Golub Capital BDC Reports Material Agreements and Asset Changes

TL;DR

Golub Capital BDC inked new deals, ditched old ones, and moved assets around. Big changes coming.

AI Summary

On June 3, 2024, Golub Capital BDC, Inc. entered into a material definitive agreement related to its credit facility. The company also reported the termination of a material definitive agreement and the completion of an acquisition or disposition of assets. Additionally, Golub Capital BDC, Inc. created a direct financial obligation under an off-balance sheet arrangement.

Why It Matters

This filing indicates significant changes in Golub Capital BDC's financial obligations and asset structure, which could impact its financial performance and investment strategy.

Risk Assessment

Risk Level: medium — The filing details material definitive agreements, terminations, and asset transactions, suggesting potential shifts in the company's financial structure and obligations.

Key Players & Entities

• Golub Capital BDC, Inc. (company) — Registrant
• June 3, 2024 (date) — Date of earliest event reported
• 200 Park Avenue, 25th Floor, New York, NY 10166 (address) — Business and Mail Address
• 212.750.6060 (phone_number) — Business Phone

FAQ

Key Financial Figures

• $0.001 — ichregistered Common Stock, par value $0.001 per share GBDC The Nasdaq Global Se
• $0.15 — eries of special distributions totaling $0.15 per share to be distributed in quarterl
• $0.05 — be distributed in quarterly payments of $0.05 per share as follows: Special distribu
• $16.57 — y on the Nasdaq Global Select Market of $16.57 on May 31, 2024 was determined to be mo
• $14.70 — as of May 31, 2024 was estimated to be $14.70. In accordance with the terms of the Me

Filing Documents

• tm2416178d1_8k.htm (8-K) — 71KB
• tm2416178d1_ex10-1.htm (EX-10.1) — 64KB
• tm2416178d1_ex99-1.htm (EX-99.1) — 15KB
• 0001104659-24-067549.txt ( ) — 349KB
• gbdc-20240603.xsd (EX-101.SCH) — 3KB
• gbdc-20240603_lab.xml (EX-101.LAB) — 33KB
• gbdc-20240603_pre.xml (EX-101.PRE) — 22KB
• tm2416178d1_8k_htm.xml (XML) — 4KB

01

Item 1.01 Entry into a Material Definitive Agreement. On June 3, 2024, following the consummation of the Merger (as defined below), Golub Capital BDC, Inc. (the "Company"), entered into a new investment advisory agreement (the "New Investment Advisory Agreement") with GC Advisors LLC ("GC Advisors), which amends and restates the existing investment advisory agreement, dated as of August 3, 2023, by and between the Company and GC Advisors (the "Current GBDC Investment Advisory Agreement"). The New Investment Advisory Agreement amended the Current GBDC Investment Advisory Agreement in order to incorporate changes to the calculation of the incentive fee rates and the incentive fee cap. Under the New Investment Advisory Agreement, the incentive fee rates were reduced from 20.0% to 15.0%, and the incentive fee cap was reduced from 20.0% to 15.0%. None of the other material terms changed in the New Investment Advisory Agreement as compared to the Current GBDC Advisory Agreement, including the services to be provided and the calculation of the base management fee. The New Investment Advisory Agreement shall continue for the term of the Current GBDC Investment Advisory Agreement, and thereafter shall continue in effect from year to year if approved at least annually by the vote of the Board of Directors of the Company (the "Board") or by the affirmative vote of the holders of a majority of the Company's outstanding voting securities, and, in either case, if also approved by a majority of the Company's directors who are not "interested persons," as that term is defined in Investment Company Act of 1940, as amended (the "1940 Act"), of the Company or GC Advisors. The New Investment Advisory Agreement automatically terminates in the event of its assignment, as defined in the 1940 Act, by GC Advisors and may be terminated by either party without penalty no less than 60 days' written notice to the other. The holders of a majority of the Company's outstanding voting securiti

02

Item 1.02 Termination of a Material Definitive Agreement. Upon the effectiveness of the New Investment Advisory Agreement, the Current GBDC Investment Advisory Agreement was terminated.

01

Item 2.01 Completion of Acquisition or Disposition of Assets. On June 3, 2024, the Company completed its previously announced acquisition of Golub Capital BDC 3, Inc., a Maryland corporation ("GBDC 3"), pursuant to that certain Agreement and Plan of Merger (as amended, the "Merger Agreement"), dated as of January 16, 2024, by and among the Company, GBDC 3, Park Avenue Subsidiary Inc., a Maryland corporation and wholly owned subsidiary of the Company ("Merger Sub"), GC Advisors, a Delaware limited liability company and investment adviser to each of the Company and GBDC 3, and, for certain limited purposes, Golub Capital LLC. Pursuant to the Merger Agreement, Merger Sub was first merged with and into GBDC 3, with GBDC 3 as the surviving corporation (the "Initial Merger"), and, immediately following the Initial Merger, GBDC 3 was then merged with and into the Company, with the Company as the surviving company (the Initial Merger and the subsequent merger, collectively, the "Merger"). In accordance with the terms of the Merger Agreement, at the effective time of the Merger, each outstanding share of GBDC 3 common stock was converted into the right to receive 0.9138 shares of common stock, par value $0.001 per share of the Company (with GBDC 3 stockholders receiving cash in lieu of fractional shares of the Company's common stock). As a result of the Merger, the Company issued an aggregate of approximately 92,115,308 shares of its common stock to former GBDC 3 stockholders prior to any adjustment for GBDC 3 stockholders receiving cash in lieu of fractional shares. The foregoing description of the Merger Agreement is a summary only and is qualified in its entirety by reference to the full text of the Merger Agreement, a copy of which was filed by the Company as Exhibit 2.1 to its Current Report on Form 8-K filed on January 17, 2024, and Amendment No. 1 to the Agreement and Plan of Merger, a copy of which was filed by the Company as Exhibit 4(b) to Amendment No. 1 to i

03

Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant. Credit Facilities On June 3, 2024, as a result of the consummation of the Merger, the Company became party to and assumed all of GBDC 3's obligations under the Adviser Revolver and DB Credit Facility (each, as defined in GBDC 3's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2024 (the "GBDC 3 10-Q")). Information regarding the Adviser Revolver and DB Credit Facility is set forth in "Part I—Item 1. Financial Statements—Notes to Unaudited Consolidated Financial Statements—Note 8. Borrowings" in the GBDC 3 10-Q, and is incorporated into this Current Report on Form 8-K by reference. The description incorporated by reference above is only a summary of the material provisions of the Adviser Revolver and DB Credit Facility and is qualified in its entirety by reference to the Adviser Revolver and DB Credit Facility , which are filed as Exhibits 10.2 through 10.7 to this Current Report on Form 8-K. Debt Securitizations On June 3, 2024, as a result of the consummation of the Merger, the Company became party to the relevant agreements with respect to and assumed all of GBDC 3's obligations under each of the 2022-2 Debt Securitization, the 2022 Debt Securitization, and the 2021 Debt Securitization (each, as defined in the GBDC 3 10-Q). Information regarding the 2022-2 Debt Securitization, the 2022 Debt Securitization, and the 2021 Debt Securitization is set forth in "Part I—Item 1. Financial Statements—Notes to Unaudited Consolidated Financial Statements—Note 8. Borrowings" in the GBDC 3 10-Q, and is incorporated into this Current Report on Form 8-K by reference. The description incorporated by reference above is only a summary of the material provisions of the 2022-2 Debt Securitization, the 2022 Debt Securitization, and the 2021 Debt Securitization and is qualified in its entirety by reference to the 2022-2 Debt Secur

01

Item 7.01 Regulation FD Disclosure. On June 2, 2024, in connection with the anticipated closing of the Merger, the Company's board of directors declared a series of special distributions totaling $0.15 per share to be distributed in quarterly payments of $0.05 per share as follows: Special distribution #1 of $0.05 per share, which is payable on June 27, 2024 to stockholders of record on June 13, 2024; Special distribution #2 of $0.05 per share, which is payable on September 13, 2024, to stockholders of record on August 16, 2024; and Special distribution #3 of $0.05 per share, which is payable on December 13, 2024, to stockholders of record on November 29, 2024. In connection with the closing of the Merger, the closing price per share of common stock of the Company on the Nasdaq Global Select Market of $16.57 on May 31, 2024 was determined to be more than 6% greater than the Closing GBDC Net Asset Value (as defined in the Merger Agreement) as of May 31, 2024; and the Closing GBDC 3 Net Asset Value (as defined in the Merger Agreement) as of May 31, 2024 was estimated to be $14.70. In accordance with the terms of the Merger Agreement, the Company and GBDC 3 calculated the Exchange Ratio (as defined in the Merger Agreement) by first comparing the ratio of the closing price of GBDC common stock on the Nasdaq Global Select Market as of May 31, 2024, which was the Determination Date (as defined in the Merger Agreement), to the Closing GBDC Net Asset Value per share as of the Determination Date, and specifically whether such ratio is in excess of 106%. The Closing GBDC Net Asset Value and the Closing GBDC 3 Net Asset Value determinations described in this report were made pursuant to the requirements of, and solely for the purposes of, the Merger Agreement. The Closing GBDC Net Asset Value and the Closing GBDC 3 Net Asset Value were not reviewed or approved for purposes of financial statement preparation or as part of a comprehensive statement of the Company's or GB

Forward-Looking Statements

Forward-Looking Statements This Current Report on Form 8-K may contain "forward-looking facts included in this Current Report on Form 8-K may constitute forward-looking statements and are not guarantees of future performance or results and involve a number of risks and uncertainties. Actual results may differ materially from those expressed or implied in the forward-looking statements as a result of a number of factors, including those described from time to time in filings with the Securities and Exchange Commission. Such forward-looking statements may include statements preceded by, followed by or that otherwise include the words "may," "might," "will," "intend," "should," "could," "can," "would," "expect," "believe," "estimate," "anticipate," "predict," "potential," "plan" or similar words indicate forward-looking statements, although not all forward-looking statements include these words. Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including those described from time to time in filings made by the Company with the Securities and Exchange Commission ("SEC"). Certain factors could cause actual results to differ materially from those projected in these forward-looking statements. Factors that could cause actual results to differ materially include: the ability to realize the anticipated benefits of the Merger, the effect that the consummation of the Merger may have on the trading price of the Company's common stock on The Nasdaq Global Select Market, the Company's plans, expectations, objectives and intentions as a result of the Merger, the business prospects of the Company and the prospects of its portfolio companies, actual and potential conflicts of interests with GC Advisors and other affiliates of Golub Capital LLC, general economic and political trend

Financial Statements and Exhibits

Financial Statements and Exhibits. (a)

Financial statements of business acquired

Financial statements of business acquired. The financial statements of GBDC 3 required to be provided herein, were included in Amendment No. 1 to the Company's Registration Statement on Form N-14, filed on April 12, 2024, and are incorporated by reference in this Item 9.01(a). (d) Exhibits. EXHIBIT NUMBER 10.1 Fifth Amended and Restated Investment Advisory Agreement, dated as of June 3, 2024, by and between Golub Capital BDC, Inc. and GC Advisors, LLC. 10.2 Amended and Restated Revolving Loan Agreement, dated as of September 1, 2023, by and among Golub Capital BDC 3, Inc., as the borrower, and GC Advisors LLC, as the lender. (Incorporated by reference to Exhibit 10.1 to Golub Capital BDC 3, Inc.'s Current Report on Form 8-K (File No. 814-01244), filed on September 6, 2023) . 10.3 Loan Financing and Servicing Agreement, dated as of September 10, 2019, by and among GBDC 3 Funding LLC, as borrower, Golub Capital BDC 3, Inc., as equity holder and as servicer, the lenders from time to time party thereto, Deutsche Bank AG, New York Branch, as facility agent, the other agents parties thereto, each of the entities from time to time party thereto as securitization subsidiaries, and Deutsche Bank Trust Company Americas, as collateral agent and as collateral custodian (Incorporated by reference to Exhibit 10.1 to Golub Capital BDC 3, Inc.'s Current Report on Form 8-K (File No. 814-01244), filed on September 12, 2019) . 10.4 Sale and Contribution Agreement, dated as of September 10, 2019, between Golub Capital BDC 3, Inc., as seller, and GBDC 3 Funding LLC, as purchaser (Incorporated by reference to Exhibit 10.2 to Golub Capital BDC 3, Inc.'s Current Report on Form 8-K (File No. 814-01244), filed on September 12, 2019) . 10.5 Amendment No. 2 to Loan Financing and Servicing Agreement, dated as of October 29, 2021, among GBDC 3 Funding LLC, as borrower, Golub Capital BDC 3, Inc., as servicer, and Deutsche Bank AG, New York Branch, as facility agent, as

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