UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-23896
Manulife Private Credit Plus Fund
(Exact name of registrant as specified in charter)
200 Berkeley Street, Boston, Massachusetts 02116 (Address of principal executive offices) (Zip code)
Salvatore Schiavone
Treasurer
200 Berkeley Street
Boston, Massachusetts 02116
(Name and address of agent for service) Registrant's telephone number, including area code: 617-543-9634
Date of fiscal year end: | December 31 |
Date of reporting period: | December 31, 2023 |
ITEM 1. REPORTS TO STOCKHOLDERS.
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Manulife Investment Management
John Hancock Investment Management
Head of Wealth and Asset Management,
United States and Europe
ANNUAL REPORT | MANULIFE PRIVATE CREDIT PLUS FUND | 1 |
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2 | MANULIFE PRIVATE CREDIT PLUS FUND | ANNUAL REPORT |
Shares | Value | ||||
Affiliated investment companies (A) 87.9% | $53,077,254 | ||||
(Cost $52,550,790) | |||||
Alternative and specialty 57.9% | 34,935,919 | ||||
John Hancock Asset-Based Lending Fund, Class I (Marathon) | 993,821 | 19,975,808 | |||
Manulife Private Credit Fund (MIM US Private Markets) | 721,313 | 14,960,111 | |||
Fixed income 30.0% | 18,141,335 | ||||
John Hancock Corporate Bond ETF (MIM US) (B) | 243,695 | 5,212,953 | |||
John Hancock Mortgage-Backed Securities ETF (MIM US) (B) | 593,339 | 12,928,382 | |||
Yield* (%) | Maturity date | Par value^ | Value | ||
Short-term investments 10.6% | $6,402,444 | ||||
(Cost $6,402,444) | |||||
Commercial paper 8.1% | 4,894,326 | ||||
Chariot Funding LLC | 5.400 | 01-12-24 | 1,900,000 | 1,896,865 | |
Manhattan Asset Funding Company LLC | 5.400 | 01-10-24 | 1,000,000 | 998,650 | |
MUFG Bank, Ltd. | 5.350 | 01-05-24 | 2,000,000 | 1,998,811 | |
U.S. Government Agency 2.5% | 1,508,118 | ||||
Federal Home Loan Bank Discount Note | 5.260 | 01-05-24 | 1,509,000 | 1,508,118 |
Total investments (Cost $58,953,234) 98.5% | $59,479,698 | ||||
Other assets and liabilities, net 1.5% | 926,500 | ||||
Total net assets 100.0% | $60,406,198 |
The percentage shown for each investment category is the total value of the category as a percentage of the net assets of the fund unless otherwise indicated. | |
^All par values are denominated in U.S. dollars unless otherwise indicated. | |
Security Abbreviations and Legend | |
(A) | The underlying funds’ advisor/subadvisor is shown parenthetically. |
(B) | The subadvisor is an affiliate of the advisor. |
* | Yield represents either the annualized yield at the date of purchase, the stated coupon rate or, for floating rate securities, the rate at period end. |
SEE NOTES TO FINANCIAL STATEMENTS | ANNUAL REPORT | MANULIFE PRIVATE CREDIT PLUS FUND | 3 |
Advisors/Subadvisors of Affiliated Underlying Funds | |
Manulife Investment Management Private Markets (US) LLC | (MIM US Private Markets) |
Manulife Investment Management (US) LLC | (MIM US) |
Marathon Asset Management LP | (Marathon) |
4 | MANULIFE PRIVATE CREDIT PLUS FUND | ANNUAL REPORT | SEE NOTES TO FINANCIAL STATEMENTS |
Assets | |
Unaffiliated investments, at value (Cost $6,402,444) | $6,402,444 |
Affiliated investments, at value (Cost $52,550,790) | 53,077,254 |
Total investments, at value (Cost $58,953,234) | 59,479,698 |
Cash | 769,555 |
Dividends receivable | 783,074 |
Receivable from affiliates | 42,421 |
Other assets | 390,767 |
Total assets | 61,465,515 |
Liabilities | |
Distributions payable | 978,701 |
Payable to affiliates | |
Accounting and legal services fees | 1,093 |
Other liabilities and accrued expenses | 79,523 |
Total liabilities | 1,059,317 |
Net assets | $60,406,198 |
Net assets consist of | |
Paid-in capital | $59,987,833 |
Total distributable earnings (loss) | 418,365 |
Net assets | $60,406,198 |
Net asset value per share | |
Based on net asset value and shares outstanding - the fund has an unlimited number of shares authorized with no par value | |
Class I ($60,406,198 ÷ 2,981,481 shares) | $20.26 |
SEE NOTES TO FINANCIAL STATEMENTS | ANNUAL REPORT | Manulife Private Credit Plus Fund | 5 |
Investment income | |
Dividends from affiliated investments | $913,800 |
Interest | 33,829 |
Total investment income | 947,629 |
Expenses | |
Investment management fees | 110,397 |
Accounting and legal services fees | 1,093 |
Transfer agent fees | 24,987 |
Custodian fees | 6,142 |
Printing and postage | 1,816 |
Professional fees | 68,572 |
Offering and organization costs | 316,258 |
Other | 3,355 |
Total expenses | 532,620 |
Less expense reductions | (443,426) |
Net expenses | 89,194 |
Net investment income | 858,435 |
Change in net unrealized appreciation (depreciation) of | |
Affiliated investments | 526,464 |
526,464 | |
Net realized and unrealized gain | 526,464 |
Increase in net assets from operations | $1,384,899 |
1 Period from 10-16-23 (commencement of operations) to 12-31-23. |
6 | Manulife Private Credit Plus Fund | ANNUAL REPORT | SEE NOTES TO FINANCIAL STATEMENTS |
Period ended 12-31-231 | |
Increase (decrease) in net assets | |
From operations | |
Net investment income | $858,435 |
Change in net unrealized appreciation (depreciation) | 526,464 |
Increase in net assets resulting from operations | 1,384,899 |
Distributions to shareholders | |
From earnings | (978,701) |
Total distributions | (978,701) |
Fund share transactions | |
Fund shares issued | 60,000,000 |
Total increase | 60,406,198 |
Net assets | |
Beginning of period | — |
End of period | $60,406,198 |
Share activity | |
Shares outstanding | |
Beginning of period | — |
Fund shares issued | 2,981,481 |
End of period | 2,981,481 |
1 | Period from 10-16-23 (commencement of operations) to 12-31-23. |
SEE NOTES TO FINANCIAL STATEMENTS | ANNUAL REPORT | Manulife Private Credit Plus Fund | 7 |
CLASS I SHARES Period ended | 12-31-231 |
Per share operating performance | |
Net asset value, beginning of period | $20.00 |
Net investment income2 | 0.43 |
Net realized and unrealized gain (loss) on investments | 0.16 |
Total from investment operations | 0.59 |
Less distributions | |
From net investment income | (0.33) |
Net asset value, end of period3 | $20.26 |
Total return (%)4 | 2.945 |
Ratios and supplemental data | |
Net assets, end of period (in millions) | $60 |
Ratios (as a percentage of average net assets): | |
Expenses before reductions6 | 1.325 |
Expenses including reductions6 | 0.225 |
Net investment income | 2.135 |
Portfolio turnover (%) | 07 |
1 | Period from 10-16-23 (commencement of operations) to 12-31-23. |
2 | Based on average monthly shares outstanding. |
3 | The fund is a continuously offered closed-end fund, the shares of which are offered at net asset value. No secondary market for the fund’s shares exists. |
4 | Total returns would have been lower had certain expenses not been reduced during the period. |
5 | Not annualized. |
6 | Ratios do not include expenses indirectly incurred from underlying funds and can vary based on the mix of underlying funds held by the fund. |
7 | Portfolio turnover for the period is 0% due to no sales activity. |
8 | Manulife Private Credit Plus Fund | ANNUAL REPORT | SEE NOTES TO FINANCIAL STATEMENTS |
ANNUAL REPORT | Manulife Private Credit Plus Fund | 9 |
Total value at 12-31-23 | Level 1 quoted price | Level 2 significant observable inputs | Level 3 significant unobservable inputs | |
Investments in securities: | ||||
Assets | ||||
Affiliated investment companies | $38,117,143 | $38,117,143 | — | — |
Short-term investments | 6,402,444 | — | $6,402,444 | — |
Investments valued at NAV1 | 14,960,111 | |||
Total investments in securities | $59,479,698 | $38,117,143 | $6,402,444 | — |
1Certain investments of the fund were fair valued using the NAV as practical expedient as no quoted market value is available and therefore have been excluded from the fair value hierarchy. |
10 | Manulife Private Credit Plus Fund | ANNUAL REPORT |
December 31, 2023 | |
Ordinary income | $978,701 |
ANNUAL REPORT | Manulife Private Credit Plus Fund | 11 |
12 | Manulife Private Credit Plus Fund | ANNUAL REPORT |
Affiliated Fund | Percentage of underlying fund net assets |
John Hancock Asset-Based Lending Fund | 14.7% |
John Hancock Corporate Bond ETF | 16.9% |
John Hancock Mortgage-Backed Securities ETF | 28.6% |
Manulife Private Credit Fund | 22.5% |
Dividends and distributions | |||||||||
Affiliate | Ending share amount | Beginning value | Cost of purchases | Proceeds from shares sold | Realized gain (loss) | Change in unrealized appreciation (depreciation) | Income distributions received | Capital gain distributions received | Ending value |
John Hancock Asset-Based Lending Fund | 993,821 | — | $20,000,000 | — | — | $(24,192) | $447,339 | — | $19,975,808 |
John Hancock Corporate Bond ETF | 243,695 | — | 5,016,474 | — | — | 196,479 | 39,661 | — | 5,212,953 |
John Hancock Mortgage-Backed Securities ETF | 593,339 | — | 12,534,316 | — | — | 394,066 | 91,065 | — | 12,928,382 |
Manulife Private Credit Fund | 721,313 | — | 15,000,000 | — | — | (39,889) | 335,735 | — | 14,960,111 |
— | $526,464 | $913,800 | — | $53,077,254 |
ANNUAL REPORT | Manulife Private Credit Plus Fund | 13 |
14 | Manulife Private Credit Plus Fund | ANNUAL REPORT |
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• | 50% to 70% of its net assets in senior loans; |
• | 20% to 40% of its net assets in asset-based lending investments and/or credit investments; and |
• | 0% to 20% of its net assets in liquid investments including, but not limited to, publicly traded debt instruments (broadly syndicated loans, high yield bonds, convertible securities and notes), money market funds and other short-term bond funds and U.S. Treasury securities. |
ANNUAL REPORT | MANULIFE PRIVATE CREDIT PLUS FUND | 17 |
18 | MANULIFE PRIVATE CREDIT PLUS FUND | ANNUAL REPORT |
ANNUAL REPORT | MANULIFE PRIVATE CREDIT PLUS FUND | 19 |
20 | MANULIFE PRIVATE CREDIT PLUS FUND | ANNUAL REPORT |
• | Affiliated Subadvised Fund Conflicts of Interest Risk. The Subadvisor may allocate the fund’s assets without limit to underlying funds managed by the Subadvisor and/or other affiliated subadvisors (“Affiliated Subadvised Funds”). Accordingly, rebalancings of the assets of the fund present a conflict of interest because there is an incentive for the Subadvisor to allocate assets to the Subadvisor and other Affiliated Subadvised Funds rather than underlying funds managed by unaffiliated subadvisors. In this regard, the Subadvisor and other affiliated subadvisors of Affiliated Subadvised Funds benefit from the Subadvisor’s allocations of fund assets to such funds through the additional fees they earn on such allocated fund assets. The Subadvisor has a duty to allocate assets only to underlying funds it has determined are in the best interests of shareholders, and make allocations to Affiliated Subadvised Funds on this basis without regard to any such economic incentive. As part of its oversight of the fund and the Subadvisor, the Advisor will monitor to ensure that allocations are conducted in accordance with these principles. |
• | Multi-Manager Risk; Limited Universe of Subadvisors and Underlying Funds. A fund’s ability to achieve its investment objective depends upon a subadvisor’s skill in determining a fund’s strategic allocation to investment strategies and in selecting the best mix of underlying funds. The allocation of investments among the different subadvisors managing underlying funds with different styles and asset classes, such as equity, debt, U.S., or foreign securities, may have a more significant effect on the performance of a fund of funds when one of these investments is performing more poorly than the other. There is no assurance that allocation decisions will result in the desired effects. Investment decisions made by the subadvisor may cause a fund of funds to incur losses or to miss profit opportunities on which it might otherwise have capitalized. Moreover, at times, the Subadvisor may invest fund assets in underlying funds managed by a limited number of subadvisors. In such circumstances, the fund’s performance could be substantially dependent on the performance of these subadvisors. Similarly, the Subadvisor’s allocation of a fund of fund’s assets to a limited number of underlying funds may adversely affect the performance of the fund of funds, and, in such circumstances, it will be more sensitive to the performance and risks associated with those funds and any investments in which such underlying funds focus. |
ANNUAL REPORT | MANULIFE PRIVATE CREDIT PLUS FUND | 21 |
22 | MANULIFE PRIVATE CREDIT PLUS FUND | ANNUAL REPORT |
ANNUAL REPORT | MANULIFE PRIVATE CREDIT PLUS FUND | 23 |
Payment Date | Income Distributions |
January 25, 2024 | $0.3283 |
Total | $0.3283 |
SS&C GIDS, Inc.
80 Lamberton Road
Windsor, Connecticut 06095
24 | MANULIFE PRIVATE CREDIT PLUS FUND | ANNUAL REPORT |
SS&C GIDS, Inc.
80 Lamberton Road
Windsor, Connecticut 06095
ANNUAL REPORT | MANULIFE PRIVATE CREDIT PLUS FUND | 25 |
(a) | the advisory agreement between the New Fund and John Hancock Investment Management LLC (the Advisor) (the Advisory Agreement); and |
(b) | the subadvisory agreement between the Advisor and Manulife Investment Management (US) LLC (the Subadvisor), with respect to the New Fund (the Subadvisory Agreement). |
26 | MANULIFE PRIVATE CREDIT PLUS FUND | ANNUAL REPORT |
(a) | the skills and competency with which the Advisor has in the past managed the affairs and subadvisory relationships for the John Hancock Fund Complex, the Advisor’s oversight and monitoring of the subadvisors’ investment performance and compliance programs, such as the subadvisors’ compliance with fund policies and objectives; review of brokerage matters, including with respect to trade allocation and best execution; and the Advisor’s timeliness in responding to performance and other issues; |
(b) | the background, qualifications, and skills of the Advisor’s personnel; |
(c) | the Advisor’s compliance policies and procedures and its responsiveness to regulatory changes and fund industry developments; |
(d) | the Advisor’s administrative capabilities, including its ability to supervise the other service providers for the New Fund, as well as the Advisor’s oversight of any securities lending activity, its monitoring of class action litigation and collection of class action settlements on behalf of the New Fund, and bringing loss recovery actions on behalf of the New Fund; |
(e) | the financial condition of the Advisor and whether it has the financial wherewithal to provide a high level and quality of services to the New Fund; |
ANNUAL REPORT | MANULIFE PRIVATE CREDIT PLUS FUND | 27 |
(f) | the Advisor’s initiatives intended to improve various aspects of the New Fund’s operations and investor experience with the New Fund; and |
(g) | the Advisor’s reputation and experience in serving as an investment advisor to the John Hancock Fund Complex, and the benefit to shareholders of investing in funds that are part of a family of funds offering a variety of investments. |
(a) | reviewed financial information of the Advisor; |
(b) | noted that because the New Fund had not yet commenced operations, no actual revenue, cost or profitability data was available, although the Board received information from the Adviser on its projected profitability with respect to the New Fund; |
(c) | received and reviewed profitability information with respect to the John Hancock Fund Complex as a whole; |
(d) | received information with respect to the Advisor’s allocation methodologies used in preparing the profitability data; |
(e) | considered that the John Hancock insurance companies that are affiliates of the Advisor, as shareholders of the New Fund directly or through their separate accounts, receive certain tax credits or deductions relating to foreign taxes paid and dividends received by certain funds of the New Fund and noted that these tax benefits, which are not available to participants in qualified retirement plans under applicable income tax law, are reflected in the profitability information reviewed by the Board; |
(f) | considered that the Advisor will also provide administrative services to the New Fund on a cost basis pursuant to an administrative services agreement; |
28 | MANULIFE PRIVATE CREDIT PLUS FUND | ANNUAL REPORT |
(g) | noted that the New Fund’s Subadvisor is an affiliate of the Advisor; |
(h) | noted that affiliates of the Advisor will provide transfer agency services and distribution services to the New Fund; |
(i) | noted that the Advisor will derive reputational and other indirect benefits from providing advisory services to the New Fund; |
(j) | noted that the subadvisory fee for the New Fund will be paid by Advisor; and |
(k) | considered that the Advisor should be entitled to earn a reasonable level of profits in exchange for the level of services it will provide to the New Fund and the risks that it assumes as Advisor, including entrepreneurial, operational, reputational, litigation and regulatory risk. |
(a) | considered that the Advisor has agreed to waive all of its management fee and/or reimburse or pay operating expenses of the New Fund to reduce operating expenses to zero; |
(b) | reviewed the proposed advisory fee structure for the New Fund and concluded that although economies of scale cannot be measured with precision, these arrangements will permit shareholders of the New Fund to benefit from economies of scale if the New Fund grows. The Board also took into account management’s discussion of the New Fund’s advisory fee structure, including incentive fee; and |
(c) | the Board also considered the potential effect of the New Fund’s future growth in size on its performance and fees. The Board also noted that if the New Fund’s assets increase over time, the New Fund may realize other economies of scale. |
(a) | information relating to the Subadvisor’s business; |
(b) | the performance of comparable funds, as applicable, managed fy the New Fund’s Subadvisor; |
(c) | the proposed subadvisory fee for the New Fund; and |
(d) | information relating to the nature and scope of any material relationships and their significance to the New Fund’s Advisor and Subadvisor. |
ANNUAL REPORT | MANULIFE PRIVATE CREDIT PLUS FUND | 29 |
(1) | the Subadvisor has extensive experience and demonstrated skills as a manager, and may reasonably be expected to provide a high quality of investment management services to the New Fund; |
(2) | the proposed subadvisory fees are reasonable in relation to the level and quality of services to be provided under the Subadvisory Agreement; and |
(3) | that the subadvisory fees will be paid by the Advisor not the New Fund. |
30 | MANULIFE PRIVATE CREDIT PLUS FUND | ANNUAL REPORT |
ANNUAL REPORT | MANULIFE PRIVATE CREDIT PLUS FUND | 31 |
Independent Trustees | ||
Name, year of birth Position(s) held with Trust Principal occupation(s) and other directorships during past 5 years | Trustee of the Trust since1 | Number of John Hancock funds overseen by Trustee |
Hassell H. McClellan,2 Born: 1945 | 2023 | 183 |
Trustee and Chairperson of the Board | ||
Trustee of Berklee College of Music (since 2022); Director/Trustee, Virtus Funds (2008-2020); Director, The Barnes Group (2010-2021); Associate Professor, The Wallace E. Carroll School of Management, Boston College (retired 2013). Trustee (since 2005) and Chairperson of the Board (since 2017) of various trusts within the John Hancock Fund Complex. | ||
William H. Cunningham,3 Born: 1944 | 2023 | 181 |
Trustee | ||
Professor, University of Texas, Austin, Texas (since 1971); former Chancellor, University of Texas System and former President of the University of Texas, Austin, Texas; Director (since 2006), Lincoln National Corporation (insurance); Director, Southwest Airlines (since 2000). Trustee of various trusts within the John Hancock Fund Complex (since 1986). | ||
Grace K. Fey, 3 Born: 1946 | 2023 | 183 |
Trustee | ||
Chief Executive Officer, Grace Fey Advisors (since 2007); Director and Executive Vice President, Frontier Capital Management Company (1988–2007); Director, Fiduciary Trust (since 2009). Trustee of various trusts within the John Hancock Fund Complex (since 2008). |
Non-Independent Trustees4 | ||
Name, year of birth Position(s) held with Trust Principal occupation(s) and other directorships during past 5 years | Trustee of the Trust since1 | Number of John Hancock funds overseen by Trustee |
Andrew G. Arnott, Born: 1971 | 2023 | 181 |
President and Non-Independent Trustee | ||
Global Head of Retail for Manulife (since 2022); Head of Wealth and Asset Management, United States and Europe, for John Hancock and Manulife (2018-2023); Director and Chairman, John Hancock Investment Management LLC (2005-2023, including prior positions); Director and Chairman, John Hancock Variable Trust Advisers LLC (2006-2023, including prior positions); Director and Chairman, John Hancock Investment Management Distributors LLC (2004-2023, including prior positions); President of various trusts within the John Hancock Fund Complex (2007-2023, including prior positions). Trustee of various trusts within the John Hancock Fund Complex (since 2017). |
Principal officers who are not Trustees | |
Name, year of birth Position(s) held with fund Principal occupation(s) during past 5 years | Current Position(s) with the Trust since |
Charles A. Rizzo, Born: 1957 | 2023 |
Chief Financial Officer | |
Vice President, John Hancock Financial Services (since 2008); Senior Vice President, John Hancock Investment Management LLC and John Hancock Variable Trust Advisers LLC (since 2008); Chief Financial Officer of various trusts within the John Hancock Fund Complex (since 2007). |
32 | MANULIFE PRIVATE CREDIT PLUS FUND | ANNUAL REPORT |
Principal officers who are not Trustees (continued) | |
Name, year of birth Position(s) held with fund Principal occupation(s) during past 5 years | Current Position(s) with the Trust since |
Salvatore Schiavone, Born: 1965 | 2023 |
Treasurer | |
Assistant Vice President, John Hancock Financial Services (since 2007); Vice President, John Hancock Investment Management LLC and John Hancock Variable Trust Advisers LLC (since 2007); Treasurer of various trusts within the John Hancock Fund Complex (since 2007, including prior positions). | |
Christopher (Kit) Sechler, Born: 1973 | 2023 |
Secretary and Chief Legal Officer | |
Vice President and Deputy Chief Counsel, John Hancock Investment Management (since 2015); Assistant Vice President and Senior Counsel (2009–2015), John Hancock Investment Management; Assistant Secretary of John Hancock Investment Management LLC and John Hancock Variable Trust Advisers LLC (since 2009); Chief Legal Officer and Secretary of various trusts within the John Hancock Fund Complex (since 2009, including prior positions). | |
Trevor Swanberg, Born: 1979 | 2023 |
Chief Compliance Officer | |
Chief Compliance Officer, John Hancock Investment Management LLC and John Hancock Variable Trust Advisers LLC (since 2020); Deputy Chief Compliance Officer, John Hancock Investment Management LLC and John Hancock Variable Trust Advisers LLC (2019–2020); Assistant Chief Compliance Officer, John Hancock Investment Management LLC and John Hancock Variable Trust Advisers LLC (2016–2019); Vice President, State Street Global Advisors (2015–2016); Chief Compliance Officer of various trusts within the John Hancock Fund Complex (since 2016, including prior positions). |
1 | Each Trustee holds office until his or her successor is duly elected and qualified, or until the Trustee’s death, retirement, resignation, or removal. |
2 | Member of the Audit Committee as of September 26, 2023. |
3 | Member of the Audit Committee. |
4 | The Trustee is a Non-Independent Trustee due to current or former positions with the Advisor and certain affiliates. |
ANNUAL REPORT | MANULIFE PRIVATE CREDIT PLUS FUND | 33 |
Andrew G. Arnott†
William H. Cunningham*
Grace K. Fey*
President
Chief Financial Officer
Treasurer
Secretary and Chief Legal Officer
Chief Compliance Officer
Eric Menzer, CFA, CAIA, AIF
Jeffrey Kan, CFA
Michael J. Comer, CFA
Principal distributor
You can also contact us: | ||
800-225-6020 | Regular mail: | Express mail: |
SS&C GIDS, Inc. 80 Lamberton Road Windsor, Connecticut 06095 | SS&C GIDS, Inc. 80 Lamberton Road Windsor, Connecticut 06095 |
34 | MANULIFE PRIVATE CREDIT PLUS FUND | ANNUAL REPORT |
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12/23 |
ITEM 2. CODE OF ETHICS.
As of the end of the period, December 31, 2023, the registrant has adopted a code of ethics, as defined in Item 2 of Form N-CSR, that applies to its Chief Executive Officer, Chief Financial Officer and Treasurer (respectively, the principal executive officer, the principal financial officer and the principal accounting officer, the "Covered Officers"). A copy of the code of ethics is filed as an exhibit to this Form N-CSR.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
Grace K. Fey is the audit committee financial expert and is "independent", pursuant to general instructions on Form N-CSR Item 3.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
(a) Audit Fees
The aggregate fees billed for professional services rendered by the principal accountant(s) for Manulife Private Credit Plus Fund for the audit of the registrant's annual financial statements or services that are normally provided by the accountant(s) in connection with statutory and regulatory filings or engagements amounted to $27,000 for the period from October 16, 2023 (commencement of operations) to December 31, 2023. These fees were billed to the registrant and were approved by the registrant's audit committee.
(b) Audit-Related Services
The aggregate fees for Manulife Private Credit Plus Fund for audit-related fees amounted to $5,000 for the period from October 16, 2023 (commencement of operations) to December 31, 2023. The nature of the services comprising the audit-related fees was the review of the registrant's registration statement. These fees were billed to the registrant or to the registrant's investment adviser (not including any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser), and any entity controlling, controlled by, or under common control with the adviser that provides ongoing services to the registrant ("control affiliates").
(c) Tax Fees
The aggregate fees for Manulife Private Credit Plus Fund billed for professional services rendered by the principal accountant(s) for the tax compliance, tax advice and tax planning ("tax fees") amounted to $15,750 for the period from October 16, 2023 (commencement of operations) to December 31, 2023. The nature of the services comprising the tax fees was the review of the registrant's tax returns and tax distribution requirements. These fees were billed to the registrant and were approved by the registrant's audit committee.
(d) All Other Fees
All other fees for Manulife Private Credit Plus Fund billed to the registrant or control affiliates for products and services provided by the principal accountant were $0 for the fiscal year ended December 31, 2023.
(e)(1) Audit Committee Pre-Approval Policies and Procedures:
The trust's Audit Committee must pre-approve all audit and non-audit services provided by the independent registered public accounting firm (the "Auditor") relating to the operations or financial reporting of the funds. Prior to the commencement of any audit or non-audit services to a fund, the Audit Committee reviews the services to determine whether they are appropriate and permissible under applicable law.
The trust's Audit Committee has adopted policies and procedures to, among other purposes, provide a framework for the Committee's consideration of audit-related and non-audit services by
the Auditor. The policies and procedures require that any audit-related and non-audit service provided by the Auditor and any non-audit service provided by the Auditor to a fund service provider that relates directly to the operations and financial reporting of a fund are subject to approval by the Audit Committee before such service is provided. Audit-related services provided by the Auditor that are expected to exceed $25,000 per instance/per fund are subject to specific pre-approval by the Audit Committee. Tax services provided by the Auditor that are expected to exceed $30,000 per instance/per fund are subject to specific pre-approval by the Audit Committee.
All audit services, as well as the audit-related and non-audit services that are expected to exceed the amounts stated above, must be approved in advance of provision of the service by formal resolution of the Audit Committee. At the regularly scheduled Audit Committee meetings, the Committee reviews a report summarizing the services, including fees, provided by the Auditor.
(e)(2) Services approved pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X: Audit-Related Fees, Tax Fees and All Other Fees:
There were no amounts that were approved by the Audit Committee pursuant to the de minimis exception under Rule 2-01 of Regulation S-X.
(f)According to the registrant's principal accountant, for the fiscal year ended December 31,
2023, the percentage of hours spent on the audit of the registrant's financial statements for the most recent fiscal year that were attributed to work performed by persons who were not full-time, permanent employees of principal accountant was less than 50%.
(g)The aggregate non-audit fees billed by the registrant's accountant(s) for services rendered to the registrant and rendered to the registrant's control affiliates for the last fiscal year of the registrant were $3,079,277 for the fiscal year ended December 31, 2023.
(h)The audit committee of the registrant has considered the non-audit services provided by the registrant's principal accountant(s) to the control affiliates and has determined that the services that were not pre-approved are compatible with maintaining the principal accountant(s)' independence.
(i)Not applicable.
(j)Not applicable.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS
The registrant has a separately-designated standing audit committee comprised of independent trustees. The members of the audit committee are as follows:
Grace K. Fey – Chairperson
William H. Cunningham
Hassell H. McClellan
ITEM 6. SCHEDULE OF INVESTMENTS.
(a)Not applicable.
(b)Not applicable.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED- END MANAGEMENT INVESTMENT COMPANIES.
See attached exhibit "Proxy Voting Policies and Procedures"
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Information about the Manulife Investment Management (US) LLC portfolio managers who share joint responsibility for the day-to-day investment management of Manulife Private Credit Plus Fund is below. It provides a brief summary of their business careers over the past five years. Information is provided as of the filing date of this N-CSR.
Nathan W. Thooft, CFA
Chief Investment Officer, Senior Portfolio Manager
Managed the fund since 2023
Joined Manulife IM (US) in 2008
Eric Menzer, CFA, CAIA, AIF
Head of Advisory Solutions and Senior Portfolio Manager, Multi-Asset Solutions Team Managed the fund since 2023
Joined Manulife IM (US) in 2006
Jeffrey Kan, CFA
Senior Portfolio Manager, Multi-Asset Solutions Team
Began Investment Career: 2004
Managed the fund since 2023
Joined Manulife IM (US) in 2021
Michael J. Comer, CFA
Portfolio Manager, Multi-Asset Solutions Team
Managed the fund since 2023
Joined Manulife IM (US) in 2010
Other Accounts the Portfolio Managers are Managing
The table below indicates, for each portfolio manager, information about the other accounts over which the portfolio manager has day-to-day investment responsibility. All information on the number of accounts and total assets in the table is as of December 31, 2023. For purposes of the table, "Other Pooled Investment Vehicles" may include investment partnerships and group trusts, and "Other Accounts" may include separate accounts for institutions or individuals, insurance company general or separate accounts, pension funds and other similar institutional accounts.
| Registered |
| Other Pooled | Other Accounts | ||
| Investment Companies | Investment Vehicles |
|
| ||
Portfolio Manager | Number of | Total | Number of | Total | Number of | Total |
| Accounts | Assets | Accounts | Assets | Accounts | Assets |
|
| $Million |
| $Million |
| $Million |
Nathan W. Thooft | 63 | 72,647 | 47 | 15,586 | 0 | 0 |
Eric Menzer | 0 | 0 | 5 | 320 | 14 | 3,992 |
Jeffrey Kan | 0 | 0 | 3 | 26 | 0 | 0 |
Michael J. Comer | 2 | 8,095 | 4 | 329 | 0 | 0 |
Accounts within the total accounts that are subject to a performance-based advisory fee: 0.
Conflicts of Interest. Material conflicts of interest exist whenever a portfolio manager simultaneously manages multiple accounts. A conflict of interest may arise as a result of the portfolio manager being responsible for multiple accounts, including the fund, which may have different investment guidelines and objectives. In addition to the fund, these accounts may include accounts of other registered investment companies for which the Subadvisor serves as sub-advisor, private pooled investment vehicles and other accounts. The Subadvisor has adopted
aggregation and allocation of investments procedures designed to ensure that all of its clients are treated fairly and equitably over time and to prevent this form of conflict from influencing the allocation of investment opportunities among its clients. As a general matter, the Subadvisor will offer clients the right to participate in all investment opportunities that it determines are appropriate for the client in view of relative amounts of capital available for new investments, each client's investment program, and the then current portfolios of its clients at the time an allocation decision is made. As a result, in certain situations priority or weighted allocations can be expected to occur in respect of certain accounts, including but not limited to situations where clients have differing: (A) portfolio concentrations with respect to geography, asset class, issuer, sector or rating, (B) investment restrictions, (C) tax or regulatory limitations, (D) leverage limitations or volatility targets, (E) ramp up or ramp down scenarios or (F) counterparty relationships. The Subadvisor maintains conflicts of interest policies and procedures containing provisions designed to prevent potential conflicts related to personal trading, allocation, and fees among other potential conflicts of interest. Such potential conflicts and others are disclosed in Subadvisor's Form ADV Part 2A filing.
Compensation of Portfolio Managers. The Subadvisor has adopted a system of compensation for portfolio managers and others involved in the investment process that is applied systematically among investment professionals. At the Subadvisor, the structure of compensation of investment professionals is currently comprised of the following basic components: base salary and short- and long-term incentives. The following describes each component of the compensation package for the individuals identified as a portfolio manager for the fund.
•Base salary. Base compensation is fixed and normally reevaluated on an annual basis. The Subadvisor seeks to set compensation at market rates, taking into account the experience and responsibilities of the investment professional.
•Incentives. Only investment professionals are eligible to participate in the short- and long- term incentive plan. Under the plan, investment professionals are eligible for an annual cash award. The plan is intended to provide a competitive level of annual bonus compensation that is tied to the investment professional achieving superior investment performance and aligns the financial incentives of the Subadvisor and the investment professional. Any bonus under the plan is completely discretionary, with a maximum annual bonus that may be well in excess of base salary. Payout of a portion of this bonus may be deferred for up to five years. While the amount of any bonus is discretionary, the following factors are generally used in determining bonuses under the plan:
oInvestment Performance: The investment performance of all accounts managed by the investment professional over one, three and five-year periods are considered. The pre-tax performance of each account is measured relative to an appropriate peer group benchmark identified in the table below (for example a Morningstar large cap growth peer group if the fund invests primarily in large cap stocks with a growth strategy). With respect to fixed income accounts, relative yields are also used to measure performance. This is the most heavily weighted factor.
oFinancial Performance: The profitability of the Subadvisor and its parent company are also considered in determining bonus awards.
oNon-Investment Performance: To a lesser extent, intangible contributions, including the investment professional's support of client service and sales activities, new fund/strategy idea generation, professional growth and development, and management, where applicable, are also evaluated when determining bonus awards.
oIn addition to the above, compensation may also include a revenue component for an investment team derived from a number of factors including, but not limited
to, client assets under management, investment performance, and firm metrics.
•Manulife equity awards. A limited number of senior investment professionals may receive options to purchase shares of Manulife Financial stock. Generally, such option would permit the investment professional to purchase a set amount of stock at the market price on the date of grant. The option can be exercised for a set period (normally a number of years or until termination of employment) and the investment professional would exercise the option if the market value of Manulife Financial stock increases. Some investment professionals may receive restricted stock grants, where the investment professional is entitled to receive the stock at no or nominal cost, provided that the stock is forgone if the investment professional's employment is terminated prior to a vesting date.
•Deferred Incentives. Investment professionals may receive deferred incentives which are fully invested in strategies managed by the team/individual as well as other Manulife Investment Management strategies.
The Subadvisor also permits investment professionals to participate on a voluntary basis in a deferred compensation plan, under which the investment professional may elect on an annual basis to defer receipt of a portion of their compensation until retirement.
Participation in the plan is voluntary.
Share Ownership by Portfolio Managers. The following table indicates as of December 31, 2023, the value of shares beneficially owned by the portfolio managers in the Fund.
Portfolio Manager | Range of Beneficial Ownership |
Nathan W. Thooft | $0 |
Eric Menzer | $0 |
Jeffrey Kan | $0 |
Michael J. Comer | $0 |
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND AFFILIATED PURCHASERS
(a)Not applicable.
(b)Not applicable.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
(a)The registrant has adopted procedures by which shareholders may recommend nominees to the registrant's Board of Trustees. A copy of the procedures is filed as an exhibit to this Form N-CSR. See attached "Manulife Private Credit Plus Fund – Nominating and Governance Committee Charter".
ITEM 11. CONTROLS AND PROCEDURES.
(a)Based upon their evaluation of the registrant's disclosure controls and procedures as conducted within 90 days of the filing date of this Form N-CSR, the registrant's principal executive officer and principal financial officer have concluded that those disclosure controls and procedures provide reasonable assurance that the material information required to be disclosed by the registrant on this report is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms.
(b)There were no changes in the registrant's internal control over financial reporting that occurred during the period covered by this report that have materially affected, or are reasonably likely to materially affect, the registrant's internal control over financial reporting.
ITEM 12. DISCLOSURE OF SECURITIES LENDING ACTIVITIES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not Applicable.
ITEM 13. EXHIBITS.
(a)(1) Code of Ethics for Covered Officers is attached.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Manulife Private Credit Plus Fund
By: | /s/ Andrew G. Arnott |
| ------------------------------ |
| Andrew G. Arnott |
| President |
Date: | February 28, 2024 |
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
By: | /s/ Andrew G. Arnott |
| ------------------------------ |
| Andrew G. Arnott |
| President |
Date: | February 28, 2024 |
By: | /s/ Charles A. Rizzo |
| -------------------------------- |
| Charles A. Rizzo |
| Chief Financial Officer |
Date: | February 28, 2024 |