Annual Report for Fiscal Year Ending December 31, 2024 (Form 10-K)

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and other parts of this report contain forward-looking information that involves risks and uncertainties. References to "we," "us," "our," and the "Company," mean Phillip Street Middle Market Lending Fund LLC or Phillip Street Middle Market Lending Fund LLC, together with its consolidated subsidiaries, as the context may require. The terms "GSAM," "Goldman Sachs Asset Management," our "Adviser" or our "Investment Adviser" refer to Goldman Sachs Asset Management, L.P., a Delaware limited partnership. The term "GS Group Inc." refers to The Goldman Sachs Group, Inc. "GS & Co." refers to Goldman Sachs & Co. LLC and its predecessors. The term "Goldman Sachs" refers to GS Group Inc., together with GS & Co., GSAM and its other subsidiaries and affiliates. The discussion and analysis contained in this section refer to our financial condition, results of operations and cash flows. The information contained in this section should be read in conjunction with the consolidated financial statements and notes thereto appearing elsewhere in this report. Please see "Cautionary Statement Regarding Forward-Looking Statements" for a discussion of the uncertainties, risks and assumptions associated with this discussion and analysis. Our actual results could differ materially from those anticipated by such forward-looking information due to factors discussed under "Cautionary Statement Regarding Forward-Looking Statements" appearing elsewhere in this report.

OVERVIEW

We are a specialty finance company focused on lending to middle-market companies. We are a closed-end management investment company that has elected to be regulated as a business development company ("BDC") under the Investment Company Act of 1940, as amended (the "Investment Company Act"). In addition, we have elected to be treated as a regulated investment company ("RIC"), and we expect to qualify annually for tax treatment, as a RIC under Subchapter M of the Internal Revenue Code of 1986, as amended (the "Code"), commencing with our taxable year ended December 31, 2022. From our formation in 2022 through December 31, 2024, we originated approximately $860.7 million in aggregate principal amount of debt investments prior to any subsequent exits and repayments. We seek to generate current income and, to a lesser extent, capital appreciation primarily through direct originations of secured debt, including first lien, unitranche debt, including last-out portions of such loans, and second lien debt, and unsecured debt, including mezzanine debt, as well as through select equity investments.

"Unitranche" loans are first lien loans that extend deeper in a borrower's capital structure than traditional first lien debt and may provide for a waterfall of cash flow priority between different lenders in such loan. In a number of instances, we may find another lender to provide the "first-out" portion of a unitranche loan while we retain the "last-out" portion of such loan, in which case, the "first-out" portion of the loan would generally receive priority with respect to the payment of principal, interest and any other amounts due thereunder as compared to the "last-out" portion that we would continue to hold. In exchange for taking greater risk of loss, the "last-out" portion generally earns a higher interest rate than the "first-out" portion of the loan. We use the term "mezzanine" to refer to debt that ranks senior in right of payment only to a borrower's equity securities and ranks junior in right of payment to all of such borrower's other indebtedness. We may make multiple investments in the same portfolio company.

We may also originate or invest in "covenant-lite" loans, which are loans with fewer financial maintenance covenants than other obligations, or no financial maintenance covenants. Such covenant-lite loans may not include terms that allow the lender to monitor the performance of the borrower or to declare a default if certain criteria are breached. These flexible covenants (or the absence of covenants) could permit borrowers to experience a significant downturn in their results of operations without triggering any default that would permit holders of their debt (such as us) to accelerate indebtedness or negotiate terms and pricing. Accordingly, to the extent we invest in "covenant-lite" loans, we may have fewer rights against a borrower and may have a greater risk of loss on such investments as compared to investments in or exposure to loans with financial maintenance covenants. Therefore, our investments may result in an above-average amount of risk and volatility or loss of principal. We also may invest in other assets, including cash equivalents, U.S. government securities and other short-term investments, as described above. These investments entail additional risks that could adversely affect our investment returns.

We expect to invest, under normal circumstances, at least 90% of our net assets (plus any borrowings for investment purposes) in private middle-market credit obligations and related instruments. We define "credit obligations and related instruments" for this purpose as any fixed-income instrument, including loans to, and bonds, preferred stock of and other instruments, portfolio companies that provide exposure to fixed-income instruments. These other instruments may not by definition be fixed-income instruments, but structurally have the underlying investment risk and return profile and income-payment profile of fixed-income instruments. "Middle market" is used to refer to companies with between $5 million and $200 million of annual EBITDA, adjusted for certain one-time and non-recurring expenses that are outside the ordinary operations of these companies, along with companies that we determine, based on other metrics, including recurring revenue or tower cash flow, are middle market companies. Following such time that the aggregate amount of capital contributions to us made by Unitholders equals or exceeds $450 million, but subject to market conditions and the availability of suitable investment opportunities, we generally expect to target allocations among private middle-market credit obligations and related instruments in the following ratios: (i) 45% to companies with between $5 million and $25 million of EBITDA, and (ii) 55% to companies with between $25 million and $75 million of EBITDA, in each case adjusted for certain one-time and non-recurring expenses that are outside the ordinary operations of these companies. Notwithstanding the foregoing, we may invest on an opportunistic basis in credit obligations of private middle-market companies with EBITDA outside of the foregoing ranges, including credit obligations of companies that we believe are middle market companies based on metrics such as recurring revenue and tower cash flow, as opposed to EBITDA. In addition, as a result of fluctuations in the asset value of one asset relative to another asset, private middle-market credit obligations and related instruments may not reflect the foregoing targets or may represent less than 90% of our net assets (plus any borrowings for investment purposes) at any time. However, we may not invest, under normal circumstances, more than 20% of our net assets (plus any borrowings for investment purposes) in securities and other instruments that are not private middle-market credit obligations. In addition, we are subject to the investment guidelines, which are further described in "Item 1. Business-Investment Criteria."

We expect to invest in middle-market companies domiciled in the United States. We may from time to time invest opportunistically in large U.S. companies, stressed or distressed debt, structured products, private equity or other opportunities, subject to the investment guidelines and the limits imposed by the Investment Company Act.

While we expect our investment program to focus primarily on debt investments, our investments may include equity or equity features, such as a direct investment in the equity or convertible securities of a portfolio company or warrants or options to buy a minority interest in a portfolio company. Any warrants we may receive with debt securities will generally require only a nominal cost to exercise, so as a portfolio company appreciates in value, we may achieve additional investment return from these equity investments. We may structure the warrants to provide provisions protecting our rights as a minority-interest holder, as well as puts, or rights to sell such securities back to the portfolio company, upon the occurrence of specified events. In many cases, we may also obtain registration rights in connection with these equity investments, which may include demand and "piggyback" registration rights (which would allow us to have equity securities from an investment in a portfolio company registered for public offering in connection with a planned registration of such equity securities by the portfolio company).

For a discussion of the competitive landscape we face, please see "Item 1A. Risk Factors-Risks Relating to Competition-We operate in a highly competitive market for investment opportunities" and "Item 1. Business-Competitive Advantages."

KEY COMPONENTS 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.

As a BDC, we generally will be prohibited from acquiring assets other than qualifying assets unless, after giving effect to any acquisition, at least 70% of our total assets are qualifying assets. Qualifying assets generally include securities of eligible portfolio companies, cash, cash equivalents, U.S. government securities and high-quality debt instruments maturing in one year or less from the time of investment. Under the Investment Company Act and the rules thereunder, "eligible portfolio companies" include (i) private U.S. operating companies, (ii) public U.S. operating companies whose securities are not listed on a national securities exchange (e.g., the New York Stock Exchange) or registered under the Exchange Act, and (iii) public U.S. operating companies having a market capitalization of less than $250 million. Public U.S. operating companies whose securities are quoted on the over-the-counter bulletin board and through OTC Markets are not listed on a national securities exchange and therefore are eligible portfolio companies.

Revenues

We generate revenues in the form of interest income on debt investments and, to a lesser extent, capital gains and distributions, if any, on equity securities that we may acquire in portfolio companies. Some of our investments may provide for deferred interest payments or payment-in-kind ("PIK") income. The principal amount of the debt investments and any accrued but unpaid interest generally becomes due at the maturity date.

We generate revenues primarily through receipt of interest income from the investments we hold. In addition, we may generate revenue in the form of commitment, origination, structuring, syndication, exit fees or diligence fees, fees for providing managerial assistance and consulting fees. Portfolio company fees (directors' fees, consulting fees, administrative fees, tax advisory fees and other similar compensation) will be paid to us, unless, to the extent required by applicable law or exemptive relief, if any, therefrom, we receive our allocable portion of such fees when invested in the same portfolio company as other client accounts managed by our Investment Adviser (collectively with the Company, the "Accounts"), which other Accounts could receive their allocable portion of such fee. We do not expect to receive material fee income as it is not our principal investment strategy. We record contractual prepayment premiums on loans and debt securities as interest income.

Dividend income on preferred equity investments is recorded on an accrual basis to the extent that such amounts are payable by the portfolio company and are expected to be collected. Dividend income on common equity investments is recorded on the record date for private portfolio companies and on the ex-dividend date for publicly traded portfolio companies. Interest and dividend income are presented net of withholding tax, if any.

Expenses

Our primary operating expenses include the payment of the management fee (the "Management Fee") and the incentive fee (the "Incentive Fee") to our Investment Adviser, legal and professional fees, interest and other debt expenses and other operating and overhead related expenses. The Management Fee and Incentive Fee compensate our Investment Adviser for its work in identifying, evaluating, negotiating, closing and monitoring our investments. We bear all other expenses of our operations and transactions in accordance with the investment management and advisory agreement (the "Investment Management Agreement") and administration agreement (the "Administration Agreement"), including:

Our Investment Adviser will not be required to pay expenses of activities which are primarily intended to result in sales of Units.

We expect our general and administrative expenses to be relatively stable or decline as a percentage of total assets during periods of asset growth and to increase during periods of asset declines.

Leverage

We expect from time to time to borrow funds for a variety of purposes, subject to the limitations of the Investment Company Act, including to bridge fundings for investments in advance of drawdowns, as part of our investment strategy and to meet other short-term liquidity needs, including to pay the Management Fee. Sources of leverage include the issuance of senior securities (including preferred stock) and other credit facilities (secured by investments and/or pledges of undrawn commitments). Our secured credit facility (as amended, restated, supplemented or otherwise modified from time to time, the "Credit Facility") with Ally Bank, as administrative agent, allows us to borrow money and lever our investment portfolio, subject to the limitations of the Investment Company Act, with the objective of increasing our yield. This is known as "leverage" and could increase or decrease returns to our Unitholders. The use of leverage involves significant risks. We are permitted to borrow amounts such that our asset coverage ratio, as defined in the Investment Company Act, is at least 150% after such borrowing (if certain requirements are met).

Certain trading practices and investments, such as reverse repurchase agreements, may be considered borrowings or involve leverage and thus may be subject to Investment Company Act restrictions. Short-term credits necessary for the settlement of securities transactions and arrangements with respect to securities lending will not be considered borrowings for these purposes. Practices and investments that may involve leverage but are not considered borrowings are not subject to the Investment Company Act's asset coverage requirement. The amount of leverage that we employ will depend on the assessment by our Investment Adviser and our board of directors (the "Board of Directors" or the "Board") of market conditions and other factors at the time of any proposed borrowing.

PORTFOLIO AND INVESTMENT ACTIVITY

Our portfolio (excluding investments in money market funds, if any) consisted of the following:

		As of
		December 31, 2024								December 31, 2023
		Amortized Cost				Fair Value				Amortized Cost				Fair Value
		($ in millions)								($ in millions)
First Lien/Senior Secured Debt		$	562.62			$	562.47			$	149.45			$	149.83
First Lien/Last-Out Unitranche			39.67				39.64				27.54				27.59
Common Stock			2.25				2.31				-				-
Total investments		$	604.54			$	604.42			$	176.99			$	177.42

The weighted average yield by asset type of our portfolio (excluding investments in money market funds, if any), at amortized cost and fair value, was as follows:

		As of
		December 31, 2024								December 31, 2023
		Amortized Cost				Fair Value				Amortized Cost				Fair Value
Weighted Average Yield(1)
First Lien/Senior Secured Debt(2)			10.2	%			10.2	%			12.7	%			12.7	%
First Lien/Last-Out Unitranche(2)(3)			11.1	%			11.1	%			12.1	%			12.1	%
Common Stock(4)			-				-				-				-
Total Portfolio			10.2	%			10.2	%			12.6	%			12.6	%

As of December 31, 2024, the total portfolio weighted average yield measured at amortized cost and fair value was 10.2% and 10.2%, as compared to 12.6% and 12.6%, as of December 31, 2023. The decrease in total portfolio weighted average yield at amortized cost and fair value, and within First Lien/Senior Secured Debt and First Lien/Last-Out Unitranche weighted average yield at cost and fair value, was due to a decline in interest rates.

The following table presents certain selected information regarding our investment portfolio (excluding investments in money market funds, if any):

			As of
			December 31, 2024				December 31, 2023
Number of portfolio companies				65				29
Percentage of performing debt bearing a floating rate(1)				100.0	%			100.0	%
Percentage of performing debt bearing a fixed rate(1)(2)				-	%			-	%
Weighted average leverage (net debt/EBITDA)(3)				5.4	x			4.9	x
Weighted average interest coverage(3)				2.1	x			1.7	x
Median EBITDA(3)		$	76.31 million			$	56.78 million

(1)	Measured on a fair value basis. Excludes investments, if any, placed on non-accrual status.
(2)	Includes income producing preferred stock investments, if applicable.
(3)	For a particular portfolio company, we calculate the level of contractual indebtedness net of cash ("net debt") owed by the portfolio company and compare that amount to measures of cash flow available to service the net debt. To calculate net debt, we include debt that is both senior and pari passu to the tranche of debt owned by us but exclude debt that is legally and contractually subordinated in ranking to the debt owned by us. We believe this calculation method assists in describing the risk of our portfolio investments, as it takes into consideration contractual rights of repayment of the tranche of debt owned by us relative to other senior and junior creditors of a portfolio company. We typically calculate cash flow available for debt service at a portfolio company by taking EBITDA for the trailing twelve-month period. Weighted average net debt to EBITDA is weighted based on the fair value of our debt investments, excluding investments where net debt to EBITDA may not be the appropriate measure of credit risk, such as cash collateralized loans and investments that are underwritten and covenanted based on recurring revenue.
	For a particular portfolio company, we also calculate the level of contractual interest expense owed by the portfolio company and compare that amount to EBITDA ("interest coverage ratio"). We believe this calculation method assists in describing the risk of our portfolio investments, as it takes into consideration contractual interest obligations of the portfolio company. Weighted average interest coverage is weighted based on the fair value of our performing debt investments, excluding investments where interest coverage may not be the appropriate measure of credit risk, such as cash collateralized loans and investments that are underwritten and covenanted based on recurring revenue.
	Median EBITDA is based on our debt investments, excluding investments where net debt to EBITDA may not be the appropriate measure of credit risk, such as cash collateralized loans and investments that are underwritten and covenanted based on recurring revenue.
	Portfolio company statistics are derived from the most recently available financial statements of each portfolio company as of the reported end date. Statistics of the portfolio companies have not been independently verified by us and may reflect a normalized or adjusted amount.
	As of December 31, 2024 and December 31, 2023, investments where net debt to EBITDA may not be the appropriate measure of credit risk represented 11.8% and 35.7% of total debt investments at fair value.

Our Investment Adviser monitors, on an ongoing basis, the financial trends of each portfolio company to determine if it is meeting its respective business plan and to assess the appropriate course of action for each portfolio company. Our Investment Adviser has several methods of evaluating and monitoring the performance and fair value of our investments, which may include the following: (i) assessment of success in adhering to the portfolio company's business plan and compliance with covenants; (ii) periodic or regular contact with portfolio company management and, if appropriate, the financial or strategic sponsor to discuss financial position, requirements and accomplishments; (iii) comparisons to our other portfolio companies in the industry, if any; (iv) attendance at and participation in Board meetings or presentations by portfolio companies; and (v) review of monthly and quarterly financial statements and financial projections of portfolio companies.

As part of the monitoring process, our Investment Adviser also employs an investment rating system to categorize our investments. In addition to various risk management and monitoring tools, our Investment Adviser grades the credit risk of all investments on a scale of 1 to 4 no less frequently than quarterly. This system is intended primarily to reflect the underlying risk of a portfolio investment relative to our initial cost basis in respect of such portfolio investment (i.e., at the time of origination or acquisition), although it may also take into account in certain circumstances the performance of the portfolio company's business, the collateral coverage of the investment and other relevant factors. The grading system for our investments is as follows:

• Grade 1investments involve the least amount of risk to our initial cost basis. The trends and risk factors for this investment since origination or acquisition are generally favorable, which may include the performance of the portfolio company or a potential exit;

• Grade 2investments involve a level of risk to our initial cost basis that is similar to the risk to our initial cost basis at the time of origination or acquisition. This portfolio company is generally performing as expected and the risk factors to our ability to ultimately recoup the cost of our investment are neutral to favorable. All investments or acquired investments in new portfolio companies are initially assessed a grade of 2;

• Grade 3investments indicate that the risk to our ability to recoup the initial cost basis of such investment has increased materially since origination or acquisition, including as a result of factors such as declining performance and non-compliance with debt covenants; however, payments are generally not more than 120 days past due; and

• Grade 4investments indicate that the risk to our ability to recoup the initial cost basis of such investment has substantially increased since origination or acquisition, and the portfolio company likely has materially declining performance. For debt investments with an investment grade of 4, in most cases, most or all of the debt covenants are out of compliance and payments are substantially delinquent. For investments graded 4, it is anticipated that we will not recoup our initial cost basis and may realize a substantial loss of our initial cost basis upon exit.

Our Investment Adviser grades the investments in our portfolio at least each quarter and it is possible that the grade of a portfolio investment may be reduced or increased over time. For investments graded 3 or 4, our Investment Adviser enhances its level of scrutiny over the monitoring of such portfolio company. The following table shows the composition of our portfolio (excluding investments in money market funds, if any) on the 1 to 4 grading scale:

		As of
		December 31, 2024								December 31, 2023
Investment Performance Rating		Fair Value				Percentage of Total				Fair Value				Percentage of Total
		(in millions)								(in millions)
Grade 1		$	-				-	%		$	-				-	%
Grade 2			604.42				100.0				177.42				100.0
Grade 3			-				-				-				-
Grade 4			-				-				-				-
Total Investments		$	604.42				100.0	%		$	177.42				100.0	%

The following table shows the amortized cost of our performing and non-accrual investments (excluding investments in money market funds, if any):

		As of
		December 31, 2024								December 31, 2023
		Amortized Cost				Percentage of Total				Amortized Cost				Percentage of Total
		(in millions)								(in millions)
Performing		$	604.54				100.0	%		$	176.99				100.0	%
Non-accrual			-				-				-				-
Total Investments		$	604.54				100.0	%		$	176.99				100.0	%

Investments are placed on non-accrual status when it is probable that principal, interest or dividends will not be collected according to the contractual terms. Accrued interest or dividends generally are reversed when an investment is placed on non-accrual status. Interest or dividend payments received on non-accrual investments may be recognized as income or applied to principal depending upon management's judgment. Non-accrual investments are restored to accrual status when past due principal and interest or dividends are paid and, in management's judgment, principal and interest or dividend payments are likely to remain current. We may make exceptions to this treatment if the loan has sufficient collateral value and is in the process of collection.

The following table shows our investment activity by investment type(1):

		For the Year Ended December 31,				For the Year Ended December 31,
		2024				2023
		($ in millions)
Amount of investments committed at cost:
First Lien/Senior Secured Debt		$	612.02			$	178.84
First Lien/Last-Out Unitranche			4.95				43.16
Common Stock			2.25				-
Total		$	619.22			$	222.00
Proceeds from investments sold or repaid:
First Lien/Senior Secured Debt		$	54.11			$	15.36
Total		$	54.11			$	15.36
Net increase in portfolio		$	565.11			$	206.64
Number of new portfolio companies with new investment commitments			37				26
Total new investment commitment amount in new portfolio companies		$	533.71			$	210.62
Average new investment commitment amount in new portfolio companies			14.4				8.1
Number of existing portfolio companies with new investment commitments			10				1
Total new investment commitment amount in existing portfolio companies		$	85.51			$	11.38
Weighted average remaining term for new investment commitments (in years)(2)			5.9				5.1
Percentage of new debt investment commitments at floating interest rates			96.0	%			100.0	%
Percentage of new debt investment commitments at fixed interest rates(3)			-	%			-	%
Weighted average yield on new debt and income producing investment commitments(4)			10.4	%			12.5	%
Weighted average yield on new investment commitments(5)			10.3	%			12.5	%
Weighted average yield on debt and income producing investments sold or repaid(6)			10.6	%			12.7	%
Weighted average yield on investments sold or repaid(7)			10.6	%			12.7	%

RESULTS OF OPERATIONS

The comparison for the years ended December 31, 2023 and for the period from October 6, 2022 (commencement of operations) to December 31, 2022 can be found in Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations in our Form 10-K for the fiscal year ended December 31, 2023.

Our operating results were as follows:

		For the Year Ended December 31,				For the Year Ended December 31,
		2024				2023
		($ in millions)
Total investment income		$	42.41			$	11.63
Net expenses			(17.70	)			(7.01	)
Net investment income (loss)			24.71				4.62
Net realized gain (loss) on investments			-		(1)		0.02
Net unrealized appreciation (depreciation) on investments			(0.55	)			0.43
Net realized and unrealized gain (losses) on translations and transactions			0.51				-
Net realized and unrealized gains (losses)			(0.04	)			0.45
Net increase (decrease) in net assets from operations		$	24.67			$	5.07

(1)Amount rounds to less than 0.1.

Net increase in members' capital from operations can vary from period to period as a result of various factors, including acquisitions, the level of new investment commitments, the recognition of realized gains and losses and changes in unrealized appreciation and depreciation in the investment portfolio.

Investment Income

Our investment income was as follows:

		For the Year Ended December 31,				For the Year Ended December 31,
		2024				2023
		($ in millions)
Interest		$	40.67			$	9.46
Dividend income			0.88				2.04
Other income			0.86				0.13
Total investment income		$	42.41			$	11.63

Investment income for the year ended December 31, 2024 and for the year ended December 31, 2023 was driven by our deployment of capital into income producing investments.

Expenses

Our expenses were as follows:

		For the Year Ended December 31,				For the Year Ended December 31,
		2024				2023
		($ in millions)
Interest and other debt expenses		$	10.75			$	2.94
Incentive fees			1.73				0.21
Management fees			3.49				1.44
Directors' fees			0.12				0.14
Professional fees			0.70				0.88
Offering costs			-				1.00
Other general and administrative expenses			0.91				0.69
Total expenses		$	17.70				7.30
Management fee waiver			-				(0.29	)
Net Expenses		$	17.70			$	7.01

In the table above:

Net Change in Unrealized Appreciation (Depreciation) on Investments

Any changes in fair value are recorded as a change in unrealized appreciation (depreciation) on investments. For further details on the valuation process, refer to Note 2 "Significant Accounting Policies-Investments" in our consolidated financial statements. Net change in unrealized appreciation (depreciation) on investments were as follows:

		For the Year Ended December 31,
		2024				2023
		($ in millions)
Unrealized appreciation		$	1.94			$	0.59
Unrealized depreciation			(2.49	)		$	(0.16	)
Net change in unrealized appreciation (depreciation) on investments		$	(0.55	)		$	0.43

The net change in unrealized appreciation (depreciation) on investments consisted of the following:

		For the Year Ended December 31,
		2024
		($ in millions)
Portfolio company:
NCWS Intermediate, Inc. (dba National Carwash Solutions)		$	(0.71	)
Hamilton Thorne, Inc.			(0.50	)
Sonar Acquisitionco, Inc. (dba SimPRO)			(0.25	)
TM Restaurant Group LLC			(0.18	)
Artifact Bidco, Inc. (dba Avetta)			(0.08	)
Other, net (1)			0.02
Onyx CenterSource, Inc.			0.12
Singlewire Software, LLC			0.13
ASM Buyer, Inc.			0.22
Spotless Brands, LLC			0.22
VASA Fitness Buyer, Inc.			0.22
Fullsteam Operations LLC			0.24
Total		$	(0.55	)

(1)For the year ended December 31, 2024, Other, net includes gross unrealized appreciation of $0.78 million and gross unrealized depreciation of $(0.76) million.

		For the Year Ended December 31,
		2023
		($ in millions)
Portfolio Company:
Other, net (1)		$	0.18
DFS Holding Company, Inc.			0.06
Fullsteam Operations LLC			0.05
GPS Phoenix Buyer, Inc. (dba Guidepoint)			(0.01	)
Harrington Industrial Plastics, LLC			(0.01	)
Rubrik, Inc.			(0.01	)
Singlewire Software, LLC			0.08
Spotless Brands, LLC			0.11
TM Restaurant Group LLC			(0.13	)
UP Acquisition Corp. (dba Unified Power)			-
VASA Fitness Buyer, Inc.			0.11
Total		$	0.43

(1)For the year ended December 31, 2023, Other, net includes gross unrealized appreciation of $0.19 million and gross unrealized depreciation of $(0.01) million.

FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES

The primary use of existing funds and any funds raised in the future is expected to be for our investments in portfolio companies, cash distributions to our Unitholders or for other general corporate purposes, including paying for operating expenses or debt service to the extent we borrow or issue senior securities.

We expect to generate cash primarily from the net proceeds of any future offerings of our Units, drawdowns of capital commitments, future borrowings and cash flows from operations. Subject to the terms of our Amended and Restated Limited Liability Company Agreement (as it may be amended or amended and restated from time to time, the "LLC Agreement"), 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 of Directors otherwise determines that leveraging our portfolio would be in our best interest and the best interests of our Unitholders, we may enter into credit facilities in addition to our Credit Facility, or issue other senior securities. Subject to the terms of the LLC Agreement, we would expect any such credit facilities may be secured by certain of our assets and may contain advance rates based upon pledged collateral. The pricing and other terms of any such facilities would depend upon market conditions when we enter into any such facilities as well as the performance of our business, among other factors. As a BDC, with certain limited exceptions, we are only permitted to borrow amounts such that our asset coverage ratio, as defined in the Investment Company Act, is at least 150% after such borrowing (if certain requirements are met). We may also refinance or repay any of our indebtedness at any time based on our financial condition and market conditions. As of December 31, 2024 and December 31, 2023, our asset coverage ratio based on the aggregate amount outstanding of our senior securities was 283% and 1,053%. We may also refinance or repay any of our indebtedness at any time based on our financial condition and market conditions.

We may enter into investment commitments through signed commitment letters, that may ultimately become investment transactions in the future. We regularly evaluate and carefully consider our unfunded commitments using GSAM's proprietary risk management framework for the purpose of planning our capital resources and ongoing liquidity, including our financial leverage.

An affiliate of the Investment Adviser made a capital commitment to us of $10,000 on October 6, 2022 (commencement of operations) and served as our initial member (the "Initial Member"). We began accepting subscription agreements (the "Subscription Agreements") from investors acquiring Units in our private offering. Under the terms of the Subscription Agreements, investors are required to make capital contributions up to the amount of their undrawn capital commitment to purchase Units each time we deliver a drawdown notice.

As of the dates indicated, we had aggregate capital commitments and undrawn capital commitments from investors as follows:

		December 31, 2024												December 31, 2023
		Capital Commitments ($ in millions)				Unfunded Capital Commitments ($ in millions)				% of Capital Commitments Funded				Capital Commitments ($ in millions)				Unfunded Capital Commitments ($ in millions)				% of Capital Commitments Funded
Common Units		$	750.01			$	367.50				51	%		$	750.01			$	577.50				23	%

The following table summarizes the total Units issued and proceeds related to capital drawdowns:

Unit Issue Date		Units Issued				Proceeds Received ($ in millions)
For the Year Ended December 31, 2024
May 24, 2024			1,134,153			$	22.50
June 17, 2024			1,878,400				37.50
July 5, 2024			1,863,521				37.50
August 15, 2024			3,756,273				75.00
November 15, 2024			1,875,000				37.50
Total capital drawdowns			10,507,347			$	210.00
For the Year Ended December 31, 2023
September 18, 2023			1,906,612			$	37.50
October 31, 2023			1,887,267				37.50
Total capital drawdowns			3,793,879			$	75.00

Contractual Obligations

We have entered into certain contracts under which we have future commitments. Payments under the Investment Management Agreement, pursuant to which GSAM has agreed to serve as our Investment Adviser, are equal to (1) Management Fee equal to a percentage of value of our average NAV at the end of the then-current calendar quarter and the prior calendar quarter and (2) an Incentive Fee based on pre-incentive fee net investment income. Under the Administration Agreement, pursuant to which the Administrator will be responsible for providing us with various accounting and administrative services necessary to conduct our day-to-day operations, we pay our Administrator such fees as may be agreed between us and our Administrator that we determine are commercially reasonable in our sole discretion. Either party or the Unitholders, by a vote of a majority of our outstanding voting securities, may terminate the Investment Management Agreement without penalty on at least 60 days' written notice to the other party. Either party may terminate the Administration Agreement without penalty upon at least 30 days' written notice to the other party. The following table shows our contractual obligations as of December 31, 2024:

	Payments Due by Period ($ in millions)
	Total				Less Than 1 Year				1 - 3 Years				3 - 5 Years				More Than 5 Years
Credit Facility(1)	$	220.10			$	-			$	-			$	220.10			$	-

For further details, see Note 6 "Debt―Credit Facility" to our consolidated financial statements included in this report.

Off-Balance Sheet Arrangements

We may become a party to investment commitments and to financial instruments with off-balance sheet risk in the normal course of our business to fund investments and to meet the financial needs of our portfolio companies. These instruments may include commitments to extend credit and involve, to varying degrees, elements of liquidity and credit risk in excess of the amount recognized in the balance sheet. As of December 31, 2024, we believed that we had adequate financial resources to satisfy our unfunded commitments. Our unfunded commitments to provide funds to portfolio companies were as follows:

		As of
		December 31, 2024				December 31, 2023
		($ in millions)
Unfunded Commitments
First Lien/Senior Secured Debt		$	158.55			$	37.26
First Lien/Last-Out Unitranche			8.53				15.62
Total		$	167.08			$	52.88

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

Our discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP"). The preparation of these consolidated financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses. Changes in the economic environment, financial markets and any other parameters used in determining such estimates could cause actual results to differ materially.

For a description of our critical accounting policies, see Note 2 "Significant Accounting Policies" to our consolidated financial statements included in this report. We consider the most significant accounting policies to be those related to our Valuation of Portfolio Investments, Revenue Recognition, Non-Accrual Investments, Distribution Policy and Income Taxes. We consider the most significant critical estimate to be the fair value measurement of investments. The critical accounting policies and estimate should be read in connection with our risk factors listed under "Risk Factors" in this report.

Fair Value Measurement of Investments

Consistent with GAAP and the Investment Company Act, we conduct a valuation of our investments, pursuant to which our NAV is determined. Our investments are valued on a quarterly basis, or more frequently if required under the Investment Company Act. The determination of fair value involves subjective judgments and estimates. The majority of investments are not quoted or traded in an active market and as such their fair values are determined using valuation techniques, primarily discounted cash flows, market multiples, and recent comparable transactions. The most significant inputs in applying the discounted cash flow approach and the market multiples approach are the selected discount rates and multiples, respectively. The selection of these inputs is based on a combination of factors that are specific to the underlying portfolio companies such as financial performance and certain factors that are observable in the market such as current interest rates and comparable public company trading multiples. Accordingly, the notes to our consolidated financial statements express the uncertainty with respect to the possible effect of these valuations and any change in these valuations on the

consolidated financial statements. For further details of our investments and fair value measurement accounting policy, see Note 2 "Significant Accounting Policies-Investments" and Note 5 "Fair Value Measurement."

RECENT DEVELOPMENTS

We will pay a distribution equal to an amount up to our taxable earnings per Unit, including net investment income (if positive) for the period January 1, 2025 through March 31, 2025, payable on or about April 28, 2025 to Unitholders of record as of March 31, 2025.