Barings BDC Announces Early Termination of Credit Support Agreement

Barings BDC announced the early termination of its existing credit support agreement associated with the Company's acquisition of Sierra Income Corporation, and the implementation of a new credit support agreement covering the remaining investments in two Sierra legacy portfolio companies. The original CSA, entered into on February 25, 2022 in connection with the Sierra merger, provided up to $100M of credit protection to Barings BDC shareholders against losses on the investments acquired by Barings BDC in the Sierra merger. Under the terms of the termination and cancellation agreement executed May 29, 2026, Barings, the Company's investment advisor, will make a cash payment of $67M to Barings BDC with respect to investments covered by the CSA that have been realized, have a fair value of $500,000 or less, or are in an unrealized loss position, in each case, as of the execution date. All unrealized investments covered by the CSA are currently in an unrealized loss position. The cash payment will be made on or before June 30, 2026. This cash payment fully satisfies the credit support obligation for those investments and results in the termination and extinguishment of the original CSA. Concurrently, Barings BDC and Barings entered into a new, more targeted credit support agreement, which provides continued downside protection for the remaining investments in two Sierra legacy portfolio companies that have not yet been realized in an amount equal to the fair value of such investments as of the execution date .