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Morgan Stanley Direct Lending issues 2031 notes

Morgan Stanley Direct Lending Fund entered into a Fourth Supplemental Indenture to issue $350.0 million of 6.100% notes due 2031.

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

Rhea-AI Filing Summary

Morgan Stanley Direct Lending Fund entered into a Fourth Supplemental Indenture to issue $350.0 million of 6.100% notes due 2031. The notes mature on July 15, 2031 and can be redeemed at par plus a make-whole premium before June 15, 2031, and at par on or after that date.

The notes are unsecured senior obligations, ranking ahead of subordinated debt and alongside other unsecured unsubordinated debt, but behind secured and subsidiary-level obligations. Net proceeds of approximately $341.6 million will be used to repay outstanding secured indebtedness, shifting the company’s funding mix toward unsecured debt.

To align borrowing costs with its predominantly floating rate loan portfolio, the company entered into interest rate swaps on $350.0 million of the notes, receiving the 6.100% fixed rate and paying SOFR plus 2.1945% under hedge accounting treatment.

Positive

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Insights

MSDL refinances with $350.0M unsecured notes and hedges rate risk.

Morgan Stanley Direct Lending Fund issued $350.0 million of 6.100% notes due 2031, replacing secured borrowings with longer-dated unsecured debt. This can simplify collateral arrangements and extends the company’s liability profile to July 15, 2031.

The notes are senior unsecured, ranking ahead of subordinated obligations but effectively behind secured and subsidiary-level debt. Covenants tie leverage to Investment Company Act asset coverage tests, which helps limit over-leverage but still allows flexibility within those thresholds.

The company also executed interest rate swaps on $350.0 million of principal, receiving the 6.100% fixed coupon and paying SOFR + 2.1945%. With hedge accounting, results should better reflect its predominantly floating rate loan portfolio, though actual benefit depends on future SOFR levels.

Item 1.01 Entry into a Material Definitive Agreement Business
The company signed a significant contract such as a merger agreement, credit facility, or major partnership.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement Financial
The company incurred a new significant debt or off-balance-sheet obligation.
Item 9.01 Financial Statements and Exhibits Exhibits
Financial statements, pro forma financial information, or exhibit attachments filed with this report.
Notes issued $350.0 million Aggregate principal amount of 6.100% notes due 2031
Coupon rate 6.100% per year Fixed interest rate on notes, paid semi-annually
Maturity date July 15, 2031 Final maturity of the notes
Net proceeds $341.6 million After underwriting discount and estimated offering expenses
Swap notional $350.0 million Principal amount hedged with interest rate swaps
Swap floating leg SOFR + 2.1945% Rate paid under interest rate swap related to notes
First interest payment January 15, 2027 Initial semi-annual coupon payment date
Par call date June 15, 2031 Date from which notes are redeemable at par value
Fourth Supplemental Indenture regulatory
"entered into a Fourth Supplemental Indenture (the “Fourth Supplemental Indenture”) to the Indenture"
make-whole premium financial
"may be redeemed ... at par value plus a “make-whole” premium calculated in accordance with terms under “optional redemption”"
A make-whole premium is an extra payment a borrower must give bondholders when repaying debt early to compensate them for lost future interest; think of it as a lump-sum “catch-up” to leave lenders financially where they would have been if the loan had run its full term. It matters to investors because it affects how much they receive on early redemption and influences a company’s decision to refinance or repay debt, altering bond value and expected returns.
change of control repurchase event financial
"on the occurrence of a “change of control repurchase event,” as defined in the Indenture, the Company will generally be required to make an offer"
A change of control repurchase event happens when a company is sold or otherwise taken over and that sale triggers contractual rights for holders of stock, options, or debt to force the company to buy their securities back for cash. Think of it like a lease that lets the tenant cash out when the building is sold: it gives certain investors a predictable exit price and timeline. This matters because it can change who owns the company, alter cash on hand, affect future returns and dilution, and influence how attractive a takeover or investment looks.
asset coverage requirements regulatory
"covenants requiring the Company to comply with the asset coverage requirements of Section 18(a)(1)(A) as modified by Section 61(a)(1) and (2)"
A rule or covenant that specifies the minimum value of a company’s assets that must be held to back its debts, obligations or issued securities. It’s like a lender or regulator asking someone to keep enough cash in the bank to cover outstanding loans; for investors, stronger asset coverage means lower risk of loss if the company faces trouble, while weak coverage raises default or dilution concerns.
interest rate swap financial
"entered into interest rate swaps to more closely align the interest rates of the Company’s liabilities with the Company’s investment portfolio"
An interest rate swap is a financial agreement where two parties exchange interest payments on a set amount of money over time. Typically, one side pays a fixed interest rate, while the other pays a variable rate that can change with market conditions. This helps investors manage or reduce their exposure to interest rate fluctuations, much like locking in a mortgage rate to avoid future cost increases.

FAQ

What debt did Morgan Stanley Direct Lending Fund (MSDL) issue in this 8-K?
Morgan Stanley Direct Lending Fund issued $350.0 million of 6.100% notes due 2031. The notes mature on July 15, 2031, pay semi-annual interest each January 15 and July 15, and are unsecured senior obligations ranking ahead of subordinated debt.

What are the key terms of MSDL’s 6.100% notes due 2031?
The notes pay 6.100% annually and mature July 15, 2031. Interest is payable semi-annually on January 15 and July 15, starting January 15, 2027. The company may redeem them early at par plus a make-whole premium, or at par from June 15, 2031 onward.

How will Morgan Stanley Direct Lending Fund use the $350.0 million note proceeds?
Net proceeds of approximately $341.6 million will repay secured indebtedness. After underwriting discounts and estimated offering expenses, the company plans to use the cash to reduce outstanding secured financing arrangements, effectively shifting borrowing toward unsecured term debt.

How do MSDL’s new notes rank relative to its other obligations?
The notes are general unsecured senior obligations of the company. They rank senior to expressly subordinated indebtedness, pari passu with other unsecured unsubordinated debt, effectively junior to secured debt to the value of collateral, and structurally junior to subsidiary-level liabilities.

Does the 6.100% notes issuance include change of control protections for MSDL investors?
Yes, the notes include a change of control repurchase feature. Upon a defined “change of control repurchase event,” the company generally must offer to repurchase affected notes at 100% of principal plus accrued and unpaid interest to the repurchase date.

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false0001782524NY 0001782524 2026-07-09 2026-07-09 iso4217:USD xbrli:pure
 
 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
 
FORM
8-K
 
 
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): July 9, 2026
 
 
Morgan Stanley Direct Lending Fund
(Exact name of registrant as specified in its charter)
 
 
 
Delaware
  
814-01332
  
84-2009506
(State or other jurisdiction
of incorporation)
  
(Commission
File Number)
  
(IRS Employer
Identification Number)
 
1585 Broadway
New York,
NY
  
10036
(Address of principal executive offices)
  
(Zip Code)
1 (212)
761-4000
(Registrant’s telephone number, including area code)
Not Applicable
(Former Name or Former Address, if changed since last report)
 
 
Check the appropriate box below if the Form
8-K
filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
 
  ☐
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
  ☐
Soliciting material pursuant to Rule
14a-12
under the Exchange Act (17 CFR
240.14a-12)
 
  ☐
Pre-commencement
communications pursuant to Rule
14d-2(b)
under the Exchange Act (17 CFR
240.14d-2(b))
 
  ☐
Pre-commencement
communications pursuant to Rule
13e-4(c)
under the Exchange Act (17 CFR
240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
 
Title of each class
  
Trading
Symbol(s)
  
Name of each exchange
on which registered
Common Stock, par value $0.001 per share
  
MSDL
  
The New York Stock Exchange
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule
12b-2
of the Securities Exchange Act of 1934
(§240.12b-2
of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
 
 
 
Item 1.01. Entry into a Material Definitive Agreement.
On July 9, 2026, Morgan Stanley Direct Lending Fund (the “Company”) and U.S. Bank Trust Company, National Association (the “Trustee”), entered into a Fourth Supplemental Indenture (the “Fourth Supplemental Indenture”) to the Indenture between the Company and the Trustee, dated February 11, 2022 (the “Base Indenture,” and together with the Fourth Supplemental Indenture, the “Indenture”). The Fourth Supplemental Indenture relates to the Company’s issuance of $350.0 million aggregate principal amount of its 6.100% notes due 2031 (the “Notes”).
The Notes will mature on July 15, 2031 and may be redeemed in whole or in part at the Company’s option at any time prior to June 15, 2031 at par value plus a “make-whole” premium calculated in accordance with terms under “optional redemption” in the Indenture and at par value on June 15, 2031 or thereafter. The Notes bear interest at a rate of 6.100% per year payable semi-annually on January 15 and July 15 of each year, commencing on January 15, 2027. 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 Indenture contains certain covenants, including covenants requiring the Company to comply with the asset coverage requirements of Section 18(a)(1)(A) as modified by Section 61(a)(1) and (2) of the Investment Company Act of 1940, as amended, whether or not it is subject to those requirements, and to provide financial information to the holders of the Notes and the Trustee if the Company is no longer subject to the reporting requirements under the Securities Exchange Act of 1934, as amended. These covenants are subject to important limitations and exceptions that are described in the Indenture.
In addition, on the occurrence of a “change of control repurchase event,” as defined in the Indenture, the Company will generally be required to make an offer to repurchase the outstanding Notes at a price equal to 100% of the principal amount of such Notes plus accrued and unpaid interest to the repurchase date.
The Notes were offered and sold in an offering registered under the Securities Act of 1933, as amended, pursuant to the Registration Statement on
Form
N-2
(File
No. 333-283477)
(the “Registration Statement”), the preliminary prospectus supplement dated June 29, 2026 and the pricing term sheet filed with the Securities and Exchange Commission on June 29, 2026. The transaction closed on July 9, 2026. The net proceeds to the Company were approximately $341.6 million, after deducting the underwriting discount and estimated offering expenses. The Company intends to use the net proceeds to repay outstanding secured indebtedness under its financing arrangements.
The foregoing descriptions of the Fourth Supplemental Indenture and the Notes do not purport to be complete and are qualified in their entirety by reference to the full text of the Fourth Supplemental Indenture and the Notes, respectively, each filed as exhibits hereto and incorporated by reference herein.
In connection with the issuance of the Notes, the Company entered into interest rate swaps to more closely align the interest rates of the Company’s liabilities with the Company’s investment portfolio, which consists of predominately floating rate loans. Under the interest rate swap agreement related to the Notes, the Company receives a fixed interest rate of 6.100% per annum and pays a floating interest rate of SOFR + 2.1945% per annum on $350.0 million of the Notes. The Company designated each interest rate swap as the hedging instrument in a qualifying hedge accounting relationship.
Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an
Off-Balance
Sheet Arrangement of a Registrant.
The information required by Item 2.03 contained in Item 1.01 of this Current Report on Form
8-K
is incorporated herein by reference.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits:
 
Exhibit
Number
    Description
  4.1    Indenture, dated as of February 11, 2022, by and between the Company and U.S. Bank Trust Company, National Association, as trustee (Incorporated by reference to Exhibit 4.1 of the Company’s Current Report on Form 8-K, filed on February 11, 2022).
  4.2    Fourth Supplemental Indenture, dated July 9, 2026, relating to the 6.100% Notes due 2031, by and between the Company and U.S. Bank Trust Company, National Association, as trustee.
  4.3    Form of 6.100% Notes due 2031 (Incorporated by reference to Exhibit 4.2 hereto).
  5.1    Opinion of Dechert LLP.
 23.1    Consent of Dechert LLP (included in Exhibit 5.1).
 104    Cover page interactive data file (formatted as Inline XBRL).
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
Dated: July 9, 2026     MORGAN STANLEY DIRECT LENDING FUND
    By:  
/s/ David Pessah
      David Pessah
     
Chief Financial Officer

Source: View Original Filing on SEC EDGAR

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