•]`
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
☒
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2025
OR
☐
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM TO
COMMISSION FILE NUMBER: 814-00736
PENNANTPARK INVESTMENT CORPORATION
(Exact name of registrant as specified in its charter)
MARYLAND
20-8250744
(State or other jurisdiction of incorporation or organization)
(I.R.S. Employer Identification No.)
1691 Michigan Avenue,
Miami Beach, Florida
33139
(Address of principal executive offices)
(Zip Code)
(786) 297-9500
(Registrant’s Telephone Number, Including Area Code)
None
(Former name, former address and former fiscal year, if changed since last report)
Securities registered pursuant to Section 12(b) of the Act:
Title of Each Class
Trading Symbol(s)
Name of Each Exchange on Which Registered
Common Stock, par value $0.001 per share
PNNT
The New York Stock Exchange
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer
Accelerated filer
☑
Non-accelerated filer
Smaller reporting company
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☐
The number of shares of the registrant’s common stock, $0.001 par value per share, outstanding as of August 11, 2025 was 65,296,094.
FORM 10-Q FOR THE QUARTER ENDED JUNE 30, 2025
TABLE OF CONTENTS
PART I. CONSOLIDATED FINANCIAL INFORMATION
Item 1. Consolidated Financial Statements
Consolidated Statements of Assets and Liabilities as of June 30, 2025 (unaudited) and September 30, 2024
4
Consolidated Statements of Operations for the three and nine months ended June 30, 2025 and 2024 (unaudited)
5
Consolidated Statements of Changes in Net Assets for the three and nine months ended June 30, 2025 and 2024 (unaudited)
6
Consolidated Statements of Cash Flows for the nine months ended June 30, 2025 and 2024 (unaudited)
7
Consolidated Schedules of Investments as of June 30, 2025 (unaudited) and September 30, 2024
8
Notes to Consolidated Financial Statements (unaudited)
27
Report of Independent Registered Public Accounting Firm (PCAOB ID 49)
47
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
49
Item 3. Quantitative and Qualitative Disclosures About Market Risk
65
Item 4. Controls and Procedures
66
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
67
Item 1A. Risk Factors
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Item 3. Defaults Upon Senior Securities
Item 4. Mine Safety Disclosures
Item 5. Other Information
Item 6. Exhibits
68
SIGNATURES
69
2
PART I—CONSOLIDATED FINANCIAL INFORMATION
We are filing this Quarterly Report on Form 10-Q (the "Report"), in compliance with Rule 13a-13 as promulgated by the Securities and Exchange Commission, or the SEC, under the Securities Exchange Act of 1934, as amended, or the Exchange Act. In this Report, except where context suggest otherwise, the terms “Company,” “we,” “our” or “us” refers to PennantPark Investment Corporation and its consolidated subsidiaries; “PennantPark Investment” refers to only PennantPark Investment Corporation; “Funding I” refers to PennantPark Investment Funding I, LLC, a wholly-owned subsidiary prior to deconsolidation on July 31, 2020; “Taxable Subsidiary” refers collectively to our consolidated subsidiaries, PNNT Investment Holdings II, LLC and PNNT Investment Holdings, LLC; “PSLF” refers to PennantPark Senior Loan Fund, LLC, an unconsolidated joint venture; “PTSF II” refers to PennantPark-TSO Senior Loan Fund II, LP, an unconsolidated limited partnership; “PennantPark Investment Advisers” or “Investment Adviser” refers to PennantPark Investment Advisers, LLC; “PennantPark Investment Administration” or “Administrator” refers to PennantPark Investment Administration, LLC; “BNP Credit Facility” refers to our revolving credit facility with BNP Paribas prior to deconsolidation of Funding I; “Truist Credit Facility” refers to our multi-currency, senior secured revolving credit facility with Truist Bank, as amended and restated; “2026 Notes” refers to our 4.50% Notes due May 2026; “2026 Notes-2” refers to our 4.00% Notes due November 2026; “BDC” refers to a business development company under the Investment Company Act of 1940, as amended, or the “1940 Act”; “Code” refers to the Internal Revenue Code of 1986, as amended; and “RIC” refers to a regulated investment company under the Code. References to our portfolio, our investments and our business include investments we make through consolidated subsidiaries.
3
PENNANTPARK INVESTMENT CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES
(In thousands, except share and per share data)
June 30, 2025
September 30, 2024
(unaudited)
Assets
Investments at fair value
Non-controlled, non-affiliated investments (amortized cost—$723,149 and $916,168, respectively)
$
729,787
910,323
Non-controlled, affiliated investments (amortized cost—$58,443 and $56,734, respectively)
7,484
33,423
Controlled, affiliated investments (amortized cost—$349,671 and $343,970, respectively)
434,353
384,304
Total investments (amortized cost—$1,131,263 and $1,316,872, respectively)
1,171,624
1,328,050
Cash and cash equivalents (cost—$70,408 and $49,833, respectively)
70,546
49,861
Interest receivable
4,600
5,261
Distribution receivable
5,832
5,417
Due from affiliates
90
228
Prepaid expenses and other assets
196
269
Total assets
1,252,888
1,389,086
Liabilities
Truist Credit Facility payable, at fair value (cost—$316,456 and $461,456, respectively)
316,384
460,361
2026 Notes payable (par— $150,000, unamortized deferred financing cost of $753 and $1,429, respectively)
149,247
148,571
2026 Notes-2 payable (par— $165,000, unamortized deferred financing cost of $1,280 and $1,920, respectively)
163,720
163,080
Payable for investment purchased
124,720
100,096
Interest payable on debt
2,919
6,406
Distributions payable
5,224
Base management fee payable
3,889
4,297
Accounts payable and accrued expenses
3,698
4,053
Incentive fee payable
2,502
3,057
Due to affiliate
—
33
Total liabilities
772,303
895,178
Commitments and contingencies (See Note 11)
Net assets
Common stock, 65,296,094 and 65,296,094 shares issued and outstanding, respectively Par value $0.001 per share and 200,000,000 shares authorized
Paid-in capital in excess of par value
743,968
Accumulated deficit
(263,448
)
(250,125
Total net assets
480,585
493,908
Total liabilities and net assets
Net asset value per share
7.36
7.56
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
(In thousands, except per share data)
Three Months Ended June 30,
Nine Months Ended June 30,
2025
2024
Investment income:
From non-controlled, non-affiliated investments:
Interest
12,659
17,383
46,411
61,353
Payment-in-kind
1,569
1,904
4,554
2,093
Dividend income
560
977
1,566
2,292
Other income
617
392
1,319
2,595
From non-controlled, affiliated investments:
347
From controlled, affiliated investments:
8,217
7,966
23,360
19,389
355
995
1,178
2,484
5,578
7,387
16,008
16,765
Total investment income
29,555
37,004
94,423
107,318
Expenses:
Interest and expenses on debt
9,196
11,482
31,254
32,906
Base management fee
4,216
12,174
12,357
Incentive fee
3,345
7,682
9,684
General and administrative expenses
1,050
1,030
3,450
3,623
Administrative services expenses
450
1,400
1,189
Expenses before amendment costs, debt issuance costs and provision for taxes
17,087
20,523
55,960
59,759
Provision for taxes on net investment income
670
735
1,920
1,902
Credit facility amendment and debt issuance costs
324
Net expenses
17,757
21,258
58,204
61,661
Net investment income
11,798
15,746
36,219
45,657
Realized and unrealized gain (loss) on investments and debt:
Net realized gain (loss) on investments and debt:
Non-controlled, non-affiliated investments
(475
(1,590
(30,749
(444
Non-controlled and controlled, affiliated investments
(5,305
(35,474
Provision for taxes on realized gain on investments
(1
(50
(177
Net realized gain (loss) on investments and debt
(476
(6,895
(30,799
(36,095
Net change in unrealized appreciation (depreciation) on:
(547
(1,614
12,594
(15,412
(3,483
16,699
38,592
Provision for taxes on unrealized appreciation (depreciation) on investments
(680
Debt appreciation (depreciation)
(2,972
(8
(1,023
(1,578
Net change in unrealized appreciation (depreciation) on investments and debt
(3,172
(5,105
28,270
20,922
Net realized and unrealized gain (loss) from investments and debt
(3,648
(12,000
(2,529
(15,173
Net increase (decrease) in net assets resulting from operations
8,150
3,746
33,690
30,484
Net increase (decrease) in net assets resulting from operations per common share
0.12
0.06
0.52
0.47
Net investment income per common share
0.18
0.24
0.55
0.70
CONSOLIDATED STATEMENTS OF CHANGES IN NET ASSETS (Unaudited)
(In thousands, except share data)
Net increase (decrease) in net assets resulting from operations:
(35,918
Net change in unrealized appreciation (depreciation) on investments
(200
(5,097
29,293
23,180
Net change in provision for taxes on net realized gain (loss) on investments
Net change in provision for taxes on unrealized appreciation (depreciation) on investments
Net change in unrealized appreciation (depreciation) on debt
Distributions to stockholders:
Distribution of net investment income
(15,671
(14,355
(47,013
(41,751
Total distributions to stockholders
Capital Transactions:
Public offering
552
Offering costs
(250
Net increase in net assets resulting from capital transactions
302
Net increase (decrease) in net assets
(7,521
(10,307
(13,323
(10,965
Net assets:
Beginning of period
488,106
501,529
502,187
End of period
491,222
Capital share activity:
Shares issued from public offering
71,594
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
(In thousands)
Cash flows from operating activities:
Adjustments to reconcile net increase (decrease) in net assets resulting from operations to net cash provided by (used in) operating activities:
Net change in net unrealized (appreciation) depreciation on investments
(29,293
(23,180
1,023
1,578
Net realized (gain) loss on investments
30,749
35,918
Net accretion of discount and amortization of premium
(3,144
(2,102
Purchases of investments
(908,102
(752,062
Payment-in-kind income
(5,732
(4,924
Proceeds from dispositions of investments
1,071,812
589,390
Amortization of deferred financing costs
1,316
(Increase) decrease in:
661
1,252
(415
(2,885
Due from affiliate
138
(139
73
3,386
Increase (decrease) in:
(33
(4,066
Payable for investments purchased
24,624
(35,398
(3,487
(3,107
Base management fee payable, net
(408
301
(555
35
(355
(3,536
Net cash provided by (used in) operating activities
212,562
(167,739
Cash flows from financing activities:
Proceeds from public offering
Distributions paid to stockholders
(47,014
(50,222
Borrowings under Truist Credit Facility
97,000
423,036
Repayments under Truist Credit Facility
(242,000
(185,000
Net cash provided by (used in) financing activities
(192,014
188,116
Net increase (decrease) in cash equivalents
20,548
20,377
Effect of exchange rate changes on cash
137
Cash and cash equivalents, beginning of period
38,775
Cash and cash equivalents, end of period
59,152
Supplemental disclosure of cash flow information:
Interest paid
33,425
34,697
Taxes paid
2,850
6,308
Non-cash exchanges and conversions
23,229
28,835
Non-cash purchases and disposition of investments
26,250
CONSOLIDATED SCHEDULE OF INVESTMENTS (Unaudited)
JUNE 30, 2025
Issuer Name
Maturity
Industry
Current Coupon
Basis Point Spread Above Index (4)
Par / Shares
Cost
Fair Value (3)
Investments in Non-Controlled, Non-Affiliated Portfolio Companies - 151.9% (1), (2)
First Lien Secured Debt - 84.3% of Net Assets
A1 Garage Merger Sub, LLC - Unfunded Revolver (7)
12/22/2028
Personal, Food and Miscellaneous Services
2,532
-
ACP Avenu Buyer, LLC
10/02/2029
Business Services
9.03
%
3M SOFR+475
5,930
5,886
5,871
ACP Avenu Buyer, LLC - Unfunded Term Loan (7)
04/21/2027
3,479
(17
ACP Avenu Buyer, LLC - Unfunded Revolver (7)
2,436
(24
ACP Falcon Buyer, Inc. - Unfunded Revolver (7)
08/01/2029
2,533
Ad.net Acquisition, LLC - Funded Revolver
05/07/2026
Media
10.56
3M SOFR+626
292
Ad.net Acquisition, LLC - Unfunded Revolver (7)
152
Adweek Purchaser, LLC
05/30/2027
Printing and Publishing
11.30
3M SOFR+700
2,000
1,972
Adweek Purchaser, LLC - Unfunded Term Loan (7)
11/30/2025
400
Aechelon Technology, Inc.
08/16/2029
Aerospace and Defense
10.83
3M SOFR+650
11,760
11,653
Aechelon Technology, Inc. - Unfunded Revolver (7)
2,724
AFC Dell Holding Corp.
04/09/2027
Distribution
9.83
3M SOFR+550
AFC Dell Holding Corp. - Unfunded Term Loan (7)
4,428
(22
Atlas Purchaser, Inc. - Third Out (10)
05/06/2028
Telecommunications
8,840
7,706
3,492
Atlas Purchaser, Inc. - Fourth Out (10)
4,760
794
262
Anteriad, LLC (f/k/a MeritDirect, LLC) - Funded Revolver
06/30/2026
10.20
3M SOFR+590
691
Anteriad, LLC (f/k/a MeritDirect, LLC) - Unfunded Revolver (7)
921
Arcfield Acquisition Corp. - Unfunded Revolver (7)
10/28/2031
1,688
Archer Lewis, LLC - Unfunded Term Loan B (7)
08/28/2026
Healthcare, Education and Childcare
6,821
Archer Lewis, LLC - Unfunded Revolver (7)
08/28/2029
1,304
Argano, LLC.
09/13/2029
10.07
3M SOFR+575
10,461
10,359
10,366
Argano, LLC. - Unfunded Term Loan (7)
10/02/2026
2,483
Argano, LLC. - Unfunded Revolver (7)
(7
Azureon, LLC
06/26/2029
Diversified Conglomerate Service
10.05
9,835
9,728
9,609
Azureon, LLC - Funded Revolver
464
453
Azureon, LLC - Unfunded Revolver (7)
696
(16
Beacon Behavioral Support Service, LLC - Unfunded Term Loan (7)
12/22/2025
3,838
Beacon Behavioral Support Service, LLC - Funded Revolver
06/21/2029
9.80
782
774
Beacon Behavioral Support Service, LLC - Unfunded Revolver (7)
261
(3
Berwick Industrial Park
08/02/2025
Buildings and Real Estate
13.00
4,000
4,006
3,920
Best Practice Associates, LLC - Unfunded Revolver (7)
11/08/2029
1,929
Beta Plus Technologies, Inc.
07/02/2029
4,863
4,804
4,753
Big Top Holdings, LLC - Unfunded Revolver (7)
02/28/2030
Manufacturing/Basic Industry
1,155
BioDerm, Inc. - Funded Revolver
01/31/2028
10.82
1,071
1,058
Blackhawk Industrial Distribution, Inc.
09/17/2026
9.72
3M SOFR+540
1,270
1,265
1,254
Blackhawk Industrial Distribution, Inc. - Funded Revolver
9.70
2,671
2,638
Blackhawk Industrial Distribution, Inc. - Unfunded Revolver (7)
2,186
(27
BLC Holding Company, Inc. - Unfunded Term Loan (7)
11/20/2026
9,768
BLC Holding Company, Inc. - Unfunded Revolver (7)
11/20/2030
3,005
Boss Industries, LLC - Unfunded Revolver (7)
12/27/2030
Conglomerate Manufacturing
1,306
CONSOLIDATED SCHEDULE OF INVESTMENTS (Unaudited) —(Continued)
Capital Construction, LLC
10/22/2026
Consumer Services
3,659
3,631
Capital Construction, LLC - Unfunded Term Loan A (7)
07/31/2025
1,950
Capital Construction, LLC - Unfunded Term Loan B (7)
12/30/2025
6,613
Carisk Buyer, Inc. - Unfunded Term Loan (7)
12/03/2029
4,813
48
Carisk Buyer, Inc. - Unfunded Term Loan 2 (7)
1,528
11
Carisk Buyer, Inc. - Unfunded Revolver (7)
1,750
Carnegie Dartlet, LLC
02/07/2030
Education
2,331
2,309
2,308
Carnegie Dartlet, LLC - Unfunded Term Loan (7)
02/09/2026
7,680
Carnegie Dartlet, LLC - Unfunded Revolver (7)
3,339
Cartessa Aesthetics, LLC
06/14/2028
10.30
3M SOFR+600
23,555
23,281
Cartessa Aesthetics, LLC - Funded Revolver
Cartessa Aesthetics, LLC - Unfunded Revolver (7)
2,297
Case Works, LLC - Unfunded Term Loan (7)
10/01/2025
852
(12
Case Works, LLC - Funded Revolver
10/01/2029
9.55
3M SOFR+525
1,415
1,383
Case Works, LLC - Unfunded Revolver (7)
472
(11
CF512, Inc. - Funded Revolver
08/20/2026
10.60
3M SOFR+627
82
81
CF512, Inc. - Unfunded Revolver (7)
827
CJX Borrower, LLC
07/13/2027
9.97
3M SOFR+576
285
278
CJX Borrower, LLC - Unfunded Term Loan (7)
185
34
CJX Borrower, LLC - Funded Revolver
818
CJX Borrower, LLC - Unfunded Revolver (7)
1,057
Compex Legal Services, Inc. - Funded Revolver
02/07/2026
9.78
3M SOFR+555
393
Compex Legal Services, Inc. - Unfunded Revolver (7)
Cornerstone Advisors of Arizona, LLC
05/13/2032
Consulting Services
9.05
6,000
5,970
Cornerstone Advisors of Arizona, LLC - Unfunded Revolver (7)
797
(4
Commercial Fire Protection Holdings, LLC - Unfunded Term Loan (7)
09/23/2026
6,630
50
Commercial Fire Protection Holdings, LLC - Unfunded Revolver (7)
09/23/2030
2,486
Crane 1 Services, Inc. - Unfunded Revolver (7)
08/16/2027
435
C5MI Acquisition, LLC
07/31/2029
2,469
2,437
C5MI Acquisition, LLC - Funded Revolver
10.33
964
C5MI Acquisition, LLC - Unfunded Revolver (7)
3,169
Dr. Squatch, LLC - Unfunded Revolver (7)
08/31/2027
2,326
DRS Holdings III, Inc.
11/03/2025
Consumer Products
9.57
DRS Holdings III, Inc. - Unfunded Revolver (7)
608
Duggal Acquisition, LLC - Unfunded Term Loan (7)
09/30/2026
Marketing Services
2,042
20
Duggal Acquisition, LLC - Unfunded Revolver (7)
09/30/2030
2,561
Dynata, LLC - Last-Out Term Loan
10/16/2028
10.09
84
EDS Buyer, LLC - Unfunded Revolver (7)
1,915
Emergency Care Partners, LLC - Unfunded Term Loan (7)
10/19/2026
2,185
Emergency Care Partners, LLC - Unfunded Revolver (7)
10/18/2027
641
ENC Parent Corporation
08/20/2029
8.81
3M SOFR+451
3,391
3,041
2,882
ETE Intermediate II, LLC
05/29/2029
9.58
553
550
ETE Intermediate II, LLC - Funded Revolver
05/25/2029
166
ETE Intermediate II, LLC - Unfunded Revolver (7)
2,264
Eval Home Health Solutions Intermediate, LLC - Unfunded Revolver (7)
05/10/2030
822
Exigo Intermediate II, LLC
03/15/2027
10.68
3M SOFR+635
23,940
23,787
Exigo Intermediate II, LLC - Unfunded Revolver (7)
1,856
Express Wash Intermediate, LLC
04/10/2031
Auto Sector
10.46
3M SOFR+625
10,000
9,952
9,940
Express Wash Intermediate, LLC - Unfunded Revolver (7)
609
First Medical Associates
06/13/2031
4,500
4,455
First Medical Associates - Unfunded Term Loan (7)
06/13/2027
3,000
First Medical Associates - Unfunded Revolver (7)
600
Five Star Buyer, Inc.
02/23/2028
Leisure, Amusement, Motion Pictures, Entertainment
11.46
3M SOFR+715
197
193
(PIK 1.00%)
Five Star Buyer, Inc. - Unfunded Revolver (7)
370
9
CONSOLIDATED SCHEDULE OF INVESTMENTS (Unaudited)—(Continued)
Gauge ETE Blocker, LLC - Promissory Note
05/21/2029
PIK 12.56%
277
GGG MIDCO, LLC
09/27/2030
Home and Office Furnishings, Housewares and Durable Consumer Products
9.32
3M SOFR+500
6,175
6,116
GGG MIDCO, LLC - Unfunded Term Loan (7)
09/27/2026
4,111
41
GGG MIDCO, LLC - Unfunded Revolver (7)
581
Graffiti Buyer, Inc.
08/10/2027
9.92
3M SOFR+560
246
244
241
Graffiti Buyer, Inc. - Unfunded Term Loan (7)
831
(10
Graffiti Buyer, Inc. - Unfunded Revolver (7)
769
(15
Halo Buyer, Inc.
08/07/2029
16,958
16,800
16,449
Halo Buyer, Inc. - Funded Revolver
12.50
495
Halo Buyer, Inc. - Unfunded Revolver (7)
2,203
(135
Hancock Roofing and Construction L.L.C.
12/31/2026
Insurance
9.93
750
746
Harris & Co. LLC
08/09/2030
Financial Services
9.33
8,457
8,385
Harris & Co. LLC - Unfunded Term Loan B (7)
7,461
Harris & Co. LLC - Unfunded Revolver (7)
4,529
Hills Distribution, Inc.
10.32
7,805
7,737
Hills Distribution, Inc. - Unfunded Term Loan (7)
11/07/2025
1,280
13
HV Watterson Holdings, LLC
12/17/2026
12.00
288
287
181
(PIK 4.00%)
HV Watterson Holdings, LLC - Funded Revolver
1,250
785
HV Watterson Holdings, LLC - Unfunded Revolver (7)
HW Holdco, LLC - Unfunded Revolver (7)
05/11/2026
3,387
IG Investment Holdings LLC
09/22/2028
9.28
104
103
IG Investments Holdings, LLC - Unfunded Revolver (7)
722
(5
Imagine Acquisitionco, LLC - Unfunded Revolver (7)
11/16/2027
1,685
Impact Advisors, LLC
03/19/2032
7,980
7,941
7,940
Impact Advisors, LLC - Unfunded Term Loan (7)
03/21/2027
4,686
Impact Advisors, LLC - Unfunded Revolver (7)
937
Infinity Home Services Holdco, Inc.
12/28/2028
8,997
8,902
Infinity Home Services Holdco, Inc. (CAD)
CAD 2,619
1,891
1,919
Infinity Home Services Holdco, Inc. - 3rd Amendment Unfunded Term Loan (7)
10/30/2026
9,091
(45
Infinity Home Services Holdco, Inc. - Funded Revolver
323
Infinity Home Services Holdco, Inc. - Unfunded Revolver (7)
969
Inovex Information Systems Incorporated - Unfunded Term Loan (7)
1,900
Inovex Information Systems Incorporated - Funded Revolver
12/17/2030
974
Inovex Information Systems Incorporated - Unfunded Revolver (7)
1,401
Inventus Power, Inc. - Funded Revolver
01/15/2026
Electronics
11.93
3M SOFR+761
Inventus Power, Inc. - Unfunded Revolver (7)
1,441
Kinetic Purchaser, LLC
11/10/2027
10.45
3M SOFR+615
3,099
3,039
2,944
Kinetic Purchaser, LLC - Funded Revolver
11/10/2026
10.47
2,427
2,305
Kinetic Purchaser, LLC - Unfunded Revolver (7)
(121
Lash OpCo, LLC
02/18/2027
12.14
3M SOFR+785
3,016
2,996
2,956
(PIK 5.10%)
10
Lash OpCo, LLC - Funded Revolver
08/16/2026
2,790
2,734
Lash OpCo, LLC - Unfunded Revolver (7)
317
(6
LAV Gear Holdings, Inc. (10)
10/31/2025
2,125
2,088
1,591
LAV Gear Holdings, Inc. - Incremental Term Loan
PIK 10.00%
131
172
Ledge Lounger, Inc.
11/09/2026
11.95
3M SOFR+765
8,998
8,941
8,458
Ledge Lounger, Inc. - Funded Revolver
1,621
1,524
Lightspeed Buyer, Inc.
02/03/2027
9.08
2,016
Lightspeed Buyer Inc. - Unfunded Revolver (7)
1,166
LJ Avalon Holdings, LLC
02/01/2030
Environmental Services
1,110
1,104
LJ Avalon Holdings, LLC - Unfunded Term Loan (7)
LJ Avalon Holdings, LLC - Unfunded Revolver (7)
02/01/2029
587
Loving Tan Intermediate II, Inc.
05/31/2028
7,089
7,010
7,053
Loving Tan Intermediate II, Inc. - Funded Revolver
332
330
Loving Tan Intermediate II, Inc. - Unfunded Revolver (7)
664
Loving Tan Intermediate II, Inc. - Unfunded Term Loan (7)
07/14/2025
2,018
Marketplace Events Acquisition, LLC
12/19/2030
869
860
Marketplace Events Acquisition, LLC - Unfunded Term Loan (7)
06/19/2026
3,483
Marketplace Events Acquisition, LLC - Funded Revolver
653
Marketplace Events Acquisition, LLC - Unfunded Revolver (7)
MBS Holdings, Inc.
04/16/2027
3M SOFR+510
268
267
MBS Holdings, Inc. - Unfunded Revolver (7)
694
MDI Buyer, Inc. - Funded Revolver
07/25/2028
Chemicals, Plastics and Rubber
11.50
3M SOFR+375
1,407
1,393
MDI Buyer, Inc. - Unfunded Revolver (7)
819
Meadowlark Acquirer, LLC
12/10/2027
9.95
3M SOFR+565
1,908
1,896
1,879
Meadowlark Acquirer, LLC - Funded Revolver
337
Meadowlark Acquirer, LLC- Unfunded Revolver (7)
1,348
(20
Medina Health, LLC - Unfunded Revolver (7)
10/20/2028
2,774
Megawatt Acquisitionco, Inc. - Funded Revolver
03/01/2030
483
446
Megawatt Acquisitionco, Inc. - Unfunded Revolver (7)
1,374
(106
Mineola 212, LLC
12/24/2025
3,500
3,511
MOREGroup Holdings, Inc. - Unfunded Term Loan (7)
01/16/2026
6,124
61
MOREGroup Holdings, Inc. - Unfunded Revolver (7)
01/16/2030
3,675
Municipal Emergency Services, Inc.
10/01/2027
9.45
3M SOFR+515
376
373
Municipal Emergency Services, Inc. - Unfunded Term Loan 3rd Amendment (7)
09/28/2027
123
1
Municipal Emergency Services, Inc. - Unfunded Revolver (7)
1,880
NBH Group LLC - Unfunded Revolver (7)
08/19/2026
1,163
NORA Acquisition, LLC - Funded Revolver
08/31/2029
10.65
406
403
NORA Acquisition, LLC - Unfunded Revolver (7)
2,301
NP Riverhead Industrial, LLC
07/10/2025
14.50
5,000
5,003
5,050
Omnia Exterior Solutions, LLC - Unfunded Term Loan 2 (7)
5,598
Omnia Exterior Solutions, LLC - Funded Revolver
12/31/2029
420
416
Omnia Exterior Solutions, LLC - Unfunded Revolver (7)
1,680
ORL Acquisition, Inc.
09/03/2027
13.73
3M SOFR+940
4,321
4,285
3,888
(PIK 7.50%)
ORL Acquisition, Inc. - Unfunded Revolver (7)
149
OSP Embedded Purchaser, LLC
12/17/2029
6,403
6,309
6,300
OSP Embedded Purchaser, LLC - Unfunded Revolver (7)
1,477
Pacific Purchaser, LLC
10/02/2028
820
809
811
Pacific Purchaser, LLC - Unfunded Revolver (7)
1,373
PAR Excellence Holdings, Inc.
09/03/2030
11,970
11,853
11,850
PAR Excellence Holdings, Inc. - Unfunded Revolver (7)
2,681
PCS MIDCO INC
2,167
2,149
2,178
PCS MIDCO INC - Unfunded Term Loan (7)
03/02/2026
2,239
PCS MIDCO INC - Funded Revolver
132
133
PCS MIDCO INC - Unfunded Revolver (7)
1,630
PlayPower, Inc.
08/28/2030
11,910
11,833
11,791
PlayPower, Inc. - Unfunded Revolver (7)
2,570
(26
PL Acquisitionco, LLC - Unfunded Revolver (7)
11/09/2027
Retail
1,618
(615
Project Granite Buyer, Inc. - Unfunded Term Loan (7)
554
Project Granite Buyer, Inc. - Unfunded Revolver (7)
12/31/2030
923
Radius Aerospace, Inc. - Funded Revolver
03/29/2027
410
399
Radius Aerospace, Inc. - Unfunded Revolver (7)
1,819
Rancho Health MSO, Inc. - Unfunded Term Loan (7)
1,954
Rancho Health MSO, Inc. - Funded Revolver
06/20/2029
9.56
1,248
Rancho Health MSO, Inc. - Unfunded Revolver (7)
1,427
Recteq, LLC - Funded Revolver
01/29/2026
11.09
313
311
Recteq, LLC - Unfunded Revolver (7)
814
Riverpoint Medical, LLC - Unfunded Revolver (7)
06/21/2027
364
Ro Health, LLC - Unfunded Revolver (7)
01/17/2031
Healthcare Providers & Services
4,193
Route 66 Development
01/24/2031
Gaming
13.33
3M SOFR+900
18,000
17,653
17,910
RRA Corporate, LLC
08/15/2029
9.30
3,003
2,973
2,979
RRA Corporate, LLC - Unfunded Term Loan 2 (7)
08/17/2026
7,178
14
RRA Corporate, LLC - Funded Revolver
1,763
1,749
RRA Corporate, LLC - Unfunded Revolver (7)
1,385
RTIC Subsidiary Holdings, LLC - Funded Revolver
05/03/2029
2,169
2,131
RTIC Subsidiary Holdings, LLC - Unfunded Revolver (7)
3,253
(57
Rural Sourcing Holdings, Inc. - Unfunded Term Loan (7)
06/26/2026
1,146
(23
Rural Sourcing Holdings, Inc. - Funded Revolver
06/15/2029
10.08
487
475
Rural Sourcing Holdings, Inc. - Unfunded Revolver (7)
(9
Sabel Systems Technology Solutions, LLC - Unfunded Revolver (7)
10/31/2030
Government Services
1,328
Safe Haven Defense US LLC
05/23/2029
Building Materials
3,930
3,879
Safe Haven Defense US LLC - Unfunded Revolver (7)
1,114
Sales Benchmark Index LLC - Funded Revolver
07/07/2026
9.50
3M SOFR+520
427
Sales Benchmark Index LLC - Unfunded Revolver (7)
183
Sath Industries, LLC
Event Services
9.81
11,417
11,313
Sath Industries, LLC - Unfunded Revolver (7)
1,300
Schlesinger Global, Inc.
07/21/2025
12.92
3M SOFR+860
5,090
5,089
4,836
(PIK 5.85%)
Schlesinger Global, Inc. - Funded Revolver
32
Schlesinger Global, Inc. - Unfunded Revolver (7)
12
Seacoast Service Partners, LLC
12/20/2029
1,805
1,790
1,742
Seacoast Service Partners, LLC - Unfunded Term Loan (7)
12/21/2026
3,608
(95
Seacoast Service Partners, LLC - Funded Revolver
379
Seacoast Service Partners, LLC - Unfunded Revolver (7)
962
(34
Seaway Buyer, LLC
06/13/2029
4,668
4,621
4,400
Seaway Buyer, LLC - Funded Revolver
06/13/2028
2,605
2,455
Seaway Buyer, LLC - Unfunded Revolver (7)
521
(30
Shiftkey, LLC
10.31
3M SOFR+601
17,431
17,338
16,333
Sigma Defense Systems, LLC
12/20/2027
11.47
10,497
10,255
Sigma Defense Systems, LLC - Funded Revolver
848
Sigma Defense Systems, LLC - Unfunded Revolver (7)
2,838
Spendmend Holdings LLC
03/01/2028
1,195
Spendmend Holdings LLC - Unfunded Term Loan 2 (7)
11/25/2026
1,434
Spendmend Holdings LLC - Funded Revolver
9.38
234
Spendmend Holdings LLC - Unfunded Revolver (7)
1,168
STG Distribution, LLC (fka Reception Purchaser) - First Out New Money Term Loans
10/03/2029
Transportation
12.66
3M SOFR+835
4,248
4,041
3,568
(PIK 7.25%)
STG Distribution, LLC (fka Reception Purchaser) - Second Out Term Loans (13)
5.42
9,842
5,656
2,953
SV-Aero Holdings, LLC - Unfunded Term Loan (7)
11/02/2026
3,562
18
System Planning and Analysis, Inc.
8.95
8,312
8,260
8,246
System Planning and Analysis, Inc. - Unfunded Term Loan (7)
06/12/2027
1,751
System Planning and Analysis, Inc. - Funded Revolver
9.06
1,747
1,733
System Planning and Analysis, Inc. - Unfunded Revolver (7)
2,969
TCG 3.0 Jogger Acquisitionco, Inc.
01/23/2029
8,888
8,769
TCG 3.0 Jogger Acquisitionco, Inc. - Funded Revolver
345
TCG 3.0 Jogger Acquisitionco, Inc. - Unfunded Revolver (7)
1,380
The Bluebird Group LLC - Unfunded Revolver (7)
07/28/2026
734
The Vertex Companies, LLC
08/31/2028
9.43
182
180
The Vertex Companies, LLC - Unfunded Term Loan (7)
11/04/2026
6,457
36
The Vertex Companies, LLC - Funded Revolver
9.42
592
591
The Vertex Companies, LLC - Unfunded Revolver (7)
3,376
TransGo, LLC - Unfunded Revolver (7)
12/29/2028
Machinery
2,775
Urology Management Holdings, Inc. - Unfunded Term Loan A (7)
09/03/2026
1,000
US Fertility Enterprises, LLC
10/11/2031
8.78
3M SOFR+450
264
VRS Buyer, Inc. - Unfunded Term Loan (7)
11/23/2026
4,759
VRS Buyer, Inc. - Unfunded Revolver (7)
11/22/2030
2,380
Watchtower Intermediate, LLC. - Unfunded Revolver (7)
Wash & Wax Systems LLC
04/30/2028
PIK 9.78%
1,180
1,202
1,204
Wash & Wax Systems LLC - Funded Revolver
Wash & Wax Systems LLC - Unfunded Revolver (7)
Total First Lien Secured Debt
417,635
405,240
Second Lien Secured Debt - 3.7% of Net Assets
Burgess Point Purchaser Corporation
07/28/2030
13.38
3M SOFR+910
8,000
7,732
ENC Parent Corporation - Second Lien
08/19/2029
12.06
3M SOFR+776
7,500
7,451
6,600
Team Services Group, LLC
12/18/2028
13.54
3M SOFR+926
3,429
3,426
3,411
Total Second Lien Secured Debt
18,609
18,011
Subordinate Debt/Corporate Notes - 6.4% of Net Assets
Beacon Behavioral Holdings LLC
06/21/2030
PIK 15.00%
3,617
3,575
3,581
Northwinds Topco, Inc.
10/30/2029
7,964
7,874
7,904
Northwinds Topco, Inc. - Unfunded Term Loan (7)
7,000
(53
ORL Holdco, Inc. - Convertible Notes
03/08/2028
18.00
ORL Holdco, Inc. - Unfunded Convertible Notes (7)
OSP Embedded Aggregator, LP - Convertible Note
05/08/2030
24
237
289
Schlesinger Global, LLC - Promissory Note
01/08/2026
StoicLane, Inc. - Convertible Notes
917
1,014
StoicLane, Inc. - Unfunded Convertible Notes (7)
306
United Land Services Intermediate Parent Holdings, LLC
12/23/2026
PIK 14.75%
17,456
17,207
17,281
United Land Services Intermediate Parent Holdings, LLC - Unfunded Term Loan (7)
07/12/2025
2,541
07/30/2028
787
788
786
Total Subordinate Debt
30,605
30,853
Preferred Equity/Partnership Interests - 3.9% of Net Assets (6)
Accounting Platform Blocker, Inc.
356,200
356
Ad.net Holdings, Inc.
2,400
240
AFC Acquisitions, Inc. (F-2 Series) (9)
490
749
619
AFC Acquisitions, Inc. (G-2 Series) (9)
AFC Acquisitions, Inc. (H-2 Series) (9)
AFC Acquisitions, Inc. (I-2 Series) (9)
AFC Acquisitions, Inc. (J-2 Series) (9)
AH Newco Equityholdings, LLC
6.00
211
500
366
Anteriad Holdings, LP (f/k/a MeritDirect Holdings, LP) (9)
1,135
BioDerm Holdings, LP
1,312
1,275
Cartessa Aesthetics, LLC (9)
3,562,500
3,563
7,611
Connatix Parent, LLC
7,967
C5MI Holdco, LLC (9)
104,000
118
Gauge Schlesinger Coinvest, LLC - Class A-2
EvAL Home Health Solutions, LLC (9)
272,771
426
Hancock Claims Consultants Investors, LLC - Class A (9)
116,588
76
142
Imagine Topco, LP Preferred
8.00
743,826
744
956
Magnolia Topco LP - Class A (9)
1,545
1,759
Magnolia Topco LP - Class A-1 (9)
530
1,060
Magnolia Topco LP - Class B (9)
1,018
643
516
Megawatt Acquisition Partners, LLC - Class A
5,349
535
340
NXOF Holdings, Inc. (Tyto Athene, LLC)
422
468
ORL Holdco, Inc.
575
57
PL Acquisitionco, LLC - (9)
RTIC Parent Holdings, LLC - Class A (9)
RTIC Parent Holdings, LLC - Class C (9)
10,624
699
1,061
RTIC Parent Holdings, LLC - Class D (9)
11,276
113
145
SP L2 Holdings LLC
331,229
SP L2 Holdings LLC - Unfunded (7)
189,274
(43
TPC Holding Company, LP
Food
219
TWD Parent Holdings, LLC
30
Total Preferred Equity/Partnership Interests
14,255
18,947
Common Equity/Partnership Interests/Warrants - 27.5% of Net Assets (6)
A1 Garage Equity, LLC (9)
2,193,038
2,193
3,663
ACP Big Top Holdings, L.P.
773,800
903
2,667
Aechelon InvestCo, LP
10,684
1,068
3,440
Aechelon InvestCo, LP - Unfunded (7)
11,940
Aftermarket Drivetrain Products Holdings, LLC
1,645
AG Investco LP (9)
8,052
805
AG Investco LP - Unfunded (7), (9)
1,948
(158
Altamira Intermediate Company II, Inc.
125,000
125
128
AMCSI Crash Co-Invest, LP
24,898
2,490
3,486
AMCSI Crash Co-Invest, LP - Unfunded (7)
5,102
Athletico Holdings, LLC (9)
9,357
7,034
Atlas Investment Aggregator, LLC
1,700,000
1,613
Azureon, LLC (9)
508,238
508
BioDerm, Inc.
Burgess Point Holdings, LP
764
777
781
Carnegie Holdco, LLC (9)
1,680,300
1,633
1,378
Carisk Parent, L.P.
204,455
204
273,207
632
322
Consello Pacific Aggregator, LLC (9)
782,891
743
Cowboy Parent LLC
27,778
3,015
Crane 1 Acquisition Parent Holdings, L.P.
221
754,200
754
455
Delta InvestCo LP (9)
913,649
866
1,443
Delta InvestCo LP - Unfunded (7), (9)
227,395
ENNANTPARK INVESTMENT CORPORATION AND SUBSIDIARIES
Duggal Acquisition, LLC
314
319
eCommission Holding Corporation (11)
80
905
EDS Topco, LP
937,500
938
1,515
Events Buyer, LLC
536,267
536
616
Exigo, LLC
1,458,333
1,458
FedHC InvestCo LP (9)
15,255
545
2,047
FedHC InvestCo LP - Unfunded (7), (9)
2,563
FedHC InvestCo II LP (9)
21,817
2,303
3,037
First Medical Holdings, LLC
45,000
Five Star Parent Holdings, LLC
655,714
656
174
Gauge ETE Blocker, LLC
374,444
374
352
Gauge Lash Coinvest LLC
1,231,392
951
Gauge Loving Tan, LP
543,562
544
645
Gauge Schlesinger Coinvest, LLC
GCOM InvestCo LP
2,434
1,003
GCP Boss Holdco, LLC
1,045,100
1,045
GGG MIDCO, LLC (9)
1,222,700
1,223
1,273
GMP Hills, LP
3,747,470
3,747
4,085
Hancock Claims Consultants Investors, LLC (9)
450,000
230
HPA SPQ Aggregator LP
750,399
1,600,000
1,600
Icon Partners V C, L.P.
1,137,608
1,138
1,080
Icon Partners V C, L.P. - Unfunded (7)
362,392
(18
IHS Parent Holdings, L.P.
1,218,045
1,218
1,693
Imagine Topco, LP
Infogroup Parent Holdings, Inc.
Other Media
181,495
2,040
2,710
Ironclad Holdco, LLC (Applied Technical Services, LLC)
4,993
525
784
ITC Infusion Co-invest, LP (9)
162,445
1,673
3,525
1,308,814
1,309
Kinetic Purchaser, LLC - Class AA
115,688
135
271
KL Stockton Co-Invest LP (Any Hour Services) (9)
382,353
385
531
Lightspeed Investment Holdco LLC
273,143
273
1,016
LJ Avalon, LP
851,087
851
Lorient Peregrine Investments, LP
335,590
4,530
2,514
1,545,460
1,017,840
14,640
1,464
1,605
MDI Aggregator, LP
31,904
3,232
3,442
Meadowlark Title, LLC (9)
815,385
802
106
594
59
3,920,145
3,984
7,095
NEPRT Parent Holdings, LLC (Recteq, LLC) (9)
1,299
New Insight Holdings, Inc.
1,157
New Medina Health, LLC (9)
1,429,480
1,429
NFS - CFP Holdings LLC
662,983
663
NORA Parent Holdings, LLC (9)
1,257
599
North Haven Saints Equity Holdings, LP (9)
351,553
380
Northwinds Services Group, LLC
840,000
1,978
NXOF Holdings, Inc.
8,188
108
OceanSound Discovery Equity, LP (Holdco Sands Intermediate, LLC) (9)
119,966
1,200
1,530
OES Co-Invest, LP - Class A
840
847
1,033
OHCP V BC COI, L.P.
699,844
700
413
OHCP V BC COI, L.P. - Unfunded (7)
50,156
(21
638
OSP Embedded Aggregator, LP
871
1,059
OSP PAR Holdings, LP
1,806
1,812
2,229
PCS Parent, LP
421,304
421
442
PennantPark-TSO Senior Loan Fund II, LP (11)
8,115,794
8,116
7,177
Pink Lily Holdco, LLC (9)
1,044
Project Granite Holdings, LLC
369
381
Quad (U.S.) Co-Invest, L.P.
2,607,587
2,608
3,874
QuantiTech InvestCo LP (9)
98
QuantiTech InvestCo LP - Unfunded (7), (9)
955
QuantiTech InvestCo II LP (9)
40
RFMG Parent, LP
1,050,000
Ro Health Holdings, Inc.
289,700
290
Sabel InvestCo, LP (9)
31,972
830
15
Sabel InvestCo, LP - Unfunded (7), (9)
47,957
Safe Haven Defense MidCo, LLC (9)
245
SBI Holdings Investments LLC
36,585
454
274
351
295
Seaway Topco, LP
2,981
SP L2 Holdings, LLC
881,966
882
SSC Dominion Holdings, LLC
4,358
StellPen Holdings, LLC
153,846
154
112
SV Aero Holdings, LLC (9)
25
216
607
TAC LifePort Holdings, LLC (9)
254,206
239
TCG 3.0 Jogger Co-Invest, LP
6,475
768
Tinicum Space Coast Co-Invest, LLC (9)
2,177
2,401
Tower Arch Infolinks Media, LP (9)
546,509
252
931
Tower Arch Infolinks Media, LP - Unfunded (7), (9)
348,936
11,527
United Land Services Holdings LLC
184,049
724
UniVista Insurance (9)
Urology Partners Co., L.P.
1,111,111
1,109
1,964
514
943
Watchtower Holdings, LLC (9)
12,419
1,242
WCP Ivyrehab Coinvestment, LP (9)
208
WCP Ivyrehab QP CF Feeder, LP (9)
3,754
3,793
4,431
WCP Ivyrehab QP CF Feeder, LP - Unfunded (7), (9)
Kentucky Racing Holdco, LLC (Warrants) (9)
Hotels, Motels, Inns and Gaming
161,252
Total Common Equity/Partnership Interests/Warrants
117,325
132,039
US Government Securities - 25.9% of Net Assets
U.S. Treasury Bill (5)
07/22/2025
Short-Term U.S. Government Securities
4.24
124,697
Total US Government Securities
Total Investments in Non-Controlled, Non-Affiliated Portfolio Companies
723,149
Investments in Non-Controlled, Affiliated Portfolio Companies - 1.6% of Net Assets (1), (2)
First Lien Secured Debt - 0.0%
Walker Edison Furniture Company LLC (10)
03/01/2029
Home and Office Furnishings
13,825
11,660
Walker Edison Furniture Company LLC - Unfunded Term Loan (7), (10)
(312
Walker Edison Furniture Company LLC - Junior Revolver (10)
3,333
3,332
333
14,992
21
Preferred Equity/Partnership Interests - 1.6% of Net Assets (6)
Cascade Environmental Holdings, LLC
5,887,236
32,791
5,894
Cascade Environmental Holdings, LLC - Series B
918
33,709
7,463
Common Equity/Partnership Interests/Warrants - 0.0% of Net Assets (6)
7,444,347
2,852
Walker Edison Furniture
72,917
6,890
9,742
Total Investments in Non-Controlled, Affiliated Portfolio Companies
58,443
Investments in Controlled, Affiliated Portfolio Companies - 90.4% (1), (2)
First Lien Secured Debt - 14.8% of Net Assets
AKW Holdings Limited (8), (11)
GBP 42,457
58,074
58,181
Pragmatic Institute, LLC
03/28/2030
PIK 9.80%
14,669
13,019
72,743
71,200
16
Subordinated Debt - 34.0% of Net Assets
Flock Financial, LLC (11)
10/19/2027
23,031
PennantPark Senior Loan Fund, LLC (11)
07/31/2027
12.29
3M SOFR+800
140,287
140,288
Total Subordinated Debt
163,319
Preferred Equity - 6.1% of Net Assets (6)
Flock Financial Class A (11)
2,047,727
7,313
18,712
Flock Financial Class B (9), (11)
5,409,091
19,318
10,644
Total Preferred Equity
26,631
29,356
Common Equity - 35.5% of Net Assets (6)
950
18,690
JF Intermediate, LLC
43,918
4,488
78,459
82,176,579
82,358
73,329
480
Total Common Equity
86,978
170,478
Total Investments in Controlled, Affiliated Portfolio Companies
349,671
Total Investments - 243.8% of Net Assets (12)
1,131,263
Cash and Cash Equivalents - 14.7% of Net Assets
BlackRock Federal FD Institutional 81
4.19
49,497
Non-Money Market Cash
20,911
21,049
Total Cash and Cash Equivalents
70,408
Total Investments and Cash Equivalents - 258.5%
1,201,671
1,242,170
Liabilities in Excess of Other Assets - (158.5)%
(761,585
Net Assets - 100%
17
CONSOLIDATED SCHEDULE OF INVESTMENTS
Investments in Non-Controlled, Non-Affiliated Portfolio Companies - 184.3% (1), (2)
First Lien Secured Debt - 112.9% of Net Assets
A1 Garage Merger Sub, LLC
10.95%
3M SOFR+610
5,345
5,279
A1 Garage Merger Sub, LLC - Unfunded Term Loan (8)
12/21/2024
1,534
23
A1 Garage Merger Sub, LLC - Revolver (8)
10.52%
28
ACP Avenu Buyer, LLC - Unfunded Term Loan (8)
04/02/2025
1,799
ACP Avenu Buyer, LLC - Funded Revolver
10.45%
ACP Avenu Buyer, LLC - Revolver (8)
947
(31
ACP Falcon Buyer, Inc. - Revolver (8)
10.93%
178
Ad.net Acquisition, LLC - Revolver (8)
11.60%
1,963
Adweek Purchaser, LLC - Unfunded Term Loan (8)
12.60%
3M SOFR+750
4,951
4,900
Aechelon Technology, Inc. - Unfunded Revolver (8)
Aeronix, Inc. - Revolver (8)
12/12/2028
2,489
10.48%
9,781
9,762
9,683
AFC Dell Holding Corp. - Unfunded Term Loan (8)
(44
Atlas Purchaser, Inc. - Third Out
11.97%
7,499
6,144
Atlas Purchaser, Inc. - Fourth Out
674
624
Anteriad, LLC (f/k/a MeritDirect, LLC) - Revolver (8)
1,612
Applied Technical Services, LLC
12/29/2026
10.50%
1,182
1,174
1,164
Applied Technical Services, LLC - Unfunded Term Loan (8)
07/17/2025
2,637
(13
Applied Technical Services, LLC - Revolver
13.25%
1,133
1,116
Applied Technical Services, LLC - Unfunded Revolver (8)
669
Arcfield Acquisition Corp. - Revolver (8)
08/04/2028
3,521
Archer Lewis, LLC
10.83%
8,700
8,614
8,526
Archer Lewis, LLC - Unfunded Term Loan A (8)
08/28/2025
5,324
Archer Lewis, LLC - Unfunded Term Loan B (8)
8,527
(85
Archer Lewis, LLC - Unfunded Revolver (8)
10.85%
15,000
14,851
14,850
Argano, LLC. - Unfunded Term Loan (8)
03/13/2025
4,981
Argano, LLC. - Unfunded Revolver (8)
Beacon Behavioral Support Service, LLC
9.85%
2,396
2,372
2,360
Beacon Behavioral Support Service, LLC - Unfunded Term Loan (8)
12/21/2025
(19
Beacon Behavioral Support Service, LLC - Revolver (8)
1,206
05/02/2025
13.00%
4,042
3,988
07/01/2029
10.35%
4,832
Big Top Holdings, LLC - Unfunded Revolver (8)
BioDerm, Inc. - Revolver
11.84%
589
582
BioDerm, Inc. - Revolver (8)
482
11.00%
3M SOFR+640
6,279
6,239
6,171
Blackhawk Industrial Distribution, Inc. - Unfunded Term Loan (8)
2,368
Blackhawk Industrial Distribution, Inc. - Revolver
11.04%
1,093
1,074
Blackhawk Industrial Distribution, Inc. - Unfunded Revolver (8)
3,764
(64
BlueHalo Financing Holdings, LLC
10.44%
Broder Bros., Co.
12/04/2025
10.97%
3M SOFR+611
9,524
Carisk Buyer, Inc. - Unfunded Term Loan (8)
12/01/2029
Carisk Buyer, Inc. - Revolver (8)
12,935
12,745
12,741
Carnegie Dartlet, LLC - Unfunded Term Loan (8)
10,017
Carnegie Dartlet, LLC - Unfunded Revolver (8)
CONSOLIDATED SCHEDULE OF INVESTMENTS – (Continued)
28,737
28,334
28,736
Cartessa Aesthetics, LLC - Revolver
Cartessa Aesthetics, LLC - Unfunded Revolver (8)
CF512, Inc.
11.05%
3M SOFR+619
6,525
6,427
CF512, Inc. - Revolver (8)
909
(14
Compex Legal Services, Inc.
10.31%
939
933
Compex Legal Services, Inc. - Revolver
02/07/2025
10.80%
328
Compex Legal Services, Inc. - Unfunded Revolver (8)
Confluent Health, LLC
11/30/2028
12.35%
1,970
1,854
Connatix Buyer, Inc. - Funded Revolver
10.58%
424
Connatix Buyer, Inc. - Revolver (8)
1,451
Crane 1 Services, Inc.
9.40%
3M SOFR+586
1,777
Crane 1 Services, Inc. - Revolver (8)
07/31/2030
10.60%
14,778
14,700
276
270
C5MI Acquisition, LLC - Unfunded Revolver (8)
3,858
(77
Dr. Squatch, LLC
Personal and Non-Durable Consumer Products
9.95%
3M SOFR+535
8,058
Dr. Squatch, LLC - Unfunded Revolver (8)
11.20%
DRS Holdings III, Inc. - Revolver (8)
1,783
9.60%
6,930
Duggal Acquisition, LLC - Unfunded Term Loan (8)
Duggal Acquisition, LLC - Unfunded Revolver (8)
07/15/2028
10.88%
77
EDS Buyer, LLC
12,261
12,106
12,077
EDS Buyer, LLC - Revolver (8)
(29
9.12%
2,995
2,865
11.10%
1,215
ETE Intermediate II, LLC - Revolver (8)
Eval Home Health Solutions Intermediate, LLC - Revolver (8)
24,128
23,911
24,007
Exigo Intermediate II, LLC - Revolver (8)
12.21%
Five Star Buyer, Inc. - Revolver (8)
741
05/19/2029
12.56%
215
9.64%
8,525
8,440
GGG MIDCO, LLC - Unfunded Term Loan (8)
03/27/2026
13,728
GGG MIDCO, LLC - Unfunded Revolver (8)
10.20%
1,132
1,123
1,121
Graffiti Buyer, Inc. - Unfunded Term Loan (8)
(2
Graffiti Buyer, Inc. - Funded Revolver
10.62%
384
Graffiti Buyer, Inc. - Revolver (8)
06/30/2025
9.45%
3M SOFR+460
4,712
4,382
1M SOFR+560
680
666
Hancock Roofing and Construction L.L.C. - Revolver (8)
70
5,593
5,545
5,495
Harris & Co. LLC - Unfunded Term Loan A (8)
02/09/2025
13,051
(114
Harris & Co. LLC - Unfunded Term Loan B (8)
16,654
(146
Harris & Co. LLC - Unfunded Revolver (8)
2,451
19
Hills Distribution, Inc. - Unfunded Term Loan (8)
9,144
11.73%
1M SOFR+640
279
256
HV Watterson Holdings, LLC - Revolver
1,213
1,112
HV Watterson Holdings, LLC - Unfunded Revolver (8)
37
HW Holdco, LLC
05/10/2026
11,124
11,112
HW Holdco, LLC - Revolver (8)
11.25%
105
IG Investments Holdings, LLC - Revolver (8)
09/22/2027
Imagine Acquisitionco, LLC (8)
11/15/2027
11.39%
3M SOFR+685
2,458
2,429
CAD 2,562
1,846
1,897
Infinity Home Services Holdco, Inc. - 1st Amendment Unfunded Term Loan (8)
11/17/2025
6,573
13.75%
194
Infinity Home Services Holdco, Inc. - Revolver (8)
1,098
Infolinks Media Buyco, LLC
11/01/2026
10.10%
1,281
1,272
Inventus Power, Inc. - Revolver (8)
1,729
ITI Holdings, Inc.
03/03/2028
8,748
8,647
ITI Holdings, Inc. - Revolver
12.50%
ITI Holdings, Inc. - Unfunded Revolver (8)
10.75%
3,023
Kinetic Purchaser, LLC - Revolver (8)
4,854
12.94%
1M SOFR+785
2,902
2,871
2,873
Lash OpCo, LLC - Revolver
13.18%
2,685
2,658
Lash OpCo, LLC - Unfunded Revolver (8)
LAV Gear Holdings, Inc.
11.50%
1M SOFR+643
2,032
1,996
12.24%
8,999
8,911
8,549
Ledge Lounger, Inc. - Revolver
12.25%
644
612
Ledge Lounger, Inc. - Unfunded Revolver (8)
966
(48
Lightspeed Buyer Inc. - Revolver (8)
02/03/2026
01/31/2030
1M SOFR+525
1,459
1,438
LJ Avalon Holdings, LLC - Unfunded Term Loan (8)
10/01/2024
2,419
LJ Avalon Holdings, LLC - Revolver (8)
9,784
9,633
9,637
Loving Tan Intermediate II, Inc. - Revolver
327
Loving Tan Intermediate II, Inc. - Unfunded Revolver (8)
Loving Tan Intermediate II, Inc. - Unfunded Term Loan (8)
4,376
MBS Holdings, Inc. - Funded Revolver
3M SOFR+585
83
MBS Holdings, Inc. - Revolver (8)
611
MDI Buyer, Inc.
10.71%
19,931
19,679
19,736
MDI Buyer, Inc. - Revolver
11.19%
1,529
1,514
MDI Buyer, Inc. - Unfunded Revolver (8)
698
1,923
1,874
Meadowlark Acquirer, LLC- Unfunded Revolver (8)
(42
Medina Health, LLC
4,887
Medina Health, LLC - Revolver (8)
10.11%
Megawatt Acquisitionco, Inc. - Unfunded Revolver (8)
1,653
(93
06/24/2025
3,489
MOREGroup Holdings, Inc.
7,450
7,348
7,338
MOREGroup Holdings, Inc. - Unfunded Term Loan (8)
MOREGroup Holdings, Inc. - Unfunded Revolver (8)
(55
9.77%
2,792
Municipal Emergency Services, Inc. - Unfunded Term Loan B (8)
12/16/2024
Municipal Emergency Services, Inc. - Unfunded Term Loan 3rd Amendment (8)
Municipal Emergency Services, Inc. - Revolver (8)
NBH Group LLC - Revolver (8)
(35
09/13/2030
9.56%
17,866
17,865
NFS - CFP Holdings LLC - Unfunded Term Loan (8)
09/13/2026
NFS - CFP Holdings LLC - Unfunded Revolver (8)
NORA Acquisition, LLC
5,445
5,348
NORA Acquisition, LLC - Revolver (8)
2,707
05/24/2025
14.50%
4,984
4,975
Omnia Exterior Solutions, LLC
12/29/2029
4,888
4,840
4,814
Omnia Exterior Solutions, LLC - Unfunded Term Loan 1 (8)
12/30/2024
3,499
Omnia Exterior Solutions, LLC - Unfunded Term Loan 2 (8)
Omnia Exterior Solutions, LLC - Revolver (8)
2,100
14.00%
4,245
4,198
ORL Acquisition, Inc. - Revolver (8)
12/15/2029
10.70%
6,451
6,345
6,264
OSP Embedded Purchaser, LLC - Revolver (8)
Ox Two, LLC
05/18/2026
11.12%
3M SOFR+651
8,460
8,403
Ox Two, LLC - Revolver (8)
Pacific Purchaser, LLC - Unfunded Term Loan (8)
09/30/2028
2,747
Pacific Purchaser, LLC - Revolver (8)
9,901
9,900
PAR Excellence Holdings, Inc. - Unfunded Revolver (8)
10.81%
1M SOFR+575
467
462
PCS MIDCO INC - Unfunded Term Loan (8)
03/01/2026
3,955
308
PCS MIDCO INC - Unfunded Revolver (8)
1,454
12,000
11,912
11,820
PlayPower, Inc. - Unfunded Revolver (8)
(39
PL Acquisitionco, LLC - Revolver (8)
3,236
(647
Pragmatic Institute, LLC (7)
07/06/2028
12.09%
37,241
36,054
22,810
(PIK 12.09%)
Pragmatic Institute, LLC - Revolver (7)
5,154
5,041
3,157
Quantic Electronics, LLC
11/19/2026
1,468
1,461
Quantic Electronics, LLC - Funded Revolver
263
Quantic Electronics, LLC - Unfunded Revolver (8)
Radius Aerospace, Inc. - Revolver
03/31/2025
817
800
Radius Aerospace, Inc. - Unfunded Revolver (8)
1,411
(28
Rancho Health MSO, Inc.
12/18/2025
10.90%
360
Rancho Health MSO, Inc. - Unfunded Term Loan (8)
210
Rancho Health MSO, Inc. - Unfunded Term Loan 2 (8)
1,500
Rancho Health MSO, Inc. - Revolver
Rancho Health MSO, Inc. - Unfunded Revolver (8)
315
Reception Purchaser, LLC
02/28/2028
10,763
9,638
8,072
Recteq, LLC - Revolver (8)
1,127
Riverpoint Medical, LLC - Revolver
06/20/2025
53
Riverpoint Medical, LLC - Unfunded Revolver (8)
310
3,960
RRA Corporate, LLC - Unfunded Term Loan 1 (8)
02/15/2025
5,394
RRA Corporate, LLC - Unfunded Term Loan 2 (8)
08/15/2026
10,181
655
RRA Corporate, LLC - Unfunded Revolver (8)
2,487
(25
RTIC Subsidiary Holdings, LLC
9,975
9,827
9,776
RTIC Subsidiary Holdings, LLC - Unfunded Revolver (8)
5,422
(108
Rural Sourcing Holdings, Inc.
1,140
1,124
1,126
Rural Sourcing Holdings, Inc. - Unfunded Term Loan (8)
06/27/2026
Rural Sourcing Holdings, Inc. - Revolver (8)
S101 Holdings, Inc.
11.48%
S101 Holdings, Inc. - Unfunded Term Loan 2 (8)
12/15/2024
4,955
Safe Haven Defense US LLC - Term Loan
8,976
8,843
8,886
Safe Haven Defense US LLC - Unfunded Revolver (8)
Sales Benchmark Index LLC - Revolver (8)
01/03/2025
732
Sargent & Greenleaf Inc. - Revolver
12/20/2024
11.87%
3M SOFR+660
610
Sargent & Greenleaf Inc. - Unfunded Revolver (8)
7.60%
3M SOFR+275
4,870
4,851
4,748
(PIK 5.60%)
Schlesinger Global, Inc. - Revolver
31
Schlesinger Global, Inc. - Unfunded Revolver (8)
4,704
4,650
4,539
Seaway Buyer, LLC - Revolver
Seaway Buyer, LLC - Unfunded Revolver (8)
2,814
(98
17,595
17,478
16,838
12/18/2027
1M SOFR+690
25,785
25,251
25,528
Sigma Defense Systems, LLC - Unfunded Revolver (8)
3,685
(37
Simplicity Financial Marketing Group Holdings Inc.
12/02/2026
4,065
4,054
4,106
Simplicity Financial Marketing Group Holdings Inc. - Unfunded Term Loan (8)
4,656
93
Simplicity Financial Marketing Group Holdings Inc. - Unfunded Revolver (8)
1,043
Smartronix, LLC - Unfunded Revolver (8)
11/23/2027
3,941
Solutionreach, Inc. - Unfunded Revolver (8)
Communications
833
10.25%
432
430
Spendmend Holdings LLC - Unfunded Term Loan (8)
03/01/2025
2,348
Spendmend Holdings LLC - Revolver
561
Spendmend Holdings LLC - Unfunded Revolver (8)
841
10.26%
1,283
1,274
System Planning and Analysis, Inc. - Unfunded Term Loan (8)
7,068
39
9.59%
919
System Planning and Analysis, Inc. - Unfunded Revolver (8)
3,795
01/26/2029
8,955
8,814
8,865
TCG 3.0 Jogger Acquisitionco, Inc. - Unfunded Revolver (8)
1,725
The Bluebird Group LLC - Revolver (8)
07/27/2026
08/30/2027
11.27%
184
The Vertex Companies, LLC - Revolver
305
The Vertex Companies, LLC - Unfunded Revolver (8)
TPCN Midco, LLC
3,990
3,931
3,894
TPCN Midco, LLC - Unfunded Term Loan (8)
(83
TPCN Midco, LLC - Unfunded Revolver (8)
1,160
22
TransGo, LLC
4,638
4,573
TransGo, LLC - Revolver (8)
TWS Acquisition Corporation
06/16/2025
11.33%
1,301
TWS Acquisition Corporation - Revolver (8)
1,644
Urology Management Holdings, Inc.
06/15/2027
10.66%
576
573
570
Urology Management Holdings, Inc. - Unfunded Term Loan A (8)
Watchtower Intermediate, LLC
7,301
7,201
7,228
Watchtower Intermediate, LLC. - Unfunded Term Loan (8)
12/01/2025
Watchtower Intermediate, LLC. - Revolver (8)
(63
Wildcat Buyerco, Inc.
02/27/2027
4,585
4,551
Wildcat Buyerco, Inc. - Unfunded Term Loan (8)
2,737
Wildcat Buyerco, Inc. - Revolver (8)
551
Zips Car Wash, LLC
12/31/2024
12.46%
3M SOFR+740
2,590
2,586
2,473
(PIK 1.5%)
579,813
557,686
Second Lien Secured Debt - 13.6% of Net Assets
Best Practice Associates LLC
06/29/2027
13.95%
3M SOFR+915
17,825
17,606
17,647
14.19%
7,698
12.37%
7,444
6,225
07/06/2026
13.20%
1M SOFR+835
32,500
32,299
31,931
14.51%
3,422
3,377
68,469
67,180
Subordinate Debt/Corporate Notes - 8.8% of Net Assets
15.00%
3,235
3,189
3,187
(PIK 15.00%)
Express Wash Acquisition Company, LLC
01/15/2029
16.37%
3M SOFR+1226
24,284
23,710
24,138
(PIK 16.37%)
7,123
7,020
6,944
Northwinds Topco, Inc. - Unfunded Term Loan (8)
(175
18.00%
ORL Holdco, Inc. - Unfunded Convertible Notes (8)
12.33%
(PIK 11.85%)
08/15/2027
12.00%
StoicLane, Inc. - Unfunded Convertible Notes (8)
14.25%
9,300
9,120
9,021
(PIK 14.25%)
United Land Services Intermediate Parent Holdings, LLC - Unfunded Term Loan (8)
9,000
43,658
43,597
Preferred Equity/Partnership Interests - 3.5% of Net Assets (6)
Accounting Platform Blocker, Inc. - Preferred Equity
304
AFC Acquisitions, Inc. Preferred Equity (10)
507
780
6.00%
896
Anteriad Holdings, LP (f/k/a MeritDirect Holdings, LP) (10)
1,293
BioDerm Holdings, LP (Preferred)
Cartessa Aesthetics, LLC (10)
6,343
C5MI Holdco, LLC - Preferred Equity (10)
Gauge Schlesinger Coinvest, LLC - Class A-2 Preferred Equity
EvAL Home Health Solutions, LLC - Preferred Equity (10)
Hancock Claims Consultants Investors, LLC - Class A Preferred Equity (10)
8.00%
862
Magnolia Topco LP - Class A Preferred Equity (10)
1,592
Magnolia Topco LP - Class B Preferred Equity (10)
Megawatt Acquisition Partners, LLC - Preferred A
481
572
PL Acquisitionco, LLC - Preferred Equity
RTIC Parent Holdings, LLC - Class A Preferred Equity (10)
RTIC Parent Holdings, LLC - Class C Preferred Equity (10)
RTIC Parent Holdings, LLC - Class D Preferred Equity (10)
354
TWD Parent Holdings, LLC Preferred
13,569
17,132
Common Equity/Partnership Interests/Warrants - 25.3% of Net Assets (6)
A1 Garage Equity, LLC (10)
2,767
ACP Big Top Holdings, L.P. - Common Equity
932
Aechelon InvestCo, LP - Common Equity
11,312
1,131
Aechelon InvestCo, LP - Unfunded (8)
2,304
AG Investco LP (10)
805,164
1,008
AG Investco LP - Unfunded (8),(10)
194,836
151
2,489,777
3,737
AMCSI Crash Co-Invest, LP - Unfunded (8)
510,223
Athletico Holdings, LLC (10)
7,674
812
Carnegie Holdco, LLC - Common Equity (10)
Carisk Parent, L.P. - Common Equity
57,416
Consello Pacific Aggregator, LLC (10)
703
5,809
190
C5MI Holdco, LLC - Common Equity (10)
752
Delta InvestCo LP (10)
1,703
Delta InvestCo LP (8),(10)
Duggal Acquisition, LLC (Common)
313,600
eCommission Holding Corporation (12)
949
2,554
1,047
1,577
FedHC InvestCo LP (10)
14,578
489
1,193
FedHC InvestCo LP - Unfunded (8),(10)
5,150
FedHC InvestCo II LP (10)
20,882
2,175
1,814
647
Gauge ETE Blocker, LLC - Common Equity
1,101,293
834
3,201
Gauge Loving Tan, LP - Common Equity
598
578
GGG MIDCO, LLC (Common) (10)
GMP Hills, LP - Common Equity
3,673
Hancock Claims Consultants Investors, LLC (10)
275
HPA SPQ Aggregator LP- Common Equity
842
1,122,549
Icon Partners V C, L.P. - Unfunded (8)
377,451
IHS Parent Holdngs, L.P.
1,535
2,711
776
ITC Infusion Co-invest, LP (10)
2,443
1,498
KL Stockton Co-Invest LP (Any Hour Services) (10)
884
LEP Pequod Holdings, LP
350
865
1,004
988
1,038
4,453
Magnolia Topco LP - Class A (10)
Magnolia Topco LP - Class B (10)
30,993
3,103
3,599
Meadowlark Title, LLC (10)
Megawatt Acquisition Partners, LLC - Common Equity A
6,272
NEPRT Parent Holdings, LLC (Recteq, LLC) (10)
87
New Insight Holdings, Inc. - Common Equity
New Medina Health, LLC (10)
2,231
NFS - CFP Holdings LLC - Common Equity
NORA Parent Holdings, LLC (10)
1,115
North Haven Saints Equity Holdings, LP (10)
Northwinds Services Group, LLC - Common Equity
OceanSound Discovery Equity, LP (Holdco Sands Intermediate, LLC) (10)
98,286
983
997
OES Co-Invest, LP Class A Common Equity
694,943
695
443
OHCP V BC COI, L.P. - Unfunded (8)
55,057
870,536
PAR Excellence Holdings, Inc. - Common Equity
1,087,000
1,087
PennantPark-TSO Senior Loan Fund II, LP (12)
8,126
Pink Lily Holdco, LLC (10)
1,918,047
1,918
2,958,706
2,959
3,780
QuantiTech InvestCo LP (10)
QuantiTech InvestCo LP - Unfunded (8), (10)
QuantiTech InvestCo II LP (10)
Safe Haven Defense MidCo, LLC (10)
227
247
2,006
4,154
134
SV Aero Holdings, LLC (10)
218
TAC LifePort Holdings, LLC (10)
388
TCG 3.0 Jogger Co-Invest, LP - Common Equity
965
Tower Arch Infolinks Media, LP (10)
542,000
251
Tower Arch Infolinks Media, LP - Unfunded (8), (10)
353,444
TPCN Holdings, LLC - Common Equity (10)
473,400
473
United Land Services Holdings LLC - Common Equity
UniVista Insurance (10)
334
844
1,111
1,184
Watchtower Holdings, LLC (10)
1,292
WCP Ivyrehab Coinvestment, LP (10)
WCP Ivyrehab QP CF Feeder, LP (10)
3,987
WCP Ivyrehab QP CF Feeder, LP - Unfunded (8), (10)
Wildcat Parent, LP
2,314
843
Kentucky Racing Holdco, LLC (Warrants) (10)
1,711
111,008
125,097
US Government Securities - 20.2% of Net Assets
10/29/2024
4.72%
100,000
99,652
99,632
916,168
Investments in Non-Controlled, Affiliated Portfolio Companies - 6.8% of Net Assets (1), (2)
First Lien Secured Debt - 0.8%
Walker Edison Furniture Company LLC (11)
10,877
10,054
979
Walker Edison Furniture Company, LLC - Unfunded Term Loan (11), (8)
167
(152
Walker Edison Furniture Company LLC - Junior Revolver (11)
13,387
4,160
Preferred Equity/Partnership Interests - 5.9% of Net Assets (6)
Cascade Environmental Holdings, LLC (Preferred)
27,931
1,331
29,262
6,786
56,734
Investments in Controlled, Affiliated Portfolio Companies - 77.8% (1), (2)
First Lien Secured Debt - 21.5% of Net Assets
AKW Holdings Limited (GBP) (9), (12)
12.16%
58,075
56,950
(PIK 5.47%)
JF Holdings Corp.
07/31/2026
11.30%
3M SOFR+605
49,625
49,114
49,129
107,189
106,079
Subordinated Debt - 28.0% of Net Assets
Flock Financial, LLC (12)
22,208
(PIK 14.50%)
PennantPark Senior Loan Fund, LLC (12)
115,886
138,094
Preferred Equity - 5.4% of Net Assets (6)
Flock Financial Class A Preferred Equity (12)
Flock Financial Class B Preferred Equity (12)
Common Equity - 23.0% of Net Assets (6)
AKW Holdings Limited - Common Equity (9), (12)
3,848
41,729
67,373,319
67,436
67,923
72,056
113,500
343,970
Total Investments - 268.9% of Net Assets (13)
1,316,872
Cash and Cash Equivalents - 10.1% of Net Assets
5.03%
38,769
11,064
11,092
49,833
Total Investments and Cash Equivalents - 279.0%
1,366,705
1,377,911
Liabilities in Excess of Other Assets - (179.0)%
(884,003
26
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
1. ORGANIZATION
PennantPark Investment Corporation was organized as a Maryland corporation in January 2007. We are a closed-end, externally managed, non-diversified investment company that has elected to be treated as a BDC under the 1940 Act. Our investment objective is to generate both current income and capital appreciation while seeking to preserve capital through debt and equity investments. We invest primarily in U.S. middle-market companies in the form of first lien secured debt, second lien secured debt, subordinated debt and, to a lesser extent, equity investments. On April 24, 2007, we closed our initial public offering. On April 14, 2022, trading of the Company's common stock commenced on the New York Stock Exchange after the Company voluntarily withdrew the principal listing of its common stock from the Nasdaq Stock Market LLC effective at market close on April 13, 2022. Our common stock trades on the New York Stock Exchange under the symbol “PNNT.”
We execute our investment strategy directly and through our wholly owned subsidiaries, our unconsolidated joint venture and unconsolidated limited partnership. The term “subsidiary” means entities that primarily engage in investment activities in securities or other assets and are wholly owned by us. The Company does not intend to create or acquire primary control of any entity which primarily engages in investment activities of securities or other assets other than entities wholly owned by the Company. We comply with the provisions of Section 18 of the 1940 Act governing capital structure and leverage on an aggregate basis with our subsidiaries. Our subsidiaries comply with the provisions of Section 17 of the 1940 Act related to affiliated transactions and custody. To the extent that the Company forms a subsidiary advised by an investment adviser other than the Investment Adviser, the investment adviser to such subsidiaries will comply with the provisions of the 1940 Act relating to investment advisory contracts, including but not limited to, Section 15, as if it were an investment adviser to the Company under Section 2(a)(20) of the 1940 Act.
We have entered into an investment management agreement, (the "Investment Management Agreement"), with PennantPark Investment Advisors, LLC (the "Investment Adviser"), an external adviser that manages our day-to-day operations. We have also entered into an administration agreement, (the "Administration Agreement"), with PennantPark Investment Administrator LLC (the "Administrator"), which provides the administrative services necessary for us to operate.
On July 31, 2020, we and certain entities and managed accounts of the private credit investment manager of Pantheon Ventures (UK) LLP, or Pantheon, entered into a limited liability company agreement to co-manage PSLF, a newly formed unconsolidated joint venture formed as a Delaware limited liability company. In connection with this transaction, we contributed in-kind our formerly wholly-owned subsidiary, Funding I. As a result of this transaction, Funding I became a wholly-owned subsidiary of PSLF and was deconsolidated from our financial statements. PSLF invests primarily in middle-market and other corporate debt securities consistent with our strategy. PSLF was formed as a Delaware limited liability company. See Note 4.
In April 2021, we issued $150.0 million in aggregate principal amount of our 2026 Notes at a public offering price per note of 99.4%. Interest on the 2026 Notes is
paid semi-annually on May 1 and November 1 of each year, at a rate of 4.50% per year, commencing November 1, 2021. The effective interest rate is 4.62%. The 2026 Notes mature on May 1, 2026 and may be redeemed in whole or in part at our option subject to a make-whole premium if redeemed more than three months prior to maturity. The 2026 Notes are general, unsecured obligations and rank equal in right of payment with all of our existing and future senior unsecured indebtedness. The 2026 Notes are effectively subordinated to all of our existing and future secured indebtedness to the extent of the value of the assets securing such indebtedness and structurally subordinated to all existing and future indebtedness and other obligations of any of our subsidiaries, financing vehicles, or similar facilities. We do not intend to list the 2026 Notes on any securities exchange or automated dealer quotation system.
In October 2021, we issued $165.0 million in aggregate principal amount of our 2026 Notes-2 at a public offering price per note of 99.4%. Interest on the 2026
Notes is paid semiannually on May 1 and November 1 of each year, at a rate of 4.00% per year, commencing May 1, 2022. The effective interest rate is 4.12%. The 2026 Notes-2 mature on November 1, 2026 and may be redeemed in whole or in part at our option subject to a make-whole premium if redeemed more than three months prior to maturity. The 2026 Notes-2 are general, unsecured obligations and rank equal in right of payment with all of our existing and future senior unsecured indebtedness. The 2026 Notes-2 are effectively subordinated to all of our existing and future secured indebtedness to the extent of the value of the assets securing such indebtedness and structurally subordinated to all existing and future indebtedness and other obligations of any of our subsidiaries, financing vehicles, or similar facilities. We do not intend to list the 2026 Notes-2 on any securities exchange or automated dealer quotation system.
On November 22, 2021, we formed PNNT Investment Holdings II, LLC, a Delaware limited liability company (“Holdings II”), as a wholly owned subsidiary. On December 31, 2022, we contributed 100% of our interests in PNNT Investment Holdings, LLC (“Holdings”) to Holdings II. Effective as of January 1, 2024, Holdings II elected to be treated as a corporation for U.S. federal income tax purposes. On January 3, 2024, we purchased an equity interest in Holdings from Holdings II and Holdings became a partnership for U.S. federal income tax purposes. The Company and Holdings II entered into a limited liability company agreement with respect to Holdings that provides for certain payments and the sharing of income, gain, loss and deductions attributable to Holdings’ investments.
In January 2022, we formed PennantPark-TSO Senior Loan Fund II, LP, ("PTSF II"), an unconsolidated limited partnership, organized as a Delaware limited partnership. We sold $82.3 million in investments to a wholly-owned subsidiary of PTSF II in exchange for cash in the amount of $75.7 million and an $6.6 million equity interest in PTSF II representing 23.1% of the total outstanding Class A Units of PTSF II. We recognized $0.2 million of realized gain upon the formation of PTSF II. As of June 30, 2025, our capital commitment of $15.0 million was 100% funded and we held 23.1% of the total outstanding Class A Units of PTSF II and a 4.99% voting interest in the general partner which manages PTSF II.
We are operated by a person who has claimed an exclusion from the definition of the term “commodity pool operator” under the Commodity Exchange Act of 1936, as amended, or the Commodity Exchange Act, and therefore, is not subject to registration or regulation as a commodity pool operator under the Commodity Exchange Act.
2. SIGNIFICANT ACCOUNTING POLICIES
The preparation of our consolidated financial statements, in conformity with U.S. generally accepted accounting principles, or GAAP requires management to make estimates and assumptions that affect the reported amount of our assets and liabilities at the date of the consolidated financial statements and the reported amounts of income and expenses during the reported periods. In the opinion of management, all adjustments, which are of a normal recurring nature, considered necessary for the fair presentation of financial statements have been included. Changes in the economic and regulatory environment, financial markets, the credit worthiness of our portfolio companies and any other parameters used in determining these estimates and assumptions could cause actual results to differ from such estimates and assumptions. We may reclassify certain prior period amounts to conform to the current period presentation. We have eliminated all intercompany balances and transactions in consolidation. References to the Financial Accounting Standards Board’s ("FASB’s") or Accounting Standards Codification, as amended ("ASC"), serve as a single source of accounting literature. Subsequent events are evaluated and disclosed as appropriate for events occurring through the date the consolidated financial statements are issued.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) - (Continued)
Our consolidated financial statements are prepared in accordance with GAAP, consistent with ASC Topic 946, Financial Services – Investment Companies, and pursuant to the requirements for reporting on Form 10-K/Q and Articles 6, 10 and 12 of Regulation S-X, as appropriate. In accordance with Article 6-09 of Regulation S-X, we have provided a consolidated statement of changes in net assets in lieu of a consolidated statement of changes in stockholders’ equity.
We expect that there may not be readily available market values for many of the investments which are or will be in our portfolio. We value such investments at fair value as determined in good faith by or under the direction of our board of directors using a documented valuation policy and a consistently applied valuation process, as described in this Report. With respect to investments for which there is no readily available market value, the factors that our board of directors may take into account in pricing our investments at fair value include, as relevant, the nature and realizable value of any collateral, the portfolio company’s ability to make payments and its earnings and discounted cash flow, the markets in which the portfolio company does business, comparison to publicly traded securities and other relevant factors. When an external event such as a purchase transaction, public offering or subsequent equity sale occurs, we consider the pricing indicated by the external event to corroborate or revise our valuation. Due to the inherent uncertainty of determining the fair value of investments that do not have a readily available market value, the price used in an actual transaction may be different than our valuation and the difference may be material. See Note 5.
Our portfolio generally consists of illiquid securities, including debt and equity investments. With respect to investments for which market quotations are not readily available, or for which market quotations are deemed not reflective of the fair value, our board of directors undertakes a multi-step valuation process each quarter, as described below:
Our board of directors generally uses market quotations to assess the value of our investments for which market quotations are readily available. We obtain these market values from independent pricing services or at the bid prices obtained from at least two brokers or dealers, if available, or otherwise from a principal market maker or a primary market dealer. The Investment Adviser assesses the source and reliability of bids from brokers or dealers. If our board of directors has a bona fide reason to believe any such market quote does not reflect the fair value of an investment, it may independently value such investments by using the valuation procedure that it uses with respect to assets for which market quotations are not readily available.
Security transactions are recorded on a trade-date basis. We measure realized gains or losses by the difference between the net proceeds from the repayment or sale and the amortized cost basis of the investment, using the specific identification method, without regard to unrealized appreciation or depreciation previously recognized, but considering prepayment penalties. Net change in unrealized appreciation or depreciation reflects, as applicable, the change in the fair values of our portfolio investments and the Credit Facility during the reporting period, including the reversal of previously recorded unrealized appreciation or depreciation, when gains or losses are realized.
We record interest income on an accrual basis to the extent that we expect to collect such amounts. For loans and debt investments with contractual PIK interest, which represents interest accrued and added to the loan balance that generally becomes due at maturity, we will generally not accrue PIK interest when the portfolio company valuation indicates that such PIK interest is not collectable. We do not accrue as a receivable interest on loans and debt investments if we have reason to doubt our ability to collect such interest. Loan origination fees, original issue discount ("OID"), market discount or premium and deferred financing costs on liabilities, which we do not fair value, are capitalized and then accreted or amortized using the effective interest method as interest income or, in the case of deferred financing costs, as interest expense. We record prepayment penalties earned on loans and debt investments as income. Dividend income, if any, is recognized on an accrual basis on the ex-dividend date to the extent that we expect to collect such amounts. From time to time, the Company receives certain fees from portfolio companies, which may or may not be recurring in nature. Such fees include loan prepayment penalties, structuring fees, amendment fees, and agency fees and are recorded as other investment income when earned.
Loans are placed on non-accrual status when principal or interest payments are past due 30 days or more and/or if there is reasonable doubt that principal or interest will be collected. Accrued interest is generally reversed when a loan is placed on non-accrual status. Interest payments received on non-accrual loans may be recognized as income or applied to principal depending upon management’s judgment. Non-accrual loans are restored to accrual status when past due principal and interest is paid and, in management’s judgment, are likely to remain current. As of June 30, 2025, we had four portfolio companies on non-accrual status, representing 2.8% of overall portfolio on a cost and 0.7% fair value basis. As of September 30, 2024, we had two portfolio companies on non-accrual status, representing 4.1% and 2.3% of our overall portfolio on a cost and fair value basis, respectively.
We have complied with the requirements of Subchapter M of the Code and have qualified to be treated as a RIC for federal income tax purposes. In this regard, we account for income taxes using the asset and liability method prescribed by ASC Topic 740, Income Taxes, or ASC 740. Under this method, income taxes are provided for amounts currently payable and for amounts deferred as tax assets and liabilities based on differences between the financial statement carrying amounts and the tax basis of existing assets and liabilities. Based upon our qualification and election to be treated as a RIC for U.S. federal income tax purposes, we typically do not incur material federal income taxes. However, we may choose to retain a portion of our calendar year income, which may result in the imposition of an excise tax. Additionally, certain of the Company’s consolidated subsidiaries are subject to federal, state and local income taxes. For the three and nine months ended June 30, 2025, we recorded a provision for taxes on net investment income of $0.7 million and $1.9 million respectively, which pertains to U.S. federal excise tax. For the three and nine months ended June 30, 2024, we recorded a provision for taxes on net investment income of $0.7 million and $1.9 million respectively, which pertains to U.S. federal excise tax.
We recognize the effect of a tax position in our Consolidated Financial Statements in accordance with ASC 740 when it is more likely than not, based on the technical merits, that the position will be sustained upon examination by the applicable tax authority. Tax positions not considered to satisfy the “more-likely-than-not” threshold would be recorded as a tax expense or benefit. Penalties or interest, if applicable, that may be assessed relating to income taxes would be classified as other operating expenses in the financial statements. There were no tax accruals relating to uncertain tax positions and no amounts accrued for any related interest or penalties with respect to the periods presented herein. The Company’s determinations regarding ASC 740 may be subject to review and adjustment at a later date based upon factors including, but not limited to, an on-going analysis of tax laws, regulations and interpretations thereof. Although the Company files both federal and state income tax returns, the Company’s major tax jurisdiction is federal.
Holdings II, is subject to U.S. federal, state and local corporate income taxes. The income tax expense and related tax liabilities of the Taxable Subsidiary are reflected in the Company’s consolidated financial statements.
For the three and nine months ended June 30, 2025, the Company recognized a provision for taxes of less than ($0.1) million and $(0.1) million on net realized gain (loss) on investments by the Taxable Subsidiary, respectively. For the three and nine months ended June 30, 2024, the Company recognized a provision for taxes of zero and $(0.2) million, respectively, on net realized gain (loss) on investments by the Taxable Subsidiary. For the three and nine months ended June 30, 2025, the Company recognized a provision for taxes of zero and zero, on net unrealized gain (loss) on investments by the Taxable Subsidiary, respectively. For the three and nine months ended June 30, 2024, the Company recognized a provision for taxes of zero and $(0.7) million, respectively, on net unrealized gain (loss) on investments by the Taxable Subsidiary. The provision for taxes on net realized and unrealized gains on investments is the result of netting (i) the expected tax liability on the gains from the sales of investments which is likely to be realized and unrealized during fiscal year ending and (ii) the expected tax benefit resulting from the use of loss carryforwards to offset such gains.
During the three and nine months ended June 30, 2025, the Company paid $0.2 million and $0.2 million, in federal taxes on realized gains on the sale of investments held by the Taxable Subsidiary, respectively. The state and local tax liability is $0.1 million as of June 30, 2025 is included under accrued other expenses in the consolidated statement of assets and liabilities.
We operate in a manner to maintain our election to be subject to tax as a RIC and to eliminate corporate-level U.S. federal income tax (other than the 4% excise tax) by distributing sufficient investment company taxable income and capital gain net income (if any). As a result, we will have an effective tax rate equal to 0% before the excise tax and income taxes incurred by the Taxable Subsidiary. As such, a reconciliation of the differences between our reported income tax expense and its tax expense at the federal statutory rate of 21% is not meaningful.
Because federal income tax regulations differ from GAAP, distributions characterized in accordance with tax regulations may differ from net investment income and net realized gains recognized for financial reporting purposes. Differences between tax regulations and GAAP may be permanent or temporary. Permanent differences are reclassified among capital accounts in the Consolidated Financial Statements to reflect their tax character. Temporary differences arise when certain items of income, expense, gain or loss are recognized at some time in the future.
Distributions to common stockholders are recorded on the ex-dividend date. The amount to be paid, if any, as a distribution is determined by our board of directors each quarter and is generally based upon the earnings estimated by management. Net realized capital gains, if any, are distributed at least annually. The tax attributes for distributions will generally include ordinary income and capital gains but may also include certain tax-qualified dividends and/or a return of capital.
Capital transactions, in connection with our dividend reinvestment plan or through offerings of our common stock, are recorded when issued and offering costs are charged as a reduction of capital upon issuance of our common stock.
On June 4, 2024, we entered into equity distribution agreements with Truist Securities, Inc. and Keefe, Bruyette & Woods, Inc. (together, the "Equity Distribution Agreements"), as sales agents (each a "Sales Agent" and together, the "Sales Agents") in connection with the sale of shares of our common stock, with an aggregate offering price of up to $100 million under an at-the-market offering ("ATM Program"). We may offer and sell shares of our common stock from time to time through a Sales Agent in amounts and at times to be determined by us. Actual sales will depend on a variety of factors to be determined by us from time to time, including, market conditions and the trading price of our common stock. The Investment Adviser may, from time to time, in its sole discretion, pay some or all of the commissions payable under the Equity Distribution Agreements or make additional supplemental payments to ensure that the sales price per share of our common stock in connection with all of the offerings made hereunder will not be less than our current NAV per share. Any such payments made by the Investment Adviser will not be subject to reimbursement by us.
During the three and nine months ended June 30, 2025, we did not issue any shares under the ATM program. During the three and nine months ended June 30, 2024, we issued 71,594 shares of common stock through the ATM Program at an average price of $7.72 per share raising $0.6 million of net proceeds offer commission to the sales agents and inclusive of proceeds from the Investment Adviser to ensure all shares were sold at or above NAV. In connection with the share issuance, we expensed $0.3 million of deferred offering costs incurred related to establishing the ATM program to additional paid in capital. On April 28, 2025, our registration statement pursuant to which shares were issued under the ATM Program expired.
Our books and records are maintained in U.S. dollars. Any foreign currency amounts are translated into U.S. dollars on the following basis:
29
Although net assets and fair values are presented based on the applicable foreign exchange rates described above, we do not isolate that portion of the results of operations due to changes in foreign exchange rates on investments, other assets and debt from the fluctuations arising from changes in fair values of investments and liabilities held. Such fluctuations are included with the net realized and unrealized gain or loss from investments and liabilities.
Foreign security and currency translations may involve certain considerations and risks not typically associated with investing in U.S. companies and U.S. government securities. These risks include, but are not limited to, currency fluctuations and revaluations and future adverse political, social and economic developments, which could cause investments in foreign markets to be less liquid and prices to be more volatile than those of comparable U.S. companies or U.S. government securities.
As permitted under Regulation S-X and as explained by ASC paragraph 946-810-45-3, PennantPark Investment will generally not consolidate its investment in a company other than an investment company subsidiary or a controlled operating company whose business consists of providing services to us. Accordingly, we have consolidated the results of our Taxable Subsidiary in our Consolidated Financial Statements. We do not consolidate our non-controlling interests in PSLF or PTSF II. See further description of our investment in PSLF in Note 4.
Asset transfers that do not meet ASC Topic 860, Transfers and Servicing, requirements for sale accounting treatment are reflected in the Consolidated Statements of Assets and Liabilities and the Consolidated Schedules of Investments as investments.
(h) Recent Accounting Pronouncements
In March 2020, the FASB issued ASU 2020-04, “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting.” The guidance provides optional expedients and exceptions for applying GAAP to contract modifications, hedging relationships and other transactions, subject to meeting certain criteria, that reference LIBOR or another reference rate expected to be discontinued because of the reference rate reform. ASU 2020-04 is effective for all entities as of March 12, 2020 through June 30, 2023. The FASB approved an (optional) two year extension to December 31, 2024, for transitioning away from LIBOR. The Company utilized the optional expedients and exceptions provided by ASU 2020-04 during the three and nine months ended June 30, 2025, the effect of which was not material to the consolidated financial statements.
In June 2022, the FASB issued ASU 2022-03, Fair Value Measurement (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions ("ASU 2022-03"), which changed the fair value measurement disclosure requirements of ASC Topic 820, Fair Value Measurements and Disclosures ("ASC 820"). The amendments clarify that a contractual restriction on the sale of an equity security is not considered part of the unit of account of the equity security and, therefore, is not considered in measuring fair value. The amendments also clarify that an entity cannot, as a separate unit of account, recognize and measure a contractual sale restriction. The new guidance is effective for fiscal years beginning after December 15, 2023, including interim periods therein. Early application is permitted. The Company has adopted the new accounting standard, the effect was not material to the consolidated financial statements.
In November 2023, FASB issued ASU 2023-07, Segment Reporting (Topic 280), Improvements to Reportable Segment Disclosures to improve reportable segment disclosure requirements through enhanced disclosures about significant segment expenses. ASU 2023-07 expands public entities' segment disclosure by requiring disclosure of significant segment expenses that are regularly provided to the chief operating decision maker and included within each reported measure of segment profit or loss, an amount and description of its composition for other segment items and interim disclosure of a reportable segment's profit or loss and assets. All disclosure requirements of ASU 2023-07 are required for entities with a single reportable segment. ASU 2023-07 is effective for fiscal years beginning after December 15, 2023, and interim periods for fiscal years beginning December 15, 2024, and should be applied on a retrospective basis to all periods presented, noting early adoption is permitted. The Company is currently evaluating the impact of this standard on its consolidated financial statements.
In December 2023, the FASB issued ASU 2023 - 09 "Improvements to Income Tax Disclosures" ("ASU 2023 - 09"). ASU 2023 - 09 intends to improve the transparency of income tax disclosures. ASU 2023 - 09 is effective for fiscal years beginning after December 15, 2024 and is to be adopted on a prospective basis with the option to apply retrospectively. We are currently assessing the impact of this guidance, however, we do not expect a material impact to our consolidated financial statements.
3. AGREEMENTS AND RELATED PARTY TRANSACTIONS
(a) Investment Management Agreement
The Investment Management Agreement with the Investment Adviser was reapproved by our board of directors, including a majority of our directors who are not interested persons of us or the Investment Adviser, in May 2025. Under the Investment Management Agreement, the Investment Adviser, subject to the overall supervision of our board of directors, manages the day-to-day operations of and provides investment advisory services to, us. For providing these services, the Investment Adviser receives a fee from us, consisting of two components— a base management fee and an incentive fee or, collectively, Management Fees.
Base Management Fee
The base management fee is calculated at an annual rate of 1.50% of our “average adjusted gross assets,” which equals our gross assets (exclusive of U.S. Treasury Bills, temporary draws under any credit facility, cash and cash equivalents, repurchase agreements or other balance sheet transactions undertaken at the end of a fiscal quarter for purposes of preserving investment flexibility for the next quarter and unfunded commitments, if any) and is payable quarterly in arrears. In addition, on November 13, 2018, in connection with our board of directors’ approval of the application of the modified asset coverage requirements under the 1940 Act to the Company, our board of directors approved an amendment to the Investment Management Agreement reducing the Investment Adviser’s annual base management fee from 1.50% to 1.00% on gross assets that exceed 200% of the Company’s total net assets as of the immediately preceding quarter-end. This amendment became effective on February 5, 2019 with the amendment and restatement of the Investment Management Agreement on April 12, 2019. The base management fee is calculated based on the average adjusted gross assets at the end of the two most recently completed calendar quarters, and appropriately adjusted for any share issuances or repurchases during the current calendar quarter. For example, if we sold shares on the 45th day of a quarter and did not use the proceeds from the sale to repay outstanding indebtedness, our gross assets for such quarter would give effect to the net proceeds of the issuance for only 45 days of the quarter during which the additional shares were outstanding. For the three and nine months ended June 30, 2025, we recorded base management fees of $3.9 million and $12.2 million, respectively. For the three and nine months ended June 30, 2024, we recorded base management fees of $4.2 million and $12.4 million, respectively.
Incentive Fee
The incentive fee has two parts, as follows:
One part is calculated and payable quarterly in arrears based on our Pre-Incentive Fee Net Investment Income for the immediately preceding calendar quarter. For this purpose, Pre-Incentive Fee Net Investment Income means interest income, dividend income and any other income, including any other fees (other than fees for providing managerial assistance), such as amendment, commitment, origination, prepayment penalties, structuring, diligence and consulting fees or other fees received from portfolio companies, accrued during the calendar quarter, minus our operating expenses for the quarter (including the base management fee, any expenses payable under the Administration Agreement and any interest expense or amendment fees under any credit facility and distribution paid on any issued and outstanding preferred stock, but excluding the incentive fee). Pre-Incentive Fee Net Investment Income includes, in the case of investments with a deferred interest feature (such as OID, debt instruments with PIK interest and zero-coupon securities), accrued income not yet received in cash. Pre-Incentive Fee Net Investment Income does not include any realized capital gains, computed net of all realized capital losses or unrealized capital appreciation or depreciation. Pre-Incentive Fee Net Investment Income, expressed as a percentage of the value of our net assets at the end of the immediately preceding calendar quarter, is compared to the hurdle rate of 1.75% per quarter (7.00% annualized). We pay the Investment Adviser an incentive fee with respect to our Pre- Incentive Fee Net Investment Income in each calendar quarter as follows: (1) no incentive fee in any calendar quarter in which our Pre-Incentive Fee Net Investment Income does not exceed the hurdle rate of 1.75%, (2) 100% of our Pre-Incentive Fee Net Investment Income with respect to that portion of such Pre-Incentive Fee Net Investment Income, if any, that exceeds the hurdle rate but is less than 2.1212% in any calendar quarter (8.4848% annualized), and (3) 17.5% of the amount of our Pre-Incentive Fee Net Investment Income, if any, that exceeds 2.1212% in any calendar quarter. These calculations are pro-rated for any share issuances or repurchases during the relevant quarter, if applicable.
For the three and nine months ended June 30, 2025, we recorded an incentive fee of $2.5 million and $7.7 million, respectively, related to incentive fees on net investment income. For the three and nine months ended June 30, 2024, we recorded an incentive fee of $3.3 million and $9.7 million, related to incentive fees on net investment income.
The second part of the incentive fee is determined and payable in arrears as of the end of each calendar year (or upon termination of the Investment Management Agreement, as of the termination date) and, effective January 1, 2018, equals 17.5% of our realized capital gains, (20.0% for periods prior to January 1, 2018), if any, on a cumulative basis from inception through the end of each calendar year, computed net of all realized capital losses and unrealized capital depreciation on a cumulative basis, less the aggregate amount of any previously paid capital gain incentive fees. For each of the three and nine months ended June 30, 2025 and 2024, we did not accrue an incentive fee on capital gains.
Under GAAP, we are required to accrue a capital gains incentive fee based upon net realized capital gains and net unrealized capital appreciation and depreciation on investments held at the end of each period. In calculating the capital gains incentive fee accrual, we considered the cumulative aggregate unrealized capital appreciation in the calculation, as a capital gains incentive fee would be payable if such unrealized capital appreciation were realized, even though such unrealized capital appreciation is not permitted to be considered in calculating the fee actually payable under the Investment Management Agreement. This accrual is calculated using the aggregate cumulative realized capital gains and losses and cumulative unrealized capital appreciation or depreciation. If such amount is positive at the end of a period, then we record a capital gains incentive fee equal to 17.5% of such amount, less the aggregate amount of actual capital gains related to incentive fees paid in all prior years, if any. If such amount is negative, then there is no accrual for such year. There can be no assurance that such unrealized capital appreciation will be realized in the future. For each of the three and nine months ended June 30, 2025 and 2024, we did not accrue an incentive fee on capital gains as calculated under GAAP.
(b) Administration Agreement
The Administration Agreement with the Administrator was reapproved by our board of directors, including a majority of our directors who are not interested persons of us, in May 2025. Under the Administration Agreement, the Administrator provides administrative services and office facilities to us. For providing these services, facilities and personnel, we have agreed to reimburse the Administrator for our allocable portion of overhead and other expenses incurred by the Administrator in performing its obligations under the Administration Agreement, including rent and our allocable portion of the costs of compensation and related expenses of our Chief Financial Officer, Chief Compliance Officer, and their respective staffs. The amount billed by the Administrator may include credits related to its administrative agreement with PSLF. The Administrator also offers, on our behalf, significant managerial assistance to portfolio companies to which we are required to offer such assistance. Reimbursement for certain of these costs is included in administrative services expenses in the Consolidated Statements of Operations. For the three and nine months ended June 30, 2025, we recorded $0.4 million and $1.1 million, respectively, for the services described above. For the three and nine months ended June 30, 2024, we recorded $0.5 million and $1.2 million, respectively, for the services described above.
Under the Administration Agreement, the Administrator may be reimbursed by the Company for the costs and expenses to be borne by the Company set forth above include the costs and expenses allocable with respect to the provision of in-house legal, tax, or other professional advice and/or services to the Company, including performing due diligence on its prospective portfolio companies as deemed appropriate by the Administrator, where such in-house personnel perform services that would be paid by the Company if outside service providers provided the same services, subject to the Board's oversight.
(c) Other Related Party Transactions
The Company, the Investment Adviser and certain other affiliates have been granted an order for exemptive relief by the SEC for the Company to co-invest with other funds managed by the Investment Adviser. If we co-invest with other affiliated funds, our Investment Adviser would not receive compensation except to the extent permitted by the exemptive order and applicable law, including the limitations set forth in Section 57(k) of the 1940 Act.
There were no transactions subject to Rule 17a-7 under the 1940 Act during each of the three and nine months ended June 30, 2025 and 2024.
For the three and nine months ended June 30, 2025, we sold $21.8 million and $462.8 million in investments to PSLF at fair value, respectively, and recognized less than $0.1 million and $0.9 million of net realized gains, respectively. For the three and nine months ended June 30, 2024, we sold $37.8 million and $191.8 million in investments to PSLF at fair value, and recognized less than $0.1 million and $0.1 million of net realized gains, respectively of net realized gains, respectively.
For the three and nine months ended June 30, 2025, we sold zero in investments to PTSF II at fair value, respectively, and recognized zero of net realized gains, respectively. For the three and nine months ended June 30, 2024, we sold zero in investments to PTSF II at fair value, respectively, and recognized zero and of net realized gains, respectively.
As of June 30, 2025 and September 30, 2024, PNNT had a payable to PSLF zero and less than $0.1 million, respectively, presented as a due to affiliate on the consolidated statement of assets and liabilities. These amounts are related to cash owed to PSLF from PNNT in connection with trades between the funds.
As of June 30, 2025 and September 30, 2024, PNNT had a receivable from affiliates of less than $0.1 million and $0.2 million, respectively, presented as a due from affiliates on the consolidated statement of assets and liabilities. These amounts are related to agency fees collected on behalf of the Company and trades between the funds.
4. INVESTMENTS
Purchases of investments, including PIK interest, for the three and nine months ended June 30, 2025 totaled $89.6 million and $565.9 million, respectively (excluding U.S. Government Securities). For the three and nine months ended June 30, 2024, purchases of investments, including PIK interest, totaled $167.5 million and $589.1 million, respectively (excluding U.S. Government Securities). Sales and repayments of investments for the three and nine months ended June 30, 2025 totaled $132.2 million and $749.0 million, respectively (excluding U.S. Government Securities). For the three and nine months ended June 30, 2024, sales and repayments of investments totaled $132.9 million and $380.1 million, respectively (excluding U.S. Government Securities).
Investments and cash and cash equivalents consisted of the following:
Investment Classification ($ in thousands)
Fair Value
First lien
505,370
476,461
700,390
667,926
U.S. Government Securities
Second lien
68,470
Subordinated debt / corporate notes
53,636
53,884
65,865
65,804
Subordinated notes in PSLF
Equity
206,282
284,954
199,173
243,699
Equity in PSLF
Total investments
Cash and cash equivalents
Total investments and cash and cash equivalents
The table below describes investments by industry classification by cost and fair value and enumerates the percentage, by fair value and total net asset value in such industries as of:
June 30, 2025 (1)
September 30, 2024 (1)
Industry Classification
Fair Value Percentage
Net Asset Value Percentage
57,211
139,067
120,378
165,304
113,736
134,132
124,430
127,574
142,399
133,262
205,232
184,233
70,126
73,534
69,915
71,527
54,904
52,736
89,773
89,743
38,840
45,532
53,472
54,017
56,848
28,701
51,402
44,290
26,589
28,484
39,449
40,752
16,383
18,647
17,203
18,850
17,952
18,092
31,964
32,130
0
22,349
16,810
35,986
34,045
14,501
14,185
10,091
9,834
13,185
13,460
8,449
12,577
12,668
12,686
12,713
12,520
12,470
12,515
12,442
14,846
12,402
32,255
31,598
11,849
12,033
7,339
7,489
9,663
2,643
6,524
14,887
19,633
9,697
6,521
5,966
All Other
43,780
22,685
84,260
69,740
Total
908,617
958,007
100
199
1,133,551
1,144,241
232
PennantPark Senior Loan Fund, LLC
In July 2020, we and Pantheon formed PSLF, an unconsolidated joint venture as a Delaware limited liability company. PSLF invests primarily in middle-market and other corporate debt securities consistent with its strategy. As of June 30, 2025 and September 30, 2024, PSLF had total assets of $1,389.2 million and $1,073.4 million, respectively and its investment portfolio consisted of debt investments in 115 and 102 portfolio companies, respectively. As of June 30, 2025, we and Pantheon had remaining commitments to fund subordinated notes of $8.2 million and $11.7 million, respectively, and equity interest of $5.0 million and $7.1 million, respectively, in PSLF. As of September 30, 2024, we and Pantheon had remaining commitments to fund subordinated notes of $32.6 million and $46.5 million, respectively, and equity interests of $19.9 million and $28.5 million, respectively, in PSLF. As of June 30, 2025, at fair value, the largest investment in a single portfolio company in PSLF was $30.9 million and the five largest investments totaled $128.6 million. As of September 30, 2024, at fair value, the largest investment in a single portfolio company in PSLF was $25.1 million and the five largest investments totaled $109.9 million. PSLF invests in portfolio companies in the same industries in which we may directly invest.
We provide capital to PSLF in the form of subordinated notes and equity interests. As of June 30, 2025, we and Pantheon owned 55.8% and 44.2%, respectively, of each of the outstanding subordinated notes and equity interests of PSLF. As of September 30, 2024, we and Pantheon owned 60.5% and 39.5%, respectively, of each of the outstanding subordinated notes and equity interest of PSLF. As of June 30, 2025, our investment in PSLF consisted of subordinated notes of $140.3 million and equity interests of $82.4 million, respectively. As of September 30, 2024, our investment in PSLF consisted of subordinated notes of $115.9 million and equity interests of $67.4 million respectively.
We and Pantheon each appointed two members to PSLF’s four-person Member Designees’ Committee, or the Member Designees’ Committee. All material decisions with respect to PSLF, including those involving its investment portfolio, require unanimous approval of a quorum of the Member Designees’ Committee. Quorum is defined as (i) the presence of two members of the Member Designees’ Committee; provided that at least one individual is present that was elected, designated or appointed by each of us and Pantheon; (ii) the presence of three members of the Member Designees’ Committee, provided that the individual that was elected, designated or appointed by each of us or Pantheon, as the case may be, with only one individual present being entitled to cast two votes on each matter; and (iii) the presence of four members of the Member Designees’ Committee constitute a quorum, provided that the two individuals are present that were elected, designated or appointed by each of us and Pantheon.
Additionally, PSLF, through its wholly-owned subsidiary, has entered into a $400.0 million (increased from $325.0 million in August 2024) senior secured revolving credit facility, with BNP Paribas, which bears interest at SOFR (or an alternative risk-free interest rate index) plus 225 basis points during the investment period and is subject to leverage and borrowing base restrictions.
In March 2022, PSLF completed a $304.0 million debt securitization in the form of a collateralized loan obligation, or the “2034 Asset-Backed Debt”. The 2034 Asset-Backed Debt is secured by a diversified portfolio of PennantPark CLO IV, LLC., a wholly-owned and consolidated subsidiary of PSLF, consisting primarily of middle market loans and participation interests in middle market loans. The 2034 Asset-Backed Debt is scheduled to mature in April 2034. On the closing date of the transaction, in consideration of PSLF’s transfer to PennantPark CLO IV, LLC of the initial closing date loan portfolio, which included loans distributed to PSLF by certain of its wholly owned subsidiaries and us, PennantPark CLO IV, LLC transferred to PSLF 100% of the Preferred Shares of PennantPark CLO IV, LLC and 100% of the subordinated notes issued by PennantPark CLO IV, LLC. As of June 30, 2025 and September 30, 2024 there were $246.0 million and $246.0 million, respectively, of external 2034 Asset-Backed Debt.
On July 26, 2023, CLO VII , LLC ("CLO VII") completed a $300 million debt securitization in the form of a collateralized loan obligation (the "2035 Debt Securitization" or "2035 Asset-Backed Debt"). The 2035 Asset-Backed Debt is secured by a diversified portfolio consisting primarily of middle market loans. The 2035 Debt Securitization was executed through a private placement of: (i) $151.0 million Class A-1a Notes maturing 2035, which bear interest at the three-month SOFR plus 2.7%, (ii) $20.0 million Class A-1b Loans 2035, which bear interest at 6.5%, (iii) $12.0 million Class A-2 Senior Secured Floating Rate Notes due 2035, which bear interest at the three-month SOFR plus 3.2%, (iv) $21.0 million Class B Senior Secured Floating Rate Notes due 2035, which bear interest at the three-month SOFR plus 4.1%, (v) $24.0 million Class C Secured Deferrable Floating Rate Notes due 2035, which bear interest at the three-month SOFR plus 4.7%, and (vi) $18.0 million Class D Secured Deferrable Floating Rate Notes due 2035, which bear interest at the three-month SOFR plus 7.0%. As of June 30, 2025 and September 30, 2024, there were $246.0 million and $246.0 million, respectively, of external 2035 Asset-Backed Debt.
On December 23, 2024, PennantPark CLO X, LLC ("CLO X”) completed a $400.5 million debt securitization in the form of a collateralized loan obligation (the "2037 Debt Securitization" or "2037 Asset-Backed Debt"). The 2037 Asset-Backed Debt is secured by a diversified portfolio consisting primarily of middle market loans. The 2037 Debt Securitization was executed through a private placement of: (i) $158.0 million Class A-1 Notes maturing 2037, which bear interest at the three-month SOFR plus 1.59%, (ii) $30.0 million Class A-1A Loans maturing 2037, which bear interest at the three-month SOFR plus 1.59%, (iii) $40.0 million Class A-1W Loans maturing 2037, which bear interest at the three-month SOFR plus 1.59%, (iv) $16.0 million Class A-2W Loans due 2037, which bear interest at the three-month SOFR plus 1.75%, (v) $28.0 million Class B Notes due 2037, which bear interest at the three-month SOFR plus 1.85%, (vi) $32.0 million Class C Notes due 2037, which bear interest at the three-month SOFR plus 2.40%., (vii) $24.0 million Class D Notes due 2037, which bear interest at the three-month SOFR plus 3.85%. As of June 30, 2025, there was $328.0 million of external 2037 Asset-Backed Debt.
On August 28, 2024, PSLF entered into an amendment (the “Amendment”) to PSLF’s limited liability company agreement (the “LLC Agreement”). The Amendment amended the term of PSLF, which would have otherwise expired on January 31, 2025, to be indefinite, subject to the other terms of dissolution, wind down and termination in the LLC Agreement. The Amendment also modified the LLC Agreement to permit any member of PSLF (each, a “PSLF Member”) to request to redeem its interests in PSLF (in minimum tranches of 25% of the interests then-owned by such PSFL Member) at any time. Under the Amendment, if a PSLF Member makes a redemption request, PSLF will be required to use commercially reasonable efforts to redeem any such PSFL Member’s interests within 18 months and, in any event, within three years from the date of such redemption request, subject to customary limitations with respect to the liquidity of PSLF and the requirement that the Company’s proportionate share or ownership of PSLF not exceed 87.5%.
Below is a summary of PSLF’s portfolio at fair value:
($ in thousands)
June 30, 2025 (Unaudited)
1,339,089
1,031,225
Weighted average cost yield on income producing investments
10.4
11.3
Number of portfolio companies in PSLF
115
102
Largest portfolio company investment at fair value
30,851
25,073
Total of five largest portfolio company investments at fair value
128,609
109,927
Below is a listing of PSLF’s individual investments as of June 30, 2025 (par and $ in thousands)
Issuer Name (3)
Basis PointSpread AboveIndex (1)
Par
Fair Value (2)
First Lien Secured Debt - 1009.7%
12/22/28
8.83%
SOFR+450
19,929
19,733
10/02/29
9.05%
SOFR+475
7,609
7,488
7,533
ACP Falcon Buyer, Inc.
08/01/29
9.80%
SOFR+550
15,235
14,991
15,387
04/09/27
9.82%
16,191
16,071
16,110
Ad.net Acquisition, LLC
05/07/26
10.56%
SOFR+626
4,800
08/16/29
SOFR+650
4,850
4,764
Alpine Acquisition Corp II
11/30/26
Containers, Packaging and Glass
SOFR+615
15,185
15,036
10,630
Amsive Holding Corporation (f/k/a Vision Purchaser Corporation)
12/10/26
10.67%
SOFR+635
13,773
13,722
13,635
Anteriad Holdings Inc (fka MeritDirect)
06/30/26
SOFR+590
14,056
14,014
Arcfield Acquisition Corp.
10/28/31
9.28%
SOFR+500
14,925
14,904
08/28/29
10.05%
SOFR+575
15,620
15,460
09/13/29
10.07%
14,888
14,764
14,754
BLC Holding Company, INC.
11/20/30
8.80%
12,043
11,971
06/21/29
24,670
24,354
24,423
Best Practice Associates, LLC
11/08/29
SOFR+675
19,900
19,648
19,651
07/02/29
14,588
14,405
14,259
Big Top Holdings, LLC
02/28/30
Manufacturing / Basic Industries
6,643
6,545
Bioderm, Inc.
01/31/28
10.82%
8,820
8,744
8,710
09/17/26
9.70%
SOFR+540
25,310
25,060
24,993
Boss Industries, LLC
12/27/30
9.30%
5,931
07/25/29
9.65%
SOFR+535
6,202
5,928
5,266
By Light professional IT Services, LLC
11/16/26
10.79%
SOFR+647
14,570
14,526
07/31/29
10.30%
SOFR+600
7,350
08/20/26
10.77%
SOFR+644
9,066
8,992
8,975
Carisk Buyer, Inc.
12/01/29
9.55%
SOFR+525
11,398
11,301
02/07/30
9.83%
22,713
22,412
22,485
06/14/28
21,937
21,750
Case Works, LLC
10/01/29
10,462
10,390
10,221
Commercial Fire Protection Holdings, LLC
09/23/30
9.06%
20,883
20,781
02/09/26
SOFR+555
11/30/28
11.83%
SOFR+750
1,955
Connatix Buyer, Inc.
07/13/27
9.97%
SOFR+576
8,637
08/16/27
9.69%
SOFR+536
5,285
5,254
5,245
08/31/27
9.66%
30,741
DRI Holding Inc.
12/21/28
9.68%
5,785
5,436
5,702
11/03/25
9.58%
4,629
4,627
4,597
09/30/30
4,963
4,922
Dynata, LLC - First Out Term Loan
07/17/28
SOFR+526
1,576
1,484
1,565
10/16/28
10.09%
9,695
01/10/29
23,228
22,961
23,286
05/29/29
12,155
11,986
Emergency Care Partners, LLC
10/18/27
6,948
6,910
Eval Home Health Solutions Intermediate, LLC
05/10/30
10.08%
7,199
7,110
03/15/27
10.68%
9,576
9,509
02/23/28
11.46%
SOFR+715
4,159
4,110
4,075
GGG Midco, LLC
09/27/30
12,517
12,406
Global Holdings InterCo LLC
03/16/26
Banking, Finance, Insurance & Real Estate
SOFR+560
6,610
6,605
08/10/27
9.90%
3,969
3,935
3,890
HEC Purchaser Corp.
06/17/29
9.72%
7,920
7,840
12/17/26
SOFR+
15,608
15,520
9,802
05/10/26
10.23%
23,813
23,739
12/31/26
6,029
5,998
08/09/30
9.33%
19,231
19,104
10.32%
14,184
14,023
09/22/28
4,361
4,313
4,328
Imagine Acquisitionco, LLC
11/15/27
9.42%
SOFR+510
5,466
5,413
5,453
12/28/28
13,785
13,648
11/01/26
13,050
13,004
Inovex Information Systems Incorporated
12/17/30
Inventus Power, Inc.
01/15/26
11.94%
SOFR+761
13,002
12,932
11/10/27
13,701
13,581
13,016
LAV Gear Holdings, Inc. (4)
10/31/25
4,761
4,690
3,566
LAV Gear Holdings, Inc. - Incremental TL
10.00%
294
02/18/27
12.13%
SOFR+785
21,248
21,181
20,823
02/03/27
20,166
20,079
02/01/30
9.07%
7,656
7,566
MAG DS Corp.
04/01/27
8,198
7,927
7,870
MDI Buyer Inc.
07/25/28
19,779
19,610
19,581
Magenta Buyer, LLC -First out
07/31/28
Software
11.29%
SOFR+701
375
Magenta Buyer, LLC -Second out
11.54%
SOFR+726
Magenta Buyer, LLC -Third out (5)
6.05%
2,194
12/19/30
9.47%
19,950
19,774
04/16/27
9.35%
8,266
8,214
12/10/27
SOFR+565
2,900
2,870
2,857
10/20/28
10.55%
SOFR+625
19,423
19,304
19,471
Megawatt Acquisitionco, Inc.
03/01/30
7,900
7,292
Michael Baker International, LLC
12/18/28
8.28%
SOFR+400
496
498
01/16/30
19,750
19,512
10/01/27
SOFR+515
9,599
9,529
NBH Group LLC
08/19/26
9.92%
7,174
08/31/29
10.65%
20,141
19,901
19,990
12/17/29
18,974
18,837
18,671
12/29/29
18,019
17,794
17,838
One Stop Mailing, LLC
05/07/27
10.69%
SOFR+636
8,297
8,213
5,768
5,700
5,797
PL Acquisitionco, LLC
11/09/27
SOFR+725
8,609
8,541
5,338
10/02/28
10.42%
12,805
12,624
12,664
09/03/30
9.32%
9,950
9,864
9,851
Project Granite Buyer, Inc.
12/31/30
5,985
5,932
6,045
08/15/29
9.54%
3,970
3,939
3,938
05/03/29
24,762
24,412
24,329
Radius Aerospace, Inc.
03/29/27
10.51%
11,811
11,744
11,515
06/20/29
22,779
22,705
Recteq, LLC
01/29/26
11.45%
9,575
9,553
9,527
Riverpoint Medical, LLC
06/21/27
3,901
3,900
Ro Health, LLC
01/17/31
9,935
Rural Sourcing Holdings, Inc. (HPA SPQ Merger Sub, Inc.)
06/16/29
Professional Services
10.04%
5,435
5,363
5,299
Sabel Systems Technology Solutions, LLC
10/31/30
11,842
Sales Benchmark Index LLC
07/07/26
SOFR+620
6,637
12/20/29
4,938
4,801
06/13/29
14,423
13,749
12/20/27
24,013
23,836
03/01/28
9,437
9,272
10/03/29
12.68%
SOFR+835
1,949
1,637
STG Distribution, LLC (fka Reception Purchaser) - Second Out Term Loans (5)
5.43%
4,514
2,594
1,354
SV- Aero Holdings, LLC (Aeronix)
11/01/30
14,813
14,750
System Planning and Analysis, Inc. (f/k/a Management Consulting & Research, LLC)
8.92%
16,960
16,847
16,824
01/23/29
9,875
9,750
TPC US Parent, LLC
11/24/25
11,305
11,286
11,293
9.53%
9,612
9,443
9,552
Teneo Holdings LLC
03/13/31
9.08%
2,963
2,934
2,988
The Bluebird Group LLC
07/27/26
17,261
17,206
08/31/28
9.31%
14,517
14,488
Transgo, LLC
12/29/28
17,051
16,890
17,137
Tyto Athene, LLC
04/01/28
9.19%
SOFR+490
11,342
11,270
11,070
06/15/27
12,412
12,351
12,362
10/07/31
8.78%
4,988
4,943
VRS Buyer, Inc.
11/21/30
8,946
Watchtower Buyer, LLC
23,173
22,963
23,149
04/30/28
9.50%
6,433
6,554
6,562
1,344,268
1,327,311
Subordinated Debt - 3.3%
Wash & Wax Systems LLC - Sub Debt
07/30/28
4,290
Equity Securities - 5.7%
134,330
2,351
2,347
48Forty Intermediate Holdings, Inc.- Common Equity
1,988
Wash & Wax Systems LLC (Common)
2,803
5,002
5,141
Total Equity Securities
7,353
Total Investments - 1018.7%
1,355,911
Cash and Cash Equivalents - 32.0%
JPMorgan U.S. Government Money Market Fund
4.09%
7,655
Goldman Sachs Financial Square Government Fund
4.18%
9,973
4.19%
3,073
21,412
42,113
Total Investments and Cash Equivalents - 1,050.7%
1,398,024
1,381,202
Liabilities in Excess of Other Assets — (950.7)%
(1,249,750
Members' Equity—100.0%
131,452
Below is a listing of PSLF’s individual investments as of September 30, 2024 (par and $ in thousands):
First Lien Secured Debt - 916.4%
10.95
SOFR+610
14,738
14,504
10.57
7,667
7,526
7,418
15,351
15,067
15,412
11.28
4,838
Aeronix, Inc. - Term Loan
9.85
AFC - Dell Holding Corp.
10.49
7,131
7,059
14,687
14,459
14,100
06/10/25
10.75
13,813
13,769
13,675
10.50
14,714
14,638
12/29/26
14,522
14,389
14,304
08/03/29
11.56
21,574
21,270
21,466
Beacon Behavioral Support Services, LLC
14,963
07/01/29
10.35
14,486
11.18
6,965
6,852
11.84
8,887
8,795
8,776
10.92
SOFR+640
20,504
20,245
20,152
BlueHalo Global Holdings, LLC
10.70
13,292
13,218
13,026
12/04/25
10.97
SOFR+611
9,374
4,874
4,625
11/30/29
5,473
5,400
5,390
9,810
9,801
17,106
16,879
11.21
SOFR+619
2,891
2,876
2,848
10.53
SOFR+561
8,716
8,702
10.71
SOFR+586
2,549
2,529
2,530
22,993
22,842
5,830
5,423
5,626
11.20
13,777
13,760
13,667
07/15/28
10.38
1,588
1,476
1,586
Dynata, LLC - Last Out Term Loan
10/15/28
10.88
8,993
11,144
11,013
10,977
12,249
12,049
10.85
7,396
7,293
7,322
9,651
9,556
9,603
Fairbanks Morse Defense
06/17/28
9.74
3,491
3,417
3,495
12.21
SOFR+710
4,241
4,175
11.43
6,952
6,940
3,118
3,081
3,087
6,146
6,023
9.75
7,887
7,924
Hills Distribution, Inc
11.11
14,292
14,106
14,149
12.00% (PIK 4.0%)
15,144
15,019
13,887
11.04
18,355
18,296
IG Investments Holdings, LLC
11.35
4,383
4,322
4,339
5,509
5,440
5,481
11.49
SOFR+685
13,890
13,730
14,029
10.10
12,286
12,214
12,194
06/30/25
12.46
13,101
12,980
12,905
13,520
11.66
4,613
4,601
12.94% (PIK 5.10%)
20,447
20,338
20,243
Lightspeed Buyer Inc.
02/03/26
14,267
14,170
01/31/30
10.48
6,255
6,151
7,890
7,770
12.13
425
12.38
SOFR+801
569
390
Magenta Buyer, LLC -Third out
11.63
2,109
10.67
SOFR+585
8,330
8,256
8,338
2,923
2,884
14,912
14,765
7,960
7,851
7,514
MOREgroup Holdings, LLC
12,450
12,303
12,263
9.77
5,912
5,822
11.19
7,311
7,133
14,597
10.01
9,650
9,622
5/7/2027
8,380
Owl Acquisition, LLC
2/4/2028
3,893
3,811
3,825
5/18/2026
11.12
SOFR+651
9,340
9,307
10/2/2028
11.51
12,903
12,682
12,877
PCS Midco, Inc.
3/1/2030
10.81
5,812
5,735
11/9/2027
11.99% (PIK 3.5%)
8,193
8,100
3,280
3,245
3,263
5/3/2029
19,673
19,551
3/31/2025
12,565
12,543
12,313
5,530
4/28/2028
25.00
4,937
3,703
1/29/2026
11.75
9,592
9,554
6/21/2025
3,932
3,919
3,936
6/16/2029
10.74
4,336
4,268
4,282
S101 Holdings Inc.
11.48
6,467
6,387
6,402
1/3/2025
10.80
6,676
6,668
Sargent & Greenleaf Inc.
12.45% (PIK 1.00%)
SOFR+760
4,634
6/13/2029
14,510
14,186
SOFR+690
14,621
14,465
14,475
Simplicity Financial Marketing Group Holdings, Inc
12/2/2026
11.38
11,359
11,207
11,472
Skopima Consilio Parent, LLC
5/17/2028
9.46
SOFR+461
1,290
1,269
1,289
Smartronix, LLC
11/23/2028
25,078
24,798
Solutionreach, Inc.
7/17/2025
12.40
9,239
9,216
SpendMend Holdings, LLC
3/1/2028
10.26
9,510
9,302
Summit Behavioral Healthcare, LLC
11/24/2028
9.31
SOFR+425
3,554
3,398
3,305
8/16/2027
15,803
15,600
15,772
1/23/2029
11.10
9,800
11/24/2025
10.98
11,392
11,330
6/6/2025
11.33
1,568
1,567
9,661
9,462
9,537
3/13/2031
9.60
2,985
2,955
2,994
7/27/2026
11.25
SOFR+665
14,445
14,404
8/31/2027
10.99
7,536
14,479
14,282
4/3/2028
10.23
11,393
11,306
11,165
6/15/2026
10,928
10,836
10,819
12/1/2029
13,942
13,803
2/27/2027
19,256
19,126
12.46% (PIK 1.5%)
SOFR+740
19,687
18,801
1,033,954
1,028,874
Equity Security - 2.1%
Dynata, LLC - Common Equity
Total Investments - 918.5%
1,036,305
Cash and Cash Equivalents - 32.6%
BlackRock Federal FD Institutional 30
36,595
Total Investments and Cash Equivalents - 951.1)%
1,072,900
1,067,820
Liabilities in Excess of Other Assets — (851.1)%
(955,549
112,271
38
Below are the consolidated statements of assets and liabilities for PSLF ($ in thousands):
Investments at fair value (amortized cost—$1,355,911 and $1,036,305, respectively)
Cash and cash equivalents (cost—$42,113 and $36,595, respectively)
5,561
2,406
372
42
71
1,389,211
1,073,352
2037 Asset-backed debt, net (par—$328,000 and $0, respectively and unamortized deferred financing cost of $1,977 and $0, respectively)
326,023
2034 Asset-backed debt, net (par—$246,000, unamortized deferred financing cost of $1,037 and $1,328, respectively)
244,963
244,672
2035 Asset-backed debt, net (par—$246,000, unamortized deferred financing cost of $1,589 and $1,882, respectively)
244,411
244,118
Credit facility payable
160,600
247,600
Subordinated notes payable to members
250,808
191,546
7,314
Interest payable on credit facility and asset backed debt
14,402
12,525
Distribution payable to members
Interest payable on subordinated notes to members
5,304
4,372
1,241
934
1,257,759
961,081
Members' equity
Total liabilities and members' equity
———————————
Below are the consolidated statements of operations for PSLF ($ in thousands):
36,203
28,866
104,583
83,812
222
1,142
36,516
29,088
105,725
84,508
Interest expense on credit facility and asset-backed debt
17,881
50,818
39,613
Interest expense on subordinated notes to members
7,788
6,450
22,565
18,361
Administration fees
778
2,745
173
725
Total expenses
26,910
21,168
76,997
60,647
9,606
28,728
23,861
Realized and unrealized gain (loss) on investments:
Net realized gain (loss) on investments
(3,416
(5,542
(3,439
(400
(11,743
1,935
Net realized and unrealized gain (loss) on investments
(6,855
(17,285
Net increase (decrease) in members' equity resulting from operations
2,751
7,520
11,443
25,796
(1) No management or incentive fees are payable by PSLF.
5. FAIR VALUE OF FINANCIAL INSTRUMENTS
Fair value, as defined under ASC 820, is the price that we would receive upon selling an investment or pay to transfer a liability in an orderly transaction to a market participant in the principal or most advantageous market for the investment or liability. ASC 820 emphasizes that valuation techniques maximize the use of observable market inputs and minimize the use of unobservable inputs. Inputs refer broadly to the assumptions that market participants would use in pricing an asset or liability, including assumptions about risk. Inputs may be observable or unobservable. Observable inputs reflect the assumptions market participants would use in pricing an asset or liability based on market data obtained from sources independent of us. Unobservable inputs reflect the assumptions market participants would use in pricing an asset or liability based on the best information available to us on the reporting period date.
ASC 820 classifies the inputs used to measure these fair values into the following hierarchies:
Level 1:
Inputs that are quoted prices (unadjusted) in active markets for identical assets or liabilities, accessible by us at the measurement date.
Level 2:
Inputs that are quoted prices for similar assets or liabilities in active markets, or that are quoted prices for identical or similar assets or liabilities in markets that are not active and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term, if applicable, of the financial instrument.
Level 3:
Inputs that are unobservable for an asset or liability because they are based on our own assumptions about how market participants would price the asset or liability.
A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Generally, most of our investments and our Truist Credit Facility are classified as Level 3. Our 2026 Notes and 2026 Notes-2 are classified as Level 2, as they are financial instruments with readily observable market inputs. Due to the inherent uncertainty of determining the fair value of investments that do not have a readily available market value, the price used in an actual transaction may be different than our valuation and those differences may be material.
The inputs into the determination of fair value may require significant management judgment or estimation. Even if observable market data is available, such information may be the result of consensus pricing information, disorderly transactions or broker quotes which include a disclaimer that the broker would not be held to such a price in an actual transaction. The non-binding nature of consensus pricing and/or quotes accompanied by disclaimer would result in classification as Level 3 information, assuming no additional corroborating evidence were available. Corroborating evidence that would result in classifying these non-binding broker/dealer bids as a Level 2 asset includes observable orderly market-based transactions for the same or similar assets or other relevant observable market-based inputs that may be used in pricing an asset.
Our investments are generally structured as debt and equity investments in the form of first lien secured debt, second lien secured debt, subordinated debt and equity investments. The transaction price, excluding transaction costs, is typically the best estimate of fair value at inception. Ongoing reviews by our Investment Adviser and independent valuation firms are based on an assessment of each underlying investment, incorporating valuations that consider the evaluation of financing and sale transactions with third parties, expected cash flows and market-based information including comparable transactions, performance multiples and yields, among other factors. These non-public investments valued using unobservable inputs are included in Level 3 of the fair value hierarchy.
A review of fair value hierarchy classifications is conducted on a quarterly basis. Changes in our ability to observe valuation inputs may result in a reclassification for certain financial assets or liabilities.
In addition to using the above inputs to value cash equivalents, investments, our 2026 Notes, our 2026 Notes-2 and our Truist Credit Facility, we employ the valuation policy approved by our board of directors which is consistent with ASC 820. Consistent with our valuation policy, we evaluate the source of inputs, including any markets in which our investments are trading, in determining fair value. See Note 2.
As outlined in the table below, some of our Level 3 investments using a market approach valuation technique are valued using the average of the bids from brokers or dealers. The bids include a disclaimer, may not have corroborating evidence, may be the result of a disorderly transaction and may be the result of consensus pricing. The Investment Adviser assesses the source and reliability of bids from brokers or dealers. If the board of directors has a bona fide reason to believe any such bids do not reflect the fair value of an investment, it may independently value such investment by using the valuation procedure that it uses with respect to assets for which market quotations are not readily available. In accordance with ASC 820, we do not categorize any investments for which fair value is measured using the net asset value per share within the fair value hierarchy.
The remainder of our investment portfolio and our long-term Truist Credit Facility are valued using a market comparable or an enterprise market value technique. With respect to investments for which there is no readily available market value, the factors that our board of directors may take into account in pricing our investments at fair value include, as relevant, the nature and realizable value of any collateral, the portfolio company’s ability to make payments, its earnings and discounted cash flow, the markets in which the portfolio company does business, comparison to publicly traded securities and other relevant factors. When an external event such as a purchase transaction, public offering or subsequent equity sale occurs, the pricing indicated by the external event, excluding transaction costs, is used to corroborate the valuation. When using earnings multiples to value a portfolio company, the multiple used requires the use of judgment and estimates in determining how a market participant would price such an asset. These non-public investments using unobservable inputs are included in Level 3 of the fair value hierarchy. Generally, the sensitivity of unobservable inputs or combination of inputs such as industry comparable companies, market outlook, consistency, discount rates and reliability of earnings and prospects for growth, or lack thereof, affects the multiple used in pricing an investment. As a result, any change in any one of those factors may have a significant impact on the valuation of an investment. Generally, an increase in a market yield will result in a decrease in the valuation of a debt investment, while a decrease in a market yield will have the opposite effect. Generally, an increase in an earnings before interest, taxes, depreciation and amortization ("EBITDA"), multiple will result in an increase in the valuation of an investment, while a decrease in an EBITDA multiple will have the opposite effect.
Our Level 3 valuation techniques, unobservable inputs and ranges were categorized as follows for ASC 820 purposes:
Asset Category ($ in thousands)
Fair value at June 30, 2025
Valuation Technique
Unobservable Input
Range of Input(Weighted Average) (1)
44,430
Market Comparable
Broker/Dealer bids or quotes
N/A
427,129
Market yield
7.0% - 20.6% (10.3%)
4,902
Enterprise Market Value
EBITDA multiple
7.0x - 7.8x (7.5x)
14,600
13.6% - 17.1% (15.2%)
194,172
6.3% - 23.3% (13.1%)
277,776
0.4x - 18.0x (9.5x)
Total Level 3 investments
966,420
Debt Category ($ in thousands)
Truist Credit Facility
5.6%
Fair value at September 30, 2024
13,841
621,998
7.0% – 21.4% (10.2%)
32,087
0.9x - 8.4x (8.4x)
63,803
13.1% - 18.5% (13.9%)
181,690
5.0% - 16.5% (14.1%)
235,573
0.4x - 18.8x (9.4x)
1,152,369
5.4%
Our investments, cash and cash equivalents, Truist Credit Facility, 2026 Notes and 2026 Notes-2 were categorized as follows in the fair value hierarchy:
Description ($ in thousands)
Level 1
Level 2
Level 3
Measured at Net Asset Value (1)
Debt investments
688,644
U.S. Government Securities(3)
Equity investments
358,283
80,507
2026 Notes(2)
2026 Notes-2(2)
Total debt
629,351
312,967
Fair Value at September 30, 2024
916,796
311,622
76,049
772,012
311,651
The tables below show a reconciliation of the beginning and ending balances for investments measured at fair value using significant unobservable inputs (Level 3):
Nine Months Ended June 30, 2025
Totals
Beginning balance
Net realized gain (loss)
(30,009
(725
(30,734
Net change in unrealized appreciation (depreciation)
4,579
35,095
39,674
Purchases, PIK interest, net discount accretion and non-cash exchanges
543,409
10,719
554,128
Sales, repayments and non-cash exchanges
(746,131
(2,886
(749,017
Transfers in/out of Level 3
Ending balance
Net change in unrealized appreciation reported within the net change in unrealized appreciation on investments in our consolidated statements of operations attributable to our Level 3 assets still held at the reporting date
(11,620
34,061
22,441
Nine Months Ended June 30, 2024
764,275
163,053
927,328
(23,256
(11,401
(34,657
(842
25,058
24,216
537,661
43,463
581,124
(372,683
(3,715
(376,398
905,155
216,458
1,121,613
(16,458
14,138
(2,320
The table below shows a reconciliation of the beginning and ending balances for liabilities measured at fair value using significant unobservable inputs (Level 3):
Nine months ended June 30,
Long-Term Credit Facility
Beginning balance (cost – $461,456 and $212,420, respectively)
206,940
Net change in unrealized appreciation (depreciation) included in earnings
Borrowings (1)
Repayments (1)
Transfers in and/or out of Level 3
Ending balance (cost – $316,456 and $450,456, respectively)
446,554
Temporary draws outstanding, at cost
As of June 30, 2025, we had outstanding non-U.S. dollar borrowings on our Truist Credit Facility:
Foreign Currency
Amount Borrowed
Borrowing Cost
Current Value
Reset Date
Unrealized appreciation/(depreciation)
British Pound
£
36,000
49,420
49,333
September 30, 2025
Canadian dollar
CAD 2,800
2,036
2,052
July 31, 2025
As of September 30, 2024, we had outstanding non-U.S. dollar borrowings on our Truist Credit Facility:
48,289
December 28, 2024
2,073
October 23, 2024
Generally, the carrying value of our consolidated financial liabilities approximates fair value. We have adopted the principles under ASC Subtopic 825-10, Financial Instruments ("ASC 825-10"), which provides companies with an option to report selected financial assets and liabilities at fair value, and made an irrevocable election to apply ASC 825-10 to the Truist Credit Facility. We elected to use the fair value option for the Truist Credit Facility to align the measurement attributes of both our assets and liabilities while mitigating volatility in earnings from using different measurement attributes. Due to that election and in accordance with GAAP, we incurred zero and $0.3 million of expenses relating to amendment costs on the Truist Credit Facility during the three and nine months ended June 30, 2025, respectively. Due to that election and in accordance with GAAP, we did not incur any expenses relating to amendment costs on the Truist Credit Facility during the three and nine months ended June 30, 2024. ASC 825-10 establishes presentation and disclosure requirements designed to facilitate comparisons between companies that choose different measurement attributes for similar types of assets and liabilities and to more easily understand the effect on earnings of a company’s choice to use fair value. ASC 825-10 also requires us to display the fair value of the selected assets and liabilities on the face of the Consolidated Statements of Assets and Liabilities and changes in fair value of the Truist Credit Facility is reported in our Consolidated Statements of Operations. We did not elect to apply ASC 825-10 to any other financial assets or liabilities, including the 2026 Notes and 2026 Notes-2.
For the three and nine months ended June 30, 2025, the Truist Credit Facility had a net change in unrealized appreciation (depreciation) of $(3.0) million and $(1.0) million, respectively. For the three and nine months ended June 30, 2024, the Truist Credit Facility had a net change in unrealized appreciation (depreciation) of less than $(0.1) million and $(1.6) million, respectively. As of June 30, 2025 and September 30, 2024, the unrealized appreciation (depreciation) on the Truist Credit Facility totaled $0.1 million and $1.1 million, respectively. We use an independent valuation service to measure the fair value of our Truist Credit Facility in a manner consistent with the valuation process that our board of directors uses to value our investments.
43
6. TRANSACTIONS WITH AFFILIATED COMPANIES
An affiliated portfolio company is a company in which we have ownership of 5% or more of its voting securities. A portfolio company is generally presumed to be a non-controlled affiliate when we own at least 5% but 25% or less of its voting securities and a controlled affiliate when we own more than 25% of its voting securities. Transactions related to our funded investments with both controlled and non-controlled affiliates for the nine months ended June 30, 2025 and 2024 were as follows ($ in thousands):
Name of Investment
GrossAdditions(1)
GrossReductions
Net Change inAppreciation /(Depreciation)
Fair Value at June 30, 2025
InterestIncome
PIKIncome
Dividend Income/Other
Net RealizedGains(Losses)
Controlled Affiliates
AKW Holdings Limited
60,798
16,073
76,871
4,828
Flock Financial, LLC
48,839
823
2,725
52,387
1,448
JF Intermediate, LLC (JF Holdings Corp.)
90,858
512
(49,625
36,714
Pragmatic Institute, LLC (3)
14,740
(71
(1,650
PennantPark Senior Loan Fund, LLC (2)
183,809
39,324
(9,516
213,617
12,798
Total Controlled Affiliates
55,399
(49,696
44,346
16,035
Non-Controlled Affiliates
(21,799
Walker Edison Furniture Company LLC
4,161
1,708
(5,848
Total Non-Controlled Affiliates
(27,647
Total Controlled and Non-Controlled Affiliates
417,727
57,107
441,837
Fair Value atSeptember 30, 2023
Fair Value at June 30, 2024
Dividend Income
51,660
3,787
57,344
2,893
Flock Financial, LLC (5)
32,300
20,006
(5,306
1,029
48,029
1,358
JF Intermediate, LLC (MidOcean JF Holdings Corp.) (2)
8,759
51,846
21,243
81,598
4,029
Mailsouth Inc.
(28,899
28,899
PennantPark Senior Loan Fund, LLC (3)
164,408
22,353
(1,158
185,603
11,109
RAM Energy LLC (4)
(1,270
257,127
96,102
(34,455
53,800
372,574
32,105
(4,541
27,564
13,907
2,470
(10,667
5,710
46,012
(15,208
33,274
303,139
98,572
405,848
2,831
7. CHANGE IN NET ASSETS FROM OPERATIONS PER COMMON SHARE
The following information sets forth the computation of basic and diluted per share net increase in net assets resulting from operations ($ in thousands, except per share data):
44
Numerator for net increase (decrease) in net assets resulting from operations
Denominator for basic and diluted weighted average shares
65,296,094
65,238,634
65,229,194
Basic and diluted net increase (decrease) in net assets per share resulting from operations
8. CASH AND CASH EQUIVALENTS
Cash equivalents represent cash in money market funds pending investment in longer-term portfolio holdings and for other general corporate purposes. Our portfolio may consist of temporary investments in U.S. Treasury Bills (of varying maturities), repurchase agreements, money market funds or repurchase agreement-like treasury securities. These temporary investments with original maturities of 90 days or less are deemed cash equivalents and are included in the Consolidated Schedule of Investments. At the end of each fiscal quarter, we may take proactive steps to preserve investment flexibility for the next quarter by investing in cash equivalents, which is dependent upon the composition of our total assets at quarter-end. We may accomplish this in several ways, including purchasing U.S. Treasury Bills and closing out positions on a net cash basis after quarter-end, temporarily drawing down on the Truist Credit Facility, or utilizing repurchase agreements or other balance sheet transactions as are deemed appropriate for this purpose. These amounts are excluded from average adjusted gross assets for purposes of computing the Investment Adviser’s management fee. U.S. Treasury Bills with maturities greater than 60 days from the time of purchase are valued consistent with our valuation policy. As of June 30, 2025, cash and cash equivalents consisted of money market funds, and non-money market funds in the amounts of $49.5 million and $21.0 million. As of September 30, 2024, cash and cash equivalents consisted of money market funds, and non-money market funds in the amounts of $38.8 million and $11.1 million at fair value, respectively.
9. FINANCIAL HIGHLIGHTS
Below are the financial highlights ($ in thousands, except share and per share data):
Per Share Data:
Net asset value, beginning of period
7.70
Net investment income (1)
Net change in realized and unrealized gain (loss) (1)
(0.04
(0.24
Net increase (decrease) in net assets resulting from operations (1) (8)
0.46
Distributions to stockholders (1), (2)
(0.72
(0.64
Net asset value, end of period
7.52
Per share market value, end of period
6.84
7.55
Total return* (3)
8.58
25.84
Shares outstanding at end of period
Ratios** / Supplemental Data:
Ratio of operating expenses to average net assets (4)
7.24
7.65
Ratio of debt related expenses to average net assets (5)
8.57
8.76
Ratio of total expenses to average net assets (5)
15.81
16.41
Ratio of net investment income to average net assets (5)
9.87
12.15
Net assets at end of period
Weighted average debt outstanding
690,420
675,406
Weighted average debt per share (1)
Asset coverage per unit (6)
1,761
Portfolio turnover ratio* (7)
49.84
30.03
* Not annualized for periods less than one year.
**Re-occurring investment income and expenses included in these ratios are annualized for periods less than one year.
***The expense and investment income ratios do not reflect the Company's proportionate share of income and expenses of PSLF and PTSF II.
10. DEBT
The annualized weighted average cost of debt for the nine months ended June 30, 2025 and 2024, inclusive of the fee on the undrawn commitment and amendment costs on the Truist Credit Facility and amortized upfront fees on 2026 Notes and 2026 Notes-2, was 6.1% and 6.5%, respectively. As of June 30, 2025, in accordance with the 1940 Act, with certain limited exceptions, we are only allowed to borrow amounts such that we are in compliance with a 150% asset coverage ratio after such borrowing.
On February 5, 2019, our stockholders approved the application of the modified asset coverage requirements set forth in Section 61(a)(2) of the 1940 Act, as amended by the Consolidated Appropriations Act of 2018 (which includes the Small Business Credit Availability Act, or "SBCAA") as approved by our board of directors on November 13, 2018. As a result, the asset coverage requirement applicable to us for senior securities was reduced from 200% (i.e., $1 of debt outstanding for each $1 of equity) to 150% (i.e., $2 of debt outstanding for each $1 of equity), subject to compliance with certain disclosure requirements. As of June 30, 2025 and September 30, 2024, our asset coverage ratio, as computed in accordance with the 1940 Act, was 176% and 164%, respectively.
45
As of June 30, 2025, we had the multi-currency Truist Credit Facility for up to $500 million (increased from $475 million in February 2025), which may be further increased up to $750.0 million in borrowings with certain lenders and Truist Bank, acting as administrative agent, Regions Bank, acting as an additional multicurrency lender, and JPMorgan Chase Bank, N.A., acting as syndication agent for the lenders. As of June 30, 2025 and September 30, 2024, we had $316.5 million and $461.5 million, respectively, in outstanding borrowings under the Truist Credit Facility. The Truist Credit Facility had a weighted average interest rate of 6.7% and 7.2%, respectively, exclusive of the fee on undrawn commitment, as of June 30, 2025 and September 30, 2024. The Truist Credit Facility is a revolving facility with a stated maturity date of July 29, 2027 and pricing set at 235 basis points over SOFR (or an alternative risk-free floating interest rate index). As of June 30, 2025 and September 30, 2024, we had $183.5 million and $13.5 million of unused borrowing capacity under the Truist Credit Facility, respectively, subject to leverage and borrowing base restrictions. The Truist Credit Facility is secured by substantially all of our assets. As of June 30, 2025, we were in compliance with the terms of the Truist Credit Facility.
2026 Notes
In April 2021, we issued $150.0 million in aggregate principal amount of our 2026 Notes at a public offering price per note of 99.4%. Interest on the 2026 Notes is paid semi-annually on May 1 and November 1 of each year, at a rate of 4.50% per year, commencing November 1, 2021. The effective interest rate is 4.62%. The 2026 Notes mature on May 1, 2026 and may be redeemed in whole or in part at our option subject to a make-whole premium if redeemed more than three months prior to maturity. The 2026 Notes are general, unsecured obligations and rank equal in right of payment with all of our existing and future senior unsecured indebtedness. The 2026 Notes are effectively subordinated to all of our existing and future secured indebtedness to the extent of the value of the assets securing such indebtedness and structurally subordinated to all existing and future indebtedness and other obligations of any of our subsidiaries, financing vehicles, or similar facilities. We do not intend to list the 2026 Notes on any securities exchange or automated dealer quotation system.
2026 Notes-2
In October 2021, we issued $165.0 million in aggregate principal amount of our 2026 Notes-2 at a public offering price per note of 99.4%. Interest on the 2026 Notes-2 is paid semi-annually on May 1 and November 1 of each year, at a rate of 4.00% per year, commencing May 1, 2022. The effective interest rate is 4.12%. The 2026 Notes-2 mature on November 1, 2026 and may be redeemed in whole or in part at our option subject to a make-whole premium if redeemed more than three months prior to maturity. The 2026 Notes-2 are general, unsecured obligations and rank equal in right of payment with all of our existing and future senior unsecured indebtedness. The 2026 Notes-2 are effectively subordinated to all of our existing and future secured indebtedness to the extent of the value of the assets securing such indebtedness and structurally subordinated to all existing and future indebtedness and other obligations of any of our subsidiaries, financing vehicles, or similar facilities. We do not intend to list the 2026 Notes-2 on any securities exchange or automated dealer quotation system.
11. COMMITMENTS AND CONTINGENCIES
From time to time, we, may be a party to legal proceedings, including proceedings relating to the enforcement of our rights under contracts with our portfolio companies. While the outcome of these legal proceedings cannot be predicted with certainty, we do not expect that these proceedings will have a material effect upon our financial condition or results of operations.
Unfunded debt and equity investments, if any, are disclosed in the Consolidated Schedules of Investments. Under these arrangements, we may be required to supply a letter of credit to a third party if the portfolio company were to request a letter of credit. As of June 30, 2025 and September 30, 2024, we had $322.0 million and $373.9 million, respectively, in commitments to fund investments. Additionally, the Company had unfunded commitments of up to $13.2 million and $52.5 million to PSLF as of June 30, 2025 and September 30, 2024, respectively, that may be contributed primarily for the purpose of funding new investments approved by PSLF board of directors or investment committee.
12. UNCONSOLIDATED SIGNIFICANT SUBSIDIARIES
We must determine which, if any, of our unconsolidated controlled portfolio companies is a "significant subsidiary" within the meaning of Regulation S-X. We have determined that, as of September 30, 2024, PennantPark Senior Loan Fund, LLC triggered at least one of the significance tests. As a result and in accordance with Rule 3-09 of Regulation S-X, separate audited financial statements of PSLF, LLC for the years ended September 30, 2024, 2023, and 2022 were filed as exhibits to our Annual Report on Form 10-K for the fiscal year ended September 30, 2024.
In December 2023, the JF Intermediate LLC became controlled affiliate. Below is certain selected key financial data from JF Intermediate, LLC's income statements for the periods in which our investment in JF Intermediate, LLC exceeded the threshold in at least one of the tests under Rule 3-09 of Regulation S-X (amounts in thousands).
JF Intermediate, LLC (Unaudited):
Income Statement
Total revenue
233,706
219,527
663,904
574,541
238,293
222,853
679,498
595,980
Net income (loss)
(4,587
(3,326
(15,594
(21,439
13. SUBSEQUENT EVENTS
In July 2025, PSLF through its wholly-owned and consolidated subsidiary, CLO VII, partially refinanced its $300 million debt securitization. The $21.0 million of Class B Loans interest was decreased from SOFR plus 4.05% to SOFR plus 1.95%, the $24.0 million of Class C Loans interest was decreased from SOFR plus 4.70% to SOFR plus 2.30%, and the $18.0 million of Class D interest was decreased from SOFR plus 7.00% to SOFR plus 3.35%.
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Report of Independent Registered Public Accounting Firm
To the Stockholders and the Board of Directors of
PennantPark Investment Corporation and its Subsidiaries
Results of Review of Interim Financial Statements
We have reviewed the accompanying consolidated statement of assets and liabilities of PennantPark Investment Corporation and its subsidiaries (the Company), including the consolidated schedules of investments, as of June 30, 2025, the related consolidated statements of operations and changes in net assets for the three month and nine-month periods ended June 30, 2025 and 2024, and cash flows for the nine-month periods ended June 30, 2025 and 2024, and the related notes to the consolidated financial statements (collectively, the interim financial information or financial statements). Based on our reviews, we are not aware of any material modifications that should be made to the financial statements referred to above for them to be in conformity with accounting principles generally accepted in the United States of America.
We have previously audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated statement of assets and liabilities of the Company, including the consolidated schedule of investments, as of September 30, 2024, and the related consolidated statements of operations, changes in net assets, and cash flows for the year then ended (not presented herein); and in our report dated November 25, 2024, we expressed an unqualified opinion on those financial statements. In our opinion, the information set forth in the accompanying consolidated statement of assets and liabilities, including the consolidated schedule of investments, as of September 30, 2024, is fairly stated, in all material respects, in relation to the consolidated statement of assets and liabilities, including the consolidated schedule of investments, from which it has been derived.
Basis for Review Results
These interim financial statements are the responsibility of the Company’s management. We conducted our reviews in accordance with the standards of the PCAOB. A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with the standards of the PCAOB, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
/s/ RSM US LLP
New York, New York
August 11, 2025
Awareness Letter of Independent Registered Public Accounting Firm
The Board of Directors and Stockholders
We have reviewed, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the unaudited interim financial information of PennantPark Investment Corporation and its subsidiaries for the periods ended June 30, 2025 and 2024, as indicated in our report dated August 11, 2025; because we did not perform an audit, we expressed no opinion on that information.
We are aware that our report referred to above, which is included in your Quarterly Report on Form 10-Q for the quarter ended June 30, 2025, is incorporated by reference in Registration Statement No. 333-263564 on Form N-2.
We are also aware that the aforementioned report, pursuant to Rule 436(c) under the Securities Act of 1933, is not considered a part of the Registration Statement prepared or certified by an accountant or a report prepared or certified by an accountant within the meaning of Sections 7 and 11 of that Act.
Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
FORWARD-LOOKING STATEMENTS
This Report, including Management’s Discussion and Analysis of Financial Condition and Results of Operations, contains statements that constitute forward-looking statements, which relate to us and our consolidated subsidiaries regarding future events or our future performance or future financial condition. These forward-looking statements are not historical facts, but rather are based on current expectations, estimates and projections about our Company, our industry, our beliefs and our assumptions. The forward-looking statements contained in this Report involve risks and uncertainties, including statements as to:
We use words such as “anticipates,” “believes,” “expects,” “intends,” “seeks,” “plans,” “estimates” and similar expressions to identify forward-looking statements. You should not place undue influence on the forward-looking statements as our actual results could differ materially from those projected in the forward-looking statements for any reason, including the factors in “Risk Factors” and elsewhere in this Report.
Although we believe that the assumptions on which these forward-looking statements are based are reasonable, any of those assumptions could prove to be inaccurate, and, as a result, the forward-looking statements based on those assumptions also could be inaccurate. Important assumptions include our ability to originate new loans and investments, certain margins and levels of profitability and the availability of additional capital. In light of these and other uncertainties, the inclusion of a projection or forward-looking statement in this Report should not be regarded as a representation by us that our plans and objectives will be achieved.
We have based the forward-looking statements included in this Report on information available to us on the date of this Report, and we assume no obligation to update any such forward-looking statements. Although we undertake no obligation to revise or update any forward-looking statements in this Report, whether as a result of new information, future events or otherwise, you are advised to consult any additional disclosures that we may make directly to you or through reports that we in the future may file with the SEC, including reports on Form 10-Q/K and current reports on Form 8-K.
You should understand that under Section 27A(b)(2)(B) of the Securities Act and Section 21E(b)(2)(B) of the Exchange Act, the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995 do not apply to forward-looking statements made in periodic reports we file under the Exchange Act.
The following analysis of our financial condition and results of operations should be read in conjunction with our Consolidated Financial Statements and the related notes thereto contained elsewhere in this Report.
Overview
PennantPark Investment Corporation is a BDC whose objectives are to generate both current income and capital appreciation while seeking to preserve capital through debt and equity investments primarily made to U.S. middle-market companies in the form of first lien secured debt, second lien secured debt, subordinated debt and equity investments.
We believe middle-market companies offer attractive risk-reward to investors due to a limited amount of capital available for such companies. We hold a diversified portfolio that includes first lien secured debt, second lien secured debt, subordinated debt and equity investments ranging from approximately $10 million to $50 million of capital, on average, in the securities of middle-market companies. We expect this investment size to vary proportionately with the size of our capital base. We use the term “middle-market” to refer to companies with annual revenues between $50 million and $1 billion. The companies in which we invest are typically highly leveraged, and, in most cases, are not rated by national rating agencies. If such companies were rated, we believe that they would typically receive a rating below investment grade (between BB and CCC under the Standard & Poor’s system) from the national rating agencies. Securities rated below investment grade are often referred to as “leveraged loans” or “high yield” securities or “junk bonds” and are often higher risk and have speculative characteristic compared to debt instruments that are rated above investment grade. Our debt investments may generally range in maturity from three to ten years and are made in U.S. and, to a limited extent, non-U.S. corporations, partnerships and other business entities which operate in various industries and geographical regions.
Our investment activity depends on many factors, including the amount of debt and equity capital available to middle-market companies, the level of merger and acquisition activity for such companies, the general economic environment and the competitive environment for the types of investments we make. We have used, and expect to continue to use, our debt capital, proceeds from the rotation of our portfolio and proceeds from public and private offerings of securities to finance our investment objectives.
Organization and Structure of PennantPark Investment Corporation
PennantPark Investment Corporation, a Maryland corporation organized in January 2007, is a closed-end, externally managed, non-diversified investment company that has elected to be treated as a BDC under the 1940 Act. In addition, for federal income tax purposes we have elected to be treated, and intend to qualify annually, as a RIC under the Code.
Our investment activities are managed by the Investment Adviser. Under our Investment Management Agreement, we have agreed to pay our Investment Adviser an annual base management fee based on our average adjusted gross assets as well as an incentive fee based on our investment performance. We have also entered into an Administration Agreement with the Administrator. Under our Administration Agreement, we have agreed to reimburse the Administrator for our allocable portion of overhead and other expenses incurred by the Administrator in performing its obligations under our Administration Agreement, including rent and our allocable portion of the costs of compensation and related expenses of our Chief Financial Officer, Chief Compliance Officer, and their respective staffs. Our board of directors, a majority of whom are independent of us, provides overall supervision of our activities, and the Investment Adviser manages our day-to-day activities.
Revenues
We generate revenue in the form of interest income on the debt securities we hold and capital gains and dividends, if any, on investment securities that we may acquire in portfolio companies. Our debt investments, whether in the form of first lien secured debt, second lien secured debt or subordinated debt, typically bear interest at a fixed or a floating rate. Interest on debt securities is generally payable quarterly or semiannually. In some cases, our investments provide for deferred interest payments and PIK interest. The principal amount of the debt securities and any accrued but unpaid interest generally becomes due at the maturity date. In addition, we generate revenue in the form of amendment, commitment, origination, structuring or diligence fees, fees for providing significant managerial assistance and possibly consulting fees. Loan origination fees, OID and market discount or premium and deferred financing costs on liabilities, which we do not fair value, are capitalized and accreted or amortized using the effective interest method as interest income or, in the case of deferred financing costs, as interest expense. Dividend income, if any, is recognized on an accrual basis on the ex-dividend date to the extent that we expect to collect such amounts. From time to time, the Company receives certain fees from portfolio companies, which may or may not be non-recurring in nature. Such fees include loan prepayment penalties, structuring fees, amendment fees, and agency fees and are recorded as other investment income when earned.
Expenses
Our primary operating expenses include interest expense on the outstanding debt and unused commitment fees on undrawn amounts, under our various debt facilities, the payment of a management fee and the payment of an incentive fee to our Investment Adviser, if any, our allocable portion of overhead under our Administration Agreement and other operating costs as detailed below. Our management fee compensates our Investment Adviser for its work in identifying, evaluating, negotiating, consummating and monitoring our investments. We bear all other direct or indirect costs and expenses of our operations and transactions, including:
Generally, during periods of asset growth, we expect our general and administrative expenses to be relatively stable or to decline as a percentage of total assets and increase during periods of asset declines. Incentive fees, interest expense and costs relating to future offerings of securities would be additive to the expenses described above.
PORTFOLIO AND INVESTMENT ACTIVITY
As of June 30, 2025, our portfolio totaled $1,171.6 million and consisted of $476.4 million or 41% of first lien secured debt, $124.7 million or 11% of U.S. Government Securities, $18.0 million or 1% of second lien secured debt, $194.2 million or 16% of subordinated debt (including $140.3 million or 12% in PSLF) and $358.3 million or 31% of preferred and common equity (including $73.3 million or 6% in PSLF). Our interest bearing debt portfolio consisted of 90% variable-rate investments and 10% fixed-rate investments. As of June 30, 2025, we had four portfolio companies on non-accrual, representing 2.8% and 0.7% percent of our overall portfolio on a cost and fair value basis, respectively. Overall, the portfolio had net unrealized appreciation of $40.4 million as of June 30, 2025. Our overall portfolio consisted of 158 companies with an average investment size of $6.6 million (excluding U.S. Government Securities), had a weighted average yield on interest bearing debt investments of 11.5%.
As of September 30, 2024, our portfolio totaled $1,328.1 million and consisted of $667.9 million or 50% of first lien secured debt, $99.6 million or 8% of U.S. Government Securities, $67.2 million or 5% of second lien secured debt, $181.7 million or 14% of subordinated debt (including $115.9 million or 9% in PSLF) and $311.7 million or 23% of preferred and common equity (including $67.9 million or 5% in PSLF). Our interest bearing debt portfolio consisted of 94% variable-rate investments and 6% fixed-rate investments. As of September 30, 2024, we had two portfolio companies on non-accrual, representing 4.1% and 2.3% of our overall portfolio on a cost and fair value basis, respectively. Overall, the portfolio had net unrealized appreciation of $11.2 million as of September 30, 2024. Our overall portfolio consisted of 152 companies with an average investment size of $8.1 million (excluding U.S. Government Securities), had a weighted average yield on interest bearing debt investments of 12.3%.
For the three months ended June 30, 2025, we invested $87.7 million in four new and 28 existing portfolio companies with a weighted average yield on debt investments of 10.0%. For the three months ended June 30, 2025, sales and repayments of investments totaled $132.2 million including $21.8 million sold to PSLF. For the nine months ended June 30, 2025, we invested $560.2 million in 19 new and 112 existing portfolio companies with a weighted average yield on debt investments of 10.5%. For the nine months ended June 30, 2025, sales and repayments of investments totaled $749.0 million including $462.8 million sold to PSLF. The investments sales and repayments noted above exclude all purchases and sales of U.S. Government Securities.
For the three months ended June 30, 2024, we invested $163.1 million in 11 new and 42 existing portfolio companies with a weighted average yield on debt investments of 12.0%. For the three months ended June 30, 2024, sales and repayments of investments totaled $132.9 million including $37.8 million sold to PSLF. For the nine months ended June 30, 2024, we invested $752.1 million in 29 new and 65 existing portfolio companies with a weighted average yield on debt investments of 11.9%. For the nine months ended June 30, 2024, sales and repayments of investments totaled $380.1 million including $191.8 million sold to PSLF. The investments sales and repayments noted above exclude all purchases and sales of U.S. Government Securities.
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As of June 30, 2025, PSLF’s portfolio totaled $1,339.1 million, consisted of 115 companies with an average investment size of $11.6 million and had a weighted average yield interest bearing debt investments of 10.4%.
As of September 30, 2024, PSLF’s portfolio totaled $1,031.2 million, consisted of 102 companies with an average investment size of $10.1 million and had a weighted average yield interest bearing debt investments of 11.3%.
For the three months ended June 30, 2025, PSLF invested $22.0 million, including $21.8 million purchased from the Company, in three new and one existing portfolio companies at weighted average yield interest bearing debt investments of 9.8%. PSLF’s sales and repayments of investments for the same period totaled $71.4 million. For the nine months ended June 30, 2025, PSLF invested $545.7 million, including $462.8 million purchased from the Company, in 26 new and 57 existing portfolio companies at weighted average yield interest bearing debt investments of 10.3%. PSLF’s sales and repayments of investments for the same period totaled $228.8 million.
For the three months ended June 30, 2024, PSLF invested $56.0. million, including $37.8 million purchased from the Company, in five new and seven existing portfolio companies at weighted average yield on interest bearing debt investments of 11.5%. PSLF’s sales and repayments of investments for the same period totaled $54.9 million. For the nine months ended June 30, 2024, PSLF invested $250.2 million, including $191.8 million purchased from the Company, in 21 new and 16 existing portfolio companies at weighted average yield on interest bearing debt investments of 12.0%. PSLF’s sales and repayments of investments for the same period totaled $133.8 million.
At-the-Market Offering
On June 4, 2024, we entered into Equity Distribution Agreements with Truist Securities, Inc. and Keefe, Bruyette & Woods, Inc. as the Sales Agents in connection with the sale of shares of our common stock, with an aggregate offering price of up to $100 million under an ATM Program. We may offer and sell shares of our common stock from time to time through a Sales Agent in amounts and at times to be determined by us. Actual sales will depend on a variety of factors to be determined by us from time to time, including, market conditions and the trading price of our common stock. The Investment Adviser may, from time to time, in its sole discretion, pay some or all of the commissions payable under the equity distribution agreements or make additional supplemental payments to ensure that the sales price per share of our common stock in connection with ATM Program offerings will not be made at price less than our current NAV per share. Any such payments made by the Investment Adviser will not be subject to reimbursement by us.
CRITICAL ACCOUNTING POLICIES AND ESTIMATES
The preparation of our Consolidated Financial Statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amount of our assets and liabilities at the date of the Consolidated Financial Statements and the reported amounts of income and expenses during the reported periods In the opinion of management, all adjustments, which are of a normal recurring nature, considered necessary for the fair presentation of financial statements have been included. Actual results could differ from these estimates due to changes in the economic and regulatory environment, financial markets and any other parameters used in determining such estimates and assumptions, including the credit worthiness of our portfolio companies. We may reclassify certain prior period amounts to conform to the current period presentation. We have eliminated all intercompany balances and transactions. References to ASC serve as a single source of accounting literature. Subsequent events are evaluated and disclosed as appropriate for events occurring through the date the Consolidated Financial Statements are issued. In addition to the discussion below, wedescribe our critical accounting policies in the notes to our Consolidated Financial Statements. We discuss our critical accounting estimates in Management’s Discussion and Analysis of Financial Condition and Results of Operations in our 2024 Annual Report on Form 10-K. There have been no significant changes in our critical accounting estimates from those disclosed in our 2024 Annual Report on Form 10-K during the three months ended June 30, 2025.
Investment Valuations
We expect that there may not be readily available market values for many of the investments which are or will be in our portfolio, and we value such investments at fair value as determined in good faith by or under the direction of our board of directors using a documented valuation policy and a consistently applied valuation process, as described in this Report. With respect to investments for which there is no readily available market value, the factors that our board of directors may take into account in pricing our investments at fair value include, as relevant, the nature and realizable value of any collateral, the portfolio company’s ability to make payments and its earnings and discounted cash flow, the markets in which the portfolio company does business, comparison to publicly traded securities and other relevant factors. When an external event such as a purchase transaction, public offering or subsequent equity sale occurs, we consider the pricing indicated by the external event to corroborate or revise our valuation. Due to the inherent uncertainty of determining the fair value of investments that do not have a readily available market value, the price used in an actual transaction may be different than our valuation and the difference may be material.
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A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Generally, most of our investments, and our are classified as Level 3. Our 2026 Notes and 2026 Notes-2 are classified as Level 2, as they are financial instruments with readily observable market inputs. Due to the inherent uncertainty of determining the fair value of investments that do not have a readily available market value, the price used in an actual transaction may be different than our valuation and those differences may be material.
On December 3, 2020, the SEC adopted Rule 2a-5 under the 1940 Act, which establishes an updated regulatory framework for determining fair value in good faith for purposes of the 1940 Act. The new rule clarifies how fund boards of directors can satisfy their valuation obligations and requires, among other things, the board of directors to periodically assess material valuation risks and take steps to manage those risks. The rule also permits boards of directors, subject to board oversight and certain other conditions, to designate the fund’s investment adviser to perform fair value determinations. The new rule went into effect on March 8, 2021 and had a compliance date of September 8, 2022. We came into compliance with Rule 2a-5 under the 1940 Act before the compliance date. While our board of directors has not elected to designate the Investment Adviser as the valuation designee at this time, we have adopted certain revisions to our valuation policies and procedures in order comply with the applicable requirements of Rule 2a-5 under the 1940 Act.
In addition to using the above inputs to value cash equivalents, investments, our 2026 Notes, 2026 Notes-2 and our Truist Credit Facility valuations, we employ the valuation policy approved by our board of directors that is consistent with ASC 820. Consistent with our valuation policy, we evaluate the source of inputs, including any markets in which our investments are trading, in determining fair value.
Generally, the carrying value of our consolidated financial liabilities approximates fair value. We have adopted the principles under ASC Subtopic 825-10, Financial Instruments ("ASC 825-10"), which provides companies with an option to report selected financial assets and liabilities at fair value, and made an irrevocable election to apply ASC 825-10 to the Truist Credit Facility. We elected to use the fair value option for the Truist Credit Facility to align the measurement attributes of both our assets and liabilities while mitigating volatility in earnings from using different measurement attributes. Due to that election and in accordance with GAAP, we incurred zero and $0.3 million of expenses relating to amendment costs on the Truist Credit Facility for both the three and nine months ended June 30, 2025, respectively. Due to that election and in accordance with GAAP, we did not incur any expenses relating to amendment costs on the Truist Credit Facility for both the three and nine months ended June 30, 2024. ASC 825-10 establishes presentation and disclosure requirements designed to facilitate comparisons between companies that choose different measurement attributes for similar types of assets and liabilities and to more easily understand the effect on earnings of a company’s choice to use fair value. ASC 825-10 also requires entities to display the fair value of the selected assets and liabilities on the face of the Consolidated Statements of Assets and Liabilities and changes in fair value of the Truist Credit Facility is reported in our Consolidated Statements of Operations. We elected not to apply ASC 825-10 to any other financial assets or liabilities, including the 2026 Notes, and 2026 Notes-2.
Revenue Recognition
We record interest income on an accrual basis to the extent that we expect to collect such amounts. For loans and debt investments with contractual PIK interest, which represents interest accrued and added to the loan balance that generally becomes due at maturity, we will generally not accrue PIK interest when the portfolio company valuation indicates that such PIK interest is not collectable. We do not accrue as a receivable interest on loans and debt investments if we have reason to doubt our ability to collect such interest. Loan origination fees, OID, market discount or premium and deferred financing costs on liabilities, which we do not fair value, are capitalized and then accreted or amortized using the effective interest method as interest income or, in the case of deferred financing costs, as interest expense. We record prepayment penalties on loans and debt investments as income. Dividend income, if any, is recognized on an accrual basis on the ex-dividend date to the extent that we expect to collect such amounts.
From time to time, the Company receives certain fees from portfolio companies, which may or may not be non-recurring in nature. Such fees include loan prepayment penalties, structuring fees, amendment fees, and agency fees and are recorded as other investment income when earned.
Net Realized Gains or Losses and Net Change in Unrealized Appreciation or Depreciation
We measure realized gains or losses by the difference between the net proceeds from the repayment or sale and the amortized cost basis of the investment, using the specific identification method, without regard to unrealized appreciation or depreciation previously recognized, but considering unamortized upfront fees and prepayment penalties. Net change in unrealized appreciation or depreciation reflects changes in the fair values of our portfolio investments and our Truist Credit Facility, including any reversal of previously recorded unrealized appreciation or depreciation, when gains or losses are realized.
Foreign Currency Translation
Payment-in-Kind, or PIK Interest
We have investments in our portfolio which contain a PIK interest provision. PIK interest is added to the principal balance of the investment and is recorded as income. In order for us to maintain our ability to be subject to tax as a RIC, substantially all of this income must be paid out to stockholders in the form of dividends for U.S. federal income tax purposes, even though we may not have collected any cash with respect to interest on PIK securities.
Federal Income Taxes
We have elected to be treated, and intend to qualify annually to maintain our election to be treated, as a RIC under Subchapter M of the Code. To maintain our RIC tax election, we must, among other requirements, meet certain annual source-of-income and quarterly asset diversification requirements. We also must annually distribute dividends for U.S. federal income tax purposes to our stockholders out of the assets legally available for distribution of an amount generally at least equal to 90% of the sum of our net ordinary income and realized net short-term capital gains in excess of realized net long-term capital losses, or investment company taxable income, determined without regard to any deduction for dividends paid.
Although not required for us to maintain our RIC tax status, in order to preclude the imposition of a 4% nondeductible U.S. federal excise tax imposed on RICs, we must distribute dividends for federal income tax purposes to our stockholders in respect of each calendar year of an amount at least equal to the sum of (1) 98% of our net ordinary income (subject to certain deferrals and elections) for the calendar year, (2) 98.2% of the excess, if any, of our capital gains over our capital losses, or capital gain net income (adjusted for certain ordinary losses) for the one-year period ending on October 31 of the calendar year plus (3) the sum of any net ordinary income plus capital gain net income for preceding years that was realized but not distributed during such years and on which we did not incur any U.S. federal income tax, or the Excise Tax Avoidance Requirement. In addition, although we may distribute realized net capital gains (i.e., net long-term capital gains in excess of net short-term capital losses), if any, at least annually, out of the assets legally available for such distributions in the manner described above, we have retained and may continue to retain such net capital gains or investment company taxable income, contingent on maintaining our ability to be subject to tax as a RIC, in order to provide us with additional liquidity.
Because federal income tax regulations differ from GAAP, distributions in accordance with tax regulations may differ from net investment income and net realized gain recognized for financial reporting purposes. Differences between tax regulations and GAAP may be permanent or temporary. Permanent differences are reclassified among capital accounts in the Consolidated Financial Statements to reflect their appropriate tax character. Temporary differences arise when certain items of income, expense, gain or loss are recognized at some time in the future.
For the three and nine months ended June 30, 2025, we recorded a provision for taxes on net investment income of $0.7 million and $1.9 million, respectively, pertaining to federal excise tax. For the three and nine months ended June 30, 2024, we recorded a provision for taxes on net investment income of $0.7 million and $1.9 million, respectively, all of which pertains to U.S. federal excise tax.
On November 22, 2021, we formed PNNT Investment Holdings II, LLC, a Delaware limited liability company (“Holdings II”), as a wholly owned subsidiary. On December 31, 2022, we contributed 100% of our interests in PNNT Investment Holdings, LLC (“Holdings”) to Holdings II . Effective as of January 1, 2024, Holdings II made an election to be treated as a corporation for U.S. federal income tax purposes. On January 3, 2024, we purchased an equity interest in Holdings from Holdings II and Holdings became a partnership for U.S. federal income tax purposes. The Company and Holdings II entered into a limited liability company agreement with respect to Holdings that provides for certain payments and the sharing of income, gain, loss and deductions attributable to Holdings’ investments.
For the three and nine months ended June 30, 2025, the Company recognized a provision for taxes of less than ($0.1) million and $(0.1) million on net realized gain (loss) on investments by the Taxable Subsidiary, respectively. For the three and nine months ended June 30, 2024, the Company recognized a provision for taxes of zero and $(0.2) million, respectively, on net realized gain (loss) on investments by the Taxable Subsidiary, respectively. For the three and nine months ended June 30, 2025, the Company recognized a provision for taxes zero and zero, on net unrealized gain (loss) on investments by the Taxable Subsidiary, respectively. For the three and nine months ended June 30, 2024, the Company recognized a provision for taxes of zero and $(0.7) million, on net unrealized gain (loss) on investments by the Taxable Subsidiary, respectively. The provision for taxes on net realized and unrealized gains on investments is the result of netting (i) the expected tax liability on the gains from the sales of investments which is likely to be realized and unrealized during fiscal year ending and (ii) the expected tax benefit resulting from the use of loss carryforwards to offset such gains.
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The Taxable Subsidiary, which is subject to tax as a corporation, allows us to hold equity securities of certain portfolio companies treated as pass-through entities for U.S. federal income tax purposes while facilitating our ability to qualify as a RIC under the Code.
RESULTS OF OPERATIONS
Set forth below are the results of operations for the three and nine months ended June 30, 2025 and 2024.
Investment Income
For the three and nine months ended June 30, 2025, investment income was $29.6 million and $94.4 million, respectively, which was attributable to $21.6 million and $68.9 million from first lien secured debt, $0.4 million and $3.4 million from second lien secured debt, $1.0 million and $3.2 million from subordinated debt and $6.5 million and $18.9 million from other investments, respectively. For the three and nine months ended June 30, 2024, investment income was $37.0 million and $107.3 million, respectively, which was attributable to $25.9 million and $78.5 million from first lien secured debt, $2.1 million and $7.6 million from second lien secured debt, $0.6 million and $1.9 million from subordinated debt and $8.4 million and $19.3 million from other investments, respectively. The decrease in investment income for three and nine months ended June 30, 2025, was primarily due to a decrease in our total portfolio size and a decrease in our weighted average yield on debt investments.
For the three and nine months ended June 30, 2025, expenses totaled $17.8 million and $58.2 million, respectively, and were comprised of $9.2 million and $31.6 million of debt related interest and expenses, $3.9 million and $12.2 million of base management fees, $2.5 million and $7.7 million of incentive fees, $1.5 million and $4.8 million of general and administrative expenses and $0.7 million and $1.9 million of provision for excise taxes, respectively. For the three and nine months ended June 30, 2024, expenses totaled $21.3 million and $61.7 million, respectively, and were comprised of; $11.5 million and $32.9 million of debt-related interest and expenses, $4.2 million and $12.4 million of base management fees, $3.3 million and $9.7 million of incentive fees, $1.5 million and $4.8 million of general and administrative expenses and $0.7 million and $1.9 million of provision for excise taxes, respectively. The decrease in expenses for the three and nine months ended June 30, 2025, was primarily due to decreases in interest and expenses on debt and a decrease in incentive fees.
Net Investment Income
For the three and nine months ended June 30, 2025, net investment income totaled $11.8 million and $36.2 million, or $0.18 per share and $0.55 per share, respectively. For the three and nine months ended June 30, 2024, net investment income totaled $15.7 million and $45.7 million, or $0.24 per share and $0.70 per share, respectively. The decrease in net investment income was primarily due to a decrease in investment income and partially offset by a decrease in expenses.
Net Realized Gains or Losses
For the three and nine months ended June 30, 2025, net realized gains (losses) totaled $(0.5) million and $(30.8) million, respectively. For the three and nine months ended June 30, 2024, net realized gains (losses) totaled $(6.9) million and $(36.1) million, respectively. The change in realized gains (losses) was primarily due to changes in the market conditions of our investments and the values at which they were realized.
Unrealized Appreciation or Depreciation on Investments and Debt
For the three and nine months ended June 30, 2025, we reported net change in unrealized appreciation (depreciation) on investments of $(0.2) million and $29.3 million, respectively. For the three and nine months ended June 30, 2024, we reported net change in unrealized appreciation (depreciation) on investments of $(5.1) million and $23.2 million, respectively. As of June 30, 2025 and September 30, 2024, our net unrealized appreciation (depreciation) on investments totaled $40.4 million and $11.2 million, respectively. The net change in unrealized depreciation on our investments was primarily due to changes in the capital market conditions of our investments and the values at which they were realized.
For the three and nine months ended June 30, 2025, the Truist Credit Facility had a net change in unrealized appreciation (depreciation) of $(2.9) million and $(1.0) million, respectively. For the three and nine months ended June 30, 2024, the Truist Credit Facility had a net change in unrealized appreciation (depreciation) of $(0.1) million and $(1.6) million, respectively. As of June 30, 2025 and September 30, 2024, the net unrealized appreciation (depreciation) on the Truist Credit Facility totaled $0.1 million and $1.1 million, respectively. The net change in unrealized appreciation (depreciation) compared to the same periods in the prior period was primarily due to changes in the capital markets.
Net Change in Net Assets Resulting from Operations
For the three and nine months ended June 30, 2025, net increase (decrease) in net assets resulting from operations totaled $8.2 million and $33.7 million or $0.12 per share and $0.52 per share, respectively. For the three and nine months ended June 30, 2024, net increase (decrease) in net assets resulting from operations totaled $3.7 million and $30.5 million or $0.06 per share and $0.47 per share, respectively. The change in net assets from operations for the nine months ended June 30, 2025 was primarily due to a change in the net realized and unrealized depreciation in the portfolio primarily driven by changes in market conditions and decrease in net investment income.
55
LIQUIDITY AND CAPITAL RESOURCES
Our liquidity and capital resources are derived primarily from cash flows from operations, including investment sales and repayments, income earned, proceeds of securities offerings and debt financings. Our primary use of funds from operations includes investments in portfolio companies and payments of interest expense, fees and other operating expenses we incur. We have used, and expect to continue to use, our debt capital, proceeds from the rotation of our portfolio and proceeds from public and private offerings of securities to finance our investment objectives and operations. As of June 30, 2025, in accordance with the 1940 Act, with certain limited exceptions, we are only allowed to borrow amounts such that we are in compliance with a 150% asset coverage ratio requirement after such borrowing. This “Liquidity and Capital Resources” section should be read in conjunction with the "Forward-Looking Statements" section above.
On February 5, 2019, our stockholders approved the application of the modified asset coverage requirements set forth in Section 61(a)(2) of the 1940 Act, as amended by the Consolidated Appropriations Act of 2018 (which includes the SBCAA) as approved by our board of directors on November 13, 2018. As a result, the asset coverage requirement applicable to us for senior securities was reduced from 200% (i.e., $1 of debt outstanding for each $1 of equity) to 150% (i.e., $2 of debt outstanding for each $1 of equity), subject to compliance with certain disclosure requirements.
As of June 30, 2025 and September 30, 2024, our asset coverage ratio, as computed in accordance with the 1940 Act was 176% and 164%, respectively.
For the nine months ended June 30, 2025 and 2024, the annualized weighted average cost of debt inclusive of the fee on the undrawn commitment and amendment costs on the Truist Credit Facility, and amortized upfront fees on, 2026 Notes and 2026 Notes-2, was 6.1% and 6.5%, respectively.
As of June 30, 2025, we had $150.0 million in aggregate principal amount of 2026 Notes outstanding. Interest on the 2026 Notes is paid semiannually on May 1 and November 1, at a rate of 4.50% per year, commencing November 1, 2021. The effective interest rate is 4.62% The 2026 Notes mature on May 1, 2026, and may be redeemed in whole or in part at our option subject to a make-whole premium if redeemed more than three months prior to maturity. The 2026 Notes are direct unsecured obligations and rank pari passu in right of payment with future unsecured unsubordinated indebtedness. The 2026 Notes are structurally subordinated to all existing and future indebtedness and other obligations of any of our subsidiaries, financing vehicles, or similar facilities.
As of June 30, 2025, we had $165.0 million in aggregate principal amount of 2026 Notes-2 outstanding. Interest on the 2026 Notes-2 is paid semiannually on May 1 and November 1, at a rate of 4.0% per year, commencing May 1, 2022. The effective interest rate is 4.12%. The 2026 Notes-2 mature on November 1, 2026, and may be redeemed in whole or in part at our option subject to a make-whole premium if redeemed more than three months prior to maturity. The 2026 Notes-2 are direct unsecured obligations and rank pari passu in right of payment with future unsecured unsubordinated indebtedness. The 2026 Notes-2 are structurally subordinated to all existing and future indebtedness and other obligations of any of our subsidiaries, financing vehicles, or similar facilities.
On June 4, 2024, we entered into the Equity Distribution Agreements in connection with the contemplated sale of shares of our common stock, with an aggregate offering price of up to $100 million under the ATM Program. We may offer and sell shares of our common stock from time to time through a Sales Agent in amounts and at times to be determined by us. Actual sales will depend on a variety of factors to be determined by us from time to time, including, market conditions and the trading price of our common stock. The Investment Adviser may, from time to time, in its sole discretion, pay some or all of the commissions payable under the Equity Distribution Agreements or make additional supplemental payments to ensure that the sales price per share of our common stock in connection with the ATM Program will not be less than our current NAV per share. Any such payments made by the Investment Adviser will not be subject to reimbursement by us.
We may raise additional equity or debt capital through both registered offerings off our shelf registration statement and private offerings of securities, or by securitizing a portion of our investments, among other sources. Any future additional debt capital we incur, to the extent it is available, may be issued at a higher cost and on less favorable terms and conditions than the Truist Credit Facility, 2026 Notes, and 2026 Notes-2. Furthermore, the Truist Credit Facility availability depends on various covenants and restrictions. The primary use of existing funds and any funds raised in the future is expected to be for repayment of indebtedness, investments in portfolio companies, cash distributions to our stockholders or for other general corporate or strategic purposes such as a stock repurchase program.
We have entered into certain contracts under which we have material future commitments. Under our Investment Management Agreement, which was reapproved by our board of directors (including a majority of our directors who are not interested persons of us or the Investment Adviser) in May 2025 PennantPark Investment Advisers serves as our investment adviser. Payments under our Investment Management Agreement in each reporting period are equal to (1) a management fee equal to a percentage of the value of our average adjusted gross assets and (2) an incentive fee based on our performance.
Under our Administration Agreement, which was most recently reapproved by our board of directors, including a majority of our directors who are not interested persons of us, in May 2025 the Administrator furnishes us with office facilities and administrative services necessary to conduct our day-to-day operations. If requested to provide significant managerial assistance to our portfolio companies, we or the Administrator will be paid an additional amount based on the services provided. Payment under our Administration Agreement is based upon our allocable portion of the Administrator’s overhead in performing its obligations under our Administration Agreement, including rent and our allocable portion of the costs of our Chief Compliance Officer, Chief Financial Officer, and their respective staffs.
56
If any of our contractual obligations discussed above are terminated, our costs under new agreements that we enter into may increase. In addition, we will likely incur significant time and expense in locating alternative parties to provide the services we expect to receive under our Investment Management Agreement and our Administration Agreement. Any new investment management agreement would also be subject to approval by our stockholders.
As of June 30, 2025 and September 30, 2024, we had cash and cash equivalents of $70.5 million and $49.9 million, respectively, available for investing and general corporate purposes. We believe our liquidity and capital resources are sufficient to allow us to effectively operate our business.
For the nine months ended June 30, 2025, our operating activities provided cash of $212.6 million and our financing activities used cash of $192.0 million. Our operating activities provided cash primarily due to our investment activities and our financing activities used cash primarily for repayments of our credit facility and distributions paid to stockholders.
For the nine months ended June 30, 2024, our operating activities used cash of $167.7 million and our financing activities provided cash of $188.1 million. Our operating activities used cash primarily due to our investment activities and our financing activities provided cash primarily from borrowings under the Truist Credit Facility.
58
Below is a listing of PSLF’s individual investments as of June 30, 2025 (par and $ in thousands):
60
62
Below are the consolidated statements of assets and liabilities for PSLF, ($ in thousands):
63
Below are the consolidated statements of operations for PSLF, ($ in thousands):
Distributions
In order to be treated as a RIC for federal income tax purposes and to not be subject to corporate-level tax on undistributed income or gains, we are required, under Subchapter M of the Code, to annually distribute dividends for U.S. federal income tax purposes to our stockholders out of the assets legally available for distribution of an amount generally at least equal to 90% of our investment company taxable income, determined without regard to any deduction for dividends paid.
Although not required for us to maintain our RIC tax status, in order to preclude the imposition of a 4% nondeductible federal excise tax imposed on RICs, we must distribute dividends for U.S. federal income tax purposes to our stockholders in respect of each calendar year of an amount at least equal to the Excise Tax Avoidance Requirement. In addition, although we may distribute realized net capital gains (i.e., net long-term capital gains in excess of net short-term capital losses), if any, at least annually, out of the assets legally available for such distributions in the manner described above, we have retained and may continue to retain such net capital gains or investment company taxable income, contingent on our ability to be subject to tax as a RIC, in order to provide us with additional liquidity.
During the three and nine months ended June 30, 2025, we declared distributions of $0.24 and $0.72 per share, for total distributions of $15.7 million and $47.0 million, respectively. During the three and nine months ended June 30, 2024, we declared distributions of $0.22 and $0.64 per share, for total distributions of $14.4 million and $41.8 million, respectively. We monitor available net investment income to determine if a return of capital for tax purposes may occur for the fiscal year. To the extent our taxable earnings fall below the total amount of our distributions for any given fiscal year, stockholders will be notified of the portion of those distributions deemed to be a tax return of capital. Tax characteristics of all distributions will be reported to stockholders subject to information reporting on Form 1099-DIV after the end of each calendar year and in our periodic reports filed with the SEC.
Effective October 2023, we changed from a quarterly distribution to a monthly distribution. We intend to continue to make monthly distributions to our stockholders. Our monthly distributions, if any, are determined by our board of directors.
We maintain an “opt out” dividend reinvestment plan for our common stockholders. As a result, if we declare a distribution, then stockholders’ cash distributions will be automatically reinvested in additional shares of our common stock, unless they specifically “opt out” of the dividend reinvestment plan so as to receive cash distributions.
We may not be able to achieve operating results that will allow us to make distributions at a specific level or to increase the amount of these distributions from time to time. In addition, we may be limited in our ability to make distributions due to the asset coverage ratio for borrowings applicable to us as a BDC under the 1940 Act and/or due to provisions in future credit facilities. If we do not distribute at least a certain percentage of our income annually, we could suffer adverse tax consequences, including possible loss of our ability to be subject to tax as a RIC. We cannot assure stockholders that they will receive any distributions at a particular level.
Recent Accounting Pronouncements
64
We are subject to financial market risks, including changes in interest rates. As of June 30, 2025, our debt portfolio consisted of 90% variable-rate investments and 10% fixed rate investments. The variable-rate loans are usually based on a SOFR (or an alternative risk-free floating interest rate index) rate and typically have durations of three months after which they reset to current market interest rates. Variable-rate investments subject to a floor generally reset by reference to the current market index after one to nine months only if the index exceeds the floor. In regards to variable-rate instruments with a floor, we do not benefit from increases in interest rates until such rates exceed the floor and thereafter benefit from market rates above any such floor. In contrast, our cost of funds, to the extent it is not fixed, will fluctuate with changes in interest rates since it has no floor.
Assuming that the most recent Consolidated Statements of Assets and Liabilities was to remain constant, and no actions were taken to alter the interest rate sensitivity, the following table shows the annualized impact of hypothetical base rate changes in interest rates:
Change in Interest Rates
Change in Interest Income, Net of Interest Expense (in thousands)
Change in Interest Income, Net of Interest Expense Per Share
Down 1%
(3,044
(0.05
Up 1%
3,044
0.05
Up 2%
6,088
0.09
Up 3%
9,132
0.14
Up 4%
12,189
0.19
Although management believes that this measure is indicative of our sensitivity to interest rate changes, it does not adjust for potential changes in the credit market, credit quality, size and composition of the assets on the Consolidated Statements of Assets and Liabilities and other business developments that could affect net increase in net assets resulting from operations, or net investment income. Accordingly, no assurances can be given that actual results would not differ materially from those shown above.
Because we borrow money to make investments, our net investment income is dependent upon the difference between the rate at which we borrow funds and the rate at which we invest these funds as well as our level of leverage. As a result, there can be no assurance that a significant change in market interest rates will not have a material adverse effect on our net investment income or net assets.
We may hedge against interest rate and foreign currency fluctuations by using standard hedging instruments such as futures, options and forward contracts or our Truist Credit Facility subject to the requirements of the 1940 Act and applicable commodities laws. While hedging activities may insulate us against adverse changes in interest rates and foreign currencies, they may also limit our ability to participate in the benefits of lower interest rates or higher exchange rates with respect to our portfolio of investments with fixed interest rates or investments denominated in foreign currencies. During the periods covered by this Report, we did not engage in interest rate hedging activities or foreign currency derivatives hedging activities.
As of the period covered by this Report, we, including our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act). Based on that evaluation, our management, including the Chief Executive Officer and Chief Financial Officer, concluded that our disclosure controls and procedures were effective and provided reasonable assurance that information required to be disclosed in our periodic filings with the SEC is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. However, in evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated can provide only reasonable assurance of achieving the desired control objectives, and management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of such possible controls and procedures.
There have been no changes in our internal control over financial reporting that occurred during the quarter ended June 30, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
PART II – OTHER INFORMATION
None of us, our Investment Adviser or our Administrator, is currently subject to any material legal proceedings, nor, to our knowledge, is any material legal proceeding threatened against us, or against our Investment Adviser or Administrator. From time to time, we, our Investment Adviser or Administrator may be a party to certain legal proceedings, including proceedings relating to the enforcement of our rights under contracts with our portfolio companies. While the outcome of these legal proceedings cannot be predicted with certainty, we do not expect that these proceedings will have a material effect upon our financial condition or results of operations.
In addition to the other information set forth in this Report, you should consider carefully the factors discussed below, as well as in Part I “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended September 30, 2024, filed on November 26, 2024, which could materially affect our business, financial condition and/or operating results. The risks as in our Annual Report on Form 10-K, and this Quarterly Report on Form 10-Q, are not the only risks facing PennantPark Investment Corp. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially and adversely affect our business, financial condition and/or operating results.
Changes to U.S. tariff and import/export regulations may have a negative effect on our portfolio companies.
There have been significant changes to U.S. trade policies, treaties and tariffs, and in the future there may be additional significant changes. Existing or new tariffs imposed on foreign goods imported by the U.S. or on U.S. goods imported by foreign countries could subject us or our portfolio companies to additional risks. Among other effects, tariffs may increase the cost of production for certain of our portfolio companies or reduce demand for their products, which could adversely affect their results of operations. We cannot predict whether, or to what extent, any tariff or other trade protections may affect our portfolio companies or our business, financial condition or results of operations.
We are subject to risks associated with cybersecurity and cyber incidents.
Our internal computer systems and infrastructure and those of our Investment Adviser, strategic collaborators, vendors, contractors, consultants or regulators with whom we share confidential, protected or sensitive data or information, or upon which our business relies, are vulnerable to damage from computer viruses, unauthorized access, misuse, natural disasters, terrorism, cybersecurity threats, war and telecommunication and electrical failures, as well as security compromises or breaches, which may compromise our systems, infrastructure, data or that of those with whom we share such data or information or upon which our business relies, or lead to data compromise, misuse, misappropriation or leakage. We may experience, and from time to time have experienced, cyber attacks on our information technology systems and infrastructure by threat actors of all types (including nation states, criminal enterprises, individual actors or advanced persistent threat groups, among others). In addition to extracting sensitive information, such attacks could include the deployment of harmful malware, ransomware, digital extortion, business email compromises and denial-of-service attacks, social engineering (including phishing attacks) and other means to affect server reliability and threaten the confidentiality, integrity and availability of information, systems or infrastructure.
As our reliance on technology has increased, so have the risks posed to our information systems, both internal and those provided by our Investment Adviser and other third-parties. We, along with our Investment Adviser, have implemented processes, procedures and internal controls to help mitigate cybersecurity risks and cyber-attacks, but these measures, as well as our increased awareness of the nature and extent of the risk of a cyber attack, may be ineffective and do not guarantee that a cyber attack will not occur or that our financial results, operations or confidential information will not be negatively impacted by such an attack. Further, our contracts may not contain limitations of liability, and even where they do, there can be no assurance that limitations of liability in our contracts are sufficient to protect us from liabilities, damages or claims related to our privacy and data security obligations. Further, although we maintain cyber liability insurance, this insurance may not provide adequate coverage against potential liabilities related to any experienced cybersecurity attack or breach.
Furthermore, cybersecurity continues to be a priority for regulators around the world, and some jurisdictions have enacted laws requiring companies to notify individuals and/or regulators of data security breaches involving certain types of personal information. If we fail to comply with the relevant laws and regulations, we could suffer financial losses, a disruption of our businesses, liability to investors, regulatory intervention or reputational damage.
None.
Not applicable.
10b5-1 Disclosure
None of the officers or directors of the Company has adopted or terminated any Rule 10b5-1 trading arrangements applicable to them (if any) or the Company.
Unless specifically indicated otherwise, the following exhibits are incorporated by reference to exhibits previously filed with the SEC:
3.1
Articles of Incorporation (Incorporated by reference to Exhibit 99(a) to the Registrant’s Pre-Effective Amendment No. 3 to the Registration Statement on Form N-2/A (File No. 333-140092), filed on April 5, 2007).
3.2
Articles of Amendment to Articles of Incorporation of the Registrant (Incorporated by reference to Exhibit 3.2 to the Registrant’s Quarterly Report on Form 10-Q (File No. 814-00736), filed on August 7, 2024).
3.3
Second Amended and Restated Bylaws of the Registrant (Incorporated by reference to Exhibit 3.2 to the Registrant's Quarterly Report on Form 10-Q (File No. 814-00736), filed on May 11, 2020).
31.1*
Certification of Chief Executive Officer pursuant to Rule 13a-14 of the Securities Exchange Act of 1934, as amended.
31.2*
Certification of Chief Financial Officer pursuant to Rule 13a-14 of the Securities Exchange Act of 1934, as amended.
32.1*
Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2*
Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
99.1
Privacy Policy of the Registrant (Incorporated by reference to Exhibit 99.1 to the Registrant’s Annual Report on Form 10-K (File No. 814-00736), filed on November 16, 2011).
101.INS*
Inline XBRL Instance Document-the instance document does not appear in the Interactive Data File as its XBRL tags are embedded within the Inline XBRL document
101.SCH*
Inline XBRL Taxonomy Extension Schema With Embedded Linkbase Documents
101.CAL*
Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF*
Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB*
Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE*
Inline XBRL Taxonomy Extension Presentation Linkbase Document
Cover Page formatted as Inline XBRL and contained in Exhibit 101
* Filed herewith.
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this Report on Form 10-Q to be signed on its behalf by the undersigned, thereunto duly authorized.
Date: August 11, 2025
By:
/s/ Arthur H. Penn
Arthur H. Penn
Chief Executive Officer and Chairman of the Board of Directors
(Principal Executive Officer)
/s/ Richard T. Allorto, Jr.
Richard T. Allorto, Jr.
Chief Financial Officer and Treasurer
(Principal Financial and Accounting Officer)