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DEBT | 3 Months Ended
--- | ---
Mar. 31, 2025
Debt Disclosure [Abstract] |
DEBT | DEBT Summary of MSC Income’s debt as of March 31, 2025 is as follows:
| Outstanding Balance |  | Unamortized Debt Issuance Costs (1) |  | Recorded Value |  | Estimated Fair Value (2)
| (in thousands)
SPV Facility | $ | 260,688 |  |  | $ | — |  |  | $ | 260,688 |  |  | $ | 260,688 |
Corporate Facility | 160,000 |  |  | — |  |  | 160,000 |  |  | 160,000 |
Series A Notes | 150,000 |  |  | (472) |  |  | 149,528 |  |  | 143,879 |
Total Debt | $ | 570,688 |  |  | $ | (472) |  |  | $ | 570,216 |  |  | $ | 564,567 |
_________________ (1)The unamortized debt issuance costs for the Credit Facilities are reflected as Deferred financing costs on the Consolidated Balance Sheets, while the deferred debt issuance costs related to the Series A Notes are reflected as a contra-liability to the Series A Notes on the Consolidated Balance Sheets. (2)Estimated fair value for outstanding debt is shown as if MSC Income had adopted the fair value option under ASC 825. See discussion of the methods used to estimate the fair value of MSC Income’s debt in Note B.10. — Summary of Significant Accounting Policies — Fair Value of Financial Instruments. Summary of MSC Income’s debt as of December 31, 2024 is as follows:
| Outstanding Balance |  | Unamortized Debt Issuance Costs (1) |  | Recorded Value |  | Estimated Fair Value (2)
| (in thousands)
SPV Facility | $ | 266,688 |  |  | $ | — |  |  | $ | 266,688 |  |  | $ | 266,688 |
Corporate Facility | 149,000 |  |  | — |  |  | 149,000 |  |  | 149,000 |
Series A Notes | 150,000 |  |  | (547) |  |  | 149,453 |  |  | 141,892 |
Total Debt | $ | 565,688 |  |  | $ | (547) |  |  | $ | 565,141 |  |  | $ | 557,580 |
___________________ (1)The unamortized debt issuance costs for the Credit Facilities are reflected as Deferred financing costs on the Consolidated Balance Sheets, while the deferred debt issuance costs related to the Series A Notes are reflected as a contra-liability to the Series A Notes on the Consolidated Balance Sheets. (2)Estimated fair value for outstanding debt is shown as if MSC Income had adopted the fair value option under ASC 825. See discussion of the methods used to estimate the fair value of MSC Income’s debt in Note B.10. — Summary of Significant Accounting Policies — Fair Value of Financial Instruments. Summarized interest expense for the three months ended March 31, 2025 and 2024 is as follows:
| Three Months Ended March 31, |  |
| 2025 |  | 2024 |  |  |  |
| (in thousands)
SPV Facility | $ | 4,796 |  |  | $ | 6,046 |  |  |  |  |
Corporate Facility | 1,857 |  |  | 1,913 |  |  |  |  |
Series A Notes | 1,590 |  |  | 1,590 |  |  |  |  |
Total Interest Expense | $ | 8,243 |  |  | $ | 9,549 |  |  |  |  |
A summary of MSC Income’s average amount of total borrowings outstanding and overall weighted-average effective interest rate including amortization of debt issuance costs, original issuance discounts and premiums and fees on unused lender commitments are as follows:
| Three Months Ended March 31, |  |
| 2025 |  | 2024 |  |  |  |
| (dollars in millions)
Weighted-average borrowings outstanding | $ | 511.8 |  |  | $ | 488.9 |  |  |  |  |
Weighted-average effective interest rate | 6.4 | % |  | 7.8 | % |  |  |  |
SPV Facility MSC Income, through MSIF Funding, LLC (“MSIF Funding”), a wholly-owned Structured Subsidiary that primarily holds debt investments, is party to a senior secured revolving credit facility dated February 3, 2021 (as amended, the “SPV Facility”) with JPMorgan Chase Bank, National Association (“JPM”), as administrative agent, and U.S. Bank, N.A., as collateral agent and collateral administrator, JPM and other financial institutions as lenders and MSIF as portfolio manager. In March 2025, the SPV facility was amended to, among other things: (i) decrease the interest rate for advances to the applicable SOFR plus 2.20% from the prior interest rate of the applicable SOFR plus 3.00%, (ii) extend the revolving period from through February 2027 to through February 2029 and (iii) extend the final maturity date from February 2028 to February 2030. As of March 31, 2025, the SPV Facility included (i) total commitments of $300.0 million ,(ii) an accordion feature with the right to request an increase of total commitments and borrowing availability up to $450.0 million and (iii) a revolving period through February 2029 and a final maturity date in February 2030. As of March 31, 2025, advances under the SPV Facility bore interest at a rate equal to the applicable SOFR in effect, plus a margin of 2.20%. MSIF Funding also pays a commitment fee of 0.75% on the average daily unused amount of the financing commitments until February 2029. The SPV Facility is secured by a collateral loan on the assets of MSIF Funding. In connection with the SPV Facility, MSIF Funding has made customary representations and warranties and is required to comply with various covenants, reporting requirements and other customary requirements for similar credit facilities. Our borrowing ability is limited to leverage and borrowing base restrictions imposed by the SPV Facility and the 1940 Act. As of March 31, 2025, the interest rate for borrowings on the SPV Facility was 6.51%. The average interest rate for borrowings under the SPV Facility was 7.24% and 8.33% for the three months ended March 31, 2025 and 2024, respectively. As of March 31, 2025, MSIF Funding was in compliance with all financial covenants of the SPV Facility. Corporate Facility MSC Income is a party to a senior secured revolving credit agreement dated March 6, 2017 (as amended, the “Corporate Facility” and, together with the SPV Facility, the “Credit Facilities”) with EverBank, as administrative agent, and with EverBank and other financial institutions as lenders. In November 2024, the Company entered into an amendment to the Corporate Facility to, among other things: (i) extend the revolving period from through September 2025 to through November 2028, (ii) extend the final maturity date from March 2026 to May 2029 and (iii) reduce the interest rate, subject to MSC Income’s election, to (a) SOFR plus 2.05% or (b) the base rate plus 1.05%. In February 2025, the Company entered into an amendment to the Corporate Facility to, among other things: (i) increase the total commitments from $165.0 million to $245.0 million and (ii) increase the accordion feature from up to a total of $200.0 million to up to a total of $300.0 million. As of March 31, 2025, the Corporate Facility included (i) total commitments of $245.0 million, (ii) an accordion feature with the right to request an increase in commitments under the facility from new and existing lenders on the same terms and conditions as the existing commitments up to $300.0 million of total commitments and (iii) a revolving period through November 2028 and a final maturity date in May 2029, with two one-year extension options subject to lender approval. Borrowings under the Corporate Facility bear interest, subject to MSC Income’s election, at a rate equal to (i) SOFR plus 2.05% or (ii) the base rate plus 1.05%. The base rate is defined as the higher of (a) the Prime rate, (b) the Federal Funds Rate (as defined in the credit agreement) plus 0.5% or (c) SOFR plus 1.0%. Additionally, MSC Income pays an unused commitment fee of 0.25% on the unused lender commitments if more than 50% or more of the lender commitments are being used and an annual unused commitment fee of 0.375% on the unused lender commitments if less than 50% of the lender commitments are being used. Borrowings under the Corporate Facility are secured by a first lien on all of the assets of MSIF and its subsidiaries, excluding the assets of Structured Subsidiaries or immaterial subsidiaries, as well as all of the assets, and a pledge of equity ownership interests, of any future subsidiaries of MSIF (other than Structured Subsidiaries or immaterial subsidiaries). In connection with the Corporate Facility, MSIF has made customary representations and warranties and is required to comply with various covenants, reporting requirements and other customary requirements for similar credit facilities. Our borrowing ability is limited to leverage and borrowing base restrictions imposed by the Corporate Facility and the 1940 Act. As of March 31, 2025, the interest rate for borrowings on the Corporate Facility was 6.37%. The average interest rate for borrowings under the Corporate Facility was 6.38% and 7.84% for the three months ended March 31, 2025 and 2024, respectively. As of March 31, 2025, MSC Income was in compliance with all financial covenants of the Corporate Facility. Series A Notes Pursuant to a Master Note Purchase Agreement dated October 21, 2021 (the “Note Purchase Agreement”), MSC Income issued $77.5 million of 4.04% Series A Senior Notes due 2026 (the “Series A Notes”) upon entering into the Note Purchase Agreement and an additional $72.5 million on January 21, 2022. The Series A Notes bear a fixed interest rate of 4.04% per year and will mature on October 30, 2026, unless redeemed, purchased or prepaid prior to such date by the Company in accordance with their terms. Interest on the Series A Notes is due semiannually on April 30 and October 30 of each year. The Series A Notes may be redeemed in whole or in part at any time or from time to time at MSC Income’s option at par plus accrued interest to the prepayment date and, if applicable, a make-whole premium. In addition, MSC Income is obligated to offer to prepay the Series A Notes at par plus accrued and unpaid interest up to, but excluding, the date of prepayment, if certain change in control events occur. In the event that a Below Investment Grade Event (as defined in the Note Purchase Agreement) occurs, the Series A Notes will bear interest at a fixed rate of 5.04% per year from the date of the occurrence of the Below Investment Grade Event to and until the date on which the Below Investment Grade Event ends. The Series A Notes are general unsecured obligations of MSIF that rank pari passu with all outstanding and future unsecured unsubordinated indebtedness issued by MSIF. The Note Purchase Agreement also contains customary events of default with customary cure and notice periods, including, without limitation, nonpayment, incorrect representation in any material respect, breach of covenant, cross-default under other indebtedness of MSIF or subsidiary guarantors subject to a cure pass-through, certain judgments and orders and certain events of bankruptcy. As of March 31, 2025, MSC Income was in compliance with all financial covenants of the Note Purchase Agreement.

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