PROSPECT CAPITAL CORP
For the period ended Jun 30, 2025. Filed Aug 26, 2025.
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A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2025 · Filed Aug 26, 2025
PSEC$1.41+1.8%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2024-06-30; filed 2024-08-28.
0001287032-24-000280
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2025-06-30; filed 2025-08-26.
0001287032-25-000232
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 248 previous paragraphs and 267 current paragraphs.
135 unchanged; 89 reworded; 31 added; 20 removed; 4 previous and 12 current paragraphs rearranged.
Tables are not compared: 26 previous and 29 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (31)
Current report
Our investment objective is to generate both current income and long-term capital appreciation. We intend to invest primarily in privately owned United States (“U.S.”) middle market companies, in senior and secured first lien loans and, to a lesser extent, second lien loans, as well as equity and equity-linked investments with capital-appreciation potential (such as senior and secured convertible debt, preferred equity, common equity and warrants). Most of our investments will be in private U.S. companies; however, we may also invest to some extent in broadly-traded public companies and non-U.S. companies (subject to compliance with BDC requirements to invest at least 70% of assets in “eligible portfolio companies,” which are generally privately offered securities issued by U.S. private or thinly-traded companies). We are a non-diversified company within the meaning of the 1940 Act.
Current report
Our primary investment strategy is investing in private, middle-market companies in the U.S. in need of capital for refinancings, acquisitions, capital expenditures, growth initiatives, recapitalizations and other purposes. Typically, we focus on making investments in middle-market companies with annual revenues of less than $750 million and enterprise values of less than $1 billion. These private, middle-market companies are primarily owned by private equity funded and independent sponsors or us, as well as by a portfolio company’s management team, founder(s), or other investors. Our typical investment involves a senior and secured loan of less than $250 million.
Current report
Our investments in senior and secured loans are generally senior debt instruments that rank ahead of unsecured debt and equity of a given portfolio company. These loans also have the benefit of security interests on assets of the applicable portfolio company, which often rank ahead of any other security interests. We also make equity and equity-linked investments with capital-appreciation potential (such as senior and secured convertible debt, preferred equity, common equity and warrants).
Current report
We directly originate the significant majority of our investments through our long-term relationships with private equity funded and independent sponsors, financial intermediaries, and management teams, as well as other sources. We seek to maximize returns, including both current yield and capital-appreciation potential, and minimize risk for our investors by applying rigorous credit and other analyses and cash-flow and asset-based lending techniques to originate, close, and monitor our investments.
Current report
We are consistently pursuing multiple investment opportunities. There can be no assurance that we will successfully consummate any investment opportunity we pursue. If any of these opportunities are consummated, there can be no assurance that investors will share our view of valuation or that any assets acquired will not be subject to future write downs, each of which could have an adverse effect on our stock price.
Current report
Our previously outstanding 6.375% convertible notes due 2025, which matured during the fiscal year ended June 30, 2025, are referred to as the “2025 Notes” or the “Convertible Notes”. Our previously outstanding 3.706% unsecured notes due 2026, which redeemed during the fiscal year ended June 30, 2025, are referred to as the “2026 Notes”. Our $300.0 million of 3.364% unsecured notes due 2026 are referred to as the “3.364% 2026 Notes”. Our $300.0 million of 3.437% unsecured notes due 2028 are referred to as the “3.437% 2028 Notes”, and collectively with the 2026 Notes, and the 3.364% 2026 Notes are the “Public Notes”. Any corporate notes issued pursuant to our medium term notes program with InspereX LLC are referred to as “Prospect Capital InterNotes®”. The Convertible Notes, Public Notes, and Prospect Capital InterNotes® are collectively referred to as the “Unsecured Notes”.
Current report
During the three months ended June 30, 2025, we commenced a tender offer to purchase for cash any and all of the aggregate principal amount of our outstanding 2026 Notes at a purchase price of 99.00%, plus accrued and unpaid interest. As a result, $135,731 aggregate principal amount of the 2026 Notes were validly tendered and accepted, and we recognized a net realized gain of $874 from the extinguishment of debt in the amount of the difference between the reacquisition price and the net carrying amount of the tendered 2026 Notes.
Current report
On June 18, 2025, we redeemed the remaining outstanding principal amount of $207,216 of the 2026 Notes, at a price of 100.00%, plus accrued and unpaid interest. The transaction resulted in our recognizing a loss of $998 during the three months ended June 30, 2025. Following the redemption, none of the 2026 Notes remained outstanding.
Current report
(2) As of June 30, 2025, certain industries classifications have been revised compared to June 30, 2024 to align with updated industry structures.
Current report
(2) Approximately$90,253 and $141,028 was accrued as PIK interest income during the year ended June 30, 2025 and June 30, 2024, respectively.
Current report
(5) Negative denotes reversal of receipts previously recorded as return of capital.
Current report
Belnick, LLC (d/b/a The Ubique Group)
Current report
On March 31, 2025, Prospect exercised certain rights and remedies under its loan documents to exercise voting rights in respect of the equity of Belnick, LLC and certain of its subsidiaries (“Belnick”) to, among other things, appoint new officers, all of whom are our Investment Adviser’s professionals. As a result, Prospect’s investment in Belnick is classified as a control investment. Belnick is a provider of high-volume, value-oriented furniture and furnishings to a broad range of residential and commercial end markets.
Current report
The fair value of our investment in Belnick was $51,166 as of June 30, 2025, a discount of $37,086 to its amortized cost basis compared to a fair value of $84,250 as of June 30, 2024, a discount of $302 to its amortized cost. The increase in discount to amortized cost resulted from a decline in financial performance.
Current report
NMMB Holdings, Inc.
Current report
Prospect owns 92.77% of the fully-diluted equity of NMMB Holdings, Inc. (“Refuel”). NMMB, through its subsidiary, Refuel Agency, provides integrated marketing and advertising services to brands across industries.
Current report
The fair value of our investment in Refuel was $72,207 as of June 30, 2025, a premium of $42,484 to its amortized cost basis compared to a fair value of $94,265 as of June 30, 2024, a premium of $64,542 to its amortized cost. The decrease in premium to amortized cost resulted from a revised forecast impacted by continued headwinds in the advertising market and a dividend declared by Refuel.
Current report
Pacific World Corporation
Current report
On May 29, 2018, Prospect exercised its rights and remedies under its loan documents to exercise the shareholder voting rights in respect of the stock of Pacific World Corporation (“Pacific World”) and to appoint a new Board of Directors of Pacific World. As a result, as of June 30, 2018, Prospect’s investment in Pacific World is classified as a control investment. Pacific World supplies nail and beauty care products to food, drug, mass, and value retail channels worldwide.
Current report
The fair value of our investment in Pacific World was $107,970 as of June 30, 2025, a discount of $228,143 to its amortized cost compared to a fair value of $104,663 as of June 30, 2024, a discount of $215,733 to its amortized cost. The increase in discount to amortized cost resulted from increased debt in the capital structure.
Current report
As of June 30, 2024, the outstanding principal amount of the 2025 Notes was $156,168. On March 3, 2025 we repaid the remaining outstanding principal amount of $156,168 of the 2025 Notes, plus interest, at maturity. Following the maturity of the 2025 Notes during the year ended June 30, 2025, none of the 2025 Notes remained outstanding. See Note 5. Convertible Notes within our consolidated financial statements for additional details.
Current report
As of June 30, 2024, the outstanding aggregate principal amount of the 2026 Notes was $400,000. During the year ended June 30, 2025, we repurchased $57,053 aggregate principal amount of the 2026 Notes at a weighted average price of 97.44%, including commissions, plus accrued and unpaid interest. As a result, we recognized a net realized gain of $1,264 from the extinguishment of debt in the amount of the difference between the reacquisition price and the net carrying amount of the repurchased 2026 Notes.
Current report
During the year ended June 30, 2025, we commenced a tender offer to purchase for cash any and all of the aggregate principal amount of our outstanding 2026 Notes at a purchase price of 99.00%, plus accrued and unpaid interest. As a result, $135,731 aggregate principal amount of the 2026 Notes were validly tendered and accepted, and we recognized a net realized gain of $874 from the extinguishment of debt in the amount of the difference between the reacquisition price and the net carrying amount of the tendered 2026 Notes.
Current report
On June 18, 2025, we redeemed the remaining outstanding principal amount of $207,216 of the 2026 Notes, at a price of 100.00%, plus accrued and unpaid interest. The transaction resulted in our recognizing a loss of $998 during the year ended June 30, 2025. Following the redemption, none of the 2026 Notes remained outstanding.
Current report
The weighted average interest rate earned on performing interest bearing assets decreased to 9.66% for the year ended June 30, 2025 from 10.62% for the year ended June 30, 2024. The weighted average interest rate earned on all interest bearing investments decreased to 8.90% for the year ended June 30, 2025 from 10.02% for the year ended June 30, 2024. The decrease is primarily due to a $82,385 reduction in interest income recognized on our portfolio company investments as a result of repayments and declines in SOFR rates coupled with an $21,705 decline in interest income from our structured credit securities, offset by an increase in original issue discount (“OID”) accretion and Prepayment Penalty income of $4,886.
Current report
(1)Our Research Now Group, LLC and Dynata, LLC Second Lien Term Loan was restructured to 100,000 shares of Common Stock of New Insight Holdings, Inc. and 285,714 Warrants (to purchase shares of Common Stock of New Insight Holdings, Inc.) during the year ended June 30, 2025. A portion of the cost basis exchanged was written-off for tax purposes and we recorded a realized loss of $48,118 to our investment in Research Now Group, LLC and Dynata, LLC.
Current report
(3)During fiscal year 2025, the Company elected to exit its exposure to SSN investments. As a result, the Company ceased new originations in that asset class and initiated a full wind‑down of the portfolio. For the year ended June 30, 2025, the Company recognized realized losses of $432,592 and a change in unrealized gain of $89,170.
Current report
(1)Our Research Now Group, LLC and Dynata, LLC Second Lien Term Loan was restructured to 100,000 shares of Common Stock of New Insight Holdings, Inc. and 285,714 Warrants (to purchase shares of Common Stock of New Insight Holdings, Inc.). A portion of the cost basis exchanged was written-off for tax purposes and we recorded a realized loss of $48,118 while reversing our previous previously recorded unrealized losses related to our investment in Research Now Group, LLC and Dynata, LLC.
Current report
(2)During fiscal year 2025, the Company elected to exit its exposure to SSN investments. As a result, the Company ceased new originations in that asset class and initiated a full wind‑down of the portfolio. For the year ended June 30, 2025, the Company recognized realized losses of $432,592 and a change in unrealized gain of $89,170.
Current report
Additionally, we have covenanted to waive the applicable 2% / 5% / 20% redemption limits for the Floating Rate Preferred Stock as set forth in the terms of the Floating Rate Preferred Stock such that holders of the Floating Rate Preferred Stock may, in addition to the amount of Floating Rate Preferred Stock such holders are entitled to redeem pursuant to the terms of the Floating Rate Preferred Stock, also redeem an amount of such Floating Rate Preferred Stock equal to the lowest excess, if any, between the corresponding applicable 2% / 5% / 20% redemption limits for the 7.50% Preferred Stock as set forth in the terms of the 7.50% Preferred Stock and the respective amounts requested for the 7.50% Preferred Stock on a Holder Redemption Deadline for the 7.50% Preferred Stock.
Current report
On August 26, 2025, we announced the declaration of monthly dividends for our for 7.50% Preferred Stock holders of record on the following dates based on an annualized rate equal to 7.50% of the stated value of $25.00 per share as set forth in the Articles Supplementary for the Preferred Stock, from the date of issuance or, if later from the most recent dividend payment date (the first business day of the month, with no additional dividend accruing in November as a result), as follows:
Removed paragraphs (20)
Previous report
Our investment objective is to generate both current income and long-term capital appreciation through debt and equity investments. We invest primarily in senior and subordinated secured debt and equity of private companies in need of capital for acquisitions, divestitures, growth, development, recapitalizations and other purposes. We work with the management teams or financial sponsors to seek investments with historical cash flows, asset collateral or contracted pro-forma cash flows.
Previous report
•Lending to Companies - We make directly-originated, agented loans to companies, including companies which are controlled by private equity sponsors and companies that are not controlled by private equity sponsors (such as companies that are controlled by the management team, the founder, a family or public shareholders). This debt can take the form of first lien, second lien, unitranche or unsecured loans. These loans typically have equity subordinate to our loan position. We may also purchase selected equity co-investments in such companies. In addition to directly-originated, agented loans, we also invest in senior and secured loans syndicated loans and high yield bonds that have been sold to a club or syndicate of buyers, both in the primary and secondary markets. These investments are often purchased with a long term, buy-and-hold outlook, and we often look to provide significant input to the transaction by providing anchoring orders.
Previous report
•Lending to Companies and Purchasing Controlling Equity Positions in Such Companies - This strategy involves purchasing senior and secured yield-producing debt and controlling equity positions in operating companies across various industries. We believe this strategy provides enhanced certainty of closing to sellers and the opportunity for management to continue on in their current roles. These investments are often structured in tax-efficient partnerships, enhancing returns.
Previous report
•Investing in Structured Credit - We make investments in structured credit, often taking a significant position in subordinated structured notes (equity). The underlying portfolio of each structured credit investment is diversified across approximately 100 to 200 broadly syndicated loans and does not have direct exposure to real estate, mortgages, or consumer-based credit assets. The structured credit portfolios in which we invest are managed by established collateral management teams with many years of experience in the industry.
Previous report
We invest primarily in first and second lien secured loans and unsecured debt, which in some cases includes an equity component. First and second lien secured loans generally are senior debt instruments that rank ahead of unsecured debt of a given portfolio company. These loans also have the benefit of security interests on the assets of the portfolio company, which may rank ahead of or be junior to other security interests. Our investments in structured credit are subordinated to senior loans and are generally unsecured. We invest in debt and equity positions of structured credit which are a form of securitization in which the cash flows of a portfolio of loans are pooled and passed on to different classes of owners in various tranches. Our structured credit investments are derived from portfolios of corporate debt securities which are generally risk rated from BB to B.
Previous report
During the three months ended June 30, 2024, we increased total commitments to the Revolving Credit Facility by $112,000 to $2,066,500 in the aggregate.
Previous report
(2) During the year ended June 30, 2024, approximately$134,505 of PIK interest capitalized was accrued as interest income and$0 was included due to the timing of interest prepayment dates and resulting capitalization occurring during the prior year. During the year ended June 30, 2023, approximately $130,789 of PIK interest capitalized was accrued as interest income and the remaining $1,298 was included due to the timing of interest payment dates and resulting capitalization occurring during the prior year.
Previous report
MITY, Inc.
Previous report
Prospect owns 100% of the equity of MITY Holdings of Delaware Inc. (“MITY Delaware”), a Consolidated Holding Company. MITY Delaware owns 100% of the equity of MITY, Inc. (f/k/a MITY Enterprises, Inc.) (“MITY”). MITY owns 100% of each of MITY-Lite, Inc. (“MITY-Lite”); Broda USA, Inc. (f/k/a Broda Enterprises USA, Inc.) (“Broda USA”); and Broda Enterprises ULC (“Broda Canada”). MITY is a designer, manufacturer and seller of multipurpose room furniture and specialty healthcare seating products.
Previous report
The fair value of our investment in MITY, Inc. increased to $85,583 as of June 30, 2024, representing a discount of $4,464 to its amortized cost basis, compared to a fair value of $68,178 as of June 30, 2023, representing a discount of $16,719 to its amortized cost basis. The increase in fair value was primarily driven by an improvement in financial performance.
Previous report
The rated secured structured note investments held by certain of NPRC’s wholly owned subsidiaries are subordinated debt interests in broadly syndicated loans managed by established collateral management teams with many years of experience in the industry. As of June 30, 2024, the outstanding investment in rated secured structured notes by certain of NPRC’s wholly owned subsidiaries was comprised of 110 investments with a fair value of $425,671 and face value of $446,180. The average outstanding note is approximately $4,057 with an expected maturity date ranging from July 2028 to July 2034 and weighted-average expected maturity of 6 years as of June 30, 2024. Coupons range from three-month SOFR (“3M”) plus 5.20% to 9.23% with a weighted-average coupon of 3M + 6.94%. As of June 30, 2024, our senior secured term loan debt and common equity investments in NPRC and its wholly-owned subsidiaries relating to rated secured structured notes had a fair value of $243,036. As of June 30, 2024, based on outstanding notional balance, 43.9% of the portfolio was invested in Single - B or below rated tranches and 56.1% of the portfolio in BB or above rated tranches.
Previous report
R-V Industries, Inc.
Previous report
Prospect owns 87.75% of the fully-diluted equity of R-V Industries, Inc. (“R-V”), with R-V management owning the remaining 12.25% of the equity. R-V is a provider of engineering and manufacturing services to chemical, paper, pharmaceutical, and power industries.
Previous report
The fair value of our investment in UTP increased to $68,067 as of June 30, 2024, a premium of $432 from its amortized cost basis, compared to a fair value of $45,065 as of June 30, 2023, representing a discount of $20,119 to it amortized cost. The increase in fair value was driven by an improvement in financial performance and expansion of comparable company trading multiples.
Previous report
As of June 30, 2024 and June 30, 2023, the outstanding principal amount of the 2025 Notes were $156,168 and $156,168, respectively. Refer to Note 5. Convertible Notes within our consolidated financial statements for additional details.
Previous report
As of June 30, 2024 and June 30, 2023, the outstanding aggregate principal amount of the 2026 Notes was $400,000 and $400,000, respectively.
Previous report
The average interest earned on interest bearing performing assets decreased to 10.62% for the year ended June 30, 2024 from 10.73% for the year ended June 30, 2023. Theweighted average interest rate earned on our performing interest bearing investments decreased by 0.11% due to a decrease in income from our structured credit investments to $35,722 from $94,232, for the years ended June 30, 2024 and 2023, respectively, offset by an increase in the weighted average interest rate earned on our portfolio primarily due to LIBOR/SOFR rates rising above our floors amongst our interest-bearing investments, for which interest income increased to $726,654 from $660,699, for the years ended June 30, 2024 and 2023, respectively. The average interest earned on all interest bearing assets decreased to 10.02% for the year ended June 30, 2024 from 10.16% for the year ended June 30, 2023. Theweighted average interest rate earned on all interest bearing investments decreased by 0.14% primarily due to a decrease in income from our structured credit investments for the years ended June 30, 2024 and 2023, respectively, and offset by an increase to interest income due to LIBOR/SOFR rates rising above our floors amongst our interest-bearing investments.
Previous report
On July 30, 2024, we increased total commitments to the Revolving Credit Facility by $55 million to $2.1215 billion in the aggregate. Aggregate commitments are from an expanded group of 48 banks.
Previous report
On August 6, 2024, we funded a $127,000 first lien senior secured term loan to support the refinancing of Global TelLink Corporation (d/b/a ViaPath Technologies.). In connection with the refinancing, our $9,497 first lien term loan and $122,670 second lien term loan to Global TelLink Corporation (d/b/a ViaPath Technologies.) were fully repaid at par.
Previous report
During the period of July 1, 2024, through August 28, 2024, we issued $73,483 inaggregate principal amount of Prospect Capital InterNotes® for net proceeds of $72,410, with $6,659 of such aggregate principal amount scheduled to settle on August 29, 2024.
Reworded paragraphs (89)
Previous wording
We consolidate certain of our wholly owned and substantially wholly owned holding companies formed by us in order to facilitate our investment strategy. The following companies are included in our consolidated financial statements and are collectively referred to as the “Consolidated Holding Companies”: CP Holdings of Delaware LLC (“CP Holdings”); Credit Central Holdings of Delaware, LLC (“Credit Central Delaware”); Energy Solutions Holdings Inc.; First Tower Holdings of Delaware LLC (“First Tower Delaware”); MITY Holdings of Delaware Inc. (“MITY Delaware”); Nationwide Acceptance Holdings LLC; NMMB Holdings, Inc. (“NMMB Holdings”); NPH Property Holdings, LLC (“NPH”); Prospect Opportunity Holdings I, Inc. (“POHI”); SB Forging Company, Inc. (“SB Forging”); STI Holding, Inc.; UTP Holdings Group Inc. (“UTP Holdings”); Valley Electric Holdings I, Inc. (“Valley Holdings I”); and Valley Electric Holdings II, Inc. (“Valley Holdings II”).
Current wording
We consolidate certain of our wholly owned and substantially wholly owned holding companies formed by us in order to facilitate our investment strategy. The following companies are included in our consolidated financial statements and are collectively referred to as the “Consolidated Holding Companies”: Belnick Holdings of Delaware, LLC (“Belnick Delaware”); CP Holdings of Delaware LLC (“CP Holdings”); Credit Central Holdings of Delaware, LLC (“Credit Central Delaware”); Energy Solutions Holdings Inc.; First Tower Holdings of Delaware LLC (“First Tower Delaware”); MITY Holdings of Delaware Inc. (“MITY Delaware”); Nationwide Acceptance Holdings LLC; NMMB Holdings, Inc. (“NMMB Holdings”); NPH Property Holdings, LLC (“NPH”); Prospect Opportunity Holdings I, Inc. (“POHI”); SB Forging Company, Inc. (“SB Forging”); STI Holding, Inc.; UTP Holdings Group Inc. (“UTP Holdings”); Valley Electric Holdings I, Inc. (“Valley Holdings I”); and Valley Electric Holdings II, Inc. (“Valley Holdings II”).
Previous wording
•Purchasing Controlling Equity Positions and Lending to Real Estate Companies - We purchase debt and controlling equity positions in tax-efficient real estate investment trusts (“REIT” or “REITs”). The real estate investments of National Property REIT Corp. (“NPRC”) are in various classes of developed and occupied real estate properties that generate current yields, including multi-family properties, student housing and senior living. NPRC seeks to identify properties that have historically significant occupancy rates and recurring cash flow generation. NPRC generally co-invests with established and experienced property management teams that manage such properties after acquisition. Additionally, NPRC makes investments in rated secured structured notes (primarily debt of structured credit). NPRC also purchases loans originated by certain consumer loan facilitators. It purchases each loan in its entirety (i.e., a “whole loan”). The borrowers are consumers, and the loans are typically serviced by the facilitators of the loans.
Current wording
We also invest a lesser amount of our assets in senior and secured debt and controlling equity positions in real estate investment trusts (“REIT” or “REITs”). The real estate investments of National Property REIT Corp. (“NPRC”) are in various classes of developed and occupied real estate properties that generate current yields, including multi-family properties and other tenant-diversified properties; historically, NPRC made investments in structured credit (primarily debt tranches). We historically invested in structured credit (primarily equity tranches).
Previous wording
We currently have four primary strategies that guide our origination of investment opportunities: (1) lending to companies, including companies controlled by private equity sponsors and not controlled by private equity sponsors, and including both directly-originated loans and syndicated loans, (2) lending to companies and purchasing controlling equity positions in such companies, including both operating companies and financial services companies, (3) purchasing controlling equity positions and lending to real estate companies, and (4) investing in structured credit. We may also invest in other strategies and opportunities from time to time that we view as attractive. We continue to evaluate other origination strategies in the ordinary course of business with no specific top-down allocation to any single origination strategy.
Current wording
We may also invest in other strategies and opportunities from time to time that the Investment Adviser views as attractive. The Investment Adviser may continue to evaluate other origination strategies in the ordinary course of business with no specific top-down allocation to any single origination strategy.
Previous wording
We hold many of our control investments in a two-tier structure consisting of a holding company and one or more related operating companies for tax purposes. These holding companies serve various business purposes including concentration of management teams, optimization of third-party borrowing costs, improvement of supplier, customer, and insurance terms, and enhancement of co-investments by the management teams. In these cases, our investment, which is generally equity in the holding company, the holding company’s equity investment in the operating company and any debt from us directly to the operating company structure represents our total exposure for the investment. As of June 30, 2024, as shown in our Consolidated Schedule of Investments, the cost basis and fair value of our investments in controlled companies was $3,280,415 and $3,872,575, respectively. This structure gives rise to several of the risks described in our public documents and high lighted elsewhere in this Annual Report. We consolidate all wholly owned and substantially wholly owned holding companies formed by us for the purpose of holding our controlled investments in operating companies. There is no significant effect of consolidating these holding companies as they hold minimal assets other than their investments in the controlled operating companies. Investment company accounting prohibits the consolidation of any operating companies.
Current wording
We hold many of our control investments in a two-tier structure consisting of a holding company and one or more related operating companies for tax purposes. These holding companies serve various business purposes including concentration of management teams, optimization of third-party borrowing costs, improvement of supplier, customer, and insurance terms, and enhancement of co-investments by the management teams. In these cases, our investment, which is generally equity in the holding company, the holding company’s equity investment in the operating company and any debt from us directly to the operating company structure represents our total exposure for the investment. As of June 30, 2025, as shown in our Consolidated Schedule of Investments, the cost basis and fair value of our investments in controlled companies was $3,416,244 and $3,696,367, respectively. This structure gives rise to several of the risks described in our public documents and highlighted elsewhere in this Annual Report. We consolidate all wholly owned and substantially wholly owned holding companies formed by us for the purpose of holding our controlled investments in operating companies. There is no significant effect of consolidating these holding companies as they hold minimal assets other than their investments in the controlled operating companies. Investment company accounting prohibits the consolidation of any operating companies.
Previous wording
We seek to be a long-term investor with our portfolio companies. During the three months ended June 30, 2024 we acquired$88,016 of new investments, completed follow-on investments in existing portfolio companies totaling approximately$105,584, funded$9,083 of revolver advances, and recorded PIK interest of$39,457, resulting in gross investment originations of$242,140. During the three months ended June 30, 2024 we received full repayments totaling $143,249, received$6,980 in sales, received $1,211 of revolver paydowns, and received$93,304 in partial prepayments, scheduled principal amortization payments, and return of capital distributions, resulting in repayments of$238,245, net of $6,499 realized losses associated with such dispositions.
Current wording
We seek to be a long-term investor with our portfolio companies. During thethree months ended June 30, 2025 we acquired $181,383 of new investments, completed follow-on investments in existing portfolio companies totaling approximately $59,644, funded $12,500 of revolver advances, and recorded PIK interest of $17,332, resulting in gross investment originations of$270,859. During the three months ended June 30, 2025 we received full repayments totaling $53,000, received $315,601 in sales, received $4,563 of revolver paydowns, and received$72,162 in partial prepayments, scheduled principal amortization payments, and return of capital distributions, resulting in repayments of approximately $445,326.
Previous wording
During the three months ended June 30, 2024 we repaid $1,600 aggregate principal amount of Prospect Capital InterNotes® at par in accordance with the Survivor’s Option, as defined in the InterNotes® Offering prospectus. As a result of these transactions, we recorded a loss in the amount of the unamortized debt issuance costs. The net loss on the extinguishment of Prospect Capital InterNotes® in the three months ended June 30, 2024 was$36.
Current wording
During the three months ended June 30, 2025 we repaid$1,399 aggregate principal amount of Prospect Capital InterNotes® at par in accordance with the Survivor’s Option, as defined in the InterNotes® Offering prospectus. As a result of these transactions, we recorded aloss in the amount of the unamortized debt issuance costs. The netloss on the extinguishment of Prospect Capital InterNotes® in the three months ended June 30, 2025 was $32.
Previous wording
During the three months ended June 30, 2024 we issued$62,675 aggregate principal amount of Prospect Capital InterNotes® with a weighted average stated interest rate of 7.17%, to extend our borrowing base. The newly issued notes mature between April 15, 2027 and June 15, 2034 and generated net proceeds of$61,778.
Current wording
During the three months ended June 30, 2025 we issued$5,733 aggregate principal amount of Prospect Capital InterNotes® with a weighted average stated interest rate of 7.53%, to extend our borrowing base. The newly issued notes mature between April 15, 2028 and July 15, 2032 and generated net proceeds of$5,652.
Previous wording
On April 18, 2024, May 21, 2024 and June 18, 2024 we issued 620,679,555,569, and 567,060 shares of our common stock in connection with the dividend reinvestment plan, respectively.
Current wording
On April 17, 2025, May 20, 2025 and June 18, 2025 we issued 704,660, 672,278, and 733,322 shares of our common stock in connection with the dividend reinvestment plan, respectively.
Previous wording
During the three months ended June 30, 2024, 1,434,597 shares of our Series A1 Preferred Stock,39,934 shares of our Series A3 Preferred Stock,81,840 shares of our Series M1 Preferred Stock, and 71,473 shares of our Series M3 Preferred Stock were converted to 6,952,769 shares of our common stock, in connection with Holder Optional Conversions and Optional Redemptions Following Death of a Holder, resulting in a loss from redemption of preferred stock of $5,127.
Current wording
During the three months ended June 30, 2025, 675,943 shares of our Series A1 Preferred Stock, 220,408 shares of our Series A3 Preferred Stock, 61,732 shares of our Series M1 Preferred Stock, and 24,062 shares of our Series M3 Preferred Stock were converted to 6,448,188 shares of our common stock, in connection with Holder Optional Conversions and Optional Redemptions Following Death of a Holder, resulting in a loss from redemption of preferred stock of $1,762.
Previous wording
During the three months ended June 30, 2024 we issued 204,119 shares of our Series A3 Preferred Stock for net proceeds of$4,593,16,610 shares of our Series M3 Preferred Stock for net proceeds of $403, 2,184,866 shares of Series A4 Preferred Stock for net proceeds of$49,159, 272,138 shares of Series M4 Preferred Stock for net proceeds of$6,599, each excluding offering costs and preferred stock dividend reinvestment.
Current wording
During the three months ended June 30, 2025 we issued 616,374 shares of Series A5 Preferred Stock for net proceeds of$13,868, and 164,218 sharesof Series M5 Preferred Stock for net proceeds of$3,992, each excluding offering costs and preferred stock dividend reinvestment.
Previous wording
In connection with our Preferred Stock Dividend Reinvestment Plan, we issued additional Series A1 Preferred Stock, Series A3 Preferred Stock, Series M1 Preferred Stock, and Series M3 Preferred Stock of 12,938, 13,365, and 13,398 throughout April, May, and June, respectively.
Current wording
In connection with our Preferred Stock Dividend Reinvestment Plan, we issued additional Series A1 Preferred Stock, Series A3 Preferred Stock, Series A4 Preferred Stock, Series A5 Preferred Stock, Series M1 Preferred Stock, Series M3 Preferred Stock, Series M4 Preferred Stock, and Series M5 Preferred Stock of 13,720, 14,101, and 13,429 throughout April, May, and June, respectively.
Previous wording
At June 30, 2024, we have $7,718,243, or 207.9%, of our net assets applicable to common shares invested in 117 long-term portfolio investments and CLOs.
Current wording
At June 30, 2025, we have $6,673,516, or 223.3%, of our net assets applicable to common shares invested in 97 portfolio investments and CLOs.
Previous wording
Our annualized current yield was 12.1%and 13.3% as of June 30, 2024 and June 30, 2023, respectively, across all performing interest bearing investments, excluding equity investments and non-accrual loans. Our annualized current yield was 9.8%and 10.7% as of June 30, 2024 and June 30, 2023, respectively, across all investments. In many of our portfolio companies we hold equity positions, ranging from minority interests to majority stakes, which we expect over time to contribute to our investment returns. Some of these equity positions include features such as contractual minimum internal rates of returns, preferred distributions, flip structures and other features expected to generate additional investment returns, as well as contractual protections and preferences over junior equity, in addition to the yield and security offered by our cash flow and collateral debt protections.
Current wording
Our annualized current yield was 12.2% and 12.1% as of June 30, 2025 and June 30, 2024, respectively, across all performing interest bearing investments, excluding equity investments and non-accrual loans. Our annualized current yield was 9.6% and 9.8%as of June 30, 2025 and June 30, 2024, respectively, across all investments. In many of our portfolio companies we hold equity positions, ranging from minority interests to majority stakes, which we expect over time to contribute to our investment returns. Some of these equity positions include features such as contractual minimum internal rates of returns, preferred distributions, flip structures and other features expected to generate additional investment returns, as well as contractual protections and preferences over junior equity, in addition to the yield and security offered by our cash flow and collateral debt protections.
Previous wording
As of June 30, 2024, we own controlling interests in the following portfolio companies: CP Energy Services Inc. (“CP Energy”); Credit Central Loan Company, LLC (“Credit Central”); Echelon Transportation, LLC (“Echelon”); First Tower Finance Company LLC (“First Tower Finance”); Freedom Marine Solutions, LLC (“Freedom Marine”); InterDent, Inc. (“InterDent”); Kickapoo Ranch Pet Resort (“Kickapoo”); MITY, Inc. (“MITY”); NPRC; Nationwide Loan Company LLC (“Nationwide”); NMMB, Inc. (“NMMB”); Pacific World Corporation (“Pacific World”); R-V Industries, Inc. (“R-V”); Universal Turbine Parts, LLC (“UTP”); USES Corp. (“United States Environmental Services” or “USES”); and Valley Electric Company, Inc. (“Valley Electric”). In June 2019, CP Energy purchased a controlling interest of the common equity of Spartan Energy Holdings, Inc. (“Spartan Holdings”), which owns 100% of Spartan Energy Services, LLC (“Spartan”), a portfolio company of Prospect with $36,608 in senior secured term loans (the “Spartan Term Loan A”) due to us as of June 30, 2024. As a result of CP Energy’s purchase, and given Prospect’s controlling interest in CP Energy, we report our investments in Spartan as control investment. Spartan remains the direct borrower and guarantor to Prospect for the Spartan Term Loan A.
Current wording
As of June 30, 2025, we own controlling interests in the following portfolio companies: Belnick, LLC (Belnick); CP Energy Services Inc. (“CP Energy”); Credit Central Loan Company, LLC (“Credit Central”); Echelon Transportation, LLC (“Echelon”); First Tower Finance Company LLC (“First Tower Finance”); Freedom Marine Solutions, LLC (“Freedom Marine”); InterDent, Inc. (“InterDent”); Kickapoo Ranch Pet Resort (“Kickapoo”); MITY, Inc. (“MITY”); NPRC; Nationwide Loan Company LLC (“Nationwide”); NMMB, Inc. (“NMMB”); Pacific World Corporation (“Pacific World”); R-V Industries, Inc. (“R-V”); Universal Turbine Parts, LLC (“UTP”); USES Corp. (“United States Environmental Services” or “USES”); and Valley Electric Company, Inc. (“Valley Electric”). In June 2019, CP Energy purchased a controlling interest of the common equity of Spartan Energy Holdings, Inc. (“Spartan Holdings”), which owns 100% of Spartan Energy Services, LLC (“Spartan”), a portfolio company of Prospect with $51,477 and$41,177 in first lien term loans (the “Spartan Term Loan A”) due to us as of June 30, 2025 and June 30, 2024, respectively. As a result of CP Energy’s purchase, and given Prospect’s controlling interest in CP Energy, we report our investments in Spartan as control investment. Spartan remains the direct borrower and guarantor to Prospect for the Spartan Term Loan A.
Previous wording
(1)Participating Interest includes our participating equity investments, such as net profits interests, net operating income interests, net revenue interests, and overriding royalty interests.
Current wording
(1)Participating Interest includes our participating equity investments, such as net profits interests, net operating income interests, net revenue interests, revenue interests, liquidating trusts and overriding royalty interests.
Previous wording
The following shows our investments in interest bearing securities by type of investment as of June 30, 2024 and June 30, 2023:
Current wording
The following shows our investments in interest bearing securities, including non-accrual investments, by type of investment as of June 30, 2025 and June 30, 2024:
Previous wording
(1) Our SSN investments do not have industry concentrations and as such have been separated in the tables above. As of June 30, 2024 and June 30, 2023, Structured Finance includes$190,500 and $200,600, respectively, of senior secured term loan investments held through our investment in NPRC and its wholly-owned subsidiary related to its rated secured structured notes.
Current wording
(1) Our SSN investments do not have industry concentrations and as such have been separated in the tables above. As of June 30, 2025 and June 30, 2024, Structured Finance includes $0 and $190,500, respectively, of senior secured term loan investments held through our investment in NPRC and its wholly-owned subsidiary related to its rated secured structured notes.
Previous wording
(4) Weighted average interest rates for new investments by portfolio composition is calculated with the current rate at the end of the period. In addition, Revolving Line of Credit and Delayed Draw Term Loans are excluded from the calculation.
Current wording
(4) The annual weighted average interest rates for new investments by portfolio composition is calculated with the interest rate as of the respective quarter end date when the investment activity occurred. In addition, Revolving Line of Credit and Delayed Draw Term Loans are excluded from the calculation.
Previous wording
In determining the range of values for our investments in CLOs, the independent valuation firm uses a discounted multi-path cash flow model. The valuations were accomplished through the analysis of the CLO deal structures to identify the risk exposures from the modeling point of view as well as to determine an appropriate call date (i.e., expected maturity). These risk factors are sensitized in the multi-path cash flow model using Monte Carlo simulations, which are simulations used to model the probability of different outcomes, to generate probability-weighted (i.e., multi-path) cash flows for the underlying assets and liabilities. These cash flows are discounted using appropriate market discount rates, and relevant data in the CLO market and certain benchmark credit indices are considered, to determine the value of each CLO investment. In addition, we generate a single-path cash flow utilizing our best estimate of expected cash receipts, and assess the reasonableness of the implied discount rate that would be effective for the value derived from the corresponding multi-path cash flow model.
Current wording
In determining the range of values for our investments in CLOs, the independent valuation firm uses a discounted multi-path cash flow model. The valuations were accomplished through the analysis of the CLO deal structures to identify the risk exposures from the modeling point of view as well as to determine an appropriate call date (i.e., expected maturity). These risk factors are sensitized in the multi-path cash flow model using Monte Carlo simulations, which are simulations used to model the probability of different outcomes, to generate probability-weighted (i.e., multi-path) cash flows for the underlying assets and liabilities. These cash flows are discounted using appropriate market discount rates, and relevant data in the CLO market and certain benchmark credit indices are considered, to determine the value of each CLO investment. In addition, we generate a single-path cash flow utilizing our best estimate of expected cash receipts, and assess the reasonableness of the implied discount rate that would be effective for the value derived from the corresponding multi-path cash flow model. These investments are classified as Level 3 in the fair value hierarchy.
Previous wording
The Board of Directors looked at several factors in determining where within the range to value the asset including: recent operating and financial trends for the asset, independent ratings obtained from third parties, comparable multiples for recent sales of companies within the industry and discounted cash flow models for our investments in CLOs. The composite of all these various valuation techniques, applied to each investment, was a total valuation of $7,718,243.
Current wording
The Board of Directors looked at several factors in determining where within the range to value the asset including: recent operating and financial trends for the asset, independent ratings obtained from third parties, comparable multiples for recent sales of companies within the industry and discounted cash flow models for our investments in CLOs. The composite of all these various valuation techniques, applied to each investment, was a total valuation of$6,673,516.
Previous wording
Prospect owns 100% of the equity of CP Holdings, a Consolidated Holding Company. CP Holdings owns 99.8% of the equity of CP Energy, and the remaining equity is owned by CP Energy management. CP Energy provides oilfield flowback services and fluid hauling and disposal services through its subsidiaries.
Current wording
Prospect owns 100% of the equity of CP Holdings, a Consolidated Holding Company. CP Holdings owns 99.8% of the equity of CP Energy, and the remaining equity is owned by CP Energy management. CP Energy provides oilfield flow back services and fluid hauling and disposal services through its subsidiaries.
Previous wording
In June 2019, CP Energy purchased a controlling interest in the common equity of Spartan Energy Holdings, Inc. (“Spartan Holdings”), which owns 100% of Spartan Energy Services, LLC (“Spartan”) a portfolio company of Prospect with $35,103 in first lien term loans (the “Spartan Term Loans”) due to us as of June 30, 2024. As a result of CP Energy’s purchase, and given Prospect’s controlling interest in CP Energy, our Spartan Term Loans are presented as control investments under CP Energy beginning June 30, 2019. Spartan remains the direct borrower and guarantor to Prospect for the Spartan Term Loans. In September 2020, we made a new $26,193 Series A preferred stock investment in Spartan Energy Holdings, Inc., which equates to 100% of the Series A non-voting non-convertible preferred stock outstanding.
Current wording
In June 2019, CP Energy purchased a controlling interest in the common equity of Spartan Energy Holdings, Inc. (“Spartan Holdings”), which owns 100% of Spartan Energy Services, LLC (“Spartan”) a portfolio company of Prospect with $51,477 in first lien term loans (the “Spartan Term Loans”) due to us as of June 30, 2025. As a result of CP Energy’s purchase, and given Prospect’s controlling interest in CP Energy, our Spartan Term Loans are presented as control investments under CP Energy beginning June 30, 2019. Spartan remains the direct borrower and guarantor to Prospect for the Spartan Term Loans. In September 2020, we made a new $26,193 Series A preferred stock investment in Spartan Energy Holdings, Inc., which equates to 100% of the Series A non-voting non-convertible preferred stock outstanding.
Previous wording
The fair value of our investment in CP Energy decreased to $110,206 as of June 30, 2024, which is a discount of $188,641 from its amortized cost, compared to a fair value of $114,020 as of June 30, 2023, representing a discount of $164,948 to its amortized cost. The increase in discount to amortized cost resulted from increased debt in the capital structure and a revised forecast impacted by increased commodity prices in the industry.
Current wording
The fair value of our investment in CP Energy was $122,189 as of June 30, 2025, which is a discount of $202,132 from its amortized cost, compared to a fair value of $110,206 as of June 30, 2024, representing a discount of $188,641 to its amortized cost. The increase in discount to amortized cost primarily resulted from increased debt in the capital structure.
Previous wording
The fair value of our investment in First Tower was $605,928 as of June 30, 2024, representing a premium of $149,790 to its amortized cost basis compared to a fair value of $598,382 as of June 30, 2023, representing a premium of $171,310 to its amortized cost. The decrease in premium to amortized cost was driven by a decline in financial performance and increased debt in the capital structure.
Current wording
The fair value of our investment in First Tower was $760,518 as of June 30, 2025, a premium of $277,200 to its amortized cost basis compared to a fair value of $605,928 as of June 30, 2024, a premium of $149,790 to its amortized cost. The increase in premium to amortized cost resulted from an improvement in financial performance and an expansion of comparable company trading multiples.
Previous wording
The fair value of our investment in InterDent was $463,883 as of June 30, 2024, a premium of $102,337 to its amortized cost basis compared to a fair value of $457,967 as of June 30, 2023, a premium of $119,670 to its amortized cost. The decrease in premium to amortized cost resulted from increased debt in the capital structure.
Current wording
The fair value of our investment in InterDent was $338,781 as of June 30, 2025, a discount of $55,244 to its amortized cost basis compared to a fair value of $463,883 as of June 30, 2024, a premium of $102,337 to its amortized cost. The discount to amortized cost resulted from a decline in financial performance and increased debt in the capital structure.
Previous wording
During the year ended June 30, 2024, we provided $248,344 of debt financing and $4,600 of equity financing to NPRC to fund real estate capital expenditures, provide working capital, and to fund purchases of rated secured structured notes.
Current wording
During theyear ended June 30, 2024, we provided$248,344 of debt financing and$4,600 of equity financing to NPRC to fund real estate capital expenditures, provide working capital, and to fund purchases of rated secured structured notes.
Previous wording
During the year ended June 30, 2023, we received partial repayments of $109,352 of our loans previously outstanding with NPRC and its wholly owned subsidiaries and $4,000 as a return of capital on our equity investment in NPRC.
Current wording
During theyear ended June 30, 2024, we received partial repayments of$108,950 of our loans previously outstanding with NPRC and its wholly owned subsidiary.
Previous wording
As of June 30, 2024, investments held by certain of NPRC’s wholly-owned subsidiaries was comprised of residual interest in two securitizations valued at $2,647, one corporate bond valued at $18,058 and other assets valued at $1,249 for an aggregate fair value of $21,954.
Current wording
As of June 30, 2024, investments held by certain of NPRC’s wholly-owned subsidiaries was comprised of residual interest intwo securitizations valued at $2,647, one corporate bond valued at $18,058 and other assets valued at $1,249 for an aggregate fair value of $21,954.
Previous wording
As of June 30, 2024, our investment in NPRC and its wholly owned subsidiaries had an amortized cost of $1,108,311 and a fair value of $1,696,462. The fair value of $1,431,472 related to NPRC’s real estate portfolio was comprised of forty-nine multi-family properties, six student housing properties, four senior living properties, and two commercial properties. The following table shows the location, acquisition date, purchase price, and mortgage outstanding due to other parties for each of the properties held by NPRC as of June 30, 2024:
Current wording
As of June 30, 2024, our investment in NPRC and its wholly owned subsidiaries had an amortized cost of $1,108,311 and a fair value of$1,696,462. The fair value of $1,431,472 related to NPRC’s real estate portfolio was comprised offorty-nine multi-family properties, six student housing properties, four senior living properties, and two commercial properties. The following table shows the location, acquisition date, purchase price, and mortgage outstanding due to other parties for each of the properties held by NPRC as of June 30, 2024:
Previous wording
The fair value of our investment in NPRC was $1,696,462 as of June 30, 2024, a premium of $588,151 from its amortized cost basis, compared to a fair value of $1,659,976 as of June 30, 2023, representing a premium of $696,663. The decrease in premium is primarily driven by a rise in discount rates and terminal capitalization rates, decrease in market interest rates, and increased debt in the capital structure, offset by growth in the net operating income in our real estate portfolio.
Current wording
The fair value of our investment in NPRC was $1,300,972 as of June 30, 2025, a premium of $378,325 from its amortized cost basis, compared to a fair value of $1,696,462 as of June 30, 2024, representing a premium of $588,151. The decrease in premium to amortized cost was primarily driven by a decline in market interest rates, an increase in discount and terminal capitalization rates, and higher leverage within the capital structure. These effects were partially offset by growth in net operating income across our real estate portfolio. Additionally, the unwinding of the National General Lending Limited (“NGL”) and NMF portfolios resulted in debt repayments of $211,130 and a change in unrealized losses of $36,980.
Previous wording
The fair value of our investment in Nationwide decreased to $43,162 as of June 30, 2024, representing a discount of $10,253 to its amortized cost basis, compared to a fair value of $47,572 as of June 30, 2023, representing a premium of $4,129 to its amortized cost basis. The decrease in fair value was primarily driven by increased debt in the capital structure and reduction of comparable company trading multiples.
Current wording
The fair value of our investment in Nationwide was $36,780 as of June 30, 2025, a discount of $23,119 to its amortized cost compared to a fair value of $43,162 as of June 30, 2024, a discount of $10,253 to its amortized cost. The increase in discount to amortized cost resulted from a decline in financial performance.
Previous wording
The fair value of our investment in R-V increased to $102,402 as of June 30, 2024, representing a premium of $58,214 to its amortized cost basis, compared to a fair value of $81,508 as of June 30, 2023, representing a premium of $41,020 to its amortized cost basis. The increase in premium to amortized cost was driven primarily by an improvement in financial performance, due to the positive impact of two strategic acquisitions closed in the last year, and due to an expansion of comparable company trading multiples.
Current wording
The fair value of our investment in UTP was $102,728 as of June 30, 2025, a premium of $15,200 to its amortized cost compared to a fair value of $68,067 as of June 30, 2024, a premium of $432 to its amortized cost. The increase in premium to amortized cost was driven primarily by an improvement in financial outlook, due to the positive impact of a strategic acquisition that closed in the last year, and due to an expansion of comparable company trading multiples.
Previous wording
The fair value of our investment in Valley Electric increased to $316,419 as of June 30, 2024, a premium of $220,508 to its amortized cost, compared to a fair value of $165,784 as of June 30, 2023, representing a $74,636 premium to its amortized cost. The increase in premium to amortized cost was driven by an improvement in financial performance and expansion of comparable company trading multiples.
Current wording
The fair value of our investment in Valley Electric was $351,291 as of June 30, 2025, a premium of $255,379 to its amortized cost compared to a fair value of $316,419 as of June 30, 2024, a premium of $220,508 to its amortized cost. The increase in premium to amortized cost primarily resulted from an increase in financial performance and an expansion of comparable company trading multiples.
Previous wording
Our controlled investments, including those discussed above, are valued at $592,160 above their amortized cost as of June 30, 2024.
Current wording
Our controlled investments, including those discussed above, are valued at $280,123 above their amortized cost as of June 30, 2025.
Previous wording
We hold two affiliate investments at June 30, 2024 (Nixon, Inc. and RGIS Services, LLC, (“RGIS”)) with a total fair value of $18,069, a premium of $6,475 from their combined amortized cost, compared to a fair value as $10,397 of June 30, 2023, representing a $1,542 premium to its amortized cost. The increase in premium to amortized cost was driven by an improvement in RGIS’ financial performance.
Current wording
We hold two affiliate investments at June 30, 2025 (Nixon, Inc. and RGIS Services, LLC, (“RGIS”)) with a total fair value of $27,057, a premium of $15,322 from their combined amortized cost, compared to a fair value of $18,069 as of June 30, 2024, representing a $6,475 premium to its amortized cost. The increase in premium to amortized cost was driven by an improvement in RGIS’s financial performance.
Previous wording
With the non-control/non-affiliate investments, generally, there is less volatility related to our total investments because our equity positions tend to be smaller than with our control/affiliate investments, and debt investments are generally not as susceptible to large swings in value as equity investments. For debt investments, the fair value is generally limited on the high side to each loan’s par value, plus any prepayment premium that could be imposed. Note that three of our non-control/non- affiliate investments, Credit.com Holdings, LLC, Town & Country Holdings, Inc. (“Town & Country”), and our CLO investment portfolio, have larger equity positions and are therefore more susceptible to changes in value than the rest of our non-control/non-affiliate investments. As of June 30, 2024, our non-control/non-affiliate portfolio is valued at a discount to amortized cost primarily due to our CLO investment portfolio, which is valued at a$92,010 discount to amortized cost. Additionally, as of June 30, 2024, nine of our non-control/ non-affiliate investments, United Sporting Companies, Inc. (“USC”), Research Now Group, LLC and Dynata, LLC (collectively, “Research Now”), K&N HoldCo, LLC (“K&N”), Rising Tide Holdings, Inc. (“West Marine”), Credit.com Holdings, LLC, WellPath Holdings, Inc. (“WellPath”), Aventiv Technologies, LLC, Medical Solutions Holdings, Inc., and Reception Purchaser, LLC, are valued at discounts to amortized cost of $79,564, $48,533, $24,914, $19,968, $17,596, $14,113, $10,519, $9,457, and $7,983, respectively.
Current wording
With the non-control/non-affiliate investments, generally, there is less volatility related to our total investments because our equity positions tend to be smaller than with our control/affiliate investments, and debt investments are generally not as susceptible to large swings in value as equity investments. For debt investments, the fair value is generally limited on the high side to each loan’s par value, plus any prepayment premium that could be imposed. Note that seven of our non-control/non-affiliate investments, Credit.com Holdings, LLC, Discovery Point Retreat, Druid City Infusion, LLC, Taos Footwear, Town & Country Holdings, Inc. (“Town & Country”), Verify Diagnostics LLC, and our CLO investment portfolio, have larger equity or convertible debt option positions and are therefore more susceptible to changes in value than the rest of our non-control/non-affiliate investments. As of June 30, 2025, our non-control/non-affiliate portfolio is valued at a discount to amortized cost primarily due to nine of our non-control/ non-affiliate investments, United Sporting Companies, Inc. (“USC”), Credit.com Holdings, LLC (“Credit.com”), Aventiv Technologies, LLC (f/k/a Securus Technologies Holdings, Inc.) (“Aventiv”), Town & Country Holdings, Inc., Rising Tide Holdings, Inc. (“West Marine”), Medical Solutions Holdings Inc., K&N HoldCo, LLC (“K&N”), Redstone Holdco 2 LP (“RSA”), and STG Distribution, LLC (f/k/a Reception Purchaser, LLC) are valued at discounts to amortized cost of $73,412, $60,926, $58,603, $53,557, $26,162, $25,825, $25,190, $24,012, and $20,397, respectively.
Previous wording
Our largest non-control/non-affiliate investment is Town & Country, which is valued at$16,383 above its amortized cost and represents approximately 6.5%of our net asset value as of June 30, 2024. Town & Country is a supplier of home textiles and accessories to retailers throughout North America. Excluding those non-control/non-affiliate investments discussed above, our remaining non-control/non-affiliate portfolio is valued at a discount of $19,292 to amortized cost as of June 30, 2024.
Current wording
Excluding those non-control/non-affiliate investments discussed above, our remaining non-control/non-affiliate portfolio is valued at a premium of $55,492 to amortized cost as of June 30, 2025.
Previous wording
Our investment activities are capital intensive and the availability and cost of capital is a critical component of our business. We capitalize our business with a combination of debt and equity. Our debt as of June 30, 2024 consists of: a Revolving Credit Facility availing us of the ability to borrow debt subject to borrowing base determinations; Convertible Notes which we issued in March 2019; Public Notes which we issued in January 2021, May 2021 and September 2021; and Prospect Capital InterNotes® which we issue from time to time. As of June 30, 2024, our equity capital is comprised of common and preferred equity.
Current wording
Our investment activities are capital intensive and the availability and cost of capital is a critical component of our business. We capitalize our business with a combination of debt and equity. Our debt as of June 30, 2025 consists of: a Revolving Credit Facility availing us of the ability to borrow debt subject to borrowing base determinations; Public Notes which we issued in May 2021 and September 2021; and Prospect Capital InterNotes® which we issue from time to time. As of June 30, 2025, our equity capital is comprised of common and preferred equity.
Previous wording
The following table shows the contractual maturities by fiscal year of our Revolving Credit Facility, Convertible Notes, Public Notes and Prospect Capital InterNotes® as of June 30, 2024:
Current wording
The following table shows the contractual maturities by fiscal year of our Revolving Credit Facility, Public Notes and Prospect Capital InterNotes® as of June 30, 2025:
Previous wording
On May 15, 2007, we formed our wholly owned subsidiary, PCF, a Delaware limited liability company and a bankruptcy remote special purpose entity, which holds certain of our portfolio loan investments that are used as collateral for the revolving credit facility at PCF. Since origination of the revolving credit facility, we have renegotiated the terms and extended the commitments of the revolving credit facility several times. Most recently, effective June 28, 2024, we completed an extension and upsizing of the revolving credit facility (the “Revolving Credit Facility”). The lenders have extended commitments of $2,066,500 as of June 30, 2024. The Revolving Credit Facility includes an accordion feature which allows commitments to be increased up to $2,250,000 in the aggregate. The extension and upsizing of the Revolving Credit Facility extended the maturity date to June 28, 2029 andthe revolving period through June 28, 2028, foll owed by an additional one-year amortization period, with distributions allowed to Prospect after the completion of the revolving period. During such one-year amortization period, all principal payments on the pledged assets will be applied to reduce the balance. At the end of the one-year amortization period, the remaining balance will become due.
Current wording
On May 15, 2007, we formed our wholly owned subsidiary, PCF, a Delaware limited liability company and a bankruptcy remote special purpose entity, which holds certain of our portfolio loan investments that are used as collateral for the revolving credit facility at PCF. Since origination of the revolving credit facility, we have renegotiated the terms and extended the commitments of the revolving credit facility several times. Most recently, effective June 28, 2024, we completed an extension and upsizing of the revolving credit facility (the “Revolving Credit Facility”). The lenders have extended commitments of $2,121,500 as of June 30, 2025. The Revolving Credit Facility includes an accordion feature which allows commitments to be increased up to $2,250,000 in the aggregate. The extension and upsizing of the Revolving Credit Facility extended the maturity date to June 28, 2029 andthe revolving period through June 28, 2028, foll owed by an additional one-year amortization period, with distributions allowed to Prospect after the completion of the revolving period. During such one-year amortization period, all principal payments on the pledged assets will be applied to reduce the balance. At the end of the one-year amortization period, the remaining balance will become due.
Showing the first 40 of 89 pairs. Open the source sections for the rest.
Rearranged current paragraphs (12)
Current report — wording carried from elsewhere
As of June 30, 2025, our investment in NPRC and its wholly owned subsidiaries had an amortized cost of $922,647 and a fair value of $1,300,972. The fair value of $1,289,092 related to NPRC’s real estate portfolio was comprised of forty-seven multi-family properties, five student housing properties, four senior living properties, and two commercial properties. The following table shows the location, acquisition date, purchase price, and mortgage outstanding due to other parties for each of the properties held by NPRC as of June 30, 2025:
Current report — wording carried from elsewhere
Had Prospect Administration not received these payments during the years ended June 30, 2025 and 2024, Prospect Administration’s charges for its administrative services during the respective period would have increased by this amount.
Current report — wording carried from elsewhere
During the year ended June 30, 2025, we recorded a net realized loss of $15,079 from the accretion to redemption value of redeemable securities. During theyear ended June 30, 2024, we recorded a net realized loss of $12,156 from the accretion to redemption value of redeemable securities.
Current report — wording carried from elsewhere
Shares of the Floating Rate Preferred Stock and 7.50% Preferred Stock are redeemable, at the option of the holder of such Floating Rate Preferred Stock and 7.50% Preferred Stock, on a monthly basis (the “Holder Optional Redemption”). For all shares of Floating Rate Preferred Stock and 7.50% Preferred Stock duly submitted for redemption on or before a monthly Holder Redemption Deadline (defined in the prospectus supplement dated December 29, 2023), the HOR Settlement Amount (as defined below) is determined on any business day after such Holder Redemption Deadline but before the Holder Redemption Deadline occurring two months thereafter (such date, the “Holder Redemption Exercise Date”). Within such period, we may select the Holder Redemption Exercise Date in our sole discretion. We will settle any Holder Optional Redemption by paying the HOR Settlement Amount in cash.
Current report — wording carried from elsewhere
The aggregate amount of Holder Optional Redemptions by the holders of 7.50% Preferred Stock is subject to the following redemption limits: (i) no more than 2% of the outstanding 7.50% Preferred Stock, in aggregate, as of the end of the most recent fiscal quarter will be redeemed per calendar month; (ii) no more than 5% of the outstanding 7.50% Preferred Stock, in aggregate, as of the end of the most recent fiscal quarter will be redeemed per fiscal quarter; and (iii) no more than 20% of the outstanding 7.50% Preferred Stock, in aggregate, as of the end of the most recent fiscal quarter will be redeemed per Annual Redemption Period; plus, for each redemption limit set forth above in clauses (i) through (iii) of this paragraph, an amount of such 7.50% Preferred Stock equal to the lowest excess, if any, between the corresponding applicable 2% / 5% / 20% redemption limits for Floating Rate Preferred Stock as set forth above and the respective amounts requested for the Floating Rate Preferred Stock on a Holder Redemption Deadline for the Floating Rate Preferred Stock.
Current report — wording carried from elsewhere
Redemption capacity of the 7.50% Preferred Stock will be allocated on a pro rata basis based on the number of 7.50% Preferred Stock, as applicable, submitted in the event that a monthly redemption is oversubscribed based on any of the foregoing redemption limits.
Current report — wording carried from elsewhere
An “Annual Redemption Period” means our then current fiscal quarter and the three fiscal quarters immediately preceding our then current fiscal quarter. Shares of Series A4 Preferred Stock and Series A5 Preferred Stock are subject to an early redemption fee if it is redeemed by its holder within five years of issuance. We may waive the foregoing redemption limits in our sole discretion at any time.
Current report — wording carried from elsewhere
Subject to certain limitations, each share of 5.50% Preferred Stock or 6.50% Preferred Stock may be converted at our option (the “Issuer Optional Conversion”). We will settle any Issuer Optional Conversion by paying or delivering, as the case may be, (A) any portion of the IOC Settlement Amount (as defined below) that we elect to pay in cash and (B) a number of shares of our common stock at a conversion rate equal to (1) (a) the IOC Settlement Amount, minus (b) any portion of the IOC
Current report — wording carried from elsewhere
During the year ended June 30, 2025, we did not repurchase shares of Series A Preferred Stock.
Current report — wording carried from elsewhere
During the year ended June 30, 2025, we exchanged an aggregate of 195,938 Series M1 Preferred Stock for an aggregate of 10,842, 142,054, and 43,040 newly-issued Series M3 Preferred Stock, Series M4 Preferred Stock, and Series M5 Preferred Stock, respectively. Additionally, during the year ended June 30, 2025, we exchanged an aggregate of 294,040 Series M3 Preferred Stock for an aggregate of 266,878 and 27,160 newly-issued Series M4 Preferred Stock and newly-issued Series M5 Preferred Stock, respectively, pursuant to Section 3(a)(9) of the Securities Act.
Current report — wording carried from elsewhere
The Series M3 Preferred Stock, Series M4 Preferred Stock and Series M5 Preferred Stock issued in the exchanges were issued in each case to an existing security holder of the Company exclusively in exchange for such holder’s securities. No commission or other remuneration was paid or given for soliciting the exchange. Stockholders who exchange Series M1 Preferred Stock for Series M3 Preferred Stock or Series M4 Preferred Stock or Series M3 Preferred Stock for Series M4 Preferred Stock or Series M5 Preferred Stock will receive unpaid dividends on their Series M1 Preferred Stock or Series M3 Preferred Stock accrued to, but not including, the Exchange Exercise Date, plus any fractional amount of a Series M1 Preferred Stock or Series M3 Preferred Stock exchanged multiplied by $25.00 in cash. Upon settlement, the carrying amount (including any premiums or discounts and a proportional amount of any issuance costs) of the Series M1 Preferred Stock or Series M3 Preferred Stock are reclassified to Series M3 Preferred Stock, Series M4 Preferred Stock or Series M5 Preferred Stock, respectively, with no gain or loss recognized.
Current report — wording carried from elsewhere
Series A Preferred Stock held by such holder on the Change of Control Conversion Date into a number of our shares of common stock per Series A Preferred Stock to be converted equal to the lesser of:
Rearranged previous paragraphs (4)
Previous report — wording carried elsewhere
During the year ended June 30, 2023, we provided $209,381 of debt financing and $3,600 of equity financing to NPRC to fund capital expenditures for existing real estate properties, to provide working capital, and to fund purchases of rated secured structured notes.
Previous report — wording carried elsewhere
During the year ended June 30, 2024, our net asset value applicable to common shares decreased by $20,932, or $0.50 per common share.
Previous report — wording carried elsewhere
The Series A Preferred Stock ranks (with respect to the payment of dividends and rights upon liquidation, dissolution or winding up) (a) senior to our common stock, (b) on parity with each other series of our preferred stock, and (c) junior to our existing and future secured and unsecured indebtedness. See Note 8, Fair Value and Maturity of Debt Outstanding for further discussion on our senior securities.
Previous report — wording carried elsewhere
During the year ended June 30, 2023, we repurchased 37,346 shares of Series A Preferred Stock for a total cost of approximately $579, including fees and commissions paid to the broker, representing an average repurchase price of $15.42 per share. The difference in the consideration transferred and the net carrying value of the Series A Preferred Stock repurchased, which was $900, resulted in a gain applicable to common stock holders of approximately $321 during the year ended June 30, 2023. The repurchased shares reverted to authorized but unissued shares of Series A Preferred Stock and thus the Company holds no treasury stock.