Morgan Stanley Direct Lending Fund 10-K

Item 7A. Quantitative and Qualitative Disclosures About Market Risk We are subject to financial market risks, including valuation risk, market risk and interest rate risk. Valuation Risk We have invested, and plan to continue to invest, primarily in illiquid debt and equity securities of portfolio companies. During periods of market dislocation, we will seek to invest prudently in the secondary loan market to provide our investors better risk adjusted returns while adhering to our core investment tenants. See “Item 1. Business—Coronavirus Developments.” Most of our investments will not have a readily available market price. To ensure accurate valuation, our investments are valued at fair value in good faith by our Board of Directors, based on, among other things, the input of the Investment Adviser, our Audit Committee and independent third-party valuation firm engaged at the direction of our Board of Directors, and in accordance with our valuation policy. There is no single standard for determining fair value. As a result, determining fair value requires that judgment be applied to the specific facts and circumstances of each investment while employing a consistently applied valuation process for the investments we hold. If we were required to liquidate a portfolio investment in a forced or liquidation sale, we may realize amounts that are different from the amounts presented and such differences could be material. Market Risk The market value of a security may move up or down, sometimes rapidly and unpredictably. These fluctuations may cause a security to be worth less than the price originally paid for it, or less than it was worth at an earlier time. Market risk may affect a single issuer, industry, sector of the economy or the market as a whole. Global economies and financial markets are increasingly interconnected, which increases the probabilities that conditions in one country or region might adversely impact issuers in a different country or region. Conditions affecting the general economy, including political, social, or economic instability at the local, regional, or global level, may also affect the market value of a security. Health crises, such as pandemic and epidemic diseases, as well as other incidents that interrupt the expected course of events, such as natural disasters, war or civil disturbance, acts of terrorism, power outages and other unforeseeable and external events, and the public response to or fear of such diseases or events, have and may in the future have an adverse effect on a company’s investments and net asset value and can lead to increased market volatility. See “Item 1A. Risk Factors—General Risk Factors—Risks Relating to Our Business and Structure—We are operating in a period of capital markets disruption and economic uncertainty. The conditions have materially and adversely affected debt and equity capital markets in the United States, and any future disruptions or instability in capital markets may have a negative impact on our business and operations.” and “Terrorist attacks, acts of war, natural disasters, outbreaks or pandemics, such as the Coronavirus pandemic, may impact our portfolio companies and our Adviser and harm our business, operating results and financial condition.” Interest Rate Risk We are subject to financial market risks, most significantly changes in interest rates. Interest rate sensitivity refers to the change in our earnings that may result from changes in the level of interest rates. Because we expect to fund a portion of our investments with borrowings, our net investment income is expected to be affected by the difference between the rate at which we invest and the rate at which we borrow. As a result, we can offer no assurance that a significant change in market interest rates will not have a material adverse effect on our net investment income. As of December 31, 2021, 99.9% of our debt investments were at floating rates. Based on our Consolidated Statement of Assets and Liabilities as of December 31, 2021, the following table shows the annualized impact on net income of hypothetical base rate changes in interest rates (considering interest rate floors and ceilings for floating rate debt instruments assuming no changes in our investments and borrowing structure as of December 31, 2021) (dollar amounts in thousands): 91 Table of Contents Interest Interest Net Basis Point Change - Interest Rates Income Expense Income Up 300 basis points $ 55,033 $ (37,496) $ 17,537 Up 200 basis points $ 31,271 $ (24,997) $ 6,274 Up 100 basis points $ 7,510 $ (12,499) $ (4,989) Down 100 basis points $ (34) $ 1,265 $ 1,231 Down 200 basis points $ (34) $ 1,265 $ 1,231 Down 300 basis points $ (34) $ 1,265 $ 1,231 We may hedge against interest rate fluctuations by using standard hedging instruments such as futures, options and forward contracts or our credit facilities, subject to the requirements of the 1940 Act and applicable commodities laws. While hedging activities may insulate us against adverse changes in interest rates, they may also limit our ability to participate in benefits of lower interest rates or higher exchange rates with respect to our portfolio of investments with fixed interest rates or investments denominated in foreign currencies. During the periods covered by this Form 10-K, we did not engage in interest rate hedging activities. 92 Table of Contents Item 8. Consolidated Financial Statements and Supplementary Data Table of contents Report of Independent Registered Public Accounting Firm 94 Consolidated Statements of Assets and Liabilities as of December 31, 2021 and 2020 95 Consolidated Statements of Operations for the Year ended December 31, 2021, December 31, 2020, and From May 19, 2019 (inception) to December 31, 2019 96 Consolidated Statements of Changes in Net Assets for the Year ended December 31, 2021, December 31, 2020, and From May 19, 2019 (inception) to December 31, 2019 . 97 Consolidated Statements of Cash Flows for the Year ended December 31, 2021, December 31, 2021, December 31, 2020, and From May 19, 2019 (inception) to December 31, 2019. 98 Consolidated Schedule of Investments as of December 31, 2021 and 2020 100 Notes to the Consolidated Financial Statements 122 93 Table of Contents REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the stockholders and the Board of Directors of Morgan Stanley Direct Lending Fund Opinion on the Financial Statements We have audited the accompanying consolidated statements of assets and liabilities of Morgan Stanley Direct Lending Fund and subsidiaries (the "Company"), including the consolidated schedule of investments, as of December 31, 2021 and 2020, the related consolidated statements of operations, changes in net assets and cash flows for the years ended December 31, 2021 and 2020 and the period from May 30, 2019 (inception) to December 31, 2019, the financial highlights for the years ended December 31, 2021, and 2020, and the related notes. In our opinion, the consolidated financial statements and financial highlights present fairly, in all material respects, the financial position of the Company as of December 31, 2021 and 2020, and the results of its operations, changes in net assets, cash flows, and financial highlights for the years ended December 31, 2021 and 2020 and the period from May 30, 2019 (inception) to December 31, 2019 in conformity with accounting principles generally accepted in the United States of America. Basis for Opinion These consolidated financial statements and financial highlights are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's consolidated financial statements and financial highlights based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements and financial highlights are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements and financial highlights, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements and financial highlights. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements and financial highlights. Our procedures included confirmation of investments owned as of December 31, 2021, and 2020, by correspondence with the custodian, loan agents, and borrowers; when replies were not received, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion. /s/Deloitte & Touche LLP New York, NY March 18, 2022 We have served as the Company's auditor since 2019. 94 Table of Contents Morgan Stanley Direct Lending Fund Consolidated Statements of Assets and Liabilities (In thousands, except share and per share amounts) December 31, 2021 December 31, 2020 Assets Non-controlled/non-affiliated Investments, at fair value (amortized cost of $2,373,435 and $631,473 at December 31, 2021 and December 31, 2020, respectively) $ 2,387,374 $ 636,981 Cash 74,153 11,263 Deferred financing costs 11,587 5,987 Deferred offering costs — 18 Interest and dividend receivable from non-controlled/non-affiliated investments 11,740 2,280 Subscription receivable 7,850 — Receivable for investments sold 301 79 Prepaid expenses and other assets 268 198 Total assets 2,493,273 656,806 Liabilities Debt 1,249,850 333,850 Payable to affiliates (Note 3) 4,431 1,860 Financing costs payable 4,234 3,925 Dividends payable 29,691 9,165 Management fees payable 1,306 295 Income based incentive fees payable 5,886 1,548 Capital gains based incentive fees payable 2,773 1,341 Interest payable 3,281 1,154 Accrued expenses and other liabilities 3,234 2,048 Total liabilities 1,304,686 355,186 Commitments and Contingencies (Note 7) Net Assets Common stock, par value $0.001 (100,000,000 shares authorized and 56,838,027 and 15,024,425 shares issued and outstanding as of December 31, 2021 and December 31, 2020, respectively) 57 15 Paid-in capital in excess of par value 1,172,748 296,903 Net distributable earnings (accumulated losses) 15,782 4,702 Total net assets $ 1,188,587 $ 301,620 Total liabilities and net assets $ 2,493,273 $ 656,806 Net asset value per share $ 20.91 $ 20.08 The accompanying notes are an integral part of these consolidated financial statements 95 Table of Contents Morgan Stanley Direct Lending Fund Consolidated Statements of Operations (In thousands, except share and per share amounts) For the year ended December 31, 2021 For the year ended December 31, 2020 From May 30, 2019 (inception) to December 31, 2019 Investment Income: From non-controlled/non-affiliated investments: Interest income $ 108,277 $ 20,269 $ — Payment-in-kind interest income 1,021 9 — Dividend income 409 — — Other income 10,109 1,625 — Total investment income 119,816 21,903 — Expenses: Interest expense and other financing expense 21,015 3,725 — Management fees 13,860 2,238 — Income based incentive fees 15,852 2,517 — Capital gains incentive fees 1,809 1,341 — Professional fees 2,440 1,654 66 Organization and offering costs 42 676 1,079 Directors’ fees 336 349 43 Administrative service fees 212 183 — General and other expenses 1,538 493 47 Total expenses 57,104 13,176 1,235 Expense support (Note 3) 98 (230) (79) Management fees waiver (Note 3) (10,395) (1,678) — Net expenses 46,807 11,268 1,156 Net investment income (loss) before taxes 73,009 10,635 (1,156) Excise tax expense 80 — — Net investment income/(loss) after taxes 72,929 10,635 (1,156) Realized and unrealized gain (loss) on investment transactions: Net realized gain (loss): Non-controlled/non-affiliated investments 1,895 2,154 — Net change in unrealized appreciation (depreciation): Non-controlled/non-affiliated investments 8,431 5,508 — Net realized and unrealized gain (loss) 10,326 7,662 — Net increase (decrease) in net assets resulting from operations $ 83,255 $ 18,297 $ (1,156) Per share information—basic and diluted Net investment income (loss) per share (basic and diluted): $ 2.34 $ 1.41 $ (660.54) Earnings per share (basic and diluted): $ 2.67 $ 2.42 $ — Weighted average shares outstanding (basic and diluted) (Note 9): 31,159,302 7,559,426 1,750 The accompanying notes are an integral part of these consolidated financial statements 96 Table of Contents Morgan Stanley Direct Lending Fund Consolidated Statements of Changes in Net Assets (In thousands) For the year ended December 31, 2021 For the year ended December 31, 2020 From May 30, 2019 (inception) to December 31, 2019 Net assets at beginning of period $ 301,620 $ (1,121) $ — Increase (decrease) in net assets resulting from operations: Net investment income (loss) 72,929 10,635 (1,156) Net realized gain (loss) 1,895 2,154 — Net change in unrealized appreciation (depreciation) 8,431 5,508 — Net increase (decrease) in net assets resulting from operations 83,255 18,297 (1,156) Capital transactions: Issuance of common stock 862,455 297,347 35 Reinvestment of dividends 13,572 1,023 — Dividends declared (72,315) (13,926) — Net increase (decrease) in net assets resulting from capital transactions 803,712 284,444 35 Total increase (decrease) in net assets 886,967 302,741 (1,121) Net assets at end of period $ 1,188,587 $ 301,620 $ (1,121) The accompanying notes are an integral part of these consolidated financial statements 97 Table of Contents Morgan Stanley Direct Lending Fund Consolidated Statements of Cash Flows (In thousands) For the year ended December 31, 2021 For the year ended December 31, 2020 From May 30, 2019 (inception) to December 31, 2019 Cash flows from operating activities: Net increase (decrease) in net assets resulting from operations $ 83,255 $ 18,297 $ (1,156) Adjustments to reconcile net increase (decrease) in net assets resulting from operations to net cash provided by (used in) operating activities: Net unrealized (appreciation) depreciation on investments (8,431) (5,508) — Net realized (gain) loss on investments (1,895) (2,154) — Net accretion of discount and amortization of premium on investments (10,133) (3,606) — Payment-in-kind interest and dividend capitalized (1,179) (9) — Amortization of deferred financing costs 2,913 1,072 — Amortization of deferred offering costs 24 258 — Purchases of investments and change in payable for investments purchased (2,113,463) (714,658) — Proceeds from sales and repayments of investments and change in receivable for investments sold 384,486 88,875 — Changes in operating assets and liabilities: (Increase) decrease in interest receivable from non-controlled/non-affiliated investments (9,460) (2,280) — (Increase) decrease in deferred offering costs — — (212) (Increase) decrease in prepaid expenses and other assets (70) 23 (221) (Decrease) increase in payable to affiliates 2,571 461 1,037 (Decrease) increase in management fees payable 1,011 295 — (Decrease) increase in incentive fees payable 5,770 2,889 — (Decrease) increase in interest payable 2,127 1,154 — (Decrease) increase in accrued expenses and other liabilities 1,186 1,540 552 Net cash provided by (used in) operating activities (1,661,288) (613,351) — Cash flows from financing activities: Borrowings on debt 1,514,000 612,350 — Repayments on debt (598,000) (278,500) — Deferred financing costs paid (8,204) (2,780) — Dividends paid in cash (38,217) (3,738) — Proceeds from issuance of common stock 854,605 297,347 35 Offering costs paid (6) (100) — Net cash provided by (used in) financing activities 1,724,178 624,579 35 Net increase (decrease) in cash 62,890 11,228 35 Cash, beginning of period 11,263 35 — Cash, end of period $ 74,153 $ 11,263 $ 35 98 Table of Contents Morgan Stanley Direct Lending Fund Consolidated Statements of Cash Flows (In thousands) Supplemental information and non-cash activities: Accrued but unpaid excise tax expense (Note 2) $ 75 $ — $ — Interest expense paid $ 14,956 $ 1,094 $ — Dividend reinvestment paid $ 13,572 $ 1,023 $ — Accrued but unpaid dividends $ 29,691 $ 9,165 $ — Subscriptions receivable $ 7,850 $ — $ — Accrued but unpaid deferred financing costs $ 1,487 $ 3,425 $ 958 Accrued but unpaid deferred offering costs $ — $ — $ 38 The accompanying notes are an integral part of these consolidated financial statements 99 Morgan Stanley Direct Lending Fund Consolidated Schedule of Investments December 31, 2021 (In thousands) Investments-non-controlled/non-affiliated (1)(2) Footnotes Reference Rate and Spread Interest Rate (3) Acquisition Date Maturity Date Par Amount/ Shares Cost (4) Fair Value Percentage of Net Assets First Lien Debt Aerospace and Defense Jonathan Acquisition Company (5) (7) L + 5.00% 6.00% 02/12/2021 12/22/2026 2,739 $ 2,671 $ 2,671 0.22 % PCX Holding Corp. (5) (6) (7) L + 6.25% 7.25% 04/22/2021 04/22/2027 18,417 18,250 18,417 1.55 PCX Holding Corp. (5) (7) (13) L + 6.25% 7.25% 04/22/2021 04/22/2027 7,386 7,309 7,386 0.62 PCX Holding Corp. (5) (7) (13) L + 6.25% 7.25% 04/22/2021 04/22/2027 — (16) — 0.00 Two Six Labs, LLC (5) (8) L + 5.50% 6.25% 08/24/2021 08/20/2027 11,070 10,859 10,960 0.92 Two Six Labs, LLC (5) (8) (13) L + 5.50% 6.25% 08/24/2021 08/20/2027 — (40) (43) 0.00 Two Six Labs, LLC (5) (8) (13) L + 5.50% 6.25% 08/24/2021 08/20/2027 — (40) (21) 0.00 38,993 39,370 3.31 Air Freight & Logistics Omni Intermediate Holdings, LLC (5) (7) L + 5.00% 6.00% 12/02/2021 12/30/2026 10,621 10,516 10,516 0.88 Omni Intermediate Holdings, LLC (5) (7) (13) L + 5.00% 6.00% 12/02/2021 12/30/2026 1,195 1,176 1,176 0.10 Omni Intermediate Holdings, LLC (5) (7) (13) L + 5.00% 6.00% 11/30/2021 12/30/2025 266 256 256 0.02 11,948 11,948 1.01 Auto Components CC SAG Holdings Corp. (Spectrum Automotive) (5) (6) (8) L + 5.75% 6.50% 06/29/2021 06/29/2028 23,890 23,553 23,613 1.99 CC SAG Holdings Corp. (Spectrum Automotive) (5) (8) (13) L + 5.75% 6.50% 06/29/2021 06/29/2028 2,167 2,105 2,091 0.18 CC SAG Holdings Corp. (Spectrum Automotive) (5) (8) (13) L + 5.75% 6.50% 06/29/2021 06/29/2027 — (12) (10) 0.00 Sonny’s Enterprises, Inc. (5) (7) L + 5.50% 6.50% 11/01/2021 08/05/2026 7,075 6,938 6,938 0.58 Sonny’s Enterprises, Inc. (5) (6) (7) L + 6.75% 7.75% 12/28/2020 08/05/2026 5,414 5,321 5,321 0.45 Sonny’s Enterprises, Inc. (5) (7) (13) L + 6.75% 7.75% 12/28/2020 08/05/2026 14,447 14,203 14,203 1.19 Sonny’s Enterprises, Inc. (5) (7) (13) L + 5.50% 6.50% 11/01/2021 08/05/2026 — (410) (410) (0.03) 51,698 51,746 4.35 Automobiles ARI Network Services, Inc. (5) (6) (7) L + 6.50% 7.50% 06/30/2021 02/28/2025 20,931 20,563 20,767 1.75 ARI Network Services, Inc. (5) (6) (7) (13) L + 6.50% 7.50% 06/30/2021 02/28/2025 3,667 3,603 3,639 0.31 ARI Network Services, Inc. (5) (7) (13) L + 6.50% 7.50% 06/30/2021 02/28/2025 1,333 1,281 1,310 0.11 Summit Buyer, LLC (5) (7) L + 5.00% 6.00% 09/17/2021 01/14/2026 22,344 21,923 22,167 1.86 Summit Buyer, LLC (5) (7) (13) L + 5.00% 6.00% 06/23/2021 01/14/2026 18,887 18,416 18,630 1.57 100 Table of Contents Morgan Stanley Direct Lending Fund Consolidated Schedule of Investments (continued) December 31, 2021 (In thousands) Investments-non-controlled/non-affiliated (1)(2) Footnotes Reference Rate and Spread Interest Rate (3) Acquisition Date Maturity Date Par Amount/ Shares Cost (4) Fair Value Percentage of Net Assets Summit Buyer, LLC (5) (7) (13) L + 5.00% 6.00% 06/23/2021 01/14/2026 — $ (43) $ (19) 0.00 % Turbo Buyer, Inc. (5) (7) L + 6.00% 7.00% 11/15/2021 12/02/2025 38,325 37,645 37,580 3.16 Turbo Buyer, Inc. (5) (7) (13) L + 6.00% 7.00% 11/15/2021 12/02/2025 36,890 36,086 36,142 3.04 Vehlo Purchaser, LLC (5) (8) L + 5.00% 5.75% 08/27/2021 08/27/2027 27,154 26,638 26,725 2.25 Vehlo Purchaser, LLC (5) (8) (13) L + 5.00% 5.75% 08/27/2021 08/27/2027 7,875 7,614 7,568 0.64 Vehlo Purchaser, LLC (5) (8) (13) L + 5.00% 5.75% 08/27/2021 08/27/2027 1,167 1,057 1,074 0.09 174,783 175,583 14.77 Biotechnology GraphPad Software, LLC (5) (6) (7) L + 5.50% 6.50% 10/26/2021 04/27/2027 15,110 14,971 14,971 1.26 GraphPad Software, LLC (5) (7) (13) L + 6.00% 7.00% 04/28/2021 04/27/2027 — (16) (16) 0.00 14,955 14,955 1.26 Commercial Services & Supplies 365 Retail Markets, LLC (5) (7) L + 4.75% 5.75% 08/31/2021 12/23/2026 17,456 17,167 17,238 1.45 365 Retail Markets, LLC (5) (7) (13) L + 4.75% 5.75% 11/05/2021 12/23/2026 — (34) (34) 0.00 365 Retail Markets, LLC (5) (7) (13) L + 4.75% 5.75% 08/31/2021 12/23/2026 800 754 765 0.06 Capstone Acquisition Holdings, Inc. (5) (6) (7) L + 4.75% 5.75% 11/13/2020 11/12/2027 3,460 3,433 3,460 0.29 Capstone Acquisition Holdings, Inc. (5) (7) (13) L + 4.75% 5.75% 11/13/2020 11/12/2027 194 191 194 0.02 Encore Holdings, LLC (5) (8) L + 4.50% 5.25% 11/23/2021 11/23/2028 1,868 1,836 1,836 0.15 Encore Holdings, LLC (5) (8) (13) L + 4.50% 5.25% 11/23/2021 11/23/2028 512 477 477 0.04 Encore Holdings, LLC (5) (8) (13) L + 4.50% 5.25% 11/23/2021 11/23/2027 — (9) (9) 0.00 FLS Holding, Inc. (5) (7) (10) L + 5.25% 6.25% 12/17/2021 12/17/2028 28,750 28,178 28,178 2.37 FLS Holding, Inc. (5) (7) (10) (13) L + 5.25% 6.25% 12/17/2021 12/17/2028 — (62) (62) (0.01) FLS Holding, Inc. (5) (7) (10) (13) L + 5.25% 6.25% 12/17/2021 12/17/2027 — (50) (50) 0.00 KWOR Acquisition, Inc. (5) (8) L + 5.25% 6.00% 12/22/2021 12/22/2028 878 865 865 0.07 KWOR Acquisition, Inc. (5) (13) P + 4.25% 7.50% 12/22/2021 12/22/2027 12 10 10 0.00 MHE Intermediate Holdings, LLC (5) (6) (7) L + 5.75% 6.75% 07/21/2021 07/21/2027 28,678 28,139 28,392 2.39 MHE Intermediate Holdings, LLC (5) (7) (13) L + 5.75% 6.75% 07/21/2021 07/21/2027 2,160 2,104 2,122 0.18 MHE Intermediate Holdings, LLC (5) (7) (13) L + 5.75% 6.75% 07/21/2021 07/21/2027 — (46) (25) 0.00 PDFTron US Acquisition Corp. (5) (6) (7) (10) L + 5.50% 6.50% 07/15/2021 07/15/2027 30,723 30,226 29,894 2.52 PDFTron US Acquisition Corp. (5) (7) (10) (13) L + 5.50% 6.50% 07/15/2021 07/15/2027 6,160 6,044 5,896 0.50 101 Table of Contents Morgan Stanley Direct Lending Fund Consolidated Schedule of Investments (continued) December 31, 2021 (In thousands) Investments-non-controlled/non-affiliated (1)(2) Footnotes Reference Rate and Spread Interest Rate (3) Acquisition Date Maturity Date Par Amount/ Shares Cost (4) Fair Value Percentage of Net Assets PDFTron US Acquisition Corp. (5) (7) (10) (13) L + 5.50% 6.50% 07/15/2021 07/15/2026 — $ (140) $ (208) (0.02) % Pritchard Industries, LLC (5) (8) L + 5.50% 6.25% 10/13/2021 10/13/2027 25,789 25,289 25,289 2.13 Pritchard Industries, LLC (5) (8) (13) L + 5.50% 6.25% 10/13/2021 10/13/2027 — (59) (59) 0.00 Procure Acquireco, Inc. (Procure Analytics) (5) (8) L + 5.50% 6.25% 12/20/2021 12/20/2028 3,968 3,889 3,889 0.33 Procure Acquireco, Inc. (Procure Analytics) (5) (8) (13) L + 5.50% 6.25% 12/20/2021 12/20/2028 — (8) (8) 0.00 Procure Acquireco, Inc. (Procure Analytics) (5) (8) (13) L + 5.50% 6.25% 12/20/2021 12/20/2028 — (5) (5) 0.00 Sherlock Buyer Corp. (5) (8) L + 5.75% 6.50% 12/08/2021 12/08/2028 11,145 10,923 10,923 0.92 Sherlock Buyer Corp. (5) (8) (13) L + 5.75% 6.50% 12/08/2021 12/08/2028 — (32) (32) 0.00 Sherlock Buyer Corp. (5) (8) (13) L + 5.75% 6.50% 12/08/2021 12/08/2027 — (25) (25) 0.00 Sweep Purchaser, LLC (5) (7) L + 5.75% 6.75% 11/30/2020 11/30/2026 8,793 8,644 8,644 0.73 Sweep Purchaser, LLC (5) (7) (13) L + 5.75% 6.75% 02/12/2021 11/30/2026 5,029 4,942 4,942 0.42 Sweep Purchaser, LLC (5) (13) P + 4.75% 8.00% 11/30/2020 11/30/2026 450 427 427 0.04 United Flow Technologies Intermediate Holdco II, LLC (5) (7) L + 5.75% 6.75% 10/29/2021 10/29/2027 17,100 16,766 16,766 1.41 United Flow Technologies Intermediate Holdco II, LLC (5) (7) (13) L + 5.75% 6.75% 10/29/2021 10/29/2027 2,400 2,280 2,280 0.19 United Flow Technologies Intermediate Holdco II, LLC (5) (7) (13) L + 5.75% 6.75% 10/29/2021 10/29/2026 — (58) (58) 0.00 US Infra Svcs Buyer, LLC (5) (6) (7) L + 6.50% 7.50% 04/10/2020 04/13/2026 16,991 16,734 16,903 1.42 US Infra Svcs Buyer, LLC (5) (7) (13) L + 6.50% 7.50% 04/10/2020 04/13/2026 2,398 2,246 2,343 0.20 US Infra Svcs Buyer, LLC (5) (7) (13) L + 6.50% 7.50% 04/10/2020 04/13/2026 2,025 1,993 2,013 0.17 Valcourt Holdings II, LLC (5) (6) (7) L + 5.50% 6.50% 03/15/2021 01/07/2027 35,431 34,816 35,431 2.98 Valcourt Holdings II, LLC (5) (7) (13) L + 5.50% 6.50% 01/07/2021 01/07/2027 2,521 2,405 2,521 0.21 Vessco Midco Holdings, LLC (5) (6) (7) L + 4.50% 5.50% 10/30/2020 11/02/2026 2,735 2,713 2,735 0.23 Vessco Midco Holdings, LLC (5) (7) (13) L + 4.50% 5.50% 10/30/2020 11/02/2026 1,472 1,457 1,472 0.12 Vessco Midco Holdings, LLC (5) (13) P + 3.50% 6.75% 10/30/2020 10/18/2026 20 16 20 0.00 VRC Companies, LLC (5) (6) (8) L + 5.50% 6.25% 06/30/2021 06/29/2027 49,335 48,644 48,921 4.12 VRC Companies, LLC (5) (6) (8) (13) L + 5.50% 6.25% 06/30/2021 06/29/2027 3,263 3,148 3,193 0.27 VRC Companies, LLC (5) (8) (13) L + 5.50% 6.25% 06/30/2021 06/29/2027 — (23) (14) 0.00 306,205 307,450 25.87 Construction & Engineering KPSKY Acquisition, Inc. (5) (8) L + 5.50% 6.25% 10/19/2021 10/19/2028 34,557 33,882 33,882 2.85 102 Table of Contents Morgan Stanley Direct Lending Fund Consolidated Schedule of Investments (continued) December 31, 2021 (In thousands) Investments-non-controlled/non-affiliated (1)(2) Footnotes Reference Rate and Spread Interest Rate (3) Acquisition Date Maturity Date Par Amount/ Shares Cost (4) Fair Value Percentage of Net Assets KPSKY Acquisition, Inc. (5) (13) P + 4.50% 7.75% 10/19/2021 10/19/2028 1,975 $ 1,917 $ 1,917 0.16 % 35,799 35,799 3.01 Containers & Packaging BP Purchaser, LLC (5) (8) L + 5.50% 6.25% 12/10/2021 12/10/2028 17,467 17,120 17,120 1.44 Fortis Solutions Group, LLC (5) (8) L + 5.50% 6.25% 10/15/2021 10/13/2028 19,430 19,051 19,051 1.60 Fortis Solutions Group, LLC (5) (8) (13) L + 5.50% 6.25% 10/15/2021 10/13/2028 — (76) (76) (0.01) Fortis Solutions Group, LLC (5) (8) (13) L + 5.50% 6.25% 10/15/2021 10/15/2027 — (52) (52) 0.00 36,043 36,043 3.03 Distributors PT Intermediate Holdings III, LLC (5) (8) L + 5.50% 6.25% 11/11/2021 11/01/2028 17,400 17,228 17,228 1.45 PT Intermediate Holdings III, LLC (5) (8) (13) L + 5.50% 6.25% 11/11/2021 11/01/2028 11,521 11,408 11,408 0.96 28,636 28,636 2.41 Diversified Consumer Services Mammoth Holdings, LLC (5) (6) (7) L + 6.00% 7.00% 03/23/2021 10/16/2023 8,117 8,058 8,117 0.68 Mammoth Holdings, LLC (5) (7) (13) L + 6.00% 7.00% 06/15/2021 10/16/2023 28,858 28,590 28,858 2.43 Mammoth Holdings, LLC (5) (7) (13) L + 6.00% 7.00% 03/23/2021 10/16/2023 — (6) — 0.00 36,642 36,975 3.11 Diversified Financial Services SitusAMC Holdings Corporation (5) (8) L + 5.75% 6.50% 12/22/2021 12/22/2027 3,600 3,564 3,564 0.30 Food Products AMCP Pet Holdings, Inc. (Brightpet) (5) (6) (7) L + 6.25% 7.25% 10/06/2020 10/05/2026 33,825 32,969 33,527 2.82 AMCP Pet Holdings, Inc. (Brightpet) (5) (7) (13) L + 6.25% 7.25% 10/06/2020 10/05/2026 — (119) (44) 0.00 AMCP Pet Holdings, Inc. (Brightpet) (5) (7) (13) L + 6.25% 7.25% 10/06/2020 10/05/2026 3,938 3,796 3,886 0.33 Nellson Nutraceutical, Inc. (5) (6) (7) L + 5.25% 6.25% 09/30/2020 12/23/2023 24,606 24,292 24,606 2.07 Nellson Nutraceutical, Inc. (5) (6) P + 4.25% 7.50% 09/30/2020 12/23/2023 66 65 66 0.01 Teasdale Foods, Inc. (Teasdale Latin Foods) (5) (7) L + 6.25%; 1.00% PIK 8.25% 12/18/2020 12/18/2025 11,148 10,965 10,029 0.84 71,968 72,070 6.06 Health Care Equipment & Supplies Performance Health Holdings, Inc. (5) (6) (7) L + 6.00% 7.00% 07/12/2021 07/12/2027 10,474 10,278 10,474 0.88 103 Table of Contents Morgan Stanley Direct Lending Fund Consolidated Schedule of Investments (continued) December 31, 2021 (In thousands) Investments-non-controlled/non-affiliated (1)(2) Footnotes Reference Rate and Spread Interest Rate (3) Acquisition Date Maturity Date Par Amount/ Shares Cost (4) Fair Value Percentage of Net Assets Health Care Providers & Services Bearcat Buyer, Inc. (5) (6) (7) L + 4.75% 5.75% 11/18/2020 07/09/2026 6,843 $ 6,700 $ 6,843 0.58 % Bearcat Buyer, Inc. (5) (7) (13) L + 4.75% 5.75% 11/18/2020 07/09/2026 6,262 6,122 6,262 0.53 DCA Investment Holdings, LLC (5) (6) (8) L + 6.25% 7.00% 03/12/2021 03/12/2027 11,175 11,027 11,175 0.94 DCA Investment Holdings, LLC (5) (8) (13) L + 6.25% 7.00% 03/12/2021 03/12/2027 1,079 1,053 1,079 0.09 Heartland Veterinary Partners, LLC (5) (7) L + 4.75% 5.75% 11/17/2021 12/10/2026 1,885 1,866 1,866 0.16 Heartland Veterinary Partners, LLC (5) (7) (13) L + 4.75% 5.75% 11/17/2021 12/10/2026 424 383 383 0.03 Heartland Veterinary Partners, LLC (5) (7) (13) L + 4.75% 5.75% 11/17/2021 12/10/2026 — (4) (4) 0.00 mPulse Mobile, Inc. (5) (8) L + 5.25% 6.00% 12/17/2021 12/17/2027 17,500 17,152 17,152 1.44 mPulse Mobile, Inc. (5) (8) (13) L + 5.25% 6.00% 12/17/2021 12/17/2027 — (20) (20) 0.00 mPulse Mobile, Inc. (5) (8) (13) L + 5.25% 6.00% 12/17/2021 12/17/2027 — (10) (10) 0.00 Promptcare Infusion Buyer, Inc. (5) (7) L + 6.00% 7.00% 09/01/2021 09/01/2027 9,165 8,990 8,948 0.75 Promptcare Infusion Buyer, Inc. (5) (7) (13) L + 6.00% 7.00% 09/01/2021 09/01/2027 837 792 745 0.06 Suveto Buyer, LLC (5) (8) (13) L + 4.25% 5.00% 09/09/2021 09/09/2027 7,755 7,643 7,608 0.64 Suveto Buyer, LLC (5) (13) P + 3.25% 6.50% 09/09/2021 09/09/2027 590 575 575 0.05 62,269 62,602 5.27 Health Care Technology Lightspeed Buyer, Inc. (5) (6) (7) L + 5.75% 6.75% 08/31/2021 02/03/2026 12,797 12,506 12,229 1.03 Lightspeed Buyer, Inc. (5) (7) (13) L + 5.75% 6.75% 08/31/2021 02/03/2026 9,328 9,056 8,734 0.73 21,562 20,963 1.76 Industrial Conglomerates Electrical Source Holdings LLC (5) (6) (8) L + 5.50% 6.25% 12/11/2020 11/25/2025 29,550 29,330 29,550 2.49 Electrical Source Holdings LLC (5) (6) (8) (13) L + 5.50% 6.25% 08/31/2021 11/25/2025 6,538 6,449 6,538 0.55 Electrical Source Holdings LLC (5) (8) (13) L + 5.50% 6.25% 01/20/2021 11/25/2025 197 179 197 0.02 35,958 36,285 3.05 Insurance Foundation Risk Partners, Corp. (5) (8) L + 5.75% 6.50% 10/29/2021 10/29/2028 43,291 42,654 42,654 3.59 Foundation Risk Partners, Corp. (5) (8) (13) L + 5.75% 6.50% 10/29/2021 10/29/2028 5,378 5,269 5,269 0.44 Foundation Risk Partners, Corp. (5) (8) (13) L + 5.75% 6.50% 10/29/2021 10/29/2027 — (67) (67) (0.01) Galway Borrower, LLC (5) (8) L + 5.25% 6.00% 09/30/2021 09/29/2028 26,722 26,203 26,260 2.21 Galway Borrower, LLC (5) (8) (13) L + 5.25% 6.00% 09/30/2021 09/29/2028 1,843 1,766 1,736 0.15 104 Table of Contents Morgan Stanley Direct Lending Fund Consolidated Schedule of Investments (continued) December 31, 2021 (In thousands) Investments-non-controlled/non-affiliated (1)(2) Footnotes Reference Rate and Spread Interest Rate (3) Acquisition Date Maturity Date Par Amount/ Shares Cost (4) Fair Value Percentage of Net Assets Galway Borrower, LLC (5) (8) (13) L + 5.25% 6.00% 09/30/2021 09/30/2027 — $ (39) $ (35) 0.00 % Higginbotham Insurance Agency, Inc. (5) (6) (8) L + 5.50% 6.25% 12/15/2020 11/25/2026 14,558 14,374 14,413 1.21 Higginbotham Insurance Agency, Inc. (5) (8) (13) L + 5.50% 6.25% 12/15/2020 11/25/2026 4,110 4,055 4,069 0.34 High Street Buyer, Inc. (5) (6) (8) L + 6.00% 6.75% 04/16/2021 04/14/2028 10,093 9,908 10,093 0.85 High Street Buyer, Inc. (5) (6) (8) (13) L + 6.00% 6.75% 04/16/2021 04/14/2028 37,138 36,402 37,138 3.12 High Street Buyer, Inc. (5) (8) (13) L + 6.00% 6.75% 04/16/2021 04/16/2027 — (38) — 0.00 Integrity Marketing Acquisition, LLC (5) (6) (8) (13) L + 5.50% 6.25% 07/09/2021 08/27/2025 58,911 58,193 58,193 4.90 Integrity Marketing Acquisition, LLC (5) (7) (13) L + 5.75% 6.75% 02/05/2021 08/27/2025 24,849 24,545 24,545 2.07 Keystone Agency Investors (5) (7) L + 5.50% 6.50% 12/21/2021 05/03/2027 2,003 1,973 1,974 0.17 Keystone Agency Investors (5) (7) (13) L + 5.50% 6.50% 12/21/2021 05/03/2027 — (38) (38) 0.00 Majesco (5) (6) (7) L + 7.25% 8.25% 09/21/2020 09/21/2027 23,660 23,104 23,660 1.99 Majesco (5) (7) (13) L + 7.25% 8.25% 09/21/2020 09/21/2026 — (37) — 0.00 Patriot Growth Insurance Services, LLC (5) (6) (8) L + 5.50% 6.25% 10/14/2021 10/14/2028 45,812 44,918 44,918 3.78 Patriot Growth Insurance Services, LLC (5) (7) (13) L + 5.75% 6.75% 10/14/2021 10/16/2028 — (171) (171) (0.01) Patriot Growth Insurance Services, LLC (5) (8) (13) L + 5.50% 6.25% 10/14/2021 10/14/2027 — (86) (86) (0.01) Peter C. Foy & Associates Insurance Services, LLC (5) (8) L + 6.00% 6.75% 11/02/2021 11/01/2028 17,972 17,796 17,796 1.50 Peter C. Foy & Associates Insurance Services, LLC (5) (8) (13) L + 6.00% 6.75% 11/02/2021 11/01/2028 3,433 3,392 3,392 0.29 Peter C. Foy & Associates Insurance Services, LLC (5) (8) (13) L + 6.00% 6.75% 11/02/2021 11/01/2027 — (8) (8) 0.00 RSC Acquisition, Inc. (5) (6) (8) L + 5.50% 6.25% 11/12/2021 10/30/2026 18,667 18,287 18,484 1.56 RSC Acquisition, Inc. (5) (8) (13) L + 5.50% 6.25% 11/12/2021 10/30/2026 5,911 5,772 5,772 0.49 World Insurance Associates, LLC (5) (6) (7) L + 5.75% 6.75% 04/01/2021 04/01/2026 33,658 32,601 32,996 2.78 World Insurance Associates, LLC (5) (6) (7) (13) L + 5.75% 6.75% 01/15/2021 04/01/2026 31,487 30,671 30,868 2.60 World Insurance Associates, LLC (5) (7) (13) L + 5.75% 6.75% 04/01/2021 04/01/2026 95 74 70 0.01 401,473 403,895 33.98 Interactive Media & Services FMG Suite Holdings, LLC (5) (7) L + 5.50% 6.50% 04/30/2021 10/30/2026 22,253 21,854 22,171 1.87 FMG Suite Holdings, LLC (5) (7) (13) L + 5.50% 6.50% 04/30/2021 10/30/2026 — (92) (19) 0.00 FMG Suite Holdings, LLC (5) (7) (13) L + 5.50% 6.50% 04/30/2021 10/30/2026 — (46) (10) 0.00 MSM Acquisitions, Inc. (5) (6) (7) L + 6.00% 7.00% 12/09/2020 12/09/2026 31,890 31,412 31,571 2.66 MSM Acquisitions, Inc. (5) (7) (13) L + 6.00% 7.00% 12/09/2020 12/09/2026 9,782 9,488 9,419 0.79 105 Table of Contents Morgan Stanley Direct Lending Fund Consolidated Schedule of Investments (continued) December 31, 2021 (In thousands) Investments-non-controlled/non-affiliated (1)(2) Footnotes Reference Rate and Spread Interest Rate (3) Acquisition Date Maturity Date Par Amount/ Shares Cost (4) Fair Value Percentage of Net Assets MSM Acquisitions, Inc. (5) (13) P + 5.00% 8.25% 12/09/2020 12/09/2026 365 $ 300 $ 326 0.03 % Triple Lift, Inc. (5) (6) (8) L + 5.75% 6.50% 05/06/2021 05/08/2028 27,860 27,345 27,604 2.32 Triple Lift, Inc. (5) (8) (13) L + 5.75% 6.50% 05/06/2021 05/08/2028 — (72) (37) 0.00 90,189 91,025 7.66 IT Services Atlas Purchaser, Inc. (6) (8) L + 5.25% 6.00% 05/03/2021 05/08/2028 17,413 17,090 17,064 1.44 Donuts, Inc. (5) (6) (7) L + 6.00% 7.00% 01/20/2021 12/29/2026 18,563 18,237 18,563 1.56 Govbrands Intermediate, Inc. (5) (6) (8) L + 5.50% 6.25% 08/04/2021 08/04/2027 40,162 39,214 39,214 3.30 Govbrands Intermediate, Inc. (5) (8) (13) L + 5.50% 6.25% 08/04/2021 08/04/2027 9,059 8,795 8,795 0.74 Govbrands Intermediate, Inc. (5) (8) (13) L + 5.50% 6.25% 08/04/2021 08/04/2027 — (99) (99) (0.01) Recovery Point Systems, Inc. (5) (6) (7) L + 6.50% 7.50% 08/12/2020 08/12/2026 41,475 40,805 41,475 3.49 Recovery Point Systems, Inc. (5) (7) (13) L + 6.50% 7.50% 08/12/2020 08/12/2026 — (61) — 0.00 Syntax Systems Ltd (5) (8) (10) L + 5.50% 6.25% 10/29/2021 10/29/2028 35,811 35,460 35,460 2.98 Syntax Systems Ltd (5) (8) (10) (13) L + 5.50% 6.25% 10/29/2021 10/29/2028 — (91) (91) (0.01) Syntax Systems Ltd (5) (8) (10) (13) L + 5.50% 6.25% 10/29/2021 10/29/2026 1,637 1,601 1,601 0.13 Thrive Buyer, Inc. (Thrive Networks) (5) (6) (7) L + 6.00% 7.00% 02/01/2021 01/22/2027 20,770 20,402 20,402 1.72 Thrive Buyer, Inc. (Thrive Networks) (5) (7) (13) L + 6.00% 7.00% 02/01/2021 01/22/2027 8,031 7,763 7,763 0.65 Thrive Buyer, Inc. (Thrive Networks) (5) (7) (13) L + 6.00% 7.00% 02/01/2021 01/22/2027 — (35) (35) 0.00 Upstack Holdco, Inc. (5) (7) L + 6.00% 7.00% 08/26/2021 08/20/2027 9,844 9,609 9,635 0.81 Upstack Holdco, Inc. (5) (7) (13) L + 6.00% 7.00% 08/26/2021 08/20/2027 3,325 3,223 3,232 0.27 Upstack Holdco, Inc. (5) (7) (13) L + 6.00% 7.00% 08/26/2021 08/20/2027 — (23) (19) 0.00 201,890 202,960 17.08 Leisure Products GSM Acquisition Corp. (GSM Outdoors) (5) (6) (7) L + 5.00% 6.00% 11/16/2020 11/16/2026 47,701 47,196 47,701 4.01 GSM Acquisition Corp. (GSM Outdoors) (5) (7) (13) L + 5.00% 6.00% 11/16/2020 11/16/2026 7,199 7,096 7,199 0.61 54,292 54,900 4.62 Machinery Answer Target Holdco, LLC (5) (7) L + 6.00% 7.00% 12/30/2021 12/30/2026 10,827 10,611 10,611 0.89 Answer Target Holdco, LLC (5) (7) (13) L + 6.00% 7.00% 12/30/2021 12/30/2026 — (16) (16) 0.00 106 Table of Contents Morgan Stanley Direct Lending Fund Consolidated Schedule of Investments (continued) December 31, 2021 (In thousands) Investments-non-controlled/non-affiliated (1)(2) Footnotes Reference Rate and Spread Interest Rate (3) Acquisition Date Maturity Date Par Amount/ Shares Cost (4) Fair Value Percentage of Net Assets Komline-Sanderson Group, Inc. (5) (9) L + 6.00% 6.50% 12/30/2021 03/17/2026 16,798 $ 16,643 $ 16,462 1.39 % Komline-Sanderson Group, Inc. (5) (9) (13) L + 6.00% 6.50% 03/17/2021 03/17/2026 19,263 19,090 18,877 1.59 Komline-Sanderson Group, Inc. (5) (9) (13) L + 6.00% 6.50% 03/17/2021 03/17/2026 2,294 2,254 2,199 0.19 48,582 48,133 4.05 Multi-Utilities AWP Group Holdings, Inc. (5) (6) (7) L + 4.75% 5.75% 12/22/2020 12/22/2027 899 888 899 0.08 AWP Group Holdings, Inc. (5) (7) (13) L + 4.75% 5.75% 12/22/2020 12/22/2027 132 129 132 0.01 AWP Group Holdings, Inc. (5) (7) (13) L + 4.75% 5.75% 12/22/2020 12/22/2026 43 41 43 0.00 Ground Penetrating Radar Systems, LLC (5) (6) (7) L + 4.75% 5.75% 03/10/2021 06/26/2026 8,771 8,619 8,771 0.74 Ground Penetrating Radar Systems, LLC (5) (7) (13) L + 4.75% 5.75% 03/10/2021 06/26/2025 755 728 755 0.06 10,405 10,600 0.89 Professional Services Abacus Data Holdings, Inc. (AbacusNext) (5) (6) (7) L + 6.25% 7.25% 03/17/2021 03/10/2027 18,806 18,428 18,806 1.58 Abacus Data Holdings, Inc. (AbacusNext) (5) (7) (13) L + 6.25% 7.25% 03/17/2021 03/10/2027 — (34) — 0.00 Abacus Data Holdings, Inc. (AbacusNext) (5) (7) (13) L + 6.25% 7.25% 03/17/2021 03/10/2027 210 181 210 0.02 Bullhorn, Inc. (5) (6) (7) L + 5.75% 6.75% 09/11/2020 09/30/2026 9,675 9,573 9,629 0.81 Bullhorn, Inc. (5) (7) (13) L + 5.75% 6.75% 10/05/2021 09/30/2026 — (25) (25) 0.00 Bullhorn, Inc. (5) (7) (13) L + 5.75% 6.75% 09/11/2020 09/30/2026 — (6) (3) 0.00 Citrin Cooperman Advisors, LLC (5) (8) L + 5.00% 5.75% 01/10/2021 10/01/2027 20,176 19,787 19,787 1.66 Citrin Cooperman Advisors, LLC (5) (8) (13) L + 5.00% 5.75% 01/10/2021 10/01/2027 — (83) (83) (0.01) Citrin Cooperman Advisors, LLC (5) (8) (13) L + 5.00% 5.75% 01/10/2021 10/01/2027 — (469) (469) (0.04) IQN Holding Corp., dba Beeline (5) (6) (7) L + 5.50% 6.50% 02/10/2020 08/20/2024 44,355 44,205 44,355 3.73 IQN Holding Corp., dba Beeline (5) (7) (13) L + 5.50% 6.50% 02/10/2020 08/21/2023 — (10) — 0.00 91,547 92,207 7.76 Real Estate Management & Development Associations, Inc. (5) (6) (7) L + 4.00%; 2.50% PIK 7.50% 07/09/2021 07/02/2027 15,853 15,706 15,853 1.33 Associations, Inc. (5) (7) (13) L + 4.00%; 2.50% PIK 7.50% 07/09/2021 07/02/2027 2,723 2,698 2,723 0.23 Associations, Inc. (5) (7) (13) L + 6.50% 7.50% 07/09/2021 07/02/2027 11,187 11,083 11,187 0.94 Associations, Inc. (5) (7) (13) L + 6.50% 7.50% 07/09/2021 07/02/2027 — (17) — 0.00 MRI Software, LLC (5) (7) L + 5.50% 6.50% 01/22/2021 02/10/2026 49,090 48,603 49,090 4.13 107 Table of Contents Morgan Stanley Direct Lending Fund Consolidated Schedule of Investments (continued) December 31, 2021 (In thousands) Investments-non-controlled/non-affiliated (1)(2) Footnotes Reference Rate and Spread Interest Rate (3) Acquisition Date Maturity Date Par Amount/ Shares Cost (4) Fair Value Percentage of Net Assets MRI Software, LLC (5) (6) (7) (13) L + 5.50% 6.50% 03/24/2021 02/10/2026 362 $ 338 $ 362 0.03 % MRI Software, LLC (5) (7) (13) L + 5.50% 6.50% 03/24/2021 02/10/2026 — (15) — 0.00 Zarya Intermediate, LLC (5) (6) (7) L + 6.50% 7.50% 07/01/2021 07/01/2027 24,500 24,043 24,500 2.06 Zarya Intermediate, LLC (5) (7) (13) L + 6.50% 7.50% 07/01/2021 07/01/2027 19,250 18,884 19,250 1.62 Zarya Intermediate, LLC (5) (7) (13) L + 6.50% 7.50% 07/01/2021 07/01/2027 — (86) — 0.00 121,237 122,965 10.35 Software Alert Media, Inc. (5) (6) (7) L + 5.00% 6.00% 04/12/2021 04/12/2027 14,000 13,811 13,657 1.15 Alert Media, Inc. (5) (7) (13) L + 5.00% 6.00% 04/12/2021 04/10/2026 — (22) (43) 0.00 Appfire Technologies, LLC (5) (7) L + 5.50% 6.50% 10/04/2021 03/09/2027 4,663 4,643 4,663 0.39 Appfire Technologies, LLC (5) (7) (13) L + 5.50% 6.50% 07/07/2021 03/09/2027 — (59) — 0.00 Assembly Intermediate, LLC (5) (7) L + 7.00% 8.00% 10/19/2021 10/19/2027 20,741 20,337 20,337 1.71 Assembly Intermediate, LLC (5) (7) (13) L + 7.00% 8.00% 10/19/2021 10/19/2027 1,244 1,182 1,182 0.10 Assembly Intermediate, LLC (5) (7) (13) L + 7.00% 8.00% 10/19/2021 10/19/2027 — (40) (40) 0.00 CLEO Communications Holding, LLC (5) (6) (7) L + 6.75% 7.75% 06/09/2021 06/09/2027 39,998 39,628 39,366 3.31 CLEO Communications Holding, LLC (5) (7) (13) L + 6.75% 7.75% 06/09/2021 06/09/2027 — (113) (197) (0.02) Cordeagle US Finco, Inc. (5) (7) (10) L + 6.75% 7.75% 07/30/2021 07/30/2027 18,200 17,856 18,200 1.53 Cordeagle US Finco, Inc. (5) (7) (10) (13) L + 6.75% 7.75% 07/30/2021 07/30/2027 — (52) — 0.00 Diligent Corporation (5) (6) (7) L + 5.75% 6.75% 03/04/2021 08/04/2025 27,790 27,555 27,790 2.34 Diligent Corporation (5) (6) (7) (13) L + 5.75% 6.75% 03/30/2021 08/04/2025 860 826 860 0.07 Diligent Corporation (5) (7) (13) L + 5.75% 6.75% 03/30/2021 08/04/2025 — (37) — 0.00 GS AcquisitionCo, Inc. (5) (6) (7) L + 5.75% 6.75% 10/05/2021 05/22/2026 69,710 69,108 69,361 5.84 GS AcquisitionCo, Inc. (5) (7) (13) L + 5.75% 6.75% 07/10/2021 05/22/2026 — (26) (54) 0.00 GS AcquisitionCo, Inc. (5) (7) (13) L + 5.75% 6.75% 10/27/2020 05/22/2026 1,149 1,125 1,137 0.10 Gurobi Optimization, LLC (5) (6) (7) L + 5.00% 6.00% 11/12/2020 12/19/2023 13,226 13,139 13,226 1.11 Gurobi Optimization, LLC (5) (7) (13) L + 5.00% 6.00% 11/12/2020 12/19/2023 — (10) — 0.00 Pound Bidco, Inc. (5) (6) (7) (10) L + 6.50% 7.50% 01/28/2021 01/30/2026 9,012 8,854 8,854 0.74 Pound Bidco, Inc. (5) (6) (7) (10) (13) L + 6.50% 7.50% 01/28/2021 01/30/2026 — (19) (19) 0.00 Revalize, Inc. (5) (7) (13) L + 5.25% 6.25% 12/15/2021 04/15/2027 19,715 19,570 19,512 1.64 Revalize, Inc. (5) (7) (13) L + 5.25% 6.25% 12/02/2021 04/15/2027 — (1) (1) 0.00 108 Table of Contents Morgan Stanley Direct Lending Fund Consolidated Schedule of Investments (continued) December 31, 2021 (In thousands) Investments-non-controlled/non-affiliated (1)(2) Footnotes Reference Rate and Spread Interest Rate (3) Acquisition Date Maturity Date Par Amount/ Shares Cost (4) Fair Value Percentage of Net Assets Skykick, Inc. (5) (7) L + 7.25% 8.25% 09/01/2021 09/01/2027 6,300 $ 6,149 $ 6,149 0.52 % Skykick, Inc. (5) (7) (13) L + 7.25% 8.25% 09/01/2021 09/01/2027 — (31) (31) 0.00 Trunk Acquisition, Inc. (5) (7) L + 6.00% 7.00% 12/27/2021 02/19/2027 9,143 9,052 9,052 0.76 Trunk Acquisition, Inc. (5) (7) (13) L + 6.00% 7.00% 12/27/2021 02/19/2026 — (9) (9) 0.00 252,416 252,952 21.28 Total First Lien Debt $ 2,213,332 $ 2,224,100 187.12 % Second Lien Debt Auto Components PAI Holdco, Inc. (5) (7) L + 5.50%, 2.00% PIK 8.50% 01/28/2021 10/28/2028 25,509 $ 24,843 $ 25,509 2.15 % Electronic Equipment, Instruments & Components Infinite Bidco, LLC (5) (9) L + 7.00% 7.50% 02/24/2021 03/02/2029 17,000 16,931 17,000 1.43 Infinite Bidco, LLC (5) (9) (13) L + 7.00% 7.50% 03/18/2021 03/02/2029 — (19) — 0.00 16,912 17,000 1.43 Energy Equipment & Services QBS Parent, Inc. (5) L + 8.50% 8.72% 02/10/2021 09/21/2026 15,000 14,769 14,748 1.24 Health Care Providers & Services Heartland Veterinary Partners, LLC (5) (7) L + 8.00% 9.00% 11/17/2021 12/10/2027 3,960 3,881 3,882 0.33 Heartland Veterinary Partners, LLC (5) (7) (13) L + 8.00% 9.00% 11/17/2021 12/10/2027 585 574 574 0.05 4,455 4,456 0.37 Industrial Conglomerates Aptean, Inc. (5) (8) L + 7.00% 7.75% 04/22/2021 04/23/2027 5,950 5,950 5,950 0.50 IT Services Help/Systems Holdings, Inc. (5) (8) L + 6.75% 7.50% 05/11/2021 11/19/2027 17,500 17,500 17,500 1.47 Idera, Inc. (5) (8) L + 6.75% 7.50% 02/04/2021 03/02/2029 3,887 3,860 3,887 0.33 Red Dawn SEI Buyer, Inc. (5) (7) L + 8.50% 9.50% 01/27/2021 11/20/2026 19,000 18,584 19,000 1.60 39,944 40,387 3.40 Software Flexera Software, LLC (5) (7) L + 7.00% 8.00% 03/03/2021 03/03/2029 13,500 13,251 13,500 1.14 Total Second Lien Debt $ 120,124 $ 121,550 10.23 % 109 Table of Contents Morgan Stanley Direct Lending Fund Consolidated Schedule of Investments (continued) December 31, 2021 (In thousands) Investments-non-controlled/non-affiliated (1)(2) Footnotes Reference Rate and Spread Interest Rate (3) Acquisition Date Maturity Date Par Amount/ Shares Cost (4) Fair Value Percentage of Net Assets Other Securities Unsecured Debt Familia Intermediate Holdings I Corp. (Teasdale Latin Foods) (5) (11) 16.25% PIK 12/18/2020 06/18/2026 1,800 $ 1,777 $ 1,350 0.11 % Total Unsecured Debt 1,777 1,350 0.11 Preferred Equity Diligent Corporation (5) (12) 10.50% 04/05/2021 5,000 5,143 5,295 0.45 Integrity Marketing Acquisition, LLC (5) (12) 10.50% 12/22/2021 3,250,000 3,185 3,185 0.27 Revalize, Inc. (5) (12) 11.00% 12/14/2021 1,500 1,470 1,470 0.12 Skykick, Inc. (5) (12) 08/31/2021 134,101 1,275 1,298 0.11 Total Preferred Equity 11,073 11,248 0.95 Common Equity Abacus Data Holdings, Inc. (AbacusNext) (5) (12) 07/12/2021 29,441 2,944 2,714 0.23 BP Purchaser, LLC (5) (12) 12/10/2021 1,233,333 1,233 1,233 0.10 CSC Thrive Holdings, LP (Thrive Networks) (5) (12) 03/01/2021 160,016 411 531 0.04 Encore Holdings, LLC (5) (12) 11/23/2021 2,391 275 275 0.02 GSM Equity Investors, LP (GSM Outdoors) (5) (12) 11/16/2020 4,500 450 1,242 0.10 Help HP SCF Investor, LP (10) (12) 05/12/2021 12,460 13,751 1.16 mPulse Mobile, Inc. (5) (12) 12/17/2021 165,761 1,220 1,220 0.10 PCX Holding Corp. (5) (12) 04/22/2021 6,538 654 965 0.08 Pet Holdings, Inc. (Brightpet) (5) (12) 10/06/2020 12,313 1,232 1,052 0.09 Pritchard Industries, Inc. (5) (12) 10/13/2021 1,700,000 1,700 1,700 0.14 Procure Acquiom Financial, LLC (Procure Analytics) (5) (12) 12/20/2021 1,000,000 1,000 1,000 0.08 RPS Group Holdings (Recovery Point Systems, Inc.) (5) (12) 03/05/2021 1,000,000 1,000 750 0.06 Shelby Co-invest, LP. (Spectrum Automotive) (5) (12) 06/29/2021 8,500 850 993 0.08 Suveto Buyer, LLC (5) (10) (12) 11/19/2021 17,000 1,700 1,700 0.14 Total Common Equity 27,129 29,126 2.45 Total Other Securities $ 39,979 $ 41,724 3.51 % Total Portfolio Investments $ 2,373,435 $ 2,387,374 200.86 % 110 Table of Contents Morgan Stanley Direct Lending Fund Consolidated Schedule of Investments (continued) December 31, 2021 (In thousands) (1) Unless otherwise indicated, issuers of debt and equity investments held by the Company (which such term “Company” shall include the Company’s consolidated subsidiaries for purposes of this Consolidated Schedule of Investments) are denominated in dollars. All debt investments are income producing unless otherwise indicated. All equity investments are non-income producing unless otherwise noted. Certain portfolio company investments are subject to contractual restrictions on sales. Under the Investment Company Act of 1940, as amended (together with the rules and regulations promulgated thereunder, the “1940 Act”), the Company would be deemed to “control” a portfolio company if the Company owned more than 25% of its outstanding voting securities and/or held the power to exercise control over the management or policies of the portfolio company. As of December 31, 2021, the Company does not “control” any of these portfolio companies. Under the 1940 Act, the Company would be deemed an “affiliated person” of a portfolio company if the Company owns 5% or more of the portfolio company’s outstanding voting securities. As of December 31, 2021, the Company is not an “affiliated person” of any of its portfolio companies. (2) Unless otherwise indicated, the Company’s investments are pledged as collateral supporting the amounts outstanding under the Truist Credit Facility (as defined below). See Note 6 "Debt". (3) Variable rate loans to the portfolio companies bear interest at a rate that is determined by reference to either LIBOR (“L”) or an alternate base rate (commonly based on the Federal Funds Rate (“F”) or the U.S. Prime Rate (“P”)), which generally resets periodically. For each loan, the Company has indicated the reference rate used and provided the spread and the interest rate in effect as of December 31, 2021. For investments with multiple reference rates or alternate base rates, the interest rate shown is the weighted average interest rate in effect at December 31, 2021. As of December 31, 2021, the reference rates for our variable rate loans were the 30-day L at 0.10%, the 90-day L at 0.21%, the 180-day L at 0.34%, and the P at 3.25%. (4) The cost represents the original cost adjusted for the amortization of discounts and premiums, as applicable, on debt investments using the effective interest method. (5) These investments were valued using unobservable inputs and are considered Level 3 investments. Fair value was determined in good faith by or under the direction of the Board of Directors (see Note 2 and Note 5), pursuant to the Company’s valuation policy. (6) Assets or a portion thereof are pledged as collateral for the BNP Funding Facility. See Note 6 “Debt”. (7) Loan includes interest rate floor of 1.00%. (8) Loan includes interest rate floor of 0.75%. (9) Loan includes interest rate floor of 0.50%. (10) The investment is not a qualifying asset under Section 55(a) of the 1940 Act. The Company may not acquire any non-qualifying asset unless, at the time of acquisition, qualifying assets represent at least 70% of the Company’s total assets. As of December 31, 2021, non-qualifying assets represented 5.7% of total assets as calculated in accordance with regulatory requirements. (11) Represents a senior unsecured note, which is subordinated to senior secured term loans of the portfolio company. (12) Securities exempt from registration under the Securities Act of 1933, and may be deemed to be “restricted securities”. As of December 31, 2021, the aggregate fair value of these securities is $40,374 or 3.4% of the Company’s net assets. The initial acquisition dates have been included for such securities. (13) Position or portion thereof is an unfunded loan commitment, and no interest is being earned on the unfunded portion, although the investment may earn unused commitment fees. Negative cost and fair value, if any, results from unamortized fees, which are capitalized to the cost of the investment. The unfunded loan commitment may be subject to a commitment termination date that may expire prior to the maturity date stated. See below for more information on the Company’s unfunded commitments as of December 31, 2021: Investments-non-controlled/non-affiliated Unused Fee Rate Commitment Type Commitment Expiration Date Unfunded Commitment Fair Value First Lien Debt 365 Retail Markets, LLC 1.00% Delayed Draw Term Loan 11/05/2023 $ 5,557 $ (34) 365 Retail Markets, LLC 0.50% Revolver 12/23/2026 2,000 (25) Abacus Data Holdings, Inc. (AbacusNext) 1.00% Delayed Draw Term Loan 09/08/2022 3,500 — Abacus Data Holdings, Inc. (AbacusNext) 0.50% Revolver 03/10/2027 1,190 — Alert Media, Inc. 0.50% Revolver 04/10/2026 1,750 (43) AMCP Pet Holdings, Inc. (Brightpet) 1.00% Delayed Draw Term Loan 04/06/2022 5,000 (44) AMCP Pet Holdings, Inc. (Brightpet) 0.50% Revolver 10/05/2026 1,896 (17) Answer Target Holdco, LLC 0.50% Revolver 12/30/2026 833 (17) Appfire Technologies, LLC 0.50% Delayed Draw Term Loan 01/05/2023 13,525 — ARI Network Services, Inc. 0.50% Revolver 02/28/2025 1,697 (13) Assembly Intermediate, LLC 1.00% Delayed Draw Term Loan 10/19/2023 3,941 (47) Assembly Intermediate, LLC 0.50% Revolver 10/19/2027 2,074 (40) 111 Table of Contents Morgan Stanley Direct Lending Fund Consolidated Schedule of Investments (continued) December 31, 2021 (In thousands) Investments-non-controlled/non-affiliated Unused Fee Rate Commitment Type Commitment Expiration Date Unfunded Commitment Fair Value Associations, Inc. 0.50% Revolver 07/02/2027 $ 1,860 $ — AWP Group Holdings, Inc. 1.00% Delayed Draw Term Loan 12/22/2022 132 — AWP Group Holdings, Inc. 0.50% Revolver 12/22/2026 114 — Bearcat Buyer, Inc. 1.00% Delayed Draw Term Loan 11/23/2022 513 — Bullhorn, Inc. 0.50% Delayed Draw Term Loan 10/05/2022 5,172 (25) Bullhorn, Inc. 0.50% Revolver 09/30/2026 554 (3) Capstone Acquisition Holdings, Inc. 1.00% Delayed Draw Term Loan 05/13/2022 313 — CC SAG Holdings Corp. (Spectrum Automotive) 1.00% Delayed Draw Term Loan 06/29/2023 4,437 (52) CC SAG Holdings Corp. (Spectrum Automotive) 0.50% Revolver 06/29/2027 881 (10) Citrin Cooperman Advisors, LLC 1.00% Delayed Draw Term Loan 10/01/2023 8,647 (83) Citrin Cooperman Advisors, LLC 0.50% Revolver 10/01/2027 24,500 (469) CLEO Communications Holding, LLC 0.50% Revolver 06/09/2027 12,502 (198) Cordeagle US Finco, Inc. 0.50% Revolver 07/30/2027 2,800 — DCA Investment Holdings, LLC 1.00% Delayed Draw Term Loan 03/12/2023 1,689 — Diligent Corporation 1.00% Delayed Draw Term Loan 10/05/2022 3,136 — Diligent Corporation 0.50% Revolver 08/04/2025 4,500 — Electrical Source Holdings, LLC 0.50% Revolver 11/25/2025 896 — Encore Holdings, LLC 0.75% Delayed Draw Term Loan 11/23/2024 3,081 (30) Encore Holdings, LLC 0.50% Revolver 11/23/2027 539 (9) FLS Holding, Inc. 1.00% Delayed Draw Term Loan 06/17/2023 6,250 (62) FLS Holding, Inc. 0.50% Revolver 12/17/2027 2,500 (50) FMG Suite Holdings, LLC 0.50% Delayed Draw Term Loan 10/28/2022 5,250 (19) FMG Suite Holdings, LLC 0.50% Revolver 10/30/2026 2,625 (10) Fortis Solutions Group, LLC 0.50% Delayed Draw Term Loan 10/15/2023 7,871 (76) Fortis Solutions Group, LLC 0.50% Revolver 10/15/2027 2,699 (52) Foundation Risk Partners, Corp. 1.00% Delayed Draw Term Loan 10/29/2023 4,033 (47) Foundation Risk Partners, Corp. 0.50% Revolver 10/29/2027 4,571 (67) Galway Borrower, LLC 0.50% Delayed Draw Term Loan 09/30/2023 4,311 (75) Galway Borrower, LLC 0.50% Revolver 09/30/2027 2,053 (36) Govbrands Intermediate, Inc. 1.00% Delayed Draw Term Loan 08/04/2023 4,185 (83) Govbrands Intermediate, Inc. 0.50% Revolver 08/04/2027 4,237 (99) GraphPad Software, LLC 0.50% Revolver 04/27/2027 1,750 (16) Ground Penetrating Radar Systems, LLC 0.50% Revolver 06/26/2025 886 — GS AcquisitionCo, Inc. 0.50% Delayed Draw Term Loan 11/03/2022 10,833 (54) GS AcquisitionCo, Inc. 0.50% Revolver 05/22/2026 1,270 (6) GSM Acquisition Corp. (GSM Outdoors) 0.50% Revolver 11/16/2026 1,617 — Gurobi Optimization, LLC 0.50% Revolver 12/19/2023 1,607 — Heartland Veterinary Partners, LLC 0.75% Delayed Draw Term Loan 11/17/2023 3,816 (37) 112 Table of Contents Morgan Stanley Direct Lending Fund Consolidated Schedule of Investments (continued) December 31, 2021 (In thousands) Investments-non-controlled/non-affiliated Unused Fee Rate Commitment Type Commitment Expiration Date Unfunded Commitment Fair Value Heartland Veterinary Partners, LLC 0.50% Revolver 12/10/2026 $ 375 $ (4) High Street Buyer, Inc. 1.00% Delayed Draw Term Loan 08/11/2023 3,385 — High Street Buyer, Inc. 0.50% Revolver 04/16/2027 2,136 — Integrity Marketing Acquisition, LLC 1.00% Delayed Draw Term Loan 12/03/2023 3,056 (38) IQN Holding Corp., dba Beeline 0.50% Revolver 08/21/2023 4,545 — Keystone Agency Investors 1.00% Delayed Draw Term Loan 12/21/2023 2,578 (38) Komline-Sanderson Group, Inc. 0.50% Revolver 03/17/2026 2,452 (49) KPSKY Acquisition, Inc. —% Delayed Draw Term Loan 10/19/2023 1,980 (29) KWOR Acquisition, Inc. 0.50% Revolver 12/22/2027 110 (2) Lightspeed Buyer, Inc. 1.00% Delayed Draw Term Loan 02/28/2023 4,050 (180) Majesco 0.50% Revolver 09/21/2026 1,575 — Mammoth Holdings, LLC 0.50% Delayed Draw Term Loan 12/15/2022 7,434 — Mammoth Holdings, LLC 0.50% Revolver 10/16/2023 953 — MHE Intermediate Holdings, LLC 1.00% Delayed Draw Term Loan 07/21/2023 1,585 (16) MHE Intermediate Holdings, LLC 0.50% Revolver 07/21/2027 2,500 (25) mPulse Mobile, Inc. 0.50% Delayed Draw Term Loan 12/17/2023 1,996 (20) mPulse Mobile, Inc. 0.50% Revolver 12/17/2027 504 (10) MRI Software, LLC 0.50% Delayed Draw Term Loan 03/24/2023 10,637 — MRI Software, LLC 0.50% Revolver 02/10/2026 2,215 — MSM Acquisitions, Inc. 1.00% Delayed Draw Term Loan 01/30/2023 26,515 (265) MSM Acquisitions, Inc. 0.50% Revolver 12/09/2026 3,582 (36) Omni Intermediate Holdings, LLC 1.00% Delayed Draw Term Loan 12/01/2023 1,264 (6) Omni Intermediate Holdings, LLC 0.50% Revolver 12/30/2025 799 (8) Patriot Growth Insurance Services, LLC 0.75% Delayed Draw Term Loan 10/14/2023 17,620 (171) Patriot Growth Insurance Services, LLC 0.75% Revolver 10/14/2027 4,485 (86) PCX Holding Corp. 1.00% Delayed Draw Term Loan 04/22/2023 1,851 — PCX Holding Corp. 0.50% Revolver 04/22/2027 1,851 — PDFTron US Acquisition Corp. 1.00% Delayed Draw Term Loan 01/15/2023 3,640 (98) PDFTron US Acquisition Corp. 0.50% Revolver 07/15/2026 7,700 (208) Peter C. Foy & Associates Insurance Services, LLC 1.00% Delayed Draw Term Loan 05/02/2023 1,559 (13) Peter C. Foy & Associates Insurance Services, LLC 0.50% Revolver 11/01/2027 832 (8) Pound Bidco, Inc. 0.50% Revolver 01/30/2026 1,163 (19) Pritchard Industries, LLC 1.00% Delayed Draw Term Loan 10/13/2023 6,140 (59) Procure Acquireco, Inc. (Procure Analytics) 0.50% Delayed Draw Term Loan 12/20/2023 794 (8) Procure Acquireco, Inc. (Procure Analytics) 0.50% Revolver 12/20/2028 238 (5) Promptcare Infusion Buyer, Inc. 1.00% Delayed Draw Term Loan 09/01/2023 3,050 (72) PT Intermediate Holdings III, LLC —% Delayed Draw Term Loan 05/11/2022 16,090 — Recovery Point Systems, Inc. 0.50% Revolver 08/12/2026 4,000 — 113 Table of Contents Morgan Stanley Direct Lending Fund Consolidated Schedule of Investments (continued) December 31, 2021 (In thousands) Investments-non-controlled/non-affiliated Unused Fee Rate Commitment Type Commitment Expiration Date Unfunded Commitment Fair Value Revalize, Inc. 0.50% Delayed Draw Term Loan 06/13/2023 $ 708 $ (7) Revalize, Inc. 0.50% Revolver 04/15/2027 71 (1) RSC Acquisition, Inc. 0.50% Delayed Draw Term Loan 11/12/2023 8,474 (82) Sherlock Buyer Corp. 0.50% Delayed Draw Term Loan 12/08/2023 3,215 (32) Sherlock Buyer Corp. 0.50% Revolver 12/08/2027 1,286 (25) Skykick, Inc. 1.00% Delayed Draw Term Loan 03/01/2023 2,625 (31) Sonny’s Enterprises, Inc. 1.00% Delayed Draw Term Loan 11/01/2022 21,225 (410) Summit Buyer, LLC 1.00% Delayed Draw Term Loan 06/23/2023 13,656 (108) Summit Buyer, LLC 0.50% Revolver 01/14/2026 2,420 (19) Suveto Buyer, LLC 1.00% Delayed Draw Term Loan 09/09/2023 8,442 (78) Suveto Buyer, LLC 0.50% Revolver 09/09/2027 707 (7) Sweep Purchaser, LLC 0.50% Revolver 11/30/2026 956 (16) Syntax Systems Ltd 1.00% Delayed Draw Term Loan 10/29/2023 9,356 (91) Syntax Systems Ltd 0.50% Revolver 10/29/2026 2,106 (20) Thrive Buyer, Inc. (Thrive Networks) 1.00% Delayed Draw Term Loan 12/30/2023 6,442 (123) Thrive Buyer, Inc. (Thrive Networks) 0.50% Revolver 01/22/2027 1,982 (35) Triple Lift, Inc. 0.50% Revolver 05/08/2028 4,000 (37) Trunk Acquisition, Inc. 0.50% Revolver 02/19/2026 857 (8) Turbo Buyer, Inc. 1.00% Delayed Draw Term Loan 11/15/2023 1,610 (31) Two Six Labs, LLC 0.50% Delayed Draw Term Loan 08/20/2023 4,268 (43) Two Six Labs, LLC 0.50% Revolver 08/20/2027 2,134 (21) United Flow Technologies Intermediate Holdco II, LLC 1.00% Delayed Draw Term Loan 10/29/2023 7,500 (73) United Flow Technologies Intermediate Holdco II, LLC 0.50% Revolver 10/29/2026 3,000 (58) Upstack Holdco, Inc. 1.00% Delayed Draw Term Loan 08/26/2023 1,050 (22) Upstack Holdco, Inc. 0.50% Revolver 08/20/2027 875 (18) US Infra Svcs Buyer, LLC 1.00% Delayed Draw Term Loan 04/13/2022 8,085 (42) US Infra Svcs Buyer, LLC 0.50% Revolver 04/13/2026 225 (1) Valcourt Holdings II, LLC 1.00% Delayed Draw Term Loan 01/07/2023 4,378 — Vehlo Purchaser, LLC 1.00% Delayed Draw Term Loan 08/27/2023 11,569 (183) Vehlo Purchaser, LLC 0.50% Revolver 08/27/2027 4,666 (74) Vessco Midco Holdings, LLC 1.00% Delayed Draw Term Loan 11/02/2022 309 — Vessco Midco Holdings, LLC 0.50% Revolver 10/18/2026 427 — VRC Companies, LLC 0.75% Delayed Draw Term Loan 12/28/2022 5,000 (42) VRC Companies, LLC 0.50% Revolver 06/29/2027 1,653 (14) World Insurance Associates, LLC 0.50% Revolver 04/01/2026 1,173 (23) Zarya Intermediate, LLC 0.50% Revolver 07/01/2027 1,983 — Zarya Intermediate, LLC 0.50% Revolver 07/01/2027 2,683 — Total First Lien Debt Unfunded Commitments $ 499,948 $ (5,196) 114 Table of Contents Morgan Stanley Direct Lending Fund Consolidated Schedule of Investments (continued) December 31, 2021 (In thousands) Investments-non-controlled/non-affiliated Unused Fee Rate Commitment Type Commitment Expiration Date Unfunded Commitment Fair Value Second Lien Debt Heartland Veterinary Partners, LLC 0.75% Delayed Draw Term Loan 11/17/2023 $ 955 $ (7) Infinite Bidco, LLC 1.00% Delayed Draw Term Loan 03/02/2022 8,500 — Total Second Lien Debt Unfunded Commitments $ 9,455 $ (7) Total Unfunded Commitments $ 509,403 $ (5,203) 115 Morgan Stanley Direct Lending Fund Consolidated Schedule of Investments December 31, 2020 (In thousands) Investments-non-controlled/non-affiliated (1) Footnotes Reference Rate and Spread Interest Rate (2) Acquisition Date Maturity Date Par Amount/ Shares Cost (3) Fair Value Percentage of Net Assets First Lien Debt Auto Components Sonny’s Enterprises, Inc. (4) (5) L + 7.00% 8.00% 12/28/2020 08/05/2026 5,469 $ 5,360 $ 5,360 1.78 % Sonny’s Enterprises, Inc. (4) (5) (10) L + 7.00% 8.00% 12/28/2020 08/05/2026 — (266) (266) (0.09) 5,094 5,094 1.69 Automobiles Turbo Buyer, Inc. (4) (5) (10) L + 5.50% 6.50% 08/21/2020 02/12/2025 — (407) (407) (0.13) Commercial Services & Supplies Capstone Acquisition Holdings, Inc. (5) (6) L + 4.75% 5.75% 11/13/2020 11/12/2027 2,827 2,799 2,845 0.94 Capstone Acquisition Holdings, Inc. (5) (10) L + 4.75% 5.75% 11/13/2020 11/12/2027 — (2) 3 — Divisions Holding Corporation (4) (5) L + 6.50% 7.50% 08/14/2020 08/14/2026 29,491 28,931 29,491 9.78 Divisions Holding Corporation (4) (5) (10) L + 6.50% 7.50% 08/14/2020 08/14/2026 1,739 1,593 1,739 0.58 Sweep Purchaser LLC (4) (5) L + 5.75% 6.75% 11/30/2020 11/30/2026 8,859 8,684 8,684 2.88 Sweep Purchaser LLC (4) (5) (10) L + 5.75% 6.75% 11/30/2020 11/30/2026 — (28) (28) (0.01) Sweep Purchaser LLC (4) (5) (10) L + 5.75% 6.75% 11/30/2020 11/30/2026 — (28) (28) (0.01) US Infra Svcs Buyer LLC (4) (5) L + 6.00% 7.00% 04/10/2020 04/13/2026 17,164 16,854 17,164 5.69 US Infra Svcs Buyer LLC (4) (5) (10) L + 6.00% 7.00% 04/10/2020 04/13/2026 988 802 988 0.33 US Infra Svcs Buyer LLC (4) (5) (10) L + 6.00% 7.00% 04/10/2020 04/13/2026 300 260 300 0.10 Vessco Midco Holdings LLC (4) (5) (6) L + 4.50% 5.50% 10/30/2020 11/02/2026 2,763 2,736 2,736 0.91 Vessco Midco Holdings LLC (4) (5) (10) L + 4.50% 5.50% 10/30/2020 11/02/2026 134 117 117 0.04 Vessco Midco Holdings LLC (4) (5) (10) L + 4.50% 5.50% 10/30/2020 10/18/2026 — (4) (4) 0.00 62,714 64,007 21.22 Containers & Packaging Brook and Whittle Holding Corp. (4) (5) L + 6.00% 7.00% 10/27/2020 10/17/2024 12,916 12,730 12,730 4.22 Diversified Financial Services HighTower Holdings LLC (4) (5) (7) L + 5.00% 6.00% 10/14/2020 01/31/2025 12,549 12,368 12,368 4.10 HighTower Holdings LLC (4) (5) (7) (10) L + 5.00% 6.00% 10/14/2020 01/31/2025 — (17) (17) (0.01) 12,351 12,351 4.09 Food Products AMCP Pet Holdings, Inc. (Brightpet) (4) (5) (6) L + 6.25% 7.25% 10/06/2020 10/05/2026 17,500 16,990 16,990 5.63 AMCP Pet Holdings, Inc. (Brightpet) (4) (5) L + 6.25% 7.25% 12/29/2020 10/05/2026 16,667 16,167 16,167 5.36 AMCP Pet Holdings, Inc. (Brightpet) (4) (5) (10) L + 6.25% 7.25% 10/06/2020 10/01/2027 — (144) (144) (0.05) AMCP Pet Holdings, Inc. (Brightpet) (4) (5) (10) L + 6.25% 7.25% 10/06/2020 10/01/2025 — (172) (172) (0.06) Nellson Nutraceutical, Inc. (4) (5) (6) L + 5.25% 6.25% 09/30/2020 12/23/2023 17,623 17,295 17,623 5.84 Nellson Nutraceutical, Inc. (4) (5) (6) L + 5.25% 6.25% 09/30/2020 12/23/2023 7,246 7,111 7,246 2.40 116 Morgan Stanley Direct Lending Fund Consolidated Schedule of Investments (continued) December 31, 2020 (In thousands) Investments-non-controlled/non-affiliated (1) Footnotes Reference Rate and Spread Interest Rate (2) Acquisition Date Maturity Date Par Amount/ Shares Cost (3) Fair Value Percentage of Net Assets Teasdale Foods, Inc. (Teasdale Latin Foods) (4) (5) L + 6.25% 7.25% 12/18/2020 12/18/2025 11,250 $ 11,027 $ 11,027 3.66 % 68,274 68,737 22.79 Health Care Providers & Services Bearcat Buyer, Inc. (4) (5) L + 4.75% 5.75% 11/18/2020 07/09/2026 6,912 6,741 6,741 2.23 Bearcat Buyer, Inc. (4) (5) (10) L + 4.75% 5.75% 11/18/2020 07/09/2026 1,425 1,256 1,256 0.42 7,997 7,997 2.65 Health Care Technology Lightspeed Buyer, Inc. (4) (5) (6) L + 5.50% 6.50% 11/09/2020 02/03/2026 9,375 9,100 9,100 3.02 Lightspeed Buyer, Inc. (4) (5) (10) L + 5.50% 6.50% 11/09/2020 02/03/2026 — (182) (182) (0.06) 8,918 8,918 2.96 Industrial Conglomerates Aptean, Inc. (4) (5) (6) L + 5.25% 6.25% 06/30/2020 04/23/2026 1,990 1,962 1,990 0.66 Electrical Source Holdings LLC (4) (5) (6) L + 5.50% 6.50% 05/18/2020 11/25/2025 29,850 29,580 29,850 9.90 31,542 31,840 10.56 Insurance Higginbotham Insurance Agency, Inc. (4) (8) L + 5.75% 6.50% 11/25/2020 11/25/2026 14,632 14,415 14,415 4.78 Higginbotham Insurance Agency, Inc. (4) (8) (10) L + 5.75% 6.50% 11/25/2020 11/25/2026 — (30) (30) (0.01) Integrity Marketing Acquisition LLC (4) (5) (10) L + 6.25% 7.25% 08/07/2020 08/27/2025 29,386 28,763 29,386 9.74 Majesco (4) (5) L + 7.75% 8.75% 09/21/2020 09/21/2027 14,852 14,420 14,852 4.92 Majesco (4) (5) (10) L + 7.75% 8.75% 09/21/2020 09/21/2026 — (45) — — Propel Insurance Agency LLC (4) (5) L + 5.00% 6.00% 12/09/2020 06/01/2024 18,427 18,245 18,245 6.05 Propel Insurance Agency LLC (4) (5) (10) L + 5.00% 6.00% 12/09/2020 06/01/2024 — (19) (19) (0.01) RSC Acquisition, Inc. (4) (5) (6) L + 5.50% 6.50% 09/11/2020 10/30/2026 2,938 2,853 2,938 0.97 RSC Acquisition, Inc. (4) (5) (10) L + 5.50% 6.50% 09/11/2020 10/30/2026 703 357 703 0.23 World Insurance Associates LLC (4) (5) L + 5.50% 6.50% 05/22/2020 04/01/2026 10,269 9,658 9,966 3.30 World Insurance Associates LLC (4) (5) L + 5.50% 6.50% 05/22/2020 04/01/2026 4,679 4,404 4,541 1.51 World Insurance Associates LLC (4) (5) L + 5.50% 6.50% 10/15/2020 04/01/2026 19,387 18,814 18,814 6.24 World Insurance Associates LLC (4) (5) (10) L + 5.50% 6.50% 10/15/2020 04/01/2026 10,087 9,758 9,758 3.24 World Insurance Associates LLC (4) (5) (10) L + 5.50% 6.50% 12/23/2020 04/01/2026 — (46) (46) (0.02) 121,547 123,523 40.95 Interactive Media & Services MSM Acquisitions, Inc. (4) (5) L + 6.00% 7.00% 12/09/2020 12/09/2026 23,684 23,215 23,215 7.70 MSM Acquisitions, Inc. (4) (5) (10) L + 6.00% 7.00% 12/09/2020 12/09/2026 — (49) (49) (0.02) MSM Acquisitions, Inc. (4) (5) (10) L + 6.00% 7.00% 12/09/2020 12/09/2026 — (78) (78) (0.03) 23,088 23,088 7.65 117 Morgan Stanley Direct Lending Fund Consolidated Schedule of Investments (continued) December 31, 2020 (In thousands) Investments-non-controlled/non-affiliated (1) Footnotes Reference Rate and Spread Interest Rate (2) Acquisition Date Maturity Date Par Amount/ Shares Cost (3) Fair Value Percentage of Net Assets IT Services Ensono, LP (4) (6) L + 5.75% 5.90% 06/25/2020 06/27/2025 14,925 $ 14,434 $ 14,925 4.95 % Help/Systems Holdings, Inc. (5) (6) L + 4.75% 5.75% 06/16/2020 11/19/2026 19,850 19,584 19,701 6.53 Recovery Point Systems, Inc. (4) (5) L + 6.50% 7.50% 08/12/2020 08/12/2026 41,895 41,100 41,895 13.89 Recovery Point Systems, Inc. (4) (5) (10) L + 6.50% 7.50% 08/12/2020 08/12/2026 — (75) — — 75,043 76,521 25.37 Leisure Products GSM Acquisition Corp. (GSM Outdoors) (4) (5) L + 5.00% 6.00% 11/16/2020 11/16/2026 22,785 22,449 22,449 7.44 GSM Acquisition Corp. (GSM Outdoors) (4) (5) (10) L + 5.00% 6.00% 11/16/2020 11/16/2026 1,603 1,547 1,547 0.51 GSM Acquisition Corp. (GSM Outdoors) (4) (5) (10) L + 5.00% 6.00% 11/16/2020 11/16/2026 — (50) (50) (0.02) 23,946 23,946 7.94 Multi-Utilities AWP Group Holdings, Inc. (4) (5) L + 4.75% 5.75% 12/22/2020 12/22/2027 711 700 700 0.23 AWP Group Holdings, Inc. (4) (5) (10) L + 4.75% 5.75% 12/22/2020 12/22/2027 — (1) (1) — AWP Group Holdings, Inc. (4) (5) (10) L + 4.75% 5.75% 12/22/2020 12/22/2026 — (2) (2) — 697 697 0.23 Professional Services Bullhorn, Inc. (4) (5) L + 5.75% 6.75% 09/11/2020 09/30/2026 7,427 7,320 7,427 2.46 Bullhorn, Inc. (4) (5) (10) L + 5.75% 6.75% 09/11/2020 09/30/2026 — (8) — — IQN Holding Corp., dba Beeline (4) (5) L + 5.50% 6.50% 02/10/2020 08/20/2024 38,079 37,922 37,721 12.51 IQN Holding Corp., dba Beeline (4) (5) (10) L + 5.50% 6.50% 02/10/2020 08/21/2023 — (17) (43) (0.01) 45,217 45,105 14.95 Real Estate Management & Development MRI Software LLC (4) (5) L + 5.50% 6.50% 01/31/2020 02/10/2026 31,639 31,379 31,639 10.49 MRI Software LLC (4) (5) (10) L + 5.50% 6.50% 01/31/2020 02/10/2026 — (11) — — MRI Software LLC (4) (5) (10) L + 5.50% 6.50% 01/31/2020 02/10/2026 — (19) — — MRI Software LLC (4) (5) (10) L + 5.50% 6.50% 08/28/2020 02/10/2026 1,899 1,727 1,899 0.63 33,076 33,538 11.12 Software GS AcquisitionCo, Inc. (4) (5) L + 5.75% 6.75% 10/27/2020 05/24/2024 23,673 23,323 23,323 7.73 GS AcquisitionCo, Inc. (4) (5) (10) L + 5.75% 6.75% 12/11/2020 05/24/2024 6,848 6,663 6,663 2.21 GS AcquisitionCo, Inc. (4) (5) (10) L + 5.75% 6.75% 12/11/2020 05/24/2024 — (20) (20) (0.01) Gurobi Optimization LLC (4) (5) L + 5.25% 6.25% 11/12/2020 12/19/2023 13,359 13,231 13,231 4.39 Gurobi Optimization LLC (4) (5) (10) L + 5.25% 6.25% 11/12/2020 12/19/2023 — (15) (15) — 43,182 43,182 14.32 Total First Lien Debt $ 575,009 $ 580,867 192.58 % 118 Morgan Stanley Direct Lending Fund Consolidated Schedule of Investments (continued) December 31, 2020 (In thousands) Investments-non-controlled/non-affiliated (1) Footnotes Reference Rate and Spread Interest Rate (2) Acquisition Date Maturity Date Par Amount/ Shares Cost (3) Fair Value Percentage of Net Assets Second Lien Debt Energy Equipment & Services QBS Parent, Inc. (4) L + 8.50% 8.75% 02/10/2020 09/21/2026 15,000 $ 14,731 $ 14,381 4.77 % Diversified Consumer Services Cambium Learning Group, Inc. (4) (5) L + 8.50% 9.50% 10/08/2020 12/18/2026 10,000 9,610 9,610 3.19 Diversified Financial Services HighTower Holdings LLC (4) (5) (7) L + 8.75% 9.75% 10/09/2020 01/31/2026 5,000 4,903 4,903 1.63 Auto Components PAI Holdco, Inc. (4) (5) L + 6.25%; 2.00% PIK 9.25% 10/28/2020 10/28/2028 25,000 24,261 24,261 8.04 Total Second Lien Debt $ 53,505 $ 53,155 17.62 % Other Securities Unsecured Debt Familia Intermediate Holdings I Corp. (Teasdale Latin Foods) (4) (9) N/A 16.25% PIK 12/18/2020 06/18/2026 1,509 $ 1,509 $ 1,509 0.50 % Total Unsecured Debt 1,509 1,509 0.50 Common Equity Pet Holdings, Inc. (Brightpet) (4) 10,000 1,000 1,000 0.33 GSM Equity Investors, LP (GSM Outdoors) (4) 4,500 450 450 0.15 Total Common Equity 1,450 1,450 0.48 Total Other Securities $ 2,959 $ 2,959 0.98 % Total Portfolio Investments $ 631,473 $ 636,981 $ 211.19 % 119 Morgan Stanley Direct Lending Fund Consolidated Schedule of Investments (continued) December 31, 2020 (In thousands) (1) Unless otherwise indicated, issuers of debt and equity investments held by the Company (which such term “Company” shall include the Company’s consolidated subsidiaries for purposes of this Consolidated Schedule of Investments) are denominated in dollars. All debt investments are income producing unless otherwise indicated. All equity investments are non-income producing unless otherwise noted. Certain portfolio company investments are subject to contractual restrictions on sales. Under the Investment Company Act of 1940, as amended (together with the rules and regulations promulgated thereunder, the “1940 Act”), the Company would be deemed to “control” a portfolio company if the Company owned more than 25% of its outstanding voting securities and/or held the power to exercise control over the management or policies of the portfolio company. As of December 31, 2020, the Company does not “control” any of these portfolio companies. Under the 1940 Act, the Company would be deemed an “affiliated person” of a portfolio company if the Company owns 5% or more of the portfolio company’s outstanding voting securities. As of December 31, 2020, the Company is not an “affiliated person” of any of its portfolio companies. (2) Variable rate loans to the portfolio companies bear interest at a rate that is determined by reference to either LIBOR (“L”) or an alternate base rate (commonly based on the Federal Funds Rate (“F”) or the U.S. Prime Rate (“P”)), which generally resets periodically. For each loan, the Company has indicated the reference rate used and provided the spread and the interest rate in effect as of December 31, 2020. As of December 31, 2020, the reference rates for our variable rate loans were the 30-day L at 0.14%, the 90-day L at 0.24% and the 180-day L at 0.26%. (3) The cost represents the original cost adjusted for the amortization of discounts and premiums, as applicable, on debt investments using the effective interest method. (4) These investments were valued using unobservable inputs and are considered Level 3 investments. Fair value was determined in good faith by or under the direction of the Board of Directors (see Note 2 and Note 5), pursuant to the Company’s valuation policy. (5) The interest rate floor on these investments as of December 31, 2020 was 1%. (6) Assets or a portion thereof are pledged as collateral for the BNP Funding Facility. See Note 6 “Debt”. (7) The investment is not a qualifying asset under Section 55(a) of the 1940 Act. The Company may not acquire any non-qualifying asset unless, at the time of acquisition, qualifying assets represent at least 70% of the Company’s total assets. As of December 31, 2020, non-qualifying assets represented 3% of total assets as calculated in accordance with regulatory requirements. (8) The interest rate floor on these investments as of December 31, 2020 was 0.75%. (9) Represents a senior unsecured note, which is subordinated to senior secured term loans of the portfolio company. (10) Position or portion thereof is an unfunded loan commitment, and no interest is being earned on the unfunded portion, although the investment may earn unused commitment fees. Negative cost and fair value, if any, results from unamortized fees, which are capitalized to the cost of the investment. The unfunded loan commitment may be subject to a commitment termination date that may expire prior to the maturity date stated. See below for more information on the Company’s unfunded commitments as of December 31, 2020: Investments-non-controlled/non-affiliated Unused Fee Rate Commitment Type Commitment Expiration Date Unfunded Commitment Fair Value First Lien Debt AMCP Pet Holdings, Inc. 1.00% Delayed Draw Term Loan 04/06/2022 $ 5,000 $ (144) AMCP Pet Holdings, Inc. 0.50% Revolver 10/01/2025 5,833 (172) AWP Group Holdings, Inc. 1.00% Delayed Draw Term Loan 12/22/2022 132 (1) AWP Group Holdings, Inc. 0.50% Revolver 12/22/2026 158 (2) Bearcat Buyer, Inc. 1.00% Delayed Draw Term Loan 11/18/2022 5,413 (134) Bullhorn, Inc. 0.50% Revolver 09/30/2026 554 — Capstone Acquisition Holdings, Inc. 1.00% Delayed Draw Term Loan 05/13/2022 507 3 Divisions Holding Corporation 1.00% Delayed Draw Term Loan 08/14/2022 5,217 — Divisions Holding Corporation 0.50% Revolver 08/14/2026 3,478 — GS AcquisitionCo, Inc. 0.50% Delayed Draw Term Loan 10/17/2021 11,235 (109) GS AcquisitionCo, Inc. 0.50% Revolver 05/24/2024 1,370 (20) GSM Acquisition Corp. 1.00% Delayed Draw Term Loan 11/16/2022 2,195 (32) GSM Acquisition Corp. 0.50% Revolver 11/16/2026 3,418 (50) Gurobi Optimization LLC 0.50% Revolver 12/19/2023 1,607 (15) Higginbotham Insurance Agency, Inc. 1.00% Delayed Draw Term Loan 11/25/2022 4,119 (31) HighTower Holdings LLC 1.00% Delayed Draw Term Loan 10/14/2022 2,419 (17) Integrity Marketing Acquisition LLC 1.00% Delayed Draw Term Loan 02/07/2022 15,540 — IQN Holding Corp., dba Beeline 0.50% Revolver 08/21/2023 4,545 (43) 120 Morgan Stanley Direct Lending Fund Consolidated Schedule of Investments (continued) December 31, 2020 (In thousands) Investments-non-controlled/non-affiliated Unused Fee Rate Commitment Type Commitment Expiration Date Unfunded Commitment Fair Value Lightspeed Buyer, Inc. 1.00% Delayed Draw Term Loan 05/09/2022 9,375 (182) Majesco 0.50% Revolver 09/21/2026 1,575 — MRI Software LLC 0.50% Delayed Draw Term Loan 02/10/2022 908 — MRI Software LLC 1.00% Incremental Delayed Draw Term Loan 08/24/2022 15,096 — MRI Software LLC 0.50% Revolver 02/10/2026 2,215 — MSM Acquisitions, Inc. 0.00% Delayed Draw Term Loan 06/09/2022 9,869 (49) MSM Acquisitions, Inc. 0.00% Revolver 12/09/2026 3,947 (78) Propel Insurance Agency LLC 1.00% Delayed Draw Term Loan 12/09/2022 3,874 (19) Recovery Point Systems, Inc. 0.50% Revolver 08/12/2026 4,000 — RSC Acquisition, Inc. 1.00% Delayed Draw Term Loan 03/31/2022 11,353 — Sonny’s Enterprises, Inc. 1.00% Delayed Draw Term Loan 12/28/2021 13,281 (266) Sweep Purchaser LLC 0.00% Delayed Draw Term Loan 11/30/2022 2,813 (28) Sweep Purchaser LLC 0.50% Revolver 11/30/2026 1,406 (28) Turbo Buyer, Inc. 1.00% Incremental Delayed Draw Term Loan 02/21/2022 35,000 (407) US Infra Svcs Buyer LLC 1.00% Delayed Draw Term Loan 04/13/2022 9,510 — US Infra Svcs Buyer LLC 0.50% Revolver 04/13/2026 1,950 — Vessco Midco Holdings LLC 5.50% Delayed Draw Term Loan 10/30/2022 1,655 (16) Vessco Midco Holdings LLC 0.50% Revolver 10/18/2026 447 (4) World Insurance Associates LLC 1.00% Delayed Draw Term Loan 10/15/2022 2,438 (64) World Insurance Associates LLC 0.50% Delayed Draw Term Loan 12/23/2022 3,088 (46) Total First Lien Debt Unfunded Commitments $ 206,540 $ (1,954) Total Unfunded Commitments $ 206,540 $ (1,954) 121 Table of Contents Morgan Stanley Direct Lending Fund Notes to Consolidated Financial Statements December 31, 2021 (In thousands, except shares and per share amounts) (1) Organization Morgan Stanley Direct Lending Fund (the “Company”) is an externally managed specialty finance company that is focused on lending to middle-market companies. The Company has elected to be regulated as a business development company (“BDC”) under the Investment Company Act of 1940 Act, as amended (the “1940 Act”). In addition, for U.S. federal income tax purposes, the Company has elected to be treated, and intends to comply with the requirements to qualify annually, as a regulated investment company (“RIC”) under Subchapter M of the Internal Revenue Code of 1986, as amended (the “Code”). The Company was formed as a Delaware limited liability company on May 30, 2019 with the name Morgan Stanley BDC LLC, and its name was changed to Morgan Stanley Direct Lending Fund LLC on August 8, 2019. On November 25, 2019, pursuant to BDC conversion, the Company was converted into a corporation and succeeded to the business of the Morgan Stanley Direct Lending Fund LLC (the “BDC Conversion”). The Company commenced investing operations in January 2020. Pursuant to the Company’s operating agreement, the Company has delegated the right to manage the assets of the Company to MS Capital Partners Adviser Inc., as the investment adviser to the Company (the “Adviser” or “Investment Adviser”). The Investment Adviser is a wholly owned subsidiary of Morgan Stanley. The Company’s investment objective is to achieve attractive risk-adjusted returns via current income and, to a lesser extent, capital appreciation by investing primarily in directly originated senior secured term loans issued by U.S. middle-market companies backed by financial sponsors. The Company is conducting private offerings of shares of the common stock of the Company, par value $0.001 per share (the “Common Stock”), to investors in reliance on exemptions from the registration requirements of the Securities Act of 1933, as amended. At the closing of any private offering, each investor makes a capital commitment (a “Capital Commitment”) to purchase shares of Common Stock pursuant to a subscription agreement entered into with the Company. Investors are required to fund drawdowns to purchase shares of Common Stock up to the amount of their respective Capital Commitments each time the Company delivers a notice to the investors. DLF CA SPV LLC (“CA SPV”) is a Delaware limited liability company that was formed on February 26, 2020. CA SPV expects to hold investments in first and second lien senior secured loans. CA SPV is a wholly owned subsidiary of the Company and is consolidated in these consolidated financial statements commencing from the date of its formation. DLF SPV LLC (“DLF SPV”) is a Delaware limited liability company that was formed on August 7, 2020. DLF SPV expects to hold investments in first and second lien senior secured loans. DLF SPV is a wholly owned subsidiary of the Company and is consolidated in these consolidated financial statements commencing from the date of its formation. DLF Financing SPV LLC (“DLF LLC”) is a Delaware limited liability company that was formed on September 17, 2020. DLF LLC expects to hold investments in first and second lien senior secured loans. DLF LLC is a wholly owned subsidiary of the Company and is consolidated in these consolidated financial statements commencing from the date of its formation. DLF Equity Holdings LLC (“DLF Equity Holdings”) is a Delaware limited liability company that was formed on November 24, 2021. DLF Equity Holdings expects to hold equity investments. DLF Equity Holdings is a wholly owned subsidiary of the Company and is consolidated in these consolidated financial statements commencing from the date of its formation. 122 Table of Contents (2) Summary of Significant Accounting Policies Basis of Presentation The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”). As an investment company, the Company applies the accounting and reporting guidance in Accounting Standards Codification (“ASC”) Topic 946, Financial Services – Investment Companies (“ASC 946”) issued by the Financial Accounting Standards Board (“FASB”). The carrying value for all assets and liabilities approximates their fair value. Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities and expenses and disclosure of contingent assets and liabilities at the date of the consolidated financial statements. Such amounts could differ from those estimates and such differences could be material. Management’s estimates are based on historical experiences and other factors, including expectations of future events that management believes to be reasonable under the circumstances. Assumptions and estimates regarding the valuation of investments involve a higher degree of judgment and complexity and these assumptions and estimates may be significant to the consolidated financial statements. Consolidation As provided under ASC 946, the Company will not consolidate its investment in a company other than an investment company subsidiary or a controlled operating company whose business consists of providing services to the Company. Accordingly, the Company consolidated the results of the Company’s wholly-owned subsidiaries. As of December 31, 2021, the Company’s consolidated subsidiaries were CA SPV, DLF SPV, DLF LLC and DLF Equity Holdings (collectively, the “subsidiaries”). Cash Cash is carried at cost, which approximates fair value. The Company deposits its cash with multiple financial institutions and, at times, may exceed the Federal Deposit Insurance Corporation insured limit. Investments Investment transactions are recorded on the trade date. Receivables/payables from investments sold/purchased on the Consolidated Statements of Assets and Liabilities consist of amounts receivable to or payable by the Company for transactions that have not settled at the reporting date. Realized gains or losses are measured by the difference between the net proceeds received (excluding prepayment fees, if any) and the amortized cost basis of the investment using the specific identification method without regard to unrealized gains or losses previously recognized, and include investments charged off during the period, net of recoveries. The net change in unrealized gains or losses primarily reflects the change in investment values, including the reversal of previously recorded unrealized gains or losses with respect to investments realized during the period. See Note 5 for further information about fair value measurements. Revenue Recognition Interest Income Interest income is recorded on an accrual basis and includes the accretion of discounts and amortizations of premiums. Discounts from and premiums to par value on debt investments purchased are accreted/amortized into interest income over the life of the respective investment using the effective interest method. The amortized cost of debt investments represents the original cost, including loan origination fees and upfront fees received that are deemed to be an adjustment to yield, adjusted for the accretion of discounts and amortization of premiums, if any. Upon prepayment of a loan or debt investment, any prepayment premiums, unamortized upfront loan origination fees and unamortized discounts are recorded as interest income in the current period. PIK Income The Company has loans in its portfolio that contain payment-in-kind (“PIK”) provisions. PIK represents interest that is accrued and recorded as interest income at the contractual rates, increases the loan principal on the respective capitalization dates, and 123 Table of Contents is generally due at maturity. Such income is included in interest income in the Consolidated Statements of Operations. If at any point the Company believes PIK is not expected to be realized, the investment generating PIK will be placed on non-accrual status. When a PIK investment is placed on non-accrual status, the accrued, uncapitalized interest is generally reversed through interest income. To maintain the Company’s status as a RIC, this non-cash source of income must be paid out to stockholders in the form of dividends, even though the Company has not yet collected cash. Dividend income Dividend income on preferred equity investments is recorded on an accrual basis to the extent that such amounts are payable by the portfolio company and are expected to be collected. Dividend income on common equity investments is recorded on the record date for private portfolio companies and on the ex-dividend date for publicly traded portfolio companies. Dividend income is presented net of withholding tax, if any. Other Income The Company may receive various fees in the ordinary course of business such as structuring, consent, waiver, amendment and syndication fees as well as fees for managerial assistance rendered by the Company to the portfolio companies. Such fees are recognized in income when earned or when the services are rendered and there is no uncertainty or contingency related to the amount to be received. Non-Accrual Income Loans are generally placed on non-accrual status when there is reasonable doubt that principal or interest will be collected in full. Accrued interest is generally reversed when a loan is placed on non-accrual status. Additionally, any original issue discount and market discount are no longer accreted to interest income as of the date the loan is placed on non-accrual status. Interest payments received on non-accrual loans may be recognized as income or applied to principal depending upon management’s judgment regarding collectability. Non-accrual loans are restored to accrual status when past due principal and interest are paid current and, in management’s judgment, are likely to remain current. Management may determine to not place a loan on non-accrual status if the loan has sufficient collateral value and is in the process of collection. Realized Gains/Losses Realized gains or losses are measured by the difference between the net proceeds received (excluding prepayment fees, if any) and the amortized cost basis of the investment using the specific identification method without regard to unrealized gains or losses previously recognized, and include investments charged off during the period, net of recoveries. Organization and Offering Costs Costs associated with the organization of the Company are expensed as incurred, subject to the limitations discussed in Note 3. These costs consist primarily of legal fees and other costs of organizing the Company. Costs associated with the offering of Common Stock are capitalized as “deferred offering costs” on the Consolidated Statements of Assets and Liabilities and amortized over a twelve-month period from the initial capital call, subject to the limitation described in Note 3 below. These costs consist primarily of legal fees and other costs incurred in connection with the Company’s continuous private offerings of its Common Stock. Expenses The Company is responsible for investment expenses, professional fees and other general and administrative expenses related to the Company’s operations. Such fees and expenses, including expenses incurred by the Adviser on behalf of the Company, will be reimbursed by the Company, subject to contractual thresholds. The Company pays the Investment Adviser a base management fee and an incentive fee under the Investment Advisory Agreement as described in Note 3 below. The fees are recorded in the Consolidated Statements of Operations. Deferred Financing Costs Deferred financing costs represent upfront fees, legal and other direct incremental costs incurred in connection with the Company’s borrowings. These costs are deferred and will be amortized over the life of the related borrowings using the straight-line method. Deferred financing costs related to revolving credit facilities are presented separately as an asset on the Company’s Consolidated Statements of Assets and Liabilities. 124 Table of Contents Income Taxes The Company has elected to be treated as a RIC under Subchapter M of the Code. So long as the Company maintains its status as a RIC, it generally will not pay corporate U.S. federal income taxes on any ordinary income or capital gains that it distributes at least annually to its stockholders as dividends. In order to qualify as a RIC, the Company must meet certain minimum distribution, source-of-income and asset diversification requirements. If such requirements are met, then the Company is generally required to pay income taxes only on the portion of its taxable income and gains it does not distribute. The minimum distribution requirements applicable to RICs require the Company to distribute to its stockholders at least 90% of its investment company taxable income (the “ICTI”), as defined by the Code, each year. Depending on the level of ICTI earned in a tax year, the Company may choose to carry forward ICTI in excess of current year distributions into the next tax year. Any such carryover ICTI must be distributed before the end of that next tax year through a dividend declared prior to filing the final tax return related to the year which generated such ICTI. In addition, based on the excise distribution requirements, the Company is subject to a 4% nondeductible federal excise tax on undistributed income unless the Company distributes in a timely manner an amount at least equal to the sum of (1) 98% of its ordinary income for each calendar year, (2) 98.2% of capital gain net income (both long-term and short-term) for the one-year period ending October 31 in that calendar year and (3) any income realized, but not distributed, in the preceding year. For this purpose, however, any ordinary income or capital gain net income retained by the Company that is subject to corporate income tax is considered to have been distributed. The Company intends to make sufficient distributions each taxable year to satisfy the excise distribution requirements. The Company evaluates tax positions taken or expected to be taken in the course of preparing its consolidated financial statements to determine whether the tax positions are “more likely than not” to be sustained by the applicable tax authority. All penalties and interest associated with income taxes, if any, are included in income tax expense. For the year ended December 31, 2021, the Company accrued $80 of U.S. federal excise tax. For the year ended December 31, 2020, the Company did not accrue any U.S. federal excise tax. New Accounting Standards In March 2020, the Financial Accounting Standards Board issued Accounting Standards Update 2020-04 (“ASU 2020-04”) “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting.” This accounting update provides optional accounting relief to entities with contracts, hedge accounting relationships or other transactions that reference LIBOR or other interest rate benchmarks for which the referenced rate is expected to be discontinued or replaced. This optional relief generally allows for contract modifications solely related to the replacement of the reference rate to be accounted for as a continuation of the existing contract instead of as an extinguishment of the contract, and would therefore not trigger certain accounting impacts that would otherwise be required. The optional relief can be applied beginning January 1, 2020 and ending December 31, 2022. We plan to apply the accounting relief as relevant contract relationship modifications are made during the course of the reference rate reform transition period. (3) Related Party Transactions Placement Agent Agreement On August 30, 2019, the Company entered into a placement agent agreement (the “Placement Agent Agreement”) with Morgan Stanley Distribution Inc. (the “Paying Agent”), Morgan Stanley Smith Barney LLC (the “Placement Agent”) and the Investment Adviser. Under the terms of the Placement Agent Agreement, the Placement Agent and certain of its affiliates will assist in the placement of common stock in the Company’s private offerings. The Company is not liable for any payments to the Placement Agent pursuant to the Placement Agent Agreement. Payments will be made by the Investment Adviser to the Placement Agent. To the extent the Paying Agent receives any payments it will remit the payment to the Placement Agent. Investment Advisory Agreement On November 25, 2019, the Company’s Board of Directors (the “Board of Directors”), including a majority of the directors who are not “interested persons” as defined in Section 2(a)(19) of the Investment Company Act (the “Independent Directors”), approved the Investment Advisory Agreement in accordance with, and on the basis of an evaluation satisfactory to such directors as required by, Section 15(c) of the Investment Company Act. 125 Table of Contents The Company pays the Investment Adviser a fee for its services under the Investment Advisory Agreement consisting of two components: a base management fee (the “Base Management Fee”) and an incentive fee. The cost of both the Base Management Fee and the incentive fee will ultimately be borne by the stockholders. Base Management Fee The Base Management Fee is calculated at an annual rate of 1.0% of the Company’s average gross assets at the end of the two most recently completed calendar quarters, including assets purchased with borrowed funds or other forms of leverage but excluding cash and cash equivalents. Prior to listing the Company on an exchange, the Adviser has agreed to irrevocably waive the portion of the Base Management Fee in excess of 0.25% of the Company’s average gross assets calculated in accordance with the Investment Advisory Agreement. Any waived Base Management Fees are not subject to recoupment by the Adviser. The Base Management Fee is payable quarterly in arrears, and no management fee is charged on committed but undrawn Capital Commitments. For the year ended December 31, 2021 and December 31, 2020, base management fees were $3,465 and $560 net of waiver, respectively. As of December 31, 2021 and December 31, 2020, $1,306 and $295 were payable to the Investment Adviser relating to base management fees. Incentive Fee The incentive fee consists of two components that are determined independently of each other, with the result that one component may be payable even if the other is not. One component is based on income and the other component is based on capital gains. The Company pays its Adviser an income based incentive fee with respect to the Company’s pre-incentive fee net investment income in each calendar quarter as follows: • No income based incentive fee if the Company’s pre-incentive fee net investment income, expressed as a return on the value of the Company’s net assets at the end of the immediately preceding calendar quarter, does not exceed the hurdle rate of 1.5% (6.0% annualized); • 100% of the Company’s pre-incentive fee net investment income, if any, that exceeds the hurdle rate but is less than 1.8182% (7.2728% annualized). This portion of the pre-incentive fee net investment income (which exceeds the Hurdle Rate but is less than 1.8182%) is referred to as the “catch-up”. This “catch-up” portion is meant to provide the Adviser with approximately 17.5% of the Company’s pre-incentive fee net investment income as if a hurdle rate did not apply if the “catch up” is achieved; and • 17.5% of the Company’s pre-incentive fee net investment income, if any, that exceeds the rate of return of 1.8182% (7.2728% annualized) The second part of the incentive fee is determined on realized capital gains calculated and payable in arrears in cash as of the end of each calendar year or upon the termination of the Investment Advisory Agreement in an amount equal to 17.5% of the realized capital gains, if any, on a cumulative basis from the date of our election to be regulated as a business development company through the end of a given calendar year or upon the termination of the Investment Advisory Agreement, computed net of all realized capital losses and unrealized capital depreciation on a cumulative basis, less the aggregate amount of any previously paid capital gain incentive fees (the “Cumulative Capital Gains”). Under U.S. GAAP, the Company is required to accrue an incentive fee on capital gains, including unrealized capital appreciation even though such unrealized capital appreciation is not included in calculating the incentive fee payable under the Investment Advisory Agreement. If such amount is positive at the end of a period, then the Company will record an incentive fee on capital gain incentive fee equal to 17.5% of such amount, less the aggregate amount of any previously paid capital gain incentive fees. If such amount is negative, no accrual will be recorded for such period. For the year ended December 31, 2021 and December 31, 2020, $15,852 and $2,517 respectively, of income based incentive fees were accrued to the Investment Adviser. For the year ended December 31, 2021 and December 31, 2020, $1,809 and $1,341 of capital gains incentive fees were accrued to the Investment Adviser, respectively. The Investment Advisory Agreement does not permit unrealized capital appreciation for purposes of calculating the amount payable to the Investment Adviser. Amounts due related to unrealized capital appreciation, if any, will not be paid to the Investment Adviser until realized under the terms of the Investment Advisory Agreement and determined based on the calculation. Incentive fees on Cumulative Capital Gains crystallize at calendar year-end. 126 Table of Contents As of December 31, 2021, $5,886 and $2,773 were payable to the Investment Adviser relating to income based incentive fees and capital gains incentive fees, respectively. As of December 31, 2020, $1,548 and $1,341 were payable to the Investment Adviser relating to income based incentive fees and capital gains incentive fees, respectively. Administration Agreement MS Private Credit Administrative Services LLC, f/k/a MS BDC Administrative Services LLC (the “Administrator”), is the administrator of the Company pursuant to an administration agreement (the “Administration Agreement”). Pursuant to the Administration Agreement, the Administrator provides services and receives reimbursements from the Company equal to an amount that reimburses the Administrator for its costs and expenses and the Company’s allocable portion of certain expenses incurred by the Administrator in performing its obligations under the Administration Agreement, including the Company’s allocable portion of the compensation paid to the Company’s Chief Compliance Officer and Chief Financial Officer. Reimbursement under the Administration Agreement occurs quarterly in arrears. For the year ended December 31, 2021 and December 31, 2020, the Company incurred $212 and $183, respectively, in expenses under the Administration Agreement, which were recorded in administrative service expenses on the Company’s Consolidated Statements of Operations. Amounts unpaid and included in payable to affiliates on the Consolidated Statements of Assets and Liabilities as of December 31, 2021 and December 31, 2020 were $266 and $60, respectively. Expense Support and Waiver Agreement On December 31, 2019, the Company entered into an expense support and waiver agreement (the “Expense Support and Waiver Agreement”) with the Investment Adviser. Under the terms of the Expense Support and Waiver Agreement, the Investment Adviser agreed to waive any reimbursement by the Company of offering and organizational expenses to be incurred by the Investment Adviser on behalf of the Company in excess of $1,000 or 0.10% of the aggregate Capital Commitments of the Company, whichever is greater. If actual organization and offering costs incurred exceed the greater of $1,000 or 0.10% of the Company’s total Capital Commitments, the Investment Adviser or its affiliate will bear the excess costs. The Company shall reimburse the Investment Adviser for payments of any excess costs borne by the Investment Adviser on the Company’s behalf within three years of December 23, 2019 (the “Initial Closing Date”). During the year ended December 31, 2021, the Company incurred $42 towards organization cost and amortization of offering cost. The Investment Adviser recaptured $98 of previously waived amounts from the Company since actual offering and organizational expenses incurred from May 30, 2019 (inception). For the year ended December 31, 2020, the Company incurred $676 towards organization cost and amortization of offering cost. These costs exceeded the Investment Adviser reimbursement threshold, and as a result, the excess organization cost of $230 was waived. As of December 31, 2021 and December 31, 2020, organization cost and offering cost are included in payable to affiliates and accrued expenses and other liabilities in the Consolidated Statements of Assets and Liabilities. License Agreement The Company entered into a license agreement with Morgan Stanley (the “License Agreement”) under which Morgan Stanley has agreed to grant the Company a non-exclusive, royalty-free license to use the name “Morgan Stanley” for specified purposes in the Company’s business. Under the License Agreement, the Company will have a right to use the “Morgan Stanley” name, subject to certain conditions, for so long as the Investment Adviser or one of its affiliates remains the Company’s investment adviser. Other than with respect to this limited license, the Company will have no legal right to the “Morgan Stanley” name. MS Credit Partners Holdings Investment MS Credit Partners Holdings, Inc. (“MS Credit Partners Holdings”), a wholly owned subsidiary of Morgan Stanley and an affiliate of the Investment Adviser, made an aggregate Capital Commitment of $200,000 to the Company in 2019. As of December 31, 2021 and December 31, 2020, MS Credit Partners Holdings’ total capital commitment represented approximately 13% and 14% of aggregate capital commitments received, respectively. (4) Investments 127 Table of Contents The composition of the Company’s investment portfolio as of December 31, 2021 and December 31, 2020 at cost and fair value were as follows: December 31, 2021 December 31, 2020 Cost Fair Value % of Total Investments at Fair Value Cost Fair Value % of Total Investments at Fair Value First Lien Debt $ 2,213,332 $ 2,224,100 93.2 % $ 575,009 $ 580,867 91.2 % Second Lien Debt 120,124 121,550 5.1 53,505 53,155 8.3 Other Securities 39,979 41,724 1.7 2,959 2,959 0.5 Total $ 2,373,435 $ 2,387,374 100.0 % $ 631,473 $ 636,981 100.0 % The industry composition of investments at fair value was as follows: December 31, 2021 December 31, 2020 (1) Aerospace and Defense 1.7 % — % Air Freight and Logistics 0.5 — Auto Components 3.3 4.6 Automobiles 7.4 (0.1) Biotechnology 0.6 — Commercial Services & Supplies 13.0 10.0 Construction and Engineering 1.5 — Containers & Packaging 1.6 2.0 Distributors 1.2 — Diversified Consumer Services 1.5 1.5 Diversified Financial Services 0.1 2.7 Electronic Equipment, Instruments & Components 0.7 0.0 Energy Equipment & Services 0.6 2.3 Food Products 3.1 11.2 Health Care Equipment & Supplies 0.4 — Health Care Providers & Services 2.9 1.3 Health Care Technology 0.9 1.4 Industrial Conglomerates 1.8 5.0 Insurance 17.1 19.4 Interactive Media & Services 3.8 3.6 IT Services 10.8 12.0 Leisure Products 2.4 3.8 Machinery 2.0 — Multi-Utilities 0.4 0.1 Professional Services 4.0 7.1 Real Estate Management & Development 5.2 5.3 Software 11.5 6.8 Total 100.0 % 100.0 % (1) Negative percentage is resulted from negative fair value of an unfunded loan commitment. The geographic composition of investments as of December 31, 2021 and December 31, 2020 at cost and fair value were as follows: 128 Table of Contents December 31, 2021 December 31, 2020 Cost Fair Value % of Total Investments at Fair Value Cost Fair Value % of Total Investments at Fair Value Canada $ 81,935 $ 81,386 3.4 % $ — $ — — % United Kingdom 17,804 18,200 0.8 — — — United States 2,273,696 2,287,789 95.8 631,473 636,981 100.0 Total $ 2,373,435 $ 2,387,374 100.0 % $ 631,473 $ 636,981 100.0 % (5) Fair Value Measurements The Company conducts the valuation of assets at all times consistent with U.S. GAAP and the 1940 Act. The Company’s board of directors (the “Board”), with the assistance of the Audit Committee, determines the fair value of the assets for assets with a daily public market, and for assets with no readily available public market, on at least a quarterly basis, in accordance with FASB ASC 820, Fair Value Measurements (“ASC 820”). Valuation procedures are set forth in more detail below. ASC 820 defines fair value as “the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.” Fair value is a market-based measurement, not an entity-specific measurement. For some assets and liabilities, observable market transactions or market information might be available. For other assets and liabilities, observable market transactions and market information might not be available. However, the objective of a fair value measurement in both cases is the same—to estimate the price when an orderly transaction to sell the asset or transfer the liability would take place between market participants at the measurement date under current market conditions (that is, an exit price at the measurement date from the perspective of a market participant that holds the asset or owes the liability). ASC 820 establishes a hierarchical disclosure framework which ranks the observability of inputs used in measuring financial instruments at fair value. The observability of inputs is impacted by a number of factors, including the type of financial instruments and their specific characteristics. Financial instruments with readily available quoted prices, or for which fair value can be measured from quoted prices in active markets, generally will have a higher degree of market price observability and a lesser degree of judgment applied in determining fair value. The three-level hierarchy for fair value measurements is defined as follows: Level 1—inputs to the valuation methodology are quoted prices available in active markets for identical financial instruments as of the measurement date. The types of financial instruments in this category include unrestricted securities, including equities and derivatives, listed in active markets. The Company does not adjust the quoted price for these instruments, even in situations where the Company holds a large position and a sale could reasonably impact the quoted price. Level 2—inputs to the valuation methodology are quoted prices in markets that are not active or for which all significant inputs are either directly or indirectly observable as of the measurement date. The types of financial instruments in this category include less liquid and restricted securities listed in active markets, securities traded in markets that are not active, and certain over-the-counter derivatives where the fair value is based on observable inputs. Level 3—inputs to the valuation methodology are unobservable and significant to the overall fair value measurement, and include situations where there is little, if any, market activity for the investment. The inputs into the determination of fair value require significant management judgment or estimation. The types of financial instruments in this category include investments in privately held entities, non-investment grade residual interests in securitizations and certain over-the-counter derivatives where the fair value is based on unobservable inputs. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the determination of which category within the fair value hierarchy is appropriate for any given financial instrument is based on the lowest level of input that is significant to the fair value measurement. Assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the financial instrument. Pursuant to the framework set forth above, the Company values securities traded in active markets on the measurement date by multiplying the exchange closing price of such traded securities/instruments by the quantity of shares or amount of the instrument held. The Company may also obtain quotes with respect to certain of the investments from pricing services, brokers or dealers’ quotes, or counterparty marks in order to value liquid assets that are not traded in active markets. Pricing services aggregate, evaluate and report pricing from a variety of sources including observed trades of identical or similar securities, broker or dealer quotes, model-based valuations and internal fundamental analysis and research. When doing so, the Company determines whether the quote obtained 129 Table of Contents is sufficient according to U.S. GAAP to determine the fair value of the security. If determined adequate, the Company uses the quote obtained. Securities that are illiquid or for which the pricing source does not provide a valuation or methodology or provides a valuation or methodology that, in the judgment of the Investment Adviser or the Board, does not represent fair value, each is valued as of the measurement date using all techniques appropriate under the circumstances and for which sufficient data is available. These valuation techniques may vary by investment but include comparable public market valuations, comparable precedent transaction valuations and discounted cash flow analyses. Non-controlled debt investments are generally fair valued using discounted cash flow technique. Expected cash flows are projected based on contractual terms and discounted back to the measurement date based on a discount rate. Discount rate is determined based upon an assessment of current and expected yields for similar investments and risk profiles. Non-controlled equity investments are generally fair valued using a market approach and/or an income approach. The market approach typically utilizes market value multiples of comparable publicly traded companies. The income approach typically utilizes a discounted cash flow analysis of the portfolio company. The Board undertakes a multi-step valuation process each quarter, as described below: 1) each portfolio company or investment is initially valued by using a standardized template designed to approximate fair market value based on observable market inputs and updated credit statistics and unobservable inputs; 2) preliminary valuation conclusions are documented and reviewed by a valuation committee comprised of members of the Investment Adviser’s senior management; 3) the Board engages one independent third-party valuation firm to provide positive assurance on a portion of the Company’s illiquid investments each quarter (such that each illiquid investment will be reviewed by an independent valuation firm at least once on a rolling twelve month basis) including review of management’s preliminary valuation and conclusion of fair value; 4) the Audit Committee reviews the assessments of the Investment Adviser and the independent third-party valuation firm and provide the Board with recommendations with respect to the fair value of each investment in the Company’s portfolio; and (5) the Board discusses the valuation recommendations of the Audit Committee and determine the fair value of each investment in the Company’s portfolio in good faith based on the input of the Investment Adviser and, where applicable, the third-party valuation firm. The fair value is generally determined based on the assessment of the following factors, as relevant: • the nature and realizable value of any collateral; • call features, put features and other relevant terms of debt; • the portfolio company’s leverage and ability to make payments; • the portfolio company’s public or “private letter” credit ratings; • the portfolio company’s actual and expected earnings and discounted cash flow; • prevailing interest rates for like securities and expected volatility in future interest rates; • the markets in which the issuer does business and recent economic and/or market events; and • comparisons to publicly traded securities. Investment performance data utilized will be the most recently available as of the measurement date which in many cases may reflect up to a one quarter lag in information. The Board is ultimately responsible for the determination, in good faith, of the fair value of the Company’s portfolio investments. During the year ended December 31, 2021, there was $2,849 of portfolio investments transferred into Level 3 from Level 2 at fair value as of the beginning of the period in which the reclassification occurred, primarily due to decreased price transparency. The following tables present the fair value hierarchy of investments: 130 Table of Contents December 31, 2021 Level 1 Level 2 Level 3 Total First Lien Debt $ — $ 17,064 $ 2,207,036 $ 2,224,100 Second Lien Debt — — 121,550 121,550 Other Securities — — 27,973 27,973 Subtotal $ — $ 17,064 $ 2,356,559 $ 2,373,623 Investment measured at net asset value (1) $ 13,751 Total $ 2,387,374 (1) The Company, as a practical expedient, estimates the fair value of its investment in Help HP SCF Investor, LP using the net asset value of the Company’s member’s interest in the entity. As such, the fair value has not been classified within the fair value hierarchy. December 31, 2020 Level 1 Level 2 Level 3 Total First Lien Debt $ — $ 22,549 $ 558,318 $ 580,867 Second Lien Debt — — 53,155 53,155 Other Securities — — 2,959 2,959 Total $ — $ 22,549 $ 614,432 $ 636,981 The following table presents changes in the fair value of the investments for which Level 3 inputs were used to determine the fair value for the year ended December 31, 2021: First Lien Debt Second Lien Debt Other Securities Total Investments Fair value, beginning of period $ 558,318 $ 53,155 $ 2,959 $ 614,432 Purchases of investments 1,956,780 101,352 25,723 2,083,855 Proceeds from principal repayments and sales of investments (325,175) (36,250) (3,348) (364,773) Accretion of discount/amortization of premium 8,831 1,008 — 9,839 Payment-in-kind 133 509 537 1,179 Net change in unrealized appreciation (depreciation) 5,052 1,776 455 7,283 Net realized gains (losses) 248 — 1,647 1,895 Transfers into/(out) of Level 3 2,849 — — 2,849 Fair value, end of period $ 2,207,036 $ 121,550 $ 27,973 $ 2,356,559 Net change in unrealized appreciation (depreciation) from investments still held as of December 31, 2021 $ 6,807 $ 1,775 $ 455 $ 9,037 The following table presents changes in the fair value of the investments for which Level 3 inputs were used to determine the fair value for the year ended December 31, 2020: 131 Table of Contents First Lien Debt Second Lien Debt Other Securities Total Investments Fair value, beginning of period $ — $ — $ — $ — Purchases of investments 594,502 53,450 2,950 650,902 Proceeds from principal repayments and sales of investments (43,241) — — (43,241) Accretion of discount/amortization of premium 1,368 55 — 1,423 Payment-in-kind — — 9 9 Net change in unrealized appreciation (depreciation) 5,689 (350) — 5,339 Net realized gains (losses) — — — — Transfers into/(out) of Level 3 — — — — Fair value, end of period $ 558,318 $ 53,155 $ 2,959 $ 614,432 Net change in unrealized appreciation (depreciation) from investments still held as of December 31, 2020 $ 5,689 $ (350) $ — $ 5,339 The following table presents quantitative information about the significant unobservable inputs of the Company’s Level 3 financial instruments. The table is not intended to be all-inclusive but instead captures the significant unobservable inputs relevant to the Company’s determination of fair value. December 31, 2021 Range Fair Value Valuation Technique Unobservable Input Low High Weighted Average Investments in first lien debt $ 2,207,036 Yield Analysis Discount Rate 5.55 % 12.44 % 7.52 % Investments in second lien debt 121,550 Yield Analysis Discount Rate 7.12 % 10.79 % 8.51 % Investments in other securities: Unsecured debt 1,350 Yield Analysis Discount Rate 25.33 % 25.33 % 25.33 % Market Approach EBITDA Multiple 9.00x 9.00x 9.00x Preferred equity 9,950 Yield Analysis Discount Rate 11.70 % 12.10 % 11.92 % 1,298 Market Approach Revenue Multiple 11.80x 11.80x 11.80x Common equity 15,375 Market Approach EBITDA Multiple 8.10x 19.97x 13.11x Total investment in other securities 27,973 Total Investments $ 2,356,559 December 31, 2020 Range Fair Value Valuation Technique Unobservable Input Low High Weighted Average Investments in first lien debt $ 558,318 Yield Analysis Discount Rate 5.75 % 8.86 % 7.18 % Investments in second lien debt 53,155 Yield Analysis Discount Rate 10.35 % 10.95 % 10.52 % Investments in other securities 2,959 Market Approach EBITDA Multiple 9.15x 10.01x 9.71x Total Investments $ 614,432 The significant unobservable input used in yield analysis is discount rate based on comparable market yields. Significant increases in discount rates in isolation would result in a significantly lower fair value measurement. The significant unobservable input used in the market approach is the comparable company multiple. The multiple is used to estimate the enterprise value of the underlying investment. An increase/decrease in the multiple would result in an increase/decrease, respectively, in the fair value. Financial instruments disclosed but not carried at fair value The carrying value and fair value of the Company’s secured borrowings disclosed but not carried at fair value were as follows: 132 Table of Contents December 31, 2021 December 31, 2020 Carrying Value Fair Value Carrying Value Fair Value CIBC Subscription Facility $ 310,350 $ 310,350 $ 333,850 $ 333,850 BNP Funding Facility 463,500 463,500 — — Truist Credit Facility 476,000 476,000 — — Total $ 1,249,850 $ 1,249,850 $ 333,850 $ 333,850 The above fair value measurements were based on significant unobservable inputs and thus represent Level 3 measurements as defined under ASC 820. The carrying amounts of the Company’s assets and liabilities, other than investments at fair value and secured borrowings, approximate fair value. (6) Debt CIBC Subscription Facility On December 31, 2019, the Company entered into a revolving credit agreement (the “CIBC Subscription Facility”) with CIBC Bank USA as administrative agent and arranger, which was subsequently amended on February 3, 2020 and November 17, 2020. The maximum principal amount of the CIBC Subscription Facility, which was $100.0 million as of December 31, 2019, was increased to $400.0 million on November 17, 2020. The CIBC Subscription Facility allows the Company to borrow up to $400.0 million at any one time outstanding, subject to certain restrictions, including availability under the borrowing base, which is based on unused Capital Commitments. The amount of permissible borrowings under the CIBC Subscription Facility may be increased to up to an aggregate amount of $500.0 million with the consent of the lenders. The CIBC Subscription Facility has a maturity date of December 31, 2022. The CIBC Subscription Facility bears interest at a rate at the Company’s election of either (i) the per annum one-, two-, or three-month LIBOR, divided by a number determined by subtracting from 1.00 the then stated maximum reserve percentage for determining reserves to be maintained by member banks of the Federal Reserve System for Eurocurrency funding or liabilities, plus 1.65% or (ii) the prime rate plus 0.65%, as calculated under the CIBC Subscription Facility. The CIBC Subscription Facility is secured by the unfunded commitments of certain stockholders of the Company. The Company has made customary representations and warranties and is required to comply with various covenants, reporting requirements and other customary requirements for similar credit facilities. The summary information of the CIBC Subscription Facility is as follows: For the Year Ended December 31, 2021 December 31, 2020 Borrowing interest expense $ 6,379 $ 2,247 Facility unused commitment fees 92 406 Amortization of deferred financing costs 1,375 1,072 Total $ 7,846 $ 3,725 Weighted average interest rate (excluding unused fees and financing costs) 1.77 % 1.93 % Weighted average outstanding balance $ 354,810 $ 114,431 During the year ended December 31, 2021 and December 31, 2020, the Company borrowed $431,500 and $612,350, and repaid $455,000 and $278,500, respectively, under the CIBC Subscription Facility. As of December 31, 2021 and December 31, 2020, the Company had $310,350 and $333,850 outstanding under the CIBC Subscription Facility, respectively. As of December 31, 2021 and December 31, 2020, the Company had $89,650 and $66,150, respectively, of available capacity under the CIBC Subscription Facility (subject to borrowing base restrictions). BNP Funding Facility On October 14, 2020, DLF LLC entered into a Revolving Credit and Security Agreement (the “Credit and Security Agreement”, which was subsequently amended on December 11, 2020 and March 2, 2021) with DLF LLC, as the borrower, BNP Paribas (“BNP”), as the administrative agent and lender, the Company, as the equity holder and as the servicer, and U.S. Bank 133 Table of Contents National Association, as collateral agent to (the “BNP Funding Facility”). As of December 31, 2021, the borrowing capacity under the BNP Funding Facility is $600.0 million. The applicable margin on borrowings during the reinvestment period ranges between 1.95% and 2.75% and, after the reinvestment period, between 2.45% and 3.25%. The BNP Funding Facility has a maturity date of October 13, 2025. The summary information of the BNP Funding Facility is as follows: For the Year Ended December 31, 2021 December 31, 2020 Borrowing interest expense $ 8,559 $ — Facility unused commitment fees 69 — Amortization of deferred financing costs 1,073 147 Total $ 9,701 $ 147 Weighted average interest rate (excluding unused fees and financing costs) 2.48 % — % Weighted average outstanding balance $ 340,437 $ — During the year ended December 31, 2021, the Company borrowed $538,500 and repaid $75,000 under the BNP Funding Facility. During the year ended December 31, 2020, the Company did not make any borrowings under the facility. As of December 31, 2021 and December 31, 2020, the Company had $463,500 and $0 outstanding under the BNP Funding Facility, respectively. As of December 31, 2021 and December 31, 2020, the Company had $136,500 and $300,000, respectively, of available capacity under the BNP Funding Facility (subject to borrowing base restrictions). Truist Credit Facilit y On July 16, 2021, the Company entered into a Senior Secured Revolving Credit Agreement with Truist Bank, as amended on December 3, 2021 (the “Truist Credit Facility”). Truist Bank serves as Administrative Agent and Truist Securities, Inc. serves as Joint Lead Arranger and Sole Book Runner. The maximum principal amount of the Truist Credit Facility is $975.0 million, subject to availability under the borrowing base. The Truist Credit Facility includes an uncommitted accordion feature that allows the Company, under certain circumstances, to increase the borrowing capacity to up to $1,000.0 million. The availability period of the Truist Credit Facility will terminate on July 16, 2025. The Truist Credit Facility will mature on July 16, 2026. The Truist Credit Facility is guaranteed by certain domestic subsidiaries of the Company (the “Guarantors”). The Company’s obligations to the lenders under the Truist Credit Facility are secured by a first priority security interest in substantially all of the assets of the Company and each Guarantor, subject to certain exceptions. The Company may borrow amounts in U.S. dollars or certain other permitted currencies. Borrowings under the Truist Credit Facility bear interest at a per annum rate equal to, (x) for loans for which the Company elects the base rate option, the “alternate base rate” (which is the highest of (a) the prime rate as publicly announced by Truist Bank, (b) the sum of (i) the weighted average of the rates on overnight federal funds transactions, as published by the Federal Reserve Bank of New York plus (ii) 0.5%, and (c) one month LIBOR plus 1% per annum) plus either (A) 0.75%, or (B) 0.875%, based on certain borrowing base conditions, and (y) for loans for which the Company elects the Eurocurrency option, the applicable LIBO Rate for the related Interest Period for such Borrowing plus either (A) 1.75% per annum, or (B) 1.875% per annum, based on certain borrowing base conditions. The Company pays an unused fee of 0.375% per annum on the daily unused amount of the revolver commitments. The summary information of the Truist Credit Facility from July 16, 2021 to December 31, 2021 was as follows: From July 16, 2021 to December 31, 2021 Borrowing interest expense $ 2,145 Facility unused commitment fees 858 Amortization of deferred financing costs 465 Total $ 3,468 Weighted average interest rate (excluding unused fees and financing costs) 2.09 % Weighted average outstanding balance (1) $ 218,189 (1) Weighted average outstanding balance calculated for the period from July 16, 2021 to December 31, 2021. 134 Table of Contents From July 16, 2021 to December 31, 2021, the Company borrowed $544,000 and repaid $68,000 under the Truist Credit Facility. As of December 31, 2021, the Company had $499,000 of available capacity under the Truist Credit Facility (subject to borrowing base restrictions). The Company’s debt obligations were as follows. Unused debt capacity of credit facilities were subject to certain borrowing base restrictions: December 31, 2021 December 31, 2020 Aggregate Principal Committed Outstanding Principal Unused Portion Aggregate Principal Committed Outstanding Principal Unused Portion CIBC Subscription Facility $ 400,000 $ 310,350 $ 89,650 $ 400,000 $ 333,850 $ 66,150 BNP Funding Facility 600,000 463,500 136,500 300,000 — 300,000 Truist Credit Facility 975,000 476,000 499,000 — — — Total $ 1,975,000 $ 1,249,850 $ 725,150 $ 700,000 $ 333,850 $ 366,150 The combined weighted average interest rate of the aggregate borrowings outstanding for the year ended December 31, 2021 and the year ended December 31, 2020 was 2.12% and 1.93%. The combined weighted average debt of the aggregate borrowings outstanding for the year ended December 31, 2021 and the year ended December 31, 2020 was $796,272 and $114,431. As of December 31, 2021 and December 31, 2020, the Company was in compliance with all covenants and other requirements of each of the credit facilities. (7) Commitments and Contingencies In the normal course of business, the Company may enter into contracts that provide a variety of general indemnifications. Any exposure to the Company under these arrangements could involve future claims that may be made against the Company. Currently, no such claims exist or are expected to arise and, accordingly, the Company has not accrued any liability in connection with such indemnifications. As of December 31, 2021, the Company had $509,403 unfunded commitments to fund delayed draw and revolving senior secured loans. As of December 31, 2020, the Company had $206,540 unfunded commitments to fund delayed draw and revolving senior secured loans. As of December 31, 2021 and December 31, 2020, the Company had $1,585,531 and $1,445,809, respectively, in total capital commitments from stockholders, of which $425,694 and $1,148,427, respectively, were unfunded. (8) Net Assets The following table shows the components of distributable earnings as shown on the Consolidated Statements of Assets and Liabilities: As of December 31, 2021 As of December 31, 2020 As of December 31, 2019 Net distributable earnings (accumulated losses), beginning of period $ 4,702 $ (1,156) $ — Net investment income/(loss) after taxes 72,929 10,635 (1,156) Accumulated realized gain (loss) 1,895 2,154 — Net unrealized appreciation (depreciation) 8,431 5,508 — Dividend declared (72,315) (13,926) — Tax reclassification of stockholders’ equity (Note 10) 140 1,487 — Net distributable earnings (accumulated losses), end of period $ 15,782 $ 4,702 $ (1,156) The following table summarizes the total shares issued and proceeds received from the Company’s capital drawdowns delivered pursuant to the Subscription Agreements for the year ended December 31, 2021 (dollar amounts in millions): 135 Table of Contents Share Issuance Date Shares Issued Amount January 20, 2021 1,726,689 $ 35.00 March 12, 2021 2,171,816 45.00 April 12, 2021 5,326,877 110.00 May 26, 2021 4,036,582 84.97 July 16, 2021 7,161,130 149.88 October 15, 2021 7,806,514 164.02 November 12, 2021 8,182,294 173.96 December 29, 2021 4,748,891 99.63 Total 41,160,793 $ 862.46 The following table summarizes the total shares issued and proceeds received from the Company’s capital drawdowns delivered pursuant to the Subscription Agreements for the year ended December 31, 2020 (dollar amounts in millions): Share Issuance Date Shares Issued Amount February 5, 2020 2,874,810 $ 57.50 March 27, 2020 2,410,313 44.95 June 26, 2020 769,194 14.95 August 11, 2020 2,002,070 39.98 September 28, 2020 3,504,634 69.99 December 1, 2020 3,410,138 69.98 Total 14,971,159 $ 297.35 The following table summarizes the Company’s distributions declared and payable for the year ended December 31, 2021: Date Declared Record Date Payment Date Per Share Amount Total Amount March 18, 2021 March 18, 2021 April 22, 2021 $ 0.45 $ 8,570 June 23, 2021 June 23, 2021 July 22, 2021 0.49 13,974 September 23, 2021 September 23, 2021 October 27, 2021 0.56 20,080 December 21, 2021 December 21, 2021 January 25, 2022 0.57 (1) 29,691 Total Distributions $ 2.07 $ 72,315 (1) Includes a special distribution of $0.11 per share. The following table summarizes the Company’s distributions declared and payable for the year ended December 31, 2020: Date Declared Record Date Payment Date Per Share Amount Total Amount June 19, 2020 June 19, 2020 July 15, 2020 $ 0.29 $ 1,533 September 24, 2020 September 24, 2020 October 22, 2020 0.40 3,228 December 29, 2020 December 29, 2020 January 27, 2021 0.61 (1) 9,165 Total Distributions $ 1.30 $ 13,926 (1) Includes a special distribution of $0.18 per share. We adopted an “opt in” dividend reinvestment plan, or the DRIP. As a result, our stockholders who elect to “opt in” to the DRIP will have their cash dividends or distributions automatically reinvested in additional shares of Common Stock, rather than receiving cash. Stockholders who receive distributions in the form of shares of Common Stock will generally be subject to the same U.S. federal, state and local tax consequences as if they received cash distributions; however, those stockholders will not receive cash with which to pay any applicable taxes. Shares issued under the DRIP will not reduce an investor’s outstanding capital commitment. The following table summarizes the DRIP shares issued to stockholders who have “opted in” to the DRIP during the year ended December 31, 2021 and the value of such shares as of the payment dates: 136 Table of Contents Payment Date DRIP Shares Value DRIP Shares Issued January 27, 2021 $ 2,462 121,484 April 22, 2021 2,276 110,191 July 22, 2021 3,733 178,345 October 27, 2021 5,101 242,789 Total $ 13,572 652,809 The following table summarizes the DRIP shares issued to stockholders who have “opted in” to the DRIP during the year ended December 31, 2020 and the value of such shares as of the payment dates: Payment Date DRIP Shares Value DRIP Shares Issued July 15, 2020 $ 227 11,668 October 22, 2020 796 39,848 Total $ 1,023 51,516 (9) Earnings Per Share The following table sets forth the computation of basic and diluted earnings per share: For the year ended December 31, 2021 December 31, 2020 (1) Numerator for basic and diluted earnings per share - net increase/(decrease) in net assets resulting from operations $ 83,255 $ 18,297 Denominator for basic and diluted earnings per share - weighted average shares outstanding 31,159,302 7,559,426 Basic and diluted earnings per share $ 2.67 $ 2.42 (1) Calculated for the period from February 5, 2020, the date of first external issuance of shares through December 31, 2020. (10) Income Taxes For income tax purposes, distributions made to the Company’s stockholders are reported as ordinary income, capital gains, or a combination thereof. The tax character of distributions made during the year ended December 31, 2021 were as follows: For the year ended December 31, 2021 For the year ended December 31, 2020 Distributions paid from: Ordinary income (including net short-term capital gains) $ 72,315 $ 13,926 Total taxable distributions $ 72,315 $ 13,926 Taxable income generally differs from net increase in net assets resulting from operations for financial reporting purposes due to temporary and permanent differences in the recognition of income and expenses, and generally excludes net unrealized gains or losses, and incentive fee accrual associated with any unrealized gains, as unrealized gains or losses are generally not included in taxable income until they are realized. For the year ended December 31, 2021, the Company estimated U.S. federal taxable income exceeded its distributions made from such taxable income during the year; consequently, the Company has elected to carry forward the excess for distribution to stockholders in 2022. The amount carried forward to 2022 is estimated to be approximately $4,590, of which $4,586 is expected to be ordinary income and $4 is expected to be capital gains, although these amounts will not be finalized until the 2021 tax returns are filed in 2022. The Company makes certain adjustments to the classification of net assets as a result of permanent book-to-tax differences, which include differences in the book-to-tax treatment of net operating losses, dividend re-designations and timing of the deductibility of certain business expenses, as applicable. To the extent these differences are permanent, they are charged or credited to additional paid-in capital, undistributed net investment income or undistributed net realized gains on investments, as appropriate. 137 Table of Contents The book-to-tax differences relating to distributions made to the Company’s stockholders resulted in reclassifications among certain capital accounts as follows: As of December 31, 2021 December 31, 2020 Paid-in capital in excess of par value $ (140) $ (1,487) Net distributable earnings (accumulated losses) $ 140 $ 1,487 The cost and unrealized gain (loss) on the Company’s consolidated financial instruments, as calculated on a tax basis, at December 31, 2021 are as follows (amounts calculated using book-to-tax differences as of the most recent fiscal year ended December 31, 2021): As of December 31, 2021 December 31, 2020 Gross unrealized appreciation $ 18,635 $ 5,121 Gross unrealized depreciation (4,696) (577) Net unrealized appreciation (depreciation) $ 13,939 $ 4,544 Tax cost of investments at year end $ 2,373,435 $ 632,437 (11) Consolidated Financial Highlights The following are the financial highlights (dollar amounts in thousands, except per share amounts): For the year ended December 31, 2021 December 31, 2020 Per Share Data: (1) Net asset value, beginning of period $ 20.08 $ 20.00 Net investment income (loss) 2.34 1.41 Net unrealized and realized gain (loss) (2) 0.52 (0.28) Net increase (decrease) in net assets resulting from operations 2.86 1.13 Distributions declared (2.07) (1.30) Issuance of common stock 0.04 0.25 Total increase (decrease) in net assets 0.83 0.08 Net asset value, end of period $ 20.91 $ 20.08 Shares outstanding, end of period 56,838,027 15,024,425 Total return based on net asset value (3) 14.83 % 7.07 % Ratio/Supplemental Data (all amounts in thousands except ratios): Net assets, end of period $ 1,188,587 $ 301,620 Weighted average shares outstanding (4) 31,159,302 7,559,426 Ratio of net expenses to average net assets 6.77 % 7.02 % Ratio of expenses before waivers to average net assets 8.26 % 8.20 % Ratio of net investment income to average net assets 10.55 % 6.62 % Asset coverage ratio 195.10 % 190.35 % Portfolio turnover rate 27.18 % 31.11 % (1) The per share data was derived by using the weighted average shares outstanding during the period. (2) For the year ended December 31, 2021 and December 31, 2020, the amount shown does not correspond with the aggregate amount for the period as it includes the effect of the timing of capital transactions. (3) Total return (not annualized) is calculated assuming a purchase of common stock at the opening of the first day of the period and a sale on the closing of the last business day of the period. Dividends and distributions, if any, are assumed for purposes of this calculation, to be reinvested at prices obtained under the Company’s dividend reinvestment plan. (4) For the year ended December 31, 2020, weighted average shares outstanding was calculated for the period from February 5, 2020, the date of first external issuance of shares through December 31, 2020. 138 Table of Contents (12) Subsequent Events Subsequent events have been evaluated through the date the consolidated financial statements were issued. There have been no subsequent events that require recognition or disclosure through the date the consolidated financial statements were issued, except as disclosed below. Effective January 18, 2022, we provided written notice to CIBC of our intent to permanently reduce the amount of the revolving commitment to $315 million from $400 million in accordance with and as permitted under the CIBC Subscription Facility The other terms of the CIBC Subscription Facility were not changed. On February 3, 2022, we entered into Amendment No. 4 and Limited Waiver, dated as of February 3, 2022, to the CIBC Subscription Facility to, among other things, amend certain covenants in the CIBC Subscription Facility and provide for certain limited waivers. All other material terms of the CIBC Subscription Facility remain unchanged. On February 11, 2022, the Company issued $425 million in aggregate principal amount of 4.500% notes due 2027 (the “Notes”). The Notes will mature on February 11, 2027 and may be redeemed in whole or in part at our option at any time or from time to time at the redemption prices set forth in the indenture governing the Notes. The Notes are general unsecured obligations of the Company that rank senior in right of payment to all of the Company’s existing and future indebtedness that is expressly subordinated in right of payment to the Notes, rank pari passu with all existing and future unsecured unsubordinated indebtedness issued by the Company, rank effectively junior to any of the Company’s secured indebtedness (including unsecured indebtedness that the Company later secures) to the extent of the value of the assets securing such indebtedness, and rank structurally junior to all existing and future indebtedness (including trade payables) incurred by the Company’s subsidiaries, financing vehicles or similar facilities. The Notes were offered to persons reasonably believed to be qualified institutional buyers pursuant to Rule 144A under the Securities Act and to certain non-U.S. persons outside the United States pursuant to Regulation S under the Securities Act. In connection with the offering of the Notes, the Company entered into a Registration Rights Agreement, dated as of February 11, 2022 (the “Registration Rights Agreement”), with SMBC Nikko Securities America, Inc., J.P. Morgan Securities LLC, MUFG Securities Americas Inc. and Truist Securities, Inc., as the representatives of the initial purchasers of the Notes. Pursuant to the Registration Rights Agreement, we are obligated to file with the Securities and Exchange Commission a registration statement relating to an offer to exchange the Notes for new notes issued by the Company that are registered under the Securities Act and otherwise have terms substantially identical to those of the Notes, and to use its commercially reasonable efforts to cause such registration statement to be declared effective. If we are not able to effect the exchange offer, we will be obligated to file a shelf registration statement covering the resale of the Notes and use our commercially reasonable efforts to cause such registration statement to be declared effective. If we fail satisfy its registration obligations by certain dates specified in the Registration Rights Agreement, we will be required to pay additional interest to the holders of the Notes. On March 4, 2022, the Company closed new investor commitments of $40.2 million, which brings total Capital Commitments to approximately $1,625.7 million. 139 Table of Contents Item 9. Changes and Disagreements with Accountants on Accounting and Financial Disclosure None.