Crescent Capital BDC, Inc.

Current report

The current United States administration has threatened or imposed tariffs on certain imports from a number of countries, including China. Tariffs and international trade arrangements may continue to change, potentially without warning and to an extent that is difficult to predict. Existing or new tariffs imposed on foreign goods imported by the United States or on U.S. goods imported by foreign countries could subject us or our portfolio companies to additional risks. Among other effects, tariffs may increase the cost of production for certain or our portfolio companies or reduce demand for their products, which could affect the results of their operations, and may cause a general economic slowdown or recession. We cannot predict whether, or to what extent, any tariff or other trade protections may affect us, our portfolio companies or the economy.

Current report

Many of our portfolio companies may be susceptible to economic slowdowns or recessions and may be unable to repay our loans during these periods. Therefore, our non-performing assets may increase and the value of our portfolio may decrease during these periods as we are required to record the values of our investments. Adverse economic conditions also may decrease the value of collateral securing our loans. Economic slowdowns or recessions could lead to financial losses in our portfolio and a decrease in revenues, net income and assets. Unfavorable economic conditions also could increase our funding costs, limit our access to the capital markets or result in a decision by lenders not to extend credit to us. These events could prevent us from increasing investments and harm our operating results.

Current report

A portfolio company’s failure to satisfy financial or operating covenants imposed by us or other lenders could lead to defaults and, potentially, termination of its loans and foreclosure on its secured assets, which could trigger cross-defaults under other agreements and jeopardize our portfolio company’s ability to meet its obligations under the debt securities that we hold. We may incur expenses to the extent necessary to seek recovery upon default or to negotiate new terms with a defaulting portfolio company. In addition, if one of our portfolio companies were to go bankrupt, even though we or one of our affiliates may have structured our interest in such portfolio company as senior debt, depending on the facts and circumstances, including the extent to which we actually provided managerial assistance to that portfolio company, a bankruptcy court might re-characterize our debt holding as equity and subordinate all or a portion of our claim to claims of other creditors.

Current report

Efforts by the Federal Reserve and other central banks globally to combat inflation and restore price stability, as well as other global events, may raise the prospect or severity of a recession. Wars have added, and other international tensions or escalations of conflict may add, instability to the uncertainty driving socioeconomic forces, which may continue to have an impact on global trade and result in inflation or economic instability. Present conditions and the state of the U.S. and global economies make it difficult to predict whether and/or to what extent a recession will occur in the near future.

Current report

Any such recession would negatively impact the businesses in which we invest and our business. These impacts may include:

Current report

severe declines in the market price of our securities or net asset value;

Current report

inability of the Company to accurately or reliably value its portfolio;

Current report

inability of the Company to comply with certain asset coverage ratios that would prevent the Company from paying dividends to shareholders and that could result breaches of covenants or events of default under our credit arrangements;

Current report

inability of the Company to pay any dividends and distributions or service its debt;

Current report

declines in the value of our investments;

Current report

increased risk of default or bankruptcy by the companies in which we invest;

Current report

increased risk of companies in which we invest being unable to weather an extended cessation of normal economic activity and thereby impairing their ability to continue functioning as a going concern;

Current report

limited availability of new investment opportunities;

Current report

inability for us to replace our existing leverage when it becomes due or replace it on terms as favorable as our existing leverage; and

Current report

general threats to the Company’s ability to continue investment operations and to operate successfully as a BDC.

Current report

None.

Previous report

In connection with the Merger Agreement, Sun Life, which owns a majority interest in the Adviser, committed to provide secondary market support and will over time purchase $20.0 million of the Company’s common stock via a share purchase program. The Sun Life purchase program, which re-commenced on June 24, 2024 and concluded on July 19, 2024, purchased 382,542 shares of our common stock totaling $7.4 million during the quarter ended September 30, 2024, for total purchases of the full $20.0 million under the share purchase program. Purchases of our common stock pursuant to the Sun Life purchase program are subject to certain conditions as set forth in the program and are conducted in accordance with Rules 10b5- 1 and 10b-18 under the Exchange Act and other applicable securities laws and regulations that set certain restrictions on the method, timing, price, and volume of stock purchases.