Higher Market Capitalization and Liquidity May Make the Companys Shares More Attractive to
Investors
If the Company issues additional Shares, its market capitalization and the amount of its publicly tradable Shares may
increase, which may afford stockholders greater liquidity. A larger market capitalization may make the Shares more attractive to a larger number of investors who have limitations of the size of companies in which they invest. Furthermore, a larger
number of Shares outstanding may increase the Companys trading volume, which could decrease the volatility in the secondary market price of its Shares.
Reduced Expenses Per Share
An
offering that increases the Companys total assets may reduce its overall expenses per Share due to the spreading of fixed expenses over a larger asset base. The Company must bear certain fixed expenses, such as certain administrative,
governance and compliance costs that do not generally vary based on its size. On a per Share basis, these fixed expenses would be reduced when supported by a larger asset base.
Market Conditions Have Created, and May in the Future Create, Attractive Investment and Acquisition Opportunities
Market conditions may from time to time provide attractive opportunities to deploy capital, including at times when the Shares may be trading
at a price below NAV per Share. For example, during the global financial crisis of 2008 and for several years afterward, the global capital markets experienced a period of disruption as evidenced by a lack of liquidity in the debt capital markets,
significant write-offs in the financial services sector, the re-pricing of credit risk in the broadly syndicated credit market and the failure of certain major domestic and international financial
institutions. Despite actions of the United States federal government and foreign governments, these events contributed to worsening general economic conditions that materially and adversely impacted the broader financial and credit markets and
reduced the availability of debt and equity capital for the market as a whole and financial services firms in particular.
Since the
events of 2008, there have been continuing periods of volatility, some lasting longer and with a greater degree of magnitude than others, including recent market conditions that have been driven by the impact of
COVID-19, and the widespread interruption to the functioning of the U.S. and global economies.
The Company believes that favorable investment opportunities to invest at attractive risk-adjusted returns, including opportunities to make
acquisitions of other companies or investment portfolios at attractive values, may be created during periods of market disruption and volatility. However, periods of disruption and volatility, like the one we experienced recently, may also adversely
affect the Companys access to sufficient debt and equity capital in order to take advantage of attractive opportunities that are created during these periods. In addition, the debt capital that will be available, if any, may be at a higher
cost and on less favorable terms and conditions in the future. Stockholder approval of the Share Issuance Proposal, subject to the conditions set forth herein, would provide the Company with the flexibility to raise equity capital to invest in such
attractive investment opportunities, which typically need to be made expeditiously.
The additional capital raised through an offering of
the Companys Shares may also help the Company generate additional investment opportunities. With more capital to make investments, the Company could be a more meaningful capital provider and such additional capital would allow it to compete
more effectively for high-quality investment opportunities. Such investment opportunities may be funded with proceeds of an offering of Shares.
There is no assurance that our stockholders will realize the benefits discussed above.
Trading History
The Companys Shares
have been listed on The NASDAQ Global Select Market (NASDAQ) under the symbol CGBD since June 14, 2017. Prior to such date, there was no public market for the Companys Shares. The Companys Shares have
historically traded at prices both above and below the Companys NAV per Share. It is not possible to predict whether the Companys Shares will trade at, above or below the Companys NAV in the future.
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