PhenixFIN Corp

Note 13. Dividends

Any dividends and distributions to common stockholders are recorded on the ex-dividend date. Any amounts to be paid out as a dividend are determined by our board of directors.

We have adopted an “opt out” dividend reinvestment plan for our common stockholders. As a result, if we declare a cash dividend or other distribution, each stockholder that has not “opted out” of our dividend reinvestment plan will have its dividends automatically reinvested in additional shares of our common stock rather than receiving cash dividends. Stockholders who receive distributions in the form of shares of common stock will be subject to the same federal, state and local tax consequences as if they received cash distributions.

The Company did not declare any regular distribution payments during the three and six months ended March 31, 2024 and 2023.

Note 14. Share Transactions

On February 8, 2023, the Board of Directors approved the expansion of the amount authorized for repurchase under the Company’s share repurchase program from $25 million to $35 million. Since announcing this share repurchase program on January 11, 2021, the Company has repurchased an aggregate of 703,219 shares of common stock through March 31, 2024 with a total cost of approximately $28.1 million, or 25.8% of shares outstanding as of the program’s inception. The total remaining amount authorized under the expanded share repurchase program is approximately $6.9 million.

The following table sets forth the number of shares of common stock repurchased by the Company at an average price of $39.93 per share under its share repurchase program from February 10, 2021 through March 31, 2024:

During the six months ended March 31, 2024,53,348 shares were transferred into treasury, including 125 shares that were repurchased during the year ended September 30, 2023 and transferred into treasury during the six months ended March 31, 2024. As of March 31, 2024, there were 0 shares that were not yet transferred into treasury.

Note 15. Subsequent Events

Management has evaluated subsequent events through the date of issuance of the consolidated financial statements included herein. On April 9, 2024, the Company acquired 84,000,000 shares of common stock in ECC Capital Corporation (“ECC”), representing 44% of the outstanding shares of ECC, for $0.05 per share. As part of this transaction, ECC acquired from the Company 100% of the membership units of Kemmerer Holdings, LLC (“Kemmerer”) and the Company provided Senior Secured Promissory Note (“Note”) to ECC as consideration for ECC’s acquisition of Kemmerer, with the Note maturing on December 31, 2031. Interest on this note is accrued at a variable rate per annum equal to the sum of applicable three-month term SOFR rate plus 500 basis points. Further, in connection with this transaction, the Company, ECC and its Chairman and CEO Steve Holder entered into an investor rights agreement, pursuant to which ECC’s board of directors will include one director designated by the Company, one director designated by Mr. Holder, and one director designated by mutual agreement of the Company and Mr. Holder. Mr. Lorber will join ECC’s board of directors.

On May 2, 2024, the Company issued a 5.25% note due November 1, 2028 in the principal amount of $1,661,498 to National Security Insurance Company. The financial terms of the note are substantially the same as the 2028 Notes.

Other than the items disclosed herein, there have been no subsequent events that occurred during such period that would require disclosure in this Form 10-Q or would be required to be recognized in the Consolidated Financial Statements as of and for the three and six months ended March 31, 2024.