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"Or do you believe the entire transaction is taxable at this point? "

The registration statement takes that position, clearly:

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       Ares Capital and American Capital will treat the merger as a taxable acquisition of the common stock of American Capital by Ares Capital.

    U.S. Stockholders

        Subject to the discussion below relating to the treatment of the Ares Capital Management consideration, U.S. stockholders generally should recognize gain or loss upon the exchange of their American Capital common stock for the Ares Capital consideration, the make-up dividend amount and the Mortgage Manager consideration in an amount equal to the difference between the fair market value of such merger consideration received by the U.S. stockholder and the U.S. stockholder's tax basis in his, her or its American Capital common stock. Such gain or loss generally should be capital gain or loss.

        The tax treatment of the receipt of the Ares Capital Management consideration is unclear because there is limited authority addressing the tax consequences of the receipt of merger consideration from a party other than the acquiror. If the Ares Capital Management consideration is treated as additional merger consideration received in exchange for American Capital common stock, such payment would be treated as part of the total consideration received in exchange for the American Capital common stock and treated in the manner described above. It is possible, however, that the Ares Capital Management consideration may be treated as ordinary income, and not as received in exchange for a U.S. stockholder's American Capital common stock.

        Although the matter is not free from doubt, Ares Capital, Ares Capital Management and Computershare Shareowner Services, LLC (as Ares Capital's transfer agent) intend to take the position that the Ares Capital Management consideration received by U.S. stockholders is treated as additional merger consideration, and, assuming such position is respected, any gain or loss recognized by a U.S. stockholder on the receipt of the Ares Capital Management consideration should be capital gain or loss. No assurances can be given, however, that the IRS will not assert, or that a court would not sustain, a contrary position.

        Capital gain or loss recognized by a U.S. stockholder will be long-term capital gain or loss if, as of the effective time of the merger, the U.S. stockholder's holding period for its American Capital common stock is greater than one year. Long-term capital gains for certain non-corporate U.S. stockholders, including individuals, are generally eligible for a reduced rate of U.S. federal income taxation. The deductibility of capital losses is subject to limitations. If a U.S. stockholder acquired different blocks of American Capital common stock at different times or different prices, such U.S. stockholder must determine its tax basis, holding period, and gain or loss separately with respect to each block of American Capital common stock. The rules for determining holding periods are complex. American Capital stockholders should consult their tax advisors.
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"For the new stock in my account, the brokerage firm is listing my current basis at just over $3."

I don't think I can help you here.  GENERALLY in a cash + stock deal where the transaction is fully taxable and either gain or loss can be recognized, the fair market value of the stock received is the basis of that stock.  It's "as if" all consideration was received in cash and they some of that cash was used to purchase the acquiring company's stock.

The registration statement doesn't seem to address this - at least I couldn't find it in a quick scan - but that treatment is typical, and logical.

Costbasis.com in their "Stock + boot" calculator takes that position.