Audax Credit BDC 10-Q 2022 Q2 Quarterly report

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q  

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 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)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)  

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

None.

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.    Yes   ☒     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	☒	Smaller reporting company	☐
Emerging growth company	☐

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 is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes   ☐     No   ☒

The registrant had 46,933,008 shares of common stock, par value $0.001 per share, outstanding as of August 11, 2022.

AUDAX CREDIT BDC INC.

TABLE OF CONTENTS

PART I.	FINANCIAL INFORMATION:
Item 1.	Financial Statements
	Statements of Assets and Liabilities as of June 30, 2022 (unaudited) and December 31, 2021	2
	Statements of Operations for the three and six months ended June 30, 2022 (unaudited) and 2021 (unaudited)	3
	Statements of Changes in Net Assets for the six months ended June 30, 2022 (unaudited) and 2021 (unaudited)	4
	Statements of Cash Flows for the six months ended June 30, 2022 (unaudited) and 2021 (unaudited)	5
	Schedules of Investments as of June 30, 2022 (unaudited) and December 31, 2021	6
	Notes to Financial Statements (unaudited)	16
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations
	Overview	37
	Results of Operations	39
	Financial Condition, Liquidity and Capital Resources	41
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	48
Item 4.	Controls and Procedures	49
PART II.	OTHER INFORMATION:
Item 1.	Legal Proceedings	50
Item 1A.	Risk Factors	50
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	52
Item 3.	Defaults Upon Senior Securities	52
Item 4.	Mine Safety Disclosures	52
Item 5.	Other Information	52
Item 6.	Exhibits	52
SIGNATURES		53

Audax Credit BDC Inc.

Statements of Assets and Liabilities

June 30, 2022 and December 31, 2021

(Expressed in U.S. Dollars)

	June 30, 2022
	(unaudited)			December 31, 2021
Assets
Investments, at fair value
Non-Control/Non-Affiliate investments (Cost of $442,722,579 and $404,292,618, respectively)	$	436,812,969		$	403,054,374
Cash and cash equivalents		31,727,018			11,058,796
Interest receivable		1,327,335			1,043,554
Receivable from bank loan repayment		20,915			26,771
Other assets		215,000			-
Total assets	$	470,103,237		$	415,183,495
Liabilities
Accrued expenses and other liabilities	$	504,937		$	326,497
Fee due to administrator(a)		66,250			66,250
Fees due to investment advisor, net of waivers(a)		796,713			640,329
Payable for investments purchased		18,949,316			40,203,085
Payable for short-term borrowings(b)		35,894,306			-
Distribution payable		8,739,325			-
Total liabilities	$	64,950,847		$	41,236,161
Commitments and contingencies(c)
Net Assets
Common stock, $0.001 par value per share, 100,000,000 shares authorized, 43,696,762 and 39,961,408 shares issued and outstanding, respectively	$	43,697		$	39,961
Capital in excess of par value		413,668,452			378,672,161
Total distributable (loss) gain		(8,559,759	)		(4,764,788	)
Total Net Assets	$	405,152,390		$	373,947,334
Net Asset Value per Share of Common Stock at End of Period	$	9.27		$	9.36
Shares Outstanding		43,696,762			39,961,408

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

The accompanying notes are an integral part of these financial statements.

2

Audax Credit BDC Inc.

Statements of Operations

(Expressed in U.S. Dollars)

(unaudited)

	Three Months Ended			Three Months Ended			Six Months Ended			Six Months Ended
	June 30, 2022			June 30, 2021			June 30, 2022			June 30, 2021
Investment Income
Interest income
Non-Control/Non-Affiliate	$	6,062,310		$	4,762,471		$	11,452,128		$	9,531,156
Other		397			356			781			630
Total interest income		6,062,707			4,762,827			11,452,909			9,531,786
Other income
Non-Control/Non-Affiliate		140,256			15,488			178,374			63,002
Total income		6,202,963			4,778,315			11,631,283			9,594,788
Expenses
Base management fee(a)	$	1,082,214		$	948,730		$	2,120,653		$	1,862,780
Incentive fee(a)		747,892			96,455			1,174,214			387,748
Administrative fee(a)		66,250			66,250			132,500			132,500
Directors’ fees		56,250			56,250			112,500			112,500
Professional fees		210,862			144,378			292,537			237,696
Other expenses		85,257			116,707			164,434			205,930
Interest expense		95,634			-			136,800			-
Expenses before waivers from investment adviser and administrator		2,344,359			1,428,770			4,133,638			2,939,154
Base management fee waivers(a)		(378,775	)		(332,055	)		(742,229	)		(651,972	)
Incentive fee waivers(a)		(654,618	)		(86,809	)		(1,038,308	)		(348,973	)
Total expenses, net of waivers		1,310,966			1,009,906			2,353,101			1,938,209
Net Investment Income		4,891,997			3,768,409			9,278,182			7,656,579
Realized and Unrealized Gain (Loss) on Investments
Net realized gain (loss) on investments		111,779			(696,642	)		337,565			(633,372	)
Net change in unrealized (depreciation) appreciation on investments		(3,105,203	)		1,149,424			(4,671,366	)		2,275,338
Net realized and unrealized (loss) gain on investments		(2,993,424	)		452,782			(4,333,801	)		1,641,966
Net Increase in Net Assets Resulting from Operations	$	1,898,573		$	4,221,191		$	4,944,381		$	9,298,545
Basic and Diluted per Share of Common Stock:
Net investment income	$	0.11		$	0.10		$	0.21		$	0.20
Net increase in net assets resulting from operations	$	0.04		$	0.11		$	0.11		$	0.24
Weighted average shares of common stock outstanding basic diluted		44,710,073			39,009,531			43,742,436			38,983,776

^(a)  Refer to Note 4-Related Party Transactions for additional information

The accompanying notes are an integral part of these financial statements.

3

Audax Credit BDC Inc.

Statements of Changes in Net Assets

(Expressed in U.S. Dollars)

(unaudited)

	Six Months Ended June 30, 2022			Six Months Ended June 30, 2021
Operations
Net investment income	$	9,278,182		$	7,656,579
Net realized gain (loss) on investments		337,565			(633,372	)
Net change in unrealized (depreciation) appreciation on investments		(4,671,366	)		2,275,338
Net increase in net assets resulting from operations		4,944,381			9,298,545
Distributions:
Distributions of ordinary income to common stockholders		(8,739,352	)		(7,656,579	)
Return of capital to common stockholders		-			(145,326	)
Total distributions		(8,739,352	)		(7,801,905	)
Capital Share Transactions:
Issuance of common stock		55,000,000			6,200,000
Repurchases of common stock		(20,000,000	)		-
Reinvestment of common stock		27			25
Net increase in net assets from capital share transactions		35,000,027			6,200,025
Net Increase in Net Assets		31,205,056			7,696,665
Net Assets, Beginning of Period		373,947,334			356,882,861
Net Assets, End of Period	$	405,152,390		$	364,579,526

The accompanying notes are an integral part of these financial statements.

4

Audax Credit BDC Inc.

Statements of Cash Flows

(Expressed in U.S. Dollars)

(unaudited)

	Six Months Ended			Six Months Ended
	June 30, 2022			June 30, 2021
Cash flows from operating activities:
Net increase in net assets resulting from operations	$	4,944,381		$	9,298,545
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		(337,565	)		633,372
Net change in unrealized depreciation (appreciation) on investments		4,671,366			(2,275,338	)
Accretion of original issue discount interest and payment-in-kind interest		(371,920	)		(380,092	)
Increase in receivable from investments sold		-			(229,794	)
Increase in interest receivable		(283,781	)		(43,595	)
Decrease (increase) in receivable from bank loan repayment		5,856			(22,493	)
Increase in other assets		(215,000	)		(97,500	)
Increase in distribution payable		8,739,325			-
Increase (decrease) in accrued expenses and other liabilities		178,440			(125,942	)
Increase in fees due to investment advisor(a)		156,384			11,476
(Decrease) increase in payable for investments purchased		(21,253,769	)		8,614,905
Investment activity:
Investments purchased		(74,837,576	)		(55,617,977	)
Proceeds from investments sold		4,047,932			10,135,008
Repayment of bank loans		33,069,168			47,805,480
Total investment activity		(37,720,476	)		2,322,511
Net cash (used in) provided by operating activities		(41,486,759	)		17,706,055
Cash flows from financing activities:
Issuance of shares of common stock		55,000,000			6,200,000
Repurchases of shares of common stock		(20,000,000	)		-
Distributions paid to common stockholders		(8,739,325	)		(7,801,880	)
Short-term borrowings		35,894,306			-
Net cash provided by (used in) financing activities		62,154,981			(1,601,880	)
Net increase in cash and cash equivalents		20,668,222			16,104,175
Cash and cash equivalents:
Cash and cash equivalents, beginning of period		11,058,796			4,289,122
Cash and cash equivalents, end of period	$	31,727,018		$	20,393,297
Supplemental cash flow information
Interest paid on short-term financing	$	136,800		$	-
Supplemental non-cash information
Issuance of common shares in connection with dividend reinvestment plan	$	27		$	25
Payment-in-kind (“PIK”) interest income	$	69,132		$	110,285

^(a) Refer to Note 4-Related Party Transactions for additional information

The accompanying notes are an integral part of these financial statements.

5

Audax Credit BDC Inc.

Schedule of Investments

As of June 30, 2022

(Expressed in U.S. Dollars)

(unaudited)

Portfolio Investments (a) (b) (c) (d) (e) (f)	Acquisition Date	Par		Cost			Value
BANK LOANS: NON-CONTROL/NON-AFFILIATE INVESTMENTS - (107.2%)(g)(h):
Healthcare & Pharmaceuticals
Advarra, Senior Secured Initial Term Loan (First Lien), 6.54% (LIBOR + 4.25%), maturity 7/9/26	6/26/2019	$	4,124,436	$	4,098,846		$	4,124,432
Radiology Partners, Senior Secured Term B Loan (First Lien), 4.25% (LIBOR + 4.25%), maturity 7/9/25 (i)	6/28/2018		4,215,792		4,339,776			3,880,055
Young, Senior Secured Initial Term Loan (First Lien), 6.29% (LIBOR + 4.00%), maturity 11/7/24	11/6/2017		3,735,868		3,729,299			3,698,509
American Vision Partners, Unitranche, 6.50% (LIBOR + 5.75%), maturity 9/30/27 (j) (k)	9/22/2021		3,740,843		3,680,945			3,681,371
InHealth Medical Alliance, Senior Secured Initial Term Loan, 8.29% (LIBOR + 6.00%), maturity 6/28/28	6/25/2021		3,473,750		3,443,060			3,360,853
PharMedQuest, Unitranche, 6.75% (LIBOR + 5.75%), maturity 10/31/24 (j)	11/6/2019		3,285,898		3,260,151			3,285,898
Zest Dental, Senior Secured Initial Term Loan (First Lien), 5.79% (LIBOR + 3.50%), maturity 3/14/25	5/30/2018		3,230,629		3,241,922			3,230,629
Waystar, Senior Secured Initial Term Loan (First Lien), 6.29% (LIBOR + 4.00%), maturity 10/22/26	9/19/2019		2,934,962		2,928,498			2,912,950
Advancing Eyecare, Senior Secured Initial Term Loan, 6.25% (SOFR + 5.75%), maturity 6/29/29 (i)	5/27/2022		2,500,000		2,437,500			2,437,500
Zelis RedCard, Senior Secured Term B-1 Loan, 3.50% (LIBOR + 3.50%), maturity 9/30/26 (i)	9/27/2019		2,408,415		2,399,209			2,313,859
Premise Health, Senior Secured Initial Term Loan (First Lien), 5.79% (LIBOR + 3.50%), maturity 7/10/25	8/15/2018		2,270,804		2,275,385			2,270,804
Soliant, Senior Secured Initial Term Loan, 6.54% (LIBOR + 4.25%), maturity 3/31/28	3/26/2021		2,115,249		2,099,513			2,115,249
nThrive, Senior Secured Initial Loan (Second Lien), 9.04% (LIBOR + 6.75%), maturity 12/17/29	11/19/2021		2,000,000		1,973,000			1,990,000
CPS, Unitranche, 5.75% (LIBOR + 5.75%), maturity 5/27/28 (j)	5/18/2022		1,958,442		1,953,524			1,958,442
Gastro Health, Senior Secured Initial Term Loan (First Lien), 6.79% (LIBOR + 4.50%), maturity 7/3/28	7/2/2021		1,984,763		1,975,763			1,954,991
Upstream Rehabilitation, Senior Secured August 2021 Incremental Term Loan (First Lien), 6.54% (LIBOR + 4.25%), maturity 11/20/26	10/24/2019		1,961,438		1,958,839			1,946,727
Avalign Technologies, Senior Secured Initial Term Loan (First Lien), 6.79% (LIBOR + 4.50%), maturity 12/22/25	12/19/2018		1,930,000		1,920,338			1,881,750
Advanced Diabetes Supply, Senior Secured First Incremental Term Loan, 7.54% (LIBOR + 5.25%), maturity 12/30/27	7/13/2021		1,862,975		1,846,440			1,862,975
Press Ganey, Senior Secured Initial Term Loan (First Lien), 3.50% (LIBOR + 3.50%), maturity 7/24/26 (i)	7/23/2019		1,945,000		1,940,367			1,837,787
Blue Cloud, Unitranche, 6.04% (SOFR + 5.00%), maturity 1/21/28	12/13/2021		1,496,250		1,474,797			1,488,769
Mission Veterinary Partners, Senior Secured Initial Term Loan (First Lien), 6.29% (LIBOR + 4.00%), maturity 4/27/28	12/15/2021		1,488,750		1,475,284			1,488,750
Therapy Brands, Senior Secured Initial Term Loan (First Lien), 6.29% (LIBOR + 4.00%), maturity 5/18/28	5/12/2021		1,488,750		1,482,270			1,481,306
Quantum Health, Senior Secured Amendment No. 1 Refinancing Term Loan (First Lien), 6.79% (LIBOR + 4.50%), maturity 12/22/27	12/18/2020		1,485,000		1,465,155			1,477,575
Symplr, Senior Secured Initial Term Loan (First Lien), 5.25% (LIBOR + 4.50%), maturity 12/22/27 (i)	11/23/2020		1,481,250		1,461,540			1,427,108
Tecomet, Senior Secured 2017 Term Loan (First Lien), 5.79% (LIBOR + 3.50%), maturity 5/1/24	1/10/2019		1,149,819		1,147,874			1,112,450
Solis Mammography, Senior Secured Initial Term Loan (First Lien), 7.04% (LIBOR + 4.75%), maturity 4/17/28	4/1/2021		1,075,833		1,067,373			1,065,075
Ivy Rehab, Senior Secured Initial Term Loan (First Lien), 5.79% (SOFR + 4.75%), maturity 2/17/29	3/11/2022		1,019,608		997,784			1,011,961
Micro Merchant Systems, Unitranche, 6.50% (LIBOR + 5.75%), maturity 12/14/27 (j)	3/2/2022		997,500		986,881			995,006
nThrive, Senior Secured Initial Term Loan (First Lien), 6.29% (LIBOR + 4.00%), maturity 12/18/28	11/19/2021		997,500		993,000			992,513
Wedgewood Pharmacy, Senior Secured Initial Term Loan, 6.54% (LIBOR + 4.25%), maturity 3/31/28	2/24/2021		992,500		983,770			992,500
Solis Mammography, Senior Secured Initial Term Loan (Second Lien), 10.29% (LIBOR + 8.00%), maturity 4/16/29	4/1/2021		1,000,000		987,040			990,000
Allied Benefit Systems, Senior Secured Initial Term B Loan, 6.79% (LIBOR + 4.50%), maturity 11/18/26	10/21/2020		985,000		973,827			982,538
CareCentrix, Senior Secured Initial Term Loan, 6.79% (LIBOR + 4.50%), maturity 4/3/25	4/2/2018		961,025		958,724			953,817
Alcami, Senior Secured Initial Term Loan (First Lien), 6.54% (LIBOR + 4.25%), maturity 7/14/25	7/12/2018		962,500		960,038			931,219
Forefront, Senior Secured Closing Date Term Loan, 5.29% (SOFR + 4.25%), maturity 4/2/29	3/23/2022		867,402		850,054			860,896
Epic Staffing Group, Senior Secured Initial Term Loan, 6.50% (SOFR + 6.00%), maturity 6/28/29 (i)	6/27/2022		825,581		776,047			776,047
UDG, Senior Secured Initial Dollar Term Loan (First Lien), 4.75% (LIBOR + 4.25%), maturity 8/19/28 (l)	8/6/2021		631,875		626,273			627,136
ImageFirst, Senior Secured Initial Term Loan, 6.79% (LIBOR + 4.50%), maturity 4/27/28	4/26/2021		607,841		605,350			603,282
AccentCare, Senior Secured 2021 Term Loan (First Lien), 6.29% (LIBOR + 4.00%), maturity 6/22/26	6/15/2021		495,000		495,000			490,050
MyEyeDr, Senior Secured Initial Term Loan (First Lien), 4.25% (LIBOR + 4.25%), maturity 8/31/26 (i)	8/2/2019		524,006		520,663			479,228
RMP & MedA/Rx, Senior Secured Term Loan, 6.79% (LIBOR + 4.50%), maturity 2/6/25	3/22/2021		478,125		473,841			476,930
Western Dental, Senior Secured Incremental Term Loan, 6.00% (LIBOR + 5.25%), maturity 8/18/28 (i)	5/27/2022		500,000		490,000			472,030
MedRisk, Senior Secured Initial Term Loan (First Lien), 4.50% (LIBOR + 3.75%), maturity 5/10/28 (i)	4/1/2021		496,250		491,885			471,535
Press Ganey, Senior Secured 2020 Incremental Term Loan (First Lien), 4.75% (LIBOR + 4.00%), maturity 7/24/26 (i)	10/1/2020		493,763		489,965			466,545
RMP & MedA/Rx, Senior Secured Term Loan (First Lien), 6.54% (LIBOR + 4.25%), maturity 2/6/25	2/27/2017		408,523		408,438			407,502
Paradigm Oral Health, Senior Secured Delayed Draw Term Loan, 5.79% (SOFR + 4.75%), maturity 7/9/26	4/11/2022		303,683		293,957			301,406
CPS, Senior Secured Revolving Credit Loan, 5.75% (LIBOR + 5.75%), maturity 5/27/28 (j)	5/18/2022		-		(714	)		-
Paradigm Oral Health, Senior Secured Revolving Loan, 5.79% (SOFR + 4.75%), maturity 7/9/26	4/11/2022		-		(1,111	)		-
Ivy Rehab, Senior Secured Revolving Credit (First Lien), 5.79% (SOFR + 4.75%), maturity 3/15/28	3/11/2022		-		(3,367	)		-
Advarra, Senior Secured Initial Revolving Loan (First Lien), 6.54% (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) (k)	12/7/2021		4,488,750		4,448,250			4,297,326
InnovateMR, Unitranche, 6.75% (LIBOR + 5.75%), maturity 1/20/28 (i) (j)	12/16/2021		4,226,065		4,152,776			4,163,690
CoAdvantage, Senior Secured Initial Term Loan (First Lien), 6.00% (LIBOR + 5.00%), maturity 9/23/25 (k)	9/26/2019		3,890,000		3,866,973			3,890,000
RevSpring, Senior Secured Initial Term Loan (First Lien), 4.25% (LIBOR + 4.25%), maturity 10/11/25 (k)	10/5/2018		3,860,000		3,857,320			3,860,000
Eliassen, Unitranche, 6.79% (SOFR + 5.75%), maturity 4/14/28	3/31/2022		3,259,259		3,206,319			3,242,963
Veritext, Senior Secured Initial Term Loan (First Lien), 3.25% (LIBOR + 3.25%), maturity 8/1/25 (i)	8/14/2018		3,095,178		3,082,402			3,095,178
Discovery Education, Unitranche, 6.50% (SOFR + 5.75%), maturity 3/10/29 (k)	3/25/2022		3,000,000		2,949,959			2,977,500
Fleetwash, Senior Secured Incremental Term Loan, 7.04% (LIBOR + 4.75%), maturity 10/1/24	9/25/2018		2,888,175		2,874,731			2,859,293
CoolSys, Senior Secured Closing Date Initial Term Loan, 7.04% (LIBOR + 4.75%), maturity 8/11/28	8/4/2021		2,577,326		2,549,779			2,548,331
Service Logic, Senior Secured Closing Date Initial Term Loan (First Lien), 6.29% (LIBOR + 4.00%), maturity 10/29/27	10/23/2020		2,417,703		2,397,661			2,399,570
The Facilities Group, Unitranche, 8.04% (LIBOR + 5.75%), maturity 11/30/27	12/10/2021		2,351,163		2,329,795			2,339,407
Duff & Phelps, Senior Secured Initial Dollar Term Loan (First Lien), 4.75% (LIBOR + 3.75%), maturity 4/9/27 (i)	3/6/2020		2,450,000		2,432,834			2,338,613
Vistage, Senior Secured Term B Loan (First Lien), 5.00% (LIBOR + 4.00%), maturity 2/10/25 (i)	2/6/2018		2,310,869		2,308,473			2,310,869
TRC Companies, Senior Secured Initial Term Loan (Second Lien), 9.04% (LIBOR + 6.75%), maturity 12/7/29	11/19/2021		2,000,000		1,982,000			1,985,000
Veregy, Senior Secured Initial Term Loan, 8.29% (LIBOR + 6.00%), maturity 11/3/27	11/2/2020		1,970,000		1,923,711			1,945,375
Sterling Backcheck, Senior Secured Initial Term Loan (First Lien), 5.79% (LIBOR + 3.50%), maturity 6/19/24	6/30/2017		1,927,352		1,927,352			1,927,352
Mediaocean, Senior Secured Initial Term Loan, 4.00% (LIBOR + 3.50%), maturity 12/15/28 (i)	12/9/2021		1,995,000		1,977,000			1,905,887
ECi Software, Senior Secured Initial Term Loan (First Lien), 4.50% (LIBOR + 3.75%), maturity 11/9/27 (i)	9/17/2020		1,970,000		1,963,289			1,883,267
Liberty Group, Unitranche, 5.75%, maturity 6/9/28 (i) (j)	6/6/2022		1,818,182		1,778,996			1,781,818
Addison Group, Senior Secured Initial Term Loan, 5.29% (SOFR + 4.25%), maturity 12/29/28	1/19/2022		1,496,250		1,492,875			1,496,250

The accompanying notes are an integral part of these financial statements.

6

Audax Credit BDC Inc.

Schedule of Investments (Continued)

As of June 30, 2022

(Expressed in U.S. Dollars)

(unaudited)

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)
Insight Global, Unitranche, 6.75% (LIBOR + 6.00%), maturity 9/22/28 (k)	9/22/2021	$	1,488,750	$	1,459,389		$	1,488,750
OSG Billing Services, Senior Secured Term B Loan (First Lien), 6.79% (LIBOR + 4.50%), maturity 3/27/24	3/26/2018		1,436,891		1,434,520			1,350,678
First Advantage, Senior Secured Term B-1 Loan (First Lien), 2.75% (LIBOR + 2.75%), maturity 1/31/27 (i)	1/23/2020		1,100,312		1,090,266			1,065,356
Veritext, Senior Secured Initial Term Loan (Second Lien), 6.75% (LIBOR + 6.75%), maturity 7/31/26 (i)	8/14/2018		1,000,000		997,010			1,000,000
trustaff Management, Senior Secured Initial Term Loan (First Lien), 6.04% (LIBOR + 3.75%), maturity 3/6/28	12/9/2021		992,462		990,218			992,462
TRC Companies, Senior Secured Initial Term Loan (First Lien), 6.04% (LIBOR + 3.75%), maturity 12/8/28	11/19/2021		997,500		993,000			990,019
Divisions Maintenance Group, Senior Secured Term B Loan, 7.04% (LIBOR + 4.75%), maturity 5/27/28	5/21/2021		992,500		984,040			985,056
WCG, Senior Secured Initial Term Loan (First Lien), 6.29% (LIBOR + 4.00%), maturity 1/8/27	12/13/2019		980,000		973,062			972,650
Restaurant Technologies, Senior Secured Initial Term Loan, 4.75% (SOFR + 4.25%), maturity 4/2/29 (i)	3/17/2022		997,500		973,294			966,578
eResearch (ERT), Senior Secured Initial Term Loan (First Lien), 5.50% (LIBOR + 4.50%), maturity 2/4/27 (i)	12/1/2020		984,931		984,931			930,034
Diversified, Senior Secured Initial Term Loan, 7.04% (LIBOR + 4.75%), maturity 12/23/23	4/19/2019		899,347		896,300			892,602
Secretariat International, Senior Secured Initial Term Loan (First Lien), 7.04% (LIBOR + 4.75%), maturity 12/29/28	12/16/2021		845,750		841,254			841,521
System One, Senior Secured Initial Term Loan, 6.29% (LIBOR + 4.00%), maturity 3/2/28	1/28/2021		495,000		493,020			490,050
Therma Holdings, Senior Secured Initial Term Loan (2021), 4.75% (LIBOR + 4.00%), maturity 12/16/27 (i)	12/11/2020		502,841		501,743			480,670
Liberty Group, Senior Secured Revolving Loan, 2.29%, maturity 6/9/28 (i) (j)	6/6/2022		45,455		40,909			44,545
Insight Global, Senior Secured Revolving Loan, 8.29% (LIBOR + 6.00%), maturity 9/22/27	9/23/2021		36,899		36,899			36,899
Discovery Education, Senior Secured Revolving Facility, 6.79% (SOFR + 5.75%), maturity 4/7/28	3/25/2022		-		(4,038	)		-
High Tech Industries
Qlik, Senior Secured 2021 Refinancing Term Loan, 4.00% (LIBOR + 4.00%), maturity 4/26/24 (i) (k)	3/29/2019		3,880,900		3,867,923			3,771,901
Golden Source, Unitranche, 6.50% (SOFR + 5.50%), maturity 5/31/28 (i) (j)	3/25/2022		3,474,178		3,397,547			3,404,695
Netsmart, Senior Secured Initial Term Loan (First Lien), 4.75% (LIBOR + 4.00%), maturity 10/1/27 (i)	9/29/2020		3,456,250		3,444,468			3,346,153
Jaggaer, Senior Secured Initial Term Loan (First Lien), 4.00% (LIBOR + 4.00%), maturity 8/14/26 (i)	8/9/2019		3,075,289		3,071,870			2,964,071
Infogroup, Senior Secured Term Loan (First Lien), 7.29% (LIBOR + 5.00%), maturity 4/3/23	3/28/2017		2,844,875		2,835,413			2,837,762
Ivanti Software, Senior Secured 2021 Specified Refinancing Term Loan (First Lien), 5.25% (LIBOR + 4.25%), maturity 12/1/27 (i)	11/20/2020		2,977,538		2,944,019			2,628,448
Planview, Senior Secured Closing Date Term Loan (First Lien), 6.29% (LIBOR + 4.00%), maturity 12/17/27	12/11/2020		2,618,995		2,596,580			2,612,448
Idera, Senior Secured Term B-1 Loan (First Lien), 4.50% (LIBOR + 3.75%), maturity 3/2/28 (i)	6/27/2017		2,586,222		2,585,543			2,433,358
PracticeTek, Unitranche, 5.50% (LIBOR + 5.50%), maturity 11/23/27 (j)	11/22/2021		2,397,424		2,337,009			2,397,424
Precisely, Senior Secured Third Amendment Term Loan (First Lien), 4.75% (LIBOR + 4.00%), maturity 4/24/28 (i)	3/19/2021		2,481,250		2,470,540			2,299,717
Flexera Software, Senior Secured Term B-1 Loan (First Lien), 4.50% (LIBOR + 3.75%), maturity 3/3/28 (i)	2/16/2020		2,370,234		2,370,234			2,272,908
Barracuda, Senior Secured Second Lien Term Loan, 8.04% (SOFR + 7.00%), maturity 5/17/30	5/17/2022		2,000,000		1,940,000			1,985,000
QuickBase, Senior Secured Term Loan (First Lien), 6.29% (LIBOR + 4.00%), maturity 4/2/26	3/29/2019		1,940,000		1,934,451			1,925,450
HelpSystems, Senior Secured Term Loan, 4.75% (LIBOR + 4.00%), maturity 11/19/26 (i)	12/19/2019		1,979,854		1,972,866			1,880,871
Intermedia , Senior Secured New Term Loan (First Lien), 8.29% (LIBOR + 6.00%), maturity 7/21/25	7/13/2018		1,930,000		1,922,083			1,876,925
Sophos, Senior Secured Dollar Tranche Term Loan (First Lien), 3.50% (LIBOR + 3.50%), maturity 3/5/27 (i) (m)	1/16/2020		1,960,018		1,876,844			1,875,154
MediaRadar, Unitranche, 6.75% (SOFR + 5.75%), maturity 7/22/28 (i) (j)	5/23/2022		1,837,037		1,800,296			1,800,296
OEConnection, Senior Secured Initial Term Loan, 6.29% (LIBOR + 4.00%), maturity 9/25/26	9/24/2019		1,600,419		1,595,835			1,592,417
Bomgar, Senior Secured Initial Term Loan (First Lien), 4.00% (LIBOR + 4.00%), maturity 4/18/25 (i)	5/25/2018		1,619,198		1,624,894			1,565,219
Digital Room, Senior Secured Closing Date Term Loan (First Lien), 7.54% (LIBOR + 5.25%), maturity 12/21/28	12/16/2021		1,496,250		1,482,750			1,481,288
Navex Global, Senior Secured Initial Term Loan (First Lien), 5.54% (LIBOR + 3.25%), maturity 9/5/25	8/15/2018		1,443,750		1,435,245			1,443,750
SmartBear, Senior Secured Initial Term Loan (First Lien), 6.54% (LIBOR + 4.25%), maturity 3/3/28	11/20/2020		990,000		981,540			990,000
Barracuda, Senior Secured 2020 Term Loan (First Lien), 4.50% (LIBOR + 3.75%), maturity 2/12/25 (i)	3/2/2018		982,500		982,500			982,500
Unison, Unitranche, 8.00% (LIBOR + 7.00%), maturity 6/25/26 (j)	6/25/2020		980,000		962,218			980,000
ORBCOMM, Senior Secured Closing Date Term Loan (First Lien), 6.54% (LIBOR + 4.25%), maturity 9/1/28	6/17/2021		992,500		988,000			960,244
Imperva, Senior Secured Term Loan, 6.29% (LIBOR + 4.00%), maturity 1/12/26	9/23/2020		981,038		974,351			949,154
Infoblox, Senior Secured Initial Term Loan (First Lien), 4.50% (LIBOR + 3.75%), maturity 12/1/27 (i)	10/7/2020		990,000		986,276			920,931
Barracuda, Senior Secured First Lien Term Loan, 5.54% (SOFR + 4.50%), maturity 5/17/29	5/17/2022		500,000		485,000			496,250
Cloudera, Senior Secured Initial Term Loan (First Lien), 6.04% (LIBOR + 3.75%), maturity 10/8/28	8/10/2021		498,750		494,277			495,009
DigiCert, Senior Secured Initial Term Loan (First Lien), 4.00% (LIBOR + 4.00%), maturity 10/16/26 (i)	3/13/2020		488,750		469,009			469,478
Golden Source, Senior Secured Revolving Credit, 6.50% (SOFR + 5.50%), maturity 5/31/28 (i) (j)	3/25/2022		-		(9,390	)		-
PracticeTek, Senior Secured Revolving Loan, 5.50% (LIBOR + 5.50%), maturity 11/23/27 (j)	11/22/2021		-		(7,156	)		-
Containers, Packaging & Glass
InMark, Unitranche, 7.00% (LIBOR + 6.00%), maturity 12/23/26 (j) (k)	12/10/2021		6,455,559		6,334,519			6,455,559
Transcendia, Senior Secured 2017 Refinancing Term Loan (First Lien), 4.50% (LIBOR + 3.50%), maturity 5/30/24 (k)	5/11/2017		3,335,581		3,328,944			3,243,853
Brook & Whittle, Senior Secured Initial Term Loan (First Lien), 6.29% (LIBOR + 4.00%), maturity 12/14/28	12/9/2021		3,147,065		3,123,377			3,131,330
Anchor Packaging, Senior Secured Initial Term Loan (First Lien), 6.29% (LIBOR + 4.00%), maturity 7/18/26	7/17/2019		2,503,650		2,494,564			2,491,131
Packaging Coordinators, Senior Secured Term B Loan (First Lien), 4.50% (LIBOR + 3.75%), maturity 11/30/27 (i)	9/25/2020		2,456,375		2,449,139			2,355,247
Paragon Films, Senior Secured Closing Date Term Loan (First Lien), 7.29% (LIBOR + 5.00%), maturity 12/16/28	12/15/2021		1,995,000		1,975,663			1,985,025
Intertape Polymer, Senior Secured Initial Term Loan (First Lien), 5.00% (SOFR + 4.50%), maturity 7/31/29 (i)	6/15/2022		2,000,000		1,920,000			1,920,000
Resource Label Group, Senior Secured Closing Date Initial Term Loan (First Lien), 6.54% (LIBOR + 4.25%), maturity 7/7/28	7/2/2021		1,870,348		1,862,159			1,865,672
TricorBraun, Senior Secured Closing Date Initial Term Loan (First Lien), 3.75% (LIBOR + 3.25%), maturity 3/3/28 (i)	1/29/2021		1,819,572		1,811,907			1,719,152
Technimark, Senior Secured Initial Term Loan (First Lien), 6.04% (LIBOR + 3.75%), maturity 7/7/28	6/30/2021		1,485,000		1,478,520			1,466,438
Potters Industries, Senior Secured Initial Term Loan, 6.29% (LIBOR + 4.00%), maturity 12/14/27	11/19/2020		1,481,250		1,470,077			1,464,586
Tekni-Plex, Senior Secured Tranche B-3 Initial Term Loan, 4.50% (LIBOR + 4.00%), maturity 9/15/28 (i)	7/29/2021		1,080,991		1,078,715			1,025,307
Lacerta, Senior Secured Term Loan, 7.79% (LIBOR + 5.50%), maturity 12/30/26	2/8/2021		985,000		976,135			985,000
Pregis Corporation, Senior Secured Initial Term Loan (First Lien), 6.29% (LIBOR + 4.00%), maturity 7/31/26	7/25/2019		975,000		973,487			967,688
Novolex, Senior Secured Term B Loan (First Lien), 4.75% (SOFR + 4.25%), maturity 4/13/29 (i)	3/30/2022		1,000,000		975,820			950,757
Applied Adhesives, Senior Secured Term A Loan, 7.29% (LIBOR + 5.00%), maturity 3/12/27	3/12/2021		595,899		590,976			592,919
Five Star Holding Corp, Senior Secured Initial Term Loan (First Lien), 5.29% (SOFR + 4.25%), maturity 5/5/29	4/27/2022		500,000		492,627			496,250
Golden West Packaging, Senior Secured Initial Term Loan, 7.54% (LIBOR + 5.25%), maturity 12/1/27	11/29/2021		496,875		492,375			495,633
Pregis Corporation, Senior Secured Third Amendment Refinancing Term Loan (First Lien), 6.29% (LIBOR + 4.00%), maturity 7/31/26	12/9/2020		496,250		494,388			492,528
Applied Adhesives, Senior Secured Revolving Loan, 7.29% (LIBOR + 5.00%), maturity 3/12/27	3/12/2021		23,111		22,471			22,996

The accompanying notes are an integral part of these financial statements.

7

Audax Credit BDC Inc.

Schedule of Investments (Continued)

As of June 30, 2022

(Expressed in U.S. Dollars)

(unaudited)

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 (k)	7/22/2021	$	3,980,000	$	3,962,000		$	3,970,050
Ascensus, Senior Secured Initial Term Loan (First Lien), 5.79% (LIBOR + 3.50%), maturity 8/2/28	11/17/2021		2,992,500		2,978,996			2,970,056
Cherry Bekaert, Unitranche, 5.50%, maturity 6/30/28 (i) (j)	6/13/2022		3,020,713		2,960,299			2,960,299
AmeriLife, Senior Secured Initial Term Loan (First Lien), 4.00% (LIBOR + 4.00%), maturity 3/18/27 (i)	2/6/2020		2,450,358		2,438,426			2,450,358
EPIC Insurance, Unitranche, 7.54% (LIBOR + 5.25%), maturity 9/29/28	8/27/2021		2,182,562		2,149,572			2,171,649
American Beacon Advisors, Senior Secured Tranche D Term Loan (Second Lien), 10.29% (LIBOR + 8.00%), maturity 4/30/25	10/31/2017		2,117,133		2,121,670			2,111,840
BETA, Senior Secured Term Facility, 5.25% (SOFR + 5.25%), maturity 7/1/29 (i) (j)	6/24/2022		2,000,000		1,959,868			1,960,000
Kestra Financial, Senior Secured Initial Term Loan, 6.54% (LIBOR + 4.25%), maturity 6/3/26	4/29/2019		1,945,000		1,933,096			1,935,275
Integro, Senior Secured Initial Term Loan (First Lien), 8.04% (LIBOR + 5.75%), maturity 10/31/22	10/9/2015		1,930,484		1,932,669			1,776,045
Orion, Senior Secured 2021 Refinancing Term Loan (First Lien), 4.50% (LIBOR + 3.75%), maturity 9/24/27 (i)	8/4/2020		1,477,547		1,464,047			1,409,675
SIAA, Unitranche, 8.54% (LIBOR + 6.25%), maturity 4/28/28	4/21/2021		1,166,639		1,148,666			1,166,639
Community Brands, Senior Secured Initial Term Loan, 6.79% (SOFR + 5.75%), maturity 2/24/28	2/23/2022		997,500		976,459			990,019
LERETA, Senior Secured Initial Term Loan, 7.54% (LIBOR + 5.25%), maturity 7/30/28	7/27/2021		992,500		983,500			985,056
Advisor Group, Senior Secured Term B-1 Loan, 4.50% (LIBOR + 4.50%), maturity 7/31/26 (i)	1/31/2020		1,024,181		1,020,371			984,554
Sedgwick Claims, Senior Secured Initial Term Loan, 5.54% (LIBOR + 3.25%), maturity 12/31/25	2/12/2020		487,374		486,945			486,155
EdgeCo, Senior Secured Third Amendment Term Loan, 5.79% (SOFR + 4.75%), maturity 6/1/26	3/29/2022		299,250		276,968			297,754
Integro, Senior Secured Tenth Amendment Initial Loan, 13.04% (SOFR + 12.00%), maturity 5/9/23	5/5/2022		161,041		161,041			148,158
EPIC Insurance, Senior Secured Revolving Loan, 7.54% (LIBOR + 5.25%), maturity 9/30/27	8/27/2021		-		(269	)		-
BETA, Senior Secured Revolving Credit Facility, 5.25% (SOFR + 5.25%), maturity 7/1/27 (i) (j)	6/24/2022		-		(6,216	)		-
Aerospace & Defense
CPI International, Senior Secured Second Amendment Incremental Term Loan (First Lien), 5.75% (LIBOR + 4.75%), maturity 7/26/24 (i)	10/1/2019		5,195,798		5,159,394			5,195,798
HDT Global, Senior Secured Initial Term Loan, 8.04% (LIBOR + 5.75%), maturity 7/8/27	6/30/2021		3,325,000		3,230,500			3,216,938
StandardAero, Senior Secured 2020 Term B-1 Loan, 3.50% (LIBOR + 3.50%), maturity 4/6/26 (i)	1/24/2019		3,254,423		3,248,305			3,065,611
CPI International, Senior Secured Term Loan, 6.25% (SOFR + 5.50%), maturity 6/30/29 (i) (j)	5/18/2022		3,000,000		2,940,000			2,940,000
Consolidated Precision Products, Senior Secured Initial Term Loan (Second Lien), 10.04% (LIBOR + 7.75%), maturity 4/30/26	5/10/2018		2,000,000		2,006,306			1,935,000
Amentum, Senior Secured Tranche 3 Term Loan (First Lien), 4.50% (SOFR + 4.00%), maturity 2/15/29 (i)	2/10/2022		2,000,000		1,990,678			1,924,030
Whitcraft, Unitranche, 8.29% (LIBOR + 6.00%), maturity 4/3/23	3/6/2020		1,952,371		1,945,505			1,898,681
StandardAero, Senior Secured 2020 Term B-2 Loan, 3.50% (LIBOR + 3.50%), maturity 4/6/26 (i)	1/24/2019		1,749,690		1,746,401			1,648,178
Tronair, Senior Secured Initial Term Loan (First Lien), 6.75% (LIBOR + 5.75%) cash, 0.50% PIK, maturity 9/8/23	9/30/2016		1,358,487		1,356,012			1,304,148
Amentum, Senior Secured Tranche 1 Term Loan (First Lien), 3.50% (LIBOR + 3.50%), maturity 1/29/27 (i)	1/24/2020		980,000		956,279			942,834
Peraton, Senior Secured Term B Loan (First Lien), 4.50% (LIBOR + 3.75%), maturity 2/1/28 (i)	2/23/2021		969,612		965,652			928,444
API Technologies, Senior Secured Initial Term Loan (First Lien), 6.54% (LIBOR + 4.25%), maturity 5/9/26	1/15/2020		974,874		953,855			901,759
BlueHalo, Unitranche, 8.29% (LIBOR + 6.00%), maturity 10/31/25	11/17/2021		496,521		489,771			490,935
Novaria Group, Senior Secured Initial Term Loan, 7.79% (LIBOR + 5.50%), maturity 1/27/27	1/24/2020		481,818		478,356			469,773
Consolidated Precision Products, Senior Secured Initial Term Loan (First Lien), 6.04% (LIBOR + 3.75%), maturity 4/30/25	7/18/2019		485,491		483,911			466,072
BlueHalo, Senior Secured Revolving Loan, 8.29% (LIBOR + 6.00%), maturity 10/31/25	11/17/2021		44,770		43,429			44,266
Capital Equipment
FloWorks, Senior Secured Initial Term Loan (First Lien), 6.04% (SOFR + 5.00%), maturity 12/27/28	12/27/2021		4,000,000		3,865,000			4,000,000
Tank Holding, Unitranche, 7.04% (SOFR + 6.00%), maturity 3/31/28	3/25/2022		4,000,000		3,923,934			3,970,000
Plaskolite, Senior Secured 2021-1 Refinancing Term Loan (First Lien), 4.75% (LIBOR + 4.00%), maturity 12/15/25 (i)	12/12/2018		3,861,125		3,821,204			3,597,046
Excelitas, Senior Secured Initial Euro Term Loan, 5.75% (Other + 5.75%), maturity 7/6/29 (i)	6/15/2022		2,969,565		2,910,174			2,910,174
MW Industries, Senior Secured 2018 New Term Loan (First Lien), 6.04% (LIBOR + 3.75%), maturity 9/30/24	4/20/2018		2,037,185		2,037,185			2,032,092
Flow Control Group, Senior Secured Initial Term Loan (First Lien), 4.25% (LIBOR + 3.75%), maturity 3/31/28 (i)	3/17/2021		1,674,662		1,672,288			1,596,007
Excelitas, Senior Secured Initial Term Loan (Second Lien), 8.50% (LIBOR + 7.50%), maturity 12/1/25 (i)	2/19/2020		1,500,000		1,484,551			1,500,000
Radwell, Unitranche, 6.79% (SOFR + 5.75%), maturity 4/1/29	3/11/2022		1,500,000		1,475,589			1,488,750
Edward Don, Senior Secured Initial Term Loan, 6.54% (LIBOR + 4.25%), maturity 7/2/25	6/26/2018		1,370,943		1,368,270			1,333,242
Therm-O-Disc, Senior Secured Initial Term Loan (First Lien), 7.04% (SOFR + 6.00%), maturity 5/31/29	5/26/2022		1,000,000		920,000			992,500
TriMark, Senior Secured Second Amendment Tranche B Loan (Super Senior priority), 5.79% (LIBOR + 3.50%), maturity 8/28/24	1/31/2022		968,518		968,518			794,185
Culligan, Senior Secured 2022 Refinancing Term B Loan, 4.50% (LIBOR + 4.00%), maturity 7/31/28 (i)	6/17/2021		562,500		559,969			524,105
Infinite Electronics, Senior Secured Initial Term Loan (First Lien), 5.54% (LIBOR + 3.25%), maturity 3/2/28	2/24/2021		495,000		494,010			495,000
Excelitas, Senior Secured Initial USD Term Loan (First Lien), 4.50% (LIBOR + 3.50%), maturity 12/2/24 (i)	10/24/2018		481,108		483,254			481,108
SPX Flow, Senior Secured Term Loan, 5.00% (SOFR + 4.50%), maturity 4/5/29 (i)	3/18/2022		500,000		477,500			471,703
Duravant, Senior Secured Incremental Amendment No. 5 Term Loan (First Lien), 4.50% (LIBOR + 3.75%), maturity 5/19/28 (i)	3/5/2020		489,962		489,962			466,244
Tank Holding, Senior Secured Revolving Credit Loan, 7.04% (SOFR + 6.00%), maturity 3/31/28	3/25/2022		61,538		58,585			61,077
Radwell, Senior Secured Revolving Loan, 6.79% (SOFR + 5.75%), maturity 4/1/28	3/11/2022		-		(1,200	)		-
Chemicals, Plastics & Rubber
DuBois Chemicals, Senior Secured Term Loan (Second Lien) - 2019, 10.79% (LIBOR + 8.50%), maturity 9/30/27	10/8/2019		3,000,000		2,977,818			2,977,500
Vertellus, Senior Secured Initial Term Loan, 8.29% (LIBOR + 6.00%), maturity 12/22/27	12/18/2020		2,977,500		2,911,500			2,962,613
Spectrum Plastics, Senior Secured Closing Date Term Loan (First Lien), 5.54% (LIBOR + 3.25%), maturity 1/31/25	1/26/2018		2,613,975		2,619,536			2,574,765
Unifrax, Senior Secured USD Term Loan (First Lien), 3.75% (LIBOR + 3.75%), maturity 12/12/25 (i)	11/5/2018		2,413,709		2,396,941			2,317,161
Boyd Corp, Senior Secured Initial Loan (Second Lien), 9.04% (LIBOR + 6.75%), maturity 9/6/26	8/16/2018		2,000,000		2,001,506			1,995,000
Meridian Adhesives Group, Senior Secured Initial Term Loan, 6.29% (LIBOR + 4.00%), maturity 7/24/28	7/16/2021		1,990,000		1,972,270			1,980,050
USALCO, Unitranche, 8.29% (LIBOR + 6.00%), maturity 10/19/27	10/26/2021		1,990,000		1,972,000			1,975,075
DuBois Chemicals, Senior Secured Term Loan B (First Lien), 6.79% (LIBOR + 4.50%), maturity 9/30/26	10/8/2019		1,768,296		1,739,857			1,755,034
Vantage Specialty Chemicals, Senior Secured Closing Date Term Loan (First Lien), 5.79% (LIBOR + 3.50%), maturity 10/28/24	11/30/2018		962,217		952,820			957,406
Ascensus Specialties, Senior Secured Initial Term Loan, 6.54% (LIBOR + 4.25%), maturity 6/30/28	12/3/2021		496,233		487,233			492,512
Polytek, Senior Secured Term Loan, 7.29% (LIBOR + 5.00%), maturity 9/20/24	12/23/2020		492,600		488,370			476,590
Boyd Corp, Senior Secured Initial Term Loan (First Lien), 3.50% (LIBOR + 3.50%), maturity 9/6/25 (i)	11/7/2018		489,822		465,745			459,896
USALCO, Senior Secured Revolving Loan, 8.29% (LIBOR + 6.00%), maturity 10/19/26	10/26/2021		153,226		150,323			152,077
Vertellus, Senior Secured Revolving Credit Loan, 8.29% (LIBOR + 6.00%), maturity 12/22/25	12/18/2020		72,936		61,995			72,571

The accompanying notes are an integral part of these financial statements.

8

Audax Credit BDC Inc.

Schedule of Investments (Continued)

As of June 30, 2022

(Expressed in U.S. Dollars)

(unaudited)

Portfolio Investments (a) (b) (c) (d) (e) (f)	Acquisition Date	Par		Cost			Value
BANK LOANS: NON-CONTROL/NON-AFFILIATE INVESTMENTS(h) (Continued):
Services: Consumer
Ned Stevens, Unitranche, 7.00% (SOFR + 6.00%), maturity 6/30/29 (i) (j)	6/22/2022	$	3,558,460	$	3,496,006		$	3,505,084
Weld North, Senior Secured 2021 Term Loan, 4.75% (LIBOR + 3.75%), maturity 12/21/27 (i)	12/21/2020		2,408,195		2,408,195			2,323,672
A Place For Mom, Senior Secured Term Loan, 6.79% (LIBOR + 4.50%), maturity 2/10/26	7/28/2017		2,221,608		2,221,436			2,204,945
Smart Start, Senior Secured Term B Loan (Second Lien), 10.04% (LIBOR + 7.75%), maturity 12/16/29	12/10/2021		2,000,000		1,964,000			1,985,000
Smart Start, Senior Secured Term B Loan (First Lien), 6.79% (LIBOR + 4.50%), maturity 12/16/28	12/10/2021		1,990,000		1,972,000			1,975,075
FullBloom, Senior Secured Initial Term Loan (First Lien), 5.29% (SOFR + 4.25%), maturity 12/15/28	12/10/2021		1,500,000		1,486,500			1,488,750
Mister Car Wash, Senior Secured Initial Term Loan (First Lien), 3.00% (LIBOR + 3.00%), maturity 5/14/26 (i)	5/8/2019		1,528,610		1,526,527			1,467,623
Teaching Strategies, Senior Secured Initial Term Loan (First Lien), 6.54% (LIBOR + 4.25%), maturity 8/31/28	8/19/2021		995,000		986,054			995,000
Spring Education, Senior Secured Initial Term Loan (First Lien), 4.25% (LIBOR + 4.25%), maturity 7/30/25 (i)	7/26/2018		962,500		961,255			908,272
Aegis Sciences, Senior Secured Initial Term Loan (2018) (First Lien), 7.79% (LIBOR + 5.50%), maturity 5/9/25	5/4/2018		610,388		605,691			610,388
Ned Stevens, Senior Secured Revolving Credit, 7.00% (SOFR + 6.00%), maturity 6/30/28 (i) (j)	6/22/2022		34,495		30,410			33,978
Ned Stevens, Senior Secured Revolving Loan, 6.25% (LIBOR + 5.25%), maturity 9/30/25 (j)	9/30/2019		-		(2,614	)		-
Transportation: Cargo
Evans Network, Senior Secured Initial Term Loan (First Lien), 6.54% (LIBOR + 4.25%), maturity 8/19/28	8/6/2021		3,645,918		3,609,918			3,627,689
Odyssey Logistics & Technology , Senior Secured New Term Loan (First Lien), 5.00% (LIBOR + 4.00%), maturity 10/12/24 (i)	11/20/2018		3,553,288		3,550,804			3,429,328
Capstone Logistics, Senior Secured Closing Date Term Loan (First Lien), 7.04% (LIBOR + 4.75%), maturity 11/12/27	11/12/2020		2,106,328		2,089,200			2,106,328
AIT Worldwide Logistics, Senior Secured Initial Term Loan (First Lien), 5.50% (LIBOR + 4.75%), maturity 4/6/28 (i)	12/9/2021		1,985,000		1,980,511			1,845,857
St. George Logistics, Senior Secured Initial Term Loan, 7.04% (SOFR + 6.00%), maturity 3/24/28	4/28/2022		1,496,250		1,474,453			1,481,288
Worldwide Express, Senior Secured Initial Term Loan (First Lien), 5.00% (LIBOR + 4.25%), maturity 7/26/28 (i)	7/23/2021		1,492,500		1,482,375			1,375,550
Omni Logistics, Senior Secured Initial Term Loan (First Lien), 7.29% (LIBOR + 5.00%), maturity 12/30/26	11/24/2021		1,154,031		1,143,234			1,154,031
FLS Transportation, Senior Secured Term B Loan, 7.54% (LIBOR + 5.25%), maturity 12/18/28	4/14/2022		1,000,000		990,328			1,000,000
Magnate, Senior Secured Initial Term Loan (First Lien), 7.79% (LIBOR + 5.50%), maturity 12/29/28	3/11/2022		923,929		906,270			923,929
FLS Transportation, Senior Secured Revolving Loan, 7.54% (LIBOR + 5.25%), maturity 12/17/27	4/14/2022		-		(889	)		-
Omni Logistics, Senior Secured Revolving Credit Loan (First Lien), 7.29% (LIBOR + 5.00%), maturity 12/30/25	11/24/2021		-		(1,119	)		-
Beverage, Food & Tobacco
Bettcher Industries, Senior Secured Initial Term Loan (Second Lien), 8.29% (SOFR + 7.25%), maturity 12/14/29	12/13/2021		2,500,000		2,477,500			2,468,750
Bettcher Industries, Senior Secured Initial Term Loan (First Lien), 5.04% (SOFR + 4.00%), maturity 12/14/28	12/13/2021		1,995,000		1,977,000			1,970,063
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			1,941,393
Kettle Cuisine, Senior Secured Initial Term Loan (First Lien), 6.04% (LIBOR + 3.75%), maturity 8/25/25	8/22/2018		1,925,000		1,920,615			1,896,125
Hissho Sushi, Unitranche, 6.75% (SOFR + 6.00%), maturity 5/18/28 (i) (j)	4/7/2022		1,857,143		1,818,418			1,820,000
Dessert Holdings, Senior Secured Initial Term Loan (First Lien), 6.29% (LIBOR + 4.00%), maturity 6/9/28	6/7/2021		1,488,750		1,478,895			1,481,306
Monogram Foods, Senior Secured Initial Term Loan, 6.29% (LIBOR + 4.00%), maturity 8/28/28	8/13/2021		995,000		986,000			972,613
Hissho Sushi, Senior Secured Revolving Credit Loan, 6.75% (SOFR + 6.00%), maturity 5/18/28 (i) (j)	4/7/2022		33,333		32,667			32,667
Automotive
Highline, Senior Secured Initial Term Loan (First Lien), 6.79% (LIBOR + 4.50%), maturity 11/9/27	10/29/2020		2,827,841		2,769,183			2,735,936
Burgess Point Purchaser Corporation, Senior Secured Term Loan, 5.75% (SOFR + 5.25%), maturity 7/31/29 (i) (j)	6/30/2022		3,000,000		2,700,000			2,700,000
Rough Country, Senior Secured Initial Term Loan (First Lien), 5.79% (LIBOR + 3.50%), maturity 7/28/28	7/26/2021		1,975,000		1,970,500			1,965,125
Truck Hero, Senior Secured Initial Term Loan, 4.00% (LIBOR + 3.25%), maturity 1/31/28 (i)	1/20/2021		1,481,250		1,481,250			1,346,278
IXS, Senior Secured Initial Term Loan, 6.54% (LIBOR + 4.25%), maturity 3/5/27	2/27/2020		790,270		788,592			764,587
Safe Fleet, Senior Secured Initial Term Loan (Second Lien), 9.04% (LIBOR + 6.75%), maturity 2/2/26	2/23/2022		500,000		500,000			496,250
Wheel Pros, Senior Secured Initial Term Loan (First Lien), 5.25% (LIBOR + 4.50%), maturity 5/11/28 (i)	4/23/2021		496,250		492,290			416,321
Construction & Building
Tangent, Senior Secured Closing Date Term Loan (First Lien), 7.04% (LIBOR + 4.75%), maturity 11/30/27	10/2/2019		1,785,932		1,777,413			1,765,840
PlayPower, Senior Secured Initial Term Loan, 7.79% (LIBOR + 5.50%), maturity 5/8/26	5/10/2019		1,747,195		1,747,195			1,624,891
PlayCore, Senior Secured Initial Term Loan (Second Lien), 10.04% (LIBOR + 7.75%), maturity 9/29/25	2/7/2020		1,500,000		1,477,670			1,496,250
Dodge Construction Network, Senior Secured Initial Term Loan (First Lien), 5.79% (SOFR + 4.75%), maturity 2/23/29	2/10/2022		1,000,000		985,952			1,000,000
PlayCore, Senior Secured Initial Term Loan (First Lien), 6.04% (LIBOR + 3.75%), maturity 9/30/24	9/18/2017		951,927		950,801			949,547
Specialty Products & Insulation, Senior Secured Tranche B-1 Term Loan, 6.29% (SOFR + 5.25%), maturity 12/21/27	3/16/2022		794,962		787,254			792,975
Acuren, Senior Secured Initial Term Loan, 6.54% (LIBOR + 4.25%), maturity 1/23/27	1/17/2020		476,270		474,553			476,270
Hoffman Southwest, Senior Secured Initial Term Loan, 7.04% (LIBOR + 4.75%), maturity 8/14/23	5/16/2019		434,492		434,898			432,319
Consumer Goods: Non-durable
Hoffmaster Group, Senior Secured Tranche B-1 Term Loan (First Lien), 6.29% (LIBOR + 4.00%), maturity 11/21/23	11/9/2016		2,381,171		2,377,183			2,285,924
Augusta Sportswear Group, Senior Secured Initial Term Loan, 5.50% (LIBOR + 4.50%), maturity 10/26/23 (k)	11/2/2016		2,001,028		1,995,099			1,991,023
Badger Sportswear, Senior Secured Initial Term Loan (First Lien), 6.79% (LIBOR + 4.50%), maturity 9/11/23	9/29/2016		1,881,139		1,876,189			1,876,436
Hoffmaster Group, Senior Secured Initial Term Loan (Second Lien), 11.79% (LIBOR + 9.50%), maturity 11/21/24	2/7/2020		1,250,000		1,250,000			1,209,375
Environmental Industries
Alliance Environmental Group, Unitranche, 7.00% (LIBOR + 6.00%), maturity 12/30/27 (j)	12/30/2021		4,136,507		4,058,427			4,136,507
Denali Water Solutions, Senior Secured Closing Date Term Loan, 6.54% (LIBOR + 4.25%), maturity 3/27/28	3/18/2021		1,980,000		1,962,000			1,960,200
Denali Water Solutions, Senior Secured Amendment No. 3 Term Loan, 5.67% (SOFR + 4.63%), maturity 3/27/28	5/5/2022		500,000		482,500			495,000
Keter Environmental Services, Unitranche, 5.23% (LIBOR + 2.94%), maturity 10/29/27	11/5/2021		497,500		493,000			493,769
Alliance Environmental Group, Senior Secured Revolving Loan, 7.00% (LIBOR + 6.00%), maturity 12/30/27 (j)	12/30/2021		149,007		142,384			149,007
Keter Environmental Services, Unitranche, 8.79% (LIBOR + 6.50%), maturity 10/29/27	11/5/2021		27,360		26,586			27,155
Wholesale
Carlisle FoodService, Senior Secured Initial Term Loan (First Lien), 4.00% (LIBOR + 3.00%), maturity 3/20/25 (k)	3/16/2018		3,829,693		3,830,178			3,791,396
Media: Diversified & Production
Cast & Crew, Senior Secured Initial Term Loan (First Lien), 3.50% (LIBOR + 3.50%), maturity 2/9/26 (i)	1/16/2019		2,909,867		2,896,421			2,801,961

The accompanying notes are an integral part of these financial statements.

9

Audax Credit BDC Inc.

Schedule of Investments (Continued)

As of June 30, 2022

(Expressed in U.S. Dollars)

(unaudited)

Portfolio Investments (a) (b) (c) (d) (e) (f)	Acquisition Date	Par		Cost		Value
BANK LOANS:  NON-CONTROL/NON-AFFILIATE INVESTMENTS(h) (Continued):
Hotels, Gaming & Leisure
Northstar, Senior Secured Term Loan, 6.75% (LIBOR + 6.25%) cash, 1.00% PIK maturity 6/7/24	5/8/2017	$	1,330,658	$	1,330,659	$	1,287,413
Auto Europe, Senior Secured Initial Dollar Term Loan, 7.29% (LIBOR + 5.00%), maturity 10/21/23	10/19/2016		1,119,231		1,115,522		895,385
Metals & Mining
Dynatect, Senior Secured Term B Loan, 6.79% (LIBOR + 4.50%), maturity 9/30/22	8/16/2019		1,905,588		1,896,111		1,905,588
Utilities: Electric
Systems Control, Senior Secured Initial Term Loan, 6.79% (LIBOR + 4.50%), maturity 3/28/25	6/15/2021		1,483,227		1,481,124		1,460,979
Forest Products & Paper
Loparex, Senior Secured Initial Term Loan (First Lien), 6.79% (LIBOR + 4.50%), maturity 7/31/26	7/29/2019		1,458,750		1,449,450		1,458,750
Retail
Varsity Brands, Senior Secured Initial Term Loan (First Lien), 4.50% (LIBOR + 3.50%), maturity 12/16/24 (i)	10/17/2018		962,254		966,029		911,947
StubHub, Senior Secured USD Term B Loan, 5.79% (LIBOR + 3.50%), maturity 2/12/27	1/31/2020		487,500		485,783		468,000
Media: Advertising, Printing & Publishing
Ansira, Unitranche, 7.50% (LIBOR + 6.50%) PIK, maturity 12/20/24	12/20/2016		2,220,865		2,215,572		1,376,936
Utilities: Water
Aegion, Senior Secured Initial Term Loan, 7.04% (LIBOR + 4.75%), maturity 5/17/28	4/1/2021		992,500		988,270		985,056
Energy: Electricity
Franklin Energy, Senior Secured Term B Loan (First Lien), 6.29% (LIBOR + 4.00%), maturity 8/14/26	8/14/2019		972,500		970,815		948,188
Consumer Goods: Durable
Careismatic Brands, Senior Secured Initial Term Loan (First Lien), 5.54% (LIBOR + 3.25%), maturity 1/6/28	1/22/2021		495,000		494,010		488,813
Total Bank Loans				$	440,648,277	$	434,509,039

Portfolio Investments (a) (b) (c) (d) (e) (f)	Acquisition Date	Par	Cost		Value
EQUITY AND PREFERRED SHARES:  NON-CONTROL/NON-AFFILIATE INVESTMENTS- (0.6%)(g)(h):
Services: Business
InnovateMR, Class A Units (387,311 Class A Units, Fair value of $470,019) (i) (j) (n) (o)	12/16/2021		$	387,311	$	470,019
Liberty Group, Series A-Preferred Units (113,636 Series A-Preferred Units, Fair value of $113,636) (i) (j) (n) (p)	6/6/2022			113,636		113,636
High Tech Industries
PracticeTek, Class A Units (318,350 Class A Units, Fair value of $311,804) (j) (n) (q)	11/22/2021			348,282		311,804
Golden Source, Class A Units (117,371 Class A Units, Fair value of $117,371) (i) (j) (n) (r)	3/25/2022			117,371		117,371
Environmental Industries
Alliance Environmental Group, A-1 Preferred Units (331,126 A-1 Preferred Units, Fair value of $348,454) (n) (s) (j)	9/30/2019			331,126		348,454
Services: Consumer
Ned Stevens, Class B Common Units (261,438 Common B Units, Fair value of $318,184) (n) (t) (u) (j)	9/30/2019			261,438		318,184
Chemicals, Plastics & Rubber
Vertellus, Series A Units (1,651 Series A Units, Fair value of $274,462) (n) (t) (v) (j)	12/22/2020			165,138		274,462
Beverage, Food & Tobacco
Hissho Sushi, Class A Units (25,000 Class A Units, Fair value of $250,000) (i) (j) (n) (w)	4/7/2022			250,000		250,000
Healthcare & Pharmaceuticals
Ivy Rehab, Class A Units (100 Class A Units, Fair value of $100,000) (j) (n) (x)	3/11/2022			100,000		100,000
Total Equity and Preferred Shares			$	2,074,302	$	2,303,930
Total Portfolio Investments(y)			$	442,722,579	$	436,812,969

(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) 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.

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

(l) The borrower for UDG Healthcare, Congachant Limited, is located in Ireland.

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

(n) Investment is non-income producing.

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

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

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

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

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

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

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

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

(y) At June 30, 2022, the cost of investments for income tax purposes was $442,722,579, the gross unrealized depreciation for federal tax purposes was $7,783,848, the gross unrealized appreciation for federal income tax purposes was $1,874,238, and the net unrealized depreciation was $5,909,610.

The accompanying notes are an integral part of these financial statements.

10

Audax Credit BDC Inc.

Schedule 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		$	4,168,783
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			4,145,626
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			3,717,970
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			3,475,319
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			3,377,784
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			3,266,217
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			3,169,814
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			2,955,024
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			2,831,780
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			2,410,524
Soliant, Senior Secured Initial Term Loan, 5.00% (Libor + 4.25%), maturity 3/31/28	3/26/2021		2,331,250		2,313,766			2,331,250
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			2,282,601
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			2,005,377
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			1,995,000
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			1,975,578
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			1,962,032
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			1,949,129
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			1,881,025
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			1,876,950
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			1,600,168
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			1,494,123
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			1,488,769
Blue Cloud, Unitranche, 6.00% (Libor + 5.00%), maturity 12/31/27 (i)	12/13/2021		1,500,000		1,485,000			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			1,481,306
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			1,481,288
CPS, Unitranche, 6.25% (Libor + 5.25%), maturity 2/28/25 (k)	3/1/2019		1,462,164		1,449,283			1,462,164
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			1,124,116
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			1,059,560
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			1,002,016
Wedgewood Pharmacy, Senior Secured Initial Term Loan, 5.00% (Libor + 4.25%), maturity 3/31/28	2/24/2021		997,500		987,800			997,500
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			992,500
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			990,000
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			981,573
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			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			928,800
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			634,124
ImageFirst, Senior Secured Initial Term Loan, 5.25% (Libor + 4.50%), maturity 4/27/28	4/26/2021		588,182		585,414			585,241
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			527,034
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			499,590
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			497,719
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			496,317
RMP & MedA/Rx, Senior Secured Term Loan, 5.50% (Libor + 4.50%), maturity 2/6/25	3/22/2021		490,625		485,865			489,398
AmeriVet, Senior Secured Incremental Delayed Draw Term Loan, 5.75% (Libor + 4.75%), maturity 6/5/24	8/27/2021		463,710		449,085			461,391
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			417,467
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			332,194
Alpaca, Senior Secured Revolver, 6.00% (Libor + 5.00%), maturity 4/19/24 (i)(k)	9/30/2019		129,426		125,543			129,426
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			4,496,243
InnovateMR, Unitranche, 6.75% (Libor + 5.75%), maturity 1/20/28 (i)(k)	12/16/2021		4,247,302		4,172,974			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			3,910,000
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			3,891,124
Alliance Environmental Group, Unitranche, 7.00% (Libor + 6.00%), maturity 12/30/27 (i) (k)	12/30/2021		3,675,497		3,588,742			3,601,987
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			3,104,654
Fleetwash, Senior Secured Incremental Term Loan, 5.75% (Libor + 4.75%), maturity 10/1/24	9/25/2018		2,903,063		2,888,125			2,888,547
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			2,578,679
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			2,470,032
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			2,346,764
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			2,317,605

The accompanying notes are an integral part of these financial statements.

11

Audax Credit BDC Inc.

Schedule 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		$	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			2,001,789
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			1,985,000
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			1,984,655
Veregy, Senior Secured Initial Term Loan, 7.00% (Libor + 6.00%), maturity 11/3/27	11/2/2020		1,980,000		1,928,567			1,960,200
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			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			1,492,509
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			1,489,968
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			1,478,116
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			1,429,947
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			1,097,467
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			997,500
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			997,500
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			996,581
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			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			994,805
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			989,251
Diversified, Senior Secured Initial Term Loan, 5.75% (Libor + 4.75%), maturity 12/23/23	4/19/2019		899,347		895,961			892,602
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			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			499,234
System One, Senior Secured Initial Term Loan, 4.75% (Libor + 4.00%), maturity 3/2/28 (i)	1/28/2021		497,500		495,300			497,500
Insight Global, Senior Secured Revolving Loan, 6.75% (Libor + 6.00%), maturity 9/22/27	9/23/2021		67,089		67,089			66,921
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			3,910,108
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			3,487,188
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			3,091,058
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			2,988,121
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			2,736,884
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			2,637,045
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			2,600,118
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			2,492,448
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			2,396,181
PracticeTek, Unitranche, 5.71% (Libor + 5.50%), maturity 11/23/27 (i)(k)	11/22/2021		2,275,763		2,210,067			2,230,248
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			1,959,343
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			1,940,250
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			1,931,121
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			1,642,542
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			1,606,567
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			1,493,953
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			1,446,663
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			999,322
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			997,873
Veracode, Senior Secured Initial Term Loan, 4.75% (Libor + 4.00%), maturity 11/5/27	10/30/2020		992,500		984,143			992,500
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			991,652
SmartBear, Senior Secured Initial Term Loan (First Lien), 4.75% (Libor + 4.25%), maturity 3/3/28	11/20/2020		995,000		985,600			990,025
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			989,981
Imperva, Senior Secured Term Loan, 5.00% (Libor + 4.00%), maturity 1/12/26 (i)	9/23/2020		986,095		978,665			986,963
Unison, Unitranche, 8.00% (Libor + 7.00%), maturity 6/25/26 (k)	6/25/2020		985,000		965,242			985,000
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			499,716
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			491,532
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			3,665,813
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			3,244,094
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			2,861,680
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			2,495,651
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			2,473,420
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			1,980,000
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			1,881,331
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			1,819,627
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			1,494,204
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			1,490,683
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			1,056,280
Lacerta, Senior Secured Term Loan, 6.25% (Libor + 5.50%), maturity 12/30/26	2/8/2021		990,000		980,150			990,000
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			979,185
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			971,563
Applied Adhesives, Senior Secured Term A Loan, 5.75% (Libor + 5.00%), maturity 3/12/27	3/12/2021		563,158		557,688			558,934
Golden West Packaging, Senior Secured Initial Term Loan, 6.00% (Libor + 5.25%), maturity 12/1/27	11/29/2021		500,000		495,000			496,250
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			492,516
Applied Adhesives, Senior Secured Revolving Loan, 5.75% (Libor + 5.00%), maturity 3/12/27	3/12/2021		7,111		6,400			7,058

The accompanying notes are an integral part of these financial statements.

12

Audax Credit BDC Inc.

Schedule 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	$	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		2,994,898
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		2,460,960
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		2,419,686
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		2,117,133
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		1,949,240
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		1,867,743
EPIC Insurance, Unitranche, 6.00% (Libor + 5.25%), maturity 9/29/28	8/27/2021		1,599,440		1,568,405		1,591,442
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		1,489,469
SIAA, Unitranche, 7.25% (Libor + 6.25%), maturity 4/28/28	4/21/2021		1,172,517		1,152,547		1,172,517
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		1,033,203
LERETA, Senior Secured Initial Term Loan, 6.00% (Libor + 5.25%), maturity 7/30/28 (i)	7/27/2021		997,500		987,500		995,006
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		811,133
Sedgwick Claims, Senior Secured Initial Term Loan, 3.46% (Libor + 3.25%), maturity 12/31/25 (i)	2/12/2020		489,899		489,422		486,901
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		2,985,000
Vertellus, Senior Secured Initial Term Loan, 7.00% (Libor + 6.00%), maturity 12/22/27	12/18/2020		2,977,500		2,905,500		2,970,056
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		2,574,630
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		2,403,249
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		1,996,853
USALCO, Senior Secured Term Loan A, 7.00% (Libor + 6.00%), maturity 10/19/27	10/26/2021		2,000,000		1,980,000		1,985,000
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		1,985,000
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		1,935,450
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		1,763,920
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		959,012
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		951,552
Polytek, Senior Secured Term Loan, 5.75% (Libor + 4.75%), maturity 9/20/24	12/23/2020		495,081		490,381		492,606
Ascensus Specialties, Senior Secured Initial Term Loan, 5.00% (Libor + 4.25%), maturity 6/30/28 (i)	12/3/2021		498,744		488,744		488,770
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		487,876
Vertellus, Senior Secured Revolving Credit Loan, 7.00% (Libor + 6.00%), maturity 12/22/25	12/18/2020		106,972		94,817		106,705
USALCO, Senior Secured Revolving Loan, 7.00% (Libor + 6.00%), maturity 10/19/26	10/26/2021		24,194		20,968		24,012
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		5,222,307
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		3,378,375
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		3,197,669
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		1,920,000
Whitcraft, Unitranche, 7.00% (Libor + 6.00%), maturity 4/3/23	3/6/2020		1,962,398		1,954,769		1,918,244
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		1,719,177
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		1,325,504
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		995,090
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		994,823
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		974,961
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		962,751
BlueHalo, Unitranche, 7.00% (Libor + 6.00%), maturity 10/31/25	11/17/2021		499,027		491,527		495,284
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		470,917
Novaria Group, Senior Secured Initial Term Loan, 6.50% (Libor + 5.50%), maturity 1/27/27	1/24/2020		481,818		477,971		466,159
BlueHalo, Senior Secured Revolving Loan, 7.00% (Libor + 6.00%), maturity 10/31/25	11/17/2021		25,305		23,815		25,115
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		3,960,000
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		3,850,705
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		2,011,277
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		1,506,460
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		1,302,395
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		1,184,320
TriMark, Senior Secured Initial Term Loan (First Lien), 3.71% (Libor + 3.50%), maturity 8/28/24	6/13/2018		973,447		902,470		759,288
Culligan, Senior Secured Initial Term B Loan, 4.50% (Libor + 4.00%), maturity 7/31/28 (i)	6/17/2021		500,000		497,500		502,107
Restaurant Technologies, Senior Secured Initial Loan (Second Lien), 6.71% (Libor + 6.50%), maturity 10/1/26	2/11/2020		500,000		503,008		498,750
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		496,938
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		492,387
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		485,701
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		421,414

The accompanying notes are an integral part of these financial statements.

13

Audax Credit BDC Inc.

Schedule 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		$	2,565,890
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			2,424,416
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			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			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			1,527,120
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			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			1,405,229
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			1,000,000
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			941,386
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			710,570
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			3,652,180
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			3,546,929
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			2,111,723
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			1,995,707
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			1,505,619
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			1,101,396
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			28,245
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			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			2,035,909
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			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			1,905,975
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			1,485,028
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			992,500
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			2,819,912
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			1,995,000
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			1,485,737
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			960,244
IXS, Senior Secured Initial Term Loan, 5.00% (Libor + 4.25%), maturity 3/5/27 (i)	2/27/2020		794,417		792,552			782,495
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			498,850
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			496,250
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			1,774,891
PlayPower, Senior Secured Initial Term Loan, 5.71% (Libor + 5.50%), maturity 5/8/26	5/10/2019		1,756,917		1,756,917			1,686,640
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			1,500,000
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			955,693
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			617,221
Acuren, Senior Secured Initial Term Loan, 4.21% (Libor + 4.00%), maturity 1/23/27	1/17/2020		479,011		477,104			479,011
Hoffman Southwest, Senior Secured Initial Term Loan, 6.50% (Libor + 5.50%), maturity 8/14/23	5/16/2019		446,460		446,911			441,437
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			3,806,310
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			1,814,241
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			1,389,209
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			2,871,577
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			1,321,856
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			895,385
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			2,245,348
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			1,994,321
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			1,857,624
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			1,209,375

The accompanying notes are an integral part of these financial statements.

14

Audax Credit BDC Inc.

Schedule 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	$	2,928,921
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		1,967,613
Keter Environmental Services, Unitranche, 7.50% (Libor + 6.50%), maturity 10/29/27 (i)	11/5/2021		500,000		495,000		495,000
Keter Environmental Services, Unitranche, 7.50% (Libor + 6.50%), maturity 10/29/27 (i)	11/5/2021		4,560		4,514		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		1,917,692
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		1,472,336
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		1,462,584
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		952,067
StubHub, Senior Secured USD Term B Loan, 3.71% (Libor + 3.50%), maturity 2/12/27 (i)	1/31/2020		490,000		488,093		481,558
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		1,346,607
Utilities: Water
Aegion, Senior Secured Initial Term Loan, 5.50% (Libor + 4.75%), maturity 5/17/28	4/1/2021		997,500		992,800		995,006
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		962,838
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		496,361
Total Bank Loans				$	403,106,122	$	401,708,017
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, Fair value of $348,282)(k)(l)(o)	11/22/2021			$	348,282	$	348,282
Services: Business
Alliance Environmental Group, A-1 Preferred Units (331,126 A-1 Preferred Units, Fair value of $331,126)(k)(l)(p)	12/30/2021				331,126		331,126
Services: Consumer
Ned Stevens, Class B Common Units (261,438 Common B units, Fair value of $280,604)(k)(l)(q)(t)	9/30/2019				261,438		280,604
Healthcare & Pharmaceuticals
Alpaca, Class A Units (45,746 Class A Units, Fair value of $205,742)(k)(l)(r)(t)	4/19/2019				80,512		205,742
Chemicals, Plastics & Rubber
Vertellus, Series A Units (1,651 Series A units, Fair value of $180,603)(l)(m)(t)	12/22/2020				165,138		180,603
Total Equity and Preferred Shares				$	1,186,496	$	1,346,357
Total Portfolio Investments(u)				$	404,292,618	$	403,054,374

(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.

The accompanying notes are an integral part of these financial statements.

15

Audax Credit BDC Inc.

Notes to Financial Statements

June 30, 2022

(unaudited)

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 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 (“ASC Topic 946”), which incorporates the requirements for reporting on Form 10-Q and Articles 6 and 10 of Regulation S-X, as well as generally accepted accounting principles in the United States of America (“GAAP”).

Certain financial information that is normally included in annual financial statements, including certain financial statement footnotes, prepared in accordance with GAAP, is not required for interim reporting purposes and has been condensed or omitted herein. Accordingly, certain disclosures accompanying annual financial statements prepared in accordance with GAAP are omitted. In the opinion of management of the Company, the unaudited financial results included herein contain all adjustments, consisting solely of normal accruals, considered necessary for the fair presentation of financial statements for the interim period included herein. The current period’s results of operations are not necessarily indicative of the operating results to be expected for future periods. The accounting records of the Company are maintained in U.S. dollars.

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.

16

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 on June 30, 2022 and December 31, 2021. At such dates, 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.

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.

17

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, 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.

18

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;

· 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 new rule clarifies how fund boards can satisfy their valuation obligations in light of recent market developments. The rule will permit boards, subject to board oversight and certain other conditions, to designate certain parties to perform the fair value determinations. As of June 30, 2022, no changes to the Company’s valuation policy have occurred as a result of this new rule.

19

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 June 30, 2022 and December 31, 2021, the Company did not hold any investment on non-accrual.

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 June 30, 2022, the Company held 230 investments in loans with OID. The Company accrued OID income of $157,869 and $302,788 for the three and six months ended June 30, 2022, respectively. The unamortized balance of OID on debt investments as of June 30, 2022, totaled $4,220,194. As of December 31, 2021, the Company held 231 investments in loans with OID. The Company accrued OID income of $110,757 and $229,309 for the three and six months ended June 30, 2021, respectively. The unamortized balance of OID investments as of December 31, 2021, totaled $3,028,962.

As of June 30, 2022, the Company held three investments which had a PIK interest component. The Company recorded $7,813 and $69,132 of PIK interest income for three and six months ended June 30, 2022, respectively. As of June 30, 2021, the Company held three investments which had a PIK interest component. The Company recorded $110,285 and $150,783 of PIK interest income for three and six months ended June 30, 2021, respectively.

As of June 30, 2022 and December 31, 2021, the Company held $31,727,018 and $11,058,796 in cash and cash equivalents, respectively. For the three and six months ended June 30, 2022, the Company earned $397 and $781, respectively, of interest income related to cash, which is included in other interest income within the accompanying statement of operations. For the three and six months ended June 30, 2021, the Company earned $356 and $630, 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 and amendment fees upon receipt of cash or as soon as the Company becomes aware of the prepayment or amendment.

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, amendment fees and dividend income are accrued in other income in the accompanying statements of operations.

20

For the three and six months ended June 30, 2022, the Company accrued $140,256 and $178,374 of other income, respectively, related to amendment fees. For the three and six months ended June 30, 2021, the Company accrued $15,488 and $63,002 of other income, respectively, 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, 2022. Management is currently evaluating the impact of the guidance.

Note 3. Investments

Fair Value

In accordance with ASC 820, the fair value of the Company’s investments 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 June 30, 2022, $286,857,096 of the Company’s investments were valued using unobservable inputs, and $149,955,873 were valued using observable inputs. During the six months ended June 30, 2022, $132,817,640 were transferred into Level 3 due to a decrease in observable prices in the market and $10,027,381 were 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 six months ended June 30, 2021, $23,687,416 were transferred into Level 3 due to a decrease in observable prices in the market and $45,016,934 were transferred out of Level 3 due to price transparency.

The following table presents the Company’s investments carried at fair value as of June 30, 2022 and December 31, 2021, by caption on the Company’s accompanying statements of assets and liabilities and by security type.

	Assets at Fair Value as of June 30, 2022
	Level 1		Level 2		Level 3		Total
First lien debt	$	-	$	146,504,847	$	261,879,227	$	408,384,074
Second lien debt		-		2,500,000		23,624,965		26,124,965
Equity and Preferred Shares		-		951,026		1,352,904		2,303,930
Total	$	-	$	149,955,873	$	286,857,096	$	436,812,969

21

	Assets at Fair Value as of December 31, 2021
	Level 1		Level 2		Level 3		Total
First lien debt	$	-	$	239,920,774	$	137,142,045	$	377,062,819
Second lien debt		-		9,943,690		14,701,508		24,645,198
Equity and Preferred Shares		-		-		1,346,357		1,346,357
Total	$	-	$	249,864,464	$	153,189,910	$	403,054,374

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 June 30, 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.

					As of June 30, 2022
	Fair Value		Valuation Technique	Unobservable Inputs (1)	Range (2)	Weighted Average (3)
First lien debt	$	250,769,962	Matrix Pricing	Senior Leverage	0.45x - 16.25x	5.47x
				Total Leverage	0.45x - 19.49x	6.32x
				Interest Coverage	(0.55)x - 22.35x	2.65x
				Debt Service Coverage	(0.50)x - 16.18x	2.14x
				TEV Coverage	0.71x - 18.29x	2.44x
				Liquidity	25.36% - 588.40%	136.81%
				Spread Comparison	300bps - 700bps	468bps
	11,109,265		Market Analysis	Senior Leverage	(415.90)x - 533.03x	48.75x
				Total Leverage	(415.90)x - 533.03x	50.09x
				Interest Coverage	(0.77)x - 1.62x	0.82x
				Debt Service Coverage	(0.78)x - 1.29x	0.64x
				TEV Coverage	(0.04)x - 1.82x	0.91x
				Liquidity	27.57% - 546.48%	91.88%
				Spread Comparison	250bps - 650bps	470bps
Second lien debt	23,624,965		Matrix Pricing	Senior Leverage	4.10x - 10.03x	7.02x
				Total Leverage	4.10x - 10.03x	7.03x
				Interest Coverage	0.64x - 6.99x	2.81x
				Debt Service Coverage	0.51x - 4.61x	2.00x
				TEV Coverage	0.80x - 2.72x	1.74x
				Liquidity	63.73% - 210.00%	139.78%
				Spread Comparison	675bps - 950bps	758bps
Total	$	285,504,192

(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 LIBOR for each investment to the spread over LIBOR 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 $1,352,904 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.

22

					As of December 31, 2021
	Fair Value		Valuation Technique	Unobservable  Inputs (1)	Range (2)	Weighted Average (3)
First lien debt	$	131,493,405	Matrix Pricing	Senior Leverage	2.66x - 19.28x	5.48x
				Total Leverage	2.66x - 19.28x	6.35x
				Interest Coverage	(1.00)x - 7.01x	2.53x
				Debt Service Coverage	(0.92)x - 5.85x	2.03x
				TEV Coverage	0.48x - 6.32x	2.44x
				Liquidity	28.32% - 871.75%	140.19%
				Spread Comparison	300bps - 700bps	468bps
Second lien debt	14,701,508		Matrix Pricing	Senior Leverage	4.05x - 11.68x	7.04x
				Total Leverage	4.05x - 11.68x	7.04x
				Interest Coverage	0.67x - 5.98x	2.84x
				Debt Service Coverage	0.53x - 4.66x	2.24x
				TEV Coverage	0.68x - 3.08x	1.70x
				Liquidity	56.63% - 353.33%	168.01%
				Spread Comparison	650bps - 950bps	782bps
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 LIBOR for each investment to the spread over LIBOR 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 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 rate, leverage, EBITDA 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 an increase/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 six months ended June 30, 2022 and 2021 for all investments for which the Company determines fair value using unobservable (Level 3) factors.

Six Months Ended June 30, 2022	First lien debt			Second lien debt			Equity and Preferred Shares			Total
Fair Value as of December 31, 2021	$	137,142,045		$	14,701,508		$	1,346,357		$	153,189,910
Transfers into Level 3		124,380,410			8,437,230			-			132,817,640
Transfers out of Level 3		(9,029,881	)		(997,500	)		-			(10,027,381	)
Total gains:
Net realized gain (a)		179,924			5,583			107,938			293,445
Net unrealized appreciation (depreciation)(b)		135,921			21,638			(12,941	)		144,618
New investments, repayments and settlements:(c)
Purchases		33,849,617			2,440,000			100,000			36,389,617
Settlements/repayments		(24,079,109	)		(1,000,000	)		-			(25,079,109	)
Net amortization of premiums, PIK, discounts and fees		288,205			16,506			-			304,711
Sales		(987,905	)		-			(188,450	)		(1,176,355	)
Fair Value as of June 30, 2022	$	261,879,227		$	23,624,965		$	1,352,904		$	286,857,096

(a) Included in net realized gain on the accompanying Statement of Operations for the six months ended June 30, 2022.

(b) Included in net change in unrealized appreciation on the accompanying Statement of Operations for the six months ended June 30, 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.

23

Six Months Ended June 30, 2021	First lien debt			Second lien debt			Equity and Preferred Shares			Total
Fair Value as of December 31, 2020	$	170,910,171		$	27,290,845		$	799,189		$	199,000,205
Transfers into Level 3		23,522,278			-			165,138			23,687,416
Transfers out of Level 3		(41,048,184	)		(3,968,750	)		-			(45,016,934	)
Total gains:
Net realized gain (loss)(a)		101,904			24,823			(383,174	)		(256,447	)
Net unrealized appreciation (depreciation)(b)		124,987			(582	)		244,306			368,711
New investments, repayments and settlements:(c)
Purchases		20,059,197			2,455,000			19,536			22,533,733
Settlements/repayments		(23,022,823	)		(3,950,000	)		-			(26,972,823	)
Net amortization of premiums, PIK, discounts and fees		198,158			77,380			-			275,538
Sales		-			(1,445,770	)		(417,361	)		(1,863,131	)
Fair Value as of June 30, 2021	$	150,845,688		$	20,482,946		$	427,634		$	171,756,268

(a) Included in net realized loss on the accompanying Statement of Operations for the six months ended June 30, 2021.

(b) Included in net change in unrealized depreciation on the accompanying Statement of Operations for the six months ended June 30, 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 June 30, 2022 and 2021 was $61,229 and $185,542, respectively.

Investment Activities

The Company held a total of 254 investments with an aggregate fair value of $436,812,969 as of June 30, 2022. During the six months ended June 30, 2022, the Company invested in 66 new investments for a combined $67,368,883 and in existing investments for a combined $7,468,693. The Company also received $33,069,168 in repayments from investments and $4,047,932 from investments sold during the six months ended June 30, 2022.

The Company held a total of 251 investments with an aggregate fair value of $403,054,374 as of December 31, 2021. During the six months ended June 30, 2021, the Company invested in 43 new investments for a combined $48,768,159 and in existing investments for a combined $6,849,818. The Company also received $47,805,480 in repayments from investments and $10,135,008 from investments sold during the six months ended June 30, 2021.

Investment Concentrations

As of June 30, 2022, the Company’s investment portfolio consisted of investments in 228 companies located in 37 states across 26 different industries, with an aggregate fair value of $436,812,969. The five largest investments at fair value as of June 30, 2022 totaled $24,248,880, or 5.55%, of the Company’s total investment portfolio as of such date. As of June 30, 2022, the Company’s average investment was $1,743,002 at cost.

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.

24

The following table outlines the Company’s investments by security type as of June 30, 2022 and December 31, 2021:

	June 30, 2022										December 31, 2021
	Cost		Percentage of Total Investments			Fair Value		Percentage of Total Investments			Cost		Percentage of Total Investments			Fair Value		Percentage of Total Investments
First lien debt	$	414,508,206		93.63	%	$	408,384,074		93.49	%	$	378,430,188		93.60	%	$	377,062,819		93.55	%
Second lien debt		26,140,071		5.90	%		26,124,965		5.98	%		24,675,934		6.10	%		24,645,198		6.11	%
Total Debt Investments		440,648,277		99.53	%		434,509,039		99.47	%		403,106,122		99.71	%		401,708,017		99.67	%
Equity and Preferred Shares		2,074,302		0.47	%		2,303,930		0.53	%		1,186,496		0.29	%		1,346,357		0.33	%
Total Equity Investments		2,074,302		0.47	%		2,303,930		0.53	%		1,186,496		0.29	%		1,346,357		0.33	%
Total Investments	$	442,722,579		100.00	%	$	436,812,969		100.00	%	$	404,292,618		100.00	%	$	403,054,374		100.00	%

Investments at fair value consisted of the following industry classifications as of June 30, 2022 and December 31, 2021:

	June 30, 2022				December 31, 2021
Industry	Fair Value		Percentage of Total Investments		Fair Value		Percentage of Total Investments
Healthcare & Pharmaceuticals	$	74,667,960	17.07	%	$	76,579,770	19.01	%
Services: Business		67,359,216	15.42			63,977,738	15.87
High Tech Industries		56,067,996	12.84			49,862,684	12.37
Containers, Packaging & Glass		34,127,069	7.81			28,958,289	7.18
Banking, Finance, Insurance & Real Estate		28,773,585	6.59			25,369,331	6.29
Aerospace & Defense		27,372,464	6.27			24,066,376	5.97
Capital Equipment		26,713,233	6.12			17,471,742	4.33
Chemicals, Plastics & Rubber		21,422,711	4.90			24,290,294	6.03
Services: Consumer		17,815,971	4.08			16,280,215	4.04
Transportation: Cargo		16,943,999	3.88			13,941,799	3.46
Beverage, Food & Tobacco		12,832,916	2.94			10,874,412	2.70
Automotive		10,424,497	2.39			9,038,488	2.24
Construction & Building		8,538,092	1.95			7,454,893	1.85
Consumer Goods: Non-durable		7,362,758	1.69			7,306,668	1.81
Environmental Industries		7,610,091	1.74			2,467,127	0.61
Wholesale		3,791,396	0.87			7,009,760	1.74
Media: Diversified & Production		2,801,961	0.64			2,928,921	0.73
Hotels, Gaming & Leisure		2,182,798	0.50			5,088,818	1.26
Metals & Mining		1,905,588	0.44			1,917,692	0.48
Utilities: Electric		1,460,979	0.33			1,472,336	0.37
Forest Products & Paper		1,458,750	0.33			1,462,584	0.36
Retail		1,379,947	0.32			1,433,625	0.36
Media: Advertising, Printing & Publishing		1,376,936	0.32			1,346,607	0.33
Utilities: Water		985,056	0.23			995,006	0.25
Energy: Electricity		948,188	0.22			962,838	0.24
Consumer Goods: Durable		488,813	0.11			496,361	0.12
	$	436,812,969	100.00	%	$	403,054,374	100.00	%

25

Investments at fair value were included in the following geographic regions of the United States as of June 30, 2022 and December 31, 2021:

	June 30, 2022					December 31, 2021
Geographic Region	Fair Value		Percentage of Total Investments			Fair Value		Percentage of Total Investments
Northeast	$	105,423,529		24.14	%	$	96,521,842		23.95	%
Midwest		92,748,094		21.23			86,519,372		21.47
West		63,119,739		14.45			60,016,533		14.89
Southeast		59,556,262		13.63			57,007,985		14.14
Southwest		55,168,446		12.63			57,181,529		14.19
East		43,881,653		10.05			33,945,083		8.42
Northwest		5,065,136		1.16			4,501,322		1.12
South		7,427,820		1.70			4,767,241		1.18
Other(a)		4,422,290		1.01			2,593,467		0.64
Total Investments	$	436,812,969		100.00	%	$	403,054,374		100.00	%

(a) The borrower for Sophos, Surf Holdings S.a.r.l., is located in United Kingdom.  The borrower for UDG Healthcare, Congachant Limited, is located in Ireland.

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 June 30, 2022:

For the Fiscal Years Ending December 31:		Amount
	2022	$	7,143,814
	2023		19,180,425
	2024		45,150,605
	2025		61,448,517
	2026		67,342,344
	Thereafter		244,602,766
	Total contractual repayments		444,868,471
	Adjustments to cost basis on debt investments (a)		(4,220,194	)
	Total Cost Basis of Investments Held at June 30, 2022:	$	440,648,277

(a) Adjustment to cost basis related to unamortized balance of OID investments.

COVID-19 Developments

During the six months ended June 30, 2022, the COVID-19 pandemic has had a significant impact on the U.S. economy. Certain of the Company’s portfolio companies have been adversely impacted by the effects of the COVID-19 pandemic, which have resulted in a material adverse impact on the Company’s net asset value, net investment income, the fair value of its portfolio investments, its financial condition and the results of operations and financial condition of the Company’s portfolio companies and may continue to adversely affect the Company’s future net asset value, net investment income, the fair value of its portfolio investments, its financial condition and the results of operations and financial condition of the Company’s portfolio companies.

26

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 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 three and six months ended June 30, 2022, the Company recorded base management fees of $1,082,214 and $2,120,653, respectively, and waivers to the base management fees of $378,775 and $742,229, respectively, as set forth within the accompanying statements of operations. For the three and six months ended June 30, 2021, the Company recorded base management fees of $948,730 and $1,862,780, respectively, and waivers to the base management fees of $332,055 and $651,972, respectively, as set forth within the accompanying statements of operations.

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).

27

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, 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.

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.

28

For the three and six months ended June 30, 2022, the Company recorded incentive fees related to net investment income of $747,892 and $1,174,214, respectively. Offsetting the incentive fees were waivers of the incentive fees of $654,618 and $1,038,308 for the three and six months ended June 30, 2022, respectively, as set forth within the accompanying statements of operations. For the three and six months ended June 30, 2021, the Company recorded incentive fees related to net investment income of $96,455 and $387,748, respectively. Offsetting the incentive fees were waivers of the incentive fees of $86,809 and $348,973 for the three and six months ended June 30, 2021, respectively, as set forth within the accompanying statements of operations.

Administration Agreement and 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.

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.

The Company accrued administrative fees of $66,250 and $132,500 for the three and six months ended June 30, 2022, respectively, as set forth within the accompanying statements of operations. The Company accrued administrative fees of $66,250 and $132,500 for the three and six months ended June 30, 2021, respectively, as set forth within the accompanying statements of operations.

Related Party Fees

Fees due to related parties as of June 30, 2022 and December 31, 2021 on the Company’s accompanying statements of assets and liabilities were as follows:

	June 30, 2022		December 31, 2021
Net base management fee due to Adviser	$	703,439	$	620,269
Net incentive fee due to Adviser		93,274		20,060
Total fees due to Adviser, net of waivers		796,713		640,329
Fee due to Administrator, net of waivers		66,250		66,250
Total Related Party Fees Due	$	862,963	$	706,579

29

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 the Company’s common stock, par value $0.001 per share (the “Common Stock”), for the three and six months ended June 30, 2022 and 2021:

	Three Months Ended June 30, 2022		Three Months Ended June 30, 2021		Six Months Ended June 30, 2022		Six Months Ended June 30, 2021
Numerator for basic and diluted net increase in net assets resulting from operations per common share	$	1,898,573	$	4,221,191	$	4,944,381	$	9,298,545
Denominator for basic and diluted weighted average common shares		44,710,073		39,009,531		43,742,436		38,983,776
Basic and diluted net increase in net assets resulting from operations per common share	$	0.04	$	0.11	$	0.11	$	0.24

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, and intends to comply with the requirements to qualify annually, 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.

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. The Company had aggregate distributions declared and paid to its stockholders for the year ended December 31, 2020 of $16,177,757, or $0.43 per share. The tax character of the distributions declared and paid represented $15,911,638 from ordinary income and $266,119 from tax return of capital.

During the three and six months ended June 30, 2022, the Company declared distributions of $8,739,352, or $0.20 per share. The tax character of the distributions declared represented $8,739,352 from ordinary income. During the three and six months ended June 30, 2021, the Company declared and paid distributions of $7,801,905, or $0.20 per share. The tax character of the distributions declared and paid represented $7,656,579 from ordinary income and $145,326 from tax return capital.

30

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

U.S. GAAP requires 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 years ended December 31, 2021 and 2020, 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 years ended December 31, 2021 and 2020, 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, 2021		Year Ended December 31, 2020
Capital in excess of par value	$	-	$	-
Accumulated net investment income		-		(37,662	)
Accumulated net realized gain (loss)		-		37,662

At December 31, 2021 and 2020, 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, 2021			As of December 31, 2020
Other temporary book/tax differences	$	(172,677	)	$	(192,992	)
Net tax basis unrealized depreciation		(1,238,244	)		(3,630,949	)
Accumulated net realized loss		(3,353,867	)		(3,157,649	)
Components of tax distributable (loss) earnings at period end	$	(4,764,788	)	$	(6,981,590	)

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, 2021.

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, 2021, the Company has long-term capital loss carryforward of $3,353,867. 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 2019, 2020, and 2021 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, 2021, 2020, and 2019, no tax expense or any related interest or penalties were incurred.

31

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 June 30, 2022, $55,000,000 of total capital commitments remained unfunded by the Company’s investors.

The number of shares of Common Stock issued and outstanding as of June 30, 2022 and December 31, 2021, were 43,696,762 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 expired on May 19, 2022.

The following table details the activity of Stockholders’ Equity for the three and six months ended June 30, 2022 and 2021:

Three Months Ended June 30, 2022	Common Stock		Capital in Excess of Par Value			Total Distributable (Loss) Earnings			Total Stockholders’ Equity
Balance as of March 31, 2022	$	43,167	$	408,668,955		$	(1,718,980	)	$	406,993,142
Net investment income		-		-			4,891,997			4,891,997
Net realized gain from investment transactions		-		-			111,779			111,779
Net change in unrealized appreciation on investments		-		-			(3,105,203	)		(3,105,203	)
Issuance of shares		530		24,999,470			-			25,000,000
Repurchase of shares		-		(20,000,000	)		-			(20,000,000	)
Distributions to Stockholders		-		-			(8,739,352	)		(8,739,352	)
Reinvested Dividends		-		27			-			27
Balance as of June 30, 2022	$	43,697	$	413,668,452		$	(8,559,759	)	$	405,152,390

Three Months Ended June 30, 2021	Common Stock		Capital in Excess of Par Value			Total Distributable (Loss) Earnings			Total Stockholders’ Equity
Balance as of March 31, 2021	$	39,009	$	370,025,442		$	(1,904,236	)	$	368,160,215
Net investment income		-		-			3,768,409			3,768,409
Net realized gain from investment transactions		-		-			(696,642	)		(696,642	)
Net change in unrealized appreciation on investments		-		-			1,149,424			1,149,424
Issuance of shares		-		-			-			-
Distributions to Stockholders		-		(145,326	)		(7,656,579	)		(7,801,905	)
Reinvested Dividends		-		25			-			25
Balance as of June 30, 2021	$	39,009	$	369,880,141		$	(5,339,624	)	$	364,579,526

32

Six Months Ended June 30, 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	)	$	373,947,334
Net investment income		-		-			9,278,182			9,278,182
Net realized gain from investment transactions		-		-			337,565			337,565
Net change in unrealized appreciation on investments		-		-			(4,671,366	)		(4,671,366	)
Issuance of shares		3,736		54,996,264			-			55,000,000
Repurchase of shares		-		(20,000,000	)		-			(20,000,000	)
Distributions to Stockholders		-		-			(8,739,352	)		(8,739,352	)
Reinvested Dividends		-		27			-			27
Balance as of June 30, 2022	$	43,697	$	413,668,452		$	(8,559,759	)	$	405,152,390

Six Months Ended June 30, 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	)	$	356,882,861
Net investment income		-		-			7,656,579			7,656,579
Net realized gain from investment transactions		-		-			(633,372	)		(633,372	)
Net change in unrealized appreciation on investments		-		-			2,275,338			2,275,338
Issuance of shares		666		6,199,334			-			6,200,000
Distributions to Stockholders		-		(145,326	)		(7,656,579	)		(7,801,905	)
Reinvested Dividends		-		25			-			25
Balance as of June 30, 2021	$	39,009	$	369,880,141		$	(5,339,624	)	$	364,579,526

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 June 30, 2022, the Company had short-term borrowings outstanding of $35,894,306. For the three and six months ended June 30, 2022, the Company recorded interest expense in connection with short-term borrowings of $95,634 and $136,800, respectively. As of June 30, 2021, the Company had no short-term borrowings outstanding. For the three and six months ended June 30, 2021, the Company recorded no interest expense in connection with short-term borrowings. As of December 31, 2021, the Company had short-term borrowing outstanding of $8,224,250. As of December 31, 2021, the Company recorded no interest expense in connection with short-term borrowings.

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.

33

The following table summarizes the Company’s significant contractual payment obligations as of June 30, 2022 and December 31, 2021:

Investment	Industry	June 30, 2022		December 31, 2021
PracticeTek, Senior Secured Delayed Draw Term Loan, 7.79% (LIBOR + 5.50%), maturity 11/23/27	High Tech Industries	$	1,889,312	$	2,862,595
Cherry Bekaert, Senior Secured Delayed Draw Term Loan, 2.29%, maturity 1/0/00	Banking, Finance, Insurance & Real Estate		1,232,944		-
American Vision Partners, Senior Secured Delayed Draw Term Loan, 8.04% (LIBOR + 5.75%), maturity 9/30/27	Healthcare & Pharmaceuticals		1,872,093		1,453,488
EdgeCo, Senior Secured Delayed Draw Term D Loan, 5.79% (SOFR + 4.75%), maturity 6/1/26	Banking, Finance, Insurance & Real Estate		1,200,000		-
Golden Source, Senior Secured Delayed Draw Term Loan, 6.54% (SOFR + 5.50%), maturity 5/31/28	High Tech Industries		938,967		-
Discovery Education, Senior Secured Delayed Draw Term Loan, 6.79% (SOFR + 5.75%), maturity 3/10/29	Services: Business		807,692		-
Ned Stevens, Senior Secured Delayed Draw Term Loan, 7.04% (SOFR + 6.00%), maturity 6/30/29	Services: Consumer		798,838		-
Advarra, Senior Secured Initial Revolving Loan (First Lien), 6.54% (LIBOR + 4.25%), maturity 7/9/24	Healthcare & Pharmaceuticals		761,905		761,905
Eliassen, Senior Secured Initial Delayed Draw Term Loan, 6.79% (SOFR + 5.75%), maturity 4/7/28	Services: Business		740,741		-
Paradigm Oral Health, Senior Secured Delayed Draw Term Loan, 5.79% (SOFR + 4.75%), maturity 7/9/26	Healthcare & Pharmaceuticals		621,481		-
Cherry Bekaert, Senior Secured Revovling Credit, 2.29%, maturity 6/30/28	Banking, Finance, Insurance & Real Estate		616,472		-
The Facilities Group, Senior Secured Delayed Draw Term Loan, 8.04% (LIBOR + 5.75%), maturity 11/30/27	Services: Business		602,601		758,671
Advancing Eyecare, Senior Secured Initial Delayed Draw Term Loan, 6.79% (SOFR + 5.75%), maturity 6/13/29	Healthcare & Pharmaceuticals		500,000		-
Golden Source, Senior Secured Revolving Credit, 6.54% (SOFR + 5.50%), maturity 5/31/28	High Tech Industries		469,484		-
CoolSys, Senior Secured Delayed Draw Term Loan, 7.04% (LIBOR + 4.75%), maturity 8/11/28	Services: Business		465,278		465,278
Vertellus, Senior Secured Revolving Credit Loan, 8.29% (LIBOR + 6.00%), maturity 12/22/25	Chemicals, Plastics and Rubber		413,303		379,266
Blue Cloud, Senior Secured Delayed Draw Term Loan, 6.04% (SOFR + 5.00%), maturity 1/21/28	Healthcare & Pharmaceuticals		400,000		-
Therapy Brands, Senior Secured Delayed Draw Term Loan (First Lien), 6.29% (LIBOR + 4.00%), maturity 5/18/28	Healthcare & Pharmaceuticals		382,979		382,979
Micro Merchant Systems, Senior Secured Delayed Draw Term Loan, 8.04% (LIBOR + 5.75%), maturity 12/14/27	Healthcare & Pharmaceuticals		370,370		-
InnovateMR, Senior Secured Revolving Loan, 8.04% (LIBOR + 5.75%), maturity 1/20/28	Services: Business		365,388		-
PracticeTek, Senior Secured Revolving Loan, 7.79% (LIBOR + 5.50%), maturity 11/23/27	High Tech Industries		357,824		357,824
Liberty Group, Senior Secured Delayed Draw Term Loan, 2.29%, maturity 6/9/28	Services: Business		340,909		-
Evans Network, Senior Secured Delayed Draw Term Loan (First Lien), 6.54% (LIBOR + 4.25%), maturity 8/19/28	Transportation: Cargo		326,531		326,531
Paragon Films, Senior Secured Delayed Draw Term Loan (First Lien), 7.29% (LIBOR + 5.00%), maturity 12/16/28	Containers, Packaging and Glass		297,030		297,030
Dessert Holdings, Senior Secured Delayed Draw Term Loan (First Lien), 6.29% (LIBOR + 4.00%), maturity 6/9/28	Beverage, Food and Tobacco		281,250		281,250
BETA, Senior Secured Revolving Credit Facility, 6.29% (SOFR + 5.25%), maturity 7/1/27	Banking, Finance, Insurance & Real Estate		276,289		-
Ned Stevens, Senior Secured Revolving Credit, 7.04% (SOFR + 6.00%), maturity 6/30/28	Services: Consumer		237,836		-
Discovery Education, Senior Secured Revolving Facility, 6.79% (SOFR + 5.75%), maturity 4/7/28	Services: Business		230,769		-
Blue Cloud, Senior Secured Revolving Loan, 6.04% (SOFR + 5.00%), maturity 1/21/28	Healthcare & Pharmaceuticals		227,273		-
FLS Transportation, Senior Secured Delayed Draw Term Loan, 7.54% (LIBOR + 5.25%), maturity 12/18/28	Transportation: Cargo		217,391		-
EPIC Insurance, Senior Secured Delayed Draw Term Loan, 7.54% (LIBOR + 5.25%), maturity 9/29/28	Banking, Finance, Insurance & Real Estate		210,093		241,379
Specialty Products & Insulation, Senior Secured Delayed Draw Term Loan, 6.29% (SOFR + 5.25%), maturity 12/21/27	Construction & Building		203,046		-
Radwell, Senior Secured Delayed Draw Term Loan, 6.79% (SOFR + 5.75%), maturity 4/1/29	Capital Equipment		200,001		-
Alliance Environmental Group, Senior Secured Delayed Draw Term Loan, 8.29% (LIBOR + 6.00%), maturity 12/30/27	Environmental Industries		182,119		662,252
Alliance Environmental Group, Senior Secured Revolving Loan, 8.29% (LIBOR + 6.00%), maturity 12/30/27	Environmental Industries		182,119		331,126
Liberty Group, Senior Secured Revolving Loan, 2.29%, maturity 6/9/28	Services: Business		181,818		-
Ivy Rehab, Senior Secured Delayed Draw Term Loan (First Lien), 5.79% (SOFR + 4.75%), maturity 2/17/29	Healthcare & Pharmaceuticals		179,739		-
Epic Staffing Group, Senior Secured Delayed Draw Term Loan, 7.04% (SOFR + 6.00%), maturity 6/28/29	Healthcare & Pharmaceuticals		174,419		-
USALCO, Senior Secured Revolving Loan, 8.29% (LIBOR + 6.00%), maturity 10/19/26	Chemicals, Plastics and Rubber		169,355		298,387
Ivy Rehab, Senior Secured Revolving Credit (First Lien), 5.79% (SOFR + 4.75%), maturity 3/15/28	Healthcare & Pharmaceuticals		168,350		-
EPIC Insurance, Senior Secured Revolving Loan, 7.54% (LIBOR + 5.25%), maturity 9/30/27	Banking, Finance, Insurance & Real Estate		161,841		125,909
Integro Insurance Brokers, Senior Secured Delayed Draw Term Loan, 8.04% (LIBOR + 5.75%), maturity 10/31/22	Banking, Finance, Insurance & Real Estate		161,041		-
Secretariat International, Senior Secured Delayed Draw Term Loan (First Lien), 7.04% (LIBOR + 4.75%), maturity 12/29/28	Services: Business		134,211		-
Forefront, Senior Secured Delayed Draw Term Loan, 5.29% (SOFR + 4.25%), maturity 4/2/29	Healthcare & Pharmaceuticals		132,598		-
Service Logic, Senior Secured Delayed Draw Term Loan (First Lien), 6.29% (LIBOR + 4.00%), maturity 10/29/27	Services: Business		130,769		196,154
Community Brands, Senior Secured Delayed Draw Term Loan, 6.79% (SOFR + 5.75%), maturity 2/24/28	Banking, Finance, Insurance & Real Estate		117,647		-
Omni Logistics, Senior Secured Revolving Credit Loan (First Lien), 7.29% (LIBOR + 5.00%), maturity 12/30/25	Transportation: Cargo		113,834		85,376
Micro Merchant Systems, Senior Secured Revolving Loan, 8.04% (LIBOR + 5.75%), maturity 12/14/27	Healthcare & Pharmaceuticals		111,111		-
Tank Holding, Senior Secured Revolving Credit Loan, 7.04% (SOFR + 6.00%), maturity 3/31/28	Capital Equipment		110,769		-
Insight Global, Senior Secured Revolving Loan, 8.29% (LIBOR + 6.00%), maturity 9/22/27	Services: Business		110,697		67,089
Hissho Sushi, Senior Secured Revolving Credit Loan, 7.04% (SOFR + 6.00%), maturity 5/18/28	Beverage, Food and Tobacco		109,524		-
Therma Holdings, Senior Secured Initial DDTL (2021), 6.29% (LIBOR + 4.00%), maturity 12/16/27	Services: Business		90,276		-
FLS Transportation, Senior Secured Revolving Loan, 7.54% (LIBOR + 5.25%), maturity 12/17/27	Transportation: Cargo		88,889		-
Radwell, Senior Secured Revolving Loan, 6.79% (SOFR + 5.75%), maturity 4/1/28	Capital Equipment		79,998		-
Paradigm Oral Health, Senior Secured Revolving Loan, 5.79% (SOFR + 4.75%), maturity 7/9/26	Healthcare & Pharmaceuticals		74,074		-
Magnate, Senior Secured Delayed Draw Term Loan (First Lien), 7.79% (LIBOR + 5.50%), maturity 12/29/28	Transportation: Cargo		71,429		-
CPS, Senior Secured Revolving Credit Loan, 8.04% (LIBOR + 5.75%), maturity 5/27/28	Healthcare & Pharmaceuticals		71,414		-
Omni Logistics, Senior Secured Tranche 2 DDTL (First Lien), 7.29% (LIBOR + 5.00%), maturity 12/30/26	Transportation: Cargo		68,750		118,750
Community Brands, Senior Secured Revolving Loan, 6.79% (SOFR + 5.75%), maturity 2/24/28	Banking, Finance, Insurance & Real Estate		58,824		-
Applied Adhesives, Senior Secured Revolving Loan, 7.29% (LIBOR + 5.00%), maturity 3/12/27	Containers, Packaging and Glass		55,111		64,000
Tekni-Plex, Senior Secured Tranche B-3 DDTL Term Loan, 6.29% (LIBOR + 4.00%), maturity 9/15/28	Containers, Packaging and Glass		52,766		84,681
Keter Environmental Services, Unitranche, 8.79% (LIBOR + 6.50%), maturity 10/29/27	Environmental Industries		50,160		-
BlueHalo, Senior Secured Revolving Loan, 8.29% (LIBOR + 6.00%), maturity 10/31/25	Aerospace and Defense		44,770		73,967
Applied Adhesives, Senior Secured Delayed Draw Term Loan, 7.29% (LIBOR + 5.00%), maturity 3/12/27	Containers, Packaging and Glass		27,721		62,963
AmeriVet, Senior Secured Incremental Delayed Draw Term Loan, 7.04% (LIBOR + 4.75%), maturity 6/5/24	Healthcare & Pharmaceuticals		-		536,000
Alpaca, Senior Secured Revolver, 7.29% (LIBOR + 5.00%), maturity 4/19/24	Healthcare & Pharmaceuticals		-		129,426
Therma Holdings, Senior Secured Initial DDTL (2021), 6.04% (LIBOR + 3.75%), maturity 12/16/27	Services: Business		-		96,880
Gastro Health, Senior Secured Delayed Draw Term Loan (First Lien), 6.79% (LIBOR + 4.50%), maturity 7/3/28	Healthcare & Pharmaceuticals		-		94,975
Flow Control Group, Senior Secured Amendment No. 1 Delayed Draw Term Loan (First Lien), 6.04% (LIBOR + 3.75%), maturity 3/31/28	Capital Equipment		-		77,083
Alpaca, Senior Secured Delayed Draw Term A-2 Loan, 7.04% (LIBOR + 4.75%), maturity 4/19/24	Healthcare & Pharmaceuticals		-		66,723
ImageFirst, Senior Secured Delayed Draw Tranche A Term Loan, 6.79% (LIBOR + 4.50%), maturity 4/27/28	Healthcare & Pharmaceuticals		-		22,727
Solis Mammography, Senior Secured Delayed Draw Term Loan (First Lien), 7.04% (LIBOR + 4.75%), maturity 4/17/28	Healthcare & Pharmaceuticals		-		20,000
Capstone Logistics, Senior Secured Initial DDTL Loan (First Lien), 7.04% (LIBOR + 4.75%), maturity 11/12/27	Transportation: Cargo		-		221,132
InMark, Senior Secured Initial Delayed Draw Term Loan, 8.29% (LIBOR + 6.00%), maturity 12/23/26	Containers, Packaging and Glass		-		1,250,000
Brook & Whittle, Senior Secured Delayed Draw Term Loan (First Lien), 6.29% (LIBOR + 4.00%), maturity 12/14/28	Containers, Packaging and Glass		-		529,101
Ned Stevens, Senior Secured Revolving Loan, 7.54% (LIBOR + 5.25%), maturity 9/30/25	Services: Consumer		-		130,719
		$	22,322,233	$	13,913,615

Unfunded commitments represent all amounts unfunded as of June 30, 2022 and December 31, 2021. These amounts may or may not be funded to the borrowing party now or in the future.

34

Note 10. Financial Highlights

	Three Months Ended June 30, 2022			Three Months Ended June 30, 2021			Six Months Ended June 30, 2022			Six Months Ended June 30, 2021
Per Share Data:
Net asset value, beginning of period	$	9.43		$	9.44		$	9.36		$	9.31
Net investment income(a)		0.11			0.10			0.21			0.20
Net realized gain (loss) on investments and change in unrealized (depreciation) appreciation on investments(a)(b)		(0.07	)		0.01			(0.10	)		0.04
Net increase in net assets resulting from operations	$	0.04		$	0.11		$	0.11		$	0.24
Effect of equity capital activity
Distributions to stockholders from net investment income		(0.20	)		(0.20	)		(0.20	)		(0.20	)
Distributions to stockholders from return of capital(c)		-			0.00			-			0.00
Net asset value at end of period	$	9.27		$	9.35		$	9.27		$	9.35
Total return(d)(h)		0.39	%		1.15	%		1.14	%		2.56
Shares of common stock outstanding at end of period		43,696,759			39,009,533			43,696,759			39,009,533
Statement of Assets and Liabilities Data:
Net assets at end of period	$	405,152,390		$	364,579,526		$	405,152,390		$	364,579,526
Average net assets(e)		411,333,880			368,203,033			408,884,968			367,216,591
Ratio/Supplemental Data:
Ratio of gross expenses to average net assets-annualized(f)		2.29	%		1.56	%		2.04	%		1.61	%
Ratio of net expenses to average net assets-annualized(g)		1.28	%		1.10	%		1.16	%		1.06	%
Ratio of net investment income to average net assets-annualized		4.77	%		4.11	%		4.58	%		4.20	%
Portfolio turnover(h)		0.95	%		1.41	%		0.97	%		2.82	%

(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) For the three and six months ended June 30, 2021, the 0.00 is due to rounding.

(d) 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.

(e) Average net assets are computed using the average balance of net assets at the end of each month of the reporting period.

(f) Ratio of gross expenses to average net assets is computed using expenses before waivers from the Adviser and Administrator.

(g) Ratio of net expenses to average net assets is computed using total expenses net of waivers from the Adviser and Administrator.

(h) Not annualized.

Note 11. 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 12. Subsequent Events

Subsequent to June 30, 2022 through August 11, 2022, the Company invested $12,376,465 at cost in 16 different portfolio companies.

On June 22, 2022, the Company delivered a capital drawdown notice to an investor relating to the sale of 3,236,246 shares of the Common Stock for an aggregate offering price of $30.0 million. The sale closed on July 8, 2022. On July 14, 2022, the Company issued a Tender Offer to repurchase $15.0 million worth of Common Stock from the Stockholder. The Offer will expire on August 11, 2022.

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 (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.

35

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

In this quarterly report on Form 10-Q, except where the context suggests otherwise, the terms “we,” us,” our” and the “Company” refer to Audax Credit BDC Inc. The information contained in this section should be read in the conjunction with the financial statements and notes to the financial statements appearing elsewhere in this quarterly report.

This quarterly 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 25, 2022 (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 quarterly 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 entitled “Item 1A. Risk Factors” of this quarterly report and our Annual Report as well as risk factors described or identified 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 quarterly report. Moreover, we assume no duty and do not undertake to update the forward-looking statements. The forward-looking statements and projections contained in this quarterly report are excluded from the safe harbor protection provided by Section 27A of the Securities Act and provided by Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).

36

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 intends 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.

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.

COVID-19 and Related Developments

Market disruptions caused by the COVID-19 pandemic have adversely affected the business operations of some, if not all, of our portfolio companies and may continue to affect their operations, as well as and the operations of our Adviser. We cannot predict the ultimate full impact of COVID-19 on our business operations, the extent of the global economic recovery and the uncertainty surrounding the efficiency and success of the global vaccination efforts as more contagious strains of the virus emerge in various countries, including the United States. Such contagious variants, in conjunction with business re-openings, more frequent social gatherings, and decreasing public concern regarding COVID-19 have resulted in surges in the rates of COVID-19 infections in the United States and worldwide. Even if the prevalence of COVID-19 diminishes, lingering impacts such as supply chain disruptions and inflation are negatively affecting our portfolio companies and may lead to a decline in economic growth. We expect COVID-19 and/or other health pandemics and consequent supply chain disruptions to affect negatively our operating results and financial condition and the operating results and financial condition of our portfolio companies. We will continue to monitor developments relating to the COVID-19 pandemic and guidance from U.S. and international authorities, including federal, state and local public health officials and may take additional actions based on their recommendations.

37

PORTFOLIO COMPOSITION AND INVESTMENT ACTIVITY

Portfolio Composition

The fair value of our investments, comprised of syndicated loans and equity, as of June 30, 2022, was approximately $436,812,969 and held in 228 portfolio companies. The fair value of our investments, comprised of syndicated loans and equity, as of December 31, 2021, was approximately $403,054,374 and held in 215 portfolio companies as of December 31, 2021.

During the six months ended June 30, 2022, we invested in 66 new investments for a combined $67,368,883 and in existing investments for a combined $7,468,693. We also received $33,069,168 in repayments from investments and $4,047,932 from investments sold during the six months ended June 30, 2022. During the six months ended June 30, 2021, we invested in 43 new syndicated investments for a combined $48,768,159 and in existing investments for a combined $6,849,818. We also received $47,805,480 in repayments from investments and $10,135,008 from investments sold during the six months ended June 30, 2021.

In addition, for the three and six months ended June 30, 2022, we had a change in unrealized depreciation of approximately $3,105,203 and $4,671,366 respectively, and realized gains of $111,779 and $337,565, respectively. In addition, for the three and six months ended June 30, 2021, we had a change in unrealized appreciation of approximately $1,149,424 and $2,275,338 respectively, and realized losses of $696,642 and $633,372, respectively.

Our investment activity for the six months ended June 30, 2022 and 2021, is presented below:

	Six Months Ended June 30, 2022			Six Months Ended June 30, 2021
Beginning investment portfolio, at fair value	$	403,054,374		$	355,359,843
Investments in new portfolio investments		67,368,883			48,768,159
Investments in existing portfolio investments		7,468,693			6,849,818
Principal repayments		(33,069,168	)		(47,805,480	)
Proceeds from investments sold		(4,047,932	)		(10,135,008	)
Change in premiums, discounts and amortization		371,920			380,092
Net change in unrealized (depreciation) appreciation on investments		(4,671,366	)		2,275,338
Realized gain (loss) on investments		337,565			(633,372	)
Ending portfolio investment activity, at fair value	$	436,812,969		$	355,059,390
Number of portfolio investments		254			225
Average investment amount, at cost	$	1,743,002		$	1,584,067
Percentage of  investments at floating rates		100.00	%		100.00	%

As of June 30, 2022 and December 31, 2021, our entire portfolio consisted of non-controlled/non-affiliated investments.

RECENT DEVELOPMENTS

Subsequent to June 30, 2022 and through August 11, 2022, we invested $12,376,465 at cost in 16 portfolio companies.

On June 22, 2022, we delivered a capital drawdown notice to an investor relating to the sale of 3,236,246 shares of the Common Stock for an aggregate offering price of $30.0 million. The sale closed on July 8, 2022. On July 14, 2022, the Company issued a Tender Offer to repurchase $15.0 million worth of Common Stock. The Offer will expire on August 11, 2022.

38

The sale of Common Stock was made pursuant to a subscription agreement entered into by us 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. We have not engaged in general solicitation or advertising with regard to the issuance and sale of the Common Stock and have not offered securities to the public in connection with such issuance and sale.

RESULTS OF OPERATIONS

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. This “Results of Operations” section should be read in conjunction with the “COVID-19 Developments” section above.

Revenue

Total investment income for the three and six months ended June 30, 2022 and 2021 is presented in the table below.

	Three Months Ended June 30, 2022		Three Months Ended June 30, 2021		Six Months Ended June 30, 2022		Six Months Ended June 30, 2021
Total interest income from non-controlled/non-affiliated investments	$	6,062,310	$	4,762,471	$	11,452,128	$	9,531,156
Total other interest income		397		356		781		630
Total other income		140,256		15,488		178,374		63,002
Total investment income	$	6,202,963	$	4,778,315	$	11,631,283	$	9,594,788

Total investment income for the three months ended June 30, 2022 increased to $6,202,963 from $4,778,315 for the three months ended June 30, 2021, and was driven by the increase in LIBOR. Total investment income for the six months ended June 30, 2022 increased to $11,631,283 from $9,594,788 for the six months ended June 30, 2021, and was driven by an increase in LIBOR and from our increasing investment balance. As of June 30, 2022 and 2021, the size of our debt portfolio was $440,648,277 and $355,907,913 at amortized cost, respectively, with total debt principal amount outstanding of $444,868,471 and $358,274,679, respectively.

Expenses

Total expenses net of waivers for the three and six months ended June 30, 2022 and 2021, were as follows:

	Three Months Ended June 30, 2022			Three Months Ended June 30, 2021			Six Months Ended June 30, 2022			Six Months Ended June 30, 2021
Base management fee(a)	$	1,082,214		$	948,730		$	2,120,653		$	1,862,780
Incentive fee(a)		747,892			96,455			1,174,214			387,748
Administrative fee(a)		66,250			66,250			132,500			132,500
Directors’ fees		56,250			56,250			112,500			112,500
Professional fees		210,862			144,378			292,537			237,696
Other expenses		85,257			116,707			164,434			205,930
Interest expense		95,634			-			136,800			-
Total expenses		2,344,359			1,428,770			4,133,638			2,939,154
Base management fee waivers(a)		(378,775	)		(332,055	)		(742,229	)		(651,972	)
Incentive fee waivers(a)		(654,618	)		(86,809	)		(1,038,308	)		(348,973	)
Total expenses, net of waivers	$	1,310,966		$	1,009,906		$	2,353,101		$	1,938,209

(a) Refer to Note 4-Related Party Transactions within the financial statements for a description of the relevant fees.

39

The increase in base management fees before waivers for the three months ended June 30, 2022 in comparison to the three months ended June 30, 2021 was driven by our increasing invested balance. For the three months ended June 30, 2022 and 2021, we accrued gross base management fees before waivers of $1,082,214 and $948,730, respectively. Offsetting those fees, we recognized base management fee waivers of $378,775 and $332,055, respectively, for the same periods. The increase in incentive fees related to net investment income for the three months ended June 30, 2022 in comparison to the three months ended June 30, 2021 was driven by the increase in LIBOR which increased the yield of our variable rate debt investments. For the three months ended June 30, 2022, we accrued incentive fees related to net investment income before waivers of $747,892, offset by incentive fee waivers of $654,618. For the three months ended June 30, 2021, we accrued incentive fees related to net investment income before waivers of $96,455, offset by incentive fee waivers of $86,809. Additionally, we accrued $66,250 of administrative fees for each of the three months ended June 30, 2022 and 2021. Refer to Note 4 — Related Party Transactions in the notes accompanying our financial statements for more information related to base management fees, incentive fees and waivers.

During the three months ended June 30, 2022 and 2021, we incurred other expenses of $85,257 and $116,707, respectively, related to subscription fees, operating fees, custody fees, and other company expenses. We also incurred expenses related to fees paid to our independent directors of $56,250 for each of the three-month periods June 30, 2022 and 2021, respectively.

The increase in base management fees before waivers for the six months ended June 30, 2022 in comparison to the six months ended June 30, 2021 was driven by our increasing invested balance. For the six months ended June 30, 2022 and 2021, we accrued gross base management fees before waivers of $2,120,653 and $1,862,780, respectively. Offsetting those fees, we recognized base management fee waivers of $742,229 and $651,972, respectively. The increase in incentive fees related to net investment income for the six months ended June 30, 2022 in comparison to the six months ended June 30, 2021 was driven by our increasing invested balance and the increase in LIBOR, which increased the yield of our variable rate debt investments. For the six months ended June 30, 2022, we accrued incentive fees related to net investment income before waivers of $1,174,214, offset by incentive fee waivers of $1,038,308. For the six months ended June 30, 2021, we accrued incentive fees related to net investment income before waivers of $387,748, offset by incentive fee waivers of $348,973. Additionally, we accrued $132,500 of administrative fees for both the six months ended June 30, 2022 and 2021. Refer to Note 4 — Related Party Transactions in the notes accompanying our financial statements for more information related to base management fees, incentive fees and waivers.

During the six months ended June 30, 2022 and 2021, we incurred other expenses of $164,434 and $205,930, respectively, related to subscription fees, operating fees, custody fees, and other company expenses. We also incurred expenses related to fees paid to our independent directors of $112,500 for each of the six-month period ended June 30, 2022 and 2021.

Realized and Unrealized Gains and Losses

We recognized $111,779 and $(696,642) in net realized gains (losses) for the three months ended June 30, 2022 and 2021, respectively. We recognized $337,565 and $(633,372) in net realized gain (losses) for the six months ended June 30, 2022 and 2021, respectively.

Net change in unrealized appreciation (depreciation) on investments for the three and six months ended June 30, 2022 and 2021 was as follows:

Type	Three Months Ended June 30, 2022			Three Months Ended June 30, 2021		Six Months Ended June 30, 2022			Six Months Ended June 30, 2021
First Lien Debt	$	(3,238,517	)	$	478,044	$	(4,756,762	)	$	1,612,986
Second Lien Debt		66,559			385,035		15,629			418,045
Equity and Preferred Shares		66,756			286,345		69,768			244,307
Net change in unrealized (depreciation) appreciation on investments	$	(3,105,202	)	$	1,149,424	$	(4,671,365	)	$	2,275,338

40

Net change in unrealized depreciation on investments during the three and six months ended June 30, 2022 was primarily due to the change in the results and financial position of the portfolio companies. Net change in unrealized appreciation on investments during the three and six months ended June 30, 2021 was primarily due to the change in the results and financial position of the portfolio companies.

FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES

We generate cash primarily from the net proceeds of any offering of shares of our Common Stock, 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 June 30, 2022 and December 31, 2021, we had cash of $31,727,018 and $11,058,796, respectively. This “Financial Condition, Liquidity and Capital Resources” section should be read in conjunction with the “COVID-19 Developments” section above.

Operating Activities

Net cash used in operating activities for the six months ended June 30, 2022 was $41,486,759. The primary operating activities during this period were investments in portfolio companies. This was partially offset by repayments of bank loans. Net cash provided by operating activities for the six months ended June 30, 2021 was $17,706,055. The primary operating activities during this period were investments in portfolio companies. This was partially offset by repayments of bank loans.

As of June 30, 2022, we had 64 investments with unfunded commitments of $22,322,233. As of December 31, 2021, we had 36 investments with unfunded commitments of $13,913,615. We believe that, as of both June 30, 2022 and December 31, 2021, we had sufficient assets to adequately cover any obligations under our unfunded commitments.

The following table summarizes our total portfolio activity during the six months ended June 30, 2022 and 2021:

	Six Months Ended June 30, 2022			Six Months Ended June 30, 2021
Beginning investment portfolio	$	403,054,374		$	355,359,843
Investments in new portfolio investments		67,368,883			48,768,159
Investments in existing portfolio investments		7,468,693			6,849,818
Principal repayments		(33,069,168	)		(47,805,480	)
Proceeds from sales of investments		(4,047,932	)		(10,135,008	)
Net change in unrealized (depreciation) appreciation on investments		(4,671,366	)		2,275,338
Net realized gain (loss) on investments		337,565			(633,372	)
Net change in premiums, discounts and amortization		371,920			380,092
Investment Portfolio, at Fair Value	$	436,812,969		$	355,059,390

Financing Activities

Net cash provided by our financing activities for the six months ended June 30, 2022 was $62,154,981, which consisted of $55,000,000 from issuances of 3,735,351 Shares to our stockholders, in connection with our capital calls during the period and $35,894,306 in connection with our short-term borrowings during the period. This was partially offset by $20,000,000 in repurchases of shares to our stockholders, in connection to the tender offer during the period and $8,739,325 in distributions payable to stockholders. Net cash used in our financing activities for the six months ended June 30, 2021 was $1,601,880 which consisted of $7,801,880 of distributions paid to our common stockholders. This was partially offset by $6,200,000 received from issuances of 665,951 Shares to our stockholders, in connection with our capital calls during the period.

41

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	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 June 30, 2022, $55,000,000 of total capital commitments remained unfunded by our investors.

The number of shares of our Common Stock issued and outstanding as of June 30, 2022 and December 31, 2021, were 43,696,762 and 39,961,408, respectively.

Distributions to Stockholders – Common Stock Distributions

We have elected to be treated, and intends to comply with the requirements to qualify annually, 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.

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 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. We declared distributions of $8,739,352, or $0.200 per share during the three and six months ended June 30, 2022. We declared and paid distributions of $7,801,905, or $0.200 per share during the three and six months ended June 30, 2021.

42

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 be reported to stockholders subject to information reporting after the close of each calendar year on Form 1099-DIV.

Related Party Fees

For the three months ended June 30, 2022 and 2021, we recorded base management fees of $1,082,214 and $948,730, respectively. Offsetting these fees were waivers to the base management fees of $378,775 and $332,055, respectively, as set forth within the accompanying statements of operations.

For the six months ended June 30, 2022 and 2021, we recorded base management fees of $2,120,653 and $1,862,780, respectively. Offsetting those fees were waivers to the base management fees of $742,229 and $651,972, respectively, as set forth within the accompanying statements of operations.

For the three months ended June 30, 2022 and 2021, we recorded incentive fees of $747,892 and $96,455, respectively. Offsetting these fees were waivers to the incentive fees of $654,618 and $86,809, respectively, as set forth within the accompanying statements of operations.

For the six months ended June 30, 2022 and 2021, we recorded incentive fees of $1,174,214 and $387,748, respectively. Offsetting those fees were waivers to the incentive fees of $1,038,308 and $348,973, respectively, as set forth within the accompanying statements of operations.

For both the three months ended June 30, 2022 and 2021, we recorded administrative fees of $62,500, as set forth within the accompanying statements of operations. For both the six months ended June 30, 2022 and 2021, we recorded administrative fees of $132,500, as set forth within the accompanying statements of operations.

Fees due to related parties as of June 30, 2022 and December 31, 2021 on our accompanying statements of assets and liabilities were as follows:

	June 30, 2022		December 31, 2021
Net base management fee due to Adviser	$	703,439	$	620,269
Net incentive fee due to Adviser		93,274		20,060
Total fees due to Adviser, net of waivers		796,713		640,329
Fee due to Administrator, net of waivers		66,250		66,250
Total Related Party Fees Due	$	862,963	$	706,579

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 expired on May 19, 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.

43

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.

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.

44

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.

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.

45

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 new rule clarifies how fund boards can satisfy their valuation obligations in light of recent market developments. The rule will permit boards, subject to board oversight and certain other conditions, to designate certain parties to perform the fair value determinations. We will continue to review the adopted rule and its impact on us and our valuation policies.

Refer to Note 3 — Investments in 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.

46

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, 2021, 2020, and 2019.

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.

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

From time to time, we, the Adviser or the Administrator may become party to legal proceedings in the ordinary course of business, including proceedings related to the enforcement of our rights under contracts with our portfolio companies. Neither we, the Adviser nor the Administrator is currently subject to any material legal proceedings.

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 June 30, 2022, we had 64 investments with unfunded commitments of $22,322,233. As of December 31, 2021, we had 36 investments with unfunded commitments of $13,913,615. We believe that, as of June 30, 2022 and December 31, 2021, we had sufficient assets to adequately cover any obligations under our unfunded commitments.

47

ITEM 3. 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.

Debt investments that we make may be based on floating rates, such as SOFR (as defined below), LIBOR, the Euro Interbank Offered Rate, the Federal Funds Rate or the Prime Rate. General interest rate fluctuations may have a substantial negative impact on our investments, the value of our securities and our rate of return on invested capital. It is unclear how increased regulatory oversight and the future of LIBOR may affect market liquidity and the value of the financial obligations to be held by or issued to us that are linked to LIBOR, or how such changes could affect our investments and transactions and financial condition or results of operations. On March 5, 2021, the Financial Conduct Authority and ICE Benchmark Authority announced that the publication of all EUR and CHF LIBOR settings, the Spot Next/Overnight, 1 week, 2 month and 12 month JPY and GBP LIBOR settings, and the 1 week and 2 months US dollar LIBOR settings ceased to be published as of December 31, 2021, while the publication of the overnight, 1 month, 3 month, 6 month, and 12 months U.S. dollar (“USD”) LIBOR settings will cease after June 30, 2023. The Alternative Reference Rates Committee, a U.S.-based group convened by the Federal Reserve and the Federal Reserve Bank of New York, has identified the Secured Overnight Financing Rate (“SOFR”) as its preferred alternative rate for LIBOR. SOFR is a measure of the cost of borrowing cash overnight, collateralized by the U.S. Treasury securities, and is based on directly observable U.S. Treasury-backed repurchase transactions. We expect that a substantial portion of our future floating rate investments will be linked to SOFR.

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 LIBOR, could affect our gross investment income.

Change in interest rates	Increase (decrease) in investment income
Up 300 basis points		10,902,798
Up 200 basis points		6,454,113
Up 100 basis points		2,005,428
Down 100 basis points		(100,639	)
Down 200 basis points		(100,639	)
Down 300 basis points		(100,639	)

48

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.

ITEM 4. CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

As of the period covered by quarterly this 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.

49

PART II–OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

We are not currently subject to any material legal proceeding, nor, to our knowledge, is any material legal proceeding threatened against us.

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 1A. RISK FACTORS

In addition to the risks discussed below, important risk factors that could cause results or events to differ from current expectations are described in Part I, Item 1A “Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, 2021 filed with the SEC on March 25, 2022.

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 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. 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.

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 over the next year following the calendar quarter in which the approval was obtained. On April 22, 2022, the Company issued a Tender Offer to repurchase $20.0 million worth of Common Stock from the stockholders. The Offer expired on May 19, 2022.

Political, social and economic uncertainty, including uncertainty related to Russia’s military invasion of Ukraine, create and exacerbate risks.

Russia’s invasion of Ukraine in February 2022 and corresponding events have had, and could continue to have, severe adverse effects on regional and global economic markets. Following Russia’s actions, various governments, including the United States, have issued broad-ranging economic sanctions against Russia, including, among other actions, a prohibition on doing business with certain Russian companies, large financial institutions, officials and oligarchs; a commitment by certain countries and the European Union to remove selected Russian banks from the Society for Worldwide Interbank Financial Telecommunications, the electronic banking network that connects banks globally; and restrictive measures to prevent the Russian Central Bank from undermining the impact of the sanctions. The duration of hostilities and the vast array of sanctions and related events (including cyberattacks and espionage) cannot be predicted. Those events present material uncertainty and risk with respect to markets globally, which pose potential adverse risks to us and the performance of our investments and operations. Any such market disruptions could affect our portfolio companies’ operations and, as a result, could have a material adverse effect on our business, financial condition and results of operations.

50

Inflation and Supply Chain Risk

Economic activity has continued to accelerate across sectors and regions. Nevertheless, due to global supply chain issues, geopolitical events, a rise in energy prices and strong consumer demand as economies continue to reopen, inflation is showing signs of acceleration in the U.S. and globally. Inflation is likely to continue in the near to medium-term, particularly in the U.S., with the possibility that monetary policy may tighten in response. Persistent inflationary pressures could affect our portfolio companies profit margins.

51

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

Refer to our Current Report on Form 8-K filed on April 4, 2022 for issuances of our Common Stock during the quarter ended June 30, 2022. Such issuances were exempt from the registration requirements of the Securities Act pursuant to Section 4(a)(2) of the Securities Act and Regulation D thereunder.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

Not applicable.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

Not applicable.

ITEM 6. EXHIBITS

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).

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 Code of Ethics (Incorporated by reference to Exhibit 99.1 to Pre-Effective Amendment No. 1 to the Registration Statement on Form 10, File No. 000-55426, filed on June 5, 2015).

*       Filed herewith

52

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: August 11, 2022		By:	/s/ Michael P. McGonigle
			Michael P. McGonigle
			Chief Executive Officer

Date: August 11, 2022	By:	/s/ Richard T. Joseph
		Richard T. Joseph
		Chief Financial Officer

53