Company: TSI
Filing Date: 2025-12-18
Form Type: N-2/A
Source: 0001193125-25-324429
Chunk: 109

Company: TCW STRATEGIC INCOME FUND INC
Filing Date: 2025-12-18
Form: N-2/A
Chunk 109
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 these recoveries, an Underlying Fund cannot always control the ultimate timing of an amount recovered, and there is no assurance that an Underlying Fund’s investment adviser will be able to predict the timing of any such payments. For most investments made by an Underlying Fund, an Underlying Fund will not be the client of the law firm representing the party to the litigation or transaction and will not have the ability to control decisions made by the parties or the law firm. Lawyers are generally required to act pursuant to their clients’ directives and are fiduciaries to their clients, not to an Underlying Fund. The law firms involved also will be subject to an overriding duty to the courts and not an Underlying Fund. As part of the due diligence process in which an Underlying Fund engages, an Underlying Fund might rely on the advice and opinion of outside counsel and other experts in assessing potential opportunities. Further, an Underlying Fund and its investment adviser will sometimes be dependent upon the skills and efforts of independent law firms to complete any settlement or underlying litigation or transactional matter. There is no guarantee that the ultimate outcome of any opportunities will be in line with a law firm’s or expert’s initial assessment. 57 Merchant Cash Advance Risk For a variety of reasons, many small- and medium-sizedmerchants, retailers and businesses may have difficulties securing loans from traditional lenders and rely on merchant cash advances for operating liquidity. Merchant cash advances are made largely based on factors such as the value of a business’ account receivables. In exchange, the provider of the advance may receive a share of a business’ future sales and/ or a fixed fee. The remittances from the borrower will generally be drawn from the borrower’s customer debit- and credit-card purchases until the advance is repaid. Such cash advances come with the additional risks associated with small business lending which may lead to losses to an Underlying Fund. Since the cash advances are technically sales of future assets, rather than direct loans or credit, when making such advances an Underlying Fund is not believed to be currently subject to state usury laws or any of the restrictions under the Dodd-Frank Wall Street Reform and Consumer Protection Act. However, there have been discussions of increasing regulation of merchant cash advances and other alternative lending. Any such increased regulation may have an adverse effect on an Underlying Fund by increasing the cost of executing merchant cash advances, or making the strategy economically unfeasible or unlawful. There have also been claims that certain merchant cash advances should be re-characterizedas loans. Any such