Crescent Capital BDC, Inc. (CCAP) Earnings Call Transcript & Summary

Ladies and gentlemen, thank you for standing by, and welcome to the Crescent Capital BDC Inc. 2021 Annual Meeting of Stockholders. I will now turn the call over to Mr. Jason Breaux, CEO of Crescent Capital BDC, Inc. Please go ahead, sir.

Thank you. The Annual Meeting of the Stockholders of Crescent Capital BDC, Inc. will please come to order. I, Jason Breaux, CEO of Crescent Capital BDC, Inc. will act as Chairman of this meeting; and Mr. Daniel McMahon will act as Secretary of this meeting. We are holding this year's annual meeting in a virtual-only format via the Internet due to the continued public health impact of the COVID-19 outbreak, to comply with government advisories limiting public gatherings and to support the health and well-being of our stockholders and employees. The notice of the meeting stated that the purpose of the meeting was to cover: one, the election of 2 Class III directors; and two, the ratification of the selection of Ernst & Young LLP as the corporation's independent registered public accounting firm. Mr. McMahon, will you please affirm proof of notice of this meeting?

I affirm that I have here a copy of the notice of the meeting dated April 1, 2021, together with an affidavit as to the mailing of the notice of meeting to stockholders of record at the close the business on April 1, 2021.

Mr. McMahon, having affirmed proof of the notice of this meeting, I order the affidavit of mailing to be filed with the minutes of this meeting. I hereby appoint Ms. Christel Pauli to act as the inspector of election to determine: one, the number of shares represented at the meeting; two, the existence of a quorum; and three, the validity and effect of proxies and to receive and tabulate the votes on the matters to be acted upon at the meeting. Ms. Pauli has executed an affidavit to execute her duties as an inspector faithfully. The secretary will attach the affidavit to the minutes of this meeting. Ms. Pauli has presented a list of stockholders as at the close of business on March 8, 2021, the record date fixed by the Board of Directors for the purpose of determining the stockholders entitled to notice of and to vote at this meeting.

There are 28,167,360 common shares entitled to vote at this meeting.

Each holder of common stock entitled to vote at this meeting has the right to 1 vote for each share recorded in their name. Ms. Pauli, please state the number of shares present in person or by proxy?

There are present in person or by proxy no less than 60 million shares, representing in excess of or greater than half of the shares issued and outstanding of the corporation entitled to vote at this meeting.

Legal notice of the meeting having been given and a quorum being present, the meeting is lawfully convened and ready to transact business. The polls are now open, and all stockholders entitled to vote at this meeting have the ability to do so online. If you are a stockholder entitled to vote and have not yet voted, or if you want to change your previously cast vote, please do so via the website used to access this meeting. Please remember that if you have already voted by proxy, it is not necessary to vote again. After voting has been completed on all matters on the agenda, we will close the polls, and the inspector of election will tally the votes, and I will report the preliminary votes for each proposal. The first order of business on the agenda is the election of Mr. Stephen Strandberg as a director to serve for a term expiring on the date on which the Annual Meeting, or special meeting in lieu thereof, of Stockholders will be held in 2024; and the election of Mr. Christopher Wright as a director to serve for a term expiring on the date on which the Annual Meeting, or the special meeting in lieu thereof, of Stockholders will be held in 2024. Each holder of common stock entitled to vote at this meeting has the right to 1 vote for each share recorded in their name. The second order of business on the agenda is the ratification of the selection of Ernst & Young LLP as the independent registered public accounting firm for the corporation for the fiscal year ending December 31, 2021. Each holder of common stock entitled to vote at this meeting has the right to 1 vote for each share recorded in their name. Since the presentation of each proposal is complete and everyone has had the opportunity to vote, the polls are now closed. Will the inspector of election please tally the votes? The inspector's preliminary report having been filed, I report on the voting as follows: the motion to elect Stephen Strandberg as a Director of the corporation for a 3-year term expiring at the Annual Meeting of Stockholders to be held in 2024 or until his successor is duly elected and qualified or until his earlier death, resignation or removal, received a majority of the votes cast at the meeting. Therefore, Mr. Strandberg is so elected. The motion to elect Christopher Wright as a Director of the corporation for a 3-year term expiring at the Annual Meeting of Stockholders to be held in 2024 or until his successor is duly elected and qualified or until his earlier death, resignation or removal, received a majority of the votes cast at the meeting. Therefore, Mr. Wright is so elected. The motion to ratify the selection of Ernst & Young LLP as the corporation's independent public registered accounting firm for the fiscal year ending December 31, 2021, received a majority of the votes cast at the meeting. Therefore, the motion to ratify the selection of Ernst & Young has been adopted. I'll note that we have received questions from stockholders attending this meeting. I will take a few moments to respond to some of those questions.

The first question is how will the potential increase in interest rates affect the company as well as the Biden tax plan?

The loans that we make in the BDC are floating rate corporate loans. So in a rising rate environment, that will actually translate into higher top line revenue in the form of interest income. On the debt that we use to finance certain growth in the portfolio, we have both fixed and floating rate debt. So the floating rate debt will also increase in a rising rate environment, while the fixed rate debt would stay constant. On the Biden tax plan, that has not yet passed. And at this point, we're not aware of any direct impact as a result of a pending plan. Our investors will continue to receive 1099s, reflecting their respective dividend distributions. That concludes the question-and-answer section of the meeting. There being no additional business, the meeting is hereby adjourned. Thank you for your participation and interest in Crescent Capital BDC.