ARES CAPITAL CORP 8-K

What Happened

• Ares Capital Corporation announced on May 11, 2026 that it entered into a Sixth Supplemental Indenture and issued $800,000,000 aggregate principal amount of 5.550% notes due January 15, 2030 (the "Notes"). The Notes are unsecured obligations of the company, pay interest semiannually on January 15 and July 15 beginning January 15, 2027, and may be redeemed at the company's option per the Indenture.
• The company closed the offering May 11, 2026 following a Purchase Agreement dated May 4, 2026 with several underwriters. Ares also entered an interest‑rate swap with JPMorgan Chase Bank, N.A. (notional $800M) under which the company receives fixed 5.550% and pays one‑month SOFR + 1.69950%, maturing January 15, 2030.
• Ares expects to use net proceeds to repay certain outstanding borrowings under its credit facilities; it may reborrow for general corporate purposes, including investments in portfolio companies.

Key Details

• Issuance size: $800,000,000 principal.
• Coupon and maturity: 5.550% interest, due January 15, 2030; interest payable semiannually (Jan 15 & Jul 15), first payment Jan 15, 2027.
• Swap: $800,000,000 notional; company receives fixed 5.550%, pays 1‑month SOFR + 1.69950%; swap matures Jan 15, 2030.
• Covenants and protections: Notes are unsecured; Indenture includes covenants tied to Investment Company Act compliance and requires providing financial information if Ares stops Exchange Act reporting. A change‑of‑control repurchase is triggered if a change of control occurs and the Notes are rated below investment grade by Fitch, Moody’s and S&P — repurchase price = 100% of principal + accrued interest.

Why It Matters

• The transaction raises $800M of long‑dated, fixed‑rate debt, which will be used to reduce borrowings under Ares’ credit facilities. That can alter the company’s leverage mix and liquidity profile.
• The interest‑rate swap converts the company’s fixed coupon exposure into a floating rate tied to one‑month SOFR (plus a spread), so Ares’ net interest cost will move with short‑term rates rather than remain purely fixed.
• Notes are unsecured and include standard covenants and a limited change‑of‑control repurchase right, which are important to creditors and investors assessing credit risk and potential liquidity or refinancing needs.