AB 2020 Form 10-K

The Fund’s investment activities are managed by its external investment adviser, AB Private Credit Investors LLC, an investment adviser that is registered under the Advisers Act. The Fund’s required administrative services are provided by State Street Bank and Trust Company. The Fund is an “emerging growth company,” as defined in the JOBS Act. The Fund will remain an emerging growth company for up to five years following an initial public offering, if any, although if the market value of the Fund’s common stock that is held by non-affiliates exceeds $700 million as of any June 30 before that time, the Fund would cease to be an emerging growth company as of the following December 31. For so long as the Fund remains an emerging growth company under the JOBS Act, it will be subject to reduced public company reporting requirements. The Fund is conducting private offerings of Shares to investors in reliance on exemptions from the registration requirements of the Securities Act. At the closing of any Private Offering, each investor will make a Capital Commitment to purchase Shares pursuant to a subscription agreement entered into with the Fund. Investors will be required to fund drawdowns to purchase Shares up to the amount of their respective Capital Commitment on an as needed basis each time the Fund delivers a notice to its investors. On September 29, 2017, the Fund completed the Initial Closing of its Private Offering after entering into the Subscription Agreements with several investors, including the Adviser, providing for the private placement of the Fund’s common Shares. Under the terms of the Subscription Agreements, investors are required to fund drawdowns to purchase the Fund’s common Shares up to the amount of their respective Capital Commitments on an as-needed basis upon the issuance for a capital drawn-down notice. At December 31, 2020, the Fund had total Capital Commitments of $447,843,050. At December 31, 2019, the Fund had total Capital Commitments of $397,620,551. Capital Commitments may be drawn down by the Fund on a pro rata basis, as needed (including follow-on investments), for paying the Fund’s expenses, including fees under the Advisory Agreement, and/or maintaining a reserve account for the payment of future expenses or liabilities. Revenues The Fund’s investment objective is to generate current income and prioritize capital preservation through a portfolio that primarily invests in directly-sourced, privately-negotiated, secured, middle market loans. The Fund intends to primarily invest in middle market businesses based in the United States. The Fund expects that the primary use of proceeds by the companies in which the Fund invests will be for leveraged buyouts, recapitalizations, mergers and acquisitions and growth capital. The Fund will seek to build its portfolio in a defensive manner that minimizes cyclical and correlated risks across individual names and sector verticals by targeting companies with strong underlying business models and durable intrinsic value. The Fund will primarily hold secured loans, which encompass traditional first lien, unitranche and second lien loans, but may also invest in mezzanine, structured preferred stock and non-control equity co-investment opportunities. The Fund will seek to deliver attractive risk adjusted returns with lower volatility and low correlation relative to the public credit markets. The Adviser believes the Fund’s flexibility to invest across the capital structure and liquidity spectrum will allow the Fund to optimize investor risk-adjusted returns. Expenses Expenses for the year ended December 31, 2020, were $21,788,050, which consisted of $1,843,957 in collateral management fees, $200,000 in directors’ fees, $1,722,056 in professional fees, $8,616,494 in interest and borrowing expenses, $6,091,338 in management fees, $289,496 in insurance expense, $1,790,567 in income-based incentive fees, $451,514 in administration and custodian fees, $106,510 in organizational expenses, $50,199 in transfer agent fees, and $625,919 in other expenses. Pursuant to the Expense Support and Conditional Reimbursement Agreement, the Adviser provided expense support of $89,757 and the Fund reimbursed the Adviser $2,439,175 of expenses, resulting in net reimbursement to the Adviser of $2,349,418. The Adviser voluntarily waived collateral management fees of $1,843,957, voluntarily waived a portion of the Fund’s management fee of $1,863,539 and voluntarily waived a portion of the Fund’s incentive fee of $486,784, reducing the Fund’s expenses to $19,943,188. See “Item 15. — Notes to Consolidated Financial Statements — Note 3. Related Party Transactions — Expense Support and Conditional Reimbursement Agreement.” 61