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H.S. senior Avg
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New words:
accordion, agency, cutting, dry, effort, eventually, exercise, half, indenture, institutional, joinder, NCPCF, NCPCIF, Notwithstanding, powder, securitization, temporarily
Removed:
anticipate, blue, entitling, Indemnified, language, misconduct, negligence, operational, ramp, regulator, relation, removed, replace, responsibility, revised, sky, sourcing, sunset, termination
Financial report summary
?Risks
- The Fund has limited operating history.
- Our Board may change our investment objective, operating policies and strategies without prior notice or shareholder approval, the effects of which may be adverse.
- Our Board may amend our Declaration of Trust without prior shareholder approval.
- Price declines and illiquidity in the corporate debt markets may adversely affect the fair value of our portfolio investments, reducing our NAV through increased net unrealized depreciation.
- Our financial condition and results of operations depend on our ability to manage our business effectively.
- Churchill may not be able to achieve the same or similar returns as those achieved by our senior management and investment personnel while they were employed at prior positions.
- We operate in a highly competitive market for investment opportunities, which could reduce returns and result in losses.
- Many of our portfolio investments will be recorded at fair value as determined in good faith by the Adviser, as the valuation designee, subject to the oversight of the Board, and, as a result, there may be uncertainty as to the value of our portfolio investments.
- We may not be able to pay distributions, our distributions may not grow over time and/or a portion of our distributions may be a return of capital.
- The amount of any distributions we may make is uncertain. Our distributions may exceed our earnings, particularly during the period before we have substantially invested the net proceeds from our public offering. Therefore, portions of the distributions that we make may represent a return of capital to you that will lower your adjusted tax basis in your Common Shares and reduce the amount of funds we have for investment in targeted assets.
- We have not established any limit on the amount of funds we may use from certain available sources, such as proceeds from this offering, to fund distributions (which may reduce the amount of capital we ultimately invest in assets).
- Although we have implemented a share repurchase program, we have discretion to not repurchase your shares or to suspend the program.
- The timing of our repurchase offers pursuant to our share repurchase program may be at a time that is disadvantageous to our shareholders.
- There are significant financial and other resources necessary to comply with the requirements of being an SEC reporting entity.
- We may experience fluctuations in our quarterly operating results.
- We are an “emerging growth company” under the JOBS Act, and we cannot be certain if the reduced disclosure requirements applicable to emerging growth companies will make our Common Shares less attractive to investors.
- Any unrealized losses we experience on our portfolio may be an indication of future realized losses, which could reduce our income available for distribution.
- Terrorist attacks, acts of war, global health emergencies or natural disasters may affect any market for our Common Shares, impact the businesses in which we invest and harm our business, operating results and financial condition.
- We are currently operating in a period of significant market disruption and economic uncertainty, which may have a negative impact on our business, financial condition and operations. An extended disruption in the capital markets and the credit markets could negatively affect our business.
- The failure of cybersecurity protection systems, as well as the occurrence of events unanticipated in our disaster recovery systems and management continuity planning, could impair our ability to conduct business effectively.
- Our business is dependent on bank relationships and recent strain on the banking system may adversely impact us.
- We may not be able to obtain all required state licenses.
- Global economic, political and market conditions, including BREXIT, may adversely affect our business or cause us to alter our business strategy.
- Compliance with the SEC’s Regulation Best Interest may negatively impact our ability to raise capital in our offering, which would harm our ability to achieve our investment objective.
- We typically invest in middle-market, privately owned companies, which may present a greater risk of loss than loans to larger companies.
- We are subject to risks associated with our Senior Loan Investments.
- We are subject to risks associated with our Junior Capital Investments.
- We are subject to risks associated with “covenant-lite” loans.
- We are subject to risks associated with our investments in unitranche secured loans and securities.
- We are subject to risks associated with our investments in equity-related securities.
- The loans we make in portfolio companies may become nonperforming.
- The lack of liquidity in our investments may adversely affect our business.
- Our portfolio companies may prepay loans, which may reduce stated yields if capital returned cannot be invested in transactions with equal or greater expected yields.
- We may be subject to risks associated with our investments in the business services industry.
- We are exposed to risks associated with any OID income and PIK interest required to be included in taxable and accounting income prior to receipt of cash representing such income.
- We may hold the debt securities of leveraged companies that may, due to the significant volatility of such companies, enter into bankruptcy proceedings.
- Our failure to make follow-on investments in our portfolio companies could impair the value of our portfolio.
- We may not be able to exercise control over our portfolio companies or to prevent decisions by management of our portfolio companies, which could decrease the value of our investments.
- Defaults by our portfolio companies will harm our operating results.
- Our portfolio companies may incur debt that ranks equally with, or senior to, the loans and other investments we make in such portfolio companies.
- We are subject to risks associated with syndicated loans.
- We are subject to risks associated with our investments in special situation companies.
- We may enter into repurchase agreements.
- The disposition of our investments in private companies may result in contingent liabilities.
- We may not realize gains from our equity investments.
- Inflation may adversely affect the business, results of operations and financial condition of our portfolio companies, which may, in turn, impact the valuation of such portfolio companies.
- We are exposed to risks associated with changes in interest rates.
- The alternative reference rates that have replaced LIBOR in our credit arrangements and other financial instruments may not yield the same or similar economic results as LIBOR over the life of such transactions.
- Our ability to enter into transactions involving derivatives and unfunded commitment transactions may be limited.
- We may incur lender liability as a result of our lending activities.
- We may incur liability as a result of providing managerial assistance to our portfolio companies.
- Economic recessions or downturns could impair our portfolio companies and harm our operating results.
- Environmental, social and governance factors may adversely affect our business or cause us to alter our business strategy.
- The effect of global climate change may impact the operations and valuation of our portfolio companies.
- We depend upon the senior management of Churchill for our success, and upon the strong referral relationships of the investment professionals of Churchill, Nuveen, Nuveen Leveraged Finance and its affiliates with financial institutions. Any inability to maintain or develop these relationships, or the failure of these relationships to generate investment opportunities, could adversely affect our business.
- Our access to confidential information may restrict our ability to take action with respect to some of our investments, which, in turn, may negatively affect our results of operations.
- We may be obligated to pay the Adviser incentive compensation even if we incur a net loss due to a decline in the value of our portfolio.
- There may be conflicts related to obligations that senior investment professionals of Churchill and members of its investment committee have to other clients. There also may be conflicts related to the investment and related activities of TIAA, Nuveen and Churchill, and these conflicts could prevent us from making or disposing of certain investments on the terms desired.
- The time and resources that individuals employed by the Adviser devote to us may be diverted and we may face additional competition because individuals employed by the Adviser are not prohibited from raising money for or managing other entities that make the same types of investments that we target.
- Our ability to enter into transactions with our affiliates is restricted, which may limit the scope of investments available to us.
- The Adviser and Nuveen Asset Management can resign on 120 days’ notice, and we may not be able to find a suitable replacement within that time, resulting in a disruption in our operations that could adversely affect our financial condition, business and results of operations.
- The Administrator can resign on 60 days’ notice from its role as our administrator under the Administration Agreement, and we may not be able to find a suitable replacement within that time, resulting in a disruption in our operations that could adversely affect our financial condition, business and results of operations.
- Our Common Shares may be purchased by the Adviser or its affiliates.
- The recommendations that the Adviser gives to the Fund may differ from those rendered to its other clients.
- The Investment Team or the Investment Committee may, from time to time, possess material nonpublic information, limiting our investment discretion.
- Soft dollars and research received and conducted on our behalf will be shared by others.
- The compensation we pay to the Adviser and, indirectly, to Nuveen Asset Management will be determined without independent assessment on our behalf, and these terms may be less advantageous to us than if such terms had been the subject of arm’s-length negotiations.
- The Intermediary Manager’s influence on this offering gives it the ability to increase the fees payable to the Adviser.
- Because the Intermediary Manager is an affiliate of the Adviser, you will not have the benefit of an independent review of our offering customarily performed in underwritten offerings.
- If we do not invest a sufficient portion of our assets in qualifying assets, we could fail to qualify as a BDC, which would have a material adverse effect on our business, financial condition and results of operations.
- Failure to maintain our status as a BDC would reduce our operating flexibility.
- Regulations governing our operation as a BDC affect our ability to and the way in which we raise additional capital.
- We are uncertain of our sources for funding our future capital needs; if we cannot obtain debt or equity financing on acceptable terms, our ability to acquire investments and to expand our operations will be adversely affected.
- We are a non-diversified investment company within the meaning of the 1940 Act, and therefore we are not limited by the 1940 Act with respect to the proportion of our assets that may be invested in securities of a single issuer.
- When we use leverage, the potential for loss on amounts invested in us will be magnified and may increase the risk of investing in us. Leverage also may adversely affect the return on our assets, reduce cash available for distribution to our shareholders, and result in losses.
- Provisions in our credit facility may limit discretion.
- Any defaults under a credit facility could adversely affect our business.
- We may form one or more CLOs, which may subject us to certain structured financing risks.
- We will be subject to U.S. federal income tax at corporate rates on our earnings if we are unable to qualify or maintain qualification as a RIC under Subchapter M of the Code.
- We may have difficulty paying our required distributions if we recognize income before, or without, receiving cash representing such income.
- Some of our investments may be subject to U.S. federal income tax at corporate rates.
- Our portfolio investments may present special tax issues.
- We may have difficulty sourcing investment opportunities.
- We face risks associated with the deployment of our capital.
- We may have difficulty paying distributions and the tax character of any distributions is uncertain.
- An investment in our Common Shares will have limited liquidity.
- Certain investors will be subject to Exchange Act filing requirements.
- Certain investors may be subject to the short-swing profits rules under the Exchange Act..
- Certain ERISA considerations.
- Our Board may consider certain mergers.
- Shareholders may experience dilution.
- Investing in our Common Shares involves a high degree of risk.
- The NAV of our Common Shares may fluctuate significantly.
Management Discussion
- A net increase (decrease) in net assets resulting from operations will vary from period to period as a result of various factors, including the level of new investment commitments, expenses, the recognition of realized gains and losses, and changes in unrealized appreciation and depreciation on the investment portfolio.
- On March 31, 2022, prior to the Fund’s election to be regulated as a BDC under the 1940 Act, TIAA contributed certain portfolio investments to the Fund and SPV I. The Fund accrued investment income on this portfolio beginning April 1, 2022.
- Investment income increased to $19.9 million and $36.0 million for the three and six months ended June 30, 2024, respectively, from $11.1 million and $21.4 million for the comparable period in the prior year, respectively, primarily due to increased investment activities driven by an increase in our deployed capital, slightly offset by a decrease in the weighted average yield of our debt and income producing investments as a result of spread tightening. As of June 30, 2024, the size of our portfolio increased to $935.5 million from $395.3 million, as of June 30, 2023, at cost. As of June 30, 2024, the weighted average yield of our debt and income producing investments decreased to 10.52% from 11.44% as of June 30, 2023, at cost, primarily due to the tightening of spreads in new investments entered during the period. We expect our portfolio will continue to grow as we raise and deploy capital through our offering and our investment income to grow commensurately. The shifting environment in base interest rates, such as SOFR and alternate rates, may affect our investment income over the long term.