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Ares Capital (NASDAQ: ARCC) lifts SMBC facility to $1.6B with better pricing

Filing Impact
(Moderate)
Filing Sentiment
(Neutral)
Form Type
8-K

Rhea-AI Filing Summary

Ares Capital Corporation updated a key borrowing facility with Sumitomo Mitsui Banking Corporation and other lenders. The amendment increases total commitments under the SMBC Funding Facility from $1.1 billion to $1.6 billion, giving the company more committed debt capacity for its lending activities.

The pricing on the facility improves slightly, with the applicable spread reduced from 1.80% to 1.75% over SOFR, or from 0.80% to 0.75% over a defined base rate. The amendment also expands the accordion feature, allowing potential upsizing of the facility’s maximum size from $1.3 billion to $2.5 billion under certain conditions, while other terms remain materially unchanged.

Positive

  • Expanded committed funding: Commitments under the SMBC Funding Facility increase from $1.1 billion to $1.6 billion, providing significantly more committed borrowing capacity.
  • Improved pricing and scalability: The spread over SOFR and the base rate is reduced, and the accordion maximum rises from $1.3 billion to $2.5 billion, enhancing flexibility to upsize the facility if needed.

Negative

  • None.

Insights

ARCC secures larger, slightly cheaper credit capacity.

Ares Capital Corporation has amended its SMBC Funding Facility to increase lender commitments from $1.1 billion to $1.6 billion and slightly reduce spreads over SOFR and the base rate. This expands available committed funding while marginally lowering borrowing costs.

The accordion feature’s maximum size rises from $1.3 billion to $2.5 billion, giving the company more room to scale this facility if conditions are met. Borrowings remain subject to existing covenants and Investment Company Act leverage limits, so actual usage will depend on those constraints and portfolio demand.

Investors may focus on how this additional committed capacity and modestly better pricing support future asset growth and refinancing flexibility within the SMBC Funding Facility framework, particularly as subsequent reports detail utilization levels and any future exercise of the expanded accordion feature.

Item 1.01 Entry into a Material Definitive Agreement Business
The company signed a significant contract such as a merger agreement, credit facility, or major partnership.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement Financial
The company incurred a new significant debt or off-balance-sheet obligation.
Item 9.01 Financial Statements and Exhibits Exhibits
Financial statements, pro forma financial information, or exhibit attachments filed with this report.

FAQ

What did Ares Capital Corporation (ARCC) change in its SMBC Funding Facility?
Ares Capital amended its SMBC Funding Facility to increase lender commitments to $1.6 billion, modestly reduce interest spreads, and expand the accordion feature’s maximum size to $2.5 billion, while keeping other key terms materially unchanged.

How much did ARCC increase commitments under the SMBC Funding Facility?
Commitments under the SMBC Funding Facility were increased from $1.1 billion to $1.6 billion. This larger commitment provides additional secured borrowing capacity for Ares Capital’s subsidiary, potentially supporting more investment activity within its regulatory leverage limits.

Did Ares Capital Corporation (ARCC) change interest rates on the SMBC Funding Facility?
Yes. The applicable spread over SOFR decreased from 1.80% to 1.75%, and the spread over the base rate decreased from 0.80% to 0.75%, slightly lowering borrowing costs under the facility for Ares Capital’s subsidiary.

What is the new maximum size of ARCC’s accordion feature in the SMBC Funding Facility?
The accordion feature’s maximum potential size increased from $1.3 billion to $2.5 billion. Under certain circumstances, this lets Ares Capital’s subsidiary seek a much larger overall facility if lender and contractual conditions are satisfied.

Does the SMBC Funding Facility amendment affect ARCC’s covenants or leverage limits?
The company states that other terms of the SMBC Funding Facility remain materially unchanged. Borrowings under the facility continue to be subject to existing covenants and leverage restrictions under the Investment Company Act of 1940.

Which Ares Capital entities are parties to the amended SMBC Funding Facility?
Ares Capital JB Funding LLC, a wholly owned subsidiary, is the borrower, and Ares Capital Corporation acts as servicer and transferor. Sumitomo Mitsui Banking Corporation serves as administrative agent, lender, and collateral agent, alongside other named lenders.

AI-generated analysis. How Rhea-AI works. Not financial advice.

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Understanding 8-K Material Events →
0001287750FALSE00012877502026-02-252026-02-25

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549 
_____________________________________________________________________  
FORM 8-K
 
CURRENT REPORT
 
Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934
 
Date of report (Date of earliest event reported) February 25, 2026
 
ARES CAPITAL CORPORATION
(Exact Name of Registrant as Specified in Charter)
 
Maryland 814-00663 33-1089684
(State or Other Jurisdiction
of Incorporation)		 (Commission
File Number)		 (IRS Employer
Identification No.)
 
245 Park Avenue, 44th Floor, New York, NY
 10167
(Address of Principal Executive Offices) (Zip Code)
 
Registrant’s telephone number, including area code (212) 750-7300
 
(Former Name or Former Address, if Changed Since Last Report)
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
 
o  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
o  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
o  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
o  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading symbolName of each exchange on which registered
Common stock, $0.001 par valueARCCNASDAQ Global Select Market

Indicate by check mark whether the registrant is an emerging growth company as defined in as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
Emerging growth company o

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. o


Item 1.01 Entry into a Material Definitive Agreement.

On February 25, 2026, Ares Capital Corporation (the “Registrant”) and Ares Capital JB Funding LLC, a wholly owned subsidiary of the Registrant (“ACJB LLC”), entered into Amendment No. 13 (the “SMBC Funding Facility Amendment”) to amend the Loan and Servicing Agreement, dated as of January 20, 2012, as amended (the “SMBC Funding Facility”), with Sumitomo Mitsui Banking Corporation and each of the other parties thereto. The SMBC Funding Facility Amendment, among other things, (a) increased the commitments under the SMBC Funding Facility from $1.1 billion to $1.6 billion; (b) adjusted the interest rate charged on the SMBC Funding Facility from an applicable spread of either (i) 1.80% over SOFR or (ii) 0.80% over a “base rate” (as defined in the documents governing the SMBC Funding Facility) to an applicable spread of either (x) 1.75% over SOFR or (y) 0.75% over a “base rate” (as defined in the documents governing the SMBC Funding Facility) and (c) increased the “accordion” feature that allows ACJB LLC, under certain circumstances, to increase the overall size of the SMBC Funding Facility from a maximum of $1.3 billion to a maximum of $2.5 billion. The other terms of the SMBC Funding Facility remained materially unchanged.

Borrowings under the SMBC Funding Facility are subject to the SMBC Funding Facility’s various covenants and the leverage restrictions contained in the Investment Company Act of 1940, as amended.

The description above is only a summary of the material provisions of the SMBC Funding Facility Amendment and is qualified in its entirety by reference to a copy of the SMBC Funding Facility Amendment, which is filed as Exhibit 10.1 to this current report on Form 8-K and incorporated by reference herein.

Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of Registrant.
 
The information contained in Item 1.01 to this current report on Form 8-K is by this reference incorporated in this Item 2.03.
 
Item 9.01 Financial Statements and Exhibits.
 
(d)                               Exhibits:
 
Exhibit Number Description
   
10.1
 Amendment No. 13, dated as of February 25, 2026, among Ares Capital JB Funding LLC, as borrower, Ares Capital Corporation, as servicer and transferor, Sumitomo Mitsui Banking Corporation, as administrative agent, lender and collateral agent, Citizens Bank, N.A., as lender, and Sumitomo Mitsui Trust Bank, Limited, New York Branch, as lender (amending the Loan and Servicing Agreement, dated as of January 20, 2012).
104Cover Page Interactive Data File (embedded within the Inline XBRL document)


SIGNATURE
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
 
  ARES CAPITAL CORPORATION
   
Date: February 27, 2026  
   
 By:/s/ SCOTT C. LEM
 Name:Scott C. Lem
 Title:Chief Financial Officer and Treasurer


Source: View Original Filing on SEC EDGAR

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