How Corporate Capital Trust II Works
By investing in Corporate Capital Trust II, investors are able to pool their capital to invest in the debt of privately owned American companies. It is intended that these companies will then make interest payments to Corporate Capital Trust II, whose objective is to pass that income along to its investors through distributions.1
Given that this investment is speculative and has substantial costs, an investor must meet suitability standards prior to investing.
Non-traded BDCs, when operating as a regulated investment company (RIC), must distribute at least 90 percent of their taxable income to remain qualified as a RIC to reduce federal income taxes. Corporate Capital Trust II intends to elect and qualify for RIC status annually.
1 Distributions are not guaranteed in frequency or amount. Since inception, distributions have been supported by the advisors in the form of fee waivers and operating expense support waivers, and are not estimated to be a return of capital or supported by borrowed funds. Distributions exceed earnings and are not based on the investment performance; there can be no assurance that distributions will be sustained at current levels or at all. Corporate Capital Trust II is obligated to repay the advisors over several years, reducing future distributions and potentially diluting value for future shareholders.