Annual Report for Fiscal Year Ending December 31, 2025 (Form 10-K)

Management's Discussion and Analysis of Financial Condition and the Results of Operations.

The information contained in this section should be read in conjunction with the consolidated financial statements and notes thereto appearing elsewhere in this Annual Report. This discussion contains forward-looking statements and involves substantial risks and uncertainties, and should be read in conjunction with the "Cautionary Statement Regarding Forward-Looking Statements" set

forth on page 4 of this Annual Report. Actual results could differ materially from those implied or expressed in any forward-looking statements. Except as otherwise indicated, the terms "we," "us," "our," and the "Company" refer to Onex Direct Lending BDC Fund.

Overview

We are a Delaware statutory trust structured as a non-diversified, closed-end management investment company that has elected to be treated as a BDC under the 1940 Act. In addition, for U.S. federal income tax purposes, we elected to be treated as a RIC under Subchapter M of the Code. To qualify as a RIC, we must, among other things, invest at least 70% of our total assets in "qualifying assets", meet certain source-of-income and asset diversification requirements, and timely distribute to our shareholders generally at least 90% of our investment company taxable income for each year. As of December 31, 2025 and 2024, the total amount of non-qualifying assets to total assets was approximately 5.5% and 9.1%, respectively.

Our investment objective is to generate current income while preserving capital, and to a lesser extent, capital appreciation by targeting investment opportunities with favorable risk-adjusted returns.

We invest primarily in high-quality senior secured first lien loans and other credit investments of "middle market companies" located in the United States. The Company defines "high-quality" as investments deemed by the Adviser, after diligence and underwriting, to have favorable risk-reward characteristics including, but not limited to, a low probability of default, favorable investment terms, and an appropriate capital structure to companies of high creditworthiness with stable cash flow generation. The Company may also seek to invest in the subordinated debt and equity, including warrants, options, convertible instruments, of middle market companies.

On August 25, 2021, we formed a wholly-owned blocker entity, Onex Direct Lending BDC Blocker LLC, which holds certain of our portfolio equity investments. On September 21, 2021, we formed a wholly-owned, special-purpose, bankruptcy-remote subsidiary, Onex Direct Lending BDC SPV, LLC, which holds certain of our portfolio loan investments that are used as collateral for our debt financing facility. On December 13, 2022, we formed a wholly-owned entity, Connect America OFDL BDC Holdings, LLC, which holds certain of our portfolio equity investments.

On October 1, 2021, we closed on our initial private offering and commenced operations. We conduct private offerings of our common shares to accredited investors and non-U.S. persons pursuant to a subscription agreement entered into with us.

We are externally managed by the Adviser, a subsidiary of Onex Corp, as investment adviser. The Adviser also serves as our administrator and provides administrative services necessary for us to operate.

Key Components of Our Results of Operations

Investments

Our level of investment activity can and does vary substantially from period to period depending on many factors, including the amount of debt and equity capital available to middle-market companies, the level of merger and acquisition activity for such companies, the general economic environment, the amount of capital we have available to us and the competitive environment for the type of investments we make.

Revenues

The principal measure of our financial performance is the net increase or decrease in net assets resulting from operations, which includes net investment income or loss and net realized and unrealized gain or loss on investments. Net investment income or loss is the difference between our income from interest, distributions, fees, and other investment income and our operating expenses, including interest expense. Net realized gain or loss on investments is the difference between the proceeds received from dispositions of portfolio investments and their amortized cost, including the respective realized gain or loss on foreign currency for any non-U.S. dollar denominated investment transactions. Net change in unrealized appreciation or depreciation on investments is the net change in the fair value of our investment portfolio, including the respective unrealized appreciation or depreciation on foreign currency for any non-U.S. dollar denominated investments.

We primarily generate revenue in the form of interest income from our investments in debt investments that consist primarily of senior and junior secured loans. Our debt investments are spread across multiple industries and geographic locations and, as such, we are broadly exposed to market conditions and business environments. As a result, although our investments are exposed to market risks, we continuously seek to limit concentration of exposure in any particular sector or issuer. Our debt investments typically have a term of five to 10 years, but the expected average life of such securities is generally between three and five years. The loans in which

we invest will generally bear interest at a floating rate usually determined on the basis of a benchmark, such as SOFR, or an alternate base rate. In addition, some of our investments may provide for PIK interest. Such amounts of accrued PIK interest are added to the cost of the investment on the respective capitalization dates and generally become due at maturity of the investment or upon the investment being called by the issuer. To a lesser extent, we may also generate revenues in the form of dividends and other distributions on the equity or other securities we anticipate holding. In addition, we may generate revenues in the form of non-recurring commitment, closing, origination, structuring or diligence fees, fees for providing managerial assistance, consulting fees, prepayment fees and performance-based fees. Any such fees generated in connection with our investments will be recognized when earned.

Expenses

Our primary operating expenses include the payment of management and incentive fees, if any, and other expenses under the Investment Advisory Agreement, interest expense from financing arrangements, and other expenses necessary for our operations. The management and incentive fees will compensate the Adviser for its work in identifying, evaluating, negotiating, executing, monitoring and servicing our investments.

We reimburse the Administrator for expenses necessary to perform services related to our administration and operations, including the Adviser's portion of the compensation and related expenses for certain personnel who provide administrative services. Such services include, among other things, clerical, bookkeeping and recordkeeping services, investor relations, performing or overseeing the performance of our corporate operations (which includes being responsible for the financial records that we are required to maintain and preparing reports for our shareholders and reports filed with the SEC), assisting us in calculating the NAV per share, overseeing the preparation and filing of tax returns and the printing and dissemination of reports to our shareholders, compliance monitoring and generally overseeing the payment of our expenses and the performance of administrative and professional services rendered to us by others.

We will also bear all other costs and expenses of our operations, administration and transactions, including but not limited to:

We are obligated to reimburse the Adviser for expense payments made by the Adviser to us in connection with the Expense Support Agreement following any calendar quarter in which we have available operating funds. The amount of the reimbursement payment for any calendar quarter will be equal to the lesser of (i) the excess operating funds in such calendar quarter, and (ii) the aggregate amount of all expense payments made by the Adviser to us within three years prior to the last business day of such calendar quarter that have not been previously reimbursed by us to the Adviser.

In addition, we and our Administrator have contracted with U.S. Bank N.A. to provide custodial and various accounting and administrative services, including but not limited to, preparing preliminary financial information for review by the Adviser, maintaining accounting and corporate books and records, processing trade information provided by us and performing testing in respect to RIC compliance.

We expect that our general and administrative expenses will increase in dollar terms during periods of asset growth, but will decline as a percentage of total assets during such periods.

Leverage

The amount of leverage we intend to use in any period depends on a number of factors, including cash on-hand available for investing, the cost of financing, general economic and market conditions. We are permitted to incur indebtedness as long as immediately after such incurrence we have an asset coverage ratio of at least 150%.

Portfolio and Investment Activity

As of December 31, 2025, we had investments in 57 portfolio companies with an aggregate fair value of $395.4 million. As of December 31, 2025 and 2024, the total amount of non-qualifying assets to total assets was approximately 5.5% and 9.1%, respectively.

Our investment activity for the years ended December 31, 2025 and 2024 was as follows:

The following table summarizes our top ten portfolio companies and industries based on fair value as of December 31, 2025:

The following table summarizes our top ten portfolio companies and industries based on fair value as of December 31, 2024:

The industry composition of our portfolio at fair value at December 31, 2025 and 2024 was as follows:

As of December 31, 2025 and 2024, our investments consisted of the following:

The following table shows the fair value of our performing and non-accrual investments as of December 31, 2025 and 2024:

Loans are generally placed on non-accrual status when there is reasonable doubt that principal or interest will be collected in full. The Company considers many factors relevant to an investment when placing it on or removing it from non-accrual status including, but not limited to, the delinquency status of the investment, economic and business conditions, the overall financial condition of the underlying investment, the value of the underlying collateral, bankruptcy status, if any, and any other facts or circumstances relevant to the investment. Accrued interest is generally reversed when a 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 of the outstanding principal and interest. Non-accrual loans may be restored to accrual status when past due principal and interest is paid current and are likely to remain current based on management's judgment.

Results of Operations

For information regarding results of operations for the year ended December 31, 2023, see our Form 10-K for the year ended December 31, 2024.

Our operating results for the years ended December 31, 2025 and 2024 were as follows:

Net income can vary substantially from period-to-period due to various factors, including the level of new investment commitments, the recognition of realized gains and losses and unrealized appreciation and depreciation. As a result, comparisons of net increase in net assets resulting from operations may not be meaningful.

Investment Income

Investment income is primarily dependent on the composition and credit quality of our investment portfolio. Generally, we expect our debt investments to generate predictable, recurring interest income in accordance with the contractual terms of each loan. We expect that investment income will vary based on a number of factors including the pace of our capital deployment and repayments. Corporate equity securities may pay a dividend and may increase in value for which a gain may be recognized; generally, such dividend payments and gains are less predictable than interest income on our loan portfolio.

Investment income for the years ended December 31, 2025 and 2024 were as follows:

For the years ended December 31, 2025 and 2024, we have generated interest income, including PIK, of $48.6 million and $60.2 million, respectively. Such revenues represent cash interest earned as well as non-cash income consisting of accretion of original issue discounts and PIK. Cash flows related to such non-cash revenues may not occur for a number of reporting periods or years after such revenues are recognized. The level of interest income we receive is generally related to the principal balance of income-producing investments, multiplied by the contractual interest rates of our investments. Interest income decreased primarily as a result of the decrease in the size of our portfolio and decrease in the weighted average yield of our portfolio. The average position size of our portfolio and weighted average yield of our portfolio at par for the years ended December 31, 2025 and 2024 were as follows:

Fee income, included in other income, is transaction based, and typically consists of amendment and consent fees, prepayment fees, structuring fees and other non-recurring fees. As such, fee income is generally dependent on new direct origination investments and the occurrence of events at existing portfolio companies resulting in such fees. Any such fees generated will be recognized as earned. We expect the dollar amount of interest and any dividend income that we earn to increase as the size of our investment portfolio increases.

Expenses

Expenses for the years ended December 31, 2025 and 2024 were as follows:

Total expenses, including reimbursement of expense support to the Adviser were $23.4 million and $30.4 million for the years ended December 31, 2025 and 2024, respectively. We pay our Adviser a management fee quarterly in arrears at an annual rate of 1.25% of our net assets as of the end of the most recently completed calendar quarter; provided that the management fee shall not be greater than 1.25% of our total assets (excluding cash and cash equivalents) at the end of the most recently completed calendar quarter. We also pay our Adviser an incentive fee that consists of two components that are independent of each other, with the result that one component may be payable even if the other is not. The income component of the incentive fee will be the amount, if positive, equal to 15.0%, with respect to each Legacy Fee Quarter, and 12.5%, with respect to each Current Fee Quarter, of the aggregate net investment income before incentive compensation earned for the most recent calendar quarter and the preceding eleven calendar quarters (or if shorter, the number of calendar quarters that have occurred since commencement of operations), less aggregate income incentive compensation previously paid and/or waived with respect to the first eleven calendar quarters (or the portion thereof)

included in the relevant trailing twelve quarters. The income component of the incentive fee is subject to a 7.0% hurdle on our net assets at the beginning of each applicable calendar quarter and subject to a cap of 15.0% during the relevant Legacy Fee Quarters and 12.5% during the relevant Current Fee Quarters of the cumulative net return comprising the relevant trailing twelve quarters. The capital gains component of the incentive fee will be the amount, if positive, equal to 15.0%, prior to October 1, 2023, and 12.5%, beginning October 1, 2023, of the aggregate realized capital gains (computed net of realized capital losses and unrealized capital depreciation, if any) for the most recent calendar quarter and the preceding eleven calendar quarters (or if shorter, the number of calendar quarters that have occurred since commencement of the fund), less capital gains incentive compensation previously paid in respect of the first eleven calendar quarters (or the portion thereof) included in the relevant trailing twelve quarters. We reimburse our Administrator for the allocable portion of the Adviser's overhead and other expenses incurred by the Adviser and requested to be reimbursed by the Adviser in performing its obligations under the Administration Agreement, including rent and the allocable portion of the cost of our Chief Compliance Officer and Chief Financial Officer and their respective staffs.

Interest expense under the SPV Facility and SMBC Facility is based on the average debt outstanding. Interest expense increased primarily due to the increase in average principal amount of debt outstanding and weighted average interest rate as a result of the increase in SOFR.

For the year ended December 31, 2024, we reimbursed the Adviser for expense support received in connection with the Expense Support Agreement of $0.5 million, and the Adviser has agreed to permanently waive the remaining balance outstanding of $0.9 million.

We expect our operating expenses related to our ongoing operations to increase in the next several quarters because of the anticipated growth in the size of our asset base. We expect operating expenses as a percentage of our total assets to decrease during periods of asset growth.

Net Realized Gains or Losses

Our investments are generally purchased at a discount to par. We received principal repayments of $306.9 million and $218.2 million during the years ended December 31, 2025 and 2024, from which we realized net gains (losses) totaling $0.6 million and $(6.7) million, respectively. We recognized gains or losses on partial principal repayments we received at par value.

The net realized gains (losses) from the sales, repayments or exits of investments for the years ended December 31, 2025 and 2024 consisted of the following:

The net realized gain on investments for the year ended December 31, 2025 consisted of the following:

The net realized loss on investments for the year ended December 31, 2024 consisted of the following:

Net Change in Unrealized Appreciation or Depreciation

We value our portfolio investments quarterly and the changes in value are recorded as the change in unrealized appreciation or depreciation in our consolidated statements of operations. Net change in unrealized appreciation or depreciation on investments for the years ended December 31, 2025 and 2024 consisted of the following:

For the year ended December 31, 2025, the net change in unrealized depreciation on investments totaled $30.1 million. The fair value of our debt investments as a percentage of principal decreased from 95.9% as of December 31, 2024 to 89.8% as of December 31, 2025, driven by changes in portfolio company fundamentals and performance of the syndicated loan market.

For the year ended December 31, 2024, the net change in unrealized depreciation on investments totaled $4.5 million. The fair value of our debt investments decreased driven by changes in portfolio company fundamentals and performance of the syndicated loan market.

The net change in unrealized appreciation (depreciation) on investments amounts include the impact of transferring unrealized appreciation (depreciation) to net realized gains (losses) due to sale and paydown activity.

The changes in net unrealized appreciation and depreciation on investments for the years ended December 31, 2025 and 2024 consisted of the following:

During the years ended December 31, 2025 and 2024, we recognized net unrealized gains (losses) on foreign currency of $0.1 million and $(0.1) million, respectively.

Net increase (decrease) in Net Assets Resulting from Operations

For the year ended December 31, 2025, the net increase (decrease) in net assets resulting from operations was $(3.9) million or $(0.38) per share. For the year ended December 31, 2024, the net increase (decrease) in net assets resulting from operations was $19.7 million or $1.83 per share, respectively.

Financial Condition, Liquidity and Capital Resources

Our liquidity and capital resources are generated from the net proceeds received from the issuance of our common shares from private placement offerings, as well as from proceeds from principal repayments, income earned on investments and cash equivalents, and borrowings from the credit facilities. We intend to continue to generate cash primarily from future offerings of shares of our common shares, future borrowings and cash flows from operations. We may from time to time enter into additional debt facilities or increase the size of existing facilities to borrow funds to make investments, including before we have fully invested the net proceeds from our private placement offering, to the extent we determine that additional capital would allow us to take advantage of additional investment opportunities, if the market for debt financing presents attractively priced debt financing opportunities, or if our Board determines that leveraging our portfolio would be in our best interests and the best interests of our shareholders. In accordance with the 1940 Act, with certain limited exceptions, we are allowed to incur borrowings, issue debt securities or issue preferred shares if immediately after the borrowing or issuance our ratio of total assets (less total liabilities other than indebtedness) to total indebtedness plus preferred shares, is at least 150%. As of December 31, 2025, our asset coverage ratio was 188.6%. We seek to carefully consider our unfunded commitments for the purpose of planning our capital resources and ongoing liquidity including our financial leverage. Further, we maintain sufficient borrowing capacity within the 150% asset coverage limitation under the 1940 Act and the asset coverage limitation under our credit facility to cover any outstanding unfunded commitments we are required to fund.

The primary uses of cash, including the net proceeds from our issuance and sale of our common shares, are for investments in portfolio companies, repayment of indebtedness, if any, cash distributions to our shareholders, and the cost of operations.

As of December 31, 2025, we had $9.8 million in cash and cash equivalents on hand, plus $81.0 million and $80.0 million available to us under our borrowing facilities with SMBC and Onex Credit Finance II Corporation, a subsidiary of the ultimate parent entity of the Adviser, respectively, which is expected to be sufficient for our investing activities and to conduct our operations in the short term and for the foreseeable future. However, as the impact of ongoing inflationary pressure on the economy and our business evolves, we will continue to assess our liquidity needs. A continued worldwide disruption due to inflationary pressures could materially affect our future access to our sources of liquidity, particularly our cash flows from operations, financial condition, capitalization, and capital investments. In the event of a sustained market deterioration, we may need additional liquidity, which would require us to evaluate available alternatives and take appropriate actions.

Equity

We are authorized to issue an unlimited number of common shares at $0.001 par value per share.

The following table summarizes the total shares issued and proceeds received related to the placement of our common shares for the year ended December 31, 2025:

The following table summarizes the total shares issued and proceeds received related to the placement of our common shares for the year ended December 31, 2024:

In the first quarter of 2023, we began offering, and on a quarterly basis, intend to continue offering, to repurchase common shares on such terms as may be determined by the Board in its discretion. The Board has complete discretion to determine whether we will engage in any share repurchase, and if so, the terms of such repurchase. At the discretion of the Board, we may use cash on hand, cash available from borrowings, and cash from the sale of investments as of the end of the applicable period to repurchase shares.

All shares purchased by us pursuant to the terms of each offer to repurchase will be retired and thereafter will be authorized and unissued shares.

Any periodic repurchase offers are subject in part to our available cash and compliance with the BDC and RIC qualification and diversification rules promulgated under the 1940 Act and the Code, respectively. While we intend to continue to conduct quarterly tender offers as described above, we are not required to do so and may suspend or terminate the share repurchase program at any time.

The following table presents the share repurchases completed during the year ended December 31, 2025:

The following table presents the share repurchases completed during the year ended December 31, 2024:

Distributions and Dividend Reinvestment

We intend to continue to make quarterly distributions to our shareholders. To maintain our RIC status and avoid certain excise taxes imposed on RICs, we generally endeavor to distribute during each calendar year an amount at least equal to the sum of:

We may choose to carry forward taxable income in excess of current year distributions into the next tax year and pay a 4% excise tax on such income, to the extent required.

The amount of our declared distributions, as evaluated by management and approved by our Board, is based primarily on our evaluation of our net investment income and distributable taxable income.

The following table reflects the distributions declared on common shares and common shares issued pursuant to our DRP for the year ended December 31, 2025:

The following table reflects the distributions declared on common shares and common shares issued pursuant to our DRP for the year ended December 31, 2024:

Borrowings

We use borrowed funds, known as "leverage," to make investments and to attempt to increase returns to our shareholders by reducing our overall cost of capital. As a BDC, we are limited in the amount of leverage we can incur under the 1940 Act. We are only allowed to borrow amounts such that our asset coverage, as defined in the 1940 Act, equals at least 150% after such borrowing. As of December 31, 2025 and 2024, our asset coverage ratio was 188.6% and 205.4%, respectively.

We expect to maintain adequate liquidity and compliance with regulatory and contractual asset coverage requirements.

Contractual Obligations

The following table shows the contractual maturities of our outstanding debt obligations as of December 31, 2025:

The following table shows the contractual maturities of our outstanding debt obligations as of December 31, 2024:

The weighted average interest rate on aggregate principal amount outstanding was 6.4% and 7.2% as of December 31, 2025 and 2024, respectively.

The ratio of total principal amount of debt outstanding to net assets as of December 31, 2025 was 1.13:1.00 compared to 0.95:1.00 as of December 31, 2024.

SPV Facility

We and our consolidated subsidiary, ODL SPV, were party to the "SPV Facility" with Société Générale, as initial lender and agent, and certain financial institutions that allowed ODL SPV to borrow up to $340.0 million. Borrowings under the SPV Facility bore interest at SOFR plus a spread of 1.75% or 2.40% based on certain conditions (or an alternative rate of interest for certain loans denominated in Canadian Dollars, Euros or Sterling). ODL SPV was obligated to pay an unused commitment fee on the unused commitment amount at rate of (1) 1.00% if the amount drawn under the SPV Facility is less than the minimum commitment usage (the "Minimum Commitment Usage") and (2) 0.40% if the amount drawn under the SPV Facility is greater than or equal to the Minimum Commitment Usage. The Minimum Commitment Usage is equal to (1) 0.0% for the first six months ended April 4, 2022; (2) 37.5% for the period from April 5, 2022 through June 27, 2022; (3) 75% for the period from June 28, 2022 through July 13, 2022; (4) $150.0 million for the period from July 14, 2022 through January 13, 2023; and (5) $255.0 million thereafter. The Company was also obligated to pay a fee of 0.20% per annum on the outstanding balance under the SPV Facility beginning on July 14, 2022. The SPV Facility was secured by a lien on assets held by the ODL SPV and on any payments received by ODL SPV in respect of those assets. The SPV Facility was scheduled to terminate on October 2, 2026, but on October 3, 2024, the ODL SPV terminated and repaid in full the SPV Facility.

SMBC Facility

On October 3, 2024, ODL SPV and us, solely in our capacity as the transferor and as the servicer, entered into the SMBC Facility with SMBC, as initial lender and as the administrative agent and as the collateral agent, and U.S. Bank National Association as account bank and as the collateral custodian. The current maximum principal amount of the SMBC Facility is $300.0 million (which consists of $300.0 million of revolving commitments), which may be increased up to a maximum facility amount of $1.5 billion subject to the requirements set forth in the SMBC Facility, including lender consent. The availability of this amount is subject to an overcollateralization ratio test, which is based on the value of ODL SPV's assets from time to time, and satisfaction of certain conditions, including an interest coverage ratio test, certain concentration limits and collateral quality tests. The SMBC Facility provides for the ability to draw and redraw revolving loans under the SMBC Facility through October 3, 2027, unless the revolving commitments are terminated sooner in the SMBC Facility. The reinvestment period end date (after which no borrowings may be drawn under the SMBC Facility) and the maturity date under the SMBC Facility are October 3, 2027 and October 3, 2029, respectively, unless otherwise terminated in accordance with its terms. Subject to certain conditions set forth in the SMBC Facility, advances (i) during the reinvestment period will bear interest at SOFR plus a spread of 1.65% or 2.30% per annum with respect to SOFR advances and will bear interest at the base rate plus a spread of 0.65% or 1.30% per annum with respect to base rate advances and (ii) after the reinvestment period will bear interest at SOFR plus a spread of 2.15% or 2.80% per annum with respect to SOFR advances and will bear interest at the base rate plus a spread of 1.15% or 1.80% per annum with respect to base rate advances. The SMBC Facility includes customary covenants, including certain financial maintenance covenants, limitation on the activities of ODL SPV, including limitations on incurrence of incremental indebtedness, and customary events of default. The SMBC Facility is secured by a lien on assets held by the ODL SPV and on any payments received by ODL SPV in respect of those assets.

Revolving Loan Agreement

On September 8, 2022, we entered into the Revolving Onex Loan with the Onex Entity, whereby the Onex Entity could advance an Onex Loan to us with a maximum aggregate outstanding principal amount of $80.0 million and a maturity date with respect to each Onex Loan of the day falling two years after the funding of such Onex Loan. On May 5, 2023, we terminated the Revolving Onex Loan and entered into the Revolving OCF II Loan, whereby OCF II may advance an Onex Loan II to us with a maximum aggregate outstanding principal amount of $80.0 million and a maturity date with respect to each OCF II Loan of the day falling two years after the funding of such OCF II Loan. We are required to meet certain criteria, including a leverage ratio threshold, before OCF II is obligated to make a loan to us. The Revolving OCF II Loan is intended to provide us with the ability to fund investments, pay related costs and expenses, and for general corporate purposes. Amounts drawn under an OCF II Loan will bear interest at SOFR plus a

spread of 2.60%. On April 17, 2025, the Company approved and ratified the Company's entry into an A&R Revolving OCF II Loan between the Company and OCF II. Under the A&R Revolving OCF II Loan, the applicable margin was decreased from 2.60% per annum to 1.65% per annum.

On January 29, 2026, the Company terminated the Revolving OCF II Loan and entered into an unsecured revolving loan agreement with Onex US Holdings LLC ("OUSH") (the "Revolving OUSH Loan"), a subsidiary of the ultimate parent entity of the Adviser, whereby OUSH may advance amounts to the Company (each such amount, an "OUSH Loan") with a maximum outstanding of such OUSH Loan of $20.0 million and a maturity date with respect to each OUSH Loan of the day falling two years after the funding of such OUSH Loan. The Company is required to meet certain criteria, including a leverage ratio threshold, before OUSH is obligated to make a loan to the Company. The Revolving OUSH Loan is intended to provide the Company with the ability to fund investments, pay related costs and expenses, and general corporate purposes. Amounts drawn under an OUSH Loan will bear interest at SOFR plus a spread of 1.65%.

Related Party Transactions

We have entered into certain contracts with affiliated or related parties. In particular, we entered into (1) an Investment Advisory Agreement with the Adviser to provide us with investment advisory services under which we pay our Adviser an annual base management fee based on our total assets, excluding cash and cash equivalents, and incentive fees based on our performance and (2) an administrative agreement with the Administrator to perform (or oversee, or arrange for, the performance of) the administrative services necessary to enable us to operate and under which we reimburse the Administrator for administrative expenses incurred on our behalf. See "Note 3. Related Party Transactions - Administration Agreement" and "- Investment Advisory Agreement" for a description of our obligations under these agreements. We also entered into an Expense Support Agreement with the Adviser, whereby the Adviser may elect to pay certain of our expenses from time to time, which we will be obligated to reimburse to the Adviser if certain conditions are met. We are obligated to reimburse the Adviser for expense payments made by the Adviser to us in connection with the Expense Support Agreement following any calendar quarter in which we have available operating funds. The amount of the reimbursement payment for any calendar quarter will be equal to the lesser of (i) the excess operating funds in such calendar quarter, and (ii) the aggregate amount of all expense payments made by the Adviser to us within three years prior to the last business day of such calendar quarter that have not been previously reimbursed by us to the Adviser. See "Note 3. Related Party Transactions - Expense Support Agreement" for a description of our obligations under this agreement. We also entered into the Revolving Onex Loan with the Onex Entity, whereby the Onex Entity could advance amounts to us with a maximum aggregate outstanding principal amount of $80.0 million and a maturity date with respect to each Onex Loan of the day falling two years after the funding of such Onex Loan. On May 5, 2023, we terminated the Revolving Onex Loan and entered into the Revolving OCF II Loan, whereby OCF II may advance an Onex Loan II to us with a maximum aggregate outstanding principal amount of $80.0 million and a maturity date with respect to each OCF II Loan of the day falling two years after the funding of such OCF II Loan. We are required to meet certain criteria, including a leverage ratio threshold, before OCF II is obligated to make a loan to us. The Revolving OCF II Loan is intended to provide us with the ability to fund investments, pay related costs and expenses, and for general corporate purposes. Amounts drawn under the OCF II Loan will bear interest at SOFR plus a spread of 2.60%. On April 17, 2025, the Company approved and ratified the Company's entry into an A&R Revolving OCF II Loan between the Company and OCF II. Under the A&R Revolving OCF II Loan, the applicable margin was decreased from 2.60% per annum to 1.65% per annum.

On January 29, 2026, the Company terminated the Revolving OCF II Loan and entered into an unsecured revolving loan agreement with Onex US Holdings LLC ("OUSH") (the "Revolving OUSH Loan"), a subsidiary of the ultimate parent entity of the Adviser, whereby OUSH may advance amounts to the Company (each such amount, an "OUSH Loan") with a maximum outstanding of such OUSH Loan of $20.0 million and a maturity date with respect to each OUSH Loan of the day falling two years after the funding of such OUSH Loan. The Company is required to meet certain criteria, including a leverage ratio threshold, before OUSH is obligated to make a loan to the Company. The Revolving OUSH Loan is intended to provide the Company with the ability to fund investments, pay related costs and expenses, and general corporate purposes. Amounts drawn under an OUSH Loan will bear interest at SOFR plus a spread of 1.65%.

Off-Balance Sheet Arrangements

From time-to-time we are a party to financial instruments with off-balance sheet risk in the normal course of business in order to meet the needs of our investment in portfolio companies. Such instruments include commitments to extend credit and may involve, in varying degrees, elements of credit risk in excess of amounts recognized on our balance sheet. Prior to extending such credit, we attempt to limit our credit risk by conducting extensive due diligence, obtaining collateral where necessary and negotiating appropriate financial covenants.

As of December 31, 2025 and 2024, we had the following outstanding commitments to fund investments in current portfolio companies:

Recent Developments

On January 29, 2026, the Company terminated the Revolving OCF II Loan and entered into an unsecured revolving loan agreement with Onex US Holdings LLC ("OUSH") (the "Revolving OUSH Loan"), a subsidiary of the ultimate parent entity of the Adviser, whereby OUSH may advance amounts to the Company (each such amount, an "OUSH Loan") with a maximum outstanding of such OUSH Loan of $20.0 million and a maturity date with respect to each OUSH Loan of the day falling two years after the funding of such OUSH Loan. The Company is required to meet certain criteria, including a leverage ratio threshold, before OUSH is obligated to make a loan to the Company. The Revolving OUSH Loan is intended to provide the Company with the ability to fund investments, pay related costs and expenses, and general corporate purposes. Amounts drawn under an OUSH Loan will bear interest at SOFR plus a spread of 1.65%.

On February 6, 2026, we repurchased common shares in connection with our tender offer as follows:

On March 4, 2026, the Board declared a quarterly dividend of $0.54 per share for the Company's shareholders of record as of March 5, 2026, payable on March 19, 2026.

Critical Accounting Estimates

The preparation of our consolidated financial statements in conformity with U.S. generally accepted accounting principles requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities. Changes in the economic environment, financial markets, and any other parameters used in determining such estimates could cause actual results to differ. Critical accounting policies are those that are both important to the presentation of our financial condition and results of operations and require management's most difficult, complex, or subjective judgments, often because of the need to make estimates about the effect of matters that are inherently uncertain and that may change in subsequent periods. Our critical accounting policies are those applicable to the basis of presentation, valuation of investments, and certain revenue recognition matters as discussed below. See Note 2 to our consolidated financial statements, "Significant Accounting Policies-Investments", contained elsewhere herein.

Valuation of Portfolio Investments

The most significant estimate inherent in the preparation of our consolidated financial statements is the valuation of investments and the related amounts of unrealized appreciation and depreciation of investments recorded.

Value, as defined in Section 2(a)(41) of the 1940 Act, is (1) the market price for those securities for which a market quotation is readily available and (2) for all other securities and assets, fair value as determined in good faith by our Adviser, as "valuation designee," pursuant to procedures approved by our Board. The Board has designated the Adviser as its "valuation designee" pursuant to Rule 2a-5 under the 1940 Act, and in that role the Adviser is responsible for performing fair value determinations relating to all of our investments, including periodically assessing and managing any material valuation risks and establishing and applying fair value methodologies, in accordance with valuation policies and procedures that have been approved by the Board. Although the Board designated our Adviser as "valuation designee," the Board ultimately is responsible for fair value determinations under the 1940 Act.

Our valuation policy is intended to provide a consistent basis for determining the fair value of the portfolio based on the nature of the security, the market for the security and other considerations including the financial performance and enterprise value of the

portfolio company. Because of the inherent uncertainty of valuation, the Adviser determined values may differ significantly from the values that would have been used had a ready market existed for the investments, and the differences could be material.

Pursuant to ASC 946: Financial Services-Investment Companies ("ASC 946"), we reflect our investments on our balance sheet at their determined fair value with unrealized gains and losses resulting from changes in fair value reflected as a component of unrealized gains or losses on our statements of operations. Fair value is the amount that would be received to sell the investments in an orderly transaction between market participants at the measurement date (i.e., the exit price).

See Note 2 to the consolidated financial statements for the additional information about the level of market observability associated with investments carried at fair value.

We follow the provisions of ASC 820, which among other matters, requires enhanced disclosures about investments that are measured and reported at fair value. This standard defines fair value and establishes a hierarchal disclosure framework which prioritizes and ranks the level of market price observability used in measuring investments at fair value and expands disclosures about assets and liabilities measured at fair value. 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. This fair value definition focuses on an exit price in the principle, or most advantageous market, and prioritizes, within a measurement of fair value, the use of market-based inputs (which may be weighted or adjusted for relevance, reliability and specific attributes relative to the subject investment) over entity-specific inputs. Market price observability is affected by a number of factors, including the type of investment and the characteristics specific to the investment. Investments with readily available active quoted prices or for which fair value can be measured from actively quoted prices generally will have a higher degree of market price observability and a lesser degree of judgment used in measuring fair value. Subsequent to the adoption of ASC 820, the FASB has issued various staff positions clarifying the initial standard (see Note 2 to the consolidated financial statements: "Significant Accounting Policies-Investments").

The Company classifies the inputs used to measure these fair values into the following hierarchy as defined by current accounting guidance:

Investments for which market quotes are readily available are typically valued at the average bid and ask prices of such market quotes, which are generally obtained from independent pricing services, broker-dealers or market makers. To validate market quotes, we will utilize a number of factors to determine if the quotes are representative of fair value, including the source and number of the quotes. Debt and equity securities for which market quotes are not readily available or are deemed not to represent fair value, are valued at fair value as determined in good faith by the Adviser, in accordance with a valuation policy approved by the Board and a consistently applied valuation process, which includes input from management and independent valuation firms that have been engaged to assist in the valuation of portfolio investments without readily available market quotes. Accordingly, such investments go through our multi-step valuation process as described below. Investments purchased within the quarter before the valuation date and debt investments with remaining maturities of 60 days or less may each be valued at cost with interest accrued or discount accreted/premium amortized to the date of maturity (although they are typically valued at available market quotes), unless such valuation, in the judgment of the Adviser, does not represent fair value.

The Adviser undertakes a multi-step valuation process, which includes, among other procedures, the following:

As part of the valuation process, the Adviser may consider other information and may use valuation methods including but not limited to (i) market quotes for similar investments, (ii) recent trading activity, (iii) discounting forecasted cash flows of the investment, (iv) models that consider the implied yields from comparable debt, (v) third party appraisals, (vi) sale negotiations and purchase offers received from independent parties and (vii) estimated value of underlying assets to be received in any liquidation or restructuring.

As part of the valuation process, the Adviser will primarily use the "income approach" by using a present value technique that discounts the estimated contractual cash flows. Discount rates applied to estimated contractual cash flows for an underlying asset vary by specific investment, industry, priority and nature of the debt security and are assessed relative to leveraged loan and high-yield bond indices at the valuation date. The use of market indices as part of the valuation methodology is subject to adjustment for many factors, including priority, collateral used as security, structure, performance and other quantitative and qualitative attributes of the asset being valued. When an external event such as a purchase transaction, public offering or subsequent equity or debt sale occurs, the Board or its delegates will consider whether the pricing indicated by the external event corroborates its valuation.

When the Company determines its NAV as of the last day of a month that is not also the last day of a calendar quarter, the Company intends to update the value of securities with reliable market quotes to the most recent market quotation. For securities without reliable market quotes, the Adviser's valuation team will generally value such assets at the most recent quarterly valuation unless the Adviser determines that a significant observable change has occurred since the most recent quarter end with respect to the investment (which determination may be as a result of a material event at a portfolio company, material change in market spreads, secondary market transaction in the securities of an investment or otherwise). If the Adviser's valuation team determines such a change has occurred with respect to one or more investments, the Adviser's valuation team will determine whether to update the value for each relevant investment, using positive assurance from an independent valuation firm where applicable in accordance with our valuation policy, pursuant to authority delegated by the Board.

A determination of fair value involves subjective judgments and estimates and depends on the facts and circumstances present at each valuation date. Due to the inherent uncertainty of determining the fair value of investments that do not have a readily available market value, the fair value of the Company's investments may fluctuate from period to period. Additionally, the fair value of such investments may differ significantly from the values that would have been used had a ready market existed for such investments and may differ materially from the values that may ultimately be realized. Further, such investments are generally less liquid than publicly traded securities and may be subject to contractual and other restrictions on resale. If the Company were required to liquidate a portfolio investment in a forced or liquidation sale, it could realize amounts that are different from the amounts presented and such differences could be material.

In addition, changes in the market environment, including the impact of changes in broader market indices and credit spreads, and other events that may occur over the life of the investments may cause the gains or losses ultimately realized on these investments to be different than the unrealized gains or losses reflected herein.

Revenue Recognition

We record interest income on an accrual basis to the extent that we expect to collect such amounts. For loans and debt securities with contractual PIK interest, which represents contractual interest accrued and added to the loan balance that generally becomes due at maturity, we will not accrue PIK interest if management determines that the PIK interest is not collectible. We do not accrue as a receivable interest on loans and debt securities if we have reason to doubt our ability to collect such interest. Loan origination fees, original issue discount, and market discount are capitalized and then we amortize such amounts as interest income. Upon the prepayment of a loan or debt security, any unamortized loan origination fees are recorded as interest income. We further record prepayment premiums on loans and debt securities as interest income when we receive such amounts.

Income Taxes

We elected to be treated for U.S. federal income tax purposes, and to qualify annually, as a RIC under the Code. To qualify for and maintain qualification as a RIC, we must, among other things, meet certain source-of-income and asset diversification requirements, and make certain minimum distributions to shareholders. We will be subject to a 4% nondeductible U.S. federal excise tax on undistributed income. See "Note 2. Significant Accounting Policies - Income Taxes".