DEF 14A of Morgan Stanley Direct Lending Fund
Filed Apr 23, 20240001104659-24-050583
ELECTION OF DIRECTORS
ELECTION OF DIRECTORS Our Board is presently composed of six Directors, divided into three classes, each serving staggered three- year terms. The term of our Class I Directors will expire at the 2026 annual meeting of stockholders; the term of our Class II Directors will expire at the Meeting; and the term of our Class III Directors will expire at the 2025 annual meeting of stockholders. The Board has nominated each of Jeffrey S. Levin and Joan Binstock, as a Director, each to serve until his or her successor has been elected and qualified at the annual meeting of stockholders to be held in 2027 or until his or her earlier resignation, removal, death or incapacity. Mr. Levin currently serves as a Chief Executive Officer, President, and a Director of the Company. Ms. Binstock currently serves as a Director of the Company, is a member of the Audit Committee of the Board (the “Audit Committee”), and the Compensation Committee of the Board (the “Compensation Committee”), and is the Chair of the Nominating and Corporate Governance Committee of the Board (the “Nominating and Corporate Governance Committee”). The Board has determined that Ms. Binstock is not an “interested person” of the Company, of MS Capital Partners Adviser Inc., our investment adviser (the “Adviser”), or of any of their respective affiliates, as defined in Section 2(a)(19) of the Investment Company Act of 1940, as amended (the “1940 Act”) (“Independent Director”). Each of Mr. Levin and Ms. Binstock has consented to being named in this Proxy Statement and to serving as a Director if elected at the Meeting. If, for any reason, Mr. Levin and Ms. Binstock becomes unable or unwilling to serve at the time of the Meeting, the persons named as proxies in the proxy will have the authority to vote for a substitute nominee or nominees. We do not anticipate Mr. Levin and Ms. Binstock will be unable or unwilling to serve. The Board recommends that stockholders vote “FOR” the Company’s nominees for Directors.
Biographical Information
Biographical Information The Board has determined that each of the Directors is qualified to serve as our Director, based on a review of the experience, qualifications, attributes and skills of each Director, including those described below. The Board has determined that each Director has significant experience in the investment or financial services industries and has held management, board or oversight positions in other companies and organizations. Each of our Directors has demonstrated high character and integrity and has expertise and diversity of experience to be able to offer advice and guidance to our management. In addition, set forth further below is a biography of each executive officer of the Company who is not a Director. Unless otherwise indicated by footnote, the address for each listed individual is c/o Morgan Stanley Direct Lending Fund, 1585 Broadway, 23rd Floor, New York, NY 10036.
Biographical Information
| | Age | Position(s) held with the Company | Expiration of Term | Director Since | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex Overseen by Director(1) | Other Directorships of Public or Registered Investment Companies Held by Director or Nominee for Director During Past Five Years | | Nominees for Class II Directors | | | | | | | | | Interested Director | | | | | | | | | Jeffrey S. Levin(2) | 43 | Chief Executive Officer and President, Director | 2024 | 2019 | Chief Executive Officer and President of the Company since October 2019; Chief Executive Officer and President of the other MS BDCs since their formation; Managing Director, Co-Head of Morgan Stanley’s North America Private Credit Team; Head of Direct Lending | 6 | None | | Independent Director | | | | | | | | | Joan Binstock | 70 | Director | 2024 | 2019 | Senior Advisor at Lovell Minnick Partners, LLC since July 2018 | 6 | Confluence Technologies, Inc. since April 2023; The 2023 ETF Series Trusts since 2023; Brown Brothers Harriman US Mutual Funds since September 2019; KKR Real Estate Select Trust, Inc. since August 2020 | | Incumbent Class I Directors | | | | | | | | | Interested Director | | | | | | | | | David Miller(3) | 48 | Chair of the Board of Directors | 2026 | 2019 | Global Head of Private Credit & Equity at Morgan Stanley and a member of the Morgan Stanley Investment Management (“MSIM” or “IM”) operating committee since 2016 | 6 | None | | Independent Director | | | | | | | | | Kevin Shannon | 69 | Director | 2026 | 2019 | Chief Financial Officer of the Harvard Management Company, Inc. from September 2009 to April 2020 | 6 | None |
Biographical Information
| | Age | Position(s) held with the Company | Expiration of Term | Director Since | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex Overseen by Director(1) | Other Directorships of Public or Registered Investment Companies Held by Director or Nominee for Director During Past Five Years | | Incumbent Class III Directors | | | | | | | | | Independent Directors | | | | | | | | | Bruce D. Frank | 70 | Director | 2025 | 2019 | Retired | 6 | Landsea Homes Corp. since 2015 | | Adam Metz | 62 | Director | 2025 | 2019 | Retired | 6 | Seritage Growth Properties (NYSE: SRG) since March 2022; Hammerson PLC since July 2019 |
Biographical Information
The “Fund Complex” consists of the Company, SL Investment Corp. (“SLIC”), T Series Middle Market Loan Fund LLC (“T Series”), North Haven Private Income Fund LLC (“PIF”), North Haven Private Income Fund A LLC (“PIF A”), and LGAM Private Credit LLC (“LGAM”) (each, an “MS BDC” and, together, the “MS BDCs”), each a business development company (“BDC”) that has the same investment adviser as the Company. (2) Mr. Levin is an Interested Director due to his positions as Chief Executive Officer and President of the Company and Co-Head the Private Credit team at Morgan Stanley, an affiliate of the Adviser. (3) Mr. Miller is an Interested Director due to his position as Global Head of Private Credit & Equity of Morgan Stanley, an affiliate of the Adviser, and a member of the MSIM operating committee. Set forth below is certain information relating to our Directors, including details on each Director nominee’s specific experience, qualifications, attributes or skills that led the Board to conclude that the person should serve as a Director of the Company.
Nominees for Election as Class II Directors
Nominees for Election as Class II Directors
Interested Director
Interested Director Jeffrey S. Levin has served as our Chief Executive Officer, President and a member of the Board since October 2019 and has served in the same capacity for the each of other MS BDCs since their formation. Mr. Levin is Co-Head of Morgan Stanley’s North America Private Credit team, where he serves on the Chair of the Direct Lending Investment Committee and is the Portfolio Manager and the Head of Direct Lending. Mr. Levin also serves as Co-Portfolio Manager of the Senior Loan Fund investment strategy. Prior to rejoining Morgan Stanley in February 2019, Mr. Levin was a Partner and Managing Director at The Carlyle Group and a part of the management team for The Carlyle Group’s Direct Lending Platform. In addition, Mr. Levin served as President of The Carlyle Group’s BDCs from May 2016 to February 2019. From 2012 to May 2016, Mr. Levin served as the Head of Origination for The Carlyle Group’s Direct Lending platform. Prior to joining The Carlyle Group in 2012, Mr. Levin was a founding member of the MS Private Credit platform, where he was responsible for originating, structuring and executing credit and private equity investments across various industries. Prior to that role, Mr. Levin was a member of the Leveraged & Acquisition Finance Group at Morgan Stanley, where he was responsible for originating and executing high yield bond and leveraged loan transactions. Mr. Levin received a B.B.A. from Emory University. Mr. Levin’s investing experience and experience as a senior officer of other BDCs led our Nominating and Corporate Governance Committee to conclude that Mr. Levin is qualified to serve as a Director.
Independent Director
Independent Director Joan Binstock has served as a member of our Board and Chair of our Nominating and Corporate Governance Committee since October 2019. Ms. Binstock has also served in the same capacity for each of the other MS BDCs since their formation. Ms. Binstock has served as an Advisor at Lovell Minnick Partners, LLC since July 2018, where she is responsible for assisting the firm on deal and operational due diligence activities across all portfolio companies. In addition, she has been a director of the Brown Brothers Harriman US Mutual Funds since September 2019, a member of the board of directors and the Audit Chair of KKR Real Estate Select Trust, Inc., a closed-end management investment company that has elected to be treated as a real estate investment trust, since August 2020, a member of the board of directors of Confluence Technologies, Inc. since April 2023 and a member of the board of directors and Audit Chair of The 2023 ETF Series Trusts since 2023. Ms. Binstock served as a Director of SimCorp A/S from April 2018 to March 2023. Ms. Binstock was a Partner at Lord, Abbett & Co. LLC from 2000 to March 2018, where she served as the Chief Financial Officer. Previously, Ms. Binstock was the Chief Operating Officer at Morgan Grenfell Asset Management. Prior to that, she was a Principal and National Director of the Regulatory and Risk Management Practice at Ernst & Young LLP, the Chief Administrative Officer at BEA/Credit Suisse, and the Chief Administrative Officer of the Capital Markets Group at Goldman Sachs. She served as a Member of the Association of Institutional Investors Board of Directors, was a Director of the Securities Industry and Financial Markets Association, and was a Member of the Global Board of Managers of Omgeo LLC until January 2018. Ms. Binstock is on the board of Duke School of Medicine Board of Visitors and on the Advisory Council of NY/NJ Year Up, and previously served on the board of the Greystone Foundation, each of which is a nonprofit organization. Ms. Binstock is a licensed Certified Public Accountant. She holds a M.B.A. from New York University and a B.A. from the University of Binghamton. Ms. Binstock’s investing experience and experience as a senior executive officer in several finance companies led our Nominating and Corporate Governance Committee to conclude that Ms. Binstock is qualified to serve as a Director.
Incumbent Class I Directors: Term Expiring 2026
Incumbent Class I Directors: Term Expiring 2026
Interested Director
Interested Director David N. Miller has served as the Chair of the Board since October 2019 and has served in the same capacity for each of the other MS BDCs since their formation. Mr. Miller is the Global Head of Private Credit & Equity at Morgan Stanley and a member of the MSIM operating committee. He also serves as the chair of the board of directors of each of the other MS BDCs. Mr. Miller joined Morgan Stanley in August 2016 and has over 25 years of investing experience. Prior to joining Morgan Stanley, from 2012 to January 2016, Mr. Miller was the President and Chief Executive Officer of Silver Bay Realty Trust Corp. (“Silver Bay”), a publicly traded real estate investment trust he co-founded in 2011 to capitalize on the significant dislocation in the residential housing market. Prior to Silver Bay, Mr. Miller was a Managing Director at Pine River Capital Management and Two Harbors Investment Corp. where he focused on investment strategy and new business development. During the global financial crisis (2008 – 2011), Mr. Miller served in various roles at the U.S. Department of Treasury (“Treasury”), including as the Chief Investment Officer of the Troubled Asset Relief Program where he created complex crisis response investment programs and managed its $700 billion portfolio. Prior to Treasury, Mr. Miller held various investment roles, including as a portfolio manager at HBK Investments and in the Special Situations Group at Goldman Sachs & Co., where he focused on opportunistic investments in public and private debt and equity. Mr. Miller received an M.B.A. from Harvard Business School and a B.A. magna cum laude in Economics from Dartmouth College where he was elected to Phi Beta Kappa. Mr. Miller’s investing experience and experience as a senior officer of several finance companies led our Nominating and Corporate Governance Committee to conclude that Mr. Miller is qualified to serve as a Director.
Independent Director
Independent Director Kevin Shannon has served as a member of the Board since October 2019 and Chair of the Compensation Committee since September 2023. Mr. Shannon has also served as a member of the board of directors of each of the other MS BDCs since their formation. Mr. Shannon also serves on the Advisory Committee of Efferent Health, LLC., a private healthcare startup venture in the medical imaging and data base management field. Mr. Shannon previously served as the Chief Financial Officer of the Harvard Management Company, Inc., the investment advisor for Harvard University’s general investment account, from September 2009 to April 2020. Mr. Shannon served on the Operating Committee from September 2009 to December 2018 and chaired the Valuation Committee from June 2015 to December 2017. In addition, since December 2016, he has overseen both investment and operations of Harvard University’s Trust & Gifts Group. Prior to joining Harvard Management Company, Inc., Mr. Shannon was the Chief Financial Officer and an Executive Vice President at Moore Capital Management, LLC, a large multi- strategy private investment company, where he worked for 15 years. During his tenure he was responsible for all treasury functions and served as a member of the board of directors, Risk Committee, and Valuation Committee. Mr. Shannon served two consecutive terms on the board of directors of the Managed Funds Association, a group representing the global alternative investment industry and its investors and was a member of its Executive Committee as Vice Chairman and Treasurer. Prior to Moore Capital Management, LLC, he was a senior executive at Lehman Brothers where he served as Senior Vice President and Chief Financial Officer of Lehman’s derivative products subsidiary and earlier as Director of Firm Trading Accounting and Controls. Prior to joining Lehman Brothers, Mr. Shannon began his career as an auditor at KPMG LLP, serving financial services clients. Mr. Shannon served a two-year tenure as a part time adjunct lecturer with Baruch College’s Department of Accounting. Mr. Shannon takes an active role in his community; he served on the board of Help for Children for 20 years until December 31, 2023 and was formerly a member of the Audit and Executive Committees, and he is currently a member of the Boston Economics Club. Mr. Shannon received his Bachelor of Science degree, magna cum laude, from New York University and an M.B.A. from Fairleigh Dickinson University. Mr. Shannon’s investing experience and experience as a senior executive officer in several finance companies led our Nominating and Corporate Governance Committee to conclude that Mr. Shannon is qualified to serve as a Director.
Incumbent Class III Directors: Expiring 2025
Incumbent Class III Directors: Expiring 2025
Independent Directors
Independent Directors Bruce D. Frank has served as a member of the Board and Chair of the Audit Committee since October 2019 and has served in the same capacity for each of the other MS BDCs since their formation. Mr. Frank is a member of the board of directors of Landsea Homes Corporation (f/k/a Landsea Holdings Corporation), where he has served on the board of directors since January 2015 and is currently serving as the Lead Independent Director, chair of the Audit Committee and a member of the Nominating and Governance and Compensation Committees. Mr. Frank previously served on the board of directors of VEREIT, Inc., a real estate operating company, from July 2014 to March 2017 and the board of directors of ACRE Realty Investors Inc., a real estate investment and operating company, from November 2014 to December 2018. Mr. Frank was a Senior Partner at Ernst & Young LLP’s real estate practice within the assurance service line from April 1997 through June 2014. Prior to joining Ernst & Young LLP, Mr. Frank worked at KPMG LLP, a public accounting firm, for 17 years. He has over 35 years of experience providing assurance services to prominent public and private owners, investors and developers, both domestically and globally. His extensive experience has included working on initial public offerings and assisting acquirers in consummating acquisition transactions. Mr. Frank received a Bachelor of Science degree in Accounting from Bentley College, is a member of the American Institute of Certified Public Accountants and is a Certified Public Accountant in the State of New York. Mr. Frank’s past experience as an accountant led our Nominating and Corporate Governance Committee to conclude that Mr. Frank is qualified to serve as a Director. Adam Metz has served as a member of the Board since October 2019 and has served in the same capacity for each of the other MS BDCs since their formation. Mr. Metz has spent over 40 years in the real estate industry. Mr. Metz has served as a director of Hammerson PLC, a British property company, since July 2019. He also serves as chairman of the board of Seritage Growth Properties (NYSE: SRG), a national owner and developer of retail, residential and mixed use properties. Mr. Metz joined The Carlyle Group in October 2013 where he served as Head of International Real Estate and a member of the Management Committee until April 2018. Prior to his tenure at Carlyle, he was a Senior Advisor to Texas Pacific Group Capital’s (“TPG”) Real Estate Group. Prior to his role at TPG, Mr. Metz was the Chief Executive Officer of General Growth Properties and led the company through one of the largest and most successful bankruptcy and restructurings in real estate investment trust (“REIT”) history. Previously, Mr. Metz co-founded Polaris Capital, LLC, a real estate investment firm. Mr. Metz also served as Executive Vice President and Chief Investment Officer of Rodamco, North America, and President and Chief Financial Officer of Urban Shopping Centers. Prior to these roles, Mr. Metz was a Vice President in the Capital Markets group of JMB Realty, and in the Commercial Real Estate Lending Group at The First National Bank of Chicago as a Corporate Lending Officer. Mr. Metz has served on the advisory boards of the real estate programs at both Cornell University and Northwestern University and on the Smithsonian’s Hirshhorn Museum and Sculpture Garden Board of Trustees in Washington, DC, where he serves as Vice Chair. Previously, Mr. Metz served as an independent director on numerous boards including Galata Acquisition Corp., from June 2021 to July 2023, Forest City Enterprises from April 2018 to December 2018, Parkway Properties, Aliansce Shopping Centers S.A., AMLI Residential Properties Trust, Bally Total Fitness Holding Corp., and Chia’sso Acquisition LLC. Mr. Metz received his Bachelor’s degree from Cornell University, and a Masters of Management degree from Northwestern University. Mr. Metz’s investing experience and experience as a senior executive officer in several real estate companies led our Nominating and Corporate Governance Committee to conclude that Mr. Metz is qualified to serve as a Director.
Equity Owned by Directors and Nominees in the Company
Equity Owned by Directors and Nominees in the Company The following table sets forth the dollar range of equity securities of the Company and of the other MS BDCs in the Fund Complex beneficially owned by each Director or Director nominee as of the Record Date.
Equity Owned by Directors and Nominees in the Company
| | Dollar Range of Common Stock Beneficially Owned in the Company(1)(2) | Aggregate Dollar Range of Equity Securities Beneficially Owned in the Fund Complex(1)(3) | | Interested Directors | | | | David N. Miller | Over $100,000 | Over $100,000 | | Jeffrey S. Levin | Over $100,000 | Over $100,000 | | Independent Directors | | | | Joan Binstock | Over $100,000 | Over $100,000 | | Bruce D. Frank | $50,001 – $100,000 | Over $100,000 | | Kevin Shannon | Over $100,000 | Over $100,000 | | Adam Metz | Over $100,000 | Over $100,000 |
Equity Owned by Directors and Nominees in the Company
(1) The dollar ranges used in the above table are: None, $1 – $10,000, $10,001 – $50,000, $50,001 – $100,000, or over $100,000. (2) The dollar ranges for the Company were determined using the number of shares beneficially owned as of April 4, 2024 multiplied by the closing sales price of the Company’s common stock as reported on the New York Stock Exchange (the “NYSE”) on April 4, 2024. The dollar ranges for PIF were determined using the number of units that were beneficially owned as of the Record Date, multiplied by $19.12 per unit, which was the price at which PIF sold Class S Units on March 1, 2024. No shares of common stock of T Series, SLIC, PIF A or LGAM were beneficially owned by any Director or Director nominee as of the Record Date.
Executive Officers Who Are Not Directors
Executive Officers Who Are Not Directors
Executive Officers Who Are Not Directors
| | Age | Position | Number of Portfolios in Fund Complex Overseen by Officer(1) | Officer Since | | Orit Mizrachi | 52 | Chief Operating Officer | 6 | 2019 | | Michael Occi | 40 | Chief Administrative Officer | 6 | 2023 | | David Pessah | 38 | Chief Financial Officer | 6 | 2023 | | Gauranga Pal | 46 | Chief Compliance Officer | 6 | 2023 |
Executive Officers Who Are Not Directors
The Fund Complex consists of the MS BDCs. Orit Mizrachi was appointed as our Chief Operating Officer in October 2019 and has served in the same capacity for each of the other MS BDCs since their formation. Ms. Mizrachi has been a Managing Director of MSIM since January 2023 and previously served as an Executive Director of MSIM from April 2019 to December 2022. Prior to joining Morgan Stanley in April 2019, Ms. Mizrachi held various senior positions at The Carlyle Group from 2010 to 2018, including the Chief Operating Officer of the direct lending platform and The Carlyle Group’s BDCs as well as serving as interim Chief Financial Officer of The Carlyle Group’s BDCs from September 2014 through March 2015. Prior to joining The Carlyle Group in 2010, Ms. Mizrachi worked in the hedge fund industry as a chief financial officer and controller. Ms. Mizrachi started her career in public accounting as an auditor. Ms. Mizrachi has a Bachelor of Science in Accounting. Michael Occi was appointed as our Chief Administrative Officer in January 2023 and serves in the same capacity for each of the other MS BDCs. Mr. Occi has been a Managing Director of MSIM since April 2022. Mr. Occi joined Morgan Stanley in 2006. Prior to joining MSIM, Mr. Occi served as Head of Financial Institutions Equity Capital Markets between May 2019 and April 2022. Previously, Mr. Occi held a variety of other roles within Equity Capital Markets as well as in the financial institutions coverage areas in Fixed Income Capital Markets and in the Investment Banking Division. Mr. Occi graduated magna cum laude from Georgetown University, with a BA in Finance and Accounting. David Pessah was appointed as our Chief Financial Officer in December 2023 and serves in the same capacity for each of the other MS BDCs. Mr. Pessah has been a Managing Director of MSIM since December 2023. Prior to joining Morgan Stanley, Mr. Pessah held various positions at Goldman Sachs from September 2010 to November 2023, most recently as the Chief Financial Officer, Treasurer and Chief Accounting Officer of its business development company complex within Goldman Sachs’ Private Credit group. Mr. Pessah started his career in September 2007 at Ernst & Young LLP as an auditor in their financial services group. Mr. Pessah received his Bachelor of Science in Accounting from the University of Delaware and his MBA in Finance from Baruch College. Gauranga Pal was appointed as our Chief Compliance Officer in May 2023 and serves in the same capacity for the MS BDCs. In addition, Mr. Pal serves as Executive Director of MSIM. Mr. Pal joined MSIM in 2023. Prior to joining Morgan Stanley, Mr. Pal served as a Managing Director and Head of Investments Compliance of Blue Owl Capital where he served as from March 2021 to February 2023. Prior to Blue Owl Capital, Mr. Pal held various positions at Goldman Sachs between January 2005 to February 2021, most recently a Vice President and Senior Compliance Officer. Mr. Pal received his bachelor of technology in Chemical Engineering from the Indian Institute of Technology Kanpur and his MBA from the City University of New York.
CORPORATE GOVERNANCE
CORPORATE GOVERNANCE
Our Board of Directors
Our Board of Directors
Compensation of Independent Directors
Compensation of Independent Directors Prior to the completion of our initial public offering on January 26, 2024, the Independent Directors received: (i) an annual fee of $75,000 (prorated for any partial year), (ii) $2,000 for each in-person Board meeting attended ($1,000 for each telephonic Board meeting), (iii) $1,000 for each in-person committee meeting attended ($500 for each telephonic committee meeting) (provided that such compensation is only paid if the committee meeting is not held on the same day as any regular meeting of the Board), and (iv) an additional fee of $7,500 per year for the chair of the Audit Committee. Following the completion of our initial public offering on January 26, 2024, Independent Directors receive an annual fee of $125,000 (prorated for any partial year) and an additional fee of $15,000 per year for the chair of the Audit Committee. We also pay the reasonable out-of-pocket expenses for each Independent Director incurred in connection with fulfillment of his or her duties as an Independent Director. The Independent Directors review their own compensation and recommend to the Board the appropriate level of compensation. This level of compensation may be adjusted from time to time. In conducting their review, the Independent Directors use such information as they deem relevant, including compensation paid to directors of other BDCs of similar size and the time and effort required of the Directors in fulfilling their responsibilities to the Company. The Board determines the compensation of the Independent Directors. The following table sets forth information concerning total compensation earned by or paid to each of our Independent Directors during the fiscal year ended December 31, 2023. No compensation is paid by the Company to any Interested Director of the Company.
Compensation of Independent Directors
| | Total Compensation from the Company | Total Compensation from the Fund Complex(1) | | Joan Binstock | $75,000 | $276,164 | | Bruce D. Frank | $82,500 | $302,733 | | Kevin Shannon | $75,000 | $276,164 | | Adam Metz | $75,000 | $276,164 |
Compensation of Independent Directors
The “Fund Complex” consists of the MS BDCs.