As previously disclosed, on December 14, 2018, KCAP Financial Inc. (KCAP) entered into a stock purchase and transaction agreement with BC Partners Advisors L.P. (BCP), in connection with which Sierra Crest Investment Management LLC, an affiliate of BCP, would become the investment adviser to KCAP and, in exchange, BCP, or its affiliate, would make a cash payment of $25.0 million directly to KCAP's stockholders. The Transaction closed on April 1, 2019 (the Closing). Effective as of the Closing, KCAP changed its name to Portman Ridge Finance Corporation.

References herein to the “Company” refer to KCAP immediately prior to the Closing and to Portman Ridge at and after the Closing. On April 1, 2019, in connection with the Closing, all of the company's then-current directors resigned from their positions on the Board, with the exceptions of Dean Kehler and Christopher Lacovara. Prior to their resignations, the Board approved an increase in the size of the Board from seven members to eight members and appointed the following individuals to serve on the Board for the terms indicated below, each effective as of and after the Closing.

Other than as provided for in the Externalization Agreement, none of the below individuals were appointed to the Board pursuant to any arrangement or understanding with any other person, and there are no current or proposed transactions between the Company and any of the below individuals or their immediate family members which would require disclosure under Item 404(a) of Regulation S-K promulgated by the SEC. Interested directors are Ted Goldthorpe - term expire on 2021, Graeme Dell - term expire on 2020 and David Moffitt - term expire on 2019. Independent directors are Alexander Duka - term expire on 2021, George Grunebaum - term expire on 2019, Dean Kehler - term expire on 2019, Christopher Lacovara - term expire on 2021 and Robert Warshauer - term expire on 2020.

Effective as of April 1, 2019, the following Board committees were formed (i) Audit Committee, which is comprised of Messrs. Warshauer (Chair), Grunebaum, Duka and Lacovara, (ii) Nominating and Governance Committee, which is comprised of Messrs. Grunebaum (Chair), Duka and Warshauer, and (iii) Compensation Committee, which is comprised of Messrs.

Duka (Chair), Warshauer, Grunebaum and Kehler. Additionally, effective April 1, 2019, the compensation of the Company's independent directors will be as follows: each independent director will receive an annual fee of $70,000; the lead independent director will receive an additional annual fee of $10,000; the chairperson of the Audit Committee will receive an additional annual fee of $10,000; and the chairperson of each of the Nominating and Corporate Governance Committee and Compensation Committee will receive an additional annual fee of $5,000. Also, in connection with the Closing, each of the following individuals resigned as officers of the company effective as of the Closing: Dayl Pearson, the company's President and Chief Executive Officer; Edward Gilpin, the company's Chief Financial Officer, Treasurer and Secretary; R. Jon Corless, the Company's Chief Investment Officer; and Daniel Gilligan, the company's Chief Compliance Officer and Vice President and Director of Portfolio Administration.

Effective as of the Closing, the following individuals have been appointed as officers of Portman Ridge to the office listed next to their name: Ted Goldthorpe as President and Chief Executive Officer, Patrick Schafer as Chief Investment Officer, Edward Gilpin as Chief Financial Officer, Treasurer and Secretary and Daniel Gilligan as Chief Compliance Officer. Mr. Schafer is a Principal in the credit investment platform of BC Partners (“BCP Credit”) and serves as Chief Investment Officer of Portman Ridge. He joined BCP Credit in May 2018, having previously worked at Apollo Global Management.

Mr. Schafer spent seven years at Apollo in the Opportunistic Credit group, most recently as a Managing Director in Direct Originations. Prior to Apollo, he spent three years at Deutsche Bank Securities in the Investment Banking Division. Mr. Schafer holds a BBA from the University of Notre Dame.

Prior to the Closing, Mr. Gilpin served as the company's Chief Financial Officer, Treasurer and Secretary, and Mr. Gilligan served as the Company's Chief Compliance Officer. In accordance with the requirements of the Externalization Agreement, Messrs. Gilpin and Gilligan resigned as officers of the Company, effective as of the Closing.

Prior to the Closing, BCP offered employment to Messrs. Gilpin and Gilligan and, effective as of the Closing, Mr. Gilpin was appointed to serve as Chief Financial Officer, Treasurer and Secretary of Portman Ridge, and Mr. Gilligan was appointed to serve as Chief Compliance Officer of Portman Ridge. The business experience disclosure required by Item 401(e) of Regulation S-K promulgated by the SEC for Messrs.

Gilpin and Gilligan is included in the Company's definitive proxy statement on Schedule 14A for its 2018 annual meeting of stockholders, filed with the SEC on March 22, 2018, under “Proposal 1 – Election of Directors – Director and Executive Officer Background Information,” and is incorporated into this Item 5.02 by reference. On April 1, 2019, the xompany entered into new indemnification agreements with each of its directors and officers.