Company: PDCC
Filing Date: 2025-09-16
Form Type: N-2/A
Source: 0001214659-25-013826
Chunk: 170

Company: Pearl Diver Credit Co Inc.
Filing Date: 2025-09-16
Form: N-2/A
Chunk 170
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 available to certain
U.S. corporations under the Code as ineligible for such treatment, (iii) disallow, suspend or otherwise limit the allowance of certain
losses or deductions, (iv) convert long-term capital gains into short-term capital gains or ordinary income, (v) convert an ordinary loss
or deduction into a capital loss (the deductibility of which is more limited), (vi) cause us to recognize income or gain without a corresponding
receipt of cash, (vii) adversely alter the characterization of certain complex financial transactions, and (viii) produce income that
will not qualify as good income for purposes of the Qualifying Income Test. While we may not always be successful in doing so, we will
seek to avoid or minimize the adverse tax consequences of our investment practices.

We may recognize gain (but not loss) from a constructive
sale of certain “appreciated financial positions” if we enter into a short sale, offsetting notional principal contract, or
forward contract transaction with respect to the appreciated position or substantially identical property. Appreciated financial positions
subject to this constructive sale treatment include interests (including options and forward contracts and short sales) in stock and certain
other instruments. Constructive sale treatment does not apply if the transaction is closed out not later than thirty days after the end
of the tax year in which the transaction was initiated, and the underlying appreciated securities position is held unhedged for at least
the next sixty days after the hedging transaction is closed.

Gain or loss from a short sale of property is
generally considered as capital gain or loss to the extent the property used to close the short sale constitutes a capital asset in our
hands. Except with respect to certain situations where the property used to close a short sale has a long-term holding period on the date
the short sale is entered into, gain on short sales generally are short-term capital gains. A loss on a short sale will be treated as
a long-term capital loss if, on the date of the short sale, “substantially identical property” has been held by us for more
than one year. In addition, entering into a short sale may result in suspension of the holding period of “substantially identical
property” held by us.

Gain or loss on a short sale will generally not
be realized until such time as the short sale is closed. However, as described above in the discussion of constructive sales, if we hold
a short sale position with respect to securities that have