CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This report contains forward-looking statements that involve substantial risks and uncertainties. Such statements involve known and unknown risks, uncertainties and other factors and undue reliance should not be placed thereon. These forward-looking statements are not historical facts, but rather are based on current expectations, estimates and projections about Crescent Private Credit Income Corp (together, with its consolidated subsidiaries, the “Company," “we” or “our”), our current and prospective portfolio investments, our industry, our beliefs and opinions, and our assumptions. Words such as “anticipates,” “expects,” “intends,” “plans,” “will,” “may,” “continue,” “believes,” “seeks,” “estimates,” “would,” “could,” “should,” “targets,” “projects,” “outlook,” “potential,” “predicts” and variations of these words and similar expressions are intended to identify forward-looking statements. These statements are not guarantees of future performance and are subject to risks, uncertainties and other factors, some of which are beyond our control and difficult to predict and could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements, including without limitation:
the ability of our investment adviser to locate suitable investments for us and to monitor and administer our investments;
regulations governing our operation as a business development company;
financing investments with borrowed money;
operation in a highly competitive market for investment opportunities;
our ability to successfully complete and integrate any acquisitions;
risks associated with original issue discount (“OID”) and payment-in-kind (“PIK”) interest income;
changes in interest rates may affect our cost of capital and net investment income;
the impact of changes in Secured Overnight Financing Rate (“SOFR”), or other benchmark rates on our operating results;
uncertainty as to the value of certain portfolio investments;
our ability to deploy any capital raised in sales of our Common Shares;
lack of liquidity in investments;
the impact of changes in laws or regulations (including the interpretation thereof), including tax laws, governing our operations or the operations of our portfolio companies;
the ensuing conflict in the Middle East;
the timing, form and amount of any dividend distributions;
risks regarding distributions;
potential resignation of the Adviser and/or the Administrator;
potential adverse effects of price declines and illiquidity in the corporate debt markets;
potential impact of economic recessions or downturns;
defaults by portfolio companies;
the outcome and impact of any litigation;
uncertainty surrounding the financial stability of the United States, Europe and China;
adverse developments in the credit markets; and
potential fluctuation in quarterly operating results.
Although we believe that the assumptions on which these forward-looking statements are based upon are reasonable, some of those assumptions may be based on the work of third parties and any of those assumptions could prove to be inaccurate; as a result, forward-looking statements based on those assumptions also could prove to be inaccurate. In light of these and other uncertainties, the inclusion of a projection or forward-looking statement in this Annual Report and should not be regarded as a representation by us that our plans and objectives will be achieved. You should not place undue reliance on these forward-looking statements, which apply only as of the date of this Annual Report or other information incorporated herein by reference, as applicable. We do not undertake any obligation to update or revise any forward-looking statements or any other information contained herein, except as required by applicable law. You are advised to consult any additional disclosures that we may make directly to you or through reports that we in the future may file with the SEC, including registration statements on Form N-2, annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K. The safe harbor provisions of Section 21E of the Securities Exchange Act of 1934 (the “Exchange Act”), which preclude civil liability for certain forward-looking statements, do not apply to the forward-looking statements in this report because we are an investment company.
SUMMARY OF RISK FACTORS
The following is only a summary of the principal risks that may materially adversely affect our business, financial condition, results of operations and cash flows. The following should be read in conjunction with the more complete discussion of the risk factors we face, which are set forth in the section titled “Item 1A. Risk Factors” in this report.
Risks Related to Our Business and Structure
We have a limited operating history and our Board of Directors (the "Board") may change our investment objectives, operating policies and strategies without prior notice or stockholder approval.
We and our investment adviser are subject to regulations and U.S. Securities and Exchange Commission (the “SEC”) oversight and any failures to comply with applicable requirements may adversely impact our results.
We are a non-diversified investment company within the meaning of the Investment Company Act of 1940, as amended (the “Investment Company Act”); therefore we are not limited with respect to the proportion of our assets that may be invested in securities of a single issuer.
We are dependent on Crescent and upon key personnel of Crescent and our investment adviser.
We may not replicate the historical performance achieved by Crescent.
We, our investment adviser, the investment committee of our investment adviser, Crescent and their affiliates, officers, directors and employees may face certain conflicts of interest, including those that may impact our ability to make new investments and our existing investments.
Crescent’s principals and employees, our investment adviser or their affiliates may, from time to time, possess material non-public information, limiting our investment discretion.
Our management and incentive fee structure may create incentives for our investment adviser that are not fully aligned with our common stockholders’ interests and may induce our investment adviser to make speculative investments.
Our investment adviser has limited liability and is entitled to indemnification under the Investment Advisory and Management Agreement.
Our ability to enter into new transactions and to exit existing investments with our affiliates is restricted.
We operate in an increasingly competitive market for investment opportunities, which could make it difficult for us to identify and make investments that are consistent with our investment objectives.
Our ability to grow depends on our ability to raise capital.
Regulations governing our operation as a business development company (“BDC”) affect our ability to, and the way in which we may, raise additional capital and any failure to maintain BDC status may significantly impact us.
Our business may be adversely affected if we fail to maintain our qualification as a registered investment company (a "RIC").
Our failure to make follow-on investments in our portfolio companies could impair the value of our portfolio.
We may retain income and capital gains in excess of what is permissible for excise tax purposes and such amounts will be subject to 4% U.S. federal excise tax, reducing the amount available for distribution to stockholders; additionally, we may be subject to withholding of US Federal income tax on distributions for non-U.S. stockholders.
We may have difficulty paying our required distributions if we recognize income before, or without, receiving cash representing such income.
Our investments in OID and PIK interest income may expose us to risks associated with such income being required to be included in accounting income and taxable income prior to receipt of cash.
We are and may be subject to restrictions under our credit facilities and any future credit or other borrowing facility that could adversely impact our business.
Our strategy involves a high degree of leverage. We intend to continue to finance our investments with borrowed money, which will magnify the potential for gain or loss on amounts invested and increase the risk of investing in us.
We are exposed to risks associated with changes in interest rates.
We may be the target of litigation.
Most of our portfolio investments will not be publicly traded and, as a result, the fair value of these investments may not be readily determinable.
New or modified laws or regulations, including those governing taxes, tariffs, import/export regimes, our operations or the operations of our portfolio companies may adversely affect our business.
We are subject to risks related to corporate social responsibility.
The lack of liquidity in our investments may adversely affect our business, and if a significant investment fails to perform as expected we could be negatively impacted.