Company: PDCC
Filing Date: 2025-07-18
Form Type: N-2
Source: 0001214659-25-010613
Chunk: 142

Company: Pearl Diver Credit Co Inc.
Filing Date: 2025-07-18
Form: N-2
Chunk 142
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 financial model contains detailed information
on the characteristics of CLOs, including recent information about assets and liabilities, and is used to project future cashflows. Key
inputs to the model, including assumptions for future loan default rates, recovery rates, prepayment rates, reinvestment rates, and discount
rates are determined by considering both observable and third-party market data and prevailing general market assumptions and conventions
as well as those of the Adviser.

Specifically, we utilize a third-party pricing
service in connection with the valuation of our investments in CLO debt. However, if pricing from such third-party pricing service is
determined to be stale or otherwise not reflective of current market conditions, we may use an average of independent broker quotes to
determine fair value. We engage a third-party independent valuation firm as an input to the Company’s valuation of the fair value
of its investments in CLO equity. The valuation firm’s advice is only one factor considered in the valuation of such investments,
and the board of directors does not rely on such advice in determining the fair value of our investments in accordance with the 1940 Act.

Our investment portfolio is valued at least each
quarter, in accordance with the Adviser’s valuation policies and procedures. Fair valuations are ultimately determined by the Adviser’s
valuation committee, which comprises a majority of non-investment personnel. Our board of directors oversees the valuation designee and
the process that it uses to determine the fair value of our assets. In this regard, our board of directors receives periodic and, as applicable,
prompt reporting regarding certain material valuation matters, as required by Rule 2a-5 under the 1940 Act.

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<div align='center'>DISTRIBUTION POLICY</div>

Regular Distributions

We intend to make regular monthly cash distributions
of all or a portion of our investment company taxable income to holders of our common stock. We also intend to make at least annual distributions
of all or a portion of our “net capital gains” (which is the excess of net long-term capital gains over net short-term capital
losses) as described below. Any dividends to our holders of our common stock will be declared out of assets legally available for distribution.

While we anticipate a portion of such distributions,
if made, to be paid from income primarily generated by interest income earned on our investment portfolio, and a portion of such distributions
may also comprise a return of capital. A return of capital will lower a shareholder’s tax basis in his or