CPEF Fund & Webinar – Certain Investment Considerations, Risks and Disclaimers

Illustrative Comparison Disclaimer (CPEF vs. Selected BDCs)

This presentation includes comparisons between Park Square Capital Credit Investments SCSp, SICAV-RAIF – Credit Partners Evergreen (B) (“CPEF”) and certain Business Development Companies (“BDCs”), including both publicly traded and private BDCs. These comparisons are provided for illustrative purposes only and are not intended to be, and should not be relied upon as, a definitive or comprehensive comparison of CPEF against BDCs generally. BDCs vary materially in their investment strategies, structures, fee arrangements, leverage profiles, regulatory frameworks and performance characteristics. As such, the performance and characteristics of any individual BDC, or subset of BDCs referenced herein, may not be representative of the broader BDC market. Any BDCs selected for comparison have been chosen solely to illustrate particular points and do not represent the full range of BDC strategies or outcomes. Different selection criteria could result in materially different comparisons and conclusions. Past performance is not indicative of future results.

General Economic and Financial Market Conditions

The operating results, financial condition, activities, and prospects of the Fund could be materially adversely affected by instability in the European or global financial markets, changes in market, economic, political, technological, regulatory or social conditions, as well as by numerous other factors outside the control of Park Square Capital.

Recent disruptions in the debt markets have affected the price of, as well as the ability to make, certain types of investments, and there can be no assurance that these disruptions will not continue or worsen in the future. The Fund could be adversely affected by the foregoing events, or by similar or other events in the future. In addition, these recent events directly affect the Fund’s ability to procure, and the terms of, its own financing arrangements.

Furthermore, such recent and current disruptions may have a direct or indirect negative effect on a wide range of issuers and could increase the likelihood that such issuers will be unable to make principal and interest payments on, or refinance, outstanding debt. Moreover, the risk that such disruptions will affect an issuer’s ability to pay its debts and obligations when due is enhanced if such issuer in turn provides credit to third parties or otherwise participates in the credit markets. In the event of such defaults, the Fund could lose both Invested Capital in, and anticipated profits from, any affected investments.

Lack of Operating History

The Fund is comprised of newly-formed entities and has no operating history. The past investment performance of portfolios advised or managed by Park Square may not be construed as an indication of the future results of an investment in the Fund. The Fund’s investment program should be evaluated on the basis that there can be no assurance that Park Square Capital’s assessment of the short-term or long-term prospects of investments will prove accurate or that the Fund will achieve its investment objectives.

Investments in Highly Leveraged Companies

The Fund’s (and the joint venture’s) investments are expected to include companies whose capital structures could have significant leverage. Such investments are inherently more sensitive than others to declines in revenues and to increases in expenses and interest rates. Such leveraged capital structures will increase the exposure of the portfolio companies to adverse economic factors such as downturns in the economy or deterioration in the business of the portfolio company or its industry. Additionally, the investments of the Fund (or the joint venture) could include investments that are subordinated in what will typically be a complex capital structure, and thus subject to the greatest risk of loss.

Illiquidity of Investments

Prospective investors must realise that the portion of the Fund’s investment portfolio that consists of mezzanine or certain cases of other subordinated debt will be difficult to value, and they should view an investment in the Fund with respect to investments in mezzanine or certain cases of other subordinated debt as being illiquid. There is no readily available market for most of the Fund’s mezzanine or other subordinated debt investments, and disposition of such investments may require a lengthy time period. Losses on unsuccessful mezzanine or other subordinated debt investments could be realised before gains on successful mezzanine or other subordinated debt investments are realised.

Subordinated Investments

Subordinated debt investment eligible under the Fund’s investment strategy will typically be unsecured and subordinated to substantial amounts of senior indebtedness, all or a significant portion of which may be secured. The ability of the Fund to influence a portfolio company’s affairs, especially during periods of financial distress or following insolvency is likely to be substantially less than that of senior creditors. For example, under terms of subordination agreements, senior creditors are typically able to block the acceleration of the mezzanine or other subordinated debt or other exercises by the Fund of its rights as a creditor. Accordingly, the Fund may not be able to take the steps necessary to protect its investments in a timely manner or at all. In addition, the subordinated debt securities in which the Fund may invest may not be protected by financial covenants or limitations.

upon additional indebtedness, may have limited liquidity, and may not be rated by a credit rating agency. Such debt securities are also subject to other creditor risks, including, but not limited to (i) the possible invalidation of an investment transaction as a “fraudulent conveyance” under relevant creditors’ rights laws, (ii) so-called lender liability claims by the issuer of the obligations; and (iii) environmental liabilities that may arise with respect to collateral securing the obligations.

Loans to Private Companies

A portion of the Fund’s portfolio may consist of loans to medium-sized, privately owned businesses. Compared to larger, publicly owned firms, such companies generally have limited financial resources and access to capital, as well as higher funding costs. They may be in a weaker financial position and may need more capital to expand or compete. These companies frequently have shorter operating histories, narrower product lines and smaller market shares than larger businesses, which render them more vulnerable to competitors’ actions and market conditions, as well as general economic downturns. There may not be as much information publicly available about these companies as would be available for public companies and such information may not be of the same quality. These companies are also more likely to depend on the management talents and efforts of a small group of persons and, as a result, the death, disability, resignation or termination of one or more of these persons could have a material adverse impact on these companies’ ability to meet their obligations. The above challenges increase the risk of these companies defaulting on their obligations.

Leverage / Financing

The Fund (or the joint venture with SMBC)¹ may utilise leverage/financing (up to certain limits) to finance, or otherwise in connection with, their investments. The use of such leverage/financing involves a high degree of financial risk. Although borrowings by the Fund (or the joint venture) has the potential to enhance overall returns that exceed the Fund’s (and the joint venture’s) cost of funds, they will further diminish returns (or increase losses on capital) to the extent overall returns are less than the Fund’s (or the joint venture’s) cost of funds. Additionally, if the investments fail to perform to expectations, the interest of investors in the Fund would be subordinated to such leverage/financing , which would compound any such adverse consequences. Further, borrowings by the Fund may be secured by the capital commitments of the partners of the Fund as well as by the Fund’s (or the joint venture’s) assets. The use of leverage/financing to finance investments generally may result in “unrelated business taxable income” for U.S. tax-exempt investors.

Interest Rate Fluctuations

General interest rate fluctuations (including without limitation fluctuations in the base rate and LIBOR/EURIBOR indices and similar indices) may have a substantial negative impact on the Fund’s investments and investment opportunities and accordingly may have a material adverse effect on the Fund’s investment objectives and the rate of return on Invested Capital. In addition, an increase in interest rates would make it more expensive to utilise leverage in making investments.

Currency Risks

The Fund’s assets will be invested in companies incorporated under the laws of various jurisdictions, and the income and gains received by the Fund may be denominated in several different currencies. Changes in currency exchange rates may adversely affect the value of investments, interest and dividends received by the Fund, gains and losses realised on the disposition of investments, and the amount of distributions, if any, to be made by the Fund. While the Fund is permitted to engage in currency hedging activities, the Fund is not obligated to do so. Moreover there can be no assurance as to the success of any currency hedging operations that the Fund may implement.

Assets are being hedged to Euros in the Fund². The Fund will hedge certain parts of itself to the Feeder in the Feeder currency.

Forward‑Looking Statements and Hypothetical Performance

This presentation contains forward‑looking statements and may include hypothetical or projected performance. Such statements and performance are based on assumptions and are subject to risks and uncertainties. Hypothetical performance does not represent actual results and has inherent limitations. There can be no assurance that projected results will be achieved. Past performance is not indicative of future results.