Company: PDCC
Filing Date: 2025-07-18
Form Type: N-2
Source: 0001214659-25-010613
Chunk: 44

Company: Pearl Diver Credit Co Inc.
Filing Date: 2025-07-18
Form: N-2
Chunk 44
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 manager to another entity. There can be no assurance that
any removal, replacement, resignation or assignment of any particular CLO manager’s role will not adversely affect the returns on
the CLO securities in which we intend to invest.

Our investments in CLO securities may be subject to special anti-deferral provisions that could result in us incurring tax or recognizing income prior to receiving cash distributions related to such income.

Some of the CLOs in which we invest may constitute
“passive foreign investment companies,” or “PFICs.” If we acquire interests treated as equity for U.S. federal
income tax purposes in PFICs (including equity tranche investments and certain debt tranche investments in CLOs that are PFICs), we may
be subject to federal income tax on a portion of any “excess distribution” or gain from the disposition of such shares even
if such income is distributed as a taxable dividend by us to our stockholders. Certain elections may be available to mitigate or eliminate
such tax on excess distributions, but such elections (if available) will generally require us to recognize our share of the PFIC’s
income for each tax year regardless of whether we receive any distributions from such PFIC. We must nonetheless distribute such income
to maintain our status as a RIC. We intend to treat our income inclusion with respect to a PFIC with respect to which we have made a qualified
electing fund, or “QEF,” election, as qualifying income for purposes of determining our ability to be subject to tax as a
RIC if (i) there is a current distribution out of the earnings and profits of the PFIC that are attributable to such income inclusion
or (ii) such inclusion is derived with respect to our business of investing in stock, securities, or currencies. As such, we may be restricted
in our ability to make QEF elections with respect to our holdings in issuers that could be treated as PFICs in order to ensure our continued
qualification as a RIC and/or maximize our after-tax return from these investments.

If we hold 10% or more of the interests treated
as equity (by vote or value) for U.S. federal income tax purposes in a foreign corporation that is treated as a controlled foreign corporation,
or “CFC” (including equity tranche investments and certain debt tranche investments in a CLO treated as a CFC), we may be
treated as receiving a deemed distribution (taxable as ordinary income) each tax