Company: PDCC
Filing Date: 2025-07-18
Form Type: N-2
Source: 0001214659-25-010613
Chunk: 210

Company: Pearl Diver Credit Co Inc.
Filing Date: 2025-07-18
Form: N-2
Chunk 210
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, the writer is
obligated to complete the transaction in the underlying currency. An option generally becomes worthless to the holder when it expires.
In addition, in the context of an exchange-traded option, the writer is often required to deposit initial margin and may be required to
increase the margin on deposit if the market moves against the writer’s position. Options on currencies may be purchased in the
OTC market between commercial entities dealing directly with each other as principals. In purchasing an OTC currency option, the holder
is subject to the risk of default by the writer and, for this reason, purchasers of options on currencies may require writers to post
collateral or other forms of performance assurance.

Buyers and sellers of currency
futures contracts are subject to the same risks that apply to the use of futures contracts generally, which are described elsewhere in
this SAI. Further, settlement of a currency futures contract for the purchase of most currencies must occur at a bank based in the issuing
nation, which may subject the Company to additional risk.

Risks. Currency transactions
are subject to risks that are different from those of other portfolio transactions. Currency exchange rates may fluctuate based on factors
extrinsic to that country's economy. Although forward foreign currency contracts and currency futures tend to minimize the risk of loss
due to a decline in the value of the hedged currency, at the same time they may limit any potential gain which might result should the
value of such currency increase. Because currency control is of great importance to the issuing governments and influences economic planning
and policy, purchase and sales of currency and related instruments can be negatively affected by government exchange controls, blockages,
and manipulations or exchange restrictions imposed by governments. These can result in losses to the Company if it is unable to deliver
or receive currency or funds in the settlement of obligations and could also cause hedges it has entered into to be rendered useless,
resulting in full currency exposure as well as incurring transaction costs. Buyers and sellers of currency futures are subject to the
same risks that apply to the use of futures generally. Further, settlement of a currency futures contract for the purchase of most currencies
must occur at a bank based in the issuing nation. The ability to establish and close out positions on currency futures contracts is subject
to the maintenance of a liquid market, which may not always be available.

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The Company may take active
positions in currencies, which involve different techniques and risk analyses than the Company’s purchase of securities.