsequently announced that (i) it intends
to cease publication of 1-week and 2-month U.S. dollar LIBOR at the end of 2021 and (ii) subject to compliance with applicable regulations,
it intends to continue publication of the remaining U.S. dollar LIBOR tenors until June 30, 2023, effectively extending the LIBOR
transition period to June 30, 2023. There is currently no definitive information regarding the future utilization of LIBOR or of
any particular replacement rate.To identify a successor rate for U.S. dollar LIBOR, the Federal Reserve System, in conjunction
with the Alternative Reference Rates Committee, a steering committee comprised of large U.S. financial institutions, has identified the
Secured Overnight Financing Rate, or SOFR, as its preferred alternative rate for LIBOR. SOFR is a measure of the cost of borrowing cash
overnight, collateralized by U.S. Treasury securities, and is based on directly observable U.S. Treasury-backed repurchase transactions.
Other jurisdictions have also proposed their own alternative to LIBOR, including the Sterling Overnight Index Average for Sterling markets,
the Euro Short Term Rate for Euros and Tokyo Overnight Average Rate for Japanese Yens. Although SOFR appears to be the preferred replacement
rate for U.S. dollar LIBOR, at this time it is not possible to predict whether SOFR will attain market traction as a LIBOR replacement
tool or the effect of any such changes as the establishment of alternative reference rates or other reforms to LIBOR may be enacted in
the United States, United Kingdom or elsewhere. As such, the potential effect of SOFR and LIBOR on our net investment income cannot yet
be determined.



If
LIBOR ceases to exist, we may need to renegotiate the credit agreements extending beyond 2021 with our portfolio companies that utilize
LIBOR as a factor in determining the interest rate to replace LIBOR with the new standard that is established. We have generally included
in, or amended in to include in, our loan agreements with our portfolio companies fallback language providing a mechanism for the parties
to negotiate a new reference interest rate in the event that LIBOR ceases to exist.In addition, any further changes or reforms
to the determination or supervision of LIBOR may result in a sudden or prolonged increase or decrease in reported LIBOR, which could have
an adverse impact on the market value for or value of any LIBOR-linked securities, loans, and other financial obligations or extensions
of credit held by or due to us and could have a material adverse effect on our business, financial condition, tax position and results
of operations.



Our portfolio companies may incur debt that ranks equally with,
or senior to, our investments in such companies.



Our portfolio companies may have, or may be permitted
to incur, other debt that ranks equally with, or senior to, the debt in which we invest. By their terms, such debt instruments may entitle
the holders to receive payment of interest or principal on or before the dates on which we are entitled to receive payments with respect
to the debt instruments in which we invest. Also, in the event of the insolvency, liquidation, dissolution, reorganization or bankruptcy
of a portfolio company, holders of debt instruments ranking senior to our investment in that portfolio company would typically be entitled
to receive payment in full before we receive any distribution. After repaying such senior creditors, such portfolio company may not have
any remaining assets to repay its obligation to us. In the case of debt ranking equally with debt instruments in which we invest, we would
have to share on an equal basis any distributions with other creditors holding such debt in the event of an insolvency, liquidation, dissolution,
reorganization or bankruptcy of a portfolio company.





38







To the extent we make investments in restructurings and reorganizations
they may be subject to greater regulatory and legal risks than other traditional investments in portfolio companies.



We may make investments in restructurings that
involve, or otherwise invest in the debt securities of, companies that are experiencing or are expected to experience severe financial
difficulties. These severe financial difficulties may never be overcome and may cause such companies to become subject to bankruptcy proceedings.
As such, these investments could subject us to certain additional potential liabilities that may exceed the value of our original investment.
For instance, under certain circumstances, payments to us and our distributions to stockholders may be reclaimed if any such payment or
distribution is later determined to have been a fraudulent conveyance, preferential payment or similar transaction under applicable bankruptcy
and insolvency laws. Furthermore, investments in restructurings may be adversely affected by statutes relating to fraudulent conveyances,
voidable preferences, lender liability and a court’s discretionary power to disallow, subordinate or disenfranchise particular claims.
Under certain circumstances, a lender that has inappropriately exercised control of the management and policies of a debtor may have its
claims subordinated or disallowed, or may be found liable for damages suffered by parties as a result of such actions.



There may be circumstances where our debt investments are subordinated
to claims of other creditors, or we could be subject to lender liability claims.



If one of our portfolio companies were to go bankrupt,
depending on the facts and circumstances, including the extent to which we actually provided managerial assistance to that portfolio company
or a representative of us or our Adviser sat on the board of directors of such portfolio company, a bankruptcy court might re-characterize
our debt investment and subordinate all or a portion of our claim to that of other creditors. Bankruptcy courts weigh equitable considerations
when determining the recovery creditors may receive. As a result, it is difficult to predict with any certainty the situations in which
our legal rights may be subordinated to other creditors in a bankruptcy. For example, in situations where a bankruptcy carries a higher
degree of political or broader economic significance, our recovery may be adversely affected.



In addition, lenders in certain cases can be subject
to lender liability claims for actions taken by them when they become too involved in the borrower’s business or exercise control
over a borrower. It is possible that we could become subject to a lender’s liability claim, including as a result of actions taken
if we render significant managerial assistance to, or exercise control or influence over the board of directors of, the borrower.



We may not have the funds or ability to make additional investments
in our portfolio companies.



After our initial investment in a portfolio company,
we may be called upon from time to time to provide additional funds to such company or have the opportunity to increase our investment
through the exercise of a warrant or other right to purchase shares. There is no assurance that we will make, or will have sufficient
funds to make, follow-on investments. Even if we have sufficient capital to make a desired follow-on investment, we may elect not to make
a follow-on investment because we may not want to increase our level of risk, we prefer other opportunities, we are limited in our ability
to do so by compliance with BDC requirements, or we desire to maintain our RIC tax status. Our ability to make follow-on investments may
also be limited by our Adviser’s allocation policies. Any decisions not to make a follow-on investment or any inability on our part
to make such an investment may have a negative impact on a portfolio company in need of such an investment, may result in a missed opportunity
for us to increase our participation in a successful operation or may reduce the expected return on the investment.



Prepayments of our debt investments by our portfolio companies
could adversely impact our results of operations and reduce our return on equity.



We are subject to the risk that the investments
we make in our portfolio companies may be repaid prior to maturity. When this occurs, we will generally reinvest these proceeds in temporary
investments, pending their future investment in new portfolio companies. These temporary investments may have substantially lower yields
than the debt being prepaid, and we could experience significant delays in reinvesting these amounts. Alternative future investments in
new portfolio companies may also be at lower yields than the debt that was repaid and will, in any case, require additional Adviser time.
As a result, our results of operations could be materially adversely affected if one or more of our portfolio companies elect to prepay
amounts owed to us. Additionally, prepayments, net of prepayment fees, could negatively impact our return on equity.





39







To the extent OID or PIK constitutes a portion of our income,
we will be exposed to risks associated with the deferred receipt of cash representing such income.



Our investments may include instruments issued
with OID or PIK provisions. To the extent OID or PIK constitutes a portion of our income, we will be exposed to typical risks associated
with such income being required to be included in taxable and accounting income prior to receipt of cash, including:



| | · | instruments issued with OID may have unreliable valuations because the accruals require judgments about collectability.
| | - | -----------------------------------------------------------------------------------------------------------------------



| | · | instruments issued with OID may create heightened credit risks because the inducement to trade higher rates for the deferral of cash
payments typically represents, to some extent, speculation on the part of the borrower.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | for accounting purposes, cash distributions to stockholders derived from OID income are not considered to have been made from our
paid-in capital, although they may be paid from the proceeds of any offering of the Shares. Thus, although a distribution of OID income
comes from the cash invested by the stockholders, the 1940 Act does not require that stockholders be given notice of this fact.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | in the case of PIK “toggle” debt, a PIK election has the simultaneous effects of increasing the assets under management,
thereby increasing our base management fee, and increasing our investment income.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | OID creates risk of non-refundable cash payments to our Adviser based on non-cash accruals that may never be realized.
| | - | ----------------------------------------------------------------------------------------------------------------------



| | · | in addition, in the event we recognize deferred loan interest income in excess of our available capital as a result of our receipt
of PIK interest, we may be required to liquidate assets in order to pay a portion of the base management fee.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Risks Relating to the Shares



There is no public market for the Shares, and we do not expect
any market for the Shares to develop.



There is no existing trading market for the Shares.
We do not expect any market for the Shares to develop in the future or, if developed, such market may not be sustained. In the absence
of a trading market or unless we choose to conduct a tender offer, an investor may be unable to liquidate an investment in the Shares.



We may be unable to invest a significant portion of the net proceeds
of any offering of the Shares on acceptable terms in an acceptable timeframe.



Delays in investing the net proceeds of any offering
of the Shares may impair our performance. We cannot assure you we will be able to identify any investments that meet our investment objective
or that any investment that we make will produce a positive return. We may be unable to invest the net proceeds of any offering of the
Shares on acceptable terms within the time period that we anticipate or at all, which could harm our financial condition and operating
results.





40







Before investing our cash on hand, we will invest
such primarily in cash equivalents, U.S. government securities and other high-quality debt instruments maturing in one year or less from
the time of investment. This will produce returns that are significantly lower than the returns that we expect to achieve when our portfolio
is fully invested in securities meeting our investment objective. As a result, any distributions that we pay while our portfolio is not
fully invested in securities meeting our investment objective may be lower than the distributions that we may be able to pay when our
portfolio is fully invested in securities meeting our investment objective.



Risks Relating to Our Business and Structure



We have a limited operating history.



We were formed on January 29, 2015 and are
the first BDC to be advised by our Adviser. As a result, we are subject to all of the business risks and uncertainties associated with
any young business, including the risk that we will not achieve our investment objective. We take time to invest capital in part because
extending loans to middle-market borrowers requires substantial due diligence and structuring. We will invest any uninvested cash that
we hold in short-term investments, such as cash and cash equivalents, U.S. government securities and high-quality debt instruments maturing
in one year or less from the time of investment. As a result, we earn yields substantially lower than the interest income that we receive
in respect of loans to middle-market borrowers, and our distributions, if any, may be lower than the distributions that may be paid when
our portfolio is fully invested.



Our portfolio may be concentrated in a limited number of portfolio
companies and industries, which will subject us to a risk of significant loss if any of these companies defaults on its obligations under
any of its debt instruments or if there is a downturn in a particular industry.



Although we do not intend to focus our investments
in any specific industries, our portfolio may be concentrated in a limited number of portfolio companies and industries. Beyond the asset
diversification requirements associated with our qualification as a RIC under Subchapter M of the Code, we do not have fixed guidelines
for diversification; while we do not target any specific industries, our investments may be concentrated in relatively few industries.
As a result, the aggregate returns we realize may be significantly adversely affected if a small number of investments perform poorly
or if we need to write down the value of any one investment. Additionally, a downturn in any particular industry in which we are invested
could also significantly impact the aggregate returns we realize.



Because our business model depends to a significant extent upon
relationships with corporations, financial institutions and investment firms, the inability of our Adviser to maintain or develop these
relationships, or the failure of these relationships to generate investment opportunities, could adversely affect our business.



Our Adviser depends on its relationships with corporations,
financial institutions and investment firms, and we rely indirectly to a significant extent upon these relationships to provide us with
potential investment opportunities. If our Adviser fails to maintain its existing relationships or develop new relationships or sources
of investment opportunities, we may not be able to grow our investment portfolio. In addition, individuals with whom our Adviser has relationships
are not obligated to provide us with investment opportunities. Therefore, we can offer no assurance that such relationships will generate
investment opportunities for us.



We may face increasing competition for investment opportunities,
which could delay deployment of our capital, reduce returns and result in losses.



We compete for investments with other BDCs and
investment funds (including registered investment companies, private equity funds and mezzanine funds), as well as traditional financial
services companies such as commercial and investment banks and other sources of funding, such as issuers of collateral loan obligations
and other structured loan funds. Moreover, alternative investment vehicles, such as hedge funds, have begun to invest in areas in which
they have not traditionally invested, including making investments in our target market of privately owned U.S. companies. As a result
of these new entrants, competition for investment opportunities in privately owned U.S. companies could intensify. Many of our competitors
are substantially larger and have considerably greater financial, technical and marketing resources than we do. For example, some competitors
may have a lower cost of capital and access to funding sources that are not available to us. In addition, some of our competitors may
have higher risk tolerances or different risk assessments than we have. These characteristics could allow our competitors to consider
a wider variety of investments, establish more relationships and offer prospective borrowers better pricing and more flexible structuring
than we are able to do.





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We may lose investment opportunities if we do not
match our competitors’ pricing, terms and structure criteria. If we are forced to match these criteria to make investments, we may
not be able to achieve acceptable returns on our investments or lose capital. Any increase in the number and/or the size of our competitors
could force us to accept less attractive investment terms or not lend. Furthermore, many of our competitors are not subject to the regulatory
restrictions that the 1940 Act imposes on us as a BDC or the source of income, asset diversification and distribution requirements we
must satisfy to maintain our RIC status. Such competitive pressures may adversely affect our business, financial condition, results of
operations and cash flows. As a result of this competition, we may not be able to take advantage of attractive investment opportunities
from time to time. Also we may not be able to identify and make investments that are consistent with our investment objective.



We may not be able to pay you distributions, and our distributions
may not grow over time.



Subject
to the discretion of our Board of Directors and applicable legal restrictions, we intend to make distributions to our stockholders out
of assets legally available for distribution. We cannot assure you that we will achieve investment results that will allow us to make
a specified level of cash distributions or to increase our cash distributions in the future.All distributions will be paid at
the discretion of our Board of Directors and will depend on our earnings, our net investment income, our financial condition, maintenance
of our RIC tax status, compliance with applicable BDC regulations and such other factors as our Board of Directors may deem relevant from
time to time.



We may need to raise additional capital to grow because we must
distribute most of our income.



We may need additional capital to fund growth in
our investments. A reduction in the availability of new capital could limit our ability to grow. We must distribute dividends each taxable
year of an amount generally at least equal to 90% of our investment company taxable income, determined without regard to any deduction
for dividends paid, to our stockholders to maintain our ability to be subject to tax as a RIC. As a result, any such cash earnings may
not be available to fund investment originations. We expect to issue equity securities in private offerings. If we fail to obtain funds
from such sources or from other sources to fund our investments, it could limit our ability to grow, which may have an adverse effect
on the value of our securities. In addition, our ability to borrow or issue additional preferred stock may be restricted if our total
assets are less than the required asset coverage ratio under the 1940 Act, currently 200% (or 150% upon receipt of certain approvals and
subject to certain disclosure requirements) of total borrowings and preferred stock.



A significant portion of our investment portfolio is recorded
at fair value as determined in good faith by our Board of Directors and, as a result, there is uncertainty as to the value of our portfolio
investments.



We carry our portfolio investments at market value
or, if there is no readily available market value, at fair value. There is no public market or active secondary market for many of the
securities of the privately held companies in which we have invested. The majority of our investments are not publicly traded or actively
traded on a secondary market but, instead, may be traded on a privately negotiated over-the-counter secondary market for institutional
investors. As a result, we value these securities quarterly at fair value as determined in good faith by our Board of Directors.



The determination of fair value, and thus the amount
of unrealized losses we may incur in any year, is to a degree subjective. We value these securities quarterly at fair value as determined
in good faith by our Board of Directors, which may rely on the services of our Adviser. The types of factors that may be considered in
determining the fair values of our investments include the nature and realizable value of any collateral, the portfolio company’s
ability to make payments and its earnings, the markets in which the portfolio company does business, comparison to publicly traded companies,
discounted cash flow, current market interest rates and other relevant factors. Because such valuations, and particularly valuations of
private securities and private companies, are inherently uncertain, they may fluctuate significantly over short periods of time due to
changes in market conditions. The determinations of fair value by our Board of Directors may differ materially from the values that would
have been used if an active market and market quotations existed for these investments. Our net asset value could be adversely affected
if the determinations regarding the fair value of our investments were materially higher than the values that we ultimately realize upon
the disposal of such investments.





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Our distribution proceeds may exceed our earnings, particularly
during the period before we have substantially invested the net proceeds from any offering of the Shares. We have not established any
limit on the extent to which we may use proceeds from any offering of the Shares to fund distributions, which may reduce the amount of
capital we ultimately invest in assets.



We expect to pay distributions out of assets legally
available for distribution. In the event that we encounter delays in locating suitable investment opportunities, we may pay our distributions
from the proceeds of any offering of the Shares in anticipation of future cash flow, which may constitute a return of your capital. Distributions
from the proceeds of any offering of the Shares also could reduce the amount of capital we ultimately invest in portfolio companies. Accordingly,
stockholders who receive the payment of a distribution from us should not assume that such distribution is the result of a net profit
earned by us.



Our Adviser may change our operating policies and strategies
without prior notice or stockholder approval, the effects of which may be adverse to our stockholders.



Our Adviser has the authority to modify or waive
our operating policies, investment criteria and strategies without prior notice and without stockholder approval. We cannot predict the
effect any changes to our current operating policies, investment criteria and strategies would have on our business, net asset value,
operating results and the value of the Shares. However, the effects might be adverse, which could negatively impact our ability to pay
you distributions and cause you to lose all or part of your investment. Moreover, we will have significant flexibility in investing the
net proceeds of any offering of the Shares and may use the net proceeds from any offering of the Shares in ways with which investors may
not agree.



We are subject to risks associated with cybersecurity and cyber
incidents which may adversely affect our business by causing a disruption to our operations, a compromise or corruption of our confidential
information and/or damage to our business relationships, all of which could negatively impact our business, financial condition and operating
results.



Our business relies on secure information technology
systems. These systems are subject to potential attacks, including through adverse events that threaten the confidentiality, integrity
or availability of our information resources (i.e., cyber incidents). These attacks could involve gaining unauthorized access to our information
systems for purposes of misappropriating assets, stealing confidential information, corrupting data or causing operational disruption
and result in disrupted operations, misstated or unreliable financial data, liability for stolen assets or information, increased cybersecurity
protection and insurance costs, litigation and damage to our business relationships, any of which could have a material adverse effect
on our business, financial condition and results of operations. As our reliance on technology has increased, so have the risks posed to
our information systems, both internal and those provided by the Adviser and third-party service providers. While we, along with our Adviser,
have implemented processes, procedures and internal controls seeking to mitigate cybersecurity risks and cyber intrusions, these measures
may be ineffective and do not guarantee that a cyber incident will not occur or that our financial results, operations or confidential
information will not be negatively impacted by such an incident.



Price declines and illiquidity in the corporate debt markets
may adversely affect the fair value of our portfolio investments, reducing our net asset value through increased net unrealized depreciation.



We carry our investments at market value or, if
no market value is ascertainable, at fair value. A decrease in the market values or fair values of our investments is recorded as unrealized
depreciation. Declines in prices and liquidity in the corporate debt markets may result in significant net unrealized depreciation in
our portfolio, reducing their net asset value. Depending on market conditions, we could incur substantial realized losses and may suffer
additional unrealized losses in future periods, which could have a material adverse impact on our business, financial condition and results
of operations and our net asset value.





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We are subject to risks in using custodians and other agents.



We depend on the services of custodians or other
agents to carry out certain securities transactions and administrative services for us. In the event of the insolvency of a custodian,
we may not be able to recover equivalent assets in full as we will rank among the custodian’s unsecured creditors in relation to
assets which the custodian borrows, lends or otherwise uses. In addition, our cash held with a custodian may not be segregated from the
custodian’s own cash, and we therefore may rank as unsecured creditors in relation thereto. Any inability to recover assets from
the custodian could have a material impact on our performance.



Uncertainty about administration initiatives of the U.S. presidential
administration could negatively impact our business, financial condition and results of operations.



The current U.S. administration has expressed
the intent to make significant changes to U.S. taxation, trade, healthcare, climate change, immigration, foreign and government regulatory
policies. In this regard, there is significant uncertainty with respect to legislation, regulation and government policy at the federal
level, as well as the state and local levels. Recent events have created a climate of heightened uncertainty and introduced new and difficult-to-quantify
macroeconomic and political risks with potentially far-reaching implications. There has been a corresponding meaningful increase in the
uncertainty surrounding interest rates, inflation, foreign exchange rates, trade volumes and fiscal and monetary policy. To the extent
the U.S. Congress or the current U.S. administration implements changes to U.S. policy, those changes may impact, among other things,
the U.S. and global economy, international trade and relations, unemployment, immigration, federal income and other taxes, energy production,
healthcare, the U.S. regulatory environment, inflation and other areas. Although we cannot predict the impact, if any, of these changes
to our business, they could adversely affect our business, financial condition, operating results and cash flows. Until we know what policy
changes are made and how those changes impact our business and the business of our competitors over the long term, we will not know if,
overall, we will benefit from them or be negatively affected by them.



Global economic, political and market conditions may adversely
affect our business, results of operations and financial condition, including our revenue growth and profitability.



The current worldwide financial market situation,
the ongoing Russia/Ukraine conflict and related sanctions, as well as growing social and political tensions in the United States and around
the world, may contribute to increased market volatility, may have long-term effects on the United States and worldwide financial markets,
and may cause economic uncertainties or deterioration in the United States and worldwide through economic sanctions and otherwise.



As a consequence of the United Kingdom’s
vote to withdraw from the European Union, the government of the United Kingdom gave notice of its withdrawal from the European Union,
commonly referred to as “Brexit”. The United Kingdom exited from the European Union on January 31, 2020. A new Trade
and Cooperation Agreement reached between the European Union and United Kingdom in late 2020 is untested and may lead to ongoing political
and economic uncertainty and periods of exacerbated volatility in both the United Kingdom and in wider European and global markets for
some time. Additional risks associated with the outcome of Brexit include macroeconomic risk to the United Kingdom and European economies,
impetus for further disintegration of the European Union and related political stresses (including those related to sentiment against
cross border capital movements and activities of investors like us), prejudice to financial services business that are conducting business
in the European Union and which are based in the United Kingdom, legal uncertainty regarding achievement of compliance with applicable
financial and commercial laws and regulations, and the unavailability of timely information as to expected legal, tax and other regimes.
Any further exits from the European Union, or the possibility of such exits, would likely cause additional market disruption globally
and introduce new legal and regulatory uncertainties. In addition, continuing signs of deteriorating sovereign debt conditions in Europe
and an economic slowdown in China create uncertainty that could lead to further disruptions, instability and weakening consumer, corporate
and financial confidence. We may in the future have difficulty accessing debt and equity capital markets, and a severe disruption in the
global financial markets, deterioration in credit and financing conditions or uncertainty regarding U.S. government spending and deficit
levels, Brexit, European sovereign debt, or other global economic conditions could have a material adverse effect on our business, financial
condition and results of operations.





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Risks Related to our Adviser and its Affiliates



Our Adviser and its affiliates, including our officers and some
of our directors, could face conflicts of interest caused by compensation arrangements with us, which could result in actions that are
not in the best interests of our stockholders.



Many of our portfolio investments are and are expected
to be made in the form of securities that are not publicly traded. As a result, our Board of Directors determines the fair value of these
securities in good faith. In connection with that determination, our Adviser may provide our Board of Directors with valuations based
upon the most recent portfolio company financial statements available and projected financial results of each portfolio company. In addition,
certain of our Investment Committee members that are not on our Board of Directors have an indirect pecuniary interest in our Adviser.
The participation of our Adviser in our valuation process, and the indirect pecuniary interest in our Adviser of certain of our Investment
Committee members, could result in a conflict of interest because the base management fee is based, in part, on our gross assets, and
our incentive fees are based, in part, on unrealized depreciation.



The part of the management and incentive fees payable
to our Adviser that relates to our net investment income is computed and paid on income that may include interest income that has been
accrued for GAAP (without any adjustments) but not yet received in cash, such as OID, debt instruments with PIK interest, interest and
zero coupon securities. This fee structure may be considered to involve a conflict of interest for our Adviser to the extent that it may
encourage our Adviser to favor debt financings that provide for deferred interest, rather than current cash payments of interest. Our
Adviser may have an incentive to invest in deferred interest securities in circumstances where it would not have done so but for the opportunity
to continue to earn the fees even when the issuers of the deferred interest securities would not be able to make actual cash payments
to us on such securities. This risk could be increased because our Adviser is not obligated to reimburse us for any fees received even
if we subsequently incur losses or never receive in cash the deferred income that was previously accrued.



The Investment Advisory Agreement and the Administration Agreement
were not negotiated on an arm’s length basis and may not be as favorable to us as if they had been negotiated with an unaffiliated
third party.



Because the sole stockholder of the Company at
the time of the negotiations was an affiliate of our Adviser and our Administrator, the Investment Advisory Agreement and the Administration
Agreement were negotiated between related parties. Consequently, while the terms of each were subject to approval by our Board of Directors,
including a majority of independent directors, such terms, including the advisory fees payable under the Investment Advisory Agreement
may not be as favorable to us as if they had been negotiated with an unaffiliated third party.



Our Adviser’s liability is limited under
the Investment Advisory Agreement, and we are required to indemnify our Adviser against certain liabilities, which may lead our Adviser
to act in a riskier manner on our behalf than it would when acting for its own account.



Our Adviser does not assume any responsibility
to us other than to render the services described in the Investment Advisory Agreement, and it will not be responsible for any action
of our Board of Directors in declining to follow our Adviser’s advice or recommendations.



The time and resources that individuals associated with our Adviser
devote to us may be diverted, and we may face additional competition due to the fact that our Adviser is not prohibited from raising money
for or managing other entities that make the same types of investments that we target.



Our Adviser is not prohibited from raising money
for and managing future investment entities that make the same types of investments as those we target. As a result, the time and resources
that our Adviser devotes to us may be diverted. During times of intense activity in other programs, our Adviser may devote less time and
resources to our business than is necessary or appropriate. In addition, we will compete with such other entities for the same investors
and investment opportunities. We may co-invest with such investment entities only to the extent permitted by the 1940 Act, the rules and
regulations under the 1940 Act and the exemptive relief under the 1940 Act that we, the Adviser and other affiliates received from the
SEC. However, even with such exemptive relief, we are unable to participate in certain transactions originated by our Adviser or its affiliates.
Affiliates of our Adviser, whose primary business includes the origination of investments, engage in investment advisory businesses with
accounts that compete with us. Affiliates of our Adviser have no obligation to make their originated investment opportunities available
to us.





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We may be obligated to pay our Adviser incentive compensation
even if we incur a loss.



Our Adviser is entitled to incentive compensation
for each calendar quarter in an amount equal to a percentage of the excess of our pre-incentive fee net investment income for that quarter
(before deducting incentive compensation) above a performance threshold for that quarter. Our pre-incentive fee net investment income
for incentive compensation purposes excludes realized and unrealized capital losses and depreciation that we may incur in the calendar
quarter, even if such capital losses or depreciation result in a net loss on our statement of operations for that quarter. Thus, we may
be required to pay incentive compensation for a calendar quarter even if there is a decline in the value of our portfolio or we incur
a net loss for that quarter, subject to the deferral provisions. See “Item 1. Business — Investment Advisory Agreement.”



We may make investments that could give rise to a conflict of
interest.



We do not invest in, or hold securities of, companies
that are controlled by our affiliates’ other clients. However, our affiliates’ other clients may invest in, and gain control
over, one of our portfolio companies. If our affiliates’ other client or clients gain control over one of our portfolio companies,
this may create conflicts of interest and subject us to certain restrictions under the 1940 Act. As a result of these conflicts and restrictions,
our Adviser may be unable to implement our investment strategies as effectively as they could have in the absence of such conflicts or
restrictions. For example, as a result of a conflict or restriction, our Adviser may be unable to engage in certain transactions that
they would otherwise pursue. In order to avoid these conflicts and restrictions, our Adviser may choose to exit these investments prematurely
and, as a result, we may forego positive returns associated with such investments. In addition, to the extent that another client holds
a different class of securities than us as a result of such transactions, our interests may not be aligned. Our ability to enter into
transactions with our affiliates may be restricted.



As a BDC, we are prohibited under the 1940 Act
from participating in transactions with certain of our affiliates without the prior approval of a majority of the independent directors
and, in some cases, the SEC. Any person that owns, directly or indirectly, 5% or more of our outstanding voting securities is our affiliate
for purposes of the 1940 Act, and we are generally prohibited from buying or selling any securities from or to such affiliate, absent
the prior approval of our Board of Directors. The 1940 Act also prohibits certain “joint” transactions with certain of our
affiliates, which in certain circumstances could include investments in the same portfolio company (whether at the same or different times
to the extent the transaction involves jointness), without prior approval of our Board of Directors and, in some cases, the SEC. If a
person acquires more than 25% of our voting securities, we will be prohibited from buying or selling any security from or to such person
or certain of that person’s affiliates, or entering into prohibited joint transactions with such persons, absent the prior approval
of the SEC. Similar restrictions limit our ability to transact business with our officers or directors or their affiliates. The SEC has
interpreted the BDC regulations governing transactions with affiliates to prohibit certain “joint transactions” involving
entities that share a common investment adviser or have investment advisers under common control. As a result of these restrictions, we
may be prohibited from buying or selling any security from or to any portfolio company that is controlled by a fund managed by our Adviser
or its respective affiliates except under certain circumstances or with the prior approval of the SEC, which may limit the scope of investment
opportunities that would otherwise be available to us.



We may, however, invest alongside our Adviser’s
and/or its affiliates’ other clients, in certain circumstances where doing so is consistent with applicable law and SEC staff interpretations,
guidance and exemptive relief orders. However, we can offer no assurance that investment opportunities will be allocated to us fairly
or equitably in the short-term or over time or that there may not be inadvertent errors in the application of our Adviser’s allocation
policy.



We, the Adviser, and other affiliates have received
exemptive relief that permits us flexibility to negotiate the terms of co-investments if our Board of Directors determines that it would
be advantageous for us to co-invest with other accounts sponsored or managed by our Adviser or its affiliates in a manner consistent with
our investment objective, positions, policies, strategies and restrictions, as well as regulatory requirements and other relevant factors.
We cannot assure you, however, that we will continue to develop opportunities that comply with such limitations.





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In situations where co-investment with our affiliates’
other clients is not permitted under the 1940 Act and related rules, existing or future staff guidance or the terms and conditions of
exemptive relief granted to our Adviser and its affiliates by the SEC, our Adviser will need to decide which client or clients will proceed
with the investment. Generally, we will not be entitled to make a co-investment in these circumstances and, to the extent that another
client elects to proceed with the investment, we will not be permitted to participate. Moreover, except in certain circumstances, we will
be unable to invest in any issuer in which an affiliates’ other client holds a controlling interest. These restrictions may limit
the scope of investment opportunities that would otherwise be available to us.



Our ability to achieve our investment objective depends on our
Adviser’s ability to manage and support our investment process. If our Adviser were to lose its key professional(s), our ability
to achieve our investment objective could be significantly harmed.



We have no internal management capacity or employees
other than our appointed executive officers and depend upon the investment expertise, skill and network of business contacts of our Adviser
to achieve our investment objective. Our Adviser evaluates, negotiates, structures, executes, monitors and services our investments. Our
future success will depend to a significant extent on the continued service and coordination of our Adviser’s senior investment
professionals. The departure of a significant number of our Adviser’s senior investment professionals could have a material adverse
effect on our ability to achieve our investment objective.



Our ability to achieve our investment objective
also depends on our Adviser’s ability to identify, analyze, invest in, finance and monitor companies that meet our investment criteria.
Our Adviser’s capabilities in structuring the investment process, providing competent, attentive and efficient services to us and
facilitating access to financing on acceptable terms depend on the involvement of investment professionals in an adequate number and of
adequate sophistication to handle the flow of transactions. To achieve our investment objective, our Adviser will need to retain, hire,
train, supervise and manage new investment professionals to participate in our investment selection and monitoring process. Our Adviser
may not be able to find qualified investment professionals in a timely manner or at all. Any failure to do so could have a material adverse
effect on our business, financial condition and results of operations.



Risks Related to our Election to be Regulated as a BDC and Subject
to Tax as a RIC



We are regulated as a BDC, and we have elected
to be treated as a RIC under the Code. Accordingly, you should carefully consider the risks below.



We are subject to corporate-level income tax if we are unable
to qualify as a RIC under Subchapter M of the Code or to satisfy RIC distribution requirements.



In order for us to qualify for and maintain RIC
tax treatment under the Code, we must maintain our election with the SEC to be treated as a BDC under the 1940 Act as well as meet the
Annual Distribution Requirement, the 90% Income Test and the Diversification Tests. See “Item 1. Business — Material U.S.
Federal Income Tax Considerations.”



The Annual Distribution Requirement is satisfied
if we distribute dividends to our stockholders each taxable year of an amount generally at least equal to 90% of our investment company
taxable income, determined without regard to the deduction for any dividends paid. We are subject to tax on any retained investment company
taxable income and/or net capital gains. We must also satisfy an additional annual distribution requirement in respect of each calendar
year in order to avoid a 4% excise tax on the amount of any under-distribution. Although we do not intend to use debt financing in the
near term, we are subject to an asset coverage ratio requirement under the 1940 Act and may in the future become subject to restrictions
from making distributions necessary to satisfy the distribution requirements. If we are unable to obtain cash from other sources, we could
fail to qualify for RIC tax treatment, or could be required to retain a portion of our income or gains, and thus become subject to corporate-level
income tax.





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The 90% Income Test is satisfied if we earn at
least 90% of our gross income each taxable year from dividends, interest, gains from the sale of stock or securities, or qualifying sources.



The Diversification Tests are satisfied if we meet
certain asset composition requirements at the end of each quarter of our taxable year. To satisfy this requirement, at least 50% of the
value of our assets must consist of cash, cash equivalents, U.S. government securities, securities of other RICs, and other acceptable
securities; and no more than 25% of the value of our assets can be invested in the securities, other than U.S. government securities or
securities of other RICs, of one issuer, of two or more issuers that are controlled, as determined under applicable Code rules, by us
and that are engaged in the same or similar or related trades or businesses or of certain “qualified publicly traded partnerships.”
Failure to meet these requirements may result in our having to dispose of certain investments quickly in order to prevent the loss of
RIC status. Because most of our investments are in private companies, and therefore are relatively illiquid, any such dispositions could
be made at disadvantageous prices and could result in substantial losses.



If we fail to qualify for or maintain RIC tax treatment
for any reason and are subject to corporate income tax, the resulting corporate taxes could substantially reduce our net assets, the amount
of income available for distribution, and the amount of our distributions.



Our distribution proceeds may exceed our earnings, particularly
during the period before we have substantially invested the net proceeds from any offering of the Shares. We have not established any
limit on the extent to which we may use proceeds from any offering of the Shares to fund distributions, which may reduce the amount of
capital we ultimately invest in assets.



We expect to pay distributions out of assets legally
available for distribution. In the event that we encounter delays in locating suitable investment opportunities, we may pay our distributions
from the proceeds of any offering of the Shares in anticipation of future cash flow, which may constitute a return of your capital. Distributions
from the proceeds of any offering of the Shares also could reduce the amount of capital we ultimately invest in portfolio companies. Accordingly,
stockholders who receive the payment of a distribution from us should not assume that such distribution is the result of a net profit
earned by us.



We may choose to pay distributions in the form of the Shares,
in which case our investors may be required to pay federal income taxes in cash in excess of the cash distributions they receive.



We may distribute taxable dividends that are payable
in cash or the Shares at the election of each investor. Under certain applicable provisions of the Code and the Treasury regulations,
distributions payable in cash or the Shares at the election of investors are treated as taxable dividends. If we decide to make any distributions
consistent with these rulings that are payable in part in the Shares, taxable investors receiving such dividends will be required to include
the full amount of the dividend (whether received in cash, the Shares, or a combination of cash and the Shares) as ordinary income (or
as long-term capital gain to the extent such distribution is properly reported as a capital gain dividend) to the extent of our current
and accumulated earnings and profits for U.S. federal income tax purposes. As a result, a U.S. investor may be required to pay tax with
respect to such dividends in excess of any cash received. If a U.S. investor sells the Shares it receives as a dividend in order to pay
this tax, the sales proceeds may be less than the amount included in income with respect to the dividend, depending on the market price
of the Shares at the time of the sale. Furthermore, with respect to non-U.S. stockholders, we may be required to withhold U.S. tax with
respect to such dividends, including in respect of all or a portion of such dividend that is payable in the Shares. In addition, if a
significant number of our stockholders determine to sell the Shares in order to pay taxes owed on dividends, it may put downward pressure
on the trading price of the Shares.



If we do not qualify as a “publicly offered regulated investment
company,” as defined in the Code, certain investors will be taxed as though they received a distribution of some of our expenses.



A “publicly offered regulated investment
company” is a RIC whose shares are either (1) continuously offered pursuant to a public offering, (2) regularly traded
on an established securities market or (3) held by at least 500 persons at all times during the taxable year. We do not expect to
qualify as a publicly offered RIC for any period. As a result, a non-corporate U.S. stockholder’s allocable portion of our affected
expenses is treated as an additional deemed distribution to the stockholder and is deductible by such stockholder only to the extent permitted
under the limitations described below. For non-corporate U.S. stockholders, including individuals, trusts and estates, significant limitations
generally apply to the deductibility of certain expenses of a non-publicly offered RIC. In particular, for taxable years beginning after
2025, these expenses, referred to as miscellaneous itemized deductions, are deductible to a U.S. individual only to the extent they exceed
2% of such stockholder’s adjusted gross income, are not deductible for AMT purposes and are subject to the overall limitation on
itemized deductions under Section 68 of the Code. For taxable years beginning after 2017 and prior to 2026, miscellaneous itemized
deductions are disallowed in their entirety.





48







We may have difficulty paying our required distributions if we
recognize income before or without receiving cash representing such income.



For U.S. federal income tax purposes, we may be
required to recognize taxable income in circumstances in which we do not receive a corresponding payment in cash. For example, if we hold
debt obligations that are treated under applicable tax rules as having OID, such as debt instruments with PIK interest or, in certain
cases, increasing interest rates or debt instruments that were issued with warrants, we must include in income a portion of the OID that
accrues over the life of each debt obligation in determining our taxable income, regardless of whether cash representing such income is
received by us in the same taxable year. We may also have to include in income other amounts that we have not yet received in cash, such
as deferred loan origination fees that are paid after origination of the loan or are paid in non-cash compensation such as warrants or
stock. Furthermore, we may invest in non-U.S. corporations (or other non-U.S. entities treated as corporations for U.S. federal income
tax purposes) that could be treated under the Code and Treasury regulations as “passive foreign investment companies” and/or
 “controlled foreign corporations.” The rules relating to investment in these types of non-U.S. entities are designed
to ensure that U.S. taxpayers are either, in effect, taxed currently (or on an accelerated basis with respect to corporate level events)
or taxed at increased tax rates at distribution or disposition. In certain circumstances this could require us to recognize income where
we do not receive a corresponding payment in cash. Further, we may elect to amortize market discount and include such amount currently
in our taxable income, instead of upon disposition, as an election not to do so would limit our ability to deduct interest expense for
tax purposes.



Because any OID or other amounts accrued will be
included in our investment company taxable income for the year of the accrual, we may be required to make a distribution to our stockholders
in order to satisfy the Annual Distribution Requirement, even if we will not have received any corresponding cash amount. As a result,
we may have difficulty meeting the Annual Distribution Requirement necessary to obtain and maintain RIC tax treatment under the Code.
We may have to sell some of our investments at times and/or at prices we would not consider advantageous, raise additional equity capital,
make a partial share distribution, or forgo new investment opportunities for this purpose. If we are not able to obtain cash from other
sources, and choose not to make a qualifying share distribution, we may fail to qualify for RIC tax treatment and thus become subject
to corporate-level income tax.



The requirement that we, as a BDC, invest a sufficient portion
of our assets in qualifying assets could preclude us from investing in accordance with our current business strategy; conversely, any
failure on our part to invest a sufficient portion of our assets in qualifying assets could cause us to lose our status as a BDC.



As a BDC, the 1940 Act prohibits us from acquiring
any assets other than certain “qualifying assets,” as defined in the 1940 Act, unless, at the time of and after giving effect
to such acquisition, at least 70% of our total assets are qualifying assets. Therefore, we may be precluded from investing in what we
believe are attractive investments if such investments are not qualifying assets. Conversely, if we fail to invest a sufficient portion
of our assets in qualifying assets, we could lose our status as a BDC, which would have a material adverse effect on our business, financial
condition, and result of operations. Similarly, these rules could prevent us from making additional investments in existing portfolio
companies, which could result in the dilution of our position.



Failure to maintain our status as a BDC would reduce our operating
flexibility.



If we do not remain a BDC, we could be subject
to regulation as a registered closed-end investment company under the 1940 Act, which would subject us to substantially more regulatory
restrictions and correspondingly decrease our operating flexibility.





49







Any failure to comply with the requirements imposed
on BDCs by the 1940 Act could cause the SEC to bring an enforcement action against us and/or expose us to claims of private litigants.
In addition, upon approval of a majority of our stockholders, we may elect to withdraw our status as a BDC. If we decide to withdraw our
election, or if we otherwise fail to qualify, or maintain our qualification, as a BDC, we may be subject to substantially greater regulation
under the 1940 Act as a closed-end investment company. Compliance with such regulations would significantly decrease our operating flexibility,
and could significantly increase our costs of doing business.



The SBCAA allows us to incur additional leverage and would require
us to offer liquidity to our stockholders.



Under the 1940 Act, a BDC generally is required
to maintain asset coverage of 200% for senior securities representing indebtedness (such as borrowings from banks or other financial institutions)
or stock (such as preferred stock). The SBCAA, which was signed into law on March 23, 2018, provides that a BDC’s required
asset coverage under the 1940 Act may be reduced from 200% (equivalent of $1 of debt outstanding for each $1 equity) to 150% (equivalent
to $2 of debt outstanding for each $1 of equity). This reduction in asset coverage would permit a BDC to double the amount of leverage
it may utilize, subject to certain approval, timing and reporting requirements, including either stockholder approval or approval of a
majority of the directors who are not “interested persons” (as defined in the 1940 Act) of the BDC and who have no financial
interest in the arrangement. As a result, if we were to seek and receive the relevant approval, and we complied with the applicable disclosure
requirements, we would be able to incur additional leverage, which may increase the risk of investing in us. In addition, since our base
management fee is payable based upon our average adjusted gross assets, which includes any borrowings for investment purposes, our base
management fee expenses may increase if we incur additional leverage.



As a non-traded BDC, if we receive the relevant approval to increase
our authorized leverage, we will be required to offer our stockholders the opportunity to sell their shares of common stock over the next
year following the calendar quarter in which the approval was obtained.



Efforts to comply with the Sarbanes-Oxley Act involve significant
expenditures.



We are subject to the Sarbanes-Oxley Act and the
related rules and regulations promulgated by the SEC. These requirements may place a strain on our systems and resources. The Exchange
Act requires that we file annual, quarterly and current reports with respect to our business and financial condition. The Sarbanes-Oxley
Act requires that we maintain effective disclosure controls and procedures and internal controls over financial reporting, which are discussed
below. In order to maintain and improve the effectiveness of our disclosure controls and procedures and internal controls, significant
resources and management oversight are required. We have implemented, and expect to continue to implement, procedures, processes, policies
and practices for the purpose of addressing the standards and requirements applicable to public companies. As a result, we expect to incur
significant additional expenses, which may negatively impact our financial performance and our ability to make distributions. This process
also will result in a diversion of our management’s time and attention. We do not know when our evaluation, testing and remediation
actions will be completed or its impact on our operations. In addition, we may be unable to ensure that the process is effective or that
our internal controls over financial reporting are or will be effective.



The systems and resources necessary to comply with
public company reporting requirements will increase further once we cease to be a “non-accelerated filer” under Rule 12b-2
of the Exchange Act or an “emerging growth company” under the Jumpstart Our Business Startups Act, as amended, or the JOBS
Act. As long as we remain a non-accelerated filer or an emerging growth company, we intend to take advantage of certain exemptions from
various reporting requirements that are applicable to other public companies, including not being required to comply with the auditor
attestation requirements of Section 404 of the Sarbanes-Oxley Act. We will remain a non-accelerated filer until we have a public
float, as such term is used in Rule 12b-2 of the Exchange Act, of $75 million or more. We will remain an emerging growth company
for up to five years following an IPO, although if our public float exceeds $700 million as of any June 30 before that time, we would
cease to be an emerging growth company as of the following December 31.





50







We are obligated to maintain proper and effective internal controls
over financial reporting in accordance with Section 404 of the Sarbanes-Oxley Act, and failure to achieve and maintain effective
internal controls over financial reporting in accordance with Section 404 of the Sarbanes-Oxley Act could have a material adverse
effect on our business and the value of the Shares.



We are obligated to maintain proper and effective
internal controls over financial reporting, including the internal control evaluation and certification requirements of Section 404
of the Sarbanes-Oxley Act and related rules and regulations of the SEC. However, we will not be required to comply with all of the
requirements under Section 404 of the Sarbanes-Oxley Act until the later of the date we are no longer a non-accelerated filer or
the date we are no longer an emerging growth company under the JOBS Act. Accordingly, our internal controls over financial reporting may
not currently meet all of the standards contemplated by Section 404 of the Sarbanes-Oxley Act that we will eventually be required
to meet. Specifically, we are required to conduct annual management assessments of the effectiveness of our internal controls over financial
reporting, however our independent registered public accounting firm will not be required to formally attest to the effectiveness of our
internal control over financial reporting until the later of the date we are no longer a non-accelerated filer or the date we are no longer
an emerging growth company under the JOBS Act.



If we are not able to comply with the requirements
of Section 404 of the Sarbanes-Oxley Act or maintain adequate compliance, our operations, financial reporting or financial results
could be adversely affected. Matters impacting our internal controls may cause us to be unable to report our financial information on
a timely basis and thereby subject us to adverse regulatory consequences, including sanctions by the SEC or violations of applicable stock
exchange listing rules, and result in a breach of the covenants under the agreements governing any of our financing arrangements. There
could also be a negative reaction in the financial markets due to a loss of investor confidence in us and the reliability of our financial
statements. Confidence in the reliability of our financial statements could also suffer if we or our independent registered public accounting
firm were to report a material weakness in our internal controls over financial reporting. This could materially adversely affect us and
lead to a decline in the market price of the Shares, to the extent we have completed an IPO.



Our Board of Directors may change our investment objective, operating
policies and strategies without prior notice or stockholder approval.



Our Board of Directors has the authority to change
our investment objective and modify or waive certain of our operating policies and strategies without prior notice (except as required
by the 1940 Act) and without stockholder approval. However, absent stockholder approval, we may not change the nature of our business
so as to cease to be a BDC and we may not withdraw our election as a BDC. We cannot predict the effect any changes to our current operating
policies or strategies would have on our business, operating results and value of our Common Stock. Nevertheless, the effects may adversely
affect our business and impact our ability to make distributions.



A stockholder’s interest in us could be diluted if we issue
additional Shares, which could reduce the overall value of an investment in us.



Our Board of Directors may, in its sole discretion,
conduct one or more additional private offerings of the Shares. Investors do not have preemptive rights to any Shares we issue in the
future. Any such additional offering may have a dilutive effect on existing stockholders. To the extent we issue additional Shares at
or below net asset value, after an investor purchases the Shares, an investor’s percentage ownership interest in us will be diluted.
If we were to sell the Shares below the then current net asset value per Share in any such additional offering, there would be an immediate
dilution to our net asset value per Share. In addition, depending upon the terms and pricing of any additional offerings and the value
of our investments, an investor may also experience dilution in the net asset and fair value of his, her or its Shares.



As a BDC, we generally are prohibited from issuing
or selling the Shares at a price below net asset value per Share, which may be a disadvantage as compared with certain public companies.
In any such case, the price at which our securities are to be issued and sold may not be less than a price that, in the determination
of the Board of Directors, closely approximates the fair value of such securities (less any distributing commission or discount). If we
raise additional funds by issuing Common Stock, or senior securities convertible into or exchangeable for our Common Stock, then the percentage
ownership of our stockholders at that time will decrease, and you will experience dilution. We may sell the Shares, or warrants, options,
or rights to acquire such Shares at a price below the then current net asset value of such Shares if (1) our Board of Directors and
independent directors determine that such sale is in our best interests and the best interests of our stockholders, and (2) our stockholders,
including a majority of those stockholders who are not affiliated with us, approve such sale.





51







Provisions of the General Corporation Law of the State of Delaware
and our certificate of incorporation and bylaws could deter takeover attempts and have an adverse effect on the price of our Common Stock.



The General Corporation Law of the State of Delaware,
or the DGCL, our certificate of incorporation, and bylaws contain provisions that may discourage, delay or make more difficult a change
in control of us or the removal of our directors. These measures may delay, defer or prevent a transaction or a change in control that
might otherwise be in the best interests of our stockholders and could have the effect of depriving stockholders of an opportunity to
sell their shares at a premium over prevailing market prices.



Our Adviser is able to resign upon 60 days’ notice, and
we may not be able to find a suitable replacement within that time, resulting in a disruption in our operations that could adversely affect
our financial condition, business and results of operations.



Our Adviser has the right, under the Investment
Advisory Agreement, to resign at any time upon 60 days written notice, whether we have found a replacement or not. If our Adviser resigns,
we may not be able to find a new investment adviser or hire internal management with similar expertise and ability to provide the same
or equivalent services on acceptable terms within 60 days, or at all. If we are unable to do so quickly, our operations are likely to
experience a disruption, our financial condition, business and results of operations as well as our ability to pay distributions are likely
to be adversely affected and the value of our Common Stock may decline. In addition, the coordination of our internal management and investment
activities is likely to suffer if we are unable to identify and reach an agreement with a single institution or group of executives having
the expertise possessed by our Adviser and its affiliates. Even if we are able to retain comparable management, whether internal or external,
the integration of such management and their lack of familiarity with our investment objective may result in additional costs and time
delays that may adversely affect our financial condition, business and results of operations.



Our Administrator is able to resign from its role as Administrator
under the Administration Agreement, and a suitable replacement may not be found, resulting in disruptions that could adversely affect
our business, results of operations and financial condition.



Our Administrator has the right to resign under
the Administration Agreement upon 60 days’ written notice, whether a replacement has been found or not. If our Administrator resigns,
it may be difficult to find a new administrator or hire internal management with similar expertise and ability to provide the same or
equivalent services on acceptable terms, or at all. If a replacement is not found quickly, our business, results of operations and financial
condition are likely to be adversely affected and the value of our Common Stock may decline. Even if a comparable service provider or
individuals to perform such services are retained, whether internal or external, their integration into our business and lack of familiarity
with our investment objective may result in additional costs and time delays that may materially adversely affect our business, results
of operations and financial condition.



The net asset value of the Shares may fluctuate significantly.



The net asset value and liquidity, if any, of the
market for the Shares may be significantly affected by numerous factors, some of which are beyond our control and may not be directly
related to our operating performance. These factors include:



| | · | changes in earnings or variations in operating results;                                            
| | - | ---------------------------------------------------------------------------------------------------
| | · | changes in the value of our portfolio of investments;                                              
| | · | changes in accounting guidelines governing valuation of our investments;                           
| | · | changes in regulatory policies or tax guidelines, particularly with respect to RICs and/or BDCs;   
| | · | loss of RIC and/or BDC status;                                                                     
| | · | any shortfall in revenue or net income or any increase in losses from levels expected by investors;





52







| | · | departure of either of our Adviser or certain of its key personnel;                                                                           
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------
| | · | general economic trends and other external factors;                                                                                           
| | · | the potential loss of a major funding source; and                                                                                             
| | · | the length and duration of the COVID-19 pandemic in the United States and worldwide and the magnitude of the economic impact of such pandemic.





Legislation passed in 2018 allows us to incur additional leverage
and would require us to offer liquidity to our stockholders.



Under the 1940 Act, a BDC generally is required
to maintain asset coverage of 200% for senior securities representing indebtedness (such as borrowings from banks or other financial institutions)
or stock (such as preferred stock). The Small Business Credit Availability Act, which was signed into law on March 23, 2018, provides
that a BDC’s required asset coverage under the 1940 Act may be reduced from 200% (i.e., $1 of debt outstanding for each $1 of equity)
to 150% (i.e., $2 of debt outstanding for each $1 of equity). This reduction in asset coverage permits a BDC to double the amount of leverage
it may utilize, subject to certain approval, timing and reporting requirements, including either stockholder approval or approval of a
majority of the directors who are not “interested persons” (as defined in the 1940 Act) of the BDC and who have no financial
interest in the arrangement. As a result, if we receive the relevant approval and we comply with the applicable disclosure requirements,
we would be able to incur additional leverage, which may increase the risk of investing in us. In addition, since our base management
fee is payable based upon our average adjusted gross assets, which includes any borrowings for investment purposes, our base management
fee expenses may increase if we incur additional leverage.



General Risk Factors



Global capital markets could enter a period of severe disruption
and instability due to future recessions, political instability, geopolitical turmoil and foreign hostilities, disease pandemics and other
serious health events. These market disruptions have historically had and could again have a materially adverse effect on debt and equity
capital markets in the United States, which could have a materially adverse impact on our business and financial condition.



The U.S. capital markets have experienced extreme
volatility and disruption following the global outbreak of COVID-19. The recent Russia/Ukraine conflict and resulting economic sanctions
may also have significant effects on global markets and may exacerbate existing supply chain issues. Disruptions in the capital markets
have increased the spread between the yields realized on risk-free and higher risk securities, resulting in illiquidity in parts of the
capital markets and valuation impacts. Such disruptions are adversely affecting our business, and future market disruptions and/or illiquidity
could continue to impact us negatively. These events have limited, and could continue to limit, our investment opportunities, may limit
our ability to grow and could negatively impact our operating results and the fair values of our investments.



Changes to U.S. tariff and import/export regulations may affect
our portfolio companies, and may negatively impact our business, results of operations or financial conditions.



There has been ongoing discussion and commentary
regarding potential significant changes to U.S. trade policies, treaties and tariffs, creating uncertainty about the future relationship
between the United States and other countries. These developments, or the perception that any of them could occur, may have a material
adverse effect on global economic conditions and the stability of global financial markets, and may significantly reduce global trade.
Any of these factors could dampen economic activity and limit our portfolio companies’ access to suppliers or customers, resulting
in a material adverse effect on their business, financial condition and results of operations, which in turn would negatively impact us.



We may experience fluctuations in our quarterly results.



We could experience fluctuations in our quarterly
operating results due to a number of factors, including our ability or inability to make investments in companies that meet our investment
criteria, the interest rate payable and default rates on the debt securities we acquire, inflation, energy shortages, the level of our
expenses, variations in and timing of the recognition of realized and unrealized gains or losses, the degree to which we encounter competition
in our markets, and general economic conditions. As a result of these factors, results for any previous period should not be relied upon
as indicative of performance in future periods. These occurrences could have a material adverse effect on our results of operations, the
value of your investment and our ability to pay distributions.





53







We are subject to risks related to corporate social responsibility.



There is increased public scrutiny related to environmental,
social and governance (“ESG”) activities of public companies. We risk damage to our brand and reputation if we do not act
responsibly in a number of key areas, including diversity and inclusion, environmental stewardship, support for local communities, corporate
governance and transparency and considering ESG factors in our investment processes. Adverse incidents with respect to ESG activities
could impact the value of our brand, the cost of our operations and relationships with investors, all of which could negatively affect
our business and results of operations. Additionally, new regulatory initiatives related to ESG could adversely affect our business.



Changes in laws or regulations governing our operations may adversely
affect our business or cause us to alter our business strategy.



We and our portfolio companies are subject to regulation
at the local, state and federal level. New legislation may be enacted or new interpretations, rulings or regulations could be adopted,
including those governing the types of investments we are permitted to make or that impose limits on our ability to pledge a significant
amount of our assets to secure loans or that restrict the operations of a portfolio company, any of which could harm us and our stockholders
and the value of our investments, potentially with retroactive effect. For example, certain provisions of the Dodd-Frank Wall Street Reform
and Consumer Protection Act, which influences many aspects of the financial services industry, have been amended or repealed, and the
Code has been substantially amended and reformed. Any amendment or repeal of legislation, or changes in regulations or regulatory interpretations
thereof, could create uncertainty in the near term, which could have a material adverse impact on our business, financial condition and
results of operations.



In addition, any changes to the laws and regulations
governing our operations relating to permitted investments may cause us to change our investment strategy in order to avail ourselves
to new or different opportunities. Such changes could differ materially from the strategies and plans set forth in this annual report
and may shift our investment focus from the areas of expertise of our Adviser. For example, the Biden administration has announced its
intention to enact substantive regulations that, if adopted, will affect substantial aspects of our business. Thus, any such changes,
if they occur, could have a material adverse effect on our results of operations and the value of your investment.



Stockholders may be subject to filing requirements under the
Exchange Act as a result of an investment in us.



Because the Shares are registered under the Exchange
Act, ownership information for any person who beneficially owns 5% or more of the Shares has to be disclosed in a Schedule 13D or other
filings with the SEC. Beneficial ownership for these purposes is determined in accordance with the rules of the SEC, and includes
having voting or investment power over the securities. In some circumstances, investors who choose to reinvest their dividends may see
their percentage stake in us increased to more than 5%, thus triggering this filing requirement. Although we provide in our quarterly
statements the amount of outstanding Shares and the amount of the investor’s Shares, the responsibility for determining the filing
obligation and preparing the filing remains with the investor. In addition, owners of 10% or more of the Shares are subject to reporting
obligations under Section 16(a) of the Exchange Act.



Stockholders may be subject to the short-swing profits rules under
the Exchange Act as a result of an investment in us.



Persons with the right to appoint a director or
who hold more than 10% of a class of the Shares may be subject to Section 16(b) of the Exchange Act, which recaptures for the
benefit of the issuer profits from the purchase and sale of registered stock within a six-month period.





54







We, our Adviser or its affiliates may be subject to litigation
or regulatory proceedings the results of which could have a material adverse effect on our financial condition or results of operations.



From time to time we, our Adviser or its affiliates
may be involved in various legal proceedings, lawsuits and claims incidental to the conduct of their respective businesses. We, our Adviser
and its affiliates are also subject to extensive regulation, which may result in regulatory proceedings. In addition, our executive management
team, directors and members of our Adviser’s management may, in the ordinary course of business, be named as defendants in litigation
arising from our investments in such portfolio companies. To the extent we, our executive management team or directors, or members of
our Adviser’s management team face adverse outcomes in any such proceedings, our financial condition or results of operations could
be materially adversely affected.



ITEM 1B. UNRESOLVED STAFF COMMENTS



None.



ITEM 2. PROPERTIES



Our headquarters are located at 101 Huntington
Avenue, Boston, Massachusetts 02199, and are provided by our Administrator. We reimburse our Administrator for such costs on an allocated
basis, in accordance with the terms of our Administration Agreement. We believe that our office facilities are suitable and adequate for
our business.



ITEM 3. LEGAL PROCEEDINGS



Neither we nor our Adviser or Administrator is
currently subject to any material legal proceedings, nor, to our knowledge, is any material legal proceeding threatened against us, or
against our Adviser or Administrator.



From time to time, we, our Adviser or Administrator
may be a party to certain legal proceedings in the ordinary course of business, including proceedings relating to 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 financial condition or results of operations.



From time to time we are involved in various legal
proceedings, lawsuits and claims incidental to the conduct of our business. Our businesses are also subject to extensive regulation, which
may result in regulatory proceedings against us.



ITEM 4. MINE SAFETY DISCLOSURES



Not applicable.





55







PART II



ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER
MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES



Until the completion of an IPO, our outstanding
Common Stock will be offered and sold in transactions exempt from registration under the Securities Act under Section 4(a)(2) and
Regulation D. See “— Recent Sales of Unregistered Securities and Purchases of Equity Securities” below for more information.
There is currently no public market for our Common Stock, nor can we give any assurance that one will develop.



Because our Common Stock is acquired by investors
in one or more transactions “not involving a public offering,” they are “restricted securities” and may be required
to be held indefinitely. Our Common Stock may not be sold, transferred, assigned, pledged or otherwise disposed of unless (i) our
consent is granted, and (ii) the Common Stock is registered under applicable securities laws or specifically exempted from registration
(in which case the stockholder may, at our option, be required to provide us with a legal opinion, in form and substance satisfactory
to us, that registration is not required). Accordingly, an investor must be willing to bear the economic risk of investment in the Common
Stock until we are liquidated. No sale, transfer, assignment, pledge or other disposition, whether voluntary or involuntary, of the Common
Stock may be made except by registration of the transfer on our books. Each transferee will be required to execute an instrument agreeing
to be bound by these restrictions and the other restrictions imposed on the Common Stock and to execute such other instruments or certifications
as are reasonably required by us.



Holders



As of March 20, 2023, we had two stockholders
of record.



Distributions



We
have elected to be treated as a RIC under Subchapter M of the Code.To
qualify and maintain our qualification as a RIC, we must meet certain source-of-income and asset diversification requirements as well
as distribute dividends to our stockholders each taxable year of an amount at least equal to 90% of our investment company taxable income.
For more information, see “Item 7 — Management’s Discussion and Analysis of Financial Condition and Results of Operation
 — Distributions to Stockholders — Common Stock Distributions.”



The distributions declared during the year ended
December 31, 2022, were derived from $0.53 of net investment income and $0.01 return of capital. The distributions declared during
the year ended December 31, 2021, were derived from $0.39 of net investment income and $0.01 return of capital.



We have notified shareholders of amounts for use
in preparing 2022 income tax forms in January 2022. The following information is provided pursuant to provisions of the Code. The
Company designates $0 as capital gain dividends paid during the fiscal year ended December 31, 2022.



Recent Sales of Unregistered Securities and Purchases of Equity
Securities



We have been party to subscription agreements,
pursuant to which an investor is required to fund drawdowns to purchase Shares up to the amount of the investor’s capital commitment
on an as-needed basis with a minimum of 10 calendar days’ prior notice.



The following table summarizes the sales of the
Shares pursuant to a subscription agreement during the year ended December 31, 2022:



|Date of Sale     |  |  | Shares Sold |           |  | Aggregate Offering Price |  
|---------------- |  |  | ----------- | --------- |  | ------------------------ | -
|January 12, 2022 |  |  |             | 3,205,128 |  |                          | $
|April 5, 2022    |  |  |             | 2,651,113 |  |                          |  
|July 8, 2022     |  |  |             | 3,236,256 |  |                          |  
|October 7, 2022  |  |  |             | 2,653,928 |  |                          |  





56







The following table summarizes the sales of the Shares pursuant
to a subscription agreement during the year ended December 31, 2021:



|Date of Sale    |  |  | Shares Sold |         |  | Aggregate Offering Price |  
|--------------- |  |  | ----------- | ------- |  | ------------------------ | -
|January 8, 2021 |  |  |             | 665,951 |  |                          | $
|July 6, 2021    |  |  |             | 951,872 |  |                          |  



The sales of our Common Stock pursuant to the subscription
agreements were exempt from the registration requirements of the Securities Act pursuant to Section 4(a)(2) thereof. We did
not engage in general solicitation or advertising with regard to such sales of our Common Stock and did not offer securities to the public
in connection with such issuance and sale. The investors who purchased Common Stock were all accredited investors.



ITEM 6. SELECTED FINANCIAL DATA



The following selected financial data for the years
ended December 31, 2022, 2021 and 2020 were derived from our accompanying audited financial statements and notes to the financial
statements, included elsewhere in this annual report. The data should be read in conjunction with our accompanying financial statements,
notes to the financial statements and “Management’s Discussion and Analysis of Financial Condition and Results of Operations”
included elsewhere in this annual report.



|                                                                                             |  | Year Ended 
December 31, 2022 |             |   | Year Ended 
December 31, 2021 |   |             | Year Ended 
December 31, 2020 | 
|-------------------------------------------------------------------------------------------- |  | ----------------------------- | ----------- | - | ----------------------------- | - | ----------- | ----------------------------- | 
|Statement of Operations Data:                                                                |  |                               |             |   |                               |   |             |                               | 
|Income                                                                                       |  |                               |             |   |                               |   |             |                               | 
|Total investment income                                                                      |  | $                             | 29,658,516  |   |                               | $ | 19,464,680  |                               | 
|Expenses                                                                                     |  |                               |             |   |                               |   |             |                               | 
|Net expense                                                                                  |  |                               | 5,840,708   |   |                               |   | 3,902,558   |                               | 
|Net investment income                                                                        |  |                               | 23,817,808  |   |                               |   | 15,562,122  |                               | 
|Net realized gain (loss) on investments                                                      |  |                               | 853,764     |   |                               |   | (196,218    | )                             | 
|Net change in unrealized (depreciation) appreciation on investments                          |  |                               | (5,633,954  | ) |                               |   | 2,392,705   |                               | 
|Net increase in net assets resulting from operations                                         |  | $                             | 19,037,618  |   |                               | $ | 17,758,609  |                               | 
|                                                                                             |  |                               |             |   |                               |   |             |                               | 
|Per Share Data:                                                                              |  |                               |             |   |                               |   |             |                               | 
|Net investment income per common share - basic and diluted (a)                               |  | $                             | 0.53        |   |                               | $ | 0.39        |                               | 
|Net increase in net assets resulting from operations percommon share - basic and diluted (a) |  |                               | 0.42        |   |                               |   | 0.45        |                               | 
|Distributions declared per common share                                                      |  |                               | 0.53        |   |                               |   | 0.39        |                               | 
|                                                                                             |  |                               |             |   |                               |   |             |                               | 
|Statement of Assets and Liabilities Data:                                                    |  |                               |             |   |                               |   |             |                               | 
|Total assets                                                                                 |  | $                             | 443,650,195 |   |                               | $ | 415,183,495 |                               | 
|Total liabilities                                                                            |  |                               | 15,172,517  |   |                               |   | 41,236,161  |                               | 
|Net assets                                                                                   |  |                               | 428,477,678 |   |                               |   | 373,947,334 |                               | 
|Net asset value per common share                                                             |  |                               | 9.24        |   |                               |   | 9.36        |                               | 
|Common shares outstanding                                                                    |  |                               | 46,376,461  |   |                               |   | 39,961,408  |                               | 
|Weighted common shares outstanding - basic and diluted                                       |  |                               | 45,106,946  |   |                               |   | 39,463,569  |                               | 
|                                                                                             |  |                               |             |   |                               |   |             |                               | 
|Other Data:                                                                                  |  |                               |             |   |                               |   |             |                               | 
|Number of portfolio investments                                                              |  |                               | 252         |   |                               |   | 251         |                               | 
|Average investment amount (b)                                                                |  | $                             | 1,697,226   |   |                               | $ | 1,610,728   |                               | 
|Percentage of investments at floating rates (b)                                              |  |                               | 99.41       | % |                               |   | 100.00      | %                             | 



|(a) Per
    share data is based on weighted average common stock outstanding for both basic and diluted.
|--------------------------------------------------------------------------------------------------------
|(b) Based on cost of
    investments.                                                                   





57







ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS



The information contained in this section should be read in conjunction
with the financial statements and notes to the financial statements appearing elsewhere in this annual report.



This
annual report and other statements contain forward-looking statements that involve substantial risks and uncertainties. Such statements
involve known and unknown risks, uncertainties and other factors and undue reliance should not be placed thereon. These forward-looking
statements are not historical facts, but rather are based on current expectations, estimates and projections about our company, our current
and prospective portfolio investments, our industry, our beliefs and our assumptions. Words such as “anticipates,” “expects,”
 “intends,” “plans,” “will,” “may,” “continue,” “believes,” “seeks,”
 “estimates,” “would,” “could,” “should,” “targets,” “projects,”
and variations of these words and similar expressions are intended to identify forward-looking statements. These statements are not guarantees
of future performance and are subject to risks, uncertainties and other factors, some of which are beyond our control and difficult to
predict and could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements, including:



| | · | our future operating results;                                                                                                                                                                           
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | · | our business prospects and the prospects of our portfolio companies;                                                                                                                                    
| | · | changes in political, economic or industry conditions, rising interest rates and conditions affecting the financial and capital markets, which could result in changes to the value of our assets;      
| | · | changes in the general economy, slowing economy, rising inflation and risk of recession;                                                                                                                
| | · | supply chain disruptions in connection with shutdowns in China and elsewhere and similar factors related to COVID-19;                                                                                   
| | · | uncertainty surrounding financial and political stability of the United States, the United Kingdom, the European Union, and China, and the war between Russia and Ukraine;                              
| | · | the ability of our portfolio companies to achieve their objectives;                                                                                                                                     
| | · | the timing of cash flows, if any, from the operations of our portfolio companies;                                                                                                                       
| | · | the ability of our Adviser to locate suitable investments for us and to monitor and administer our investments;                                                                                         
| | · | risk associated with possible disruptions in our operations or the economy generally;                                                                                                                   
| | · | the effect of investments that we expect to make;                                                                                                                                                       
| | · | our contractual arrangements and relationships with third parties;                                                                                                                                      
| | · | actual and potential conflicts of interest with Adviser and its affiliates;                                                                                                                             
| | · | the dependence of our future success on the general economy and its effect on the industries in which we invest;                                                                                        
| | · | our ability to continue to effectively manage our business due to COVID-19 and similar pandemics;                                                                                                       
| | · | the adequacy of our financing sources and working capital;                                                                                                                                              
| | · | the ability of our Adviser and its affiliates to attract and retain highly talented professionals;                                                                                                      
| | · | our ability to qualify and maintain our qualification as a BDC and as a RIC; and                                                                                                                        
| | · | the risks, uncertainties and other factors we identify under “Item 1A. Risk Factors” and elsewhere in our Annual Report on Form 10-K filed on March 20, 2023 (file no. 814-01154) (the “Annual Report”).



Although
we believe that the assumptions on which these forward-looking statements are based are reasonable, any of those assumptions could prove
to be inaccurate, and as a result, the forward-looking statements based on those assumptions also could be inaccurate. In light of these
and other uncertainties, the inclusion of a projection or forward-looking statement in this annual report should not be regarded as a
representation by us that our plans and objectives will be achieved. These risks and uncertainties include those described or identified
in the section of our Registration Statement and this Form 10-K entitled “Item 1A. Risk Factors”, elsewhere in this annual
report on Form 10-K and in other filings we may make with the SEC from time to time. You should not place undue reliance on
these forward-looking statements, which apply only as of the date of this annual report. Moreover, we assume no duty and do not undertake
to update the forward-looking statements.





58







OVERVIEW



Audax Credit BDC Inc. is a Delaware corporation
that was formed on January 29, 2015. We are an externally managed, closed-end, non-diversified management investment company that
has elected to be treated as a BDC under the 1940 Act. In addition, we have elected to be treated for U.S. federal income tax purposes
and intend to comply with the requirements to qualify annually, as a RIC under Subchapter M of the Code.



Our investment objective is to generate current
income and, to a lesser extent, long-term capital appreciation. We intend to meet our investment objective by investing primarily in senior
secured debt of privately owned U.S. middle market companies. We intend to invest at least 80% of our net assets plus the amount of any
borrowings in “credit instruments,” which we define as any fixed income instruments. We may also invest, at any time and from
time to time, in syndicated loans, securities, structured products and other financial instruments, including, without limitation, corporate
and government bonds, convertible securities, term loans, equity securities (both common and preferred), various debt securities (both
secured and unsecured), dividend-paying equity, royalties, collateralized loan obligations, and warrants.



Although we have no present intention of doing
so, we may decide to incur leverage. If we do incur leverage, however, we anticipate that it will be used in limited circumstances and
on a short-term basis for purposes such as funding distributions. As a BDC, we are limited in our use of leverage under the 1940 Act.
Under the 1940 Act, a BDC generally is required to maintain asset coverage of 200% for senior securities representing indebtedness (such
as borrowings from banks or other financial institutions) or stock (such as preferred stock). The Small Business Credit Availability Act
(the “SBCAA”), which was signed into law on March 23, 2018, provides that a BDC's required asset coverage under the 1940
Act may be reduced from 200% (i.e., $1 of debt outstanding for each $1 of equity) to 150% (i.e., $2 of debt outstanding for each $1 of
equity). This reduction in asset coverage permits a BDC to double the amount of leverage it may utilize, subject to certain approval,
timing and reporting requirements, including either stockholder approval or approval of a majority of the directors who are not “interested
persons” (as defined in the 1940 Act) of the BDC and who have no financial interest in the arrangement. In addition, as a non-traded
BDC, if we receive the relevant approval to increase our authorized leverage, we will be required to offer our stockholders the opportunity
to sell their shares of Common Stock over the next year following the calendar quarter in which the approval was obtained. In determining
whether to use leverage, we will analyze the maturity, covenants and interest rate structure of the proposed borrowings, as well as the
risks of such borrowings within the context of our investment outlook and the impact of leverage on our investment portfolio. The amount
of any leverage that we will employ as a BDC will be subject to oversight by our Board of Directors.



We generate revenue in the form of interest on
the debt securities that we hold in our portfolio companies. The senior debt we invest in generally has stated terms of three to ten years.
Our senior debt investments generally bear interest at a floating rate. Interest on debt securities is generally payable quarterly or
semiannually. In some cases, some of our investments may provide for deferred interest payments or PIK interest. The principal amount
of the debt securities and any accrued but unpaid interest generally will become due at the maturity date. In addition, we may generate
revenue in the form of commitment and other fees in connection with transactions, although we do not expect to do so. OID as well as market
discount and premium are accreted and amortized in determining our interest income. We record any prepayment premiums on loans and debt
securities as income.



PORTFOLIO COMPOSITION AND INVESTMENT ACTIVITY



Portfolio Composition



The fair value of our investments, comprised of syndicated loans and
equity, as of December 31, 2022, was approximately $420,828,658, and we held investments in 222 portfolio companies as of December 31,
2022. The fair value of our investments, comprised of syndicated loans and equity, as of December 31, 2021, was approximately $403,054,374,
and we held investments in 215 portfolio companies as of December 31, 2021.





59







During the year ended December 31, 2022, we
purchased $112,962,731 in investments, and we had $69,513,201 in debt repayments by existing portfolio companies, and $21,825,900 in sales
of securities of portfolio companies. During the year ended December 31, 2021, we purchased $159,699,549 in investments, and we had
$99,779,754 in debt repayments by existing portfolio companies, and $15,117,554 in sales of securities of portfolio companies. In addition,
for the year ended December 31, 2022, we had a change in unrealized depreciation of $5,633,954 and realized gains of $853,764, and
for the year ended December 31, 2021, we had a change in unrealized appreciation of $2,392,705 and realized losses of $196,218.



Our investment activity for the years ended December 31,
2022 and 2021, is presented at fair value below:



|                                                                    |  | Year Ended

December 31, 2022 |             |   | Year Ended

December 31, 2021 |  
|------------------------------------------------------------------- |  | ----------------------------- | ----------- | - | ----------------------------- | -
|Beginning investment portfolio, at fair value                       |  | $                             | 403,054,374 |   |                               | $
|Investments in new portfolio investments                            |  |                               | 103,470,665 |   |                               |  
|Investments in existing portfolio investments                       |  |                               | 9,492,066   |   |                               |  
|Principal repayments                                                |  |                               | (69,513,201 | ) |                               |  
|Proceeds from investments sold                                      |  |                               | (21,825,900 | ) |                               |  
|Change in premiums, discounts and amortization                      |  |                               | 930,844     |   |                               |  
|Net change in unrealized (depreciation) appreciation on investments |  |                               | (5,633,954  | ) |                               |  
|Realized gain (loss) on investments                                 |  |                               | 853,764     |   |                               |  
|Ending portfolio investment activity, at fair value                 |  | $                             | 420,828,658 |   |                               | $
|Number of portfolio investments                                     |  |                               | 252         |   |                               |  
|Average investment amount, at cost                                  |  | $                             | 1,697,226   |   |                               | $
|Percentage of  investments at floating rates                        |  |                               | 99.41       | % |                               |  



As of December 31, 2022 and 2021, all of our
portfolio consisted of non-controlled/non-affiliated investments.



RECENT DEVELOPMENTS



Subsequent to December 31, 2022 through March 20,
2023, we invested $4,512,369 at cost in 27 different portfolio companies.



On January 9, 2023, the Company issued a Tender
Offer to repurchase $15.0 million worth of Common Stock. The Offer was accepted on February 7, 2023.



On March 8, 2023, Company adopted Rule 2a-5
under the 1940 Act, which establishes an updated regulatory framework for determining fair value in good faith for purposes of the 1940
Act. The adopted rule clarifies how fund boards can satisfy their valuation obligations in light of recent market developments. The
rule permits boards, subject to board oversight and certain other conditions, to designate certain parties to perform the fair value
determinations.



The sale of Common Stock was made pursuant to a
subscription agreement entered into by the Company and the investor. Under the terms of the subscription agreement, the investor is required
to fund drawdowns to purchase shares of Common Stock up to the amount of its capital commitment on an as-needed basis with a minimum of
10 calendar days’ prior notice.



The issuance of the Common Stock is exempt from
the registration requirements of the Securities Act pursuant to Section 4(a)(2) thereof. The Company has not engaged in general
solicitation or advertising with regard to the issuance and sale of the Common Stock and has not offered securities to the public in connection
with such issuance and sale.





60







RESULTS OF OPERATIONS



Set forth below is a comparison of our results
of operations for the years ended December 31, 2022 and 2021. For a comparison of our results of operations for the years ended December 31,
2021 and 2020, see the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2021, as filed with the SEC
on March 25, 2022.



The net increase or decrease in net assets from
operations may vary substantially from period to period as a result of various factors, including the recognition of realized gains and/or
losses and net change in unrealized appreciation and depreciation.



Revenue



Net investment income for the years ended December 31,
2022 and 2021, is presented in the table below:



|                                                                     |  | Year Ended 
December 31, 2022 |            |  | Year Ended 
December 31, 2021 |  
|-------------------------------------------------------------------- |  | ----------------------------- | ---------- |  | ----------------------------- | -
|Total interest income from non-controlled/non-affiliated investments |  | $                             | 29,155,188 |  |                               | $
|Total other interest income                                          |  |                               | 44,174     |  |                               |  
|Total other income                                                   |  |                               | 459,154    |  |                               |  
|Total investment income                                              |  | $                             | 29,658,516 |  |                               | $



Total investment income for the year ended December 31,
2022 increased to $29,658,516 from $19,464,680 for the year ended December 31, 2021, and was primarily driven by an increase in interest
rate spreads over the period and our increasing investment balance. As of December 31, 2022 and 2021, the size of our debt portfolio
was $424,399,110 and $403,106,122 at amortized cost, respectively, with total principal amount of debt outstanding of $428,909,124 and
$406,135,083, respectively.



Expenses



Total expenses net of waivers for the years ended
December 31, 2022 and 2021, were as follows:



|                               |  | Year Ended
 December 31, 2022 |            |   | Year Ended
 December 31, 2021 |  
|------------------------------ |  | ----------------------------- | ---------- | - | ----------------------------- | -
|Base management fee(a)         |  | $                             | 4,422,989  |   |                               | $
|Incentive fee(a)               |  |                               | 3,454,468  |   |                               |  
|Interest expense(b)            |  |                               | 712,005    |   |                               |  
|Professional fees              |  |                               | 643,991    |   |                               |  
|Other expenses                 |  |                               | 308,184    |   |                               |  
|Administrative fee(a)          |  |                               | 265,000    |   |                               |  
|Directors' fees                |  |                               | 240,000    |   |                               |  
|Total expenses                 |  |                               | 10,046,637 |   |                               |  
|Base management fee waivers(a) |  |                               | (1,548,046 | ) |                               |  
|Incentive fee waivers(a)       |  |                               | (2,657,883 | ) |                               |  
|Total expenses, net of waivers |  | $                             | 5,840,708  |   |                               | $



| | (a) Refer
    to Note 4-Related Party Transactionswithin the financial statements for a description of the relevant fees.
| | -------------------------------------------------------------------------------------------------------------------------
| | (b) Refer
    to Note 8-Borrowingwithin the financial statements for a description of the relevant expenses.             





61







The
increase in base management fees before waivers for the year ended December 31, 2022 in comparison to the year ended December 31,
2021 was driven by our increasing invested balance. For the years ended December 31, 2022 and 2021, we accrued gross base management
fees before waivers of $4,422,989 and $3,764,399, respectively. Offsetting those fees, we recognized base management fee waivers of $1,548,046
and $1,317,540, respectively. For the years ended December 31, 2022 and 2021, we accrued incentive fees related to net investment
income before waivers of $3,454,468 and $848,440, respectively. Offsetting those fees during the periods were incentive fee waivers of
$2,657,883 and $763,596, respectively. For the years ended December 31, 2022 and 2021, we did not accrue incentive fees related to
capital gains. Additionally, we accrued $265,000 of administrative fees for each of the years ended December 31, 2022 and 2021. Refer
to Note 4— Related Party Transactionsin the notes accompanying our financial statements for more information related
to base management fees, incentive fees and waivers.



During the years ended December 31, 2022 and
2021, we incurred professional fees of $643,991 and $488,934, respectively, related to audit fees, tax fees, and legal fees. The increase
in professional fess was driven by an increase in legal fees during the year ended December 31, 2022. We also incurred expenses related
to fees paid to our independent directors of $240,000 and $225,000 for the years ended December 31, 2022 and 2021, respectively.
During the years ended December 31, 2022 and 2021, we incurred other expenses of $308,184 and $391,921, respectively, related to
subscription fees, operating fees, custody fees, and other company expenses. The decrease in other expenses was driven by a decrease in
the Delaware State Franchise Tax applicable to the Company during the year ended December 31, 2022.



During
the year ended December 31, 2022, we incurred interest expense of $712,005 in connection with our short-term borrowings. Refer to
Note 8— Borrowingsin the notes accompanying our financial statements for more information related to interest expense.



Realized and Unrealized Gains and Losses



We recognized $853,764 in net realized gains for
the year ended December 31, 2022. We recognized $196,218 in net realized losses for the year ended December 31, 2021.



Net change in unrealized (depreciation) appreciation
on investments for the years ended December 31, 2022, and 2021, is presented in the table below, was as follows:



|Type                                                                |  | Year Ended
 December 31, 2022 |            |   | Year Ended
 December 31, 2021 |  
|------------------------------------------------------------------- |  | ----------------------------- | ---------- | - | ----------------------------- | -
|First Lien Debt                                                     |  | $                             | (5,157,049 | ) |                               | $
|Unitranche Debt                                                     |  |                               | (595,207   | ) |                               |  
|Second Lien Debt                                                    |  |                               | (74,090    | ) |                               |  
|Equity and Preferred Shares                                         |  |                               | 192,392    |   |                               |  
|Net change in unrealized (depreciation) appreciation on investments |  | $                             | (5,633,954 | ) |                               | $



FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES



Set forth below are our financial condition, liquidity
and capital resources for the years ended December 31, 2022 and 2021. For information regarding our liquidity and capital resources
for the year ended December 31, 2021, see the Company's Annual Report on Form 10-K for the fiscal year ended December 31,
2021, as filed with the SEC on March 25, 2022.



We generate cash primarily from the net proceeds
of any offering of the Shares, from cash flows from interest and fees earned from our investments, and from principal repayments and proceeds
from sales of our investments. Our primary use of cash is investments in portfolio companies, payments of our expenses and cash distributions
to our stockholders. As of December 31, 2022 and 2021, we had cash of and $15,923,163 and $11,058,796, respectively.





62







Operating Activities



Net cash used in the operating activities for the
year ended December 31, 2022 was $43,806,970. The primary operating activity during this period was investments in portfolio companies
which generated interest and fee income. This was partially offset by repayments of bank loans and proceeds from investments sold. Net
cash provided by the operating activities for the year ended December 31, 2021 was $7,463,810. The primary operating activity during
this period was investments in portfolio companies which generated interest and fee income. This was partially offset by repayments of
bank loans and proceeds from investments sold.



As of December 31, 2022 and 2021, we had 66
and 36 investments with unfunded commitments of $24,258,010 and $13,913,615, respectively. We believe that, as of both December 31,
2022 and 2021, we had sufficient assets to adequately cover any obligations under our unfunded commitments.



The following table summarizes our total portfolio
activity during the years ended December 31, 2022 and 2021:



|                                                                    |  | Year Ended
 December 31, 2022 |             |   | Year Ended
 December 31, 2021 |  
|------------------------------------------------------------------- |  | ----------------------------- | ----------- | - | ----------------------------- | -
|Beginning investment portfolio                                      |  | $                             | 403,054,374 |   |                               | $
|Investments in new portfolio investments                            |  |                               | 103,470,665 |   |                               |  
|Investments in existing portfolio investments                       |  |                               | 9,492,066   |   |                               |  
|Principal repayments                                                |  |                               | (69,513,201 | ) |                               |  
|Proceeds from sales of investments                                  |  |                               | (21,825,900 | ) |                               |  
|Net change in unrealized (depreciation) appreciation on investments |  |                               | (5,633,954  | ) |                               |  
|Net realized gain (loss) on investments                             |  |                               | 853,764     |   |                               |  
|Net change in premiums, discounts and amortization                  |  |                               | 930,844     |   |                               |  
|Investment Portfolio, at Fair Value                                 |  | $                             | 420,828,658 |   |                               | $



Financing Activities



Net cash provided by our financing activities for
the year ended December 31, 2022 was $48,671,337, which consisted of $110,000,000 from issuances of 11,746,415 shares to our stockholders,
in connection with our capital calls during the period and a net $13,178,611 in connection with our short-term borrowings during the period.
This was partially offset by $50,000,000 in repurchases of 5,331,370 shares to our stockholders, in connection with our Tender Offers
during the period and distributions of $24,507,347 or $0.54 per share. Net cash used in our financing activities for the year ended December 31,
2021 was $694,136 from issuances of 1,617,822 of Shares to our shareholders, in connection with our capital calls during the period. These
capital calls were partially offset by distributions of $15,794,136 or $0.40 per share.



Equity Activity



An investor made capital commitments to us in the amounts set forth
below as of the date opposite each capital commitment:



|Amount |             |  | Date
|------ | ----------- |  | ----
|$      | 140,000,000 |  |     
|$      | 50,000,000  |  |     
|$      | 100,000,000 |  |     
|$      | 40,000,000  |  |     
|$      | 30,000,000  |  |     
|$      | 11,200,000  |  |     
|$      | 8,900,000   |  |     
|$      | 110,000,000 |  |     





63







As of December 31, 2022, there were no remaining
unfunded capital commitments by the Company’s investors.



The number of Shares issued and outstanding as
of December 31, 2022 and December 31, 2021, were 46,376,461 and 39,961,408, respectively.



The following table summarizes activity in the
number of Shares during the years ended December 31, 2022 and 2021:



|                                                                                                        |  | Common stock shares in issue  |           
|------------------------------------------------------------------------------------------------------- |  | ----------------------------- | ----------
|                                                                                                        |  | Year Ended
 December 31, 2022 |           
|Shares in issue, beginning of period                                                                    |  |                               | 39,961,408
|Common stock issued ($110,000,000 and $15,100,000, respectively)                                        |  |                               | 11,746,415
|Common stock repurchased ($50,000,000 and $0, respectively)                                             |  |                               | (5,331,370
|Issuance of common shares in connection
    with dividend reinvestment plan ($73 and $51, respectively) |  |                               | 8         
|Shares in issue, end of period                                                                          |  |                               | 46,376,461



Contractual Obligations



The
following table summarizesour significant contractual payment obligations as of December 31, 2022:



|                              |  | Payments Due by Period |           
|----------------------------- |  | ---------------------- | ----------
|                              |  | Total                  |           
|Unfunded commitments(1)       |  | $                      | 24,258,010
|Total contractual obligations |  | $                      | 24,258,010



| | (1) | Unfunded commitments represent all amounts unfunded as of December 31, 2022. These amounts may or may not be funded to the borrowing
party now or in the future. We reflect this amount in the less than one-year category because the entire amount was eligible for funding
as of December 31, 2022.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Distributions to Stockholders – Common Stock Distributions



We have elected to be treated as a RIC for U.S.
federal income tax purposes. As a RIC, we generally are not subject to corporate-level U.S. federal income taxes on ordinary income or
capital gains that we timely distribute as dividends for U.S. federal income tax purposes to our stockholders. To qualify to be taxed
as a RIC and thus avoid corporate-level income tax on the income that we distribute as dividends to our stockholders, we are required
to distribute dividends to our stockholders each taxable year generally of an amount at least equal to 90% of our investment company taxable
income, determined without regard to the deduction for any dividends paid. To avoid a 4% excise tax on undistributed earnings, we are
required to distribute dividends to our stockholders in respect of each calendar year of an amount at least equal to the sum of (i) 98%
of our ordinary income (taking into account certain deferrals and elections) for such calendar year, (ii) 98.2% of our capital gain
net income, adjusted for certain ordinary losses, for the one-year period ending October 31 of that calendar year and (iii) any
income or capital gains recognized, but not distributed, in preceding calendar years and on which we incurred no federal income tax. We
intend to make distributions to stockholders on an annual basis of substantially all of our net investment income. Although we intend
to make distributions of net realized capital gains, if any, at least annually, out of assets legally available for such distributions,
we may in the future decide to retain such capital gains for investment. In addition, the extent and timing of special dividends, if any,
will be determined by our Board of Directors and will largely be driven by portfolio specific events and tax considerations.





64







We may fund our cash distributions from any sources
of funds available, including offering proceeds, borrowings, net investment income from operations, capital gains proceeds from the sale
of assets, non-capital gains proceeds from the sale of assets, dividends or other distributions paid to us on account of preferred and
common equity investments in portfolio companies and fee waivers from our Adviser. Our distributions may exceed our earnings, especially
during the period before we have substantially invested the proceeds from an offering. As a result, a portion of the distributions we
may represent a return of capital for U.S. federal income tax purposes. Thus, the source of a distribution to our stockholders may be
the original capital invested by the stockholder rather than our income or gains. In addition, we may be limited in our ability to make
distributions due to the asset coverage test for borrowings applicable to us as a BDC under the 1940 Act. During the year ended December 31,
2022, we made two distributions totaling $24,507,347, or $0.54 per Share. During the year ended December 31, 2021, we made two distributions
totaling $15,794,187, or $0.40 per Share. The following tables provide the details of each distribution for the years ended December 31,
2022 and 2021.



| |  | 
| |  | 
| |  | 



|Period                 |                   | Declaration Date |                   | Record Date   |                   | Payment Date  |   | Distribution per Common Share |      
|---------------------- | ----------------- | ---------------- | ----------------- | ------------- | ----------------- | ------------- | - | ----------------------------- | -----
|Fiscal Year Ended 2022 |                   | June 17, 2022    |                   | June 22, 2022 |                   | June 24, 2022 |   | $                             | 0.340
|                       | December 12, 2022 |                  | December 14, 2022 |               | December 16, 2022 |               | $ | 0.200                         |      



|Period                 |                   | Declaration Date |                   | Record Date   |                   | Payment Date  |   | Distribution per Common Share |      
|---------------------- | ----------------- | ---------------- | ----------------- | ------------- | ----------------- | ------------- | - | ----------------------------- | -----
|Fiscal Year Ended 2021 |                   | June 11, 2021    |                   | June 14, 2021 |                   | June 16, 2021 |   | $                             | 0.200
|                       | December 10, 2021 |                  | December 13, 2021 |               | December 15, 2021 |               | $ | 0.200                         |      





Qualified Interest Income and Qualified Short-Term
Capital Gain (for non-U.S. resident shareholders only). Under the American Jobs Creation Act of 2004, the amounts of ordinary dividends
paid during the fiscal year ended December 31, 2021 are considered to be derived from “qualified interest income,” as
defined in Section 871(k)(1)(E) of the Code, and therefore are designated as interest-related dividends, as defined in Section 871(k)(1)(C) of
the Code. Further, the amounts of ordinary dividends paid during the fiscal year ended December 31, 2021 are considered to be derived
from “qualified short-term capital gain,” as defined in Section 871(k)(2)(D) of the Code, and therefore are designated
as qualified short-term gain dividends, as defined by Section 871(k)(2)(C) of the Code.



The determination of the tax attributes of our
distributions is made annually at the end of our taxable year, based upon our taxable income for the full taxable year and distributions
paid for the full taxable year. Therefore, estimates made on an interim basis may not be representative of the actual tax attributes of
distributions for a full year. The actual tax characteristics of distributions to stockholders will reported to stockholders subject to
information reporting after the close of each calendar year on Form 1099-DIV.



Related Party Fees



For the year ended December 31, 2022, the
Company recorded base management fees of $4,422,989 and waivers to the base management fees of $1,548,046, as set forth within the accompanying
statements of operations. For the year ended December 31, 2021, the Company recorded base management fees of $3,764,399 and waivers
to the base management fees of $1,317,540, as set forth within the accompanying statements of operations.



For the year ended December 31, 2022, the
Company recorded incentive fees of $3,454,468 and waivers to the incentive fees of $2,657,883, as set forth within the accompanying statements
of operations. For the year ended December 31, 2021, the Company recorded incentive fees of $848,440 and waivers to the incentive
fees of $763,596, as set forth within the accompanying statements of operations.



For each of the years ended December 31, 2022
and 2021, the Company recorded administrative fees of $265,000, as set forth within the accompanying statements of operations.





65







Fees
due to related parties as of December 31, 2022 and2021, as set forth on our accompanying statements of assets and liabilities
were as follows:



|                                          |  | December 31, 2022 |           |  | December 31, 2021 |  
|----------------------------------------- |  | ----------------- | --------- |  | ----------------- | -
|Net base management fee due to Adviser    |  | $                 | 732,900   |  |                   | $
|Net incentive fee due to Adviser          |  |                   | 404,409   |  |                   |  
|Total fees due to Adviser, net of waivers |  |                   | 1,137,309 |  |                   |  
|Fee due to Administrator, net of waivers  |  |                   | 66,250    |  |                   |  
|Total Related Party Fees Due              |  | $                 | 1,203,559 |  |                   | $



Tender Offers



To
provide our stockholders with limited liquidity, we may, in the absolute discretion of our Board of Directors, conduct an annual Tender
Offer. Our Tenders for the shares of Common Stock, if any, would be conducted on such terms as may be determined by our Board of Directors
and in accordance with the requirements of applicable law, including Section 23(c) of the 1940 Act and Regulation M under the
Exchange Act.On April 22, 2022, the Company issued a Tender Offer to repurchase $20.0 million worth of Common Stock from
the stockholders. The Offer was accepted on May 20, 2022. On July 14, 2022, the Company issued a Tender Offer to repurchase
$15.0 million worth of Common Stock from the stockholders. The Offer was accepted on August 11, 2022. On October 13, 2022, the
Company issued a Tender Offer to repurchase $15.0 million worth of Common Stock from the stockholders. The Offer was accepted on November 21,
2022.



CRITICAL ACCOUNTING POLICIES



This discussion of our operations is based upon
our financial statements, which are prepared in accordance with GAAP. The preparation of these financial statements requires our management
to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses.



Changes in the economic environment, financial
markets and any other parameters used in determining such estimates could cause actual results to differ. In addition to the discussion
below, we describe our critical accounting policies in the notes to our financial statements.



Valuation of Investments



We conduct the valuation of our investments, pursuant
to which our net asset value is determined, at all times consistent with GAAP and the 1940 Act. Our Board of Directors, with the assistance
of our Audit Committee, determines the fair value of our investments, for investments with a public market and for investments with no
readily available public market, on at least a quarterly basis, in accordance with the terms of ASC 820. Our valuation procedures are
set forth in more detail below.



ASC 820 defines fair value 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.” Fair value is a market-based measurement, not an entity-specific measurement. For some assets and liabilities, observable
market transactions or market information might be available. For other assets and liabilities, observable market transactions and market
information might not be available. However, the objective of a fair value measurement in both cases is the same – to estimate the
price when an orderly transaction to sell the asset or transfer the liability would take place between market participants at the measurement
date under current market conditions (that is, an exit price at the measurement date from the perspective of a market participant that
holds the asset or owes the liability).



ASC 820 establishes a hierarchal disclosure framework
which ranks the observability of inputs used in measuring financial instruments at fair value. The observability of inputs is impacted
by a number of factors, including the type of financial instruments and their specific characteristics. Financial instruments with readily
available quoted prices, or for which fair value can be measured from quoted prices in active markets, generally will have a higher degree
of market price observability and a lesser degree of judgment applied in determining fair value.





66







The three-level hierarchy for fair value measurement
is defined as follows:



Level
1— Inputs to the valuation methodology are quoted prices available in active markets for identical financial instruments
as of the measurement date. The types of financial instruments in this category include unrestricted securities, including equities and
derivatives, listed in active markets. We do not adjust the quoted price for these instruments, even in situations where we hold a large
position, and a sale could reasonably be expected to impact the quoted price.



Level
2— Inputs to the valuation methodology are quoted prices in markets that are not active or for which all significant
inputs are either directly or indirectly observable as of the measurement date. The types of financial instruments in this category include
less liquid and restricted securities listed in active markets, securities traded in markets that are not active, government and agency
securities, and certain over-the-counter derivatives where the fair value is based on observable inputs.



Level
3— Inputs to the valuation methodology are unobservable and significant to the overall fair value measurement, and include
situations where there is little, if any, market activity for the investment. The inputs into the determination of fair value require
significant management judgment or estimation. The types of financial instruments in this category include investments in privately held
entities, non-investment grade residual interests in securitizations, collateralized loan obligations, and certain over-the-counter derivatives
where the fair value is based on unobservable inputs.



In certain cases, the inputs used to measure fair
value may fall into different levels of the fair value hierarchy. In such cases, the determination of which category within the fair value
hierarchy is appropriate for any given financial instrument is based on the lowest level of input that is significant to the fair value
measurement. Assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and
considers factors specific to the financial instrument.



Pursuant to the framework set forth above, we value
securities traded in active markets on the measurement date by multiplying the exchange closing price of such traded securities/instruments
by the quantity of shares or amount of the instrument held. We may also obtain quotes with respect to certain of our investments from
pricing services, brokers or dealers’ quotes, or counterparty marks in order to value liquid assets that are not traded in active
markets.



Pricing services aggregate, evaluate and report
pricing from a variety of sources including observed trades of identical or similar securities, broker or dealer quotes, model-based valuations
and internal fundamental analysis and research. When doing so, we determine whether the quote obtained is sufficient according to GAAP
to determine the fair value of the security. If determined adequate, we use the quote obtained.



Securities that are illiquid or for which the pricing
source does not provide a valuation or methodology or provides a valuation or methodology that, in the judgment of our Board of Directors,
does not represent fair value, are each valued as of the measurement date using all techniques appropriate under the circumstances and
for which sufficient data are available. These valuation techniques vary by investment but include comparable public market valuations,
comparable precedent transaction valuations and discounted cash flow analyses. Inputs for these valuation techniques include relative
credit information, observed market movement, industry sector information, and other market data, which may include benchmarking of comparable
securities, issuer spreads, reported trades, and reference data, such as market research publications, when available. The process used
to determine the applicable value is as follows:



(i) Each portfolio company or investment is
initially valued by the investment professionals of the Adviser responsible for the portfolio investment using a standardized template
designed to approximate fair market value based on observable market inputs and updated credit statistics and unobservable inputs. Additionally,
as a part of our valuation process, the Adviser may employ the services of one or more independent valuation firms engaged by us;





67







(ii) Preliminary valuation conclusions are
documented and discussed with our senior management and members of the Adviser’s valuation team;



(iii) Our Audit Committee reviews the assessments
of the Adviser or independent valuation firm (to the extent applicable) and provides our Board of Directors with recommendations with
respect to the fair value of the investments in our portfolio; and



(iv) Our Board of Directors discusses the
valuation recommendations of our Audit Committee and determines the fair value of the investments in our portfolio in good faith based
on the input of the Adviser, the independent valuation firm (to the extent applicable) and in accordance with our valuation policy.



Our Audit Committee’s recommendation of fair
value is generally based on its assessment of the following factors, as relevant:



| | · | the nature and realizable value of any collateral;
| | - | --------------------------------------------------



| | · | call features, put features and other relevant terms of debt;
| | - | -------------------------------------------------------------



| | · | the portfolio company’s ability to make payments;
| | - | -------------------------------------------------



| | · | the portfolio company’s actual and expected earnings and discounted cash flow;
| | - | ------------------------------------------------------------------------------



| | · | prevailing interest rates for like securities and expected volatility in future interest rates;
| | - | -----------------------------------------------------------------------------------------------



| | · | the markets in which the portfolio company does business and recent economic and/or market events; and
| | - | ------------------------------------------------------------------------------------------------------



| | · | comparisons to publicly traded securities.
| | - | ------------------------------------------



Investment performance data utilized are the most
recently available as of the measurement date, which in many cases may reflect up to a one quarter lag in information.



Securities for which market quotations are not
readily available or for which a pricing source is not sufficient may include the following:



| | · | private placements and restricted securities that do not have an active trading market;
| | - | ---------------------------------------------------------------------------------------



| | · | securities whose trading has been suspended or for which market quotes are no longer available;
| | - | -----------------------------------------------------------------------------------------------



| | · | debt securities that have recently gone into default and for which there is no current market;
| | - | ----------------------------------------------------------------------------------------------



| | · | securities whose prices are stale; and
| | - | --------------------------------------



| | · | securities affected by significant events.
| | - | ------------------------------------------



Our Board of Directors is responsible for the determination,
in good faith, of the fair value of our portfolio investments.



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



Security transactions are recorded on the trade
date (the date the order to buy or sell is executed or, in the case of privately issued securities, the closing date, which is when all
terms of the transactions have been defined). Realized gains and losses on investments are determined based on the identified cost method.





68







In addition, on December 3, 2020, the SEC
announced that it adopted Rule 2a-5 under the 1940 Act, which establishes an updated regulatory framework for determining fair value
in good faith for purposes of the 1940 Act. The adopted rule clarifies how fund boards can satisfy their valuation obligations in
light of recent market developments. The rule permits boards, subject to board oversight and certain other conditions, to designate
certain parties to perform the fair value determinations.



Refer to Note 3 — Investmentsin the
notes to our accompanying financial statements included elsewhere in this quarterly report for additional information regarding fair value
measurements and our application of ASC 820.



Revenue Recognition



We record interest income on an accrual basis to
the extent that we expect to collect such amounts. For loans and debt securities with contractual PIK interest, which represents contractual
interest accrued and added to the principal balance, we generally will not accrue PIK interest for accounting purposes if the portfolio
company valuation indicates that such PIK interest is not collectible. We do not accrue as a receivable interest on loans and debt securities
for accounting purposes if we have reason to doubt our ability to collect such interest. OID, market discounts or premiums are accreted
or amortized using the effective interest method as interest income. We record prepayment premiums on loans and debt securities as interest
income.



Net Realized Gains or Losses and Net Change in Unrealized Appreciation
or Depreciation



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



PIK Interest



We may have investments in our portfolio that contain
a PIK interest provision. Any PIK interest will be added to the principal balance of such investments and is recorded as income if the
portfolio company valuation indicates that such PIK interest is collectible. In order to maintain our status as a RIC, substantially all
of this income must be included in the amounts paid out by us to stockholders in the form of dividends, even if we have not collected
any cash.



U.S. Income Taxes



We have elected to be subject to tax as a RIC under
Subchapter M of the Code. As a RIC, we generally will not have to incur any corporate-level U.S. federal income taxes on any ordinary
income or capital gains that we distribute as dividends to our stockholders. To qualify and maintain our qualification as a RIC, we must
meet certain source-of-income and asset diversification requirements as well as distribute dividends to our stockholders each taxable
year of an amount generally at least equal to 90% of our investment company taxable income, determined without regard to any distributions
paid.



Depending on the level of taxable income earned
in a taxable year, we may choose to retain taxable income in excess of current year distributions into the next taxable year. We would
then incur a 4% excise tax on such taxable income, as required. To the extent that we determine that our estimated current year annual
taxable income may exceed estimated current year distributions, we will accrue an excise tax, if any, on estimated excess taxable income
as taxable income is earned. We did not accrue any excise tax for the fiscal years ended December 31, 2022, 2021, and 2020.



Because U.S. federal income tax regulations differ
from GAAP, distributions in accordance with tax regulations may differ from net investment income and realized gains recognized for financial
reporting purposes. Differences may be permanent or temporary. Permanent differences are reclassified within capital accounts in the financial
statements to reflect their tax character. Permanent differences may also result from differences in classification in certain items,
such as the treatment of short-term gains as ordinary income for tax purposes. Temporary differences arise when certain items of income,
expense, gain or loss are recognized at some time in the future.





69







We evaluate tax positions taken or expected to
be taken in the course of preparing our financial statements to determine whether any relevant tax positions would “more-likely-than-not”
be sustained by the applicable tax authority. Tax positions not deemed to meet the “more-likely-than-not” threshold are reversed
and recorded as a tax benefit or expensed in the current fiscal year. All penalties and interest associated with any income taxes accrued
are included in income tax expense. Conclusions regarding tax positions are subject to review and may be adjusted at a later date based
on factors including, but not limited to, ongoing analyses of tax law, regulations and interpretations thereof. Our accounting policy
on income taxes is critical because if we are unable to qualify, or once qualified, maintain our tax status as a RIC, we would be required
to record a provision for corporate-level U.S. federal income taxes, as well as any related state or local taxes which may be significant
to our financial results.



COMMITMENTS AND CONTINGENCIES



Unfunded commitments to provide funds to portfolio
companies are not reflected in our accompanying statements of assets and liabilities. Our unfunded commitments may be significant from
time to time. These commitments are subject to the same underwriting and ongoing portfolio maintenance as are the on-balance sheet financial
instruments that we hold. Since these commitments may expire without being drawn, the total commitment amount does not necessarily represent
future cash requirements. We use cash flow from normal and early principal repayments and proceeds from borrowings and offerings to fund
these commitments. As of December 31, 2022, we had 66 investments with unfunded commitments of $24,258,010. As of December 31,
2021, we had 36 investments with unfunded commitments of $13,913,615. We believe that, as of December 31, 2022 and 2021, we had sufficient
assets to adequately cover any obligations under our unfunded commitments.



ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK



We are subject to financial market risks, including
changes in interest rates. During the period covered by our financial statements, many of the loans in our portfolio had floating interest
rates, and we expect that many of our loans to portfolio companies in the future will also have floating interest rates based on LIBOR
or an equivalent risk-free index rate. Interest rate fluctuations may have a substantial negative impact on our investments, the value
of our Common Stock and our rate of return on invested capital. In addition, U.S. and global capital markets and credit markets have experienced
a higher level of stress due to the global COVID-19 pandemic, which has resulted in an increase in the level of volatility across such
markets and a general decline in value of the securities held by us. As a result, there can be no assurance that a significant change
in market interest rates will not have a material adverse effect on our net investment income.



In addition, inflation resulting from supply chain
disruptions caused by the war between Russia and Ukraine and the COVID-19 pandemic has resulted in a general increase of certain interest
rates by the U.S. Federal Reserve and other central banks. A continued increase in interest rates, including SOFR, could affect our gross
investment income.



|                         | 
|------------------------ | 
|Change in interest rates | 
|Up 300 basis points      | 
|Up 200 basis points      | 
|Up 100 basis points      | 
|Down 100 basis points    | 
|Down 200 basis points    | 
|Down 300 basis points    | 





70







Although we believe that this measure is indicative
of our sensitivity to interest rate changes, it does not reflect potential changes in the credit market, credit quality, size and composition
of the assets on the Consolidated Statements of Assets and Liabilities and other business developments that could affect our net increase
in net assets resulting from operations or net investment income. Accordingly, no assurances can be given that actual results would not
differ materially from those shown above.



In addition, any investments we make that are denominated
in a foreign currency will be subject to risks associated with changes in currency exchange rates. These risks include the possibility
of significant fluctuations in the foreign currency markets, the imposition or modification of foreign exchange controls and potential
illiquidity in the secondary market. These risks will vary depending upon the currency or currencies involved.



We may hedge against interest rate and currency
exchange rate fluctuations 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 benefits of lower interest rates with respect to our portfolio of investments with fixed interest rates.





71









ITEM 8. FINANCIAL STATEMENTS AND
SUPPLEMENTARY DATA



Index to Financial Statements



|Report of Independent
    of Registered Public Accounting Firm                                | 73
|--------------------------------------------------------------------------------------------- | --
|Statements of Assets and Liabilities
    as of December 31, 2022 and 2021                     | 74
|Statements of Operations for
    the Years Ended December 31, 2022, 2021, and 2020            | 75
|Statements of Changes in Net
    Assets for the Years Ended December 31, 2022, 2021, and 2020 | 76
|Statements of Cash Flows for
    the Years Ended December 31, 2022, 2021, and 2020            | 77
|Schedules of Investments as
    of December 31, 2022 and 2021                                 | 78
|Notes to Financial Statements                                                                 | 88





72







Report of Independent Registered
Public Accounting Firm



To the Shareholders and Board
of Directors of Audax Credit BDC Inc.



Opinion on the Financial Statements

We have audited the accompanying
statements of assets and liabilities of Audax Credit BDC Inc. (the “Company”), including the schedules of investments, as
of December 31, 2022 and 2021, the related statements of operations, changes in net assets, and cash flows for each of the three years
in the period ended December 31, 2022, and the related notes (collectively referred to as the “financial statements”). In
our opinion, the financial statements present fairly, in all material respects, the financial position of the Company at December 31,
2022 and 2021, and the results of its operations, changes in its net assets and its cash flows for each of the three years in the period
ended December 31, 2022, in conformity with U.S. generally accepted accounting principles.



Basis for Opinion

These financial statements are
the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based
on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”)
and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable
rules and regulations of the Securities and Exchange Commission and the PCAOB.



We conducted our audits in accordance
with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were
we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding
of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal
control over financial reporting. Accordingly, we express no such opinion.



Our audits included performing
procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures
that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the
financial statements. Our procedures included confirmation of securities owned as of December 31, 2022 and 2021, by correspondence with
the custodian, brokers and others; when replies were not received from brokers or others, we performed other auditing procedures. Our
audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the
overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.





/s/ Ernst & Young LLP





We have served as the auditor
of the Company since 2015.



New York, NY

March 20, 2023





73







Audax Credit BDC Inc.

Statements of Assets and Liabilities

December 31, 2022 and December 31,
2021

(Expressed
in U.S. Dollars)



|                                                                                                                                                |  | December 31, 2022 |             |   | December 31, 2021 |  
|----------------------------------------------------------------------------------------------------------------------------------------------- |  | ----------------- | ----------- | - | ----------------- | -
|Assets                                                                                                                                          |  |                   |             |   |                   |  
|Investments, at fair value                                                                                                                      |  |                   |             |   |                   |  
|Non-Control/Non-Affiliate investments (Cost of $427,700,856 and $404,292,618, respectively)                                                     |  | $                 | 420,828,658 |   |                   | $
|Cash and cash equivalents                                                                                                                       |  |                   | 15,923,163  |   |                   |  
|Receivable from investments sold                                                                                                                |  |                   | 4,415,431   |   |                   |  
|Interest receivable                                                                                                                             |  |                   | 2,421,871   |   |                   |  
|Receivable from bank loan repayment                                                                                                             |  |                   | 61,072      |   |                   |  
|Total assets                                                                                                                                    |  | $                 | 443,650,195 |   |                   | $
|                                                                                                                                                |  |                   |             |   |                   |  
|Liabilities                                                                                                                                     |  |                   |             |   |                   |  
|Payable for short-term borrowings(a)                                                                                                            |  | $                 | 13,178,611  |   |                   | $
|Fees due to investment advisor, net of waivers(b)                                                                                               |  |                   | 1,137,309   |   |                   |  
|Fee due to administrator(b)                                                                                                                     |  |                   | 66,250      |   |                   |  
|Payable for investments purchased                                                                                                               |  |                   | -           |   |                   |  
|Accrued expenses and other liabilities                                                                                                          |  |                   | 790,347     |   |                   |  
|Total liabilities                                                                                                                               |  | $                 | 15,172,517  |   |                   | $
|Commitments and contingencies(c)                                                                                                                |  |                   |             |   |                   |  
|                                                                                                                                                |  |                   |             |   |                   |  
|Net Assets                                                                                                                                      |  |                   |             |   |                   |  
|Common stock, $0.001 par value per share, 100,000,000 shares authorized,  46,376,461 and 39,961,408 shares issued and outstanding, respectively |  | $                 | 46,376      |   |                   | $
|Capital in excess of par value                                                                                                                  |  |                   | 437,955,965 |   |                   |  
|Total distributable loss                                                                                                                        |  |                   | (9,524,663  | ) |                   |  
|Total Net Assets                                                                                                                                |  | $                 | 428,477,678 |   |                   | $
|Net Asset Value per Share of Common Stock at End of Period                                                                                      |  | $                 | 9.24        |   |                   | $
|                                                                                                                                                |  |                   |             |   |                   |  
|Shares Outstanding                                                                                                                              |  |                   | 46,376,461  |   |                   |  



| | (a) | Refer
to Note 8-Borrowings for additional information.                   
| | --- | -------------------------------------------------------------------------
| | (b) | Refer
to Note 4-Related Party Transactions for additional information.   
| | (c) | Refer
to Note 9-Commitments and Contingencies for additional information.





74







Audax Credit BDC Inc.

Statements of Operations

For Years Ended December 31,
2022, 2021, and 2020

(Expressed
in U.S. Dollars)



|                                                                      |  | Year Ended

    December 31, 2022 |            |   | Year Ended

    December 31, 2021 |   |            | Year Ended

    December 31, 2020 | 
|--------------------------------------------------------------------- |  | --------------------------------- | ---------- | - | --------------------------------- | - | ---------- | --------------------------------- | 
|Investment Income                                                     |  |                                   |            |   |                                   |   |            |                                   | 
|Interest income                                                       |  |                                   |            |   |                                   |   |            |                                   | 
|Non-Control/Non-Affiliate                                             |  | $                                 | 29,155,188 |   |                                   | $ | 19,351,092 |                                   | 
|Other                                                                 |  |                                   | 44,174     |   |                                   |   | 1,634      |                                   | 
|Total interest income                                                 |  |                                   | 29,199,362 |   |                                   |   | 19,352,726 |                                   | 
|Other income                                                          |  |                                   |            |   |                                   |   |            |                                   | 
|Non-Control/Non-Affiliate                                             |  |                                   | 459,154    |   |                                   |   | 111,954    |                                   | 
|Total income                                                          |  |                                   | 29,658,516 |   |                                   |   | 19,464,680 |                                   | 
|                                                                      |  |                                   |            |   |                                   |   |            |                                   | 
|Expenses                                                              |  |                                   |            |   |                                   |   |            |                                   | 
|Base management fee(a)                                                |  | $                                 | 4,422,989  |   |                                   | $ | 3,764,399  |                                   | 
|Incentive fee(a)                                                      |  |                                   | 3,454,468  |   |                                   |   | 848,440    |                                   | 
|Interest expense(b)                                                   |  |                                   | 712,005    |   |                                   |   | -          |                                   | 
|Professional fees                                                     |  |                                   | 643,991    |   |                                   |   | 488,934    |                                   | 
|Other expenses                                                        |  |                                   | 308,184    |   |                                   |   | 391,921    |                                   | 
|Administrative fee(a)                                                 |  |                                   | 265,000    |   |                                   |   | 265,000    |                                   | 
|Directors' fees                                                       |  |                                   | 240,000    |   |                                   |   | 225,000    |                                   | 
|Expenses before waivers from investment adviser and administrator     |  |                                   | 10,046,637 |   |                                   |   | 5,983,694  |                                   | 
|Base management fee waivers(a)                                        |  |                                   | (1,548,046 | ) |                                   |   | (1,317,540 | )                                 | 
|Incentive fee waivers(a)                                              |  |                                   | (2,657,883 | ) |                                   |   | (763,596   | )                                 | 
|Total expenses, net of waivers                                        |  |                                   | 5,840,708  |   |                                   |   | 3,902,558  |                                   | 
|Net Investment Income                                                 |  |                                   | 23,817,808 |   |                                   |   | 15,562,122 |                                   | 
|                                                                      |  |                                   |            |   |                                   |   |            |                                   | 
|Realized and Unrealized Gain (Loss) on Investments                    |  |                                   |            |   |                                   |   |            |                                   | 
|Net realized gain (loss) on investments                               |  |                                   | 853,764    |   |                                   |   | (196,218   | )                                 | 
|Net change in unrealized (depreciation) appreciation on investments   |  |                                   | (5,633,954 | ) |                                   |   | 2,392,705  |                                   | 
|Net realized and unrealized (loss) gain on investments                |  |                                   | (4,780,190 | ) |                                   |   | 2,196,487  |                                   | 
|                                                                      |  |                                   |            |   |                                   |   |            |                                   | 
|Net Increase in Net Assets Resulting from Operations                  |  | $                                 | 19,037,618 |   |                                   | $ | 17,758,609 |                                   | 
|                                                                      |  |                                   |            |   |                                   |   |            |                                   | 
|Basic and Diluted per Share of Common Stock:                          |  |                                   |            |   |                                   |   |            |                                   | 
|Net investment income                                                 |  | $                                 | 0.53       |   |                                   | $ | 0.39       |                                   | 
|Net increase in net assets resulting from operations                  |  | $                                 | 0.42       |   |                                   | $ | 0.45       |                                   | 
|                                                                      |  |                                   |            |   |                                   |   |            |                                   | 
|Weighted average shares of common stock outstanding
    basic diluted |  |                                   | 45,106,946 |   |                                   |   | 39,463,569 |                                   | 



| | (a) | Refer
to Note 4-Related Party Transactions for additional information
| | --- | ---------------------------------------------------------------------
| | (b) | Refer
to Note 8-Borrowings for additional information.               





75







Audax Credit BDC Inc.

Statements of Changes in Net Assets

For the Years Ended December 31,
2022, 2021, and 2020

(Expressed
in U.S. Dollars)



|                                                                    |  | Year Ended December 31, 2022 |             |   | Year Ended December 31, 2021 |   |             | Year Ended December 31, 2020 | 
|------------------------------------------------------------------- |  | ---------------------------- | ----------- | - | ---------------------------- | - | ----------- | ---------------------------- | 
|Operations                                                          |  |                              |             |   |                              |   |             |                              | 
|Net investment income                                               |  | $                            | 23,817,808  |   |                              | $ | 15,562,122  |                              | 
|Net realized gain (loss) on investments                             |  |                              | 853,764     |   |                              |   | (196,218    | )                            | 
|Net change in unrealized (depreciation) appreciation on investments |  |                              | (5,633,954  | ) |                              |   | 2,392,705   |                              | 
|Net increase in net assets resulting from operations                |  |                              | 19,037,618  |   |                              |   | 17,758,609  |                              | 
|                                                                    |  |                              |             |   |                              |   |             |                              | 
|Distributions:                                                      |  |                              |             |   |                              |   |             |                              | 
|Distributions of ordinary income to common stockholders             |  |                              | (23,797,493 | ) |                              |   | (15,541,807 | )                            | 
|Return of capital to common stockholders                            |  |                              | (709,854    | ) |                              |   | (252,380    | )                            | 
|Total distributions                                                 |  |                              | (24,507,347 | ) |                              |   | (15,794,187 | )                            | 
|                                                                    |  |                              |             |   |                              |   |             |                              | 
|Capital Share Transactions:                                         |  |                              |             |   |                              |   |             |                              | 
|Issuance of common stock                                            |  |                              | 110,000,000 |   |                              |   | 15,100,000  |                              | 
|Repurchases of common stock                                         |  |                              | (50,000,000 | ) |                              |   | -           |                              | 
|Reinvestment of common stock                                        |  |                              | 73          |   |                              |   | 51          |                              | 
|Net increase in net assets from capital share transactions          |  |                              | 60,000,073  |   |                              |   | 15,100,051  |                              | 
|                                                                    |  |                              |             |   |                              |   |             |                              | 
|Net Increase in Net Assets                                          |  |                              | 54,530,344  |   |                              |   | 17,064,473  |                              | 
|Net Assets, Beginning of Period                                     |  |                              | 373,947,334 |   |                              |   | 356,882,861 |                              | 
|Net Assets, End of Period                                           |  | $                            | 428,477,678 |   |                              | $ | 373,947,334 |                              | 





76







Audax Credit BDC Inc.

Statements of Cash Flows

For Years Ended December 31,
2022, 2021, and 2020

(Expressed
in U.S. Dollars)



|                                                                                                                             |  | Year Ended

    December 31, 2022 |              |   | Year Ended

    December 31, 2021 |   |              | Year Ended

    December 31, 2020 | 
|---------------------------------------------------------------------------------------------------------------------------- |  | --------------------------------- | ------------ | - | --------------------------------- | - | ------------ | --------------------------------- | 
|Cash flows from operating activities:                                                                                        |  |                                   |              |   |                                   |   |              |                                   | 
|Net increase in net assets resulting from operations                                                                         |  | $                                 | 19,037,618   |   |                                   | $ | 17,758,609   |                                   | 
|Adjustments to reconcile net increase in net assets from  operations to net cash (used in) provided by operating activities: |  |                                   |              |   |                                   |   |              |                                   | 
|Net realized (gain) loss on investments                                                                                      |  |                                   | (853,764     | ) |                                   |   | 196,218      |                                   | 
|Net change in unrealized depreciation (appreciation) on investments                                                          |  |                                   | 5,633,954    |   |                                   |   | (2,392,705   | )                                 | 
|Accretion of original issue discount interest and payment-in-kind interest                                                   |  |                                   | (930,844     | ) |                                   |   | (695,803     | )                                 | 
|Increase (decrease) in receivable from investments sold                                                                      |  |                                   | (4,415,431   | ) |                                   |   | -            |                                   | 
|Increase in interest receivable                                                                                              |  |                                   | (1,378,317   | ) |                                   |   | (89,542      | )                                 | 
|Increase (decrease) in receivable from bank loan repayment                                                                   |  |                                   | (34,301      | ) |                                   |   | (26,771      | )                                 | 
|Increase in accrued expenses and other liabilities                                                                           |  |                                   | 463,850      |   |                                   |   | 9,975        |                                   | 
|Increase (decrease) in fees due to investment advisor(a)                                                                     |  |                                   | 496,980      |   |                                   |   | 25,485       |                                   | 
|(Decrease) increase in payable for investments purchased                                                                     |  |                                   | (40,203,085  | ) |                                   |   | 37,480,585   |                                   | 
|Investment activity:                                                                                                         |  |                                   |              |   |                                   |   |              |                                   | 
|Investments purchased                                                                                                        |  |                                   | (112,962,731 | ) |                                   |   | (159,699,549 | )                                 | 
|Proceeds from investments sold                                                                                               |  |                                   | 21,825,900   |   |                                   |   | 15,117,554   |                                   | 
|Repayment of bank loans                                                                                                      |  |                                   | 69,513,201   |   |                                   |   | 99,779,754   |                                   | 
|Total investment activity                                                                                                    |  |                                   | (21,623,630  | ) |                                   |   | (44,802,241  | )                                 | 
|                                                                                                                             |  |                                   |              |   |                                   |   |              |                                   | 
|Net cash (used in) provided by operating activities                                                                          |  |                                   | (43,806,970  | ) |                                   |   | 7,463,810    |                                   | 
|                                                                                                                             |  |                                   |              |   |                                   |   |              |                                   | 
|Cash flows from financing activities:                                                                                        |  |                                   |              |   |                                   |   |              |                                   | 
|Issuance of shares of common stock                                                                                           |  |                                   | 110,000,073  |   |                                   |   | 15,100,000   |                                   | 
|Repurchases of shares of common stock                                                                                        |  |                                   | (50,000,000  | ) |                                   |   | -            |                                   | 
|Distributions paid to common stockholders                                                                                    |  |                                   | (24,507,347  | ) |                                   |   | (15,794,136  | )                                 | 
|Short-term borrowings(b)                                                                                                     |  |                                   | 47,154,556   |   |                                   |   | -            |                                   | 
|Repayments of short-term borrowings(b)                                                                                       |  |                                   | (33,975,945  | ) |                                   |   | -            |                                   | 
|                                                                                                                             |  |                                   |              |   |                                   |   |              |                                   | 
|Net cash provided by (used in) financing activities                                                                          |  |                                   | 48,671,337   |   |                                   |   | (694,136     | )                                 | 
|                                                                                                                             |  |                                   |              |   |                                   |   |              |                                   | 
|Net increase (decrease) in cash and cash equivalents                                                                         |  |                                   | 4,864,367    |   |                                   |   | 6,769,674    |                                   | 
|                                                                                                                             |  |                                   |              |   |                                   |   |              |                                   | 
|Cash and cash equivalents:                                                                                                   |  |                                   |              |   |                                   |   |              |                                   | 
|Cash and cash equivalents, beginning of period                                                                               |  |                                   | 11,058,796   |   |                                   |   | 4,289,122    |                                   | 
|                                                                                                                             |  |                                   |              |   |                                   |   |              |                                   | 
|Cash and cash equivalents, end of period                                                                                     |  | $                                 | 15,923,163   |   |                                   | $ | 11,058,796   |                                   | 
|                                                                                                                             |  |                                   |              |   |                                   |   |              |                                   | 
|Supplemental cash flow information                                                                                           |  |                                   |              |   |                                   |   |              |                                   | 
|Interest paid on short-term financing                                                                                        |  | $                                 | 353,664      |   |                                   | $ | -            |                                   | 
|                                                                                                                             |  |                                   |              |   |                                   |   |              |                                   | 
|Supplemental non-cash information                                                                                            |  |                                   |              |   |                                   |   |              |                                   | 
|Issuance of common shares in connection with dividend reinvestment plan                                                      |  | $                                 | 73           |   |                                   | $ | 51           |                                   | 
|Payment-in-kind ("PIK") interest income                                                                                      |  | $                                 | 239,601      |   |                                   | $ | 257,412      |                                   | 



| | (a) | Refer
to Note 4-Related Party Transactions for additional information
| | --- | ---------------------------------------------------------------------
| | (b) | Refer
to Note 8-Borrowings for additional information.               





77







Audax Credit BDC Inc.

Schedules of Investments

As of December 31, 2022

(Expressed in U.S. Dollars)



|Portfolio
    Investments (a) (b) (c) (d) (e) (f)                                                                                       |  | Acquisition
 Date |  | Par |           |  | Cost |   |           | Value | 
|--------------------------------------------------------------------------------------------------------------------------------------- |  | ----------------- |  | --- | --------- |  | ---- | - | --------- | ----- | 
|BANK
    LOANS: NON-CONTROL/NON-AFFILIATE INVESTMENTS - (97.4%)(g)(h):                                                                  |  |                   |  |     |           |  |      |   |           |       | 
|                                                                                                                                        |  |                   |  |     |           |  |      |   |           |       | 
|Healthcare & Pharmaceuticals                                                                                                            |  |                   |  |     |           |  |      |   |           |       | 
|American
    Vision Partners, Unitranche Initial Term Loan, 10.52% (LIBOR + 5.75%), maturity 9/30/27 (i)                                |  | 9/22/2021         |  | $   | 4,948,401 |  |      | $ | 4,879,828 |       | 
|RevHealth,
    Unitranche Initial Term Loan, 10.34% (SOFR + 5.75%), maturity 7/22/28 (i)                                                |  | 7/22/2022         |  |     | 4,270,120 |  |      |   | 4,188,380 |       | 
|Radiology Partners, Senior Secured
    Term B Loan (First Lien), 9.02% (LIBOR + 4.25%), maturity 7/9/25                                 |  | 6/28/2018         |  |     | 4,215,792 |  |      |   | 4,360,152 |       | 
|Young Innovations, Senior Secured
    Initial Term Loan (First Lien), 8.77% (LIBOR + 4.00%), maturity 11/7/24                           |  | 11/6/2017         |  |     | 3,716,210 |  |      |   | 3,710,302 |       | 
|PharMedQuest,
    Unitranche Term A Loan, 10.09% (SOFR + 5.50%), maturity 11/6/24 (i)                                                   |  | 11/6/2019         |  |     | 3,280,898 |  |      |   | 3,270,149 |       | 
|Zest
    Dental, Senior Secured Initial Term Loan (First Lien), 8.27% (LIBOR + 3.50%), maturity 3/14/25 (j)                             |  | 5/30/2018         |  |     | 3,222,954 |  |      |   | 3,231,080 |       | 
|InHealth Medical Alliance, Unitranche
    Initial Term Loan, 8.09% (SOFR + 3.50%) 3.50% PIK, maturity 6/28/28                           |  | 6/25/2021         |  |     | 3,473,575 |  |      |   | 3,444,004 |       | 
|InterMed,
    Unitranche Initial Term Loan, 11.09% (SOFR + 6.50%), maturity 12/24/29 (i) (j)                                            |  | 12/22/2022        |  |     | 3,023,758 |  |      |   | 2,937,365 |       | 
|Waystar, Senior Secured Initial
    Term Loan (First Lien), 8.77% (LIBOR + 4.00%), maturity 10/22/26                                    |  | 9/19/2019         |  |     | 2,919,950 |  |      |   | 2,914,826 |       | 
|Advancing Eyecare, Senior Secured
    Initial Term Loan, 10.34% (SOFR + 5.75%), maturity 6/29/29                                        |  | 5/27/2022         |  |     | 2,531,655 |  |      |   | 2,465,757 |       | 
|Premise Health, Senior Secured
    Initial Term Loan (First Lien), 8.09% (SOFR + 3.50%), maturity 7/10/25                               |  | 8/15/2018         |  |     | 2,259,008 |  |      |   | 2,262,783 |       | 
|Soliant, Senior Secured Initial
    Term Loan, 8.77% (LIBOR + 4.00%), maturity 3/31/28                                                  |  | 3/26/2021         |  |     | 2,115,249 |  |      |   | 2,100,146 |       | 
|nThrive, Senior Secured Initial
    Loan (Second Lien), 11.52% (LIBOR + 6.75%), maturity 12/17/29                                       |  | 11/19/2021        |  |     | 2,000,000 |  |      |   | 1,975,615 |       | 
|CPS,
    Unitranche Closing Date Term Loan, 10.52% (LIBOR + 5.75%), maturity 6/1/28 (i)                                                 |  | 5/18/2022         |  |     | 1,953,546 |  |      |   | 1,948,936 |       | 
|Gastro Health, Senior Secured
    Initial Term Loan (First Lien), 9.27% (LIBOR + 4.50%), maturity 7/3/28                                |  | 7/2/2021          |  |     | 1,974,288 |  |      |   | 1,964,641 |       | 
|Upstream Rehabilitation, Senior
    Secured August 2021 Incremental Term Loan (First Lien), 8.84% (SOFR + 4.25%), maturity 11/20/26     |  | 10/24/2019        |  |     | 1,951,531 |  |      |   | 1,949,032 |       | 
|Avalign Technologies, Senior Secured
    Initial Term Loan (First Lien), 9.09% (SOFR + 4.50%), maturity 12/22/25                        |  | 12/19/2018        |  |     | 1,920,000 |  |      |   | 1,916,944 |       | 
|Therapy Brands, Senior Secured
    Initial Term Loan (First Lien), 8.77% (LIBOR + 4.00%), maturity 5/18/28                              |  | 5/12/2021         |  |     | 1,863,262 |  |      |   | 1,855,208 |       | 
|Advanced Diabetes Supply, Senior
    Secured First Incremental Term Loan, 9.84% (SOFR + 5.25%), maturity 12/30/27                       |  | 7/13/2021         |  |     | 1,853,637 |  |      |   | 1,837,653 |       | 
|Press
    Ganey, Senior Secured Initial Term Loan (First Lien), 8.27% (LIBOR + 3.50%), maturity 7/24/26 (j)                             |  | 7/23/2019         |  |     | 1,935,000 |  |      |   | 1,938,010 |       | 
|Blue Cloud, Unitranche Closing
    Date Term Loan, 9.59% (SOFR + 5.00%), maturity 1/21/28                                               |  | 12/13/2021        |  |     | 1,488,750 |  |      |   | 1,467,872 |       | 
|Quantum Health, Senior Secured
    Amendment No. 1 Refinancing Term Loan (First Lien), 9.27% (LIBOR + 4.50%), maturity 12/22/27         |  | 12/18/2020        |  |     | 1,477,500 |  |      |   | 1,459,860 |       | 
|Mission Vet Partners, Senior Secured
    Initial Term Loan (First Lien), 8.77% (LIBOR + 4.00%), maturity 4/27/28                        |  | 12/15/2021        |  |     | 1,481,250 |  |      |   | 1,468,364 |       | 
|Symplr, Senior Secured Initial
    Term Loan (First Lien), 9.09% (SOFR + 4.50%), maturity 12/22/27                                      |  | 11/23/2020        |  |     | 1,473,750 |  |      |   | 1,456,190 |       | 
|Ivy Rehab, Senior Secured Initial
    Term Loan (First Lien), 9.34% (SOFR + 4.75%), maturity 4/23/29                                    |  | 3/11/2022         |  |     | 1,147,092 |  |      |   | 1,124,711 |       | 
|Solis Mammography, Senior Secured
    Initial Term Loan (First Lien), 9.52% (LIBOR + 4.75%), maturity 4/17/28                           |  | 4/1/2021          |  |     | 1,069,941 |  |      |   | 1,061,811 |       | 
|Tecomet, Senior Secured 2017 Term
    Loan (First Lien), 8.27% (LIBOR + 3.50%), maturity 5/1/24                                         |  | 1/10/2019         |  |     | 1,143,735 |  |      |   | 1,143,669 |       | 
|Solis Mammography, Senior Secured
    Initial Term Loan (Second Lien), 12.77% (LIBOR + 8.00%), maturity 4/16/29                         |  | 4/1/2021          |  |     | 1,000,000 |  |      |   | 987,505   |       | 
|Micro Merchant Systems, Unitranche
    Initial Term Loan, 10.34% (SOFR + 5.75%), maturity 12/14/27                                      |  | 3/2/2022          |  |     | 992,500   |  |      |   | 982,465   |       | 
|Wedgewood, Senior Secured Initial
    Term Loan, 9.02% (LIBOR + 4.25%), maturity 3/31/28                                                |  | 2/24/2021         |  |     | 987,500   |  |      |   | 979,070   |       | 
|nThrive, Senior Secured Initial
    Term Loan (First Lien), 8.77% (LIBOR + 4.00%), maturity 12/18/28                                    |  | 11/19/2021        |  |     | 992,500   |  |      |   | 988,500   |       | 
|Allied Benefit Systems, Senior
    Secured Initial Term B Loan, 9.27% (LIBOR + 4.50%), maturity 11/18/26                                |  | 10/21/2020        |  |     | 980,000   |  |      |   | 969,646   |       | 
|Forefront, Senior Secured Closing
    Date Term Loan, 8.84% (SOFR + 4.25%), maturity 4/1/29                                             |  | 3/23/2022         |  |     | 978,236   |  |      |   | 962,181   |       | 
|Epic Staffing Group, Senior Secured
    Initial Term Loan, 10.59% (SOFR + 6.00%), maturity 6/28/29                                      |  | 6/27/2022         |  |     | 821,454   |  |      |   | 763,696   |       | 
|UDG,
    Senior Secured Initial Dollar Term Loan (First Lien), 9.02% (LIBOR + 4.25%), maturity 8/19/28 (k)                              |  | 8/6/2021          |  |     | 631,875   |  |      |   | 626,966   |       | 
|ImageFirst, Senior Secured Initial
    Term Loan, 9.27% (LIBOR + 4.50%), maturity 4/27/28                                               |  | 4/26/2021         |  |     | 604,773   |  |      |   | 602,336   |       | 
|MyEyeDr, Senior Secured Initial
    Term Loan (First Lien), 9.02% (LIBOR + 4.25%), maturity 8/31/26                                     |  | 8/2/2019          |  |     | 521,312   |  |      |   | 518,666   |       | 
|Western Dental, Senior Secured
    2022 Incremental Term Loan, 10.02% (LIBOR + 5.25%), maturity 8/18/28                                 |  | 6/21/2022         |  |     | 497,500   |  |      |   | 488,274   |       | 
|AccentCare, Senior Secured 2021
    Term Loan (First Lien), 8.77% (LIBOR + 4.00%), maturity 6/22/26                                     |  | 6/15/2021         |  |     | 492,500   |  |      |   | 492,500   |       | 
|MedRisk,
    Senior Secured Initial Term Loan (First Lien), 8.52% (LIBOR + 3.75%), maturity 5/10/28 (j)                                 |  | 4/1/2021          |  |     | 493,750   |  |      |   | 489,558   |       | 
|RMP & MedA/Rx, Senior
    Secured Term Loan, 9.27% (LIBOR + 4.50%), maturity 2/6/25                                                     |  | 3/22/2021         |  |     | 465,625   |  |      |   | 462,043   |       | 
|Press
    Ganey, Senior Secured 2020 Incremental Term Loan (First Lien) Retired 05/25/2021, 8.52% (LIBOR + 3.75%), maturity 7/24/26 (j) |  | 10/1/2020         |  |     | 491,269   |  |      |   | 487,720   |       | 
|RMP & MedA/Rx, Senior
    Secured Term Loan (First Lien), 9.02% (LIBOR + 4.25%), maturity 2/6/25                                        |  | 2/27/2017         |  |     | 397,482   |  |      |   | 397,490   |       | 
|Blue Cloud, Senior Secured Revolving
    Loan, 9.59% (SOFR + 5.00%), maturity 1/21/28                                                   |  | 12/14/2022        |  |     | 50,000    |  |      |   | 50,000    |       | 
|CPS,
    Senior Secured Revolving Credit Loan, 10.52% (LIBOR + 5.75%), maturity 6/1/28 (i)                                              |  | 5/18/2022         |  |     | -         |  |      |   | (714      | )     | 
|Ivy Rehab, Senior Secured Revolving
    Credit Loan (First Lien), 9.34% (SOFR + 4.75%), maturity 4/21/28                                |  | 3/11/2022         |  |     | -         |  |      |   | (3,367    | )     | 
|InterMed,
    Senior Secured Revolving Loan, 11.09% (SOFR + 6.50%), maturity 12/24/28 (i) (j)                                           |  | 12/22/2022        |  |     | -         |  |      |   | (21,598   | )     | 
|                                                                                                                                        |  |                   |  |     |           |  |      |   |           |       | 
|Services: Business                                                                                                                      |  |                   |  |     |           |  |      |   |           |       | 
|LegalShield,
    Senior Secured Initial Term Loan (First Lien), 8.52% (LIBOR + 3.75%), maturity 12/15/28 (j)                            |  | 12/7/2021         |  |     | 4,466,250 |  |      |   | 4,426,965 |       | 
|InnovateMR,
    Unitranche Initial Term Loan, 10.27% (LIBOR + 5.50%), maturity 1/20/28 (i)                                              |  | 12/16/2021        |  |     | 4,200,101 |  |      |   | 4,134,245 |       | 
|CoAdvantage,
    Senior Secured Initial Term Loan (First Lien), 9.77% (LIBOR + 5.00%), maturity 9/23/25 (l)                             |  | 9/26/2019         |  |     | 3,870,000 |  |      |   | 3,849,940 |       | 
|RevSpring,
    Senior Secured Initial Term Loan (First Lien), 8.77% (LIBOR + 4.00%), maturity 10/11/25 (l)                              |  | 10/5/2018         |  |     | 3,840,000 |  |      |   | 3,837,742 |       | 
|Eliassen, Unitranche Initial Term
    Loan, 10.34% (SOFR + 5.75%), maturity 4/7/28                                                      |  | 3/31/2022         |  |     | 3,361,944 |  |      |   | 3,309,152 |       | 
|Veritext,
    Senior Secured Initial Term Loan (First Lien), 8.27% (LIBOR + 3.50%), maturity 8/1/25 (j)                                 |  | 8/14/2018         |  |     | 3,079,058 |  |      |   | 3,064,961 |       | 
|Discovery Education, Unitranche
    Initial Term Loan (First Lien), 10.34% (SOFR + 5.75%), maturity 4/6/29                              |  | 3/25/2022         |  |     | 2,992,500 |  |      |   | 2,945,651 |       | 
|Fleetwash, Senior Secured Incremental
    Term Loan, 9.34% (SOFR + 4.75%), maturity 10/1/24                                             |  | 9/25/2018         |  |     | 2,873,288 |  |      |   | 2,863,535 |       | 
|The Facilities Group, Unitranche
    Initial Term Loan, 10.52% (LIBOR + 5.75%), maturity 11/30/27                                       |  | 12/10/2021        |  |     | 2,726,358 |  |      |   | 2,700,991 |       | 
|Industrial
    Services Group, Unitranche First Lien Term Loan, 10.84% (SOFR + 6.25%), maturity 12/7/28 (i)                             |  | 12/7/2022         |  |     | 2,761,905 |  |      |   | 2,657,619 |       | 
|CoolSys, Senior Secured Closing
    Date Initial Term Loan, 9.52% (LIBOR + 4.75%), maturity 8/11/28                                     |  | 8/4/2021          |  |     | 2,564,375 |  |      |   | 2,538,048 |       | 
|Service Logic, Senior Secured
    Closing Date Initial Term Loan (First Lien), 8.77% (LIBOR + 4.00%), maturity 10/29/27                 |  | 10/23/2020        |  |     | 2,535,569 |  |      |   | 2,516,126 |       | 
|Duff &
    Phelps, Senior Secured Initial Dollar Term Loan (First Lien), 8.34% (SOFR + 3.75%), maturity 4/9/27 (j)                      |  | 3/6/2020          |  |     | 2,437,500 |  |      |   | 2,422,596 |       | 
|TRC Companies, Senior Secured
    Initial Term Loan (Second Lien), 11.52% (LIBOR + 6.75%), maturity 12/7/29                             |  | 11/19/2021        |  |     | 2,000,000 |  |      |   | 1,980,000 |       | 
|Liberty
    Group, Unitranche Initial Term Loan, 10.34% (SOFR + 5.75%), maturity 6/9/28 (i)                                             |  | 6/6/2022          |  |     | 1,945,114 |  |      |   | 1,906,873 |       | 
|Veregy, Senior Secured Initial
    Term Loan, 10.77% (LIBOR + 6.00%), maturity 11/3/27                                                  |  | 11/2/2020         |  |     | 1,960,000 |  |      |   | 1,916,318 |       | 
|InnovateMR,
    Senior Secured First Amendment Term Loan, 10.09% (SOFR + 5.50%), maturity 1/20/28 (i)                                   |  | 12/23/2022        |  |     | 1,891,019 |  |      |   | 1,832,654 |       | 
|ECi
    Software, Senior Secured Initial Term Loan (First Lien), 8.52% (LIBOR + 3.75%), maturity 11/9/27 (j)                            |  | 9/17/2020         |  |     | 1,960,000 |  |      |   | 1,953,585 |       | 
|Mediaocean,
    Senior Secured Initial Term Loan, 8.27% (LIBOR + 3.50%), maturity 12/15/28 (j)                                          |  | 12/9/2021         |  |     | 1,985,000 |  |      |   | 1,967,596 |       | 
|Insight Global, Unitranche Closing
    Date Term Loan, 10.77% (LIBOR + 6.00%), maturity 9/22/28                                         |  | 9/22/2021         |  |     | 1,481,250 |  |      |   | 1,454,671 |       | 
|Addison Group, Senior Secured
    Initial Term Loan, 8.84% (SOFR + 4.25%), maturity 12/29/28                                            |  | 1/19/2022         |  |     | 1,488,750 |  |      |   | 1,485,425 |       | 





78







Audax Credit BDC Inc.

Schedules of Investments (Continued)

As of December 31, 2021

(Expressed in U.S. Dollars)



|Portfolio
    Investments (a) (b) (c) (d) (e) (f)                                                                                  |  | Acquisition
 Date |  | Par |           |  | Cost |   |           | Value | 
|---------------------------------------------------------------------------------------------------------------------------------- |  | ----------------- |  | --- | --------- |  | ---- | - | --------- | ----- | 
|BANK
    LOANS: NON-CONTROL/NON-AFFILIATE INVESTMENTS(h)(Continued):                                                               |  |                   |  |     |           |  |      |   |           |       | 
|                                                                                                                                   |  |                   |  |     |           |  |      |   |           |       | 
|Services:
    Business (continued)                                                                                                 |  |                   |  |     |           |  |      |   |           |       | 
|OSG
    Billing Services, Senior Secured Amended and Restated Term A Loan, 10.09% (SOFR + 5.50%) 1.50% PIK, maturity 6/26/26       |  | 8/31/2022         |  | $   | 1,442,041 |  |      | $ | 1,440,308 |       | 
|First
    Advantage, Senior Secured Term B-1 Loan (First Lien), 7.52% (LIBOR + 2.75%), maturity 1/31/27 (j)                        |  | 1/23/2020         |  |     | 1,100,312 |  |      |   | 1,091,680 |       | 
|Veritext,
    Senior Secured Initial Term Loan (Second Lien), 11.52% (LIBOR + 6.75%), maturity 7/31/26 (j)                         |  | 8/14/2018         |  |     | 1,000,000 |  |      |   | 997,283   |       | 
|Vistage,
    Senior Secured Initial Term Loan, 9.84% (SOFR + 5.25%), maturity 7/13/29                                              |  | 7/18/2022         |  |     | 997,500   |  |      |   | 971,265   |       | 
|trustaff,
    Senior Secured Initial Term Loan (First Lien), 8.52% (LIBOR + 3.75%), maturity 3/6/28                                |  | 12/9/2021         |  |     | 987,437   |  |      |   | 985,293   |       | 
|TRC
    Companies, Senior Secured Initial Term Loan (First Lien), 8.52% (LIBOR + 3.75%), maturity 12/8/28                          |  | 11/19/2021        |  |     | 992,513   |  |      |   | 988,187   |       | 
|Divisions
    Maintenance Group, Senior Secured Term B Loan, 9.52% (LIBOR + 4.75%), maturity 5/27/28                               |  | 5/21/2021         |  |     | 987,500   |  |      |   | 979,366   |       | 
|Secretariat
    International, Senior Secured Initial Term Loan (First Lien), 9.52% (LIBOR + 4.75%), maturity 12/29/28             |  | 12/16/2021        |  |     | 975,711   |  |      |   | 971,287   |       | 
|WIRB-Copernicus
    Group, Senior Secured Initial Term Loan (First Lien), 8.77% (LIBOR + 4.00%), maturity 1/8/27                   |  | 12/13/2019        |  |     | 975,000   |  |      |   | 968,894   |       | 
|Diversified,
    Senior Secured Initial Term Loan, 9.59% (SOFR + 5.00%), maturity 12/23/23                                         |  | 4/19/2019         |  |     | 899,347   |  |      |   | 897,624   |       | 
|eResearch,
    Senior Secured Initial Term Loan (First Lien), 9.27% (LIBOR + 4.50%), maturity 2/4/27 (j)                           |  | 12/1/2020         |  |     | 979,906   |  |      |   | 979,906   |       | 
|VC3,
    Unitranche, 9.84% (SOFR + 5.25%), maturity 3/12/27 (i)                                                                    |  | 9/16/2022         |  |     | 742,423   |  |      |   | 694,346   |       | 
|Therma
    Holdings, Senior Secured Initial Term Loan (2021), 8.52% (LIBOR + 3.75%), maturity 12/16/27 (j)                         |  | 12/11/2020        |  |     | 590,428   |  |      |   | 588,526   |       | 
|System
    One, Senior Secured Initial Term Loan, 8.59% (SOFR + 4.00%), maturity 3/2/28                                            |  | 1/28/2021         |  |     | 492,500   |  |      |   | 490,627   |       | 
|Insight
    Global, Senior Secured Revolving Loan, 10.77% (LIBOR + 6.00%), maturity 9/22/27                                        |  | 9/23/2021         |  |     | 53,671    |  |      |   | 53,671    |       | 
|VC3,
    Senior Secured Revolving Credit, 9.84% (SOFR + 5.25%), maturity 3/12/27 (i)                                               |  | 7/21/2022         |  |     | -         |  |      |   | (2,692    | )     | 
|Discovery
    Education, Senior Secured Revolving Credit Loan (First Lien), 10.34% (SOFR + 5.75%), maturity 4/7/28                 |  | 3/25/2022         |  |     | -         |  |      |   | (4,038    | )     | 
|Liberty
    Group, Senior Secured Revolving Loan, 10.34% (SOFR + 5.75%), maturity 6/9/28 (i)                                       |  | 6/6/2022          |  |     | -         |  |      |   | (4,545    | )     | 
|Industrial
    Services Group, Senior Secured Revolver, 10.84% (SOFR + 6.25%), maturity 12/7/28 (i)                                |  | 12/7/2022         |  |     | -         |  |      |   | (17,143   | )     | 
|                                                                                                                                   |  |                   |  |     |           |  |      |   |           |       | 
|High
    Tech Industries                                                                                                           |  |                   |  |     |           |  |      |   |           |       | 
|Qlik,
    Senior Secured 2021 Refinancing Term Loan, 8.77% (LIBOR + 4.00%), maturity 4/26/24 (j) (l)                               |  | 3/29/2019         |  |     | 3,861,200 |  |      |   | 3,852,597 |       | 
|Golden
    Source, Unitranche Initial Term Loan, 10.09% (SOFR + 5.50%), maturity 5/12/28 (i)                                       |  | 3/25/2022         |  |     | 3,454,402 |  |      |   | 3,380,910 |       | 
|Netsmart,
    Senior Secured Initial Term Loan (First Lien), 8.77% (LIBOR + 4.00%), maturity 10/1/27 (j)                           |  | 9/29/2020         |  |     | 3,438,750 |  |      |   | 3,427,753 |       | 
|Jaggaer,
    Senior Secured Initial Term Loan (First Lien), 8.34% (SOFR + 3.75%), maturity 8/14/26 (j)                             |  | 8/9/2019          |  |     | 3,059,478 |  |      |   | 3,056,395 |       | 
|Infogroup,
    Senior Secured Term Loan (First Lien), 9.77% (LIBOR + 5.00%), maturity 4/3/23 (j)                                   |  | 3/28/2017         |  |     | 2,829,862 |  |      |   | 2,826,938 |       | 
|Planview,
    Senior Secured Closing Date Term Loan (First Lien), 8.77% (LIBOR + 4.00%), maturity 12/17/27                         |  | 12/11/2020        |  |     | 2,605,701 |  |      |   | 2,583,676 |       | 
|Idera,
    Senior Secured Term B-1 Loan (First Lien), 8.52% (LIBOR + 3.75%), maturity 3/2/28 (j)                                   |  | 6/27/2017         |  |     | 2,573,127 |  |      |   | 2,573,136 |       | 
|Ivanti
    Software, Senior Secured 2021 Specified Refinancing Term Loan (First Lien), 9.02% (LIBOR + 4.25%), maturity 12/1/27 (j) |  | 11/20/2020        |  |     | 2,962,613 |  |      |   | 2,931,550 |       | 
|PracticeTek,
    Unitranche Initial Term Loan, 11.02% (LIBOR + 6.25%), maturity 11/23/27 (i)                                       |  | 11/22/2021        |  |     | 2,382,968 |  |      |   | 2,329,122 |       | 
|Precisely,
    Senior Secured Third Amendment Term Loan (First Lien), 8.77% (LIBOR + 4.00%), maturity 4/24/28                      |  | 3/19/2021         |  |     | 2,468,750 |  |      |   | 2,457,445 |       | 
|Flexera,
    Senior Secured Term B-1 Loan (First Lien), 8.52% (LIBOR + 3.75%), maturity 3/3/28 (j)                                 |  | 2/16/2020         |  |     | 2,358,160 |  |      |   | 2,358,160 |       | 
|Barracuda,
    Senior Secured Initial Term Loan (Second Lien), 11.59% (SOFR + 7.00%), maturity 5/31/30                             |  | 5/17/2022         |  |     | 2,000,000 |  |      |   | 1,940,000 |       | 
|QuickBase,
    Senior Secured Term Loan (First Lien), 8.77% (LIBOR + 4.00%), maturity 4/2/26                                       |  | 3/29/2019         |  |     | 1,930,000 |  |      |   | 1,925,451 |       | 
|Sophos,
    Senior Secured Dollar Tranche Term Loan (First Lien), 8.27% (LIBOR + 3.50%), maturity 3/5/27 (j) (n)                   |  | 1/16/2020         |  |     | 1,950,024 |  |      |   | 1,877,853 |       | 
|Intermedia,
    Senior Secured New Term Loan (First Lien), 10.77% (LIBOR + 6.00%), maturity 7/21/25                                |  | 7/13/2018         |  |     | 1,920,000 |  |      |   | 1,913,976 |       | 
|HelpSystems,
    Senior Secured Term Loan, 8.59% (SOFR + 4.00%), maturity 11/19/26                                                 |  | 12/19/2019        |  |     | 1,969,727 |  |      |   | 1,963,923 |       | 
|Bomgar,
    Senior Secured Initial Term Loan (First Lien), 8.77% (LIBOR + 4.00%), maturity 4/18/25                                 |  | 5/25/2018         |  |     | 1,610,595 |  |      |   | 1,615,029 |       | 
|OEConnection,
    Senior Secured Initial Term Loan, 8.77% (LIBOR + 4.00%), maturity 9/25/26                                        |  | 9/24/2019         |  |     | 1,592,260 |  |      |   | 1,588,315 |       | 
|Digital
    Room, Senior Secured Closing Date Term Loan (First Lien), 10.02% (LIBOR + 5.25%), maturity 12/21/28                    |  | 12/16/2021        |  |     | 1,488,750 |  |      |   | 1,475,605 |       | 
|SmartBear,
    Senior Secured Initial Term Loan (First Lien), 9.02% (LIBOR + 4.25%), maturity 3/3/28                               |  | 11/20/2020        |  |     | 985,000   |  |      |   | 976,981   |       | 
|WellSky,
    Senior Secured Incremental Term B-1 Loan (First Lien), 10.34% (SOFR + 5.75%), maturity 3/10/28                        |  | 8/16/2022         |  |     | 997,500   |  |      |   | 968,858   |       | 
|ORBCOMM,
    Senior Secured Closing Date Term Loan (First Lien), 9.02% (LIBOR + 4.25%), maturity 9/1/28                            |  | 6/17/2021         |  |     | 987,500   |  |      |   | 983,149   |       | 
|Imperva,
    Senior Secured Term Loan, 8.77% (LIBOR + 4.00%), maturity 1/12/26                                                     |  | 9/23/2020         |  |     | 975,981   |  |      |   | 970,223   |       | 
|Infoblox,
    Senior Secured Initial Term Loan (First Lien), 8.34% (SOFR + 3.75%), maturity 12/1/27 (j)                            |  | 10/7/2020         |  |     | 985,000   |  |      |   | 981,549   |       | 
|Cloudera,
    Senior Secured Initial Term Loan (First Lien), 8.52% (LIBOR + 3.75%), maturity 10/8/28                               |  | 8/10/2021         |  |     | 496,250   |  |      |   | 491,967   |       | 
|Barracuda,
    Senior Secured Initial Term Loan (First Lien), 9.09% (SOFR + 4.50%), maturity 5/31/29 (j)                           |  | 5/17/2022         |  |     | 500,000   |  |      |   | 485,490   |       | 
|DigiCert,
    Senior Secured Initial Term Loan (First Lien), 8.59% (SOFR + 4.00%), maturity 10/16/26 (j)                           |  | 3/13/2020         |  |     | 486,250   |  |      |   | 469,111   |       | 
|PracticeTek,
    Senior Secured Revolving Loan, 11.02% (LIBOR + 6.25%), maturity 11/23/27 (i)                                      |  | 11/22/2021        |  |     | -         |  |      |   | (7,156    | )     | 
|Golden
    Source, Senior Secured Revolving Loan, 10.09% (SOFR + 5.50%), maturity 5/12/28 (i)                                      |  | 8/22/2022         |  |     | -         |  |      |   | (9,390    | )     | 
|                                                                                                                                   |  |                   |  |     |           |  |      |   |           |       | 
|Containers,
    Packaging & Glass                                                                                                  |  |                   |  |     |           |  |      |   |           |       | 
|InMark,
    Unitranche Incremental Term Loan, 10.59% (SOFR + 6.00%), maturity 12/23/26 (i)                                         |  | 12/10/2021        |  |     | 6,419,952 |  |      |   | 6,305,403 |       | 
|Transcendia,
    Senior Secured 2017 Refinancing Term Loan (First Lien), 8.27% (LIBOR + 3.50%), maturity 5/30/24                   |  | 5/11/2017         |  |     | 3,318,093 |  |      |   | 3,313,837 |       | 
|Brook &
    Whittle, Senior Secured Initial Term Loan (First Lien), 8.59% (SOFR + 4.00%), maturity 12/14/28                        |  | 12/9/2021         |  |     | 3,131,265 |  |      |   | 3,107,930 |       | 
|Anchor
    Packaging, Senior Secured Initial Term Loan (First Lien), 8.77% (LIBOR + 4.00%), maturity 7/18/26                       |  | 7/17/2019         |  |     | 2,490,744 |  |      |   | 2,482,832 |       | 
|PCI,
    Senior Secured Term B Loan (First Lien), 8.27% (LIBOR + 3.50%), maturity 11/30/27 (j)                                     |  | 9/25/2020         |  |     | 2,443,938 |  |      |   | 2,436,928 |       | 
|Paragon
    Films, Senior Secured Closing Date Term Loan (First Lien), 9.77% (LIBOR + 5.00%), maturity 12/16/28                    |  | 12/15/2021        |  |     | 1,985,000 |  |      |   | 1,966,087 |       | 
|Intertape
    Polymer, Senior Secured Initial Term Loan (First Lien), 9.34% (SOFR + 4.75%), maturity 6/28/28 (o)                   |  | 6/15/2022         |  |     | 1,995,000 |  |      |   | 1,921,340 |       | 
|Resource
    Label Group, Senior Secured Closing Date Initial Term Loan (First Lien), 8.77% (LIBOR + 4.00%), maturity 7/7/28       |  | 7/2/2021          |  |     | 1,860,949 |  |      |   | 1,852,924 |       | 
|TricorBraun,
    Senior Secured Closing Date Initial Term Loan (First Lien), 8.02% (LIBOR + 3.25%), maturity 3/3/28 (j)            |  | 1/29/2021         |  |     | 1,810,382 |  |      |   | 1,802,881 |       | 
|Potters
    Industries, Senior Secured Initial Term Loan, 8.77% (LIBOR + 4.00%), maturity 12/14/27                                 |  | 11/19/2020        |  |     | 1,473,750 |  |      |   | 1,463,413 |       | 
|Technimark,
    Senior Secured Initial Term Loan (First Lien), 8.52% (LIBOR + 3.75%), maturity 7/7/28                              |  | 6/30/2021         |  |     | 1,477,500 |  |      |   | 1,471,343 |       | 
|Tekni-Plex,
    Senior Secured Tranche B-3 Initial Term Loan, 8.77% (LIBOR + 4.00%), maturity 9/15/28 (j)                          |  | 7/29/2021         |  |     | 1,128,183 |  |      |   | 1,125,889 |       | 
|Lacerta,
    Senior Secured Term Loan, 10.27% (LIBOR + 5.50%), maturity 12/30/26                                                   |  | 2/8/2021          |  |     | 980,000   |  |      |   | 971,686   |       | 
|Novolex,
    Senior Secured Term B Loan (First Lien), 8.84% (SOFR + 4.25%), maturity 4/13/29 (j)                                   |  | 3/30/2022         |  |     | 995,000   |  |      |   | 972,844   |       | 
|Pregis,
    Senior Secured Initial Term Loan (First Lien), 8.34% (SOFR + 3.75%), maturity 7/31/26 (j)                              |  | 7/25/2019         |  |     | 970,000   |  |      |   | 968,670   |       | 
|Applied
    Adhesives, Senior Secured Term A Loan, 9.52% (LIBOR + 4.75%), maturity 3/12/27                                         |  | 3/12/2021         |  |     | 593,430   |  |      |   | 588,737   |       | 
|Five
    Star Packaging, Senior Secured Initial Term Loan (First Lien), 8.84% (SOFR + 4.25%), maturity 5/5/29                      |  | 4/27/2022         |  |     | 498,750   |  |      |   | 491,854   |       | 
|Pregis,
    Senior Secured Third Amendment Refinancing Term Loan (First Lien), 8.52% (LIBOR + 3.75%), maturity 7/31/26             |  | 12/9/2020         |  |     | 493,750   |  |      |   | 492,024   |       | 
|Golden
    West Packaging, Senior Secured Initial Term Loan, 10.02% (LIBOR + 5.25%), maturity 12/1/27                              |  | 11/29/2021        |  |     | 490,625   |  |      |   | 486,330   |       | 
|Applied
    Adhesives, Senior Secured Revolving Loan, 9.52% (LIBOR + 4.75%), maturity 3/12/27                                      |  | 3/12/2021         |  |     | -         |  |      |   | (616      | )     | 





79







Audax Credit BDC Inc.

Schedules of Investments (Continued)

As of December 31, 2021

(Expressed in U.S. Dollars)



|Portfolio
    Investments (a) (b) (c) (d) (e) (f)                                                                                 |  | Acquisition
 Date |  | Par |           |  | Cost |   |           | Value | 
|--------------------------------------------------------------------------------------------------------------------------------- |  | ----------------- |  | --- | --------- |  | ---- | - | --------- | ----- | 
|BANK
    LOANS: NON-CONTROL/NON-AFFILIATE INVESTMENTS(h) (Continued):                                                             |  |                   |  |     |           |  |      |   |           |       | 
|                                                                                                                                  |  |                   |  |     |           |  |      |   |           |       | 
|Banking,
    Finance, Insurance & Real Estate                                                                                     |  |                   |  |     |           |  |      |   |           |       | 
|Cerity
    Partners, Senior Secured Initial Term Loan, 10.34% (SOFR + 5.75%), maturity 7/27/29 (i)                                |  | 7/28/2022         |  | $   | 4,647,849 |  |      | $ | 4,574,823 |       | 
|Confluence,
    Senior Secured Initial Term Loan (First Lien), 8.34% (SOFR + 3.75%), maturity 7/31/28                             |  | 7/22/2021         |  |     | 3,960,000 |  |      |   | 3,941,319 |       | 
|Cherry
    Bekaert, Unitranche Term B Loan, 10.09% (SOFR + 5.50%), maturity 6/30/28 (i)                                           |  | 6/13/2022         |  |     | 3,550,571 |  |      |   | 3,464,800 |       | 
|Ascensus,
    Senior Secured Initial Term Loan (First Lien), 8.27% (LIBOR + 3.50%), maturity 8/2/28                               |  | 11/17/2021        |  |     | 2,977,500 |  |      |   | 2,965,493 |       | 
|Alera,
    Unitranche 2022 Incremental Term Loan, 11.09% (SOFR + 6.50%), maturity 9/30/28                                         |  | 8/31/2022         |  |     | 2,819,600 |  |      |   | 2,740,779 |       | 
|EPIC
    Insurance, Unitranche Closing Date Term Loan, 10.02% (LIBOR + 5.25%), maturity 9/29/28                                   |  | 8/27/2021         |  |     | 2,371,834 |  |      |   | 2,338,982 |       | 
|American
    Beacon Advisors, Senior Secured Tranche D Term Loan (Second Lien), 12.77% (LIBOR + 8.00%), maturity 4/30/25          |  | 10/31/2017        |  |     | 2,117,133 |  |      |   | 2,121,970 |       | 
|Beta+,
    Senior Secured Initial Term Loan, 9.84% (SOFR + 5.25%), maturity 7/1/29                                                |  | 6/24/2022         |  |     | 1,995,000 |  |      |   | 1,956,752 |       | 
|Kestra
    Financial, Senior Secured Initial Term Loan, 8.84% (SOFR + 4.25%), maturity 6/3/26                                     |  | 4/29/2019         |  |     | 1,935,000 |  |      |   | 1,924,606 |       | 
|Orion,
    Senior Secured 2021 Refinancing Term Loan (First Lien), 8.52% (LIBOR + 3.75%), maturity 9/24/27                        |  | 8/4/2020          |  |     | 1,470,065 |  |      |   | 1,458,041 |       | 
|SIAA,
    Unitranche Initial Term Loan, 11.02% (LIBOR + 6.25%), maturity 4/28/28                                                  |  | 4/21/2021         |  |     | 1,160,762 |  |      |   | 1,142,944 |       | 
|Advisor
    Group, Senior Secured Term B-1 Loan, 9.27% (LIBOR + 4.50%), maturity 7/31/26 (j)                                      |  | 1/31/2020         |  |     | 1,018,929 |  |      |   | 1,018,969 |       | 
|Community
    Brands, Senior Secured Initial Term Loan, 10.34% (SOFR + 5.75%), maturity 2/24/28                                   |  | 2/23/2022         |  |     | 992,500   |  |      |   | 972,300   |       | 
|LERETA,
    Senior Secured Initial Term Loan, 10.02% (LIBOR + 5.25%), maturity 7/30/28                                            |  | 7/27/2021         |  |     | 987,500   |  |      |   | 978,810   |       | 
|Sedgwick
    Claims, Senior Secured Initial Term Loan, 8.02% (LIBOR + 3.25%), maturity 12/31/25 (j)                               |  | 2/12/2020         |  |     | 484,848   |  |      |   | 484,476   |       | 
|EdgeCo,
    Senior Secured Third Amendment Term Loan (First Lien), 9.52% (LIBOR + 4.75%), maturity 6/1/26                         |  | 3/29/2022         |  |     | 297,750   |  |      |   | 275,745   |       | 
|Integro,
    Senior Secured 2022 Refinancing Term Loan (First Lien), 12.25% (Fixed) 12.25% PIK, maturity 5/8/23 (n)               |  | 10/9/2015         |  |     | 228,698   |  |      |   | 232,323   |       | 
|Cherry
    Bekaert, Senior Secured Revolving Credit Loan, 10.09% (SOFR + 5.50%), maturity 6/30/28 (i)                             |  | 8/1/2022          |  |     | 184,942   |  |      |   | 184,942   |       | 
|EPIC
    Insurance, Senior Secured Revolving Loan, 10.02% (LIBOR + 5.25%), maturity 9/30/27                                       |  | 8/27/2021         |  |     | -         |  |      |   | (269      | )     | 
|Beta+,
    Senior Secured Revolving Credit Loan, 9.84% (SOFR + 5.25%), maturity 7/1/27                                            |  | 6/24/2022         |  |     | -         |  |      |   | (6,216    | )     | 
|                                                                                                                                  |  |                   |  |     |           |  |      |   |           |       | 
|Capital
    Equipment                                                                                                             |  |                   |  |     |           |  |      |   |           |       | 
|FloWorks,
    Senior Secured Initial Term Loan (First Lien), 10.34% (SOFR + 5.75%), maturity 12/27/28 (j)                         |  | 3/1/2022          |  |     | 3,980,000 |  |      |   | 3,856,250 |       | 
|Tank
    Holding, Unitranche Initial Term Loan, 10.59% (SOFR + 6.00%), maturity 3/31/28 (m)                                       |  | 3/25/2022         |  |     | 3,980,000 |  |      |   | 3,907,511 |       | 
|Plaskolite,
    Senior Secured 2021-1 Refinancing Term Loan (First Lien), 8.77% (LIBOR + 4.00%), maturity 12/15/25                |  | 12/12/2018        |  |     | 3,841,575 |  |      |   | 3,807,287 |       | 
|Excelitas,
    Senior Secured Closing Date Euro Term Loan, 10.52% (Other + 5.75%), maturity 8/12/29                               |  | 6/15/2022         |  |     | 2,969,565 |  |      |   | 3,013,358 |       | 
|Burke
    Porter Group, Unitranche Closing Date Term Loan, 10.59% (SOFR + 6.00%), maturity 7/29/29 (i)                            |  | 9/30/2022         |  |     | 2,333,333 |  |      |   | 2,271,028 |       | 
|MW
    Industries, Senior Secured 2018 New Term Loan (First Lien), 8.52% (LIBOR + 3.75%), maturity 9/30/24 (j)                    |  | 4/20/2018         |  |     | 2,037,048 |  |      |   | 2,037,048 |       | 
|Flow
    Control Group, Senior Secured Initial Term Loan (First Lien), 8.52% (LIBOR + 3.75%), maturity 3/31/28 (j)                |  | 3/17/2021         |  |     | 1,666,204 |  |      |   | 1,663,888 |       | 
|Radwell,
    Unitranche Initial Term Loan, 10.34% (SOFR + 5.75%), maturity 4/1/29                                                 |  | 3/11/2022         |  |     | 1,492,500 |  |      |   | 1,469,422 |       | 
|Edward
    Don, Senior Secured Initial Term Loan, 9.02% (LIBOR + 4.25%), maturity 7/2/25                                          |  | 6/26/2018         |  |     | 1,370,943 |  |      |   | 1,369,445 |       | 
|Therm-O-Disc,
    Senior Secured Initial Term Loan (First Lien), 10.59% (SOFR + 6.00%), maturity 5/31/29                          |  | 5/26/2022         |  |     | 997,500   |  |      |   | 923,600   |       | 
|Cleaver
    Brooks, Senior Secured Initial Term Loan, 10.34% (SOFR + 5.75%), maturity 7/31/28                                     |  | 7/18/2022         |  |     | 993,750   |  |      |   | 974,648   |       | 
|TriMark,
    Senior Secured Second Amendment Tranche B Loan (Super Senior Priority), 8.27% (LIBOR + 3.50%), maturity 8/28/24      |  | 1/31/2022         |  |     | 963,589   |  |      |   | 963,589   |       | 
|Culligan,
    Senior Secured 2022 Refinancing Term B Loan, 8.52% (LIBOR + 3.75%), maturity 7/31/28 (j)                            |  | 6/17/2021         |  |     | 559,688   |  |      |   | 556,920   |       | 
|Infinite
    Electronics, Senior Secured Initial Term Loan (First Lien), 8.02% (LIBOR + 3.25%), maturity 3/2/28                   |  | 2/24/2021         |  |     | 492,500   |  |      |   | 491,568   |       | 
|Duravant,
    Senior Secured Incremental Amendment No. 5 Term Loan (First Lien), 8.52% (LIBOR + 3.75%), maturity 5/19/28 (j)      |  | 3/5/2020          |  |     | 487,500   |  |      |   | 487,500   |       | 
|SPX
    Flow, Senior Secured Term Loan, 9.09% (SOFR + 4.50%), maturity 4/5/29 (j)                                                 |  | 3/18/2022         |  |     | 498,750   |  |      |   | 478,053   |       | 
|Burke
    Porter Group, Senior Secured Revolving Credit Loan, 10.59% (SOFR + 6.00%), maturity 7/29/28 (i)                         |  | 8/11/2022         |  |     | 54,991    |  |      |   | 44,586    |       | 
|Tank
    Holding, Senior Secured Revolving Credit Loan, 10.59% (SOFR + 6.00%), maturity 3/31/28                                   |  | 3/25/2022         |  |     | 24,615    |  |      |   | 21,662    |       | 
|Cleaver
    Brooks, Senior Secured Revolving Loan, 10.34% (SOFR + 5.75%), maturity 7/31/28                                        |  | 7/21/2022         |  |     | 15,385    |  |      |   | 12,923    |       | 
|Radwell,
    Senior Secured Revolving Loan, 10.34% (SOFR + 5.75%), maturity 4/1/28                                                |  | 3/11/2022         |  |     | -         |  |      |   | (1,200    | )     | 
|                                                                                                                                  |  |                   |  |     |           |  |      |   |           |       | 
|Aerospace &
    Defense                                                                                                           |  |                   |  |     |           |  |      |   |           |       | 
|HDT
    Global, Senior Secured Initial Term Loan, 10.52% (LIBOR + 5.75%), maturity 7/8/27                                         |  | 6/30/2021         |  |     | 3,237,500 |  |      |   | 3,146,132 |       | 
|StandardAero,
    Senior Secured 2020 Term B-1 Loan, 8.27% (LIBOR + 3.50%), maturity 4/6/26 (j)                                   |  | 1/24/2019         |  |     | 3,237,691 |  |      |   | 3,233,062 |       | 
|CPI
    International, Senior Secured Initial Term Loan, 10.09% (SOFR + 5.50%), maturity 10/6/29                                  |  | 5/18/2022         |  |     | 3,000,000 |  |      |   | 2,933,703 |       | 
|Amentum,
    Senior Secured Tranche 3 Term Loan (First Lien), 8.59% (SOFR + 4.00%), maturity 2/15/29                              |  | 2/10/2022         |  |     | 1,990,000 |  |      |   | 1,980,482 |       | 
|Consolidated
    Precision Products, Senior Secured Initial Term Loan (Second Lien), 12.52% (LIBOR + 7.75%), maturity 4/30/26     |  | 5/10/2018         |  |     | 2,000,000 |  |      |   | 2,005,563 |       | 
|Whitcraft,
    Unitranche Initial Term Loan, 10.77% (LIBOR + 6.00%), maturity 4/3/23                                              |  | 3/6/2020          |  |     | 1,942,344 |  |      |   | 1,936,382 |       | 
|StandardAero,
    Senior Secured 2020 Term B-2 Loan, 8.27% (LIBOR + 3.50%), maturity 4/6/26 (j)                                   |  | 1/24/2019         |  |     | 1,740,694 |  |      |   | 1,738,206 |       | 
|Tronair,
    Senior Secured Initial Term Loan (First Lien), 10.52% (LIBOR + 5.75%) PIK, maturity 9/8/23                           |  | 9/30/2016         |  |     | 1,344,845 |  |      |   | 1,343,776 |       | 
|Peraton,
    Senior Secured Term B Loan (First Lien), 8.52% (LIBOR + 3.75%), maturity 2/1/28 (j)                                  |  | 2/23/2021         |  |     | 964,612   |  |      |   | 960,887   |       | 
|API
    Technologies, Senior Secured Initial Term Loan (First Lien), 9.02% (LIBOR + 4.25%), maturity 5/9/26                       |  | 1/15/2020         |  |     | 969,849   |  |      |   | 951,105   |       | 
|BlueHalo,
    Unitranche Initial Term Loan, 10.77% (LIBOR + 6.00%), maturity 10/31/25                                             |  | 11/17/2021        |  |     | 494,014   |  |      |   | 487,514   |       | 
|Novaria
    Group, Senior Secured Initial Term Loan, 10.09% (SOFR + 5.50%), maturity 1/27/27                                      |  | 1/24/2020         |  |     | 481,818   |  |      |   | 478,783   |       | 
|Consolidated
    Precision Products, Senior Secured Initial Term Loan (First Lien), 8.52% (LIBOR + 3.75%), maturity 4/30/25       |  | 7/18/2019         |  |     | 483,082   |  |      |   | 481,741   |       | 
|BlueHalo,
    Senior Secured Revolving Loan, 10.77% (LIBOR + 6.00%), maturity 10/31/25                                            |  | 11/17/2021        |  |     | 91,486    |  |      |   | 89,997    |       | 
|                                                                                                                                  |  |                   |  |     |           |  |      |   |           |       | 
|Chemicals,
    Plastics & Rubber                                                                                                  |  |                   |  |     |           |  |      |   |           |       | 
|DuBois
    Chemicals, Senior Secured Term Loan (Second Lien) - 2019, 13.27% (LIBOR + 8.50%), maturity 9/30/27                     |  | 10/8/2019         |  |     | 3,000,000 |  |      |   | 2,981,878 |       | 
|Vertellus,
    Senior Secured Initial Term Loan, 10.34% (SOFR + 5.75%), maturity 12/22/27                                         |  | 12/18/2020        |  |     | 2,962,613 |  |      |   | 2,902,499 |       | 
|Spectrum
    Plastics, Senior Secured Closing Date Term Loan (First Lien), 8.02% (LIBOR + 3.25%), maturity 1/31/25                |  | 1/26/2018         |  |     | 2,600,325 |  |      |   | 2,604,902 |       | 
|Unifrax,
    Senior Secured USD Term Loan (First Lien), 8.52% (LIBOR + 3.75%), maturity 12/12/25 (j)                              |  | 11/5/2018         |  |     | 2,401,203 |  |      |   | 2,382,882 |       | 
|Boyd
    Corp, Senior Secured Initial Loan (Second Lien), 11.52% (LIBOR + 6.75%), maturity 9/6/26                                 |  | 8/16/2018         |  |     | 2,000,000 |  |      |   | 2,001,368 |       | 
|USALCO,
    Unitranche Term Loan A, 10.77% (LIBOR + 6.00%), maturity 10/19/27                                                     |  | 10/26/2021        |  |     | 1,980,000 |  |      |   | 1,962,805 |       | 
|DuBois
    Chemicals, Senior Secured Term Loan B (First Lien), 9.27% (LIBOR + 4.50%), maturity 9/30/26                            |  | 10/8/2019         |  |     | 1,759,343 |  |      |   | 1,734,161 |       | 
|Vantage
    Specialty Chemicals, Senior Secured Closing Date Term Loan (First Lien), 8.27% (LIBOR + 3.50%), maturity 10/28/24 (j) |  | 11/30/2018        |  |     | 957,179   |  |      |   | 950,212   |       | 
|Ascensus
    Specialties, Senior Secured Initial Term Loan, 9.02% (LIBOR + 4.25%), maturity 6/30/28                               |  | 12/3/2021         |  |     | 493,722   |  |      |   | 485,722   |       | 
|Boyd
    Corp, Senior Secured Initial Term Loan (First Lien), 8.27% (LIBOR + 3.50%), maturity 9/6/25                              |  | 11/7/2018         |  |     | 487,277   |  |      |   | 469,149   |       | 
|Polytek,
    Senior Secured Term Loan, 10.34% (SOFR + 5.75%), maturity 9/20/24                                                    |  | 12/23/2020        |  |     | 490,119   |  |      |   | 485,649   |       | 
|USALCO,
    Senior Secured Revolving Loan, 10.77% (LIBOR + 6.00%), maturity 10/19/26                                              |  | 10/26/2021        |  |     | 137,097   |  |      |   | 133,871   |       | 
|Vertellus,
    Senior Secured Revolving Credit Loan, 10.34% (SOFR + 5.75%), maturity 12/22/25                                     |  | 12/18/2020        |  |     | -         |  |      |   | (10,130   | )     | 





80







Audax Credit BDC Inc.

Schedules of Investments (Continued)

As of December 31, 2021

(Expressed in U.S. Dollars)



|Portfolio
    Investments (a) (b) (c) (d) (e) (f)                                                                     |  | Acquisition
 Date |  | Par |           |  | Cost |   |           | Value | 
|--------------------------------------------------------------------------------------------------------------------- |  | ----------------- |  | --- | --------- |  | ---- | - | --------- | ----- | 
|BANK
    LOANS: NON-CONTROL/NON-AFFILIATE INVESTMENTS (h)(Continued):                                                 |  |                   |  |     |           |  |      |   |           |       | 
|                                                                                                                      |  |                   |  |     |           |  |      |   |           |       | 
|Transportation:
    Cargo                                                                                             |  |                   |  |     |           |  |      |   |           |       | 
|Evans
    Network, Senior Secured Initial Term Loan (First Lien), 9.02% (LIBOR + 4.25%), maturity 8/19/28             |  | 8/6/2021          |  | $   | 3,636,735 |  |      | $ | 3,601,783 |       | 
|Capstone
    Logistics, Senior Secured Closing Date Term Loan (First Lien), 9.52% (LIBOR + 4.75%), maturity 11/12/27  |  | 11/12/2020        |  |     | 2,095,641 |  |      |   | 2,079,357 |       | 
|AIT
    Worldwide Logistics, Senior Secured Initial Term Loan (First Lien), 9.52% (LIBOR + 4.75%), maturity 4/6/28    |  | 12/9/2021         |  |     | 1,975,000 |  |      |   | 1,970,660 |       | 
|St.
    George Logistics, Senior Secured Initial Term Loan, 10.59% (SOFR + 6.00%), maturity 3/24/26                   |  | 4/28/2022         |  |     | 1,492,500 |  |      |   | 1,471,706 |       | 
|Worldwide
    Express, Senior Secured Initial Term Loan (First Lien), 8.77% (LIBOR + 4.00%), maturity 7/26/28 (j)     |  | 7/23/2021         |  |     | 1,485,000 |  |      |   | 1,475,223 |       | 
|FLS
    Transportation, Senior Secured Term B Loan, 10.02% (LIBOR + 5.25%), maturity 12/15/28                         |  | 4/14/2022         |  |     | 1,217,391 |  |      |   | 1,206,381 |       | 
|Omni
    Logistics, Senior Secured Initial Term Loan (First Lien), 9.77% (LIBOR + 5.00%), maturity 12/30/26           |  | 11/24/2021        |  |     | 1,148,217 |  |      |   | 1,137,659 |       | 
|Magnate,
    Senior Secured Initial Term Loan (First Lien), 10.27% (LIBOR + 5.50%), maturity 12/29/28                 |  | 3/11/2022         |  |     | 954,107   |  |      |   | 936,858   |       | 
|Odyssey
    Logistics, Senior Secured New Term Loan (First Lien), 8.77% (LIBOR + 4.00%), maturity 10/12/24 (j)        |  | 11/20/2018        |  |     | 4,191     |  |      |   | 4,183     |       | 
|FLS
    Transportation, Senior Secured Revolving Credit Loan, 10.02% (LIBOR + 5.25%), maturity 12/17/27               |  | 4/14/2022         |  |     | -         |  |      |   | (889      | )     | 
|Omni
    Logistics, Senior Secured Revolving Credit Loan (First Lien), 9.77% (LIBOR + 5.00%), maturity 12/30/25       |  | 11/24/2021        |  |     | -         |  |      |   | (1,119    | )     | 
|                                                                                                                      |  |                   |  |     |           |  |      |   |           |       | 
|Services:
    Consumer                                                                                                |  |                   |  |     |           |  |      |   |           |       | 
|Ned
    Stevens, Senior Secured Initial Term Loan, 11.34% (SOFR + 6.75%), maturity 11/1/29 (i)                        |  | 11/1/2022         |  |     | 3,553,922 |  |      |   | 3,422,937 |       | 
|A
    Place For Mom, Senior Secured Term Loan, 9.27% (LIBOR + 4.50%), maturity 2/10/26                                |  | 7/28/2017         |  |     | 2,208,078 |  |      |   | 2,208,116 |       | 
|Smart
    Start, Senior Secured Term B Loan (Second Lien), 12.52% (LIBOR + 7.75%), maturity 12/16/29                  |  | 12/10/2021        |  |     | 2,000,000 |  |      |   | 1,967,924 |       | 
|Smart
    Start, Senior Secured Term B Loan (First Lien), 9.27% (LIBOR + 4.50%), maturity 12/16/28                    |  | 12/10/2021        |  |     | 1,980,000 |  |      |   | 1,967,493 |       | 
|FullBloom,
    Senior Secured Initial Term Loan (First Lien), 8.84% (SOFR + 4.25%), maturity 12/15/28                 |  | 12/10/2021        |  |     | 1,492,500 |  |      |   | 1,479,301 |       | 
|Teaching
    Strategies, Senior Secured Initial Term Loan (First Lien), 8.34% (SOFR + 3.75%), maturity 8/31/28        |  | 8/19/2021         |  |     | 990,000   |  |      |   | 980,710   |       | 
|Spring
    Education, Senior Secured Initial Term Loan (First Lien), 8.77% (LIBOR + 4.00%), maturity 7/30/25 (j)      |  | 7/26/2018         |  |     | 957,500   |  |      |   | 956,472   |       | 
|Aegis
    Sciences, Senior Secured Initial Term Loan (2018) (First Lien), 10.27% (LIBOR + 5.50%), maturity 5/9/25     |  | 5/4/2018          |  |     | 605,234   |  |      |   | 602,154   |       | 
|Ned
    Stevens, Senior Secured Revolving Loan, 11.34% (SOFR + 6.75%), maturity 11/1/29 (i)                           |  | 11/1/2022         |  |     | -         |  |      |   | (10,154   | )     | 
|                                                                                                                      |  |                   |  |     |           |  |      |   |           |       | 
|Beverage,
    Food & Tobacco                                                                                          |  |                   |  |     |           |  |      |   |           |       | 
|Bettcher
    Industries, Senior Secured Initial Term Loan (Second Lien), 11.84% (SOFR + 7.25%), maturity 12/14/29     |  | 12/13/2021        |  |     | 2,500,000 |  |      |   | 2,477,592 |       | 
|Sovos
    Brands, Senior Secured Initial Term Loan (First Lien), 8.27% (LIBOR + 3.50%), maturity 6/8/28               |  | 6/8/2021          |  |     | 2,033,001 |  |      |   | 2,033,001 |       | 
|Bettcher
    Industries, Senior Secured Initial Term Loan (First Lien), 8.59% (SOFR + 4.00%), maturity 12/14/28       |  | 12/13/2021        |  |     | 1,985,000 |  |      |   | 1,965,440 |       | 
|Hissho
    Sushi, Unitranche Term Loan, 10.59% (SOFR + 6.00%), maturity 5/18/28 (i)                                   |  | 4/7/2022          |  |     | 1,847,857 |  |      |   | 1,811,445 |       | 
|Dessert
    Holdings, Senior Secured Initial Term Loan (First Lien), 8.77% (LIBOR + 4.00%), maturity 6/9/28           |  | 6/7/2021          |  |     | 1,761,792 |  |      |   | 1,750,148 |       | 
|Monogram
    Foods, Senior Secured Initial Term Loan, 8.77% (LIBOR + 4.00%), maturity 8/28/28                         |  | 8/13/2021         |  |     | 990,000   |  |      |   | 981,323   |       | 
|Hissho
    Sushi, Senior Secured Revolving Credit Loan, 10.59% (SOFR + 6.00%), maturity 5/18/28 (i)                   |  | 4/7/2022          |  |     | 28,571    |  |      |   | 27,905    |       | 
|                                                                                                                      |  |                   |  |     |           |  |      |   |           |       | 
|Automotive                                                                                                            |  |                   |  |     |           |  |      |   |           |       | 
|BBB
    Industries, Senior Secured Initial Term Loan (First Lien), 9.84% (SOFR + 5.25%), maturity 7/31/29             |  | 6/30/2022         |  |     | 3,000,000 |  |      |   | 2,713,911 |       | 
|Highline,
    Senior Secured Initial Term Loan (First Lien), 9.27% (LIBOR + 4.50%), maturity 11/9/27                  |  | 10/29/2020        |  |     | 2,813,523 |  |      |   | 2,759,164 |       | 
|Rough
    Country, Senior Secured Initial Term Loan (First Lien), 8.27% (LIBOR + 3.50%), maturity 7/28/28             |  | 7/26/2021         |  |     | 1,975,000 |  |      |   | 1,970,698 |       | 
|Truck
    Hero, Senior Secured Initial Term Loan, 8.52% (LIBOR + 3.75%), maturity 1/31/28                             |  | 1/20/2021         |  |     | 1,473,750 |  |      |   | 1,473,750 |       | 
|Innovative
    XCessories, Senior Secured Initial Term Loan, 9.02% (LIBOR + 4.25%), maturity 3/5/27                   |  | 2/27/2020         |  |     | 786,124   |  |      |   | 785,092   |       | 
|Safe
    Fleet, Senior Secured Initial Term Loan (Second Lien), 11.34% (SOFR + 6.75%), maturity 2/2/26                |  | 2/23/2022         |  |     | 500,000   |  |      |   | 500,000   |       | 
|Wheel
    Pros, Senior Secured Initial Term Loan (First Lien), 9.27% (LIBOR + 4.50%), maturity 5/11/28                |  | 4/23/2021         |  |     | 493,750   |  |      |   | 489,984   |       | 
|                                                                                                                      |  |                   |  |     |           |  |      |   |           |       | 
|Construction &
    Building                                                                                           |  |                   |  |     |           |  |      |   |           |       | 
|A1
    Garage Door Service, Unitranche Term A Loan, 11.09% (SOFR + 6.50%), maturity 12/23/28 (i) (j)                  |  | 12/22/2022        |  |     | 1,826,446 |  |      |   | 1,762,273 |       | 
|Tangent,
    Senior Secured Closing Date Term Loan (First Lien), 9.52% (LIBOR + 4.75%), maturity 11/30/27             |  | 10/2/2019         |  |     | 1,781,392 |  |      |   | 1,774,395 |       | 
|PlayPower,
    Senior Secured Initial Term Loan, 10.27% (LIBOR + 5.50%), maturity 5/8/26                              |  | 5/10/2019         |  |     | 1,737,472 |  |      |   | 1,737,472 |       | 
|PlayCore,
    Senior Secured Initial Term Loan (Second Lien), 12.52% (LIBOR + 7.75%), maturity 9/29/25                |  | 2/7/2020          |  |     | 1,500,000 |  |      |   | 1,480,817 |       | 
|Specialty
    Products & Insulation, Senior Secured Tranche B-1 Term Loan, 9.84% (SOFR + 5.25%), maturity 12/21/27    |  | 3/16/2022         |  |     | 994,023   |  |      |   | 984,887   |       | 
|Dodge
    Construction Network, Senior Secured Initial Term Loan (First Lien), 9.34% (SOFR + 4.75%), maturity 2/23/29 |  | 2/10/2022         |  |     | 995,000   |  |      |   | 981,676   |       | 
|PlayCore,
    Senior Secured Initial Term Loan (First Lien), 8.52% (LIBOR + 3.75%), maturity 9/30/24                  |  | 9/18/2017         |  |     | 946,930   |  |      |   | 945,987   |       | 
|Acuren,
    Senior Secured Initial Term Loan, 9.02% (LIBOR + 4.25%), maturity 1/23/27                                 |  | 1/17/2020         |  |     | 473,783   |  |      |   | 472,348   |       | 
|Hoffman
    Southwest, Senior Secured Initial Term Loan, 10.27% (LIBOR + 5.50%), maturity 8/14/23                     |  | 5/16/2019         |  |     | 422,238   |  |      |   | 425,188   |       | 
|A1
    Garage Door Service, Senior Secured Revolving Loan, 11.09% (SOFR + 6.50%), maturity 12/23/28 (i) (j)           |  | 12/22/2022        |  |     | -         |  |      |   | (8,264    | )     | 
|                                                                                                                      |  |                   |  |     |           |  |      |   |           |       | 
|Environmental
    Industries                                                                                          |  |                   |  |     |           |  |      |   |           |       | 
|Alliance
    Environmental, Unitranche Initial Term Loan, 10.77% (LIBOR + 6.00%), maturity 12/30/27 (i)               |  | 12/30/2021        |  |     | 4,115,728 |  |      |   | 4,046,325 |       | 
|Denali
    Water Solutions, Senior Secured Closing Date Term Loan, 9.02% (LIBOR + 4.25%), maturity 3/27/28            |  | 3/18/2021         |  |     | 1,970,000 |  |      |   | 1,952,515 |       | 
|Keter
    Environmental Services, Unitranche Closing Date Term Loan, 11.27% (LIBOR + 6.50%), maturity 10/29/27        |  | 11/5/2021         |  |     | 495,000   |  |      |   | 490,704   |       | 
|Denali
    Water Solutions, Senior Secured Amendment No. 3 Term Loan, 9.21% (SOFR + 4.63%), maturity 3/27/28          |  | 5/5/2022          |  |     | 497,500   |  |      |   | 481,376   |       | 
|Alliance
    Environmental, Senior Secured Revolving Loan, 10.77% (LIBOR + 6.00%), maturity 12/30/27 (i)              |  | 12/30/2021        |  |     | 314,570   |  |      |   | 307,947   |       | 
|Keter
    Environmental Services, Unitranche Revolving Loan, 11.27% (LIBOR + 6.50%), maturity 10/29/27                |  | 11/5/2021         |  |     | 27,360    |  |      |   | 26,585    |       | 
|                                                                                                                      |  |                   |  |     |           |  |      |   |           |       | 
|Consumer
    Goods: Non-durable                                                                                       |  |                   |  |     |           |  |      |   |           |       | 
|Hoffmaster
    Group, Senior Secured Tranche B-1 Term Loan (First Lien), 8.77% (LIBOR + 4.00%), maturity 11/21/23     |  | 11/9/2016         |  |     | 2,368,573 |  |      |   | 2,367,209 |       | 
|Augusta
    Sportswear, Senior Secured Initial Term Loan, 10.09% (SOFR + 5.50%), maturity 4/25/25                     |  | 11/2/2016         |  |     | 2,001,028 |  |      |   | 1,999,579 |       | 
|Hoffmaster
    Group, Senior Secured Initial Term Loan (Second Lien), 14.27% (LIBOR + 9.50%), maturity 11/21/24       |  | 2/7/2020          |  |     | 1,250,000 |  |      |   | 1,250,000 |       | 
|                                                                                                                      |  |                   |  |     |           |  |      |   |           |       | 
|Wholesale                                                                                                             |  |                   |  |     |           |  |      |   |           |       | 
|Carlisle
    FoodService, Senior Secured Initial Term Loan (First Lien), 7.77% (LIBOR + 3.00%), maturity 3/20/25      |  | 3/16/2018         |  |     | 3,809,768 |  |      |   | 3,810,380 |       | 
|                                                                                                                      |  |                   |  |     |           |  |      |   |           |       | 
|Media:
    Diversified & Production                                                                                   |  |                   |  |     |           |  |      |   |           |       | 
|MediaRadar,
    Unitranche Closing Date Term A Loan, 10.59% (SOFR + 6.00%), maturity 7/22/28 (i)                      |  | 5/23/2022         |  |     | 1,832,444 |  |      |   | 1,788,565 |       | 
|Ansira,
    Unitranche Legacy Term Loan, 6.50% (Fixed) 6.50% PIK, maturity 12/20/24                                   |  | 12/20/2016        |  |     | 2,266,689 |  |      |   | 2,263,320 |       | 
|MediaRadar,
    Senior Secured Revolving Loan, 10.59% (SOFR + 6.00%), maturity 7/22/28 (i)                            |  | 9/16/2022         |  |     | -         |  |      |   | (7,407    | )     | 
|                                                                                                                      |  |                   |  |     |           |  |      |   |           |       | 
|Hotels, Gaming & Leisure                                                                                              |  |                   |  |     |           |  |      |   |           |       | 
|Northstar,
    Senior Secured Term Loan, 12.02% (LIBOR + 7.25%) 1.00% PIK, maturity 6/7/24                            |  | 5/8/2017          |  |     | 1,294,954 |  |      |   | 1,294,954 |       | 
|Auto
    Europe, Senior Secured Initial Dollar Term Loan, 9.59% (SOFR + 5.00%), maturity 10/21/23                     |  | 10/19/2016        |  |     | 1,119,231 |  |      |   | 1,117,283 |       | 





81







Audax Credit BDC Inc.

Schedules of Investments (Continued)

As of December 31, 2021

(Expressed in U.S. Dollars)



|Portfolio
    Investments (a) (b) (c) (d) (e) (f)                                                               |  | Acquisition
 Date |  | Par |           |  | Cost |   |             | Value | 
|--------------------------------------------------------------------------------------------------------------- |  | ----------------- |  | --- | --------- |  | ---- | - | ----------- | ----- | 
|BANK
    LOANS:  NON-CONTROL/NON-AFFILIATE INVESTMENTS(h)(Continued):                                           |  |                   |  |     |           |  |      |   |             |       | 
|                                                                                                                |  |                   |  |     |           |  |      |   |             |       | 
|Metals &
    Mining                                                                                             |  |                   |  |     |           |  |      |   |             |       | 
|Dynatect
    (A&A), Senior Secured Term B Loan, 9.27% (LIBOR + 4.50%), maturity 9/30/24                         |  | 8/16/2019         |  |     | 1,689,870 |  |      |   | 1,680,609   |       | 
|                                                                                                                |  |                   |  |     |           |  |      |   |             |       | 
|Forest
    Products & Paper                                                                                     |  |                   |  |     |           |  |      |   |             |       | 
|Loparex,
    Senior Secured Initial Term Loan (First Lien), 9.27% (LIBOR + 4.50%), maturity 7/31/26             |  | 7/29/2019         |  |     | 1,451,250 |  |      |   | 1,443,028   |       | 
|                                                                                                                |  |                   |  |     |           |  |      |   |             |       | 
|Utilities:
    Electric                                                                                         |  |                   |  |     |           |  |      |   |             |       | 
|Systems
    Control, Senior Secured Initial Term Loan, 9.27% (LIBOR + 4.50%), maturity 3/28/25                  |  | 6/15/2021         |  |     | 1,475,482 |  |      |   | 1,473,812   |       | 
|                                                                                                                |  |                   |  |     |           |  |      |   |             |       | 
|Retail                                                                                                          |  |                   |  |     |           |  |      |   |             |       | 
|Varsity
    Brands, Senior Secured Initial Term Loan (First Lien), 8.27% (LIBOR + 3.50%), maturity 12/16/24 (j) |  | 10/17/2018        |  |     | 957,221   |  |      |   | 960,242     |       | 
|StubHub,
    Senior Secured USD Term B Loan, 8.27% (LIBOR + 3.50%), maturity 2/12/27                            |  | 1/31/2020         |  |     | 485,000   |  |      |   | 483,510     |       | 
|                                                                                                                |  |                   |  |     |           |  |      |   |             |       | 
|Utilities:
    Water                                                                                            |  |                   |  |     |           |  |      |   |             |       | 
|Aegion,
    Senior Secured Initial Term Loan, 9.52% (LIBOR + 4.75%), maturity 5/17/28                           |  | 4/1/2021          |  |     | 987,499   |  |      |   | 983,463     |       | 
|                                                                                                                |  |                   |  |     |           |  |      |   |             |       | 
|Energy:
    Electricity                                                                                         |  |                   |  |     |           |  |      |   |             |       | 
|Franklin
    Energy, Senior Secured Term B Loan (First Lien), 8.77% (LIBOR + 4.00%), maturity 8/14/26           |  | 8/14/2019         |  |     | 967,500   |  |      |   | 965,978     |       | 
|                                                                                                                |  |                   |  |     |           |  |      |   |             |       | 
|Consumer
    Goods: Durable                                                                                     |  |                   |  |     |           |  |      |   |             |       | 
|Careismatic,
    Senior Secured Initial Term Loan (First Lien), 8.02% (LIBOR + 3.25%), maturity 1/6/28          |  | 1/22/2021         |  |     | 492,500   |  |      |   | 491,455     |       | 
|                                                                                                                |  |                   |  |     |           |  |      |   |             |       | 
|Total Bank Loans                                                                                                |  |                   |  |     |           |  |      | $ | 424,399,110 |       | 
|                                                                                                                |  |                   |  |     |           |  |      |   |             |       | 
|EQUITY AND
    PREFERRED SHARES: NON-CONTROL/NON-AFFILIATE INVESTMENTS- (0.9%)(g)(h):                           |  |                   |  |     |           |  |      |   |             |       | 
|Services:
    Business                                                                                          |  |                   |  |     |           |  |      |   |             |       | 
|InnovateMR,
    Class A Units (387.31 Class A Units) (i) (p) (r)                                                |  | 12/16/2021        |  |     |           |  |      | $ | 387,311     |       | 
|Industrial
    Services Group, Class A Units (238.10 Class A Units) (i) (p) (s)                                 |  | 12/7/2022         |  |     |           |  |      |   | 238,095     |       | 
|Liberty
    Group, Series A-Preferred Units (113,636.36 Series A-Preferred Units) (i) (p) (t)                   |  | 6/6/2022          |  |     |           |  |      |   | 113,636     |       | 
|VC3,
    Class A Units (7,499.03 Class A Units) (i) (p) (u)                                                     |  | 9/16/2022         |  |     |           |  |      |   | 29,846      |       | 
|                                                                                                                |  |                   |  |     |           |  |      |   |             |       | 
|High
    Tech Industries                                                                                        |  |                   |  |     |           |  |      |   |             |       | 
|PracticeTek,
    Class A Units (344,833.35 Class A Units) (i) (p) (v)                                           |  | 11/22/2021        |  |     |           |  |      |   | 377,255     |       | 
|Golden
    Source, Class A Units (117,370.89 Class A Units) (i) (p) (w)                                         |  | 3/25/2022         |  |     |           |  |      |   | 117,371     |       | 
|                                                                                                                |  |                   |  |     |           |  |      |   |             |       | 
|Healthcare &
    Pharmaceuticals                                                                                |  |                   |  |     |           |  |      |   |             |       | 
|InterMed,
    Class A Units (2,484 Class A Units) (i) (p) (x)                                                   |  | 12/22/2022        |  |     |           |  |      |   | 248,380     |       | 
|RevHealth,
    Class A-1 Units (20,547.95 Class A-1 Units) (i) (p) (y)                                          |  | 7/22/2022         |  |     |           |  |      |   | 205,479     |       | 
|Ivy
    Rehab, Class A Units (100 Class A Units) (i) (p) (z)                                                    |  | 3/11/2022         |  |     |           |  |      |   | 100,000     |       | 
|                                                                                                                |  |                   |  |     |           |  |      |   |             |       | 
|Beverage,
    Food & Tobacco                                                                                    |  |                   |  |     |           |  |      |   |             |       | 
|Hissho
    Sushi, Class A Units (25,000 Class A Units) (i) (p) (aa)                                             |  | 4/7/2022          |  |     |           |  |      |   | 250,000     |       | 
|                                                                                                                |  |                   |  |     |           |  |      |   |             |       | 
|Environmental
    Industries                                                                                    |  |                   |  |     |           |  |      |   |             |       | 
|Alliance
    Environmental Group, A-1 Preferred Units (331.13 A-1 Preferred Units) (i) (p) (ab)                 |  | 9/30/2019         |  |     |           |  |      |   | 331,126     |       | 
|                                                                                                                |  |                   |  |     |           |  |      |   |             |       | 
|Construction &
    Building                                                                                     |  |                   |  |     |           |  |      |   |             |       | 
|A1
    Garage Door Service, Class A Common Units (272.73 Class A Common Units) (i) (p) (ac)                     |  | 12/22/2022        |  |     |           |  |      |   | 272,727     |       | 
|                                                                                                                |  |                   |  |     |           |  |      |   |             |       | 
|Services:
    Consumer                                                                                          |  |                   |  |     |           |  |      |   |             |       | 
|Ned
    Stevens, Class B Common Units (261.44 Class B Common Units) (i) (p) (ad)                                |  | 11/1/2022         |  |     |           |  |      |   | 261,438     |       | 
|                                                                                                                |  |                   |  |     |           |  |      |   |             |       | 
|Chemicals,
    Plastics & Rubber                                                                                |  |                   |  |     |           |  |      |   |             |       | 
|Vertellus,
    Series A Units (1,651 Series A Units) (i) (p) (ae)                                               |  | 12/22/2020        |  |     |           |  |      |   | 165,138     |       | 
|                                                                                                                |  |                   |  |     |           |  |      |   |             |       | 
|Banking,
    Finance, Insurance & Real Estate                                                                   |  |                   |  |     |           |  |      |   |             |       | 
|Cherry
    Bekaert, Class A Units (129,870.13 Class A Units) (i) (p) (af)                                       |  | 6/30/2022         |  |     |           |  |      |   | 129,870     |       | 
|                                                                                                                |  |                   |  |     |           |  |      |   |             |       | 
|Media:
    Advertising, Printing & Publishing                                                                   |  |                   |  |     |           |  |      |   |             |       | 
|MediaRadar,
    Class A-1 Units (74,074.07 Class A-1 Units) (i) (p) (ag)                                        |  | 9/16/2022         |  |     |           |  |      |   | 74,074      |       | 
|Total Equity and Preferred
    Shares                                                                           |  |                   |  |     |           |  |      | $ | 3,301,746   |       | 
|                                                                                                                |  |                   |  |     |           |  |      |   |             |       | 
|Total
    Portfolio Investments (ah)                                                                            |  |                   |  |     |           |  |      | $ | 427,700,856 |       | 



| | (a) | All
companies are located in the United States of America, unless otherwise noted.
| | --- | ----------------------------------------------------------------------------------

| | (b) | Interest
rate percentages represent actual interest rates as of December 31, 2022, which are indexed to the noted reference rate. The referenced
rates are subject tointerest floors which can vary based on contractual agreements with the borrower.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (c) | All
loans are income-producing, unless otherwise noted.
| | --- | -------------------------------------------------------

| | (d) | All
investments are qualifying assets under Section 55(a) of the Investment Company Act of 1940, as amended (the "1940 Act")
unless otherwise noted.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------

| | (e) | All
investments are exempt from registration under the Securities Act of 1933 (the “Securities Act”), and may be deemed to be
 “restricted securities” under the Securities Act.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (f) | Unless
indicated otherwise, all of our investments are valued using Level 3 inputs within the FASB Accounting Standard Codification (“ASC”)
Topic 820, “Fair Value Measurements and Disclosures” (“ASC 820”) fair value
hierarchy. Refer to Note 3 – Investments in the accompanying Notes to Financial Statements for additional information.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (g) | Percentages
are calculated using fair value of investments over net assets.
| | --- | ---------------------------------------------------------------------------

| | (h) | As
defined in 1940 Act, the Company is not deemed to be an “Affiliated Person” of or “Control” this portfolio company
because it neither owns 5% or  more of the portfolio company’s outstanding voting securities nor has the power
to exercise control over the management or policies of such portfolio company (including through a management agreement).
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (i) | Three
of our affiliated funds, Audax Direct Lending Solutions Fund - A, L.P., Audax Direct Lending Solutions Fund - C, L.P., and Audax Direct
Lending Solutions Fund - D, L.P.,co-invested with us in this portfolio company pursuant to an exemptive order granted by the
U.S. Securities and Exchange Commission.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (j) | Investment
was valued using Level 2 inputs within the ASC 820 fair value hierarchy.  Refer to Note 3 – Investments in the accompanying
Notes to Financial Statements for additional information.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (k) | The
Company headquarters for UDG is located in Ireland.
| | --- | -------------------------------------------------------

| | (l) | The
Company purchased the investment, pursuant to a repurchase agreement with a rate of 1.9626 basis points per day with Macquarie US Trading
LLC, dated June 21, 2022, due January 17, 2023.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (m) | The
Company purchased the investment, pursuant to a repurchase agreement with a rate of 1.9530 basis points per day with Macquarie US Trading
LLC, dated July 19, 2022, due January 15, 2023.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (n) | The
Company headquarters for Sophos & Integro are located in United Kingdom.
| | --- | ----------------------------------------------------------------------------

| | (o) | The
Company headquarters for Intertape Polymer is located in Canada.
| | --- | --------------------------------------------------------------------

| | (p) | Investment
is non-income producing.
| | --- | -----------------------------------

| | (q) | Investment
is on non-accrual
| | --- | ----------------------------

| | (r) | Represents
an investment in APD INN Equity, L.P., a holding company, made through an affiliated equity aggregator vehicle.
| | --- | --------------------------------------------------------------------------------------------------------------------------

| | (s) | Represents
an investment in APD ISG Equity Blocker, L.P., a holding company, made through an affiliated equity aggregator vehicle.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------

| | (t) | Represents
an investment in APD TLG Equity, L.P., a holding company, made through an affiliated equity aggregator vehicle.
| | --- | --------------------------------------------------------------------------------------------------------------------------

| | (u) | Represents
an investment in APD VC3 Equity, L.P., a holding company, made through an affiliated equity aggregator vehicle.
| | --- | --------------------------------------------------------------------------------------------------------------------------

| | (v) | Represents
an investment in APD Ptek Equity, L.P., a holding company, made through an affiliated equity aggregator vehicle.
| | --- | ---------------------------------------------------------------------------------------------------------------------------

| | (w) | Represents
an investment in APD Gol Equity, L.P., a holding company, made through an affiliated equity aggregator vehicle.
| | --- | --------------------------------------------------------------------------------------------------------------------------

| | (x) | Represents
an investment in APD IMD Equity, L.P., a holding company, made through an affiliated equity aggregator vehicle.
| | --- | --------------------------------------------------------------------------------------------------------------------------

| | (y) | Represents
an investment in APD RH Equity Blocker, L.P., a holding company, made through an affiliated equity aggregator vehicle.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------

| | (z) | Represents
an investment in APD IVY Equity Blocker, L.P., a holding company, made through an affiliated equity aggregator vehicle.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------

| | (aa) | Represents
an investment in APD Sush Equity Blocker, L.P., a holding company, made through an affiliated equity aggregator vehicle.
| | ---- | -----------------------------------------------------------------------------------------------------------------------------------

| | (ab) | Represents
an investment in APD AEG Equity Blocker, L.P., a holding company, made through an affiliated equity aggregator vehicle.
| | ---- | ----------------------------------------------------------------------------------------------------------------------------------

| | (ac) | Represents
an investment in APD GAR Equity, L.P., a holding company, made through an affiliated equity aggregator vehicle.
| | ---- | --------------------------------------------------------------------------------------------------------------------------

| | (ad) | Represents
an investment in APD NS Equity, L.P., a holding company, made through an affiliated equity aggregator vehicle.
| | ---- | -------------------------------------------------------------------------------------------------------------------------

| | (ae) | Represents
an investment in ADP VERT Equity, L.P., a holding company, made through an affiliated equity aggregator vehicle.
| | ---- | ---------------------------------------------------------------------------------------------------------------------------

| | (af) | Represents
an investment in APD CBA Equity Blocker, L.P., a holding company, made through an affiliated equity aggregator vehicle.
| | ---- | ----------------------------------------------------------------------------------------------------------------------------------

| | (ag) | Represents
an investment in APD MDR Equity, L.P., a holding company, made through an affiliated equity aggregator vehicle.
| | ---- | --------------------------------------------------------------------------------------------------------------------------

| | (ah) | At
December 31, 2022, the cost of investments for income tax purposes was $427,700,856, the gross unrealized depreciation for federal
tax purposes was $9,092,100, the gross unrealized appreciation for federal income tax purposes was $2,219,902, and the net unrealized
depreciation was $6,872,198.
| | ---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





82









Audax Credit BDC Inc.

Schedules of Investments

As of December 31, 2021

(Expressed in U.S. Dollars)



|Portfolio
    Investments (a) (b) (c) (d) (e) (f)                                                                                        |  | Acquisition
 Date |  | Par |           |  | Cost |   |           | Value | 
|---------------------------------------------------------------------------------------------------------------------------------------- |  | ----------------- |  | --- | --------- |  | ---- | - | --------- | ----- | 
|BANK
    LOANS: NON-CONTROL/NON-AFFILIATE INVESTMENTS - (107.4%)(g)(h):                                                                  |  |                   |  |     |           |  |      |   |           |       | 
|                                                                                                                                         |  |                   |  |     |           |  |      |   |           |       | 
|Healthcare &
    Pharmaceuticals                                                                                                         |  |                   |  |     |           |  |      |   |           |       | 
|Radiology
    Partners, Senior Secured Term B Loan (First Lien), 4.46% (Libor + 4.25%), maturity 7/9/25 (i)                              |  | 6/28/2018         |  | $   | 4,215,792 |  |      | $ | 4,353,545 |       | 
|Advarra,
    Senior Secured Initial Term Loan (First Lien), 5.25% (Libor + 4.25%), maturity 7/9/26                                       |  | 6/26/2019         |  |     | 4,145,626 |  |      |   | 4,117,204 |       | 
|Young,
    Senior Secured Initial Term Loan (First Lien), 5.00% (Libor + 4.00%), maturity 11/7/24                                        |  | 11/6/2017         |  |     | 3,755,525 |  |      |   | 3,748,227 |       | 
|American
    Vision Partners, Senior Secured Term Loan, 6.50% (Libor + 5.75%), maturity 9/30/27 (i)(k)                                   |  | 9/22/2021         |  |     | 3,537,645 |  |      |   | 3,473,547 |       | 
|InHealth
    Medical Alliance, Senior Secured Initial Term Loan, 7.00% (Libor + 6.00%), maturity 6/28/28                                 |  | 6/25/2021         |  |     | 3,491,250 |  |      |   | 3,457,150 |       | 
|PharMedQuest,
    Senior Secured Initial Term Loan, 6.75% (Libor + 5.75%), maturity 10/31/24 (k)                                         |  | 11/6/2019         |  |     | 3,290,898 |  |      |   | 3,262,290 |       | 
|Zest
    Dental, Senior Secured Initial Term Loan (First Lien), 3.71% (Libor + 3.50%), maturity 3/14/25 (i)                              |  | 5/30/2018         |  |     | 3,239,110 |  |      |   | 3,251,658 |       | 
|Waystar,
    Senior Secured Initial Term Loan (First Lien), 4.21% (Libor + 4.00%), maturity 10/22/26 (i)                                 |  | 9/19/2019         |  |     | 2,949,975 |  |      |   | 2,942,792 |       | 
|Physicians
    Endoscopy, Senior Secured Initial Term Loan (First Lien), 5.75% (Libor + 4.75%) PIK, maturity 8/18/23                     |  | 8/18/2016         |  |     | 2,860,384 |  |      |   | 2,847,320 |       | 
|Zelis
    RedCard, Senior Secured Term B-1 Loan, 3.71% (Libor + 3.50%), maturity 9/30/26 (i)                                             |  | 9/27/2019         |  |     | 2,420,641 |  |      |   | 2,410,411 |       | 
|Soliant,
    Senior Secured Initial Term Loan, 5.00% (Libor + 4.25%), maturity 3/31/28                                                   |  | 3/26/2021         |  |     | 2,331,250 |  |      |   | 2,313,766 |       | 
|Premise
    Health, Senior Secured Initial Term Loan (First Lien), 3.71% (Libor + 3.50%), maturity 7/10/25                               |  | 8/15/2018         |  |     | 2,282,601 |  |      |   | 2,287,690 |       | 
|nThrive,
    Senior Secured Initial Loan (Second Lien), 7.25% (Libor + 6.75%), maturity 12/17/29 (i)                                     |  | 11/19/2021        |  |     | 2,000,000 |  |      |   | 1,970,000 |       | 
|Advanced
    Diabetes Supply, Senior Secured Term Loan December 2020, 6.25% (Libor + 5.25%), maturity 12/30/26                           |  | 7/13/2021         |  |     | 1,995,000 |  |      |   | 1,975,300 |       | 
|Upstream
    Rehabilitation, Senior Secured August 2021 Incremental Term Loan (First Lien), 4.46% (Libor + 4.25%), maturity 11/20/26 (i) |  | 10/24/2019        |  |     | 1,971,344 |  |      |   | 1,968,456 |       | 
|Alpaca,
    Senior Secured Term Loan, 5.75% (Libor + 4.75%), maturity 4/19/24 (i)(k)                                                     |  | 4/19/2019         |  |     | 1,962,032 |  |      |   | 1,944,465 |       | 
|Press
    Ganey, Senior Secured Initial Term Loan (First Lien), 3.71% (Libor + 3.50%), maturity 7/24/26 (i)                              |  | 7/23/2019         |  |     | 1,955,000 |  |      |   | 1,949,852 |       | 
|Gastro
    Health, Senior Secured Initial Term Loan (First Lien), 5.25% (Libor + 4.50%), maturity 7/3/28                                 |  | 7/2/2021          |  |     | 1,900,025 |  |      |   | 1,890,025 |       | 
|Avalign
    Technologies, Senior Secured Initial Term Loan (First Lien), 4.71% (Libor + 4.50%), maturity 12/22/25                        |  | 12/19/2018        |  |     | 1,940,000 |  |      |   | 1,929,264 |       | 
|CareCentrix,
    Senior Secured Initial Term Loan, 4.71% (Libor + 4.50%), maturity 4/3/25 (i) (j)                                        |  | 4/2/2018          |  |     | 1,604,069 |  |      |   | 1,599,839 |       | 
|Symplr,
    Senior Secured Initial Term Loan (First Lien), 5.25% (Libor + 4.50%), maturity 12/22/27 (i)                                  |  | 11/23/2020        |  |     | 1,488,750 |  |      |   | 1,466,850 |       | 
|Therapy
    Brands, Senior Secured Initial Term Loan (First Lien), 4.75% (Libor + 4.00%), maturity 5/18/28                               |  | 5/12/2021         |  |     | 1,496,250 |  |      |   | 1,489,050 |       | 
|Blue
    Cloud, Unitranche, 6.00% (Libor + 5.00%), maturity 12/31/27 (i)                                                                 |  | 12/13/2021        |  |     | 1,500,000 |  |      |   | 1,485,000 |       | 
|Quantum
    Health, Senior Secured Amendment No. 1 Refinancing Term Loan (First Lien), 5.25% (Libor + 4.50%), maturity 12/22/27          |  | 12/18/2020        |  |     | 1,492,500 |  |      |   | 1,470,450 |       | 
|Mission
    Veterinary Partners, Senior Secured Initial Term Loan (First Lien), 4.75% (Libor + 4.00%), maturity 4/27/28 (i)              |  | 12/15/2021        |  |     | 1,496,250 |  |      |   | 1,481,288 |       | 
|CPS,
    Unitranche, 6.25% (Libor + 5.25%), maturity 2/28/25 (k)                                                                         |  | 3/1/2019          |  |     | 1,462,164 |  |      |   | 1,449,283 |       | 
|Tecomet,
    Senior Secured 2017 Term Loan (First Lien), 4.50% (Libor + 3.50%), maturity 5/1/24                                          |  | 1/10/2019         |  |     | 1,155,903 |  |      |   | 1,153,742 |       | 
|Solis
    Mammography, Senior Secured Initial Term Loan (First Lien), 5.50% (Libor + 4.75%), maturity 4/17/28 (i)                        |  | 4/1/2021          |  |     | 1,060,833 |  |      |   | 1,051,433 |       | 
|nThrive,
    Senior Secured Initial Term Loan (First Lien), 4.50% (Libor + 4.00%), maturity 12/18/28 (i)                                 |  | 11/19/2021        |  |     | 1,000,000 |  |      |   | 995,000   |       | 
|Wedgewood
    Pharmacy, Senior Secured Initial Term Loan, 5.00% (Libor + 4.25%), maturity 3/31/28                                        |  | 2/24/2021         |  |     | 997,500   |  |      |   | 987,800   |       | 
|Solis
    Mammography, Senior Secured Initial Term Loan (Second Lien), 8.75% (Libor + 8.00%), maturity 4/16/29                           |  | 4/1/2021          |  |     | 1,000,000 |  |      |   | 985,600   |       | 
|Allied
    Benefit Systems, Senior Secured Initial Term B Loan, 5.50% (Libor + 4.50%), maturity 11/18/26                                 |  | 10/21/2020        |  |     | 990,000   |  |      |   | 977,586   |       | 
|Athena,
    Senior Secured Term B-1 Loan (First Lien), 4.46% (Libor + 4.25%), maturity 2/11/26 (i)                                       |  | 9/18/2019         |  |     | 980,038   |  |      |   | 973,278   |       | 
|Dermatologists
    of Central States, Senior Secured Term Loan, 9.50% (Libor + 8.50%), maturity 4/20/22 (i)(k)                           |  | 3/12/2020         |  |     | 957,461   |  |      |   | 957,461   |       | 
|Alcami,
    Senior Secured Initial Term Loan (First Lien), 4.46% (Libor + 4.25%), maturity 7/14/25                                       |  | 7/12/2018         |  |     | 967,500   |  |      |   | 964,765   |       | 
|UDG,
    Senior Secured Initial Dollar Term Loan (First Lien), 4.75% (Libor + 4.25%), maturity 8/19/28 (i) (m)                           |  | 8/6/2021          |  |     | 631,875   |  |      |   | 625,651   |       | 
|ImageFirst,
    Senior Secured Initial Term Loan, 5.25% (Libor + 4.50%), maturity 4/27/28                                                |  | 4/26/2021         |  |     | 588,182   |  |      |   | 585,414   |       | 
|MyEyeDr,
    Senior Secured Initial Term Loan (First Lien), 4.46% (Libor + 4.25%), maturity 8/31/26 (i)                                  |  | 8/2/2019          |  |     | 526,700   |  |      |   | 522,986   |       | 
|MedRisk,
    Senior Secured Initial Term Loan (First Lien), 4.50% (Libor + 3.75%), maturity 5/10/28 (i)                                  |  | 4/1/2021          |  |     | 498,750   |  |      |   | 493,900   |       | 
|Press
    Ganey, Senior Secured 2020 Incremental Term Loan (First Lien), 4.75% (Libor + 4.00%), maturity 7/24/26 (i)                     |  | 10/1/2020         |  |     | 496,256   |  |      |   | 492,037   |       | 
|AccentCare,
    Senior Secured 2021 Term Loan (First Lien), 4.21% (Libor + 4.00%), maturity 6/22/26 (i)                                  |  | 6/15/2021         |  |     | 497,500   |  |      |   | 497,500   |       | 
|RMP &
    MedA/Rx, Senior Secured Term Loan, 5.50% (Libor + 4.50%), maturity 2/6/25                                                      |  | 3/22/2021         |  |     | 490,625   |  |      |   | 485,865   |       | 
|AmeriVet,
    Senior Secured Incremental Delayed Draw Term Loan, 5.75% (Libor + 4.75%), maturity 6/5/24                                  |  | 8/27/2021         |  |     | 463,710   |  |      |   | 449,085   |       | 
|RMP &
    MedA/Rx, Senior Secured Term Loan (First Lien), 5.25% (Libor + 4.25%), maturity 2/6/25                                         |  | 2/27/2017         |  |     | 419,565   |  |      |   | 419,470   |       | 
|ATI
    Physical Therapy, Senior Secured Initial Term Loan (First Lien), 4.50% (Libor + 3.50%), maturity 5/10/23 (i)                     |  | 6/28/2016         |  |     | 343,442   |  |      |   | 343,870   |       | 
|Alpaca,
    Senior Secured Revolver, 6.00% (Libor + 5.00%), maturity 4/19/24 (i)(k)                                                      |  | 9/30/2019         |  |     | 129,426   |  |      |   | 125,543   |       | 
|Advarra,
    Senior Secured Initial Revolving Loan (First Lien), 5.25% (Libor + 4.25%), maturity 7/9/24                                  |  | 6/26/2019         |  |     | -         |  |      |   | (7,619    | )     | 
|                                                                                                                                         |  |                   |  |     |           |  |      |   |           |       | 
|Services:
    Business                                                                                                                   |  |                   |  |     |           |  |      |   |           |       | 
|LegalShield,
    Senior Secured Initial Term Loan (First Lien), 4.25% (Libor + 3.75%), maturity 12/15/28 (i)                             |  | 12/7/2021         |  |     | 4,500,000 |  |      |   | 4,455,000 |       | 
|InnovateMR,
    Unitranche, 6.75% (Libor + 5.75%), maturity 1/20/28 (i)(k)                                                               |  | 12/16/2021        |  |     | 4,247,302 |  |      |   | 4,172,974 |       | 
|CoAdvantage,
    Senior Secured Initial Term Loan (First Lien), 6.00% (Libor + 5.00%), maturity 9/23/25 (i)                              |  | 9/26/2019         |  |     | 3,910,000 |  |      |   | 3,884,414 |       | 
|RevSpring,
    Senior Secured Initial Term Loan (First Lien), 4.46% (Libor + 4.25%), maturity 10/11/25 (i)                               |  | 10/5/2018         |  |     | 3,880,000 |  |      |   | 3,877,022 |       | 
|Alliance
    Environmental Group, Unitranche, 7.00% (Libor + 6.00%), maturity 12/30/27 (i) (k)                                           |  | 12/30/2021        |  |     | 3,675,497 |  |      |   | 3,588,742 |       | 
|Veritext,
    Senior Secured Initial Term Loan (First Lien), 3.46% (Libor + 3.25%), maturity 8/1/25 (i)                                  |  | 8/14/2018         |  |     | 3,121,087 |  |      |   | 3,106,891 |       | 
|Fleetwash,
    Senior Secured Incremental Term Loan, 5.75% (Libor + 4.75%), maturity 10/1/24                                             |  | 9/25/2018         |  |     | 2,903,063 |  |      |   | 2,888,125 |       | 
|CoolSys,
    Senior Secured Closing Date Initial Term Loan, 5.50% (Libor + 4.75%), maturity 8/11/28 (i)                                  |  | 8/4/2021          |  |     | 2,590,278 |  |      |   | 2,559,670 |       | 
|Duff &
    Phelps, Senior Secured Initial Dollar Term Loan (First Lien), 4.75% (Libor + 3.75%), maturity 4/9/27 (i)                      |  | 3/6/2020          |  |     | 2,462,500 |  |      |   | 2,443,427 |       | 
|Service
    Logic, Senior Secured Closing Date Initial Term Loan (First Lien), 4.75% (Libor + 4.00%), maturity 10/29/27                  |  | 10/23/2020        |  |     | 2,364,497 |  |      |   | 2,342,229 |       | 
|Vistage,
    Senior Secured Term B Loan (First Lien), 5.00% (Libor + 4.00%), maturity 2/10/25                                            |  | 2/6/2018          |  |     | 2,323,414 |  |      |   | 2,320,751 |       | 





83







Audax Credit BDC Inc.

Schedules of Investments (Continued)

As of December 31, 2021

(Expressed in U.S. Dollars)





|Portfolio
    Investments (a) (b) (c) (d) (e) (f)                                                                                  |  | Acquisition
    Date |  | Par |           |  | Cost |   |           | Value | 
|---------------------------------------------------------------------------------------------------------------------------------- |  | -------------------- |  | --- | --------- |  | ---- | - | --------- | ----- | 
|BANK
    LOANS: NON-CONTROL/NON-AFFILIATE INVESTMENTS(h)(Continued):                                                               |  |                      |  |     |           |  |      |   |           |       | 
|                                                                                                                                   |  |                      |  |     |           |  |      |   |           |       | 
|Services:
    Business (continued)                                                                                                 |  |                      |  |     |           |  |      |   |           |       | 
|The
    Facilities Group, Unitranche, 6.75% (Libor + 5.75%), maturity 11/30/27 (i)                                                 |  | 12/10/2021           |  | $   | 2,258,671 |  |      | $ | 2,236,084 |       | 
|Mediaocean,
    Senior Secured Initial Term Loan, 4.00% (Libor + 3.50%), maturity 12/15/28 (i)                                     |  | 12/9/2021            |  |     | 2,000,000 |  |      |   | 1,980,000 |       | 
|TRC
    Companies, Senior Secured Initial Term Loan (Second Lien), 7.25% (Libor + 6.75%), maturity 12/7/29                         |  | 11/19/2021           |  |     | 2,000,000 |  |      |   | 1,980,000 |       | 
|ECi
    Software, Senior Secured Initial Term Loan (First Lien), 4.50% (Libor + 3.75%), maturity 11/9/27 (i)                       |  | 9/17/2020            |  |     | 1,980,000 |  |      |   | 1,972,543 |       | 
|Veregy,
    Senior Secured Initial Term Loan, 7.00% (Libor + 6.00%), maturity 11/3/27                                              |  | 11/2/2020            |  |     | 1,980,000 |  |      |   | 1,928,567 |       | 
|Sterling
    Backcheck, Senior Secured Initial Term Loan (First Lien), 4.50% (Libor + 3.50%), maturity 6/19/24                     |  | 6/30/2017            |  |     | 1,939,630 |  |      |   | 1,939,630 |       | 
|Insight
    Global, Senior Secured Closing Date Term Loan, 6.75% (Libor + 6.00%), maturity 9/22/28 (j)                             |  | 9/22/2021            |  |     | 1,496,250 |  |      |   | 1,463,626 |       | 
|Epic
    Staffing Group, Senior Secured Initial Term Loan, 7.00% (Libor + 6.00%), maturity 2/5/27                                  |  | 2/3/2021             |  |     | 1,489,968 |  |      |   | 1,460,568 |       | 
|Eliassen
    Group, Senior Secured Initial Term B Loan, 4.46% (Libor + 4.25%), maturity 11/5/24                                    |  | 10/19/2018           |  |     | 1,478,116 |  |      |   | 1,474,158 |       | 
|OSG
    Billing Services, Senior Secured Term B Loan (First Lien), 5.50% (Libor + 4.50%), maturity 3/27/24                         |  | 3/26/2018            |  |     | 1,444,391 |  |      |   | 1,441,757 |       | 
|First
    Advantage, Senior Secured Term B-1 Loan (First Lien), 2.96% (Libor + 2.75%), maturity 1/31/27 (i)                        |  | 1/23/2020            |  |     | 1,100,312 |  |      |   | 1,089,150 |       | 
|Veritext,
    Senior Secured Initial Term Loan (Second Lien), 6.96% (Libor + 6.75%), maturity 7/31/26                              |  | 8/14/2018            |  |     | 1,000,000 |  |      |   | 996,678   |       | 
|Divisions
    Maintenance Group, Senior Secured Term B Loan, 5.50% (Libor + 4.75%), maturity 5/27/28 (i)                           |  | 5/21/2021            |  |     | 997,500   |  |      |   | 988,100   |       | 
|TRC
    Companies, Senior Secured Initial Term Loan (First Lien), 4.25% (Libor + 3.75%), maturity 12/8/28 (i)                      |  | 11/19/2021           |  |     | 1,000,000 |  |      |   | 995,000   |       | 
|trustaff
    Management, Senior Secured Initial Term Loan (First Lien), 4.50% (Libor + 3.75%), maturity 3/6/28 (i)                 |  | 12/9/2021            |  |     | 997,487   |  |      |   | 994,994   |       | 
|eResearch
    (ERT), Senior Secured Initial Term Loan (First Lien), 5.50% (Libor + 4.50%), maturity 2/4/27 (i)                     |  | 12/1/2020            |  |     | 989,956   |  |      |   | 989,956   |       | 
|WCG,
    Senior Secured Initial Term Loan (First Lien), 5.00% (Libor + 4.00%), maturity 1/8/27 (i)                                 |  | 12/13/2019           |  |     | 985,000   |  |      |   | 977,291   |       | 
|Diversified,
    Senior Secured Initial Term Loan, 5.75% (Libor + 4.75%), maturity 12/23/23                                        |  | 4/19/2019            |  |     | 899,347   |  |      |   | 895,961   |       | 
|Secretariat
    International, Senior Secured Initial Term Loan (First Lien), 5.50% (Libor + 4.75%), maturity 12/29/28 (i)         |  | 12/16/2021           |  |     | 850,000   |  |      |   | 845,750   |       | 
|Therma
    Holdings, Senior Secured Initial Term Loan (2021), 4.75% (Libor + 4.00%), maturity 12/16/27 (i)                         |  | 12/11/2020           |  |     | 498,750   |  |      |   | 497,600   |       | 
|System
    One, Senior Secured Initial Term Loan, 4.75% (Libor + 4.00%), maturity 3/2/28 (i)                                       |  | 1/28/2021            |  |     | 497,500   |  |      |   | 495,300   |       | 
|Insight
    Global, Senior Secured Revolving Loan, 6.75% (Libor + 6.00%), maturity 9/22/27                                         |  | 9/23/2021            |  |     | 67,089    |  |      |   | 67,089    |       | 
|Alliance
    Environmental Group, Senior Secured Revolving Loan, 7.00% (Libor + 6.00%), maturity 12/30/27 (i) (k)                  |  | 12/30/2021           |  |     | -         |  |      |   | (6,623    | )     | 
|                                                                                                                                   |  |                      |  |     |           |  |      |   |           |       | 
|High
    Tech Industries                                                                                                           |  |                      |  |     |           |  |      |   |           |       | 
|Qlik,
    Senior Secured 2021 Refinancing Term Loan, 4.21% (Libor + 4.00%), maturity 4/26/24 (i)                                   |  | 3/29/2019            |  |     | 3,900,600 |  |      |   | 3,886,181 |       | 
|Netsmart,
    Senior Secured Initial Term Loan (First Lien), 4.75% (Libor + 4.00%), maturity 10/1/27 (i)                           |  | 9/29/2020            |  |     | 3,473,750 |  |      |   | 3,460,658 |       | 
|Jaggaer,
    Senior Secured Initial Term Loan (First Lien), 4.21% (Libor + 4.00%), maturity 8/14/26 (i)                            |  | 8/9/2019             |  |     | 3,091,100 |  |      |   | 3,087,301 |       | 
|Ivanti
    Software, Senior Secured 2021 Specified Refinancing Term Loan (First Lien), 5.25% (Libor + 4.25%), maturity 12/1/27 (i) |  | 11/20/2020           |  |     | 2,985,000 |  |      |   | 2,947,757 |       | 
|Infogroup,
    Senior Secured Term Loan (First Lien), 6.00% (Libor + 5.00%), maturity 4/3/23 (i)                                   |  | 3/28/2017            |  |     | 2,859,887 |  |      |   | 2,849,374 |       | 
|Planview,
    Senior Secured Closing Date Term Loan (First Lien), 4.75% (Libor + 4.00%), maturity 12/17/27 (i)                     |  | 12/11/2020           |  |     | 2,632,290 |  |      |   | 2,607,384 |       | 
|Idera,
    Senior Secured Term B-1 Loan (First Lien), 4.50% (Libor + 3.75%), maturity 3/2/28 (i)                                   |  | 6/27/2017            |  |     | 2,599,317 |  |      |   | 2,598,562 |       | 
|Precisely,
    Senior Secured Third Amendment Term Loan (First Lien), 4.75% (Libor + 4.00%), maturity 4/24/28 (i)                  |  | 3/19/2021            |  |     | 2,493,750 |  |      |   | 2,481,850 |       | 
|Flexera
    Software, Senior Secured Term B-1 Loan (First Lien), 4.50% (Libor + 3.75%), maturity 3/3/28 (i)                        |  | 2/16/2020            |  |     | 2,390,742 |  |      |   | 2,390,742 |       | 
|PracticeTek,
    Unitranche, 5.71% (Libor + 5.50%), maturity 11/23/27 (i)(k)                                                       |  | 11/22/2021           |  |     | 2,275,763 |  |      |   | 2,210,067 |       | 
|Sophos,
    Senior Secured Dollar Tranche Term Loan (First Lien), 3.71% (Libor + 3.50%), maturity 3/5/27 (i)(n)                    |  | 1/16/2020            |  |     | 1,970,012 |  |      |   | 1,877,597 |       | 
|QuickBase,
    Senior Secured Term Loan (First Lien), 4.21% (Libor + 4.00%), maturity 4/2/26                                       |  | 3/29/2019            |  |     | 1,950,000 |  |      |   | 1,943,834 |       | 
|Intermedia
    , Senior Secured New Term Loan (First Lien), 7.00% (Libor + 6.00%), maturity 7/21/25 (i)                            |  | 7/13/2018            |  |     | 1,940,000 |  |      |   | 1,931,203 |       | 
|Bomgar,
    Senior Secured Initial Term Loan (First Lien), 4.21% (Libor + 4.00%), maturity 4/18/25 (i)                             |  | 5/25/2018            |  |     | 1,641,251 |  |      |   | 1,647,580 |       | 
|OEConnection,
    Senior Secured Initial Term Loan, 4.21% (Libor + 4.00%), maturity 9/25/26 (i)                                    |  | 9/24/2019            |  |     | 1,608,578 |  |      |   | 1,603,485 |       | 
|Digital
    Room, Senior Secured Closing Date Term Loan (First Lien), 5.75% (Libor + 5.25%), maturity 12/21/28 (i)                 |  | 12/16/2021           |  |     | 1,500,000 |  |      |   | 1,485,000 |       | 
|Navex
    Global, Senior Secured Initial Term Loan (First Lien), 3.46% (Libor + 3.25%), maturity 9/5/25 (i)                        |  | 8/15/2018            |  |     | 1,451,250 |  |      |   | 1,441,800 |       | 
|ORBCOMM,
    Senior Secured Closing Date Term Loan (First Lien), 5.00% (Libor + 4.25%), maturity 9/1/28 (i)                        |  | 6/17/2021            |  |     | 997,500   |  |      |   | 992,500   |       | 
|Infoblox,
    Senior Secured Initial Term Loan (First Lien), 4.50% (Libor + 3.75%), maturity 12/1/27 (i)                           |  | 10/7/2020            |  |     | 995,000   |  |      |   | 990,862   |       | 
|Veracode,
    Senior Secured Initial Term Loan, 4.75% (Libor + 4.00%), maturity 11/5/27                                            |  | 10/30/2020           |  |     | 992,500   |  |      |   | 984,143   |       | 
|Barracuda,
    Senior Secured 2020 Term Loan (First Lien), 4.50% (Libor + 3.75%), maturity 2/12/25 (i)                             |  | 3/2/2018             |  |     | 987,500   |  |      |   | 987,500   |       | 
|SmartBear,
    Senior Secured Initial Term Loan (First Lien), 4.75% (Libor + 4.25%), maturity 3/3/28                               |  | 11/20/2020           |  |     | 995,000   |  |      |   | 985,600   |       | 
|HelpSystems,
    Senior Secured Seventh Amendment Refinancing Loan (First Lien), 4.75% (Libor + 4.00%), maturity 11/19/26 (i)      |  | 12/19/2019           |  |     | 989,981   |  |      |   | 987,772   |       | 
|Imperva,
    Senior Secured Term Loan, 5.00% (Libor + 4.00%), maturity 1/12/26 (i)                                                 |  | 9/23/2020            |  |     | 986,095   |  |      |   | 978,665   |       | 
|Unison,
    Unitranche, 8.00% (Libor + 7.00%), maturity 6/25/26 (k)                                                                |  | 6/25/2020            |  |     | 985,000   |  |      |   | 965,242   |       | 
|Cloudera,
    Senior Secured Initial Term Loan (First Lien), 4.25% (Libor + 3.75%), maturity 10/8/28 (i)                           |  | 8/10/2021            |  |     | 500,000   |  |      |   | 495,030   |       | 
|DigiCert,
    Senior Secured Initial Term Loan (First Lien), 4.00% (Libor + 4.00%), maturity 10/16/26 (i)                          |  | 3/13/2020            |  |     | 491,250   |  |      |   | 469,316   |       | 
|PracticeTek,
    Senior Secured Revolving Loan, 5.71% (Libor + 5.50%), maturity 11/23/27 (i)(k)                                    |  | 11/22/2021           |  |     | -         |  |      |   | (7,156    | )     | 
|                                                                                                                                   |  |                      |  |     |           |  |      |   |           |       | 
|Containers,
    Packaging & Glass                                                                                                  |  |                      |  |     |           |  |      |   |           |       | 
|InMark,
    Senior Secured Incremental Term Loan, 7.00% (Libor + 6.00%), maturity 12/23/26 (i)(k)                                  |  | 12/10/2021           |  |     | 3,740,625 |  |      |   | 3,653,125 |       | 
|Transcendia,
    Senior Secured 2017 Refinancing Term Loan (First Lien), 4.50% (Libor + 3.50%), maturity 5/30/24 (j)               |  | 5/11/2017            |  |     | 3,353,069 |  |      |   | 3,345,694 |       | 
|Anchor
    Packaging, Senior Secured Initial Term Loan (First Lien), 4.21% (Libor + 4.00%), maturity 7/18/26 (i)                   |  | 7/17/2019            |  |     | 2,879,678 |  |      |   | 2,868,302 |       | 
|Brook &
    Whittle, Senior Secured Initial Term Loan (First Lien), 4.50% (Libor + 4.00%), maturity 12/14/28 (i)                   |  | 12/9/2021            |  |     | 2,500,000 |  |      |   | 2,477,355 |       | 
|Packaging
    Coordinators, Senior Secured Term B Loan (First Lien), 4.50% (Libor + 3.75%), maturity 11/30/27 (i)                  |  | 9/25/2020            |  |     | 2,468,813 |  |      |   | 2,460,773 |       | 
|Paragon
    Films, Senior Secured Closing Date Term Loan (First Lien), 5.50% (Libor + 5.00%), maturity 12/16/28 (i)                |  | 12/15/2021           |  |     | 2,000,000 |  |      |   | 1,978,515 |       | 
|Resource
    Label Group, Senior Secured Closing Date Initial Term Loan (First Lien), 5.00% (Libor + 4.25%), maturity 7/7/28 (i)   |  | 7/2/2021             |  |     | 1,879,747 |  |      |   | 1,870,648 |       | 
|TricorBraun,
    Senior Secured Closing Date Initial Term Loan (First Lien), 3.75% (Libor + 3.25%), maturity 3/3/28 (i)            |  | 1/29/2021            |  |     | 1,828,762 |  |      |   | 1,820,245 |       | 
|Potters
    Industries, Senior Secured Initial Term Loan, 4.21% (Libor + 4.00%), maturity 12/14/27 (i)                             |  | 11/19/2020           |  |     | 1,488,750 |  |      |   | 1,476,336 |       | 
|Technimark,
    Senior Secured Initial Term Loan (First Lien), 4.25% (Libor + 3.75%), maturity 7/7/28 (i)                          |  | 6/30/2021            |  |     | 1,492,500 |  |      |   | 1,485,300 |       | 
|Tekni-Plex,
    Senior Secured Tranche B-3 Initial Term Loan, 4.50% (Libor + 4.00%), maturity 9/15/28 (i)                          |  | 7/29/2021            |  |     | 1,054,520 |  |      |   | 1,052,080 |       | 
|Lacerta,
    Senior Secured Term Loan, 6.25% (Libor + 5.50%), maturity 12/30/26                                                    |  | 2/8/2021             |  |     | 990,000   |  |      |   | 980,150   |       | 
|Pregis
    Corporation, Senior Secured Initial Term Loan (First Lien), 4.21% (Libor + 4.00%), maturity 7/31/26 (i)                 |  | 7/25/2019            |  |     | 980,000   |  |      |   | 978,319   |       | 
|Tank
    Holding, Senior Secured 2020 Refinancing Term Loan (First Lien), 3.46% (Libor + 3.25%), maturity 3/26/26 (i)              |  | 3/21/2019            |  |     | 977,500   |  |      |   | 974,681   |       | 
|Applied
    Adhesives, Senior Secured Term A Loan, 5.75% (Libor + 5.00%), maturity 3/12/27                                         |  | 3/12/2021            |  |     | 563,158   |  |      |   | 557,688   |       | 
|Golden
    West Packaging, Senior Secured Initial Term Loan, 6.00% (Libor + 5.25%), maturity 12/1/27                               |  | 11/29/2021           |  |     | 500,000   |  |      |   | 495,000   |       | 
|Pregis
    Corporation, Senior Secured Third Amendment Refinancing Term Loan (First Lien), 4.50% (Libor + 4.00%), maturity 7/31/26 |  | 12/9/2020            |  |     | 498,750   |  |      |   | 496,681   |       | 
|Applied
    Adhesives, Senior Secured Revolving Loan, 5.75% (Libor + 5.00%), maturity 3/12/27                                      |  | 3/12/2021            |  |     | 7,111     |  |      |   | 6,400     |       | 





84







Audax Credit BDC Inc.

Schedules of Investments (Continued)

As of December 31, 2021

(Expressed in U.S. Dollars)





|Portfolio Investments (a) (b) (c) (d) (e) (f)                                                                                       |  | Acquisition Date |  | Par |           |  | Cost |   |           | Value | 
|----------------------------------------------------------------------------------------------------------------------------------- |  | ---------------- |  | --- | --------- |  | ---- | - | --------- | ----- | 
|BANK LOANS: NON-CONTROL/NON-AFFILIATE INVESTMENTS(h)(Continued):                                                                    |  |                  |  |     |           |  |      |   |           |       | 
|                                                                                                                                    |  |                  |  |     |           |  |      |   |           |       | 
|Banking, Finance, Insurance & Real Estate                                                                                           |  |                  |  |     |           |  |      |   |           |       | 
|Confluence, Senior Secured Initial Term Loan (First Lien), 4.25% (Libor + 3.75%), maturity 7/31/28 (i) (j)                          |  | 7/22/2021        |  | $   | 4,000,000 |  |      | $ | 3,980,000 |       | 
|Ascensus, Senior Secured Initial Term Loan (First Lien), 4.00% (Libor + 3.50%), maturity 8/2/28 (i)                                 |  | 11/17/2021       |  |     | 3,000,000 |  |      |   | 2,985,000 |       | 
|AmeriLife, Senior Secured Initial Term Loan (First Lien), 4.21% (Libor + 4.00%), maturity 3/18/27 (i)                               |  | 2/6/2020         |  |     | 2,462,828 |  |      |   | 2,449,570 |       | 
|Newport Group, Senior Secured Initial Term Loan (First Lien), 3.71% (Libor + 3.50%), maturity 9/12/25 (i)                           |  | 8/9/2018         |  |     | 2,421,181 |  |      |   | 2,412,499 |       | 
|American Beacon Advisors, Senior Secured Tranche D Term Loan (Second Lien), 9.00% (Libor + 8.00%), maturity 4/30/25                 |  | 10/31/2017       |  |     | 2,117,133 |  |      |   | 2,122,175 |       | 
|Kestra Financial, Senior Secured Initial Term Loan, 4.46% (Libor + 4.25%), maturity 6/3/26 (i)                                      |  | 4/29/2019        |  |     | 1,955,000 |  |      |   | 1,941,773 |       | 
|Integro Insurance Brokers, Senior Secured Initial Term Loan (First Lien), 6.75% (Libor + 5.75%), maturity 10/31/22                  |  | 10/9/2015        |  |     | 1,930,484 |  |      |   | 1,932,912 |       | 
|EPIC Insurance, Unitranche, 6.00% (Libor + 5.25%), maturity 9/29/28                                                                 |  | 8/27/2021        |  |     | 1,599,440 |  |      |   | 1,568,405 |       | 
|Orion, Senior Secured 2021 Refinancing Term Loan (First Lien), 4.50% (Libor + 3.75%), maturity 9/24/27 (i)                          |  | 8/4/2020         |  |     | 1,485,028 |  |      |   | 1,470,028 |       | 
|SIAA, Unitranche, 7.25% (Libor + 6.25%), maturity 4/28/28                                                                           |  | 4/21/2021        |  |     | 1,172,517 |  |      |   | 1,152,547 |       | 
|Advisor Group, Senior Secured Term B-1 Loan, 4.71% (Libor + 4.50%), maturity 7/31/26 (i)                                            |  | 1/31/2020        |  |     | 1,029,433 |  |      |   | 1,025,199 |       | 
|LERETA, Senior Secured Initial Term Loan, 6.00% (Libor + 5.25%), maturity 7/30/28 (i)                                               |  | 7/27/2021        |  |     | 997,500   |  |      |   | 987,500   |       | 
|Community Brands, Senior Secured Initial Term Loan (First Lien), 5.00% (Libor + 4.00%), maturity 12/2/22                            |  | 5/2/2018         |  |     | 817,262   |  |      |   | 815,063   |       | 
|Sedgwick Claims, Senior Secured Initial Term Loan, 3.46% (Libor + 3.25%), maturity 12/31/25 (i)                                     |  | 2/12/2020        |  |     | 489,899   |  |      |   | 489,422   |       | 
|                                                                                                                                    |  |                  |  |     |           |  |      |   |           |       | 
|Chemicals, Plastics & Rubber                                                                                                        |  |                  |  |     |           |  |      |   |           |       | 
|DuBois Chemicals, Senior Secured Term Loan (Second Lien) - 2019, 8.71% (Libor + 8.50%), maturity 9/30/27                            |  | 10/8/2019        |  |     | 3,000,000 |  |      |   | 2,975,353 |       | 
|Vertellus, Senior Secured Initial Term Loan, 7.00% (Libor + 6.00%), maturity 12/22/27                                               |  | 12/18/2020       |  |     | 2,977,500 |  |      |   | 2,905,500 |       | 
|Spectrum Plastics, Senior Secured Closing Date Term Loan (First Lien), 4.25% (Libor + 3.25%), maturity 1/31/25 (i)                  |  | 1/26/2018        |  |     | 2,627,625 |  |      |   | 2,633,804 |       | 
|Unifrax, Senior Secured USD Term Loan (First Lien), 3.96% (Libor + 3.75%), maturity 12/12/25 (i)                                    |  | 11/5/2018        |  |     | 2,426,216 |  |      |   | 2,407,584 |       | 
|Boyd Corp, Senior Secured Initial Loan (Second Lien), 6.96% (Libor + 6.75%), maturity 9/6/26 (i)                                    |  | 8/16/2018        |  |     | 2,000,000 |  |      |   | 2,001,674 |       | 
|USALCO, Senior Secured Term Loan A, 7.00% (Libor + 6.00%), maturity 10/19/27                                                        |  | 10/26/2021       |  |     | 2,000,000 |  |      |   | 1,980,000 |       | 
|Meridian Adhesives Group, Senior Secured Initial Term Loan, 4.75% (Libor + 4.00%), maturity 7/24/28                                 |  | 7/16/2021        |  |     | 2,000,000 |  |      |   | 1,980,300 |       | 
|Q Holding, Senior Secured Term B Loan (2019), 6.00% (Libor + 5.00%), maturity 12/29/23                                              |  | 8/20/2019        |  |     | 1,955,000 |  |      |   | 1,948,615 |       | 
|DuBois Chemicals, Senior Secured Term Loan B (First Lien), 4.71% (Libor + 4.50%), maturity 9/30/26                                  |  | 10/8/2019        |  |     | 1,777,250 |  |      |   | 1,745,650 |       | 
|Prince Minerals, Senior Secured Initial Term Loan (First Lien), 4.50% (Libor + 3.50%), maturity 3/31/25 (i)                         |  | 3/22/2018        |  |     | 962,500   |  |      |   | 959,965   |       | 
|Vantage Specialty Chemicals, Senior Secured Closing Date Term Loan (First Lien), 4.50% (Libor + 3.50%), maturity 10/28/24 (i)       |  | 11/30/2018       |  |     | 967,254   |  |      |   | 956,813   |       | 
|Polytek, Senior Secured Term Loan, 5.75% (Libor + 4.75%), maturity 9/20/24                                                          |  | 12/23/2020       |  |     | 495,081   |  |      |   | 490,381   |       | 
|Ascensus Specialties, Senior Secured Initial Term Loan, 5.00% (Libor + 4.25%), maturity 6/30/28 (i)                                 |  | 12/3/2021        |  |     | 498,744   |  |      |   | 488,744   |       | 
|Boyd Corp, Senior Secured Initial Term Loan (First Lien), 3.71% (Libor + 3.50%), maturity 9/6/25 (i)                                |  | 11/7/2018        |  |     | 492,366   |  |      |   | 465,615   |       | 
|Vertellus, Senior Secured Revolving Credit Loan, 7.00% (Libor + 6.00%), maturity 12/22/25                                           |  | 12/18/2020       |  |     | 106,972   |  |      |   | 94,817    |       | 
|USALCO, Senior Secured Revolving Loan, 7.00% (Libor + 6.00%), maturity 10/19/26                                                     |  | 10/26/2021       |  |     | 24,194    |  |      |   | 20,968    |       | 
|                                                                                                                                    |  |                  |  |     |           |  |      |   |           |       | 
|Aerospace & Defense                                                                                                                 |  |                  |  |     |           |  |      |   |           |       | 
|CPI International, Senior Secured Second Amendment Incremental Term Loan (First Lien), 5.75% (Libor + 4.75%), maturity 7/26/24      |  | 10/1/2019        |  |     | 5,222,307 |  |      |   | 5,181,858 |       | 
|HDT Global, Senior Secured Initial Term Loan, 6.50% (Libor + 5.75%), maturity 7/8/27                                                |  | 6/30/2021        |  |     | 3,412,500 |  |      |   | 3,307,500 |       | 
|StandardAero, Senior Secured 2020 Term B-1 Loan, 3.71% (Libor + 3.50%), maturity 4/6/26 (i)                                         |  | 1/24/2019        |  |     | 3,271,155 |  |      |   | 3,264,358 |       | 
|Consolidated Precision Products, Senior Secured Initial Term Loan (Second Lien), 8.75% (Libor + 7.75%), maturity 4/30/26            |  | 5/10/2018        |  |     | 2,000,000 |  |      |   | 2,007,007 |       | 
|Whitcraft, Unitranche, 7.00% (Libor + 6.00%), maturity 4/3/23                                                                       |  | 3/6/2020         |  |     | 1,962,398 |  |      |   | 1,954,769 |       | 
|StandardAero, Senior Secured 2020 Term B-2 Loan, 3.71% (Libor + 3.50%), maturity 4/6/26 (i)                                         |  | 1/24/2019        |  |     | 1,758,685 |  |      |   | 1,755,031 |       | 
|Tronair, Senior Secured Initial Term Loan (First Lien), 6.75% (Libor + 5.75%) cash, 0.50% PIK, maturity 9/8/23                      |  | 9/30/2016        |  |     | 1,372,158 |  |      |   | 1,369,408 |       | 
|Peraton, Senior Secured Term B Loan (First Lien), 4.50% (Libor + 3.75%), maturity 2/1/28 (i)                                        |  | 2/23/2021        |  |     | 992,500   |  |      |   | 988,100   |       | 
|Amentum, Senior Secured Tranche 2 Term Loan (First Lien), 5.50% (Libor + 4.75%), maturity 1/29/27 (i)                               |  | 10/29/2020       |  |     | 992,500   |  |      |   | 975,947   |       | 
|Amentum, Senior Secured Tranche 1 Term Loan (First Lien), 3.71% (Libor + 3.50%), maturity 1/29/27 (i)                               |  | 1/24/2020        |  |     | 985,000   |  |      |   | 960,031   |       | 
|API Technologies, Senior Secured Initial Term Loan (First Lien), 4.46% (Libor + 4.25%), maturity 5/9/26                             |  | 1/15/2020        |  |     | 979,900   |  |      |   | 956,544   |       | 
|BlueHalo, Unitranche, 7.00% (Libor + 6.00%), maturity 10/31/25                                                                      |  | 11/17/2021       |  |     | 499,027   |  |      |   | 491,527   |       | 
|Consolidated Precision Products, Senior Secured Initial Term Loan (First Lien), 4.75% (Libor + 3.75%), maturity 4/30/25 (i)         |  | 7/18/2019        |  |     | 487,900   |  |      |   | 486,144   |       | 
|Novaria Group, Senior Secured Initial Term Loan, 6.50% (Libor + 5.50%), maturity 1/27/27                                            |  | 1/24/2020        |  |     | 481,818   |  |      |   | 477,971   |       | 
|BlueHalo, Senior Secured Revolving Loan, 7.00% (Libor + 6.00%), maturity 10/31/25                                                   |  | 11/17/2021       |  |     | 25,305    |  |      |   | 23,815    |       | 
|                                                                                                                                    |  |                  |  |     |           |  |      |   |           |       | 
|Capital Equipment                                                                                                                   |  |                  |  |     |           |  |      |   |           |       | 
|FloWorks, Senior Secured Initial Term Loan (First Lien), 5.50% (Libor + 5.00%), maturity 12/27/28 (i)                               |  | 12/27/2021       |  |     | 4,000,000 |  |      |   | 3,850,000 |       | 
|Plaskolite, Senior Secured 2021-1 Refinancing Term Loan (First Lien), 4.75% (Libor + 4.00%), maturity 12/15/25 (i)                  |  | 12/12/2018       |  |     | 3,880,675 |  |      |   | 3,836,318 |       | 
|MW Industries, Senior Secured 2018 New Term Loan (First Lien), 3.96% (Libor + 3.75%), maturity 9/30/24 (i)                          |  | 4/20/2018        |  |     | 2,037,185 |  |      |   | 2,037,185 |       | 
|Excelitas, Senior Secured Initial Term Loan (Second Lien), 8.50% (Libor + 7.50%), maturity 12/1/25 (i)                              |  | 2/19/2020        |  |     | 1,500,000 |  |      |   | 1,482,834 |       | 
|Edward Don, Senior Secured Initial Term Loan, 5.25% (Libor + 4.25%), maturity 7/2/25                                                |  | 6/26/2018        |  |     | 1,370,943 |  |      |   | 1,367,973 |       | 
|Flow Control Group, Senior Secured Initial Term Loan (First Lien), 4.25% (Libor + 3.75%), maturity 3/31/28 (i)                      |  | 3/17/2021        |  |     | 1,184,544 |  |      |   | 1,181,906 |       | 
|TriMark, Senior Secured Initial Term Loan (First Lien), 3.71% (Libor + 3.50%), maturity 8/28/24                                     |  | 6/13/2018        |  |     | 973,447   |  |      |   | 902,470   |       | 
|Culligan, Senior Secured Initial Term B Loan, 4.50% (Libor + 4.00%), maturity 7/31/28 (i)                                           |  | 6/17/2021        |  |     | 500,000   |  |      |   | 497,500   |       | 
|Restaurant Technologies, Senior Secured Initial Loan (Second Lien), 6.71% (Libor + 6.50%), maturity 10/1/26                         |  | 2/11/2020        |  |     | 500,000   |  |      |   | 503,008   |       | 
|Infinite Electronics, Senior Secured Initial Term Loan (First Lien), 4.25% (Libor + 3.75%), maturity 3/2/28 (i)                     |  | 2/24/2021        |  |     | 497,500   |  |      |   | 496,400   |       | 
|Duravant, Senior Secured Incremental Amendment No. 5 Term Loan (First Lien), 4.50% (Libor + 3.75%), maturity 5/19/28 (i)            |  | 3/5/2020         |  |     | 492,424   |  |      |   | 492,424   |       | 
|Excelitas, Senior Secured Initial USD Term Loan (First Lien), 4.50% (Libor + 3.50%), maturity 12/2/24 (i)                           |  | 10/24/2018       |  |     | 483,627   |  |      |   | 486,011   |       | 
|Flow Control Group, Senior Secured Amendment No. 1 Delayed Draw Term Loan (First Lien), 4.25% (Libor + 3.75%), maturity 3/31/28 (i) |  | 7/27/2021        |  |     | 421,493   |  |      |   | 420,243   |       | 





85







Audax Credit BDC Inc.

Schedules of Investments (Continued)

As of December 31, 2021

(Expressed in U.S. Dollars)





|Portfolio Investments (a) (b) (c) (d) (e) (f)                                                                                  |  | Acquisition Date |  | Par |           |  | Cost |   |           | Value | 
|------------------------------------------------------------------------------------------------------------------------------ |  | ---------------- |  | --- | --------- |  | ---- | - | --------- | ----- | 
|BANK LOANS: NON-CONTROL/NON-AFFILIATE INVESTMENTS(h)(Continued):                                                               |  |                  |  |     |           |  |      |   |           |       | 
|                                                                                                                               |  |                  |  |     |           |  |      |   |           |       | 
|Services: Consumer                                                                                                             |  |                  |  |     |           |  |      |   |           |       | 
|A Place For Mom, Senior Secured Term Loan, 4.75% (Libor + 3.75%), maturity 2/10/26                                             |  | 7/28/2017        |  | $   | 2,611,593 |  |      | $ | 2,611,369 |       | 
|Weld North, Senior Secured 2021 Term Loan, 4.75% (Libor + 3.75%), maturity 12/21/27 (i)                                        |  | 12/21/2020       |  |     | 2,420,419 |  |      |   | 2,420,419 |       | 
|Smart Start, Senior Secured Term B Loan (First Lien), 5.00% (Libor + 4.50%), maturity 12/16/28 (i)                             |  | 12/10/2021       |  |     | 2,000,000 |  |      |   | 1,980,000 |       | 
|Smart Start, Senior Secured Term B Loan (Second Lien), 8.25% (Libor + 7.75%), maturity 12/16/29 (i)                            |  | 12/10/2021       |  |     | 2,000,000 |  |      |   | 1,960,000 |       | 
|Mister Car Wash, Senior Secured Initial Term Loan (First Lien), 3.21% (Libor + 3.00%), maturity 5/14/26 (i)                    |  | 5/8/2019         |  |     | 1,532,172 |  |      |   | 1,529,857 |       | 
|FullBloom, Senior Secured Initial Term Loan (First Lien), 5.00% (Libor + 4.25%), maturity 12/15/28 (i)                         |  | 12/10/2021       |  |     | 1,500,000 |  |      |   | 1,485,000 |       | 
|Ned Stevens, Senior Secured Term A Loan, 6.50% (Libor + 5.50%), maturity 9/30/25 (k)                                           |  | 9/30/2019        |  |     | 1,405,229 |  |      |   | 1,388,225 |       | 
|Teaching Strategies, Senior Secured Initial Term Loan (First Lien), 4.75% (Libor + 4.25%), maturity 8/31/28                    |  | 8/19/2021        |  |     | 1,000,000 |  |      |   | 990,060   |       | 
|Spring Education, Senior Secured Initial Term Loan (First Lien), 4.46% (Libor + 4.25%), maturity 7/30/25 (i)                   |  | 7/26/2018        |  |     | 967,500   |  |      |   | 966,117   |       | 
|Aegis Sciences, Senior Secured Initial Term Loan (2018) (First Lien), 6.50% (Libor + 5.50%), maturity 5/9/25 (i)               |  | 5/4/2018         |  |     | 718,618   |  |      |   | 712,798   |       | 
|Ned Stevens, Senior Secured Revolving Loan, 6.50% (Libor + 5.50%), maturity 9/30/25 (k)                                        |  | 9/30/2019        |  |     | -         |  |      |   | (2,614    | )     | 
|                                                                                                                               |  |                  |  |     |           |  |      |   |           |       | 
|Transportation: Cargo                                                                                                          |  |                  |  |     |           |  |      |   |           |       | 
|Evans Network, Senior Secured Initial Term Loan (First Lien), 5.00% (Libor + 4.25%), maturity 8/19/28 (i)                      |  | 8/6/2021         |  |     | 3,664,286 |  |      |   | 3,624,286 |       | 
|Odyssey Logistics & Technology , Senior Secured New Term Loan (First Lien), 5.00% (Libor + 4.00%), maturity 10/12/24 (i)       |  | 11/20/2018       |  |     | 3,571,843 |  |      |   | 3,569,083 |       | 
|Capstone Logistics, Senior Secured Closing Date Term Loan (First Lien), 5.75% (Libor + 4.75%), maturity 11/12/27               |  | 11/12/2020       |  |     | 2,117,015 |  |      |   | 2,097,983 |       | 
|AIT Worldwide Logistics, Senior Secured Initial Term Loan (First Lien), 5.50% (Libor + 4.75%), maturity 4/6/28 (i)             |  | 12/9/2021        |  |     | 1,995,000 |  |      |   | 1,990,013 |       | 
|Worldwide Express, Senior Secured Initial Term Loan (First Lien), 5.00% (Libor + 4.25%), maturity 7/26/28 (i)                  |  | 7/23/2021        |  |     | 1,500,000 |  |      |   | 1,488,750 |       | 
|Omni Logistics, Senior Secured Term Loan (First Lien), 6.00% (Libor + 5.00%), maturity 12/30/26                                |  | 11/24/2021       |  |     | 1,109,719 |  |      |   | 1,098,000 |       | 
|Omni Logistics, Senior Secured Revolving Credit Loan (First Lien), 6.00% (Libor + 5.00%), maturity 12/30/25                    |  | 11/24/2021       |  |     | 28,459    |  |      |   | 27,320    |       | 
|                                                                                                                               |  |                  |  |     |           |  |      |   |           |       | 
|Beverage, Food & Tobacco                                                                                                       |  |                  |  |     |           |  |      |   |           |       | 
|Bettcher Industries, Senior Secured Initial Term Loan (Second Lien), 7.75% (Libor + 7.25%), maturity 12/14/29 (i)              |  | 12/13/2021       |  |     | 2,500,000 |  |      |   | 2,475,000 |       | 
|Sovos Brands, Senior Secured Initial Term Loan (First Lien), 4.50% (Libor + 3.75%), maturity 6/8/28 (i)                        |  | 6/8/2021         |  |     | 2,033,001 |  |      |   | 2,033,001 |       | 
|Bettcher Industries, Senior Secured Initial Term Loan (First Lien), 4.50% (Libor + 4.00%), maturity 12/14/28 (i)               |  | 12/13/2021       |  |     | 2,000,000 |  |      |   | 1,980,000 |       | 
|Kettle Cuisine, Senior Secured Initial Term Loan (First Lien), 4.75% (Libor + 3.75%), maturity 8/25/25                         |  | 8/22/2018        |  |     | 1,935,000 |  |      |   | 1,930,127 |       | 
|Dessert Holdings, Senior Secured Initial Term Loan (First Lien), 4.75% (Libor + 4.00%), maturity 6/9/28                        |  | 6/7/2021         |  |     | 1,496,250 |  |      |   | 1,485,300 |       | 
|Monogram Foods, Senior Secured Cov-Lite Term Loan B, 4.50% (Libor + 4.00%), maturity 8/28/28                                   |  | 8/13/2021        |  |     | 1,000,000 |  |      |   | 990,000   |       | 
|                                                                                                                               |  |                  |  |     |           |  |      |   |           |       | 
|Automotive                                                                                                                     |  |                  |  |     |           |  |      |   |           |       | 
|Highline, Senior Secured Initial Term Loan (First Lien), 5.25% (Libor + 4.50%), maturity 11/9/27 (i)                           |  | 10/29/2020       |  |     | 2,842,159 |  |      |   | 2,776,983 |       | 
|Rough Country, Senior Secured Initial Term Loan (First Lien), 4.25% (Libor + 3.50%), maturity 7/28/28 (i)                      |  | 7/26/2021        |  |     | 1,995,000 |  |      |   | 1,990,000 |       | 
|Truck Hero, Senior Secured Initial Term Loan, 4.00% (Libor + 3.25%), maturity 1/31/28 (i)                                      |  | 1/20/2021        |  |     | 1,488,750 |  |      |   | 1,488,750 |       | 
|Safe Fleet, Senior Secured Tranche B-1 Term Loan (First Lien), 4.75% (Libor + 3.75%), maturity 2/3/25                          |  | 11/28/2018       |  |     | 967,500   |  |      |   | 950,885   |       | 
|IXS, Senior Secured Initial Term Loan, 5.00% (Libor + 4.25%), maturity 3/5/27 (i)                                              |  | 2/27/2020        |  |     | 794,417   |  |      |   | 792,552   |       | 
|Wheel Pros, Senior Secured Initial Term Loan (First Lien), 5.25% (Libor + 4.50%), maturity 5/11/28 (i)                         |  | 4/23/2021        |  |     | 498,750   |  |      |   | 494,350   |       | 
|Safe Fleet, Senior Secured Initial Term Loan (Second Lien), 7.75% (Libor + 6.75%), maturity 2/2/26                             |  | 2/7/2020         |  |     | 500,000   |  |      |   | 491,417   |       | 
|                                                                                                                               |  |                  |  |     |           |  |      |   |           |       | 
|Construction & Building                                                                                                        |  |                  |  |     |           |  |      |   |           |       | 
|Tangent, Senior Secured Closing Date Term Loan (First Lien), 4.96% (Libor + 4.75%), maturity 11/30/24 (i)                      |  | 10/2/2019        |  |     | 1,792,819 |  |      |   | 1,783,355 |       | 
|PlayPower, Senior Secured Initial Term Loan, 5.71% (Libor + 5.50%), maturity 5/8/26                                            |  | 5/10/2019        |  |     | 1,756,917 |  |      |   | 1,756,917 |       | 
|PlayCore, Senior Secured Initial Term Loan (Second Lien), 8.75% (Libor + 7.75%), maturity 9/29/25                              |  | 2/7/2020         |  |     | 1,500,000 |  |      |   | 1,475,188 |       | 
|PlayCore, Senior Secured Initial Term Loan (First Lien), 4.75% (Libor + 3.75%), maturity 9/30/24 (i)                           |  | 9/18/2017        |  |     | 956,924   |  |      |   | 955,673   |       | 
|CHI Overhead Doors, Senior Secured Third Amendment Initial Term Loan (First Lien), 4.50% (Libor + 3.50%), maturity 7/31/25 (i) |  | 7/28/2015        |  |     | 615,739   |  |      |   | 617,179   |       | 
|Acuren, Senior Secured Initial Term Loan, 4.21% (Libor + 4.00%), maturity 1/23/27                                              |  | 1/17/2020        |  |     | 479,011   |  |      |   | 477,104   |       | 
|Hoffman Southwest, Senior Secured Initial Term Loan, 6.50% (Libor + 5.50%), maturity 8/14/23                                   |  | 5/16/2019        |  |     | 446,460   |  |      |   | 446,911   |       | 
|                                                                                                                               |  |                  |  |     |           |  |      |   |           |       | 
|Wholesale                                                                                                                      |  |                  |  |     |           |  |      |   |           |       | 
|Carlisle FoodService, Senior Secured Initial Term Loan (First Lien), 4.00% (Libor + 3.00%), maturity 3/20/25                   |  | 3/16/2018        |  |     | 3,849,619 |  |      |   | 3,850,157 |       | 
|PetroChoice, Senior Secured Initial Term Loan (First Lien), 6.00% (Libor + 5.00%), maturity 8/19/22                            |  | 9/2/2015         |  |     | 1,875,184 |  |      |   | 1,869,627 |       | 
|ABB Optical, Senior Secured Initial Term Loan (First Lien), 6.00% (Libor + 5.00%), maturity 6/15/23                            |  | 6/14/2016        |  |     | 1,424,830 |  |      |   | 1,425,559 |       | 
|                                                                                                                               |  |                  |  |     |           |  |      |   |           |       | 
|Hotels, Gaming & Leisure                                                                                                       |  |                  |  |     |           |  |      |   |           |       | 
|Aimbridge, Senior Secured Initial Term Loan (2019) (First Lien), 3.96% (Libor + 3.75%), maturity 2/2/26 (i)                    |  | 1/17/2019        |  |     | 2,922,725 |  |      |   | 2,915,974 |       | 
|Northstar, Senior Secured Term Loan, 6.75% (Libor + 6.25%) cash, 1.00% PIK, maturity 6/7/24                                    |  | 5/8/2017         |  |     | 1,366,260 |  |      |   | 1,366,260 |       | 
|Auto Europe, Senior Secured Initial Dollar Term Loan, 6.00% (Libor + 5.00%), maturity 10/21/23                                 |  | 10/19/2016       |  |     | 1,119,231 |  |      |   | 1,115,110 |       | 
|                                                                                                                               |  |                  |  |     |           |  |      |   |           |       | 
|Consumer Goods: Non-durable                                                                                                    |  |                  |  |     |           |  |      |   |           |       | 
|Hoffmaster Group, Senior Secured Tranche B-1 Term Loan (First Lien), 5.00% (Libor + 4.00%), maturity 11/21/23 (i)              |  | 11/9/2016        |  |     | 2,393,770 |  |      |   | 2,389,338 |       | 
|Augusta Sportswear Group, Senior Secured Initial Term Loan, 5.50% (Libor + 4.50%), maturity 10/26/23 (j)                       |  | 11/2/2016        |  |     | 2,029,843 |  |      |   | 2,023,255 |       | 
|Badger Sportswear, Senior Secured Initial Term Loan (First Lien), 5.75% (Libor + 4.50%), maturity 9/11/23                      |  | 9/29/2016        |  |     | 1,881,139 |  |      |   | 1,875,639 |       | 
|Hoffmaster Group, Senior Secured Initial Term Loan (Second Lien), 10.50% (Libor + 9.50%), maturity 11/21/24                    |  | 2/7/2020         |  |     | 1,250,000 |  |      |   | 1,250,000 |       | 





86







Audax Credit BDC Inc.

Schedules of Investments (Continued)

As of December 31, 2021

(Expressed in U.S. Dollars)



|Portfolio Investments (a) (b) (c) (d) (e) (f)                                                                 |  | Acquisition Date |  | Par |           |  | Cost |   |             | Value | 
|------------------------------------------------------------------------------------------------------------- |  | ---------------- |  | --- | --------- |  | ---- | - | ----------- | ----- | 
|BANK LOANS: NON-CONTROL/NON-AFFILIATE INVESTMENTS(h)(Continued):                                              |  |                  |  |     |           |  |      |   |             |       | 
|                                                                                                              |  |                  |  |     |           |  |      |   |             |       | 
|Media: Diversified & Production                                                                               |  |                  |  |     |           |  |      |   |             |       | 
|Cast & Crew, Senior Secured Initial Term Loan (First Lien), 3.71% (Libor + 3.50%), maturity 2/9/26 (i)        |  | 1/16/2019        |  | $   | 2,924,905 |  |      | $ | 2,909,965   |       | 
|                                                                                                              |  |                  |  |     |           |  |      |   |             |       | 
|Environmental Industries                                                                                      |  |                  |  |     |           |  |      |   |             |       | 
|Denali Water Solutions, Senior Secured Closing Date Term Loan, 5.00% (Libor + 4.25%), maturity 3/27/28        |  | 3/18/2021        |  |     | 1,990,000 |  |      |   | 1,970,000   |       | 
|Keter Environmental Services, Unitranche, 7.50% (Libor + 6.50%), maturity 10/29/27 (i)                        |  | 11/5/2021        |  |     | 500,000   |  |      |   | 495,000     |       | 
|Keter Environmental Services, Unitranche, 7.50% (Libor + 6.50%), maturity 10/29/27 (i)                        |  | 11/5/2021        |  |     | 4,560     |  |      |   | 4,514       |       | 
|                                                                                                              |  |                  |  |     |           |  |      |   |             |       | 
|Metals & Mining                                                                                               |  |                  |  |     |           |  |      |   |             |       | 
|Dynatect, Senior Secured Term B Loan, 5.50% (Libor + 4.50%), maturity 9/30/22 (i)                             |  | 8/16/2019        |  |     | 1,937,063 |  |      |   | 1,926,533   |       | 
|                                                                                                              |  |                  |  |     |           |  |      |   |             |       | 
|Utilities: Electric                                                                                           |  |                  |  |     |           |  |      |   |             |       | 
|Systems Control, Senior Secured Initial Term Loan, 5.75% (Libor + 4.75%), maturity 3/28/25                    |  | 6/15/2021        |  |     | 1,490,973 |  |      |   | 1,488,636   |       | 
|                                                                                                              |  |                  |  |     |           |  |      |   |             |       | 
|Forest Products & Paper                                                                                       |  |                  |  |     |           |  |      |   |             |       | 
|Loparex, Senior Secured Initial Term Loan (First Lien), 4.71% (Libor + 4.50%), maturity 7/31/26               |  | 7/29/2019        |  |     | 1,466,250 |  |      |   | 1,455,917   |       | 
|                                                                                                              |  |                  |  |     |           |  |      |   |             |       | 
|Retail                                                                                                        |  |                  |  |     |           |  |      |   |             |       | 
|Varsity Brands, Senior Secured Initial Term Loan (First Lien), 4.50% (Libor + 3.50%), maturity 12/16/24 (i)   |  | 10/17/2018       |  |     | 967,287   |  |      |   | 971,481     |       | 
|StubHub, Senior Secured USD Term B Loan, 3.71% (Libor + 3.50%), maturity 2/12/27 (i)                          |  | 1/31/2020        |  |     | 490,000   |  |      |   | 488,093     |       | 
|                                                                                                              |  |                  |  |     |           |  |      |   |             |       | 
|Media: Advertising, Printing & Publishing                                                                     |  |                  |  |     |           |  |      |   |             |       | 
|Ansira, Unitranche, 7.50% (Libor + 6.50%) PIK, maturity 12/20/24                                              |  | 12/20/2016       |  |     | 2,171,946 |  |      |   | 2,166,066   |       | 
|                                                                                                              |  |                  |  |     |           |  |      |   |             |       | 
|Utilities: Water                                                                                              |  |                  |  |     |           |  |      |   |             |       | 
|Aegion, Senior Secured Initial Term Loan, 5.50% (Libor + 4.75%), maturity 5/17/28                             |  | 4/1/2021         |  |     | 997,500   |  |      |   | 992,800     |       | 
|                                                                                                              |  |                  |  |     |           |  |      |   |             |       | 
|Energy: Electricity                                                                                           |  |                  |  |     |           |  |      |   |             |       | 
|Franklin Energy, Senior Secured Term B Loan (First Lien), 4.21% (Libor + 4.00%), maturity 8/14/26             |  | 8/14/2019        |  |     | 977,500   |  |      |   | 975,628     |       | 
|                                                                                                              |  |                  |  |     |           |  |      |   |             |       | 
|Consumer Goods: Durable                                                                                       |  |                  |  |     |           |  |      |   |             |       | 
|Careismatic Brands, Senior Secured Initial Term Loan (First Lien), 3.75% (Libor + 3.25%), maturity 1/6/28 (i) |  | 1/22/2021        |  |     | 497,500   |  |      |   | 496,400     |       | 
|Total Bank Loans                                                                                              |  |                  |  |     |           |  |      | $ | 403,106,122 |       | 
|                                                                                                              |  |                  |  |     |           |  |      |   |             |       | 
|EQUITY AND PREFERRED SHARES:  NON-CONTROL/NON-AFFILIATE INVESTMENTS- (0.4%)(g)(h):                            |  |                  |  |     |           |  |      |   |             |       | 
|                                                                                                              |  |                  |  |     |           |  |      |   |             |       | 
|High Tech Industries                                                                                          |  |                  |  |     |           |  |      |   |             |       | 
|PracticeTek, Class A Units (318,350 Class A Units)(k)(l)(o)                                                   |  | 11/22/2021       |  |     |           |  |      | $ | 348,282     |       | 
|                                                                                                              |  |                  |  |     |           |  |      |   |             |       | 
|Services: Business                                                                                            |  |                  |  |     |           |  |      |   |             |       | 
|Alliance Environmental Group, A-1 Preferred Units (331,126 A-1 Preferred Units)(k)(l)(p)                      |  | 12/30/2021       |  |     |           |  |      |   | 331,126     |       | 
|                                                                                                              |  |                  |  |     |           |  |      |   |             |       | 
|Services: Consumer                                                                                            |  |                  |  |     |           |  |      |   |             |       | 
|Ned Stevens, Class B Common Units (261,438 Common B Units)(k)(l)(q)(t)                                        |  | 9/30/2019        |  |     |           |  |      |   | 261,438     |       | 
|                                                                                                              |  |                  |  |     |           |  |      |   |             |       | 
|Healthcare & Pharmaceuticals                                                                                  |  |                  |  |     |           |  |      |   |             |       | 
|Alpaca, Class A Units (45,746 Class A Units)(k)(l)(r)(t)                                                      |  | 4/19/2019        |  |     |           |  |      |   | 80,512      |       | 
|                                                                                                              |  |                  |  |     |           |  |      |   |             |       | 
|Chemicals, Plastics & Rubber                                                                                  |  |                  |  |     |           |  |      |   |             |       | 
|Vertellus, Series A Units (1,651 Series A Units)(l)(m)(t)                                                     |  | 12/22/2020       |  |     |           |  |      |   | 165,138     |       | 
|                                                                                                              |  |                  |  |     |           |  |      |   |             |       | 
|Total Equity and Preferred Shares                                                                             |  |                  |  |     |           |  |      | $ | 1,186,496   |       | 
|                                                                                                              |  |                  |  |     |           |  |      |   |             |       | 
|Total Portfolio Investments(u)                                                                                |  |                  |  |     |           |  |      | $ | 404,292,618 |       | 



| | (a) | All
                                            companies are located in the United States of America, unless otherwise noted.
| | --- | ------------------------------------------------------------------------------------------------------------------------------

| | (b) | Interest
                                            rate percentages represent actual interest rates which are indexed from then 30-day London
                                            Interbank Offered Rate ("LIBOR") unless otherwise noted. LIBOR rates are subject
                                            to interest rate floors which can vary based on the contractual agreement with the borrower.  Due
                                            dates represent the contractual maturity date.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (c) | All
                                            loans are income-producing, unless otherwise noted.
| | --- | ---------------------------------------------------------------------------------------------------

| | (d) | All
                                            investments are qualifying assets under Section 55(a) of the Investment Company
                                            Act of 1940, as amended (the "1940 Act") unless otherwise noted.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (e) | All
                                            investments are exempt from registration under the Securities Act of 1933 (the “Securities
                                            Act”), and may be deemed to be “restricted securities” under the Securities
                                            Act.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (f) | Unless
                                            indicated otherwise, all of our investments are valued using Level 3 inputs within the FASB
                                            Accounting Standard Codification (“ASC”) Topic 820, “Fair Value Measurements
                                            and Disclosures” (“ASC 820”) fair value hierarchy. Refer to Note 3 –
                                            Investments in the accompanying Notes to Financial Statements for additional information.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (g) | Percentages
                                            are calculated using fair value of investments over net assets.
| | --- | -----------------------------------------------------------------------------------------------------------------------

| | (h) | As
                                            defined in 1940 Act, the Company is not deemed to be an “Affiliated Person” of
                                            or “Control” this portfolio company because it neither owns 5% or  more
                                            of the portfolio company’s outstanding voting securities nor has the power to exercise
                                            control over the management or policies of such portfolio company (including through a management
                                            agreement).
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (i) | Investment
                                            was valued using Level 2 inputs within the ASC 820 fair value hierarchy.  Refer
                                            to Note 3 – Investments in the accompanying Notes to Financial Statements for additional
                                            information.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (j) | All
                                            or portion of this security has an open position related to short-term borrowings, as described
                                            in footnote 8.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (k) | Three
                                            of our affiliated funds, Audax Direct Lending Solutions Fund - A, L.P., Audax Direct Lending
                                            Solutions Fund - C, L.P., and Audax Direct Lending Solutions Fund - D, L.P., "   'co-invested
                                            with us in this portfolio company pursuant to an exemptive order granted by the U.S. Securities
                                            and Exchange Commission.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (l) | Investment
                                            is non-income producing.
| | --- | -------------------------------------------------------------------------------

| | (m) | The
                                            borrower for UDG Healthcare, Congachant Limited, is located in Ireland.
| | --- | -----------------------------------------------------------------------------------------------------------------------

| | (n) | The
                                            borrower for Sophos, Surf Holdings S.a.r.l., is located in United Kingdom.
| | --- | --------------------------------------------------------------------------------------------------------------------------

| | (o) | Represents
                                            an investment in APD Ptek Equity, L.P., a holding company, made through an affiliated equity
                                            aggregator vehicle.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (p) | Represents
                                            an investment in APD AEG Equity Blocker, L.P., a holding company, made through an affiliated
                                            equity aggregator vehicle.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (q) | Represents
                                            an investment in APD NS Equity, L.P., a holding company, made through an affiliated equity
                                            aggregator vehicle.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (r) | Represents
                                            an investment in APD ALP Equity, L.P., a holding company, made through an affiliated equity
                                            aggregator vehicle.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (s) | Represents
                                            an investment in ADP VERT Equity, L.P., a holding company, made through an affiliated equity
                                            aggregator vehicle.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (t) | Other
                                            net assets of $0 at the aggregator levels are included in the fair value of the investments
                                            when using the net asset value as a practical expedient.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (u) | At
                                            December 31, 2021, the cost of investments for income tax purposes was $404,292,618,
                                            the gross unrealized depreciation for federal tax purposes was $3,278,981, the gross unrealized
                                            appreciation for federal income tax purposes was $2,040,737, and the net unrealized depreciation
                                            was $1,238,244.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



87







Note 1. Organization

Audax Credit BDC Inc. (the “Company”) is a Delaware
corporation that was formed on January 29, 2015. The Company is an externally managed, closed-end, 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”). In addition, effective with the Company’s taxable year ended December 31, 2015, the
Company has elected to be treated for federal income tax purposes and intends to comply with the requirements to qualify annually as
a regulated investment company (“RIC”) under Subchapter M of the U.S. Internal Revenue Code of 1986, as amended (the “Code”).



The Company commenced business operations on July 8,
2015, the date on which the Company made its first investment. The Company was formed for the purpose of investing primarily in the debt
of leveraged, non-investment grade middle market companies, with the principal objective of generating income and capital appreciation.
The Company’s investment strategy is to invest primarily in first lien senior secured loans and selectively in unitranche and second
lien loans to middle market companies.



Audax Management Company (NY), LLC (the “Adviser”)
is the investment adviser of the Company. The Adviser is registered as an investment adviser with the U.S. Securities and Exchange Commission
(the “SEC”) under the Investment Advisers Act of 1940, as amended.



Note 2. Significant Accounting Policies



Basis of Presentation

As an investment company, the accompanying financial statements
of the Company are prepared in accordance with the investment company accounting and reporting guidance of ASC Topic 946, “Financial
Services – Investment Companies,” as amended, which incorporates the requirements for reporting on Form 10-K and
Article 6 of Regulation S-X under the Securities Exchange Act of 1934, as amended, as well as accounting principles generally accepted
in the United States of America (“GAAP”). The accompanying financial statements and related notes present the results of
activity of the Company for the years ended December 31, 2022, 2021, and 2020.



Certain prior period information has been reclassified to
conform to the current period presentation. The reclassification has no effect on the Company’s financial position or the result
of operations as previously reported.



Use of Estimates

The preparation of financial statements in conformity with
GAAP requires management of the Company to make estimates and assumptions that may affect the reported amounts and disclosures in the
financial statements. Changes in the economic environment, financial markets and any other parameters used in determining these estimates
could cause actual results to differ and these differences could be material.



Cash and Cash Equivalents

Cash
and cash equivalents are stated at fair value. The Company considers all highly liquid investments purchased with maturities of three
months or less and money market mutual funds to be cash equivalents.No cash equivalent balances were held at December 31,
2022 and 2021. The cash was not subject to any restrictions on withdrawal.



Expenses

The Company is responsible for investment expenses, legal
expenses, auditing fees and other expenses related to the Company’s operations. Such fees and expenses, including expenses initially
incurred by the Adviser, may be reimbursed by the Company.



Investment Valuation Policy

The Company conducts the valuation of the Company’s
investments, pursuant to which the Company’s net asset value is determined, at all times consistent with GAAP and the 1940 Act.
The Company’s Board of Directors (the “Board of Directors”), with the assistance of the Company’s Audit Committee
(the “Audit Committee”), determines the fair value of the Company’s investments, for investments with a public market
and for investments with no readily available public market, on at least a quarterly basis, in accordance with the terms of ASC Topic
820, “Fair Value Measurement,” (“ASC 820”). The Company’s valuation procedures are set forth in
more detail below.





88







ASC 820 defines fair value 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.” Fair value is a market-based measurement, not an entity-specific measurement. For some assets and liabilities, observable
market transactions or market information might be available. For other assets and liabilities, observable market transactions and market
information might not be available. However, the objective of a fair value measurement in both cases is the same – to estimate
the price when an orderly transaction to sell the asset or transfer the liability would take place between market participants at the
measurement date under current market conditions (that is, an exit price at the measurement date from the perspective of a market participant
that holds the asset or owes the liability).



ASC 820 establishes a hierarchal disclosure framework which
ranks the observability of inputs used in measuring financial instruments at fair value. The observability of inputs is impacted by a
number of factors, including the type of financial instruments and their specific characteristics. Financial instruments with readily
available quoted prices, or for which fair value can be measured from quoted prices in active markets, generally will have a higher degree
of market price observability and a lesser degree of judgment applied in determining fair value.



The three-level hierarchy for fair value measurement is
defined as follows:



Level
1— Inputs to the valuation methodology are quoted prices available in active markets for identical financial instruments
as of the measurement date. The types of financial instruments in this category include unrestricted securities, including equities and
derivatives, listed in active markets. The Company does not adjust the quoted price for these instruments, even in situations where the
Company holds a large position, and a sale could reasonably be expected to impact the quoted price.



Level
2— Inputs to the valuation methodology are quoted prices in markets that are not active or for which all significant
inputs are either directly or indirectly observable as of the measurement date. The types of financial instruments in this category include
less liquid and restricted securities listed in active markets, securities traded in markets that are not active, government and agency
securities, and certain over-the-counter derivatives where the fair value is based on observable inputs.



Level
3— Inputs to the valuation methodology are unobservable and significant to the overall fair value measurement, and
include situations where there is little, if any, market activity for the investment. The inputs into the determination of fair value
require significant management judgment or estimation. The types of financial instruments in this category include investments in privately
held entities, non-investment grade residual interests in securitizations, collateralized loan obligations, and certain over-the-counter
derivatives where the fair value is based on unobservable inputs.



In certain cases, the inputs used to measure fair value
may fall into different levels of the fair value hierarchy. In such cases, the determination of which category within the fair value
hierarchy is appropriate for any given financial instrument is based on the lowest level of input that is significant to the fair value
measurement. Assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and
considers factors specific to the financial instrument.





89







Pursuant to the framework set forth above, the Company values
securities traded in active markets on the measurement date by multiplying the exchange closing price of such traded securities/instruments
by the quantity of shares or amount of the instrument held. The Company may also obtain quotes with respect to certain of its investments
from pricing services, brokers or dealers’ quotes, or counterparty marks in order to value liquid assets that are not traded in
active markets.



Pricing services aggregate, evaluate and report pricing
from a variety of sources including observed trades of identical or similar securities, broker or dealer quotes, model-based valuations
and internal fundamental analysis and research. When doing so, the Company determines whether the quote obtained is sufficient in accordance
with GAAP to determine the fair value of the security. If determined adequate, the Company uses the quote obtained.



Securities that are illiquid or for which the pricing source
does not provide a valuation or methodology or provides a valuation or methodology that, in the judgment of the Board of Directors, does
not represent fair value, are each valued as of the measurement date using all techniques appropriate under the circumstances and for
which sufficient data are available. These valuation techniques vary by investment but include comparable public market valuations, comparable
precedent transaction valuations and discounted cash flow analyses. Inputs for these valuation techniques include relative credit information,
observed market movement, industry sector information, and other market data, which may include benchmarking of comparable securities,
issuer spreads, reported trades, and reference data, such as market research publications, when available. The process used to determine
the applicable value is as follows:



(i) Each portfolio company or investment
is initially valued by the investment professionals of the Adviser responsible for the portfolio investment using a standardized template
designed to approximate fair market value based on observable market inputs and updated credit statistics and unobservable inputs. Additionally,
as a part of the Company’s valuation process, the Adviser may employ the services of one or more independent valuation firms engaged
by the Company;



(ii) Preliminary valuation conclusions
are documented and discussed with the Company’s senior management and members of the Adviser’s valuation team;



(iii) The Audit Committee reviews
the assessments of the Adviser or independent valuation firm (to the extent applicable) and provides the Board of Directors with recommendations
with respect to the fair value of the investments in the Company’s portfolio; and



(iv) The Board of Directors discusses
the valuation recommendations of the Audit Committee and determines the fair value of the investments in the Company’s portfolio
in good faith based on the input of the Adviser, the independent valuation firm (to the extent applicable) and in accordance with the
Company’s valuation policy.



The Audit Committee’s recommendation of fair value
is generally based on its assessment of the following factors, as relevant:



| | · | the
                                            nature and realizable value of any collateral;
| | - | ----------------------------------------------------------------------------------------------



| | · | call
                                            features, put features and other relevant terms of debt;
| | - | ---------------------------------------------------------------------------------------------------------



| | · | the
                                            portfolio company’s ability to make payments;
| | - | ---------------------------------------------------------------------------------------------



| | · | the
                                            portfolio company’s actual and expected earnings and discounted cash flow;
| | - | --------------------------------------------------------------------------------------------------------------------------



| | · | prevailing
                                            interest rates for like securities and expected volatility in future interest rates;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------





90







| | · | the
                                            markets in which the portfolio company does business and recent economic and/or market events;
                                            and
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | comparisons
                                            to publicly traded securities.
| | - | --------------------------------------------------------------------------------------



Investment performance data utilized are the most recently
available as of the measurement date, which in many cases may reflect up to a one quarter lag in information.



Securities for which market quotations are not readily available
or for which a pricing source is not sufficient may include the following:



| | · | private
                                            placements and restricted securities that do not have an active trading market;
| | - | -----------------------------------------------------------------------------------------------------------------------------------



| | · | securities
                                            whose trading has been suspended or for which market quotes are no longer available;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------



| | · | debt
                                            securities that have recently gone into default and for which there is no current market;
| | - | ------------------------------------------------------------------------------------------------------------------------------------------



| | · | securities
                                            whose prices are stale; and
| | - | ----------------------------------------------------------------------------------



| | · | securities
                                            affected by significant events.
| | - | --------------------------------------------------------------------------------------



The Board of Directors is responsible for the determination,
in good faith, of the fair value of the Company’s portfolio investments.



Determination of fair value involves subjective judgments
and estimates. Accordingly, these notes to the



Company’s financial statements express the uncertainty
with respect to the possible effect of such valuations, and any change in such valuations, on the Company’s financial statements.



Security transactions are recorded on the trade date (the
date the order to buy or sell is executed or, in the case of privately issued securities, the closing date, which is when all terms of
the transactions have been defined).



Realized gains and losses on investments are determined
based on the identified cost method.



In addition, on December 3, 2020, the SEC announced
that it adopted Rule 2a-5 under the 1940 Act, which establishes an updated regulatory framework for determining fair value in good
faith for purposes of the 1940 Act. The adopted rule clarifies how fund boards can satisfy their valuation obligations in light
of recent market developments. The rule permits boards, subject to board oversight and certain other conditions, to designate certain
parties to perform the fair value determinations.



Refer to Note 3 — Investments for additional
information regarding fair value measurements and the Company’s application of ASC 820.



Interest Income Recognition

Interest income, adjusted for amortization of premium, acquisition
costs, and amendment fees and the accretion of original issue discount (“OID”), are recorded on an accrual basis to the extent
that such amounts are expected to be collected. Generally, when a loan becomes 120 days or more past due, or if the Company’s qualitative
assessment indicates that the debtor is unable to service its debt or other obligations, the Company will place the loan on non-accrual
status and cease recognizing interest income on that loan for financial reporting purposes until the borrower has demonstrated the ability
and intent to pay contractual amounts due. However, the Company will remain contractually entitled to this interest. Interest payments
received on non-accrual loans are restored to accrual status when past due principal and interest are paid and, in management’s
judgment, are likely to remain current or, due to a restructuring, the interest income is deemed to be collectible. As of December 31,
2022, the Company had one investment on non-accrual, which represented 0.53% and 0.23% of its total portfolio at cost and fair market
value, respectively. As of December 31, 2021, the Company did not hold any investment on non-accrual.





91







The
Company currently holds loans in the portfolio that contain OID and payment-in-kind (“PIK”) provisions. The Company
recognizes OID for loans originally issued at a discount and recognizes the income over the life of the obligation based on an effective
yield calculation. PIK interest, computed at the contractual rate specified in a loan agreement, is added to the principal balance of
a loan and recorded as income over the life of the obligation. Therefore, the actual collection of PIK income may be deferred until the
time of debt principal repayment. To maintain the ability to be taxed as a RIC, the Company may need to pay out of both OID and PIK non-cash
income amounts in the form of distributions, even though the Company has not yet collected the cash on either.



As of December 31, 2022, the Company held 239 investments
in loans with OID. The Company accrued OID income of $691,243 for the year ended December 31, 2022. The unamortized balance of OID
investments as of December 31, 2022, totaled $4,510,014. As of December 31, 2021, the Company held 231 investments in loans
with OID. The Company accrued OID income of $438,390 for the year ended December 31, 2021. The unamortized balance of OID investments
as of December 31, 2021, totaled $3,028,962.



As of December 31, 2022, the Company held six investments
that had a PIK interest component. As of December 31, 2021, the Company held four investments that had a PIK interest component.
During the years ended December 31, 2022 and 2021, the Company accrued PIK income in the amount of $239,601 and $257,412, respectively.



As of December 31, 2022 and 2021, the Company held
$15,923,163 and $11,058,796 cash and cash equivalents, respectively. For the years ended December 31, 2022, 2021, and 2020, the
Company earned $44,174, $1,634, and $31,828, respectively, of interest income related to cash, which is included in other interest income
within the accompanying statement of operations.



Other Income Recognition

The Company generally records prepayment fees upon receipt
of cash or as soon as the Company becomes aware of the prepayment.



Dividend income on equity investments is accrued to the
extent that such amounts are expected to be collected and if the Company has the option to collect such amounts in cash.



Prepayment fees and dividend income are both accrued in
other income in the accompanying statements of operations.



The Company accrued $459,154 of other income for the year
ended December 31, 2022 related to amendment fees. The Company accrued $111,954 of other income for the year ended December 31,
2021 related to amendment fees. The Company accrued $223,136 of other income for the year ended December 31, 2020 related to amendment
fees.



New Accounting Pronouncements

In March 2020, FASB issued Accounting Standards Update
No. 2020-04 (“ASU 2020-04”), “Reference Rate Reform (Topic 848)”. In response to concerns about structural
risks of interbank offered rates, and particularly the risk of cessation of the London Interbank Offered Rate (“LIBOR”),
regulators have undertaken reference rate reform initiatives to identify alternative reference rates that are more observable or transaction
based and less susceptible to manipulation. ASU 2020-04 provides optional guidance for a limited period of time to ease the potential
burden in accounting for (or recognizing the effects of) reference rate reform on financial reporting. ASU 2020-04 is elective and applies
to all entities, subject to meeting certain criteria, that have contracts, hedging relationships, and other transactions that reference
LIBOR or another reference rate expected to be discontinued because of reference rate reform. The amendments are effective as of March 12,
2020 through December 31, 2024. Management is currently evaluating the impact of the guidance.





92







Note 3. Investments



Fair Value



In
accordance with ASC 820, the Company’s investments’ fair value is determined to be the price that would be received for an
investment in a current sale, assuming an orderly transaction between willing market participants on the measurement date. This fair
value definition focuses on exit price in the principal, or most advantageous, market and prioritizes, within a measurement of fair value,
the use of market-based inputs over entity-specific inputs. ASC 820 also establishes the three-level hierarchy for fair value measurements
based upon the transparency of inputs to the valuation of a financial instrument as of the measurement date as described in Note–2
 –Significant Accounting Policies.



As of December 31, 2022, $339,976,294 of the Company’s
investments were valued using unobservable inputs, and $80,852,364 were valued using observable inputs. During the year ended December 31,
2022, $160,938,497 transferred into Level 3 due to a decrease in observable prices in the market and $997,500 transferred out of Level
3 due to the liquidity in the market and transparency of inputs.



As of December 31, 2021, $153,189,910 of the Company’s
investments were valued using unobservable inputs, and $249,864,464 were valued using observable inputs. During the year ended December 31,
2021, $12,547,774 transferred into Level 3 due to a decrease in observable prices in the market and $42,450,172 transferred out of Level
3 due to the liquidity in the market and transparency of inputs.



The following table presents the Company’s investments
carried at fair value as of December 31, 2022 and 2021, by caption on the Company’s accompanying statements of assets and
liabilities and by security type.



|                            |  | Assets at Fair Value as of December 31, 2022 |  
|--------------------------- |  | -------------------------------------------- | -
|                            |  | Level 1                                      |  
|First Lien Debt             |  | $                                            | -
|Unitranche Debt             |  |                                              | -
|Second Lien Debt            |  |                                              | -
|Equity and Preferred Shares |  |                                              | -
|Total                       |  | $                                            | -



|                            |  | Assets at Fair Value as of December 31, 2021 |  
|--------------------------- |  | -------------------------------------------- | -
|                            |  | Level 1                                      |  
|First Lien Debt             |  | $                                            | -
|Unitranche Debt             |  |                                              | -
|Second Lien Debt            |  |                                              | -
|Equity and Preferred Shares |  |                                              | -
|Total                       |  | $                                            | -



In accordance with ASC 820, the following table provides
quantitative information about the Level 3 fair value measurements of the Company’s investments as of December 31, 2022. The
weighted average calculations in the table below are based on the fair value balances for all debt related calculations for the particular
input.





93







|                 |  |       |             |  |           |                 |              |                       | As of December 31, 2022
|---------------- |  | ----- | ----------- |  | --------- | --------------- | ------------ | --------------------- | -----------------------
|                 |  | Fair  |             |  | Valuation |                 | Unobservable |                       |                        
|                 |  | Value |             |  | Technique |                 | Inputs (1)   |                       | Range (2)              
|First Lien Debt  |  | $     | 187,013,801 |  |           | Matrix Pricing  |              | Senior Leverage       |                        
|                 |  |       |             |  |           |                 |              | Total Leverage        |                        
|                 |  |       |             |  |           |                 |              | Interest Coverage     |                        
|                 |  |       |             |  |           |                 |              | Debt Service Coverage |                        
|                 |  |       |             |  |           |                 |              | TEV Coverage          |                        
|                 |  |       |             |  |           |                 |              | Liquidity             |                        
|                 |  |       |             |  |           |                 |              | Spread Comparison     |                        
|                 |  |       |             |  |           |                 |              |                       |                        
|First Lien Debt  |  |       | 33,651,417  |  |           | Market Analysis |              | Senior Leverage       |                        
|                 |  |       |             |  |           |                 |              | Total Leverage        |                        
|                 |  |       |             |  |           |                 |              | Interest Coverage     |                        
|                 |  |       |             |  |           |                 |              | Debt Service Coverage |                        
|                 |  |       |             |  |           |                 |              | TEV Coverage          |                        
|                 |  |       |             |  |           |                 |              | Liquidity             |                        
|                 |  |       |             |  |           |                 |              | Spread Comparison     |                        
|                 |  |       |             |  |           |                 |              |                       |                        
|Unitranche Debt  |  |       | 87,787,461  |  |           | Matrix Pricing  |              | Senior Leverage       |                        
|                 |  |       |             |  |           |                 |              | Total Leverage        |                        
|                 |  |       |             |  |           |                 |              | Interest Coverage     |                        
|                 |  |       |             |  |           |                 |              | Debt Service Coverage |                        
|                 |  |       |             |  |           |                 |              | TEV Coverage          |                        
|                 |  |       |             |  |           |                 |              | Liquidity             |                        
|                 |  |       |             |  |           |                 |              | Spread Comparison     |                        
|                 |  |       |             |  |           |                 |              |                       |                        
|Unitranche Debt  |  |       | 4,078,227   |  |           | Market Analysis |              | Senior Leverage       |                        
|                 |  |       |             |  |           |                 |              | Total Leverage        |                        
|                 |  |       |             |  |           |                 |              | Interest Coverage     |                        
|                 |  |       |             |  |           |                 |              | Debt Service Coverage |                        
|                 |  |       |             |  |           |                 |              | TEV Coverage          |                        
|                 |  |       |             |  |           |                 |              | Liquidity             |                        
|                 |  |       |             |  |           |                 |              | Spread Comparison     |                        
|                 |  |       |             |  |           |                 |              |                       |                        
|Second Lien Debt |  |       | 23,562,691  |  |           | Matrix Pricing  |              | Senior Leverage       |                        
|                 |  |       |             |  |           |                 |              | Total Leverage        |                        
|                 |  |       |             |  |           |                 |              | Interest Coverage     |                        
|                 |  |       |             |  |           |                 |              | Debt Service Coverage |                        
|                 |  |       |             |  |           |                 |              | TEV Coverage          |                        
|                 |  |       |             |  |           |                 |              | Liquidity             |                        
|                 |  |       |             |  |           |                 |              | Spread Comparison     |                        
|                 |  |       |             |  |           |                 |              |                       |                        
|Total            |  | $     | 336,093,597 |  |           |                 |              |                       |                        





| | (1) | For
any portfolio company, the unobservable input "Liquidity" is a fraction, expressed as a percentage, the numerator of which
is the sum of the company's undrawn revolving credit facility capacity plus cash, and the denominator of which is the total amount that
may be borrowed under the company's revolving credit facility. The unobservable input "Spread Comparison" is a comparison of
the spread over the referenced rate for each investment to the spread over the referenced rate for general leveraged loan transactions.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------









| | (2) | Each
range represents the variance of outputs from calculating each statistic for each portfolio company within a specific credit seniority.  The
range may be a single data point when there is only one company represented in a specific credit seniority.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





| | (3) | Inputs
are weighted based on the fair value of the investments included in the range.
| | --- | -------------------------------------------------------------------------------------



The table above does not include $3,882,697 of debt, equity
and preferred shares which management values using other unobservable inputs, such as earnings before interest, taxes, depreciation and
amortization (“EBITDA”) and EBITDA multiples, as well as other qualitative information, including company specific information.



In accordance with ASC 820, the following table provides
quantitative information about the Level 3 fair value measurements of the Company’s investments as of December 31, 2021. The
weighted average calculations in the table below are based on the fair value balances for all debt related calculations for the particular
input.





94







|                 |  |       |             |  |           |                |              |                       | As of December 31, 2021
|---------------- |  | ----- | ----------- |  | --------- | -------------- | ------------ | --------------------- | -----------------------
|                 |  | Fair  |             |  | Valuation |                | Unobservable |                       |                        
|                 |  | Value |             |  | Technique |                | Inputs (1)   |                       | Range (2)              
|First Lien Debt  |  | $     | 113,747,244 |  |           | Matrix Pricing |              | Senior Leverage       |                        
|                 |  |       |             |  |           |                |              | Total Leverage        |                        
|                 |  |       |             |  |           |                |              | Interest Coverage     |                        
|                 |  |       |             |  |           |                |              | Debt Service Coverage |                        
|                 |  |       |             |  |           |                |              | TEV Coverage          |                        
|                 |  |       |             |  |           |                |              | Liquidity             |                        
|                 |  |       |             |  |           |                |              | Spread Comparison     |                        
|                 |  |       |             |  |           |                |              |                       |                        
|Unitranche Debt  |  |       | 17,746,161  |  |           | Matrix Pricing |              | Senior Leverage       |                        
|                 |  |       |             |  |           |                |              | Total Leverage        |                        
|                 |  |       |             |  |           |                |              | Interest Coverage     |                        
|                 |  |       |             |  |           |                |              | Debt Service Coverage |                        
|                 |  |       |             |  |           |                |              | TEV Coverage          |                        
|                 |  |       |             |  |           |                |              | Liquidity             |                        
|                 |  |       |             |  |           |                |              | Spread Comparison     |                        
|                 |  |       |             |  |           |                |              |                       |                        
|Second Lien Debt |  |       | 14,701,508  |  |           | Matrix Pricing |              | Senior Leverage       |                        
|                 |  |       |             |  |           |                |              | Total Leverage        |                        
|                 |  |       |             |  |           |                |              | Interest Coverage     |                        
|                 |  |       |             |  |           |                |              | Debt Service Coverage |                        
|                 |  |       |             |  |           |                |              | TEV Coverage          |                        
|                 |  |       |             |  |           |                |              | Liquidity             |                        
|                 |  |       |             |  |           |                |              | Spread Comparison     |                        
|                 |  |       |             |  |           |                |              |                       |                        
|Total            |  | $     | 146,194,913 |  |           |                |              |                       |                        





| | (1) | For
any portfolio company, the unobservable input "Liquidity" is a fraction, expressed as a percentage, the numerator of which
is the sum of the company's undrawn revolving credit facility capacity plus cash, and the denominator of which is the total amount that
may be borrowed under the company's revolving credit facility. The unobservable input "Spread Comparison" is a comparison of
the spread over the referenced rate for each investment to the spread over the referenced rate for general leveraged loan transactions.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (2) | Each
range represents the variance of outputs from calculating each statistic for each portfolio company within a specific credit seniority.  The
range may be a single data point when there is only one company represented in a specific credit seniority.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





| | (3) | Inputs
are weighted based on the fair value of the investments included in the range.
| | --- | -------------------------------------------------------------------------------------



The table above does not include $6,994,997 of debt,
equity and preferred shares which management values using other unobservable inputs, such as earnings before interest, taxes,
depreciation and amortization (“EBITDA”) and EBITDA multiples, as well as other qualitative information, including
company specific information.



Fair value measurements can be sensitive to changes in one
or more of the valuation inputs. Changes in market yields, discounts rates, leverage, or EBITDA multiples (or revenue or revenue multiples),
each in isolation, may change the fair value of certain of the Company’s investments. Generally, an increase or decrease in market
yields, discount rates or leverage or a decrease in EBITDA or EBITDA multiples (or revenue or revenue multiples) may result in a corresponding
decrease or increase, respectively, in the fair value of certain of the Company’s investments.



The following tables provide the changes in fair value,
broken out by security type, during the year ended December 31, 2022 and 2021 for all investments for which the Company determines
fair value using unobservable (Level 3) factors.





95







|Year Ended December 31, 2022                          |  | First Lien Debt |             |   | Unitranche Debt |   |            | Second Lien Debt |  |   | Equity and
Preferred
Shares |   |  | Total |          
|----------------------------------------------------- |  | --------------- | ----------- | - | --------------- | - | ---------- | ---------------- |  | - | --------------------------- | - |  | ----- | ---------
|Fair Value as of December 31, 2021                    |  | $               | 118,049,277 |   |                 | $ | 19,092,768 |                  |  | $ | 14,701,508                  |   |  | $     | 1,346,357
|Transfers into Level 3                                |  |                 | 129,632,383 |   |                 |   | 21,362,424 |                  |  |   | 9,943,690                   |   |  |       | -        
|Transfers out of Level 3                              |  |                 | -           |   |                 |   | -          |                  |  |   | (997,500                    | ) |  |       | -        
|Total gains:                                          |  |                 |             |   |                 |   |            |                  |  |   |                             |   |  |       |          
|Net realized
    gain(a)                              |  |                 | 318,225     |   |                 |   | 98,258     |                  |  |   | 20,746                      |   |  |       | 611,389  
|Net unrealized
    (depreciation) appreciation(b)     |  |                 | (2,067,500  | ) |                 |   | (710,363   | )                |  |   | (75,985                     | ) |  |       | 192,391  
|New investments,
    repayments and settlements:(c)   |  |                 |             |   |                 |   |            |                  |  |   |                             |   |  |       |          
|Purchases                                             |  |                 | 41,042,665  |   |                 |   | 58,700,698 |                  |  |   | 2,440,000                   |   |  |       | 2,457,201
|Settlements/repayments                                |  |                 | (58,428,308 | ) |                 |   | (6,986,618 | )                |  |   | (2,499,999                  | ) |  |       | (764,889 
|Net amortization of premiums, PIK, discounts and fees |  |                 | 463,844     |   |                 |   | 308,521    |                  |  |   | 30,231                      |   |  |       | -        
|Sales                                                 |  |                 | (8,116,670  | ) |                 |   | -          |                  |  |   | -                           |   |  |       | (188,450 
|Fair Value as of December 31, 2022                    |  | $               | 220,893,916 |   |                 | $ | 91,865,688 |                  |  | $ | 23,562,691                  |   |  | $     | 3,653,999



| | (a) | Included
in net realized gain on the accompanying Statement of Operations for the year ended December 31, 2022.
| | --- | ---------------------------------------------------------------------------------------------------------------

| | (b) | Included
in net change in unrealized (depreciation) appreciation on the accompanying Statement of Operations for the year ended December 31,
2022.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------

| | (c) | Includes
increases in the cost basis of investments resulting from portfolio investments, the amortization of discounts, and PIK, as well as decreases
in the costs basis of investments resulting from principal repayments or sales, the amortization of premiums and acquisition costs and
other cost-basis adjustments.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





|Year
    Ended December 31, 2021                      |  | First Lien Debt |             |   | Unitranche
Debt |   |            | Second Lien Debt |  |   | Equity and
Preferred
Shares |   |  | Total |          
|----------------------------------------------------- |  | --------------- | ----------- | - | --------------- | - | ---------- | ---------------- |  | - | --------------------------- | - |  | ----- | ---------
|Fair Value as of December 31, 2020                    |  | $               | 161,186,494 |   |                 | $ | 9,723,677  |                  |  | $ | 27,290,845                  |   |  | $     | 799,189  
|Transfers into Level 3                                |  |                 | 12,382,636  |   |                 |   | -          |                  |  |   | -                           |   |  |       | 165,138  
|Transfers out of Level 3                              |  |                 | (38,973,922 | ) |                 |   | -          |                  |  |   | (3,476,250                  | ) |  |       | -        
|Total gains:                                          |  |                 |             |   |                 |   |            |                  |  |   |                             |   |  |       |          
|Net realized
    gain (loss)(a)                       |  |                 | 207,086     |   |                 |   | 5,908      |                  |  |   | 51,513                      |   |  |       | (383,174 
|Net unrealized
    appreciation (depreciation)(b)     |  |                 | 414,652     |   |                 |   | (393,916   | )                |  |   | (9,885                      | ) |  |       | 483,620  
|New investments,
    repayments and settlements:(c)   |  |                 |             |   |                 |   |            |                  |  |   |                             |   |  |       |          
|Purchases                                             |  |                 | 30,057,578  |   |                 |   | 11,122,099 |                  |  |   | 2,965,000                   |   |  |       | 698,944  
|Settlements/repayments                                |  |                 | (42,734,237 | ) |                 |   | (1,542,549 | )                |  |   | (10,761,438                 | ) |  |       | -        
|Net amortization of premiums, PIK, discounts and fees |  |                 | 225,564     |   |                 |   | 177,549    |                  |  |   | 87,494                      |   |  |       | -        
|Sales                                                 |  |                 | (4,716,574  | ) |                 |   | -          |                  |  |   | (1,445,771                  | ) |  |       | (417,360 
|Fair Value as of December 31, 2021                    |  | $               | 118,049,277 |   |                 | $ | 19,092,768 |                  |  | $ | 14,701,508                  |   |  | $     | 1,346,357



| | (a) | Included
in net realized gain (loss) on the accompanying Statement of Operations for the year ended December 31, 2021.
| | --- | ----------------------------------------------------------------------------------------------------------------------

| | (b) | Included
in net change in unrealized appreciation (depreciation) on the accompanying Statement of Operations for the year ended December 31,
2021.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------

| | (c) | Includes
increases in the cost basis of investments resulting from portfolio investments, the amortization of discounts, and PIK, as well as decreases
in the costs basis of investments resulting from principal repayments or sales, the amortization of premiums and acquisition costs and
other cost-basis adjustments.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The change in unrealized value attributable to investments
still held at December 31, 2022 and 2021 were ($655,200) and $346,421, respectively.



Investment Activities



The Company held a total of 252 syndicated investments with
an aggregate fair value of $420,828,658 as of December 31, 2022. During the year ended December 31, 2022, the Company invested
in 158 new syndicated investments for a combined $103,470,665 and in existing investments for a combined $9,492,066. The Company also
received $69,513,201 in repayments from investments and $21,825,900 from investments sold during the period.



The Company held a total of 251 syndicated investments with
an aggregate fair value of $403,054,374 as of December 31, 2021. During the year ended December 31, 2021, the Company invested
in 216 new syndicated investments for a combined $150,158,668 and in existing investments for a combined $9,540,881. The Company also
received $99,779,754 in repayments from investments and $15,117,554 from investments sold during the period.



Investment Concentrations



As of December 31, 2022, the Company’s investment
portfolio consisted of investments in 222 companies located in 37 states across 25 different industries, with an aggregate fair value
of $420,828,658. The five largest investments at fair value as of December 31, 2022 totaled $24,910,205, or 5.92% of the Company’s
total investment portfolio as of such date. As of December 31, 2022, the Company’s average investment was $1,697,226 at cost.





96







As of December 31, 2021, the Company’s investment
portfolio consisted of investments in 215 companies located in 35 states across 26 different industries, with an aggregate fair value
of $403,054,374. The five largest investments at fair value as of December 31, 2021 totaled $22,205,933, or 5.51% of the Company’s
total investment portfolio as of such date. As of December 31, 2021, the Company’s average investment was $1,610,728 at cost.



The following table outlines the Company’s investments
by security type as of December 31, 2022 and 2021:



|                            |  | December 31, 2022 |            
|--------------------------- |  | ----------------- | -----------
|                            |  | Cost              |            
|First Lien Debt             |  | $                 | 301,685,656
|Unitranche Debt             |  |                   | 98,045,938 
|Second Lien Debt            |  |                   | 24,667,515 
|Total Debt Investments      |  |                   | 424,399,109
|Equity and Preferred Shares |  |                   | 3,301,747  
|Total Equity Investments    |  |                   | 3,301,747  
|Total Investments           |  | $                 | 427,700,856



|                            |  | December 31, 2021 |            
|--------------------------- |  | ----------------- | -----------
|                            |  | Cost              |            
|First Lien Debt             |  | $                 | 337,204,744
|Unitranche Debt             |  |                   | 41,225,444 
|Second Lien Debt            |  |                   | 24,675,934 
|Total Debt Investments      |  |                   | 403,106,122
|Equity and Preferred Shares |  |                   | 1,186,496  
|Total Equity Investments    |  |                   | 1,186,496  
|Total Investments           |  | $                 | 404,292,618





97







Investments at fair value consisted of the following industry
classifications as of December 31, 2022 and 2021:



|                                          |  | December 31, 2022 |             |  | December 31, 2021                | 
|----------------------------------------- |  | ----------------- | ----------- |  | -------------------------------- | 
|Industry                                  |  | Fair Value        |             |  | Percentage of
 Total Investments | 
|Healthcare & Pharmaceuticals              |  | $                 | 74,735,672  |  |                                  | 
|Services: Business                        |  |                   | 69,269,858  |  |                                  | 
|High Tech Industries                      |  |                   | 51,379,328  |  |                                  | 
|Containers, Packaging & Glass             |  |                   | 33,987,694  |  |                                  | 
|Banking, Finance, Insurance & Real Estate |  |                   | 32,865,053  |  |                                  | 
|Capital Equipment                         |  |                   | 28,019,443  |  |                                  | 
|Aerospace & Defense                       |  |                   | 21,269,972  |  |                                  | 
|Chemicals, Plastics & Rubber              |  |                   | 19,080,225  |  |                                  | 
|Transportation: Cargo                     |  |                   | 13,798,595  |  |                                  | 
|Services: Consumer                        |  |                   | 13,773,067  |  |                                  | 
|Beverage, Food & Tobacco                  |  |                   | 11,310,292  |  |                                  | 
|Construction & Building                   |  |                   | 10,699,594  |  |                                  | 
|Automotive                                |  |                   | 10,520,824  |  |                                  | 
|Environmental Industries                  |  |                   | 7,517,679   |  |                                  | 
|Consumer Goods: Non-durable               |  |                   | 5,534,099   |  |                                  | 
|Wholesale                                 |  |                   | 3,771,670   |  |                                  | 
|Media: Advertising, Printing & Publishing |  |                   | 2,781,895   |  |                                  | 
|Hotels, Gaming & Leisure                  |  |                   | 2,148,253   |  |                                  | 
|Metals & Mining                           |  |                   | 1,689,870   |  |                                  | 
|Forest Products & Paper                   |  |                   | 1,451,250   |  |                                  | 
|Utilities: Electric                       |  |                   | 1,442,284   |  |                                  | 
|Retail                                    |  |                   | 1,390,874   |  |                                  | 
|Utilities: Water                          |  |                   | 970,217     |  |                                  | 
|Energy: Electricity                       |  |                   | 948,150     |  |                                  | 
|Consumer Goods: Durable                   |  |                   | 472,800     |  |                                  | 
|Media: Diversified & Production           |  |                   | -           |  |                                  | 
|                                          |  | $                 | 420,828,658 |  |                                  | 
|                                          |  |                   |             |  |                                  | 



Investments at fair value were included in the following
geographic regions of the United States as of December 31, 2022 and 2021:



|                      |  | December 31, 2022 |             |  | December 31, 2021                       | 
|--------------------- |  | ----------------- | ----------- |  | --------------------------------------- | 
|Geographic
    Region |  | Fair
    Value    |             |  | Percentage
    of
    Total Investments | 
|Midwest               |  | $                 | 99,995,134  |  |                                         | 
|Northeast             |  |                   | 97,037,723  |  |                                         | 
|Southeast             |  |                   | 62,170,072  |  |                                         | 
|Southwest             |  |                   | 54,750,013  |  |                                         | 
|West                  |  |                   | 54,739,431  |  |                                         | 
|East                  |  |                   | 36,228,410  |  |                                         | 
|South                 |  |                   | 7,880,894   |  |                                         | 
|Other(a)              |  |                   | 4,420,172   |  |                                         | 
|Northwest             |  |                   | 3,606,809   |  |                                         | 
|Total Investments     |  | $                 | 420,828,658 |  |                                         | 



(a) The Company headquarters for Sophos is located in the United Kingdom. The Company headquarters for UDG is located in Ireland. The Company headquarters for Intertape Polymer is located in Canada. The Company headquarters for Integro is located in the United Kingdom.











98







The geographic region indicates the location of the headquarters
of the Company’s portfolio companies. A portfolio company may have a number of other business locations in other geographic regions.



Investment Principal Repayments



The following table summarizes the contractual principal
repayments and maturity of the Company’s investment portfolio by fiscal year, assuming no voluntary prepayments, as of December 31,
2022:



|For the Fiscal Years
    Ending December 31:                                          |  | Amount |            
|------------------------------------------------------------------------------------- |  | ------ | -----------
|2023                                                                                  |  | $      | 16,220,478 
|2024                                                                                  |  |        | 34,607,729 
|2025                                                                                  |  |        | 52,954,997 
|2026                                                                                  |  |        | 58,746,803 
|2027                                                                                  |  |        | 70,701,978 
|Thereafter                                                                            |  |        | 195,677,137
|Total contractual repayments                                                          |  |        | 428,909,122
|Adjustments to cost basis on debt investments(a)                                      |  |        | (4,510,012 
|Total Cost Basis of Debt
    Investments Held at December 31, 2022:                   |  | $      | 424,399,110
|                                                                                      |  |        |            
|(a)
      Adjustment to cost basis related to unamortized balance of OID investments. |  |        |            



Note 4. Related Party Transactions



Investment Advisory Agreement

The Company has entered into an investment advisory agreement
(the “Investment Advisory Agreement”) with the Adviser. In accordance with the Investment Advisory Agreement, the Company
pays the Adviser certain fees as compensation for its services, such fees consisting of a base management fee and an incentive fee (the
 “Incentive Fee”). The services the Adviser provides to the Company, subject to the overall supervision of the Company’s
Board of Directors, include managing the day-to-day operations of, and providing investment services to, the Company. The Company also
entered into a management fee waiver agreement with the Adviser (the “Waiver Agreement”), which the Company or the Adviser
may terminate upon 60 days’ prior written notice.



Management Fee

The base management fee is calculated at an annual rate
of 1.0% of the Company’s average gross assets including cash and any temporary investments in cash-equivalents, including U.S.
government securities and other high-quality investment grade debt investments that mature in 12 months or less from the date of investment,
payable quarterly in arrears on a calendar quarter basis.



Pursuant to the Waiver Agreement, the Adviser has agreed
to waive the right to receive the base management fee to the extent necessary so that the base management fee payable under the Investment
Advisory Agreement equals, and is calculated in the same manner as if, the base management fee otherwise payable by the Company were
calculated at an annual rate equal to 0.65% (instead of an annual rate of 1.00%).



For the year ended December 31, 2022, the Company recorded
base management fees of $4,422,989 and waivers to the base management fees of $1,548,046, as set forth within the accompanying statements
of operations. For the year ended December 31, 2021, the Company recorded base management fees of $3,764,399 and waivers to the
base management fees of $1,317,540, as set forth within the accompanying statements of operations. For the year ended December 31,
2020, the Company recorded base management fees of $3,616,250 and waivers to the base management fees of $1,265,687, as set forth within
the accompanying statements of operations.





99







Incentive Fee

The Incentive Fee has two parts, as follows: the first part
of the Incentive Fee is calculated and payable quarterly in arrears based on the Company’s 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 (including any other fees (other than fees for providing managerial assistance), such as commitment, origination,
structuring, diligence and consulting fees or other fees that the Company receives from portfolio companies) accrued during the calendar
quarter, minus the Company’s operating expenses accrued for the quarter (including the base management fee, expenses payable under
the Administration Agreement (as defined below) and any interest expense on any credit facilities or outstanding debt and dividends paid
on any issued and outstanding preferred stock, but excluding the Incentive Fee).



The Company determines pre-incentive
fee net investment income in accordance with GAAP, including, in the case of investments with a deferred
interest feature, such as debt instruments with PIK interest, OID securities and accrued income that
the Company has 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 appreciation
or depreciation. Pre-incentive fee net investment income, expressed as a rate of return on the value
of the Company’s net assets at the end of the immediately preceding calendar quarter, is compared
to a hurdle of 1.0% per quarter (4.0% annualized). The Company determines its average gross assets
during each fiscal quarter and calculates the base management fee payable with respect to such amount at
the end of each fiscal quarter.  As a result, a portion of the Company’s net investment income is included in
its gross assets for the period between the date on which such income is earned and the date on which such income
is distributed. Therefore, the Company’s net investment income used to calculate part of the Incentive Fee
is also included in the amount of the Company’s gross assets used to calculate the 1.0% annual base management
fee. The Company pays its Adviser an Incentive Fee with respect to its pre-incentive fee net investment
income in each calendar quarter as follows:



| | · | no amount is paid on the income-portion of the Incentive Fee in
    any calendar quarter in which the Company’s pre-incentive fee net investment income does not exceed the hurdle of 1.0% (4.0%
    annualized);                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | · | 100% of the Company’s 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 rate but is
    less than 1.1765 % in any calendar quarter (4.706% annualized). The Company refers to this portion of its pre-incentive fee net investment
    income (which exceeds the hurdle rate but is less than 1.1765%) as the “catch-up” provision. The catch-up is meant to
    provide the Adviser with 15.0% of the pre-incentive fee net investment income as if a hurdle rate did not apply if net investment
    income exceeds 1.1765% in any calendar quarter (4.706% annualized); and
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| | · | 15.0% of the amount of the Company’s pre-incentive
    fee net investment income, if any, that exceeds 1.1765% in any calendar quarter (4.706% annualized) is payable to the Adviser.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 



Pursuant to the Waiver Agreement, the Adviser has agreed
to waive its right to receive the Incentive Fee on pre-incentive fee net investment income to the extent necessary so that such Incentive
Fee equals, and is calculated in the same manner as, the corresponding Incentive Fee on pre-incentive fee net investment income, if such
Incentive Fee (i) were calculated based upon the Adviser receiving 10.0% (instead of 15.0%) of the applicable pre-incentive fee
net investment income and (ii) did not include any “catch-up” feature in favor of the Adviser.



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 equals 15.0% of the Company’s realized capital gains, if any, on a cumulative basis from June 16, 2015, the effective
date of the Company’s registration statement on Form 10 (file no. 000-55426), through the end of each calendar year, computed
net of all realized capital losses and unrealized capital depreciation on a cumulative basis, less the aggregate amount of any previously
paid capital gain Incentive Fees with respect to each of the investments in the Company’s portfolio.





100







Pursuant to the Waiver Agreement, the Adviser has agreed
to waive the right to receive the Incentive Fee on capital gains to the extent necessary so that such portion of the Incentive Fee equals,
and is calculated in the same manner as, the corresponding Incentive Fee on capital gains, if such portion of the Incentive Fee were
calculated based upon the Adviser receiving 10.0% (instead of 15.0%).



In addition, pursuant to the Waiver Agreement, the Adviser
has agreed to waive the right to receive both components of the Incentive Fee to the extent necessary so that it does not receive Incentive
Fees which are attributable to income and gains of the Company that exceed an annualized rate of 12.0% in any calendar quarter.



The waivers from the Adviser will remain effective until
terminated earlier by either party upon 60 days’ prior written notice.



Under the Investment Advisory Agreement, we do not pay any
Capital Gains Incentive Fee in respect of unrealized capital appreciation in our portfolio.  However, under U.S. generally accepted
accounting principles, or GAAP, we are required to accrue for the Capital Gain Incentive Fee on a quarterly basis as if such unrealized
capital appreciation were realized in full at the end of each period. If the Capital Gain Incentive Fee Base, adjusted as required by
GAAP to include unrealized appreciation, is positive at the end of a period, then GAAP and the terms of the Investment Advisory Agreement
require us to accrue a capital gain incentive fee equal to 20% of such amount, less the aggregate amount of actual capital gain incentive
fees paid or capital gain incentive fees accrued under GAAP in all prior periods. If such amount is negative, then there is no accrual
for such period. The resulting accrual under GAAP for a capital gain incentive fee payable in any period will result in additional expense
if such cumulative amount is greater than in the prior period, or in a reversal of previously recorded expense if such cumulative amount
is less than in the prior period. We can offer no assurance that any unrealized capital appreciation will be realized in the future.



For the year ended December 31, 2022, the Company recorded
Incentive Fees related to net investment income of $3,454,468. Offsetting the Incentive Fees were waivers of the Incentive Fees related
to net investment income of $2,657,883, as set forth within the accompanying statements of operations. For the year ended December 31,
2021, the Company recorded Incentive Fees related to net investment income of $848,440. Offsetting the Incentive Fees were waivers of
the Incentive Fees related to net investment income of $763,596, as set forth within the accompanying statements of operations. For the
year ended December 31, 2020, the Company recorded Incentive Fees related to net investment income of $1,818,457. Offsetting the
Incentive Fees were waivers of the Incentive Fees related to net investment income of $1,596,800, as set forth within the accompanying
statements of operations.



For the years ended December 31, 2022, 2021 and 2020,
the Company did not record any Incentive Fees related to capital gains.



Administrative Fee

The
Company has also entered into an administration agreement (the “Administration Agreement”) with Audax Management Company,
LLC (the “Administrator”) pursuant to which the Administrator provides administrative services to the Company. Under
the Administration Agreement, the Administrator performs, or oversees the performance of administrative services necessary for the operation
of the Company, which include being responsible for the financial records which the Company is required to maintain and prepare reports
filed with the SEC. In addition, the Administrator assists in determining and publishing the Company’s net asset value, oversees
the preparation and filing of the Company’s tax returns and the printing and dissemination of reports to the Company’s stockholders,
and generally oversees the payment of the Company’s expenses and the performance of administrative and professional services rendered
to the Company by others. The Company reimburses the Administrator for its allocable portion of the costs and expenses incurred by the
Administrator for overhead in performance by the Administrator of its duties under the Administration Agreement, including the cost of
facilities, office equipment and the Company’s allocable portion of cost of compensation and related expenses of its Chief Financial
Officer and Chief Compliance Officer and their respective staffs, as well as any costs and expenses incurred by the Administrator relating
to any administrative or operating services provided by the Administrator to the Company. Such costs are reflected as an administrative
fee in the accompanying statements of operations.





101







The Company has also entered into a fee waiver agreement
with the Administrator, pursuant to which the Administrator may waive, in whole or in part, its entitlement to receive reimbursements
from the Company.



For each of the years ended December 31, 2022, 2021
and 2020, the Company recorded administrative fees of $265,000, as set forth within the accompanying statements of operations.



Related Party Fees

Fees
due to related parties as of December 31,2022 and 2021 on the Company’s accompanying statements of assets and liabilities
were as follows:



|                                          |  | December 31,
    2022 |           |  | December 31, 2021 |  
|----------------------------------------- |  | --------------------- | --------- |  | ----------------- | -
|Net base management fee due to Adviser    |  | $                     | 732,900   |  |                   | $
|Net incentive fee due to Adviser          |  |                       | 404,409   |  |                   |  
|Total fees due to Adviser, net of waivers |  |                       | 1,137,309 |  |                   |  
|Fee due to Administrator, net of waivers  |  |                       | 66,250    |  |                   |  
|Total Related Party Fees Due              |  | $                     | 1,203,559 |  |                   | $



Other Agreements

The Company may invest alongside other clients of the Adviser
and its affiliates in certain circumstances where doing so is consistent with applicable law, SEC staff interpretations and the terms
of the Company’s exemptive relief.



Note 5. Net Increase in Net Assets Resulting from Operations Per
Share of Common Stock:



The following table sets forth the computation of basic
and diluted net increase in net assets resulting from operations per weighted average share of Company’s common stock par value
$0.001 per share (the “Common Stock”), for the years ended December 31, 2022, 2021, and 2020:



|                                                                                                        |  | Year Ended 
December 31, 2022 |            |  | Year Ended 
December 31, 2021 |   |            | Year Ended 
December 31, 2020 | 
|------------------------------------------------------------------------------------------------------- |  | ----------------------------- | ---------- |  | ----------------------------- | - | ---------- | ----------------------------- | 
|Numerator for basic and
  diluted net increase in net assets resulting from operations per common share |  | $                             | 19,037,618 |  |                               | $ | 17,758,609 |                               | 
|Denominator for
  basic and diluted weighted average common shares                                      |  |                               | 45,106,946 |  |                               |   | 39,463,569 |                               | 
|Basic
  and diluted net increase in net assets resulting from operations per common share               |  | $                             | 0.42       |  |                               | $ | 0.45       |                               | 



Note 6. Income Tax



The
Company has elected to be regulated as a BDC under the 1940 Act, as well as elected to be treated as a RIC under Subchapter M of the
Code. As a RIC, the Company generally is not subject to corporate-level U.S. federal income taxes on any ordinary income or capital gains
that it timely distributes as dividends for U.S. federal income tax purposes to its stockholders. To qualify to be treated as a RIC,the Company is required to meet certain source of income and asset diversification requirements, and to timely distribute dividends
out of assets legally available for distributions to its stockholders of an amount generally equal to at least 90% of the sum of its
net ordinary income and net short-term capital gains in excess of net long-term capital losses, if any (i.e., “investment company
taxable income,” determined without regard to any deduction for dividends paid), for each taxable year. The amount to be paid out
as distributions to the Company’s stockholders is determined by the Board of Directors and is based on management’s estimate
of the fiscal year earnings. Based on that estimate, the Company intends to make the requisite distributions to its stockholders, which
will generally relieve the Company from corporate-level U.S. federal income taxes. Although the Company currently intends to distribute
its net capital gains (i.e., net long-term capital gains in excess of net short-term capital losses), if any, recognized in respect of
each taxable year as dividends out of the Company’s assets legally available for distribution, the Company in the future may decide
to retain for investment and be subject to entity-level income tax on such net capital gains. Additionally, depending on the level of
taxable income earned in a taxable year, the Company may choose to carry forward taxable income in excess of current year distributions
into the next taxable year and incur a 4% excise tax on such income, as required. To the extent that the Company determines that its
estimated current year annual taxable income will be in excess of estimated current year distributions, the Company will accrue an excise
tax, if any, on estimated excess taxable income as such excess taxable income is earned.





102







During the year ended December 31, 2022, the Fund executed
a total of $50,000,000 in Tender Offers that resulted in differing GAAP vs. tax treatment of proceeds distributed. For GAAP purposes
the transaction is treated as a redemption of shares whereas tax regulations dictate dividend distribution treatment to the extent of
fund level earnings and profits. Given that the fund did not have sufficient earnings and profits to support the distribution, the entire
value of the Tender Offer is treated as a return of capital for tax purposes.



The Company had aggregate distributions declared and paid
to its stockholders for the year ended December 31, 2022 of $24,507,347, or $0.54 per share. The tax character of the distributions
declared and paid represented $23,797,493 from ordinary income and $709,854 from tax return of capital. The Company had aggregate distributions
declared and paid to its stockholders for the year ended December 31, 2021 of $15,794,187, or $0.40 per share. The tax character
of the distributions declared and paid represented $15,541,807 from ordinary income and $252,380 from tax return of capital.



GAAP require adjustments to certain components of net assets
to reflect permanent differences between financial and tax reporting. These adjustments have no effect on net asset value per share.
For the year ended December 31, 2022 and 2021, the Company recorded the following adjustments for permanent book to tax differences
to reflect their tax characteristics. The adjustments only change the classification in net assets in the statements of assets and liabilities.
During the year ended December 31, 2022 and 2021, the Company reclassified for book purposes amounts arising from permanent book/tax
differences primarily related to distribution redesignations and return of capital distributions.



|                                     |  | Year Ended 
December 31, 2022 |      |   | Year Ended 
December 31, 2021 |  
|------------------------------------ |  | ----------------------------- | ---- | - | ----------------------------- | -
|Capital in excess of par value       |  | $                             | -    |   |                               | $
|Accumulated net investment income    |  |                               | (430 | ) |                               |  
|Accumulated net realized gain (loss) |  |                               | 430  |   |                               |  



At December 31, 2022 and 2021, the components of distributable
taxable earnings as detailed below differ from the amounts reflected in the Company’s statements of assets and liabilities by temporary
book/tax differences primarily arising from amortization of organizational expenditures.



|                                                              |  | As of December 31,
2022 |            |   | As of December 31,
2021 |  
|------------------------------------------------------------- |  | ----------------------- | ---------- | - | ----------------------- | -
|Other temporary book/tax differences                          |  | $                       | (152,362   | ) |                         | $
|Net tax basis unrealized depreciation                         |  |                         | (6,872,198 | ) |                         |  
|Accumulated net realized loss                                 |  |                         | (2,500,103 | ) |                         |  
|Components of tax distributable (loss) earnings at period end |  | $                       | (9,524,663 | ) |                         | $





103







Certain losses incurred by the Company after October 31
of a taxable year are deemed to arise on the first business day of the Company’s next taxable year. The Company did not incur such
losses after October 31 of the Company’s taxable year ended December 31, 2022.



Capital losses are generally eligible to be carried forward
indefinitely, and retain their status as short-term or long-term in the manner originally incurred by the Company. As of December 31,
2022, the Company has long-term capital loss carryforward of $2,500,103. The Company has evaluated tax positions it has taken, expects
to take, or that are otherwise relevant to the Company for purposes of determining whether any relevant tax positions would “more-likely-than-not”
be sustained by the applicable tax authority in accordance with ASC Topic 740, “Income Taxes,” as modified by ASC
Topic 946. The Company has analyzed such tax positions and has concluded that no unrecognized tax benefits should be recorded for uncertain
tax positions for taxable years that may be open. The Company is not aware of any tax positions for which it is reasonably possible that
the total amounts of unrecognized tax benefits will change materially in the next twelve months. The Company’s U.S. federal tax
returns for fiscal years 2022, 2021, and 2020 remain subject to examination by the Internal Revenue Service. The Company records tax
positions that are not deemed to meet a more-likely-than-not threshold as tax expenses as well as any applicable penalties or interest
associated with such positions. During each of the years ended December 31, 2022, 2021, and 2020, no tax expense or any related
interest or penalties were incurred.



Note 7. Equity



An investor made capital commitments to the Company in the
amounts set forth below as of the date opposite each capital commitment:



|Amount |             |  | Date |                    
|------ | ----------- |  | ---- | -------------------
|$      | 140,000,000 |  |      | June 23, 2015      
|$      | 50,000,000  |  |      | December 2, 2016   
|$      | 100,000,000 |  |      | On December 7, 2017
|$      | 40,000,000  |  |      | March 22, 2019     
|$      | 30,000,000  |  |      | September 23, 2019 
|$      | 11,200,000  |  |      | March 20, 2020     
|$      | 8,900,000   |  |      | May 28, 2021       
|$      | 110,000,000 |  |      | December 15, 2021  



As of December 31, 2022, there were no remaining unfunded
capital commitments by the Company’s investors.



The number of shares of Common Stock issued and outstanding
as of December 31, 2022 and December 31, 2021, were 46,376,461 and 39,961,408, respectively.



On
April 22, 2022, the Company issued a Tender Offer to repurchase $20.0 million worth of Common Stock from the stockholders. The Offer
was accepted on May 20, 2022. On July 14, 2022, the Company issued a Tender Offer to repurchase $15.0 million worth
of Common Stock from the stockholders. The Offer was accepted on August 11, 2022. On October 13, 2022, the Company issued a
Tender Offer to repurchase $15.0 million worth of Common Stock from the stockholders. The Offer was accepted on November 21, 2022.



The following table summarizes activity in the number of
Shares during the years ended December 31, 2022 and 2021:





104







|                                                                                                      |  | Common stock shares in issue |                              
|----------------------------------------------------------------------------------------------------- |  | ---------------------------- | -----------------------------
|                                                                                                      |  |                              | Year Ended 
December 31, 2022
|Shares in issue, beginning of period                                                                  |  |                              | 39,961,408                   
|Common stock issued ($110,000,000 and $15,100,000, respectively)                                      |  |                              | 11,746,415                   
|Common stock repurchased ($50,000,000 and $0, respectively)                                           |  |                              | (5,331,370                   
|Issuance of common shares in connection with dividend
  reinvestment plan ($73 and $51, respectively) |  |                              | 8                            
|Shares in issue, end of period                                                                        |  |                              | 46,376,461                   



The following table details the activity of Stockholders’
Equity for the years ended December 31, 2022 and 2021:



|Year Ended December 31, 2022                         |  | Common Stock |        |   | Capital in 
Excess of Par
Value |   |             | Total 
Distributable (Loss)
Earnings |  |   | Total 
Stockholders'
Equity |  
|---------------------------------------------------- |  | ------------ | ------ | - | ------------------------------- | - | ----------- | ------------------------------------ |  | - | --------------------------- | -
|Balance as of December 31, 2021                      |  | $            | 39,961 |   |                                 | $ | 378,672,161 |                                      |  | $ | (4,764,788                  | )
|Net investment income                                |  |              | -      |   |                                 |   | -           |                                      |  |   | 23,817,808                  |  
|Net realized gain from investment transactions       |  |              | -      |   |                                 |   | -           |                                      |  |   | 853,764                     |  
|Net change in unrealized depreciation on investments |  |              | -      |   |                                 |   | -           |                                      |  |   | (5,633,954                  | )
|Issuance of shares                                   |  |              | 11,738 |   |                                 |   | 109,988,254 |                                      |  |   | -                           |  
|Repurchase of shares                                 |  |              | (5,331 | ) |                                 |   | (49,994,669 | )                                    |  |   | -                           |  
|Distributions to Stockholders                        |  |              | -      |   |                                 |   | (709,854    | )                                    |  |   | (23,797,493                 | )
|Reinvested Dividends                                 |  |              | 8      |   |                                 |   | 73          |                                      |  |   | -                           |  
|Balance as of December 31, 2022                      |  | $            | 46,376 |   |                                 | $ | 437,955,965 |                                      |  | $ | (9,524,663                  | )



|Year Ended December 31, 2021                         |  | Common Stock |        |  | Capital in 
Excess of Par
Value |   |             | Total 
Distributable (Loss)
Earnings |  |   | Total 
Stockholders'
Equity |  
|---------------------------------------------------- |  | ------------ | ------ |  | ------------------------------- | - | ----------- | ------------------------------------ |  | - | --------------------------- | -
|Balance as of December 31, 2020                      |  | $            | 38,343 |  |                                 | $ | 363,826,108 |                                      |  | $ | (6,981,590                  | )
|Net investment income                                |  |              | -      |  |                                 |   | -           |                                      |  |   | 15,562,122                  |  
|Net realized loss from investment transactions       |  |              | -      |  |                                 |   | -           |                                      |  |   | (196,218                    | )
|Net change in unrealized appreciation on investments |  |              | -      |  |                                 |   | -           |                                      |  |   | 2,392,705                   |  
|Issuance of shares                                   |  |              | 1,613  |  |                                 |   | 15,098,382  |                                      |  |   | -                           |  
|Distributions to Stockholders                        |  |              | -      |  |                                 |   | (252,380    | )                                    |  |   | (15,541,807                 | )
|Reinvested Dividends                                 |  |              | 5      |  |                                 |   | 51          |                                      |  |   | -                           |  
|Balance as of December 31, 2021                      |  | $            | 39,961 |  |                                 | $ | 378,672,161 |                                      |  | $ | (4,764,788                  | )



Note 8. Borrowings



Short-Term Borrowings

From time to time, the Company finances the purchase of
certain investments through repurchase agreements. In the repurchase agreements, the Company enters into a trade to sell an investment
and contemporaneously enters into a trade to buy the same investment back on a specified date in the future with the same counterparty.
Investments sold under repurchase agreements are accounted for as collateralized borrowings as the sale of the investment does not qualify
for sale accounting under ASC Topic 860—Transfers and Servicing and remains as an investment on the Statement of Assets and Liabilities.
The Company uses repurchase agreements as a short-term financing alternative. As of December 31, 2022, the Company had short-term
borrowings outstanding of $13,178,611. For the year ended December 31, 2022, the Company recorded interest expense in connection
with short-term borrowings of $712,005. For the year ended December 31, 2021, the Company had no short-term borrowings outstanding.





105







Note 9. Commitments and Contingencies



The Company may enter into certain credit agreements that
include loan commitments where all or a portion of such commitment may be unfunded. The Company is generally obligated to fund the unfunded
loan commitments at the borrowers’ discretion. Funded portions of credit agreements are presented on the accompanying schedule
of investments. Unfunded loan commitments and funded portions of credit agreements are fair valued and unrealized appreciation or depreciation,
if any, have been included in the accompanying statements of assets and liabilities and statements of operations.



The
following table summarizesthe Company’s significant contractual payment obligations as of December 31, 2022 and December 31,
2021:



|Investment                                                                                                                                                 |  | Industry                                      |  | December 31,
    2022 |            |  | December 31,
    2021 |  
|---------------------------------------------------------------------------------------------------------------------------------------------------------- |  | --------------------------------------------- |  | --------------------- | ---------- |  | --------------------- | -
|PracticeTek,
    Senior Secured Delayed Draw Term Loan, 11.02% (LIBOR + 6.25%), maturity 11/23/27                                                          |  | High
    Tech Industries                      |  | $                     | 1,889,313  |  |                       | $
|Industrial
    Services Group, Senior Secured First Lien Delayed Draw Term Loan, 10.84% (SOFR + 6.25%), maturity 12/7/28                                   |  | Services:
    Business                        |  |                       | 1,428,571  |  |                       |  
|EdgeCo,
    Senior Secured Delayed Draw Term D Loan (First Lien), 9.52% (LIBOR + 4.75%), maturity 6/1/26                                                   |  | Banking,
    Finance, Insurance & Real Estate |  |                       | 1,200,000  |  |                       |  
|VC3,
    Unitranche Delayed Draw Term Loan D, 9.84% (SOFR + 5.25%), maturity 3/12/27                                                                       |  | Services:
    Business                        |  |                       | 1,176,923  |  |                       |  
|Alera,
    Unitranche 2022 Delayed Draw Term Loan, 11.09% (SOFR + 6.50%), maturity 9/30/28                                                                 |  | Banking,
    Finance, Insurance & Real Estate |  |                       | 1,173,333  |  |                       |  
|Golden
    Source, Senior Secured Delayed Draw Term Loan, 10.09% (SOFR + 5.50%), maturity 5/12/28                                                          |  | High
    Tech Industries                      |  |                       | 938,967    |  |                       |  
|InterMed,
    Senior Secured Revolving Loan, 11.09% (SOFR + 6.50%), maturity 12/24/28                                                                      |  | Healthcare &
    Pharmaceuticals              |  |                       | 863,931    |  |                       |  
|Ned
    Stevens, Senior Secured Delayed Draw Term Loan, 11.34% (SOFR + 6.75%), maturity 11/1/29                                                            |  | Services:
    Consumer                        |  |                       | 846,172    |  |                       |  
|Discovery
    Education, Senior Secured Delayed Draw Term Loan (First Lien), 10.34% (SOFR + 5.75%), maturity 4/6/29                                        |  | Services:
    Business                        |  |                       | 807,692    |  |                       |  
|CPI
    International, Senior Secured Delayed Draw Term Loan, 10.09% (SOFR + 5.50%), maturity 10/6/24                                                      |  | Aerospace &
    Defense                       |  |                       | 718,563    |  |                       |  
|Cherry
    Bekaert, Senior Secured Delayed Draw Term Loan, 10.09% (SOFR + 5.50%), maturity 6/30/28                                                         |  | Banking,
    Finance, Insurance & Real Estate |  |                       | 687,983    |  |                       |  
|Eliassen,
    Senior Secured Initial Delayed Draw Term Loan, 10.34% (SOFR + 5.75%), maturity 4/7/28                                                        |  | Services:
    Business                        |  |                       | 629,630    |  |                       |  
|A1
    Garage Door Service, Senior Secured Delayed Draw Term Loan, 11.09% (SOFR + 6.50%), maturity 12/23/28                                                |  | Construction &
    Building                   |  |                       | 625,344    |  |                       |  
|Industrial
    Services Group, Senior Secured Revolver, 10.84% (SOFR + 6.25%), maturity 12/7/28                                                            |  | Services:
    Business                        |  |                       | 571,429    |  |                       |  
|RevHealth,
    Senior Secured Revolving Loan, 10.34% (SOFR + 5.75%), maturity 7/22/28                                                                      |  | Healthcare &
    Pharmaceuticals              |  |                       | 513,699    |  |                       |  
|Vertellus,
    Senior Secured Revolving Credit Loan, 10.34% (SOFR + 5.75%), maturity 12/22/25                                                              |  | Chemicals,
    Plastics & Rubber              |  |                       | 486,239    |  |                       |  
|Golden
    Source, Senior Secured Revolving Loan, 10.09% (SOFR + 5.50%), maturity 5/12/28                                                                  |  | High
    Tech Industries                      |  |                       | 469,484    |  |                       |  
|CoolSys,
    Senior Secured Delayed Draw Term Loan, 9.52% (LIBOR + 4.75%), maturity 8/11/28                                                                |  | Services:
    Business                        |  |                       | 465,278    |  |                       |  
|Advancing
    Eyecare, Senior Secured Initial Delayed Draw Term Loan, 10.34% (SOFR + 5.75%), maturity 6/29/29                                              |  | Healthcare &
    Pharmaceuticals              |  |                       | 462,000    |  |                       |  
|Cherry
    Bekaert, Senior Secured Revolving Credit Loan, 10.09% (SOFR + 5.50%), maturity 6/30/28                                                          |  | Banking,
    Finance, Insurance & Real Estate |  |                       | 431,530    |  |                       |  
|Blue
    Cloud, Senior Secured Delayed Draw Term Loan, 9.59% (SOFR + 5.00%), maturity 1/21/28                                                              |  | Healthcare &
    Pharmaceuticals              |  |                       | 400,000    |  |                       |  
|Micro
    Merchant Systems, Senior Secured Delayed Draw Term Loan, 10.34% (SOFR + 5.75%), maturity 12/14/27                                                |  | Healthcare &
    Pharmaceuticals              |  |                       | 370,370    |  |                       |  
|InnovateMR,
    Senior Secured Revolving Loan, 10.27% (LIBOR + 5.50%), maturity 1/20/28                                                                    |  | Services:
    Business                        |  |                       | 365,388    |  |                       |  
|PracticeTek,
    Senior Secured Revolving Loan, 11.02% (LIBOR + 6.25%), maturity 11/23/27                                                                  |  | High
    Tech Industries                      |  |                       | 357,824    |  |                       |  
|Ned
    Stevens, Senior Secured Revolving Loan, 11.34% (SOFR + 6.75%), maturity 11/1/29                                                                    |  | Services:
    Consumer                        |  |                       | 338,469    |  |                       |  
|Evans
    Network, Senior Secured Delayed Draw Term Loan (First Lien), 9.02% (LIBOR + 4.25%), maturity 8/19/28                                             |  | Transportation:
    Cargo                     |  |                       | 326,531    |  |                       |  
|Burke
    Porter Group, Senior Secured Revolving Credit Loan, 10.59% (SOFR + 6.00%), maturity 7/29/28                                                      |  | Capital
    Equipment                         |  |                       | 308,344    |  |                       |  
|Paragon
    Films, Senior Secured Delayed Draw Term Loan (First Lien), 9.77% (LIBOR + 5.00%), maturity 12/16/28                                            |  | Containers,
    Packaging & Glass             |  |                       | 297,030    |  |                       |  
|MediaRadar,
    Senior Secured Revolving Loan, 10.59% (SOFR + 6.00%), maturity 7/22/28                                                                     |  | Media:
    Advertising, Printing & Publishing |  |                       | 296,296    |  |                       |  
|Cerity
    Partners, Senior Secured Initial Revolving Loan, 10.34% (SOFR + 5.75%), maturity 7/27/28                                                        |  | Banking,
    Finance, Insurance & Real Estate |  |                       | 286,738    |  |                       |  
|Beta+,
    Senior Secured Revolving Credit Loan, 9.84% (SOFR + 5.25%), maturity 7/1/27                                                                     |  | Banking,
    Finance, Insurance & Real Estate |  |                       | 276,289    |  |                       |  
|A1
    Garage Door Service, Senior Secured Revolving Loan, 11.09% (SOFR + 6.50%), maturity 12/23/28                                                        |  | Construction &
    Building                   |  |                       | 275,482    |  |                       |  
|The
    Facilities Group, Senior Secured Delayed Draw Term Loan, 10.52% (LIBOR + 5.75%), maturity 11/30/27                                                 |  | Services:
    Business                        |  |                       | 266,185    |  |                       |  
|Discovery
    Education, Senior Secured Revolving Credit Loan (First Lien), 10.34% (SOFR + 5.75%), maturity 4/7/28                                         |  | Services:
    Business                        |  |                       | 230,769    |  |                       |  
|Liberty
    Group, Senior Secured Revolving Loan, 10.34% (SOFR + 5.75%), maturity 6/9/28                                                                   |  | Services:
    Business                        |  |                       | 227,273    |  |                       |  
|Liberty
    Group, Senior Secured Delayed Draw Term Loan, 10.34% (SOFR + 5.75%), maturity 6/9/28                                                           |  | Services:
    Business                        |  |                       | 204,545    |  |                       |  
|Radwell,
    Senior Secured Delayed Draw Term Loan, 10.34% (SOFR + 5.75%), maturity 4/1/29                                                                 |  | Capital
    Equipment                         |  |                       | 200,001    |  |                       |  
|USALCO,
    Senior Secured Revolving Loan, 10.77% (LIBOR + 6.00%), maturity 10/19/26                                                                       |  | Chemicals,
    Plastics & Rubber              |  |                       | 185,484    |  |                       |  
|Alliance
    Environmental, Senior Secured Delayed Draw Term Loan, 10.77% (LIBOR + 6.00%), maturity 12/30/27                                               |  | Environmental
    Industries                  |  |                       | 182,119    |  |                       |  
|Blue
    Cloud, Senior Secured Revolving Loan, 9.59% (SOFR + 5.00%), maturity 1/21/28                                                                      |  | Healthcare &
    Pharmaceuticals              |  |                       | 177,273    |  |                       |  
|Ivy
    Rehab, Senior Secured Delayed Draw Term Loan (First Lien), 9.34% (SOFR + 4.75%), maturity 4/23/29                                                  |  | Healthcare &
    Pharmaceuticals              |  |                       | 176,471    |  |                       |  
|Epic
    Staffing Group, Senior Secured Delayed Draw Term Loan, 10.59% (SOFR + 6.00%), maturity 6/28/29                                                    |  | Healthcare &
    Pharmaceuticals              |  |                       | 174,419    |  |                       |  
|Ivy
    Rehab, Senior Secured Revolving Credit Loan (First Lien), 9.34% (SOFR + 4.75%), maturity 4/21/28                                                   |  | Healthcare &
    Pharmaceuticals              |  |                       | 168,350    |  |                       |  
|EPIC
    Insurance, Senior Secured Revolving Loan, 10.02% (LIBOR + 5.25%), maturity 9/30/27                                                                |  | Banking,
    Finance, Insurance & Real Estate |  |                       | 161,841    |  |                       |  
|Integro,
    Senior Secured 2022 Refinancing Term Loan (First Lien), 12.25% (Fixed), maturity 5/8/23                                                       |  | Banking,
    Finance, Insurance & Real Estate |  |                       | 161,041    |  |                       |  
|Tank
    Holding, Senior Secured Revolving Credit Loan, 10.59% (SOFR + 6.00%), maturity 3/31/28                                                            |  | Capital
    Equipment                         |  |                       | 118,154    |  |                       |  
|Community
    Brands, Senior Secured Delayed Draw Term Loan, 10.34% (SOFR + 5.75%), maturity 2/24/28                                                       |  | Banking,
    Finance, Insurance & Real Estate |  |                       | 117,647    |  |                       |  
|Hissho
    Sushi, Senior Secured Revolving Credit Loan, 10.59% (SOFR + 6.00%), maturity 5/18/28                                                            |  | Beverage,
    Food & Tobacco                  |  |                       | 114,286    |  |                       |  
|Omni
    Logistics, Senior Secured Revolving Credit Loan (First Lien), 9.77% (LIBOR + 5.00%), maturity 12/30/25                                            |  | Transportation:
    Cargo                     |  |                       | 113,834    |  |                       |  
|Micro
    Merchant Systems, Senior Secured Revolving Loan, 10.34% (SOFR + 5.75%), maturity 12/14/27                                                        |  | Healthcare &
    Pharmaceuticals              |  |                       | 111,111    |  |                       |  
|Cleaver
    Brooks, Senior Secured Revolving Loan, 10.34% (SOFR + 5.75%), maturity 7/31/28                                                                 |  | Capital
    Equipment                         |  |                       | 107,692    |  |                       |  
|FLS
    Transportation, Senior Secured Revolving Credit Loan, 10.02% (LIBOR + 5.25%), maturity 12/17/27                                                    |  | Transportation:
    Cargo                     |  |                       | 88,889     |  |                       |  
|Insight
    Global, Senior Secured Revolving Loan, 10.77% (LIBOR + 6.00%), maturity 9/22/27                                                                |  | Services:
    Business                        |  |                       | 80,507     |  |                       |  
|Radwell,
    Senior Secured Revolving Loan, 10.34% (SOFR + 5.75%), maturity 4/1/28                                                                         |  | Capital
    Equipment                         |  |                       | 79,998     |  |                       |  
|VC3,
    Senior Secured Revolving Credit, 9.84% (SOFR + 5.25%), maturity 3/12/27                                                                           |  | Services:
    Business                        |  |                       | 76,923     |  |                       |  
|CPS,
    Senior Secured Revolving Credit Loan, 10.52% (LIBOR + 5.75%), maturity 6/1/28                                                                     |  | Healthcare &
    Pharmaceuticals              |  |                       | 71,414     |  |                       |  
|Applied
    Adhesives, Senior Secured Revolving Loan, 9.52% (LIBOR + 4.75%), maturity 3/12/27                                                              |  | Containers,
    Packaging & Glass             |  |                       | 71,111     |  |                       |  
|Omni
    Logistics, Senior Secured Tranche 2 DDTL (First Lien), 9.77% (LIBOR + 5.00%), maturity 12/30/26                                                   |  | Transportation:
    Cargo                     |  |                       | 68,750     |  |                       |  
|Community
    Brands, Senior Secured Revolving Loan, 10.34% (SOFR + 5.75%), maturity 2/24/28                                                               |  | Banking,
    Finance, Insurance & Real Estate |  |                       | 58,824     |  |                       |  
|Keter
    Environmental Services, Unitranche Revolving Loan, 11.27% (LIBOR + 6.50%), maturity 10/29/27                                                     |  | Environmental
    Industries                  |  |                       | 50,160     |  |                       |  
|Magnate,
    Senior Secured Delayed Draw Term Loan (First Lien), 10.27% (LIBOR + 5.50%), maturity 12/29/28                                                 |  | Transportation:
    Cargo                     |  |                       | 36,607     |  |                       |  
|Applied
    Adhesives, Senior Secured Delayed Draw Term Loan, 9.52% (LIBOR + 4.75%), maturity 3/12/27                                                      |  | Containers,
    Packaging & Glass             |  |                       | 27,721     |  |                       |  
|EPIC
    Insurance, Senior Secured Delayed Draw Term Loan, 10.02% (LIBOR + 5.25%), maturity 9/29/28                                                        |  | Banking,
    Finance, Insurance & Real Estate |  |                       | 21,877     |  |                       |  
|Forefront,
    Senior Secured Delayed Draw Term Loan, 8.84% (SOFR + 4.25%), maturity 4/1/29                                                                |  | Healthcare &
    Pharmaceuticals              |  |                       | 17,551     |  |                       |  
|Alliance
    Environmental, Senior Secured Revolving Loan, 10.77% (LIBOR + 6.00%), maturity 12/30/27                                                       |  | Environmental
    Industries                  |  |                       | 16,556     |  |                       |  
|BlueHalo,
    Senior Secured Revolving Loan, 10.77% (LIBOR + 6.00%), maturity 10/31/25                                                                     |  | Aerospace &
    Defense                       |  |                       | 7,786      |  |                       |  
|American
    Vision Partners, Senior Secured Initial DDTL Loan, 10.52% (LIBOR + 5.75%), maturity 9/30/27                                                   |  | Healthcare &
    Pharmaceuticals              |  |                       | -          |  |                       |  
|InMark,
    Senior Secured Initial Delayed Draw Term Loan Retired 06/30/2022, 10.59% (SOFR + 6.00%), maturity 12/23/26                                     |  | Containers,
    Packaging & Glass             |  |                       | -          |  |                       |  
|Advarra,
    Senior Secured Initial Revolving Loan (First Lien) Retired 08/24/2022, 9.02% (LIBOR + 4.25%), maturity 7/9/24                                 |  | Healthcare &
    Pharmaceuticals              |  |                       | -          |  |                       |  
|AmeriVet,
    Senior Secured Fifth Amendment Delayed Draw Term Loan, 9.52% (LIBOR + 4.75%), maturity 6/5/24                                                |  | Healthcare &
    Pharmaceuticals              |  |                       | -          |  |                       |  
|Brook &
    Whittle, Senior Secured Delayed Draw Term Loan (First Lien) Retired 08/31/2022, 8.59% (SOFR + 4.00%), maturity 12/14/28                        |  | Containers,
    Packaging & Glass             |  |                       | -          |  |                       |  
|Therapy
    Brands, Senior Secured Delayed Draw Term Loan (First Lien) Retired 12/21/2022, 8.77% (LIBOR + 4.00%), maturity 5/18/28                         |  | Healthcare &
    Pharmaceuticals              |  |                       | -          |  |                       |  
|Dessert
    Holdings, Senior Secured Delayed Draw Term Loan (First Lien) Retired 10/28/2022, 8.77% (LIBOR + 4.00%), maturity 6/9/28                        |  | Beverage,
    Food & Tobacco                  |  |                       | -          |  |                       |  
|Capstone
    Logistics, Senior Secured Initial DDTL Loan (First Lien), 9.52% (LIBOR + 4.75%), maturity 11/12/27                                            |  | Transportation:
    Cargo                     |  |                       | -          |  |                       |  
|Service
    Logic, Senior Secured Delayed Draw Term Loan (First Lien) Retired 10/28/2022, 8.77% (LIBOR + 4.00%), maturity 10/29/27                         |  | Services:
    Business                        |  |                       | -          |  |                       |  
|Ned
    Stevens, Senior Secured Revolving Loan Retired 07/01/2022, 9.52% (LIBOR + 4.75%), maturity 9/30/24                                                 |  | Services:
    Consumer                        |  |                       | -          |  |                       |  
|Alpaca,
    Senior Secured Revolver, 9.77% (LIBOR + 5.00%), maturity 4/19/24                                                                               |  | Healthcare &
    Pharmaceuticals              |  |                       | -          |  |                       |  
|Therma
    Holdings, Senior Secured Initial DDTL (2021), 8.52% (LIBOR + 3.75%), maturity 12/16/27                                                          |  | Services:
    Business                        |  |                       | -          |  |                       |  
|Gastro
    Health, Senior Secured Delayed Draw Term Loan (First Lien), 9.27% (LIBOR + 4.50%), maturity 7/3/28                                              |  | Healthcare &
    Pharmaceuticals              |  |                       | -          |  |                       |  
|Tekni-Plex,
    Senior Secured Tranche B-3 DDTL Term Loan Retired 12/30/2022, 8.77% (LIBOR + 4.00%), maturity 9/15/28                                      |  | Containers,
    Packaging & Glass             |  |                       | -          |  |                       |  
|Flow
    Control Group, Senior Secured Amendment No. 1 Delayed Draw Term Loan (First Lien) Retired 03/31/2022, 8.52% (LIBOR + 3.75%),
    maturity 3/31/28 |  | Capital
    Equipment                         |  |                       | -          |  |                       |  
|Alpaca,
    Senior Secured Delayed Draw Term A Loan, 10.02% (LIBOR + 5.25%), maturity 4/19/24                                                              |  | Healthcare &
    Pharmaceuticals              |  |                       | -          |  |                       |  
|ImageFirst,
    Senior Secured Delayed Draw Tranche A Term Loan Retired 01/07/2022, 9.27% (LIBOR + 4.50%), maturity 4/27/28                                |  | Healthcare &
    Pharmaceuticals              |  |                       | -          |  |                       |  
|Solis
    Mammography, Senior Secured Delayed Draw Term Loan (First Lien) Retired 10/19/2022, 9.52% (LIBOR + 4.75%), maturity 4/17/28                      |  | Healthcare &
    Pharmaceuticals              |  |                       | -          |  |                       |  
|                                                                                                                                                           |  |                                               |  | $                     | 24,258,010 |  |                       | $



Unfunded commitments represent all amounts unfunded as of
December 31, 2022 and 2021. These amounts may or may not be funded to the borrowing party now or in the future.





106







Note 10. Financial Highlights



|                                                                                                                    |  | Year Ended December  31, 2022 |             |   | Year Ended December  31, 2021 |   |             | Year Ended December  31, 2020 |  |   | Year Ended December  31, 2019 |   |  | Year Ended December  31, 2018 |            
|------------------------------------------------------------------------------------------------------------------- |  | ----------------------------- | ----------- | - | ----------------------------- | - | ----------- | ----------------------------- |  | - | ----------------------------- | - |  | ----------------------------- | -----------
|Per Share Data:                                                                                                     |  |                               |             |   |                               |   |             |                               |  |   |                               |   |  |                               |            
|Net asset value, beginning of period                                                                                |  | $                             | 9.36        |   |                               | $ | 9.31        |                               |  | $ | 9.44                          |   |  | $                             | 9.46       
|Net investment
    income(a)                                                                                        |  |                               | 0.53        |   |                               |   | 0.39        |                               |  |   | 0.42                          |   |  |                               | 0.52       
|Net realized gain
  (loss) on investments and change in unrealized (depreciation) appreciation on investments(a)(b) |  |                               | (0.11       | ) |                               |   | 0.06        |                               |  |   | (0.12                         | ) |  |                               | (0.02      
|Net increase in net assets resulting from operations                                                                |  | $                             | 0.42        |   |                               | $ | 0.45        |                               |  | $ | 0.30                          |   |  | $                             | 0.50       
|                                                                                                                    |  |                               |             |   |                               |   |             |                               |  |   |                               |   |  |                               |            
|Effect of equity capital activity                                                                                   |  |                               |             |   |                               |   |             |                               |  |   |                               |   |  |                               |            
|Distributions to stockholders from net investment income                                                            |  |                               | (0.53       | ) |                               |   | (0.39       | )                             |  |   | (0.42                         | ) |  |                               | (0.52      
|Distributions to stockholders from capital gains                                                                    |  |                               | -           |   |                               |   | -           |                               |  |   | -                             |   |  |                               | -          
|Distributions to stockholders from return of capital                                                                |  |                               | (0.01       | ) |                               |   | (0.01       | )                             |  |   | (0.01                         | ) |  |                               | -          
|Net asset value at end of period                                                                                    |  | $                             | 9.24        |   |                               | $ | 9.36        |                               |  | $ | 9.31                          |   |  | $                             | 9.44       
|Total
    return(c)                                                                                                 |  |                               | 4.45        | % |                               |   | 4.84        | %                             |  |   | 3.22                          | % |  |                               | 5.18       
|Shares of common stock outstanding at end of period                                                                 |  |                               | 46,376,461  |   |                               |   | 39,961,408  |                               |  |   | 38,343,580                    |   |  |                               | 35,109,246 
|                                                                                                                    |  |                               |             |   |                               |   |             |                               |  |   |                               |   |  |                               |            
|Statement of Assets and Liabilities Data:                                                                           |  |                               |             |   |                               |   |             |                               |  |   |                               |   |  |                               |            
|Net assets at end of period                                                                                         |  | $                             | 428,477,678 |   |                               | $ | 373,947,334 |                               |  | $ | 356,882,861                   |   |  | $                             | 331,399,673
|Average
    net assets(d)                                                                                           |  |                               | 419,846,471 |   |                               |   | 372,049,959 |                               |  |   | 350,696,066                   |   |  |                               | 316,110,129
|                                                                                                                    |  |                               |             |   |                               |   |             |                               |  |   |                               |   |  |                               |            
|Ratio/Supplemental Data:                                                                                            |  |                               |             |   |                               |   |             |                               |  |   |                               |   |  |                               |            
|Ratio
    of gross expenses to average net assets(e)                                                                |  |                               | 2.39        | % |                               |   | 1.61        | %                             |  |   | 1.92                          | % |  |                               | 2.32       
|Ratio
    of net expenses to average net assets(f)                                                                  |  |                               | 1.39        | % |                               |   | 1.05        | %                             |  |   | 1.10                          | % |  |                               | 1.29       
|Ratio of net investment income to average net assets                                                                |  |                               | 5.67        | % |                               |   | 4.18        | %                             |  |   | 4.54                          | % |  |                               | 5.37       
|Portfolio turnover                                                                                                  |  |                               | 4.94        | % |                               |   | 4.15        | %                             |  |   | 4.76                          | % |  |                               | 2.91       





| | (a) | Based
on weighted average basic per share of Common Stock data.
| | --- | ---------------------------------------------------------------

| | (b) | The
per share amount varies from the net realized and unrealized gain (loss) for the period because of the timing of sales of fund shares
and the per share amount of realized and unrealized gains and losses at such time.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (c) | Total
return is based on the change in net asset value during the respective periods.  Total return also takes into account dividends
and distributions, if any, reinvested in accordance with the Company's dividend reinvestment plan.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (d) | Average
net assets are computed using the average balance of net assets at the end of each month of the reporting  period.
| | --- | --------------------------------------------------------------------------------------------------------------------------

| | (e) | Ratio
of gross expenses to average net assets is computed using expenses before waivers from the Adviser and Administrator.
| | --- | ---------------------------------------------------------------------------------------------------------------------------

| | (f) | Ratio
of net expenses to average net assets is computed using total expenses net of waivers from the Adviser and Administrator.
| | --- | -------------------------------------------------------------------------------------------------------------------------------













107







Note 11. Selected Quarterly Financial Data (Unaudited)



|                                                                                                |  | Quarter Ended
 December 31, 
2022 |             |   | Quarter Ended
 December 31, 
2021 |   |             | Quarter Ended
 December 31, 
2020 | 
|----------------------------------------------------------------------------------------------- |  | --------------------------------- | ----------- | - | --------------------------------- | - | ----------- | --------------------------------- | 
|Statement of Operations Data:                                                                   |  |                                   |             |   |                                   |   |             |                                   | 
|Income                                                                                          |  |                                   |             |   |                                   |   |             |                                   | 
|Total investment income                                                                         |  | $                                 | 9,752,434   |   |                                   | $ | 4,924,605   |                                   | 
|Expenses                                                                                        |  |                                   |             |   |                                   |   |             |                                   | 
|Net expense                                                                                     |  |                                   | 1,806,164   |   |                                   |   | 983,103     |                                   | 
|Net investment income                                                                           |  |                                   | 7,946,270   |   |                                   |   | 3,941,502   |                                   | 
|Net realized gain (loss) on investments                                                         |  |                                   | 422,684     |   |                                   |   | 253,950     |                                   | 
|Net change in unrealized (depreciation) appreciation on investments                             |  |                                   | (1,034,430  | ) |                                   |   | 23,299      |                                   | 
|Net increase in net assets resulting from operations                                            |  | $                                 | 7,334,524   |   |                                   | $ | 4,218,751   |                                   | 
|                                                                                                |  |                                   |             |   |                                   |   |             |                                   | 
|Per Share Data:                                                                                 |  |                                   |             |   |                                   |   |             |                                   | 
|Net investment income per common share - basic and diluted(a)                                   |  | $                                 | 0.21        |   |                                   | $ | 0.10        |                                   | 
|Net increase in
  net assets resulting from operations percommon share -
  basic and diluted(a) |  |                                   | 0.16        |   |                                   |   | 0.11        |                                   | 
|Distributions declared per common share                                                         |  |                                   | 0.34        |   |                                   |   | 0.20        |                                   | 
|                                                                                                |  |                                   |             |   |                                   |   |             |                                   | 
|Statement of Assets and Liabilities Data:                                                       |  |                                   |             |   |                                   |   |             |                                   | 
|Total assets                                                                                    |  | $                                 | 443,650,195 |   |                                   | $ | 415,183,495 |                                   | 
|Total liabilities                                                                               |  |                                   | 15,172,517  |   |                                   |   | 41,236,161  |                                   | 
|Net assets                                                                                      |  |                                   | 428,477,678 |   |                                   |   | 373,947,334 |                                   | 
|Net asset value per common share                                                                |  |                                   | 9.24        |   |                                   |   | 9.36        |                                   | 
|Common shares outstanding                                                                       |  |                                   | 46,376,461  |   |                                   |   | 39,961,408  |                                   | 
|Weighted common shares outstanding - basic and diluted                                          |  |                                   | 45,106,946  |   |                                   |   | 39,961,406  |                                   | 
|                                                                                                |  |                                   |             |   |                                   |   |             |                                   | 
|Other Data:                                                                                     |  |                                   |             |   |                                   |   |             |                                   | 
|Number of portfolio investments                                                                 |  |                                   | 252         |   |                                   |   | 251         |                                   | 
|Average investment amount(b)                                                                    |  | $                                 | 1,697,226   |   |                                   | $ | 1,610,728   |                                   | 
|Percentage of investments at floating rates(b)                                                  |  |                                   | 99.41       | % |                                   |   | 100.00      | %                                 | 



| | (a) | Per share data is based on weighted average common stock outstanding
for both basic and diluted.
| | --- | ------------------------------------------------------------------------------------------------

| | (b) | Based on cost of investments.
| | --- | -----------------------------



Note 12. Federal Tax Information (Unaudited)



Qualified interest income is exempt from nonresident alien
(NRA) tax withholding. The percentage of the Fund’s ordinary income distributions derived from qualified interest income was 100%.



Note 13. Indemnification



In the normal course of business, the Company may enter
into certain contracts that provide a variety of indemnities. The Company’s maximum exposure under these indemnities is unknown.
The Company does not consider it necessary to record a liability in this regard.



Note 14. Subsequent Events



Subsequent to December 31, 2022 through March 20,
2023, the Company invested $4,512,369 at cost in 27 different portfolio companies.





108







On January 9, 2023, the Company issued a Tender Offer
to repurchase $15.0 million worth of Common Stock. The Offer was accepted on February 7, 2023.



On March 8, 2023, the Company adopted Rule 2a-5
under the 1940 Act, which establishes an updated regulatory framework for determining fair value in good faith for purposes of the 1940
Act. The adopted rule clarifies how fund boards can satisfy their valuation obligations in light of recent market developments.
The rule permits boards, subject to board oversight and certain other conditions, to designate certain parties to perform the fair
value determinations.



The sale of Common Stock was made pursuant to a subscription
agreement entered into by the Company and the investor. Under the terms of the subscription agreement, the investor is required to fund
drawdowns to purchase shares of Common Stock up to the amount of its capital commitment on an as-needed basis with a minimum of 10 calendar
days’ prior notice.



The issuance of the Common Stock is exempt from the registration
requirements of the Securities Act of 1933, as amended, pursuant to Section 4(a)(2) thereof. The Company has not engaged in
general solicitation or advertising with regard to the issuance and sale of the Common Stock and has not offered securities to the public
in connection with such issuance and sale.





109







ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
AND FINANCIAL DISCLOSURE



None.



ITEM 9A. CONTROLS AND PROCEDURES



Disclosure Controls and Procedures



As of December 31, 2022 (the end of the period covered by this
annual report), our management, including our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness and design
and operation of our disclosure controls and procedures. Based on that evaluation, our management, including the Chief Executive Officer
and Chief Financial Officer, concluded that our disclosure controls and procedures were effective at a reasonable assurance level in
timely alerting management, including the Chief Executive Officer and Chief Financial Officer, of material information about us required
to be included in periodic SEC filings. However, in evaluation of 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 possible
controls and procedures.



Changes in Internal Control Over Financial Reporting



There have been no changes in our internal control over financial
reporting, as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act, that occurred during our most recently
completed fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial
reporting.



Management’s Report on Internal Control Over Financial
Reporting



The management of Audax Credit BDC Inc. (“we”
and “our”) is responsible for establishing and maintaining adequate internal control over financial reporting. Our internal
control system is a process designed to provide reasonable assurance to our management and Board of Directors regarding the preparation
and fair presentation of published financial statements.



Our internal control over financial reporting
includes policies and procedures that pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect
transactions recorded necessary to permit the preparation of financial statements in accordance with U.S. generally accepted accounting
principles. Our policies and procedures also provide reasonable assurance that receipts and expenditures are being made only in accordance
with authorizations of our management and directors, and provide reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use or disposition of our assets that could have a material effect on our financial statements.



All internal control systems, no matter how well
designed, have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with
respect to financial statement preparation and presentation. Also, projections of any evaluation of effectiveness as to future periods
are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the
policies or procedures may deteriorate.



Management assessed the effectiveness of our
internal control over financial reporting as of December 31, 2022. In making this assessment, we used the criteria set forth by
the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control — Integrated Framework issued
in 2013. Based on the assessment, management believes that, as of December 31, 2022, our internal control over financial reporting
is effective based on those criteria.





110







The independent registered public accounting
firm that audited our financial statements has not issued an audit report on the effectiveness of our internal control over financial
reporting, due to exemptions for non-accelerated filers under the Sarbanes-Oxley Act of 2002, as amended, and for emerging growth companies
under the Jumpstart Our Business Startups Act of 2012, as amended.



ITEM 9B. OTHER INFORMATION



Not applicable.





111







PART III



We will file a definitive Proxy Statement for our 2023 Annual Meeting
of Stockholders (the “ Proxy Statement”) with the SEC, pursuant to Regulation 14A, not later than 120 days after the end
of our fiscal year. Accordingly, certain information required by Part III has been omitted under General Instruction G (3) to
Form 10-K. Only those sections of the Proxy Statement that specifically address the items set forth herein are incorporated herein
by reference.



ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE



The information required by Item 10 is hereby incorporated by reference
from our Proxy Statement to be filed with the SEC within 120 days following the end of our fiscal year.



ITEM 11. EXECUTIVE COMPENSATION



The
information required by Item 11 is hereby incorporated by reference from our Proxy Statement to be filed with theSEC within 120
days following the end of our fiscal year.



ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
AND RELATED STOCKHOLDER MATTERS



The
information required by Item 12 is hereby incorporated by reference from our Proxy Statement to be filed with theSEC within 120
days following the end of our fiscal year.



ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
INDEPENDENCE



The
information required by Item 13 is hereby incorporated by reference from our Proxy Statement to be filed with theSEC within 120
days following the end of our fiscal year.



ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES



The
information required by Item 14 is hereby incorporated by reference from our Proxy Statement to be filed with theSEC within 120
days following the end of our fiscal year.





112







PART IV



ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES



The following documents are filed or incorporated by reference as
part of this annual report:



1. Financial Statements – refer to “Item 8. Financial
Statements and Supplementary Data” starting on page 74



2. No other financial statement schedules are filed herewith because
(1) such schedules are not required or (2) the information has been presented in the aforementioned financial statements.



3. Exhibits



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



| | 3.1 | Amended and Restated Certificate of Incorporation (Incorporated by reference
                                            to Exhibit 3.1 to the Registration Statement on Form 10 (File no. 000-55426), filed
                                            on April 17, 2015).
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 3.2 | Form of Bylaws (Incorporated by reference to Exhibit 3.2 to
                                            the Registration Statement on Form 10 (File no. 000-55426), filed on April 17,
                                            2015).
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 4.1 | Form of Subscription Agreement (Incorporated by reference to Exhibit 4.1
                                            to the Pre-Effective Amendment No. 1 to the Registration Statement on Form 10 (File
                                            no. 000-55426), filed on June 5, 2015).
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 4.2 | Description of Securities (Incorporated by reference to Exhibit 4.2
                                            to the Company’s Annual Report on Form 10-K (File no. 814-01154), filed on March 17,
                                            2020).
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 10.1 | Form ofInvestment Advisory Agreement (Incorporated by reference to Exhibit 10.1 to the
                                            Pre-Effective Amendment No. 1 to the Registration Statement on Form 10 (File no.
                                            000-55426), filed on June 5, 2015).
| | ---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 10.2 | Form of Administration Agreement (Incorporated by reference to Exhibit 10.2
                                            to the Pre-Effective Amendment No. 1 to the Registration Statement on Form 10 (File
                                            no. 000-55426), filed on June 5, 2015).
| | ---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 10.3 | Form of License Agreement (Incorporated by reference to Exhibit 10.3
                                            to the Pre-Effective Amendment No. 1 to the Registration Statement on Form 10 (File
                                            no. 000-55426), filed on June 5, 2015).
| | ---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 10.4 | Form of Indemnification Agreement (Incorporated by reference to
                                            Exhibit 10.4 to the Pre-Effective Amendment No. 1 to the Registration Statement
                                            on Form 10 (File no. 000-55426), filed on June 5, 2015).
| | ---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 10.5 | Custodial Agreement, dated as of July 8, 2015, by and between the
                                            Company and Wells Fargo Bank, National Association (Incorporated by reference to Exhibit 10.1
                                            to the Current Report on Form 8-K (File no. 814-01154), filed on July 14, 2015).
| | ---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 10.6 | Management Fee Waiver Agreement, dated as of July 8, 2015, by and
                                            between the Company and the Adviser (Incorporated by reference to Exhibit 10.1 to the
                                            Current Report on Form 8-K (File no. 814-01154), filed on July 14, 2015).
| | ---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 10.7 | Subscription Agreement, dated as of December 2, 2016, by and between
                                            the Company and Mercer Audax Credit Feeder Fund LP (Incorporated by reference to Exhibit 10.7
                                            to the Company’s Annual Report on Form 10-K (File no. 814-01154), filed on March 29,
                                            2017).
| | ---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





113







| | 10.8 | Subscription Agreement, dated as of December 7, 2017, by and between
                                            the Company and Mercer Audax Credit Feeder Fund LP (Incorporated by reference to Exhibit 10.8
                                            to the Company’s Annual Report on Form 10-K (File no. 814-01154), filed on March 16,
                                            2018).
| | ---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 10.9 | Subscription Agreement, dated as of March 22, 2019, by and between
                                            the Company and Mercer Audax Credit Feeder Fund LP (Incorporated by reference to Exhibit 10.1
                                            to the Company’s Quarterly Report on Form 10-Q (File no. 814-01154), filed on
                                            May 15, 2019).
| | ---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 10.10 | Subscription Agreement, dated as of September 23, 2019, by and
                                            between the Company and Mercer Audax Credit Feeder Fund LP. (Incorporated by reference to
                                            Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q (File no. 814-01154),
                                            filed on November 14, 2019).
| | ----- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 10.11 | Subscription Agreement, dated as of March 20, 2020, by and between
                                            the Company and Mercer Audax Credit Feeder Fund LP. (Incorporated by reference to Exhibit 10.1
                                            to the Company’s Quarterly Report on Form 10-Q (File no. 814-01154), filed on
                                            June 18, 2020).
| | ----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 10.12 | Subscription Agreement, dated as of May 28, 2021, by and between
                                            the Company and Mercer Audax Credit Feeder Fund LP. (Incorporated by reference to Exhibit 10.1
                                            to the Company’s Quarterly Report on Form 10-Q (File no. 814-01154), filed on
                                            August 13, 2021).
| | ----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 14.1 | Code of Business Conduct (Incorporated by reference to Exhibit 14.1
                                            to the Pre-Effective Amendment No. 1 to the Registration Statement on Form 10 (File
                                            no. 000-55426), filed on June 5, 2015).
| | ---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 14.2 | Code of Ethics (Incorporated by reference to Exhibit 99.1 to the
                                            Pre-Effective Amendment No. 1 to the Registration Statement on Form 10 (File No. 000-55426),
                                            filed on June 5, 2015).
| | ---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 31.1* | Certification of Chief Executive Officer pursuant to Rule 13a-14(a) under
the Securities Exchange Act of 1934, as amended.
| | ----- | --------------------------------------------------------------------------------------------------------------------------



| | 31.2* | Certification of Chief Financial Officer pursuant to Rule 13a-14(a) under
the Securities Exchange Act of 1934, as amended.
| | ----- | --------------------------------------------------------------------------------------------------------------------------



| | 32.1* | Certification of Chief Executive Officer pursuant to 18 U.S.C.
Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, as amended (18 U.S.C. 1350).
| | ----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 32.2* | Certification of Chief Financial Officer pursuant to 18 U.S.C.
Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, as amended (18 U.S.C. 1350).
| | ----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 99.1 | Administrative Fee Waiver Letter, dated as of November 10, 2016,
                                            by and between the Company and the Administrator (Incorporated by reference to Exhibit 99.2
                                            to the Quarterly Report on Form 10-Q, File No. 814-01154, filed on November 14,
                                            2016).
| | ---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------








*            Filed
herewith





114







SIGNATURES



Pursuant to
the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this
report
to be signed on its behalf by the undersigned thereunto duly authorized.



Audax Credit BDC Inc.



|Date: March 20,
2023 | By: | /s/ Michael P. McGonigle                                                      
|-------------------- | --- | ------------------------------------------------------------------------------
|                     |     | Michael P. McGonigle                                                          
|                     |     | Chairman
    of the Board of Directors, President, and Chief Executive Officer





|Date: March 20, 2023 | By: | /s/ Richard T. Joseph                
|-------------------- | --- | -------------------------------------
|                     |     | Richard T. Joseph                    
|                     |     | Chief Financial Officer and Treasurer



Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.



|Date: March 20, 2023 | By: | /s/ Michael P. McGonigle                                                                                
|-------------------- | --- | --------------------------------------------------------------------------------------------------------
|                     |     | Michael P. McGonigle                                                                                    
|                     |     | Chairman of the Board of Directors, President, and Chief Executive Officer (principal executive officer)



|Date: March 20, 2023 | By: | /s/ Richard T. Joseph                                                             
|-------------------- | --- | ----------------------------------------------------------------------------------
|                     |     | Richard T. Joseph                                                                 
|                     |     | Chief Financial Officer and Treasurer (principal financial and accounting officer)



|Date: March 20, 2023 | By: | /s/ Kevin P. Magid
|-------------------- | --- | ------------------
|                     |     | Kevin P. Magid    
|                     |     | Director          



|Date: March 20, 2023 | By: | /s/ Patrick H. Dowling
|-------------------- | --- | ----------------------
|                     |     | Patrick H. Dowling    
|                     |     | Director              



|Date: March 20, 2023 | By: | /s/ David G. Moyer
|-------------------- | --- | ------------------
|                     |     | David G. Moyer    
|                     |     | Director          



|Date: March 20, 2023 | By: | /s/ Joseph F. Nemia
|-------------------- | --- | -------------------
|                     |     | Joseph F. Nemia    
|                     |     | Director