UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2023 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number: 000-56126 Palmer Square Capital BDC Inc. (Exact name of registrant as specified in its charter) | Maryland | 84-3665200 | | --- | --- | | (State or other jurisdiction of | (I. ...

Investment Portfolio - As of June 30, 2023, the company had 208 debt and equity investments in 177 portfolio companies with an aggregate fair value of approximately $966.0 million[173]. - The total investments at fair value as of June 30, 2023, were $1.06 billion, up from $1.02 billion as of December 31, 2022[177]. - The investment portfolio at fair value decreased from $966.9 million at the end of 2022 to $966.0 million by June 30, 2023[183]. - The company values investments based on market quotations or fair value determined by the Investment Advisor, which may involve subjective judgments[221]. Financial Performance - Total investment income for Q2 2023 was $27.44 million, up from $16.50 million in Q2 2022, representing a 66.6% increase[181]. - Net investment income for the first half of 2023 was $27.79 million, compared to $18.22 million in the same period of 2022, reflecting a 52.5% increase[181]. - The weighted average total yield to maturity of debt and income-producing securities at fair value was 11.40% as of June 30, 2023, compared to 11.47% as of December 31, 2022[172]. - The weighted average interest rate of debt and income-producing securities increased to 9.82% in Q2 2023 from 8.83% in Q2 2022[179]. - Net expenses for Q2 2023 were $13.24 million, significantly higher than $6.95 million in Q2 2022, marking an increase of 90.5%[184]. Investment Activities - For the three months ended June 30, 2023, the company made gross investments of $46.67 million, while total new investments amounted to $12.86 million after accounting for sold investments[175]. - The principal amount of first-lien senior secured debt investments funded was $46.67 million for the three months ended June 30, 2023[175]. - The company reported total principal amount of investments sold or repaid at $33.82 million for the three months ended June 30, 2023[175]. - The average new investment commitment amount in Q2 2023 was $4.12 million, compared to $3.27 million in Q2 2022, indicating a 25.9% increase[177]. Cash and Liquidity - As of June 30, 2023, the company had cash and cash equivalents of $6.7 million, a significant increase from $99 thousand as of June 30, 2022[193]. - During the six months ended June 30, 2023, net cash provided by operating activities was $18.0 million, primarily due to proceeds from the sale of investments totaling $136.0 million[191]. - The company experienced a net increase in cash and cash equivalents of $5.1 million during the six months ended June 30, 2023[191]. Debt and Financing - As of June 30, 2023, the principal outstanding under the BoA Credit Facility was $490.0 million, down from $541.5 million as of June 30, 2022[193]. - The asset coverage ratio as of June 30, 2023, was 168%, exceeding the required minimum of 150%[195]. - The company has a total contractual obligation of $627.4 million, with $491.6 million due under the BoA Credit Facility and $135.7 million under the WF Credit Facility[227]. - The company has two unfunded commitments totaling $1.5 million as of June 30, 2023, which may expire without being drawn upon[228]. Risk Management - The company is subject to financial market risks, including changes in interest rates, which may materially affect its net investment income[230]. - A hypothetical increase of 100 basis points in interest rates would result in an increase of $10.3 million in net investment income[233]. - A hypothetical increase of 200 basis points in interest rates would lead to an increase of $20.4 million in net investment income[233]. - A hypothetical increase of 300 basis points in interest rates would result in an increase of $30.3 million in net investment income[233]. - A decrease of 25 basis points in interest rates would result in a decrease of $2.58 million in net investment income[233]. - The company measures exposure to interest rate and currency exchange rate fluctuations on an ongoing basis[235]. - The company may hedge against interest rate and currency exchange rate fluctuations using standard hedging instruments[235]. - Risks associated with foreign currency investments include significant fluctuations in foreign currency markets and potential illiquidity[234]. Management and Governance - The company is externally managed by an investment advisor registered with the SEC, which oversees day-to-day operations and investment management[167]. - The company has elected to be regulated as a business development company (BDC) and as a regulated investment company (RIC) under the Internal Revenue Code[166]. - The Investment Advisor has agreed to waive its right to receive management fees in excess of 1.75% of total net assets prior to a Listing[225]. Dividend Policy - The company intends to distribute dividends at least equal to 90% of its net ordinary income and net short-term capital gains to maintain RIC tax treatment[211]. - The company has adopted a dividend reinvestment plan that allows stockholders to reinvest dividends in additional shares unless they opt to receive cash[214]. - The company intends to distribute net capital gains at least annually, but may retain such gains for investment purposes[213].

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number: 000-56126 Palmer Square Capital BDC Inc. (Exact name of registrant as specified in its charter) | Maryland | 84-3665200 | | --- | --- | | (State or other jurisdiction of | (I.R.S. Employer | | incorporation or organization) | Identification No.) | | 1900 Shawnee Mission Parkway, Suite 315, | | | Mission Woods, KS | 66205 | ...

Investment Portfolio - As of December 31, 2022, the company had 204 debt and equity investments in 176 portfolio companies with an aggregate fair value of approximately $966.9 million[328]. - As of December 31, 2022, total investments amounted to $1.12 billion at amortized cost, with a fair value of $1.02 billion[334]. - The investment portfolio at fair value decreased from $1.1 billion as of December 31, 2021, to $966.9 million as of December 31, 2022, a decline of 11.9%[340]. - The net change in unrealized losses on investments for 2022 was $(107.4) million, compared to $(8.5) million in 2021, indicating a significant deterioration in portfolio value[346]. - The company expects to value many of its portfolio investments at fair value, which may differ significantly from values that would have been used if readily available market quotations existed[378]. - The company engages independent valuation providers to review the valuation of each portfolio investment that constitutes a material portion of its portfolio at least once annually[377]. Investment Performance - Total investment income for the year ended December 31, 2022, was $74.5 million, a significant increase from $39.7 million in 2021, representing an 87.7% growth[337]. - Net investment income for 2022 was $41.1 million, compared to $22.8 million in 2021, reflecting an increase of 80.0%[337]. - The weighted average total yield to maturity of debt and income-producing securities at fair value was 11.47% as of December 31, 2022, compared to 5.77% as of December 31, 2021[327][328]. - The weighted average total yield of debt and income-producing securities rose to 11.47% in 2022 from 5.77% in 2021[336]. Investment Strategy - The company aims to maximize total return through current income and capital appreciation, focusing on corporate debt securities and CLO structured credit[324]. - The company expects to continue evaluating other investment strategies without a specific allocation to any single strategy[324]. Debt and Financing - The principal amount of first-lien senior secured debt investments funded in 2022 was $247.23 million, down from $829.59 million in 2021[332]. - Average debt outstanding increased from $477.0 million in 2021 to $667.5 million in 2022, an increase of 40.0%[342]. - As of December 31, 2022, the principal outstanding under the Bank of America Credit Facility was approximately $514.5 million, with $210.5 million of available commitments[358]. - Under the Wells Fargo Credit Facility, as of December 31, 2022, approximately $126.8 million was outstanding, with $23.2 million of available commitments[363]. - The Bank of America Credit Facility's commitment amount increased from $200 million to $725 million over various dates, with the ability to draw scheduled to terminate on February 11, 2025[355]. - The Wells Fargo Credit Facility has a facility amount of $150 million, with the ability to draw scheduled to terminate on December 18, 2023[360]. - The interest rates for loans under the Bank of America Credit Facility are base rate plus 1.30% or LIBOR plus 1.30%[356]. - The interest rates for loans under the Wells Fargo Credit Facility are LIBOR or base rate plus 1.85% for Broadly Syndicated Loans and plus 2.35% for Middle Market Loans[361]. Expenses and Obligations - Net expenses for 2022 were $33.4 million, up from $16.9 million in 2021, marking a 97.5% increase[341]. - The company has significant contractual obligations totaling $641,309,417, with $513,726,164 due in the 1-3 year period and $127,583,253 in the 3-5 year period[383]. - As of December 31, 2022, the company had two unfunded commitments totaling $2.6 million, compared to nine unfunded commitments totaling $11.3 million as of December 31, 2021[384]. Dividends and Shareholder Returns - The company intends to distribute quarterly dividends to stockholders, with a goal to distribute at least 90% of net ordinary income and net short-term capital gains to maintain RIC tax treatment[365]. - The company has adopted a dividend reinvestment plan, allowing stockholders to reinvest dividends in additional shares unless they opt for cash[369]. Management and Governance - The company is externally managed by an Investment Advisor, which is a majority-owned subsidiary of Palmer Square, specializing in global alternative investments[323]. - The Board has designated the Investment Advisor to serve as the valuation designee for determining fair value of portfolio investments effective August 11, 2022[376]. - The company has a registered investment adviser that is majority-owned by Palmer Square, with related party transactions involving board members[381]. Risk Management - Interest rate sensitivity indicates that a 100 basis point increase in interest rates could result in an increase of $10,526,946 in net investment income[388]. - The company anticipates that changes in interest rates could have a material adverse effect on net investment income due to its reliance on borrowings[386]. - The company may hedge against interest rate and currency exchange rate fluctuations using standard hedging instruments[390]. - The company has entered into an Advisory Agreement with an annual base management fee of 2.0% of the average value of total net assets[382].

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2022 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number: 000-56126 Palmer Square Capital BDC Inc. (Exact name of registrant as specified in its charter) | Maryland | 84-3665200 | | --- | --- | | (State or other jurisdiction of | (I. ...

[Filing Information](index=1&type=section&id=Filing%20Information) Key administrative details of the quarterly report, including company classification and outstanding shares - The document is a Quarterly Report on Form 10-Q for Palmer Square Capital BDC Inc. for the quarterly period ended June 30, 2022[2](index=2&type=chunk)[3](index=3&type=chunk) - The registrant is classified as a **non-accelerated filer** and an **emerging growth company**[5](index=5&type=chunk) - As of August 12, 2022, the registrant had **23,062,349 shares of common stock outstanding**[5](index=5&type=chunk) [Table of Contents](index=2&type=section&id=Table%20of%20Contents) Outlines the report's structure, detailing financial information and other disclosures within each part - The report is structured into two main parts: PART I. FINANCIAL INFORMATION and PART II. OTHER INFORMATION[7](index=7&type=chunk) - PART I includes Consolidated Financial Statements (Statements of Assets and Liabilities, Operations, Changes in Net Assets, Cash Flows, Schedules of Investments, and Notes), Management's Discussion and Analysis, Market Risk Disclosures, and Controls and Procedures[7](index=7&type=chunk) - PART II covers Legal Proceedings, Risk Factors, Unregistered Sales of Equity Securities, Defaults Upon Senior Securities, Mine Safety Disclosures, Other Information, and Exhibits[7](index=7&type=chunk) [PART I. FINANCIAL INFORMATION](index=3&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) Presents comprehensive financial data, including statements, management's analysis, market risk, and controls [Item 1. Consolidated Financial Statements (Unaudited)](index=3&type=section&id=Item%201.%20Consolidated%20Financial%20Statements%20(Unaudited)) Presents unaudited consolidated financial statements, including assets, operations, cash flows, and investment schedules [Consolidated Statements of Assets and Liabilities](index=3&type=section&id=Consolidated%20Statements%20of%20Assets%20and%20Liabilities) Total assets and net assets decreased significantly, primarily due to lower non-controlled investments | Metric | June 30, 2022 | December 31, 2021 | Change | | :----------------------------------- | :-------------- | :---------------- | :----- | | Non-controlled, non-affiliated investments, at fair value | $1,072,518,293 | $1,194,257,584 | -$121,739,291 | | Cash and cash equivalents | $99,026 | $1,093,503 | -$994,477 | | Total Assets | $1,094,803,841 | $1,217,286,149 | -$122,482,308 | | Credit facility, net | $668,320,091 | $649,910,497 | +$18,409,594 | | Total Liabilities | $709,370,508 | $764,488,561 | -$55,118,053 | | Total Net Assets | $385,433,333 | $452,797,588 | -$67,364,255 | | Net Asset Value Per Common Share | $16.71 | $20.06 | -$3.35 | [Consolidated Statements of Operations](index=4&type=section&id=Consolidated%20Statements%20of%20Operations) Net assets from operations decreased significantly due to unrealized losses, despite increased investment income | Metric | 3 Months Ended Jun 30, 2022 | 3 Months Ended Jun 30, 2021 | 6 Months Ended Jun 30, 2022 | 6 Months Ended Jun 30, 2021 | | :------------------------------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Total Investment Income | $16,497,241 | $7,869,228 | $30,752,200 | $17,544,103 | | Total Expenses | $7,222,437 | $3,841,350 | $13,089,071 | $7,639,260 | | Net Investment Income (Loss) | $9,549,533 | $4,196,204 | $18,220,103 | $10,233,952 | | Net realized gains (losses) | $(486,754) | $2,712,837 | $(856,624) | $3,845,495 | | Net change in unrealized gains (losses) | $(74,394,896) | $(1,871,880) | $(86,126,397) | $(3,698,294) | | Net Increase (Decrease) in Net Assets from Operations | $(65,332,117) | $5,037,161 | $(68,762,918) | $10,381,153 | | Basic and diluted net investment income per common share | $0.42 | $0.32 | $0.80 | $0.79 | | Basic and diluted net increase (decrease) in net assets from operations | $(2.85) | $0.38 | $(3.01) | $0.80 | [Consolidated Statements of Changes in Net Assets](index=5&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Net%20Assets) Net assets decreased significantly due to unrealized losses and stockholder distributions | Metric | 3 Months Ended Jun 30, 2022 | 3 Months Ended Jun 30, 2021 | 6 Months Ended Jun 30, 2022 | 6 Months Ended Jun 30, 2021 | | :------------------------------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Net investment income (loss) | $9,549,533 | $4,196,204 | $18,220,103 | $10,233,952 | | Net realized gains (losses) on investments | $(486,754) | $2,712,837 | $(856,624) | $3,845,495 | | Net change in unrealized gains (losses) on investments | $(74,394,896) | $(1,871,880) | $(86,126,397) | $(3,698,294) | | Net Increase (Decrease) in Net Assets from Operations | $(65,332,117) | $5,037,161 | $(68,762,918) | $10,381,153 | | Dividends and distributions to stockholders | $(8,439,969) | $(4,067,209) | $(8,439,969) | $(4,067,209) | | Issuance of common shares | - | $6,293,374 | $4,823,801 | $8,321,074 | | Reinvestment of distributions | $5,014,831 | $2,362,492 | $5,014,831 | $4,644,713 | | Net Assets, End of Period | $385,433,333 | $272,424,702 | $385,433,333 | $272,424,702 | [Consolidated Statements of Cash Flows](index=6&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Net cash and cash equivalents decreased due to operating activities and portfolio purchases | Metric | 6 Months Ended Jun 30, 2022 | 6 Months Ended Jun 30, 2021 | | :------------------------------------------------- | :-------------------------- | :-------------------------- | | Net increase (decrease) in net assets from operations | $(68,762,918) | $10,381,153 | | Purchases of portfolio investments | $(221,385,705) | $(277,427,052) | | Proceeds from sale of portfolio investments | $204,224,871 | $224,133,758 | | Net cash used in operating activities | $(14,018,459) | $(25,063,996) | | Borrowings on the credit facility | $84,500,000 | $20,395,666 | | Payments on the credit facility | $(67,000,000) | - | | Distributions paid in cash | $(9,299,819) | $(3,316,966) | | Proceeds from issuance of common shares | $4,823,801 | $8,321,074 | | Net cash provided by financing activities | $13,023,982 | $25,399,774 | | Net increase (decrease) in cash and cash equivalents | $(994,477) | $335,778 | | Cash and cash equivalents, end of period | $99,026 | $1,018,357 | [Consolidated Schedules of Investments](index=7&type=section&id=Consolidated%20Schedules%20of%20Investments) Investment portfolio primarily comprised First Lien Senior Secured Debt, totaling $1.07 billion across 227 investments Investment Portfolio Composition (Fair Value) | Investment Type | June 30, 2022 (Fair Value) | Percentage of Total Investments (June 30, 2022) | December 31, 2021 (Fair Value) | Percentage of Total Investments (Dec 31, 2021) | | :-------------------------- | :--------------------------- | :---------------------------------------------- | :--------------------------- | :---------------------------------------------- | | First-lien senior secured debt | $932,605,888 | 86.95% | $1,007,407,474 | 84.35% | | Second-lien senior secured debt | $67,477,047 | 6.29% | $64,658,512 | 5.41% | | Corporate Bonds | $1,700,500 | 0.16% | $2,947,571 | 0.25% | | Convertible Bond | $3,627,490 | 0.34% | $942,069 | 0.08% | | CLO Mezzanine | $15,042,935 | 1.40% | $19,105,394 | 1.60% | | CLO Equity | $25,526,674 | 2.38% | $20,253,800 | 1.70% | | Equity | $560,000 | 0.05% | $800,000 | 0.07% | | Short-term investments | $25,977,759 | 2.42% | $78,142,764 | 6.54% | | **Total Investments** | **$1,072,518,293** | **100.00%** | **$1,194,257,584** | **100.00%** | Industry Composition of Investments (Fair Value) | Industry | June 30, 2022 | December 31, 2021 | | :------------------------------------------ | :------------ | :---------------- | | Software | 13.0% | 10.2% | | Healthcare Providers and Services | 10.4% | 10.8% | | IT Services | 8.7% | 9.4% | | Insurance | 5.9% | 5.7% | | Professional Services | 5.9% | 6.4% | | Hotels, Restaurants and Leisure | 3.6% | 3.5% | | Media | 3.6% | 3.9% | | Building Products | 3.4% | 3.0% | | Chemicals | 2.8% | 2.2% | | Independent Power and Renewable Electricity Producers | 2.5% | 3.1% | | Cash and cash equivalents | 2.4% | 6.5% | | Aerospace and Defense | 2.4% | 0.9% | | Construction and Engineering | 2.4% | 1.7% | | Structured Subordinated Note | 2.4% | 1.7% | | Containers and Packaging | 2.3% | 1.8% | | Oil, Gas and Consumable Fuels | 2.3% | 3.0% | | Diversified Financial Services | 2.3% | 1.8% | | Healthcare Technology | 1.9% | 2.1% | | Metals and Mining | 1.9% | 1.5% | | Auto Components | 1.8% | 1.5% | | Diversified Telecommunication Services | 1.4% | 1.4% | | Structured Note | 1.4% | 1.6% | | Internet Software and Services | 1.3% | 1.3% | | Food Products | 1.2% | 1.1% | | Healthcare Equipment and Supplies | 1.2% | 2.0% | | Electronic Equipment, Instruments and Components | 1.2% | 1.1% | | Specialty Retail | 1.2% | 1.2% | | Commercial Services and Supplies | 1.1% | 1.5% | | Airlines | 1.0% | 1.3% | | Diversified Consumer Services | 0.9% | 0.8% | | Industrial Conglomerates | 0.8% | 0.8% | | Electrical Equipment | 0.8% | 0.6% | | Road and Rail | 0.6% | 0.6% | | Real Estate Management and Development | 0.6% | 0.6% | | Machinery | 0.6% | 0.3% | | Wireless Telecommunication Services | 0.6% | 0.6% | | Pharmaceuticals | 0.6% | 0.8% | | Technology Hardware, Storage and Peripherals | 0.4% | 0.5% | | Household Durables | 0.4% | 0.4% | | Energy Equipment and Services | 0.4% | -% | | Electric Utilities | 0.3% | 0.3% | | Textiles, Apparel and Luxury Goods | 0.1% | 0.1% | | Leisure Products | -% | 0.4% | | **Total** | **100.0%** | **100.0%** | - As of June 30, 2022, the Company held 227 debt and equity investments in 191 portfolio companies, a decrease from 240 investments in 212 companies as of December 31, 2021[187](index=187&type=chunk)[188](index=188&type=chunk) - The weighted average total yield to maturity of debt and income producing securities at fair value increased significantly to **10.07%** as of June 30, 2022, from **5.77%** as of December 31, 2021[186](index=186&type=chunk)[196](index=196&type=chunk) [Notes to Consolidated Financial Statements (Unaudited)](index=40&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements%20(Unaudited)) Details BDC/RIC structure, investment objectives, accounting policies, advisor agreements, debt, and commitments - The Company is structured as an externally managed, non-diversified closed-end management investment company, regulated as a BDC and elected to be treated as a RIC[79](index=79&type=chunk)[181](index=181&type=chunk) - Investment objective is to maximize total return (current income and capital appreciation) by investing in corporate debt securities and CLO structured credit funds[80](index=80&type=chunk)[183](index=183&type=chunk) - The Investment Advisor has agreed to waive management fees in excess of **1.75% of total net assets** until the Company's common stock is listed on a national securities exchange[111](index=111&type=chunk)[244](index=244&type=chunk) Debt Obligations (Net Carrying Value) | Credit Facility | June 30, 2022 | December 31, 2021 | | :-------------------- | :-------------- | :---------------- | | BoA Credit Facility | $540,817,207 | $550,262,297 | | WF Credit Facility | $127,502,884 | $99,648,200 | | **Total Debt** | **$668,320,091** | **$649,910,497** | - As of June 30, 2022, the Company had **$6.3 million in unfunded commitments** to portfolio companies, a decrease from **$11.3 million as of December 31, 2021**[165](index=165&type=chunk)[167](index=167&type=chunk)[246](index=246&type=chunk) - The Company's asset coverage ratio was **158%** as of June 30, 2022, meeting the 1940 Act requirement of at least **150%**[135](index=135&type=chunk)[212](index=212&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=58&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses financial performance, decreased net assets, portfolio activity, liquidity, and financing - Total investment income increased for both the three and six months ended June 30, 2022, compared to the prior year, primarily driven by interest income from investments[198](index=198&type=chunk)[200](index=200&type=chunk) - Net expenses increased for the six months ended June 30, 2022, primarily due to increased leverage and management fees[203](index=203&type=chunk) Investment Activity (6 Months Ended June 30) | Metric | 2022 | 2021 | | :------------------------------------------ | :----------- | :----------- | | Gross investments | $221,385,705 | $277,427,052 | | Sold investments | $204,224,871 | $224,133,758 | | Total new investments (net) | $17,160,834 | $53,293,294 | | Number of new investment commitments | 37 | 80 | | Weighted average interest rate of new investment commitments | 6.02% | 4.57% | | Percentage of new debt investment commitments at floating rates | 96.71% | 99.62% | - The Company experienced a net decrease in cash and cash equivalents of **$994 thousand** for the six months ended June 30, 2022, compared to a net increase of **$336 thousand** in the prior year[208](index=208&type=chunk)[209](index=209&type=chunk) - As of June 30, 2022, the Company had **$541.5 million** outstanding under the BoA Credit Facility and **$128.0 million** outstanding under the WF Credit Facility, with available commitments of **$183.5 million** and **$22.0 million**, respectively[218](index=218&type=chunk)[224](index=224&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=74&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) Discusses market risks, primarily interest rate sensitivity impacting net investment income and foreign currency risks Annualized Impact of Hypothetical Base Rate Changes on Net Investment Income (as of June 30, 2022) | Change in Interest Rates | Increase (Decrease) in Interest Income | Increase (Decrease) in Interest Expense | Net Increase (Decrease) in Net Investment Income | | :----------------------- | :------------------------------------- | :-------------------------------------- | :----------------------------------------------- | | Down 25 basis points | $(2,739,919) | $(1,673,750) | $(1,066,169) | | Up 100 basis points | $11,001,658 | $6,695,000 | $4,306,658 | | Up 200 basis points | $21,861,188 | $13,390,000 | $8,471,188 | | Up 300 basis points | $32,574,273 | $20,085,000 | $12,489,273 | - The Company is subject to risks associated with changes in currency exchange rates for investments denominated in foreign currency and may use hedging instruments to mitigate these risks[252](index=252&type=chunk)[253](index=253&type=chunk) [Item 4. Controls and Procedures](index=75&type=section&id=Item%204.%20Controls%20and%20Procedures) Management confirmed effective disclosure controls and no material changes in internal control during the quarter - Disclosure controls and procedures were effective at a reasonable assurance level as of June 30, 2022[254](index=254&type=chunk) - No material changes in internal control over financial reporting occurred during the quarter ended June 30, 2022[255](index=255&type=chunk) [PART II. OTHER INFORMATION](index=76&type=section&id=PART%20II.%20OTHER%20INFORMATION) Presents other required disclosures, including legal proceedings, risk factors, equity sales, defaults, and exhibits [Item 1. Legal Proceedings](index=76&type=section&id=Item%201.%20Legal%20Proceedings) No material legal proceedings are currently pending or threatened against the Company - No material legal proceedings are currently pending or threatened against the Company[258](index=258&type=chunk) [Item 1A. Risk Factors](index=76&type=section&id=Item%201A.%20Risk%20Factors) No material changes to risk factors since the December 31, 2021 annual report on Form 10-K - No material changes to risk factors since the December 31, 2021 annual report on Form 10-K[259](index=259&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=76&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) Issued and sold 492,018 common shares for $9.8 million under registration exemption - Issued and sold **492,018 shares of common stock** for **$9.8 million** during the six months ended June 30, 2022[260](index=260&type=chunk) - Sales were exempt from registration under Section 4(a)(2) and Rule 506(b) of Regulation D of the Securities Act[260](index=260&type=chunk) [Item 3. Defaults Upon Senior Securities](index=76&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The Company reported no defaults upon senior securities during the period - No defaults upon senior securities[261](index=261&type=chunk) [Item 4. Mine Safety Disclosures](index=76&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the Company - Not applicable[262](index=262&type=chunk) [Item 5. Other Information](index=76&type=section&id=Item%205.%20Other%20Information) No other information to report - No other information to report[263](index=263&type=chunk) [Item 6. Exhibits](index=77&type=section&id=Item%206.%20Exhibits) Lists exhibits filed with Form 10-Q, including organizational documents and CEO/CFO certifications - Includes Articles of Amendment and Restatement, Bylaws, and certifications from CEO and CFO (pursuant to Sections 302 and 906 of Sarbanes-Oxley Act)[266](index=266&type=chunk) [Signatures](index=78&type=section&id=Signatures) The report was signed on August 12, 2022, by the Chief Executive Officer and Chief Financial Officer - The report was signed on August 12, 2022, by Christopher D. Long, Chief Executive Officer and Director, and Jeffrey D. Fox, Chief Financial Officer and Director[270](index=270&type=chunk)

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number: 000-56126 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2022 Palmer Square Capital BDC Inc. (Exact name of registrant as specified in its charter) | Maryland | 84-3665200 | | --- | --- | | (State or other jurisdiction of | (I.R.S. ...

Investment Portfolio - As of December 31, 2021, the company had 240 debt and equity investments in 212 portfolio companies with an aggregate fair value of approximately $1.1 billion[303]. - The size of the investment portfolio at fair value increased from $600.1 million as of December 31, 2020 to $1.1 billion as of December 31, 2021, marking an 83.6% growth[314]. - Total investments amounted to $1.19 billion, up from $640.1 million as of December 31, 2020[309]. - The total principal amount of investments funded in first-lien senior secured debt investments was $829.59 million for the year ended December 31, 2021[305]. - The company has unfunded commitments totaling $11.3 million as of December 31, 2021, compared to $1.3 million in the previous year[359]. Investment Performance - For the year ended December 31, 2021, the company made gross investments of $926.35 million, with total new investments amounting to $524.59 million after accounting for sold investments[305]. - The weighted average total yield to maturity of debt and income-producing securities at fair value was 5.77% as of December 31, 2021, compared to 4.96% as of December 31, 2020[302][303]. - The company reported a weighted average interest rate of new investment commitments at 4.80% for the year ended December 31, 2021[309]. - Total investment income for the year ended December 31, 2021 was $39.7 million, up from $25.5 million in 2020, representing a 55.8% increase[312]. - Net investment income for the year ended December 31, 2021 was $22.8 million, compared to $14.7 million in 2020, reflecting a 55.5% increase[312]. - Weighted average total yield of debt and income-producing securities rose to 5.77% in 2021 from 4.96% in 2020[311]. Financial Position - Net expenses for the year ended December 31, 2021 were $16.9 million, up from $10.8 million in 2020, indicating a 56.5% increase[315]. - Average debt outstanding increased from $247.5 million in 2020 to $447.0 million in 2021, a 80.6% rise[316]. - Total net assets increased from $253.1 million as of December 31, 2020 to $452.8 million as of December 31, 2021, a 78.8% increase[316]. - Cash and cash equivalents as of December 31, 2021 were $1.1 million, up from $683 thousand in 2020[322]. - The company experienced net cash used in operating activities of $438 million during the year ended December 31, 2021[321]. Debt and Financing - Under the Bank of America Credit Facility, the commitment amount increased to $725 million as of September 29, 2021, with approximately $552 million principal outstanding as of December 31, 2021[328][331]. - The Wells Fargo Credit Facility had a facility amount of $150 million, with approximately $100 million outstanding as of December 31, 2021[333][337]. - The company reported a total outstanding indebtedness of $550.26 million under the BoA Credit Facility as of December 31, 2021[356]. - The asset coverage ratio was 170% as of December 31, 2021, exceeding the required minimum of 150%[325]. Dividends and Distributions - The company intends to distribute dividends quarterly, subject to available income, and must distribute at least 90% of its net ordinary income to maintain RIC tax treatment[338][339]. - The company has adopted a dividend reinvestment plan, allowing stockholders to reinvest dividends in additional shares of common stock unless they opt out[342]. - The company plans to distribute net capital gains at least annually, but may retain such gains for investment purposes[341]. Management and Compliance - The company is externally managed by an Investment Advisor, which is a majority-owned subsidiary of Palmer Square, specializing in global alternative investments[297]. - The company is required to comply with various covenants and reporting requirements under its credit facilities, ensuring adherence to leverage restrictions[330][336]. - As of December 31, 2021, PS BDC Funding was in compliance with the applicable covenants in both the Bank of America and Wells Fargo Credit Facilities[331][337]. Risk Management - The company is subject to interest rate sensitivity, with potential impacts on net investment income due to changes in interest rates[361]. - A hypothetical increase of 200 basis points in interest rates could result in a net investment income increase of $4.28 million[363]. - The company measures exposure to currency exchange rate fluctuations and may use hedging instruments to mitigate risks[365]. Valuation and Accounting - The company values investments without readily available market quotations using a multi-step valuation process, including independent reviews[357]. - The company’s financial statements are prepared in accordance with generally accepted accounting principles, requiring estimates and assumptions that may affect reported amounts[348]. - The company’s net realized gains or losses are measured by the difference between net proceeds from sales and the amortized cost basis of investments[353].

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2021 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number: 000-56126 Palmer Square Capital BDC Inc. (Exact name of registrant as specified in its charter) | Maryland | 84-3665200 | | --- | --- | | (State or other jurisdiction of | (I. ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2021 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number: 000-56126 Palmer Square Capital BDC Inc. (Exact name of registrant as specified in its charter) | Maryland | 84-3665200 | | --- | --- | | (State or other jurisdiction of | (I.R.S. ...