Carlyle Secured Lending, Inc.

Previous wording

We use words such as “anticipates,” “believes,” “expects,” “intends,” “will,” “should,” “may,” “plans,” “continue,” “believes,” “seeks,” “estimates,” “would,” “could,” “targets,” “projects,” “outlook,” “potential,” “predicts” and variations of these words and similar expressions to identify forward-looking statements, although not all forward-looking statements include these words. Our actual results and condition could differ materially from those implied or expressed in the forward-looking information for any reason, including the factors set forth in “Risk Factors” in Part I, Item 1A of our annual report on Form 10-K for the year ended December 31, 2024 (our “2024 Form 10-K”).

Current wording

We use words such as “anticipates,” “believes,” “expects,” “intends,” “will,” “should,” “may,” “plans,” “continue,” “believes,” “seeks,” “estimates,” “would,” “could,” “targets,” “projects,” “outlook,” “potential,” “predicts” and variations of these words and similar expressions to identify forward-looking statements, although not all forward-looking statements include these words. Our actual results and condition could differ materially from those implied or expressed in the forward-looking information for any reason, including the factors set forth in “Risk Factors” in this report and in Part I, Item 1A of our annual report on Form 10-K for the year ended December 31, 2024 (our “2024 Form 10-K”).

Previous wording

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with Part I, Item 1 of this Form 10-Q “Financial Statements and Supplementary Data.” This discussion contains forward-looking statements and involves numerous risks and uncertainties, including, but not limited to those described in “Risk Factors” in Part I, Item 1A of our 2024 Form 10-K. Our actual results could differ materially from those anticipated by such forward-looking statements due to factors discussed under “Risk Factors” and “Cautionary Statement Regarding Forward-Looking Statements” appearing elsewhere in this Form 10-Q.

Current wording

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with Part I, Item 1 of this Form 10-Q “Financial Statements and Supplementary Data.” This discussion contains forward-looking statements and involves numerous risks and uncertainties, including, but not limited to, those described in “Risk Factors” set forth in this report and in Part I, Item 1A of our 2024 Form 10-K. Our actual results could differ materially from those anticipated by such forward-looking statements due to factors discussed under “Risk Factors” and “Cautionary Statement Regarding Forward-Looking Statements” appearing elsewhere in this Form 10-Q.

Previous wording

We are externally managed by our Investment Adviser, an investment adviser registered under the Investment Advisers Act of 1940, as amended (together with the rules and regulations promulgated thereunder, the “Investment Company Act”) and a subsidiary of Carlyle. We benefit from our Investment Adviser’s investment team of over 190 investment professionals with the deep knowledge and expertise across multiple asset classes who are supported by a team of finance, operations and administrative professionals currently employed by Carlyle Employee Co., a wholly owned subsidiary of Carlyle. In conducting our investment activities, we believe that we benefit from the significant scale, relationships and resources of Carlyle, including our Investment Adviser and its affiliates.

Current wording

We are externally managed by our Investment Adviser, an investment adviser registered under the Investment Advisers Act of 1940, as amended (together with the rules and regulations promulgated thereunder, the “Investment Company Act”) and a subsidiary of Carlyle. We benefit from our Investment Adviser’s investment team of over 195 investment professionals with the deep knowledge and expertise across multiple asset classes who are supported by a team of finance, operations and administrative professionals currently employed by Carlyle Employee Co., a wholly owned subsidiary of Carlyle. In conducting our investment activities, we believe that we benefit from the significant scale, relationships and resources of Carlyle, including our Investment Adviser and its affiliates.

Previous wording

•Adjusted for the financial impact of the purchase premium attributed to the CSL III Merger and purchase discount attributed to the Credit Fund II Purchase, the adjusted net investment income per common share (a non-GAAP financial measure) was $0.41. Refer to the Adjusted Net Investment Income and Adjusted Net Income discussion within this section for further details.

Current wording

•Adjusted for the financial impact of the purchase premium attributed to the CSL III Merger and purchase discount attributed to the Credit Fund II Purchase, the adjusted net investment income per common share (a non-GAAP financial measure) was $0.39. Refer to the Adjusted Net Investment Income and Adjusted Net Income discussion within this section for further details.

Previous wording

•Dividends declared on common shares were $22.9 million, or $0.45 per share.

Current wording

•Dividends declared on common shares were $29.2 million, or $0.40 per share.

Previous wording

For the three months ended March 31, 2025 and March 31, 2024

Current wording

•Net investment income for the three months ended June 30, 2025 increased from the comparable period in the prior year, primarily due to a higher average outstanding investment balance due to net origination activity in 2025, including assets acquired in the CSL III Merger and the Credit Fund II Purchase in the first quarter of 2025. This was partially offset by lower yields on investments.

Previous wording

•The NAV per common share decreased to $16.63 as of March 31, 2025, from $16.80 as of December 31, 2024.

Current wording

•The NAV per common share decreased to $16.43 as of June 30, 2025 from $16.63 as of March 31, 2025.

Previous wording

•As of March 31, 2025, we held 195 investments across 138 portfolio companies and 28 industries for a total fair value of $2.2 billion.

Current wording

•As of June 30, 2025, we held 202 investments across 148 portfolio companies and 28 industries for a total fair value of $2.3 billion.

Previous wording

•As of March 31, 2025, non-accrual investments represented 2.2% and 1.6% of our portfolio based on cost and fair value, respectively.

Current wording

•As of June 30, 2025, non-accrual investments represented 3.0% and 2.1% of our portfolio based on cost and fair value, respectively.

Previous wording

•Total liquidity as of March 31, 2025 was $858.5 million in cash and undrawn debt capacity.

Current wording

•Total liquidity as of June 30, 2025 was $613.1 million in cash and undrawn debt capacity.

Previous wording

As a BDC, we believe that the key components of our results of operations for our business are earnings per share, dividends declared, net investment income and net asset value per common share. For the three months ended March 31, 2025, we recorded basic earnings per common share of $0.25, declared a dividend of $0.45 per common share and earned $0.40 of net investment income per common share.

Current wording

As a BDC, we believe that the key components of our results of operations for our business are earnings per share, dividends declared, net investment income and net asset value per common share. For the three months ended June 30, 2025, we recorded basic earnings per common share of $0.20, declared a dividend of $0.40 per common share and earned $0.39 of net investment income per common share.

Previous wording

For the three months ended March 31, 2025 and December 31, 2024, we declared dividends per common share of $0.45 and $0.45, respectively. As of March 31, 2025 and December 31, 2024, our NAV per share was $16.63 and $16.80, respectively.

Current wording

For the three months ended June 30, 2025 and March 31, 2025, we declared dividends per common share of $0.40 and $0.45, respectively. As of June 30, 2025 and December 31, 2024, our NAV per share was $16.43 and $16.80, respectively.

Previous wording

Our primary operating expenses include: (i) investment advisory fees, including base management fees and incentive fees, to our Investment Adviser pursuant to the Investment Advisory Agreement; (ii) debt service and other costs of borrowings or other financing arrangements; (iii) costs and other expenses and our allocable portion of overhead incurred by our

Current wording

Our primary operating expenses include: (i) investment advisory fees, including base management fees and incentive fees, to our Investment Adviser pursuant to the Investment Advisory Agreement; (ii) debt service and other costs of borrowings or other financing arrangements; (iii) costs and other expenses and our allocable portion of overhead incurred by our Administrator in performing its administrative obligations under the Administration Agreement; and (iv) other operating expenses summarized below:

Previous wording

On a supplemental basis, we are disclosing Adjusted Net Investment Income, Adjusted Net Investment Income Per Common Share, Adjusted Net Income and Adjusted Net Income Per Common Share each of which is calculated and presented on a basis other than in accordance with GAAP (“non-GAAP”). We use these non-GAAP financial measures internally to analyze and evaluate financial results and performance, and we believe these non-GAAP financial measures are useful to investors as an additional tool to evaluate our ongoing results and trends and to review our performance without giving effect to (i) the amortization/accretion resulting from the new cost basis of the investments acquired and accounted for under the acquisition method of accounting in accordance with ASC 805 and (ii) the purchase one-time or non-recurring investment income and expense events, including the effects on incentive fees. The presentation of these non-GAAP measures is not intended to be a substitute for financial results prepared in accordance with GAAP and should not be considered in isolation.

Current wording

On a supplemental basis, we are disclosing Adjusted Net Investment Income, Adjusted Net Investment Income Per Common Share, Adjusted Net Income and Adjusted Net Income Per Common Share each of which is calculated and presented on a basis other than in accordance with GAAP (“non-GAAP”). We use these non-GAAP financial measures internally to analyze and evaluate financial results and performance, and we believe these non-GAAP financial measures are useful to investors as an additional tool to evaluate our ongoing results and trends and to review our performance without giving effect to (i) the amortization/accretion resulting from the new cost basis of the investments acquired and accounted for under the acquisition method of accounting in accordance with ASC 805 and (ii) the one-time purchase or non-recurring investment income and expense events, including the effects on incentive fees. The presentation of these non-GAAP measures is not intended to be a substitute for financial results prepared in accordance with GAAP and should not be considered in isolation.

Previous wording

(1)Represents the difference between GAAP amortization under the asset acquisition method of accounting in accordance with ASC 850 and management’s non-GAAP measure of amortization related to assets acquired in connection with the CSL III Merger on March 27, 2025, and the Credit Fund II Purchase on February 11, 2025. This adjustment reflects management’s view of the economic yield on the acquired assets and is consistent with the internal evaluation of performance.

Current wording

(1)This adjustment represents the difference between GAAP amortization under the asset acquisition method of accounting, in accordance with ASC 850 and management’s non-GAAP measure of amortization related to assets acquired in connection with the CSL III Merger on March 27, 2025, and the Credit Fund II Purchase on February 11, 2025. This adjustment reflects management’s view of the economic yield on the acquired assets and is consistent with the internal evaluation of performance.

Previous wording

(1)Weighted average yields include the effect of accretion of discounts and amortization of premiums and are based on interest rates as of March 31, 2025. Weighted average yield at fair value is computed as (a) the annual stated interest rate or yield earned plus the net annual amortization of original issue discount (“OID”) and market discount earned, divided by (b) total fair value included in such securities. Weighted average yield at amortized cost is computed as (a) the annual stated interest rate or yield earned plus the net annual amortization of OID and market discount earned, divided by (b) total amortized cost included in such securities. Weighted average yields exclude investments on non-accrual status. Actual yields earned over the life of each investment could differ materially from the yields presented above. Inclusive of all debt and income producing investments and investments on non-accrual status, the weighted average yield on amortized cost was 10.7% as of March 31, 2025.

Current wording

(1)Weighted average yields include the effect of accretion of discounts and amortization of premiums and are based on interest rates as of June 30, 2025. Weighted average yield at fair value is computed as (a) the annual stated interest rate or yield earned plus the net annual amortization of original issue discount (“OID”) and market discount earned, divided by (b) total fair value included in such securities. Weighted average yield at amortized cost is computed as (a) the annual stated interest rate or yield earned plus the net annual amortization of OID and market discount earned, divided by (b) total amortized cost included in such securities. Weighted average yields exclude investments on non-accrual status. Actual yields earned over the life of each investment could differ materially from the yields presented above. Inclusive of all debt and income producing investments and investments on non-accrual status, the weighted average yield on amortized cost was 10.6% as of June 30, 2025.

Previous wording

(2)Weighted average yield for total investments includes Credit Fund, as well as income producing equity investments.

Current wording

(2)Weighted average yield for total debt and income producing investments includes Credit Fund, as well as income producing equity investments.

Previous wording

(3)Represents commitments to a portfolio company as part of an individual transaction.

Current wording

(2)Represents commitments to a portfolio company as part of an individual transaction.

Previous wording

(4)For the three months ended March 31, 2025, 100.0% of new funded debt investments were at floating interest rates.

Current wording

(3)For the three months ended June 30, 2025, 100.0% of new funded debt investments were at floating interest rates.

Previous wording

As part of the monitoring process, our Investment Adviser has developed risk assessment policies pursuant to which it regularly assesses the risk profile of each of our debt investments and rates each of them based on the following categories, which we refer to as “Internal Risk Ratings”. Key drivers of internal risk ratings include financial metrics, financial covenants, liquidity and enterprise value coverage. Pursuant to these risk policies, an Internal Risk Rating of 1 – 5, which are defined below, is assigned to each debt investment in our portfolio.

Current wording

As part of the monitoring process, our Investment Adviser has developed risk assessment policies pursuant to which it regularly assesses the risk profile of each of our first lien and second lien debt investments and rates each of them based on the following categories, which we refer to as “Internal Risk Ratings”. Key drivers of internal risk ratings include financial metrics, financial covenants, liquidity and enterprise value coverage. Pursuant to these risk policies, an Internal Risk Rating of 1 – 5, which are defined below, is assigned to each first lien and second lien debt investment in our portfolio.

Previous wording

Our Investment Adviser monitors and, when appropriate, changes the risk ratings assigned to each debt investment in our portfolio. Our Investment Adviser reviews our investment ratings in connection with our quarterly valuation process. The below table summarizes the Internal Risk Ratings as of March 31, 2025 and December 31, 2024.

Current wording

Our Investment Adviser monitors and, when appropriate, changes the risk ratings assigned to each first lien and second lien debt investment in our portfolio. Our Investment Adviser reviews our investment ratings in connection with our quarterly valuation process. The below table summarizes the Internal Risk Ratings as of June 30, 2025 and December 31, 2024.

Previous wording

As of March 31, 2025 and December 31, 2024, the weighted average Internal Risk Rating of our debt investment portfolio was 2.1. As of March 31, 2025 and December 31, 2024, four and three of our debt investments were assigned an Internal Risk Rating of 4 or 5, respectively.

Current wording

As of June 30, 2025 and December 31, 2024, the weighted average Internal Risk Rating of our first lien and second lien debt investment portfolio was 2.1. As of June 30, 2025 and December 31, 2024, five and three of our first lien and second lien debt investments were assigned an Internal Risk Rating of 4 or 5, respectively.

Previous wording

On March 21, 2014, we closed on a senior secured revolving credit facility (the “Credit Facility”), which was most recently amended and restated on March 12, 2025, and may be further amended from time to time. The maximum principal amount of the Credit Facility is $935,000, pursuant to the terms of the agreement, subject to availability under the Credit Facility, which is based on certain advance rates multiplied by the value of our portfolio investments (subject to certain concentration limitations) net of certain other indebtedness that we may incur in accordance with the terms of the Credit Facility. Proceeds of the Credit Facility may be used for general corporate purposes, including the funding of portfolio investments. Maximum capacity under the Credit Facility may be increased, subject to certain conditions, to $1,402,500 through the exercise by us of an uncommitted accordion feature through which existing and new lenders may, at their option, agree to provide additional financing. The Credit Facility includes a $75,000 limit for swingline loans and a $30,000 limit for letters of credit. Subject to certain exceptions, the Credit Facility is secured by a first lien security interest in substantially all of the portfolio investments held by us. The Credit Facility includes customary covenants, including certain financial covenants related to asset coverage, stockholders’ equity and liquidity, certain limitations on the incurrence of additional indebtedness and liens, and other maintenance covenants, as well as usual and customary events of default for senior secured revolving credit facilities of this nature.

Current wording

On March 21, 2014, we closed on a senior secured revolving credit facility (the “Credit Facility”), which was most recently amended and restated on March 12, 2025, and may be further amended from time to time. On July 10, 2025, we increased the total commitments under the Credit Facility by $25,000 pursuant to the terms of the agreement, resulting in total commitments increasing to $960,000 ($935,000 prior to the July 10, 2025 increase), pursuant to the terms of the agreement, subject to availability under the Credit Facility, which is based on certain advance rates multiplied by the value of our portfolio investments (subject to certain concentration limitations) net of certain other indebtedness that we may incur in accordance with the terms of the Credit Facility. Proceeds of the Credit Facility may be used for general corporate purposes, including the funding of portfolio investments. Maximum capacity under the Credit Facility may be increased, subject to certain conditions, to $1,402,500 through the exercise by us of an uncommitted accordion feature through which existing and new lenders may, at their option, agree to provide additional financing. The Credit Facility includes a $75,000 limit for swingline loans and a $30,000 limit for letters of credit. Subject to certain exceptions, the Credit Facility is secured by a first lien security interest in substantially all of the portfolio investments held by us. The Credit Facility includes customary covenants, including certain financial covenants related to asset coverage, stockholders’ equity and liquidity, certain limitations on the incurrence of additional indebtedness and liens, and other maintenance covenants, as well as usual and customary events of default for senior secured revolving credit facilities of this nature.

Previous wording

Since inception of Credit Fund and through March 31, 2025, we and Credit Partners each made capital contributions of $1 in members’ equity and $216,000 in subordinated loans to Credit Fund. On March 24, 2025, the Company and Credit Partners each received an aggregate return of capital on subordinated loans of $62,500. Since inception, the Company and Credit Partners each have received an aggregate return of capital on subordinated loans of $85,500. The cost and fair value of our investment in Credit Fund was $130,501 and $121,391, respectively, as of March 31, 2025 and $193,001 and $182,636, respectively, as of December 31, 2024.

Current wording

Since inception of Credit Fund and through June 30, 2025, we and Credit Partners each made capital contributions of $1 in members’ equity and $216,000 in subordinated loans to Credit Fund. On March 24, 2025, the Company and Credit Partners each received an aggregate return of capital on subordinated loans of $62,500. Since inception, the Company and Credit Partners each have received an aggregate return of capital on subordinated loans of $85,500. The cost and fair value of our investment in Credit Fund was $130,501 and $120,164, respectively, as of June 30, 2025 and $193,001 and $182,636, respectively, as of December 31, 2024.

Previous wording

Our portion of the dividends declared by Credit Fund was $5,500 for both the three months ended March 31, 2025 and 2024. As of March 31, 2025 and December 31, 2024, our annualized dividend yield from Credit Fund was 11.7% and 11.4%, respectively. Below is a summary of Credit Fund’s portfolio as of March 31, 2025 and December 31, 2024:

Current wording

Our share of the dividends declared by Credit Fund was $5,000 for the three months ended June 30, 2025 and $5,500 for the three months ended March 31, 2025. As of June 30, 2025 and March 31, 2025, our annualized dividend yield from Credit Fund was 15.3% and 11.7%, respectively. Below is a summary of Credit Fund’s portfolio as of June 30, 2025 and December 31, 2024:

Previous wording

The following table sets forth information regarding our consolidated results of operations for the three months ended month periods ending March 31, 2025 and March 31, 2024:

Current wording

The following table sets forth information regarding our consolidated results of operations for the three months ended June 30, 2025 and March 31, 2025:

Previous wording

The decrease in investment income for the three months ended March 31, 2025 as compared to the three months ended March 31, 2024 was primarily due to lower yields on the portfolio driven by the combination of lower base rates, lower new issue spreads, the repricing of existing loans and an increase in non-accruals. As of March 31, 2025, the size of our portfolio increased to $2,273,998 from $1,829,575 as of March 31, 2024, at amortized cost. As of March 31, 2025 and March 31, 2024, the weighted average yield of our total debt and income producing investments was 10.9% and 12.6%, respectively, based on amortized cost.

Current wording

The increase in investment income for the three months ended June 30, 2025, as compared to the three months ended March 31, 2025, was primarily driven by a higher average outstanding investment balance due to net origination activity in 2025, including assets acquired in the CSL III Merger and the Credit Fund II Purchase. As of June 30, 2025, the size of our portfolio increased to $2,366,445 from $2,273,998 as of March 31, 2025, at amortized cost. As of both June 30, 2025 and March 31, 2025, the weighted average yield of our total debt and income producing investments was 10.9%, based on amortized cost.

Previous wording

Interest income and PIK income on our first and second lien debt investments are dependent on the composition and credit quality of the portfolio. Generally, we expect the portfolio to generate predictable quarterly interest income based on the terms stated in each loan’s credit agreement. As of March 31, 2025 and March 31, 2024, five and one of our income producing investments were on non-accrual status, respectively. Non-accrual investments had a fair value of $36,622 and $3,792, which represented approximately 1.6% and 0.2% of total investments at fair value as of March 31, 2025 and March 31, 2024, respectively. The remaining income producing investments were performing and current on their interest payments as of March 31, 2025 and March 31, 2024.

Current wording

Interest income and PIK income on our first and second lien debt investments are dependent on the composition and credit quality of the portfolio. Generally, we expect the portfolio to generate predictable quarterly interest income based on the terms stated in each loan’s credit agreement. As of June 30, 2025 and March 31, 2025, six and five of our debt and preferred equity investments were on non-accrual status, respectively. Non-accrual investments had a fair value of $48,069 and $36,622, which represented approximately 2.1% and 1.6% of total investments at fair value as of June 30, 2025 and March 31, 2025, respectively. The remaining income producing investments were performing and current on their interest payments as of June 30, 2025 and March 31, 2025.

Previous wording

The decrease in other income for the three months ended March 31, 2025 compared to the three months ended March 31, 2024 was primarily driven by lower amendment and prepayment fees.

Current wording

The increase in other income for the three months ended June 30, 2025, compared to the three months ended March 31, 2025, was primarily driven by an increase in amendment fees.

Previous wording

The increase in interest expense and credit facility fees was primarily driven by higher outstanding borrowings during the three months ended March 31, 2025, as well as the repayment of the 2024 Notes at the end of the prior quarter, which were issued in a low interest rate environment.

Current wording

The increase in interest expense and credit facility fees was primarily driven by higher outstanding borrowings during the three months ended June 30, 2025, resulting from liabilities assumed in connection with the CSL III Merger.

Previous wording

The increase in base management fees was driven by higher average gross assets as a result of the Credit Fund II Purchase and CSL III Merger for the three months ended March 31, 2025 compared to the three months ended December 31, 2024.

Current wording

The increase in base management fees was driven by higher average gross assets as a result of the assets acquired in the CSL III Merger and the Credit Fund II Purchase for the three months ended June 30, 2025 compared to the three months ended March 31, 2025.

Previous wording

The decrease in incentive fees was driven by lower pre-incentive fee net investment income for the three months ended March 31, 2025 compared to the three months ended December 31, 2024.

Current wording

The increase in incentive fees was driven by higher pre-incentive fee net investment income for the three months ended June 30, 2025 compared to the three months ended March 31, 2025.

Previous wording

During the three months ended March 31, 2025, we recognized a realized loss related to the restructuring of our investment in Aimbridge Acquisition Co., Inc. from debt to equity and the consolidation of our investment in Credit Fund II as a result of the Credit Fund II Purchase. During the three months ended December 31, 2024, we recognized a realized loss related to the restructuring of our investment in Jeg’s Automotive, LLC.

Current wording

During the three months ended June 30, 2025, we recognized a realized net loss related to sale transactions with Credit Fund. During the three months ended March 31, 2025, we recognized a realized loss related to the restructuring of our investment in Aimbridge Acquisition Co., from debt to equity and the consolidation of our investment in Credit Fund II as a result of the Credit Fund II Purchase.

Previous wording

The net change in unrealized appreciation (depreciation) is driven by changes in various inputs used in our valuation methodology, including but not limited to enterprise value multiples, borrower leverage ratios, borrower ratings, and the impact of exits. The net change in unrealized appreciation (depreciation) is also driven by the reversal of prior period unrealized depreciation related to Credit Fund II and Aimbridge Acquisition Co., and an increase in value of our investment in Credit Fund.

Current wording

The net change in unrealized appreciation (depreciation) is driven by changes in various inputs used in our valuation methodology, including but not limited to enterprise value multiples, borrower leverage ratios, borrower ratings, and the impact of exits.

Previous wording

The following table sets forth information regarding our consolidated results of operations for the three month periods ending March 31, 2025 and December 31, 2024:

Current wording

The following table sets forth information regarding our consolidated results of operations for the three and six months ended June 30, 2025 and June 30, 2024:

Previous wording

The decrease in investment income for the three months ended March 31, 2025, as compared to the three months ended December 31, 2024, was primarily driven by a decrease in dividend income and lower yields on investments in the portfolio driven by the combination of lower base rates, lower new issue spreads, the repricing of existing loans and an increase in non-accruals, partially offset by a higher average outstanding investment balance. As of March 31, 2025, the size of our portfolio increased to $2,273,998 from $1,848,212 as of December 31, 2024, at amortized cost. As of March 31, 2025 and December 31, 2024, the weighted average yield of our total debt and income producing investments was 10.9% and 11.7%, respectively, based on amortized cost.

Current wording

The increase in investment income for the three and six months ended June 30, 2025, as compared to the three and six months ended June 30, 2024, was primarily driven by a higher average outstanding investment balance due to net origination activity in 2025, including assets acquired in the CSL III Merger and the Credit Fund II Purchase. As of June 30, 2025, the size of our portfolio increased to $2,366,445 from $1,783,219 as of June 30, 2024, at amortized cost. As of June 30, 2025 and June 30, 2024, the weighted average yield of our total debt and income producing investments was 10.9% and 12.7%, respectively, based on amortized cost.

Previous wording

Interest income and PIK income on our first and second lien debt investments are dependent on the composition and credit quality of the portfolio. Generally, we expect the portfolio to generate predictable quarterly interest income based on the terms stated in each loan’s credit agreement. As of March 31, 2025 and December 31, 2024, five and four of our income producing investments were on non-accrual status, respectively. Non-accrual investments had a fair value of $36,622 and

Current wording

Interest income and PIK income on our first and second lien debt investments are dependent on the composition and credit quality of the portfolio. Generally, we expect the portfolio to generate predictable quarterly interest income based on the terms stated in each loan’s credit agreement. As of June 30, 2025 and June 30, 2024, six and three of our debt and preferred equity investments were on non-accrual status, respectively. Non-accrual investments had a fair value of $48,069 and $30,209, which represented approximately 2.1% and 1.8% of total investments at fair value as of June 30, 2025 and June 30, 2024, respectively. The remaining income producing investments were performing and current on their interest payments as of June 30, 2025 and June 30, 2024.

Previous wording

The increase in interest expense and credit facility fees for the three months ended March 31, 2025 as compared to the three months ended March 31, 2024 was primarily driven by a higher average principal balance during the three months ended March 31, 2025, partially offset by lower benchmark rates.

Current wording

The increase in interest expense and credit facility fees for the three and six months ended June 30, 2025, as compared to the three and six months ended June 30, 2024, was primarily driven by a higher average principal balance during the three and six months ended June 30, 2025, resulting from liabilities assumed in connection with the CSL III Merger.

Previous wording

The increase in base management fees for the three months ended March 31, 2025 compared to the three months ended March 31, 2024 was driven by higher average gross assets as a result of the Credit Fund II Purchase and CSL III Merger for the three months ended March 31, 2025.

Current wording

The increase in base management fees for the three and six months ended June 30, 2025, compared to the three and six months ended June 30, 2024, was driven by a higher average gross assets as a result of the assets acquired in the CSL III Merger and the Credit Fund II Purchase for the three months ended June 30, 2025.

Previous wording

The change in incentive fees for the three months ended March 31, 2025 as compared to the three months ended March 31, 2024 is driven by lower pre-incentive fee net investment income.

Current wording

The change in incentive fees for the three and six months ended June 30, 2025, as compared to the three and six months ended June 30, 2024, is driven by changes in pre-incentive fee net investment income.