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, 2026
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 814-00861
Fidus Investment Corporation
(Exact Name of Registrant as Specified in its Charter)
Maryland
27-5017321
(State or Other Jurisdiction of
Incorporation or Organization)
(I.R.S. Employer
Identification No.)
1603 Orrington Avenue, Suite 1005
Evanston, Illinois
60201
(Address of Principal Executive Offices)
(Zip Code)
(847) 859-3940
(Registrant’s telephone number, including area code)
n/a
(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
FDUS
The NASDAQ Global Select Market
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. (Check one):
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 ☑
As of August 4, 2026, the Registrant had outstanding 37,954,364 shares of common stock, $0.001 par value.
1
FIDUS INVESTMENT CORPORATION
TABLE OF CONTENTS
QUARTERLY REPORT ON FORM 10-Q
PART I — FINANCIAL INFORMATION
Item 1.
Financial Statements.
Consolidated Statements of Assets and Liabilities — June 30, 2026 (unaudited) and December 31, 2025
3
Consolidated Statements of Operations — three and six months ended June 30, 2026 (unaudited) and 2025 (unaudited)
4
Consolidated Statements of Changes in Net Assets — three and six months ended June 30, 2026 (unaudited) and 2025 (unaudited)
5
Consolidated Statements of Cash Flows — six months ended June 30, 2026 (unaudited) and 2025 (unaudited)
6
Consolidated Schedules of Investments — June 30, 2026 (unaudited) and December 31, 2025
7
Notes to Consolidated Financial Statements (unaudited)
24
Item 2.
Management’s Discussion and Analysis of Financial Condition and Results of Operations.
49
Item 3.
Quantitative and Qualitative Disclosures About Market Risk.
67
Item 4.
Controls and Procedures
68
PART II — OTHER INFORMATION
Legal Proceedings.
Item 1A.
Risk Factors.
Unregistered Sales of Equity Securities and Use of Proceeds.
Defaults Upon Senior Securities.
69
Mine Safety Disclosures.
Item 5.
Other Information.
Item 6.
Exhibits.
70
Signatures
71
2
Item 1. Financial Statements.
Consolidated Statements of Assets and Liabilities
(in thousands, except shares and per share data)
June 30,
2026
December 31,
(unaudited)
2025
ASSETS
Investments, at fair value:
Control investments (cost: $1,610 and $1,610, respectively)
$
—
Affiliate investments (cost: $77,086 and $75,208, respectively)
125,329
119,015
Non-control/non-affiliate investments (cost: $1,325,735 and $1,222,476, respectively)
1,307,582
1,205,738
Total investments, at fair value (cost: $1,404,431 and $1,299,294, respectively)
1,432,911
1,324,753
Cash and cash equivalents
37,599
69,995
Restricted cash
1,678
9,611
Interest receivable
27,716
21,414
Prepaid expenses and other assets
1,217
766
Total assets
1,501,121
1,426,539
LIABILITIES
SBA debentures (net of $7,930 and $6,943, respectively, of unamortized deferred financing costs)
288,070
230,557
Notes (net of $5,567 and $4,109, respectively, of unamortized deferred financing costs)
314,433
320,891
SPV Credit Facility (net of $2,895 and $3,223, respectively, of unamortized deferred financing costs)
109,755
80,627
Secured borrowings
11,149
12,000
Accrued interest and fees payable
8,859
7,449
Base management fee payable, net of base management fee waiver – due to affiliate
6,180
5,596
Income incentive fee payable – due to affiliate
4,647
4,721
Capital gains incentive fee payable – due to affiliate
15,716
16,414
Administration fee payable and other – due to affiliate
521
988
Taxes payable
955
3,568
Accounts payable and other liabilities
2,358
1,829
Total liabilities
762,643
684,640
Commitments and contingencies (Note 7)
NET ASSETS
Common stock, $0.001 par value (100,000,000 shares authorized, 37,954,364 and 37,954,364 shares issued and
outstanding at June 30, 2026 and December 31, 2025, respectively)
38
Additional paid-in capital
641,376
Total distributable earnings
97,064
100,485
Total net assets
738,478
741,899
Total liabilities and net assets
Net asset value per common share
19.46
19.55
See Notes to Consolidated Financial Statements (unaudited).
Consolidated Statements of Operations (unaudited)
Three Months Ended
Six Months Ended
Investment Income:
Interest income
Control investments
Affiliate investments
1,609
1,074
3,150
2,168
Non-control/non-affiliate investments
34,893
31,137
67,640
60,362
Total interest income
36,502
32,211
70,790
62,530
Payment-in-kind interest income
3,482
2,451
6,551
4,699
Total payment-in-kind interest income
Dividend income
557
166
1,052
305
465
588
810
Total dividend income
862
631
1,145
1,862
Fee income
10
8
16
2,086
3,876
11,015
5,995
Total fee income
2,096
3,884
11,039
6,011
Interest on idle funds
560
793
1,501
1,364
Total investment income
43,502
39,970
91,026
76,466
Expenses:
Interest and financing expenses
10,957
7,769
20,732
14,542
Base management fee
6,230
5,106
12,143
10,028
Incentive fee - income
4,854
10,481
9,448
Incentive fee (reversal) - capital gains
254
1,331
(698
)
1,618
Administrative service expenses
778
754
1,549
1,356
Professional fees
1,672
1,298
2,977
2,246
Other general and administrative expenses
269
221
534
427
Total expenses before base management fee waiver
24,807
21,333
47,718
39,665
Base management fee waiver
(50
(59
(101
(118
Total expenses, net of base management fee waiver
24,757
21,274
47,617
39,547
Net investment income before income taxes
18,745
18,696
43,409
36,919
Income tax provision (benefit)
53
76
Net investment income
18,692
18,628
43,333
36,850
Net realized and unrealized gains (losses) on investments:
Net realized gains (losses):
(120
1,189
10,066
5,236
(7,568
(6,849
(4,304
Total net realized gain (loss) on investments
6,425
(5,780
5,762
Income tax (provision) benefit from realized gains on investments
(318
(79
(416
(1,929
Net change in unrealized appreciation (depreciation):
2,474
3,498
4,436
(3,392
(7,116
10,880
(1,415
7,977
Total net change in unrealized appreciation (depreciation) on investments
(4,642
14,378
3,021
4,585
Net gain (loss) on investments
1,465
6,731
(3,175
8,418
Realized losses on extinguishment of debt
(194
(75
(311
(326
Net increase (decrease) in net assets resulting from operations
19,963
25,284
39,847
44,942
Per common share data:
Net investment income per share-basic and diluted
0.49
0.53
1.14
1.06
Net increase in net assets resulting from operations per share — basic and diluted
0.72
1.05
1.30
Dividends declared per share
0.62
0.54
1.08
Weighted average number of shares outstanding — basic and diluted
37,954,364
35,156,663
34,620,172
Consolidated Statements of Changes in Net Assets (unaudited)
(in thousands, except shares)
Common Stock
Additional
Total
Number of
Par
paid-in
distributable
Total net
shares
value
capital
earnings
assets
Balances at December 31, 2024
33,914,652
34
567,159
88,473
655,666
Public offering of common stock, net of expenses
1,019,812
20,660
20,661
Shares issued under dividend reinvestment plan
36,245
*
700
18,222
Net realized gain (loss) on investments, net of taxes
11,480
Net unrealized appreciation (depreciation) on investments
(9,793
(251
Dividends declared
(18,755
Balances at March 31, 2025
34,970,709
35
588,519
89,376
677,930
376,625
7,540
32,566
(7,647
(19,088
Balances at June 30, 2025
35,379,900
596,690
95,572
692,297
Balances at December 31, 2025
24,641
(12,303
7,663
(117
(19,736
Balances at March 31, 2026
100,633
742,047
6,107
(23,532
Balances at June 30, 2026
*amount is greater than zero but less than one
Consolidated Statements of Cash Flows (unaudited)
(in thousands)
Six Months Ended June 30,
Cash Flows from Operating Activities:
Adjustments to reconcile net increase (decrease) in net assets resulting from operations to net cash provided by (used for) operating activities:
Net change in unrealized (appreciation) depreciation on investments
(3,021
(4,585
Net realized (gain) loss on investments
5,780
(5,762
Interest and dividend income paid-in-kind
(6,551
(4,699
Accretion of original issue discount
(31
(86
Accretion of loan origination fees
(1,326
(1,598
Purchase of investments
(216,662
(210,006
Proceeds from sales and repayments of investments
112,228
166,605
Proceeds from loan origination fees
1,425
1,333
311
326
Amortization of deferred financing costs
1,599
1,314
Amortization of deferred equity financing costs
Changes in operating assets and liabilities:
(6,302
(747
(417
126
1,410
1,695
584
243
(74
377
Capital gains incentive fee (reversal) – due to (from) affiliate
Administration fee payable and other – due to (from) affiliate
(467
(301
(2,613
(1,525
462
405
Net cash provided by (used for) operating activities
(74,516
(10,258
Cash Flows from Financing Activities:
Proceeds from common stock offerings, net of expenses
28,201
Proceeds received from SBA debentures
65,500
39,500
Repayments of SBA debentures
(7,000
(12,500
Proceeds received from issuance of Notes
120,000
100,000
Principal payments on Notes
(125,000
(25,000
Proceeds received from (repayments of) Credit Facilities, net
28,800
(45,000
Proceeds received from (repayments of) Secured Borrowings, net
(851
(419
Payment of deferred financing costs
(3,994
(3,964
Dividends paid to stockholders, including expenses
(43,268
(36,512
Net cash provided by (used for) financing activities
34,187
44,306
Net increase (decrease) in cash, cash equivalents and restricted cash
(40,329
34,048
Cash, cash equivalents and restricted cash:
Beginning of period
79,606
57,159
End of period
39,277
91,207
Supplemental cash flow disclosures:
Cash payments for interest
17,723
11,533
Cash payments for taxes, net of tax refunds received
3,105
3,523
Non-cash financing activities:
Value of shares issued pursuant to the dividend reinvestment plan
The following table provides a reconciliation of cash and cash equivalents and restricted cash reported within the Consolidated Statements of Assets and Liabilities that sum to the total of the same such amounts in the Consolidated Statements of Cash Flows:
As of
June 30, 2026
December 31, 2025
Total cash, cash equivalents and restricted cash presented in the Consolidated Statements of Cash Flows
Consolidated Schedule of Investments (unaudited)
Portfolio Company (a)(b)
Variable Index
Rate (e)
Investment
Principal
Fair
Percent of
Investment Type (c)
Industry
Spread / Floor (d)
Cash/PIK
Date (f)
Maturity
Amount
Cost
Value (g)
Net Assets
Control Investments (t)
US GreenFiber, LLC (n)
Building Products Manufacturing
Common Equity (2,522 units) (h)
7/3/2014
586
Common Equity (425,508 units)
8/30/2019
Common Equity (1,022,813 units) (h)
7/1/2020
1,023
1,610
0
%
Total Control Investments
Affiliate Investments (l)
Applegate Greenfiber Intermediate Inc. (fka US GreenFiber, LLC)
Subordinated Debt
11.00%/0.00%
12/31/2021
12/31/2027
9,602
8,510
Common Equity (5,690 units) (h)
5,690
7,563
Common Equity (7,113 units) (h)
7,113
10,100
Common Equity (2,012 units) (h)
22,405
26,173
CP Communications, LLC
Business Services
First Lien Debt (am)
(S + 8.50%) / (4.00%)
12.50%/0.00%
12/4/2024
12/4/2029
5,703
5,670
Preferred Equity (62 units)
500
651
6,170
6,354
Medsurant Holdings, LLC (n)
Healthcare Services
Preferred Equity (84,997 units) (h)
4/12/2011
Warrant (252,588 units) (h)(m)
Pfanstiehl, Inc.
Healthcare Products
Common Equity (2,550 units)
3/29/2013
255
41,717
PIPCO, LLC
Utilities: Services
First Lien Debt (bn)
(S + 6.25%) / (2.00%)
9.94%/0.00%
12/11/2025
12/11/2030
8,978
8,932
Common Equity (750 units)
750
1,122
9,682
Spectra A&D Acquisition, Inc. (fka FDS Avionics Corp.)
Aerospace & Defense Manufacturing
First Lien Debt (ag)
(S + 6.00%) / (1.00%)
9.99%/0.00%
2/12/2021
8/11/2027
28,435
28,392
Common Equity (12,035 units)
8/25/2021
1,204
Common Equity (38,493 units)
12/16/2022
2,609
Common Equity (6,783 units)
7/10/2023
686
1,053
Common Equity (4,663 units)
9/16/2022
472
151
Common Equity (21,689 units)
5/22/2024
2,195
3,363
35,558
33,002
Steward Holding LLC (dba Steward Advanced Materials)
Common Equity (1,000,000 units)
11/12/2015
1,000
6,083
Suited Connector LLC
Information Technology Services
Preferred Equity (12,000,000 units) (h)
3/31/2026
2,016
1,900
Common Equity (15,000,000 units) (h)
Total Affiliate Investments
77,086
17
Non-control/Non-affiliate Investments
2KDirect, Inc. (dba iPromote)
First Lien Debt (at)
(S + 8.00%) / (0.50%)
11.83%/0.00%
6/25/2021
9/30/2027
6,548
6,542
6,082
First Lien Debt (aa)
8.08%/0.00%
7/30/2021
1,696
1,679
9,238
7,761
301 Edison Holdings Inc. (dba LGG Industrial)
Specialty Distribution
First Lien Debt (j)
11.75%/2.25%
11/14/2023
11/13/2028
11,886
11,809
11,623
Preferred Equity (518,135 units)
12,809
12,623
Acendre Midco, Inc.
First Lien Debt
12.50%/1.25%
10/6/2021
5/8/2026
5,781
13,138
Revolving Loan (i)
1,016
Common Equity (500,000 shares)
371
Warrant (275,000 shares) (m)
253
Preferred Equity (77,016 shares)
9/26/2022
88
29
Preferred Equity (568,182 shares)
6/10/2025
375
21,022
20,964
Ad Info Parent, Inc. (dba MediaRadar)
(S + 4.75%) / (1.00%)
8.48%/0.00%
11/1/2023
9/16/2029
15,836
15,776
Revolving Loan ($1,442 unfunded commitment) (i)
(4
Preferred Equity (1,250,000 units)
1,250
1,370
17,022
17,206
Air Burners, Inc.
Utility Equipment Manufacturing
First Lien Debt (j)(ah)
(S + 5.00%) / (2.00%)
8.69%/0.00%
12/8/2025
11/24/2030
6,400
6,333
Common Equity (817 units) ($200 unfunded commitment)
11/24/2025
800
804
7,133
7,204
Allredi, LLC (fka Marco Group International OpCo, LLC)
Industrial Cleaning & Coatings
Second Lien Debt
0.00%/15.00%
3/2/2020
20,053
18,853
18,701
Common Equity (570,636 units) (h)
7/21/2017
637
Common Equity (39,443 units) (h)
11/24/2021
22
Common Equity (524,624units) (h)
8/3/2023
45
19,557
American AllWaste LLC (dba WasteWater Transport Services)
Environmental Industries
10.00%/2.00%
3/27/2026
6/30/2027
48,759
48,663
Preferred Equity (500 units) (h)
5/31/2018
Preferred Equity (207 units) (h)
8/6/2019
250
Preferred Equity (141 units) (h)
11/2/2020
171
Preferred Equity (74 units) (h)
12/29/2021
97
Preferred Equity (52 units) (h)
11/27/2024
52
Preferred Equity (312 units) (h)
12/30/2024
312
Common Equity (1,405 units) (h)
50,045
AmeriWater, LLC
Component Manufacturing
First Lien Debt (af)
(S + 6.25%) / (1.00%)
9.98%/0.00%
7/8/2022
7/8/2027
6,656
6,646
Common Equity (1,000 units) (h)
2,200
7,646
8,856
AMOpportunities, Inc.
13.50%/0.50%
3/12/2025
3/12/2029
11,491
11,445
Preferred Equity (830,752 shares)
3/17/2025
831
829
Preferred Equity (70,413 shares)
5/4/2026
12,346
12,391
Acorn VMS Holdco, LP (dba Oakline Holdings)
(S + 6.75%) / (2.00%)
10.39%/0.00%
5/22/2026
5/22/2031
11,200
11,155
Revolving Loan ($400 unfunded commitment) (i)
AOM Intermediate Holdco, LLC (dba AllOver Media)
Common Equity (1,232 units) (h)
2/1/2022
1,372
1,720
APM Intermediate Holdings, LLC (dba Artistic Paver Manufacturing, Inc.)
First Lien Debt (ai)
(S + 7.00%) / (2.00%)
10.69%/0.00%
11/8/2022
11/8/2027
18,078
18,053
10.00%/5.00%
12/19/2025
2/8/2028
2,568
2,557
2,376
Common Equity (1,200 units) (h)
1,200
1,065
21,810
21,519
Auto CRM LLC (dba Dealer Holdings)
0.00%/14.50%
10/1/2021
12/31/2028
975
974
2,143
2,142
Common Equity (253 units)
3,369
3,118
Axis Medical Technologies LLC (dba MoveMedical)
(S + 6.50%) / (2.00%)
10.19%/0.00%
10/24/2024
10/24/2029
13,600
13,555
Revolving Loan ($800 unfunded commitment) (x)
(3
Preferred Equity (1,200,000 units)
10/25/2024
1,148
1,307
14,700
14,907
Bad Boy Mowers JV Acquisition, LLC
Consumer Products
(S + 5.25%) / (0.75%)
8.95%/0.00%
12/12/2025
11/9/2029
9,929
9,887
Preferred Equity (13,000 units)
11/9/2023
1,300
2,668
11,187
12,597
Barefoot Mosquito and Pest Control, LLC
Consumer Services
First Lien Debt (k)(s)
(S + 4.00%) / (2.00%)
7.69%/2.00%
12/22/2029
33,043
33,023
29,078
First Lien Debt (ba)
6.94%/0.00%
7/14/2025
Common Equity (6,027 units) (h)
12/22/2023
12
Preferred Equity (20,137 units) (h)
2,014
Preferred Equity (1,370 units) (h)
2/18/2026
137
640
35,191
29,723
BCM One Group Holdings, Inc.
11.75%/0.00%
11/17/2021
11/17/2028
17,667
17,602
17,668
Bedford Precision Parts LLC
Common Equity (500,000 units) (h)
3/12/2019
478
313
BPCP Dcom, Inc.
First Lien Debt ($9,750 unfunded commitment)
(S + 4.75%) / (2.00%)
0.00%/0.00%
6/17/2026
6/17/2032
Bobcat of Connecticut, LLC
First Lien Debt (bk)
(S + 5.75%) / (2.00%)
9.44%/0.00%
10/1/2025
10/1/2030
22,500
22,365
Common Equity (1,065,791 LP Units) ($184 unfunded commitment)
1,066
1,153
23,431
23,653
Brightmore Brands LLC
Retail
First Lien Debt (j)(al)
(S + 5.38%) / (1.50%)
9.11%/0.00%
9/13/2022
9/9/2029
23,529
23,307
Common Equity (1,000 units)
1,560
Common Equity (371 units)
9/9/2024
713
714
25,020
25,803
Cardback Intermediate, LLC (dba Chargeback Gurus)
First Lien Debt (j)(bl)
8.93%/0.00%
12/16/2025
12/16/2030
14,126
14,042
Common Equity (495 shares)
8/10/2021
335
Preferred Equity (495 shares)
203
14,132
14,664
Choice Technology Solutions, LLC (dba Choice Merchant Solutions, LLC) (n)
Preferred Equity (500,000 units) (h)
8/21/2023
CIH Intermediate, LLC (n)
Common Equity (563 shares)
3/3/2022
Preferred Equity (563 shares)
Cleanova Topco Limited
Preferred Equity (746,893shares)
6/12/2025
841
910
Preferred Equity (373,447shares)
436
Common Equity (113,166 shares)
454
645
1,731
2,027
CRS Solutions Holdings, LLC (dba CRS Texas)
Common Equity (574,929 units) (h)
6/28/2022
272
CTM Group, Inc. (dba Venuplus, Inc.)
(S + 6.75%) / (1.00%)
10.49%/0.75%
2/28/2023
11/30/2026
8,717
8,693
8,713
1/28/2026
124
123
7.75%/6.50%
11/30/2027
2,654
2,644
2,506
Common Equity (400,000 units)
400
11,860
11,343
Customer Expressions Corp (dba Case IQ) (aq)
First Lien Debt (bc)(ao)
(S + 5.00%) / (1.00%)
8.88%/0.50%
1/6/2025
4/15/2029
15,283
15,209
Common Equity (502,894 units) (ao)
771
15,980
16,114
Dataguise, Inc.
Common Equity (909 shares)
12/31/2020
1,500
1,384
Dealerbuilt Acquisition, LLC
First Lien Debt (k)
11.00%/2.00%
5/29/2026
4/30/2029
25,046
24,864
Common Equity (1,038 Units) (h)
7/21/2023
Preferred Equity (1,038 Units) (h)
1,038
925
25,902
25,789
Detechtion Holdings, LLC
(S + 6.25%) / (2.25%)
9.94%/2.00%
6/21/2023
6/21/2028
28,037
27,971
Revolving Loan ($1,000 unfunded commitment) (w)
(S + 8.25%) / (2.25%)
11.94%/0.00%
7/12/2024
0.00%/14.00%
3,052
3,046
Common Equity (601,532 units) (h)
602
247
31,616
31,336
Diversified Search LLC
First Lien Debt (j)(r)
(S + 7.50%) / (1.00%)
11.49%/0.00%
6/10/2019
12/23/2026
24,155
24,150
24,047
Common Equity (573 units) (h)
2/7/2019
552
158
24,702
24,205
Donovan Food Brokerage, LLC
First Lien Debt (ae)
(S + 6.00%) / (2.00%)
9.70%/0.00%
2/23/2024
2/23/2029
24,209
24,128
Common Equity (706,822 units)
772
1,622
24,900
25,831
E-PlanSoft Buyer, LLC (dba e-PlanSoft)
9
6/30/2025
6/30/2030
8,164
8,130
Preferred Equity (1,500 units)
6/27/2025
1,064
9,630
9,228
Enterprise Asset Management FM Purchaser, Inc. (dba MCIM)
First Lien Debt ($1,500 unfunded commitment)
9.44%/2.00%
5/20/2024
5/20/2029
20,267
20,204
Common Equity (551,470 units)
1,002
20,954
21,269
Estex Manufacturing Company, LLC
First Lien Debt (j)(az)
8.62%/0.00%
10/1/2024
10/1/2029
5,531
5,492
Common Equity (75,000 units)
6,242
6,176
Fishbowl Solutions, LLC
(S + 7.75%) / (1.00%)
11.69%/0.00%
3/25/2022
3/25/2027
22,894
22,860
12/27/2024
12,168
12,162
Revolving Loan ($3,000 unfunded commitment) (i)
35,022
35,062
Fraser Steel LLC
First Lien Debt (bm)
9.69%/0.00%
11/5/2025
2/5/2030
13,357
13,302
2/5/2025
516
13,802
13,873
Fumex, LLC
Industrial Product Services
First Lien Debt (j)(ar)
8.43%/0.00%
11/27/2029
7,000
6,964
Common Equity (3,500 units) (h)
350
324
7,314
7,324
Gap Intelligence Acquisition, LLC (dba OpenBrand)
12.00%/0.00%
1/28/2031
6,000
5,970
Preferred Equity (951 units)
Common Equity (951 units)
6,970
Global Plasma Solutions, Inc.
Common Equity (601 shares)
2/1/2024
162
293
Common Equity (1,705 shares)
9/21/2018
188
95
388
GMP HVAC, LLC (dba McGee Heating & Air, LLC)
First Lien Debt (j)(bb)
12/8/2023
12/8/2028
29,460
29,276
First Lien Debt ($3,298 unfunded commitment) (i)(bb)
6/11/2026
263
Preferred Equity (1,366 units) (h)
1,406
1,960
30,945
31,713
GPS Insight, Inc.
First Lien Debt (av)
(S + 5.58%) / (1.00%)
9.39%/0.00%
10/17/2025
5/18/2028
23,080
22,996
Green Cubes Technology, LLC (dba Green Cubes)
First Lien Debt (j)(ax)
(S + 7.50%) / (2.00%)
11.18%/0.00%
10/16/2024
10/16/2029
22,317
Haematologic Technologies, Inc.
(S + 5.25%) / (3.00%)
9.19%/3.00%
10/11/2019
9/30/2026
6,659
Common Equity (630 units) (h)
630
Common Equity (169 units) (h)
6/26/2023
169
14
7,458
6,565
Hallmark Health Care Solutions, Inc.
Common Equity (3,645,752 units)
9/18/2023
3,646
512
Hub Acquisition Sub, LLC (dba Hub Pen)
Promotional products
11.50%/1.25%
4/25/2023
6/30/2028
25,279
25,141
Common Equity (5,837 units)
3/23/2016
1,318
Common Equity (637 units)
8/7/2023
102
144
Preferred Equity (868 units)
10/16/2020
154
416
25,397
27,157
IBH Holdings, LLC (fka Inflexxion, Inc.)
Common Equity (150,000 units)
6/20/2018
InductiveHealth Informatics, LLC
First Lien Debt (j)(o)
10.43%/0.00%
1/12/2026
9/20/2028
35,808
35,705
Preferred Equity (367 units)
9/20/2024
179
224
Common Equity (1,361 units)
35,884
36,032
Info Tech Operating, LLC (dba infotech)
First Lien Debt (bd)
(S + 4.88%) / (2.00%)
8.61%/0.00%
3/31/2025
3/31/2030
18,000
17,895
Informatics Holdings, Inc. (dba Wasp Barcode Technologies)
First Lien Debt (j)(v)
(S + 7.00%) / (2.50%)
5/1/2024
3/7/2029
8,777
8,768
Preferred Equity (1,000,000 units)
3/7/2024
9,768
9,049
ISI PSG Holdings, LLC (dba Incentive Solutions, Inc.)
First Lien Debt (j)(aj)
(S + 7.50%) / (0.50%)
11.29%/0.00%
4/5/2021
7/2/2026
9,150
First Lien Debt (an)
7.79%/0.00%
6/30/2021
9,443
9,442
Common Equity (256,964 units) (h)
149
19,093
18,741
Janus Health Technologies, Inc.
Preferred Equity (68,361 units)
1/3/2024
822
Jumo Health, Inc.
First Lien Debt (j)(aw)
9.68%/0.00%
8/16/2024
8/16/2029
5,541
5,496
Common Equity (1,359 shares)
Preferred Equity (1,359 shares)
283
6,246
5,824
KG Lawn Care, Inc. (dba King Green)
First Lien Debt (bo)
(S + 5.50%) / (2.00%)
9.18%/0.00%
1/23/2026
11/26/2030
10,000
9,950
Common Equity (62 Units)
11/26/2025
616
564
10,566
10,564
The Kyjen Company, LLC (dba Outward Hound)
Common Equity (855 shares)
12/8/2017
933
Laboratory Testing, LLC
4/15/2025
4/15/2030
9,534
9,497
Revolving Loan ($3,427 unfunded commitment) (i)
573
Common Equity (3,881 units) (h)
446
Preferred Equity (3,619 units) (h)
362
10,807
11,267
Level Education Group, LLC (dba CE4Less)
First Lien Debt (ak)
(S + 5.25%) / (2.00%)
9.19%/0.00%
4/1/2021
9/30/2030
12,329
12,258
934
2,910
13,192
15,239
LifeSpan Biosciences, Inc.
11.50%/0.00%
3/19/2021
4/7/2028
16,000
15,985
15,071
Common Equity (108 shares)
6/7/2024
595
390
16,580
15,461
Mayesh Wholesale Florist, LLC
First Lien Debt (j)(be)
3/18/2025
3/18/2030
10,500
10,409
First Lien Debt (be)
1,496
717
12,405
12,717
MBS Opco, LLC (dba Marketron)
(S + 8.50%) / (1.50%)
12.45%/0.00%
9/29/2022
9/28/2026
27,000
26,992
MDME Holding Corp.
10.13%/0.00%
8/31/2023
8/3/2027
12,171
12,142
11,822
Common Equity (5,149 units)
Preferred Equity (12,500 units)
Preferred Equity (713 units)
7/1/2025
13,463
11,827
MRC Drake Buyer LLC
First Lien Debt (j)(p)
3/13/2026
3/13/2031
5,625
5,585
Common Equity (750,000 units)
6,335
National OnDemand, Inc.
Telecommunication Services
First Lien Debt (bp)
9.73%/0.00%
6/30/2026
15,438
15,206
Netbase Solutions, Inc. (dba Netbase Quid)
First Lien Debt (ap)
(P + 2.00%) / (3.25%)
8.75%/2.00%
11/18/2021
11/18/2026
16,895
16,890
15,513
NWS Technologies, LLC
First Lien Debt ($673 unfunded commitment)(u)
(S + 7.50%) / (2.50%)
11.19%/0.00%
6/20/2023
6/16/2028
18,702
18,593
Common Equity (2 units) (h)
2,446
2,186
Preferred Equity (0.375 units) (h)
453
21,341
OnePath Systems, LLC (n)
Common Equity (732,542 shares)
9/30/2022
Onsight Industries, LLC
First Lien Debt (j)(bf)
(S + 5.50%) / (1.50%)
3/27/2025
1/7/2030
8,913
8,890
Common Equity (380,000 units) (h)
1/7/2025
380
259
9,270
9,172
Palmetto Moon, LLC
11
Common Equity (499 units)
11/3/2016
1,427
PayEntry Financial Services, Inc. (dba Payentry)
Second Lien Debt (bg)
10.50%/1.75%
3/28/2025
9/28/2031
5,676
5,630
2,906
2,894
Second Lien Debt ($3,126 unfunded commitment)
Preferred Equity (10,000 units)
1,050
9,524
9,632
Pinnergy, Ltd.
Oil & Gas Services
10.00%/0.00%
6/30/2022
10,050
10,035
10,009
PowerGrid Services Acquisition, LLC
Common Equity (4,490 units) (h)
9/21/2021
Common Equity (118 units) (h)
7/2/2025
118
Common Equity (133 units) (h)
133
33
304
62
Prime AE Group, Inc.
Preferred Equity (900,000 shares)
11/25/2019
900
303
Pronto Plumbing & Drain, Inc.
5/22/2025
5/22/2030
15,389
15,247
Revolving Loan ($500 unfunded commitment)(i)
Common Equity (Units N/A) (h)
914
16,157
16,377
Puget Collision, LLC
(S + 5.00%) / (0.75%)
8.73%/0.00%
10/3/2025
10/3/2030
12,469
12,402
Common Equity (310 units) (h)
1/4/2024
970
13,212
13,439
PureCars Technologies, LLC
First Lien Debt (k)(ac)
(S + 6.63%) / (2.00%)
10.30%/0.00%
4/8/2026
4/8/2029
21,500
21,202
QED Technologies International, Inc.
First Lien Debt (q)
(S + 4.75%) / (1.50%)
8.94%0.00%
3/1/2023
3/1/2028
15,551
15,507
First Lien Debt (j)(q)
5/30/2025
2,103
2,064
Common Equity (140 shares)
1,401
4,274
18,972
21,928
Quest Software US Holdings Inc.
(S + 1.00%) / (0.50%)
4.66%/6.75%
8/11/2025
2/1/2030
18,303
12,605
R1 Holdings, LLC (dba RoadOne IntermodaLogistics)
Transportation services
10.41%/0.00%
12/30/2022
12/30/2028
6,199
6,093
8.75%/5.00%
6/30/2029
1,591
1,569
Common Equity (280,000 units)
280
96
7,942
7,796
R.F. Fager Company LLC
12.75%/0.00%
3/4/2024
8/4/2030
17,934
Common Equity (12,500 units) (h)
1,541
19,184
19,541
Sales Rabbit, Inc.
12.00%/2.00%
12/23/2025
12/23/2030
26,480
26,225
ServicePower, Inc.
First Lien Debt (k)(as)
10.50%/5.50%
3/15/2024
3/15/2028
30,956
30,795
8.25%/0.00%
6/6/2025
30,800
30,961
SES Investors, LLC (dba SES Foam) (n)
Common Equity (6,000 units) (h)
9/8/2016
Sogno Toscano LLC
First Lien Debt (bi)
9.23%/0.00%
4/24/2031
12,750
12,672
Preferred Equity (6 units)
4,249
7,650
16,921
20,400
Tedia Company, LLC
11.70%/0.00%
3/4/2022
3/4/2027
14,100
14,088
Revolving Loan ($1,750 unfunded commitment) (i)
497
10.00%/4.50%
9/4/2027
3,420
3,417
4,603
Preferred Equity (1,000 units) (h)
1,293
19,002
20,496
Thrust Flight LLC
First Lien Debt (j)(au)
9.43%/0.00%
12,586
12,515
First Lien Debt ($1,818 unfunded commitment)(i)(au)
Subordinated Debt (j)
3/9/2030
1,564
1,538
Common Equity (1,050,000 units) (h)
508
15,103
14,658
True Environmental Inc.
First Lien Debt (j) (bj)
5/12/2025
5/12/2030
6,650
6,614
15,142
15,061
Common Equity (397,026 units) (h)
585
395
22,260
22,187
UBEO, LLC
Common Equity (705,000 units) (h)
4/3/2018
610
2,089
United Biologics, LLC
Preferred Equity (98,377 units) (h)
4/1/2012
891
Warrant (57,469 units) (m)
3/5/2012
1,455
USG AS Holdings, LLC (n)
Common Equity (Units N/A)
2/21/2023
Virginia Tile Company, LLC (n)
12/19/2014
Virtex Enterprises, LP
Second Lien Debt (y)
(S + 0.00%) / (2.50%)
3.74%/9.75%
4/13/2022
18,601
10,907
Subordinated Debt (y)
(S + 4.00%) / (2.50%)
9.74%/0.00%
9/20/2023
3/31/2027
356
197
VMS MSO, LLC (dba Vytal Health Partners)
13.75%/0.00%
12/18/2025
12/18/2030
14,626
14,556
14,917
Revolving Loan ($1,500 unfunded commitment)(i)
(7
14,549
W50 Holdings, LLC
3/22/2024
3/24/2031
11,430
11,325
Preferred Equity (Units N/A) ($100 unfunded commitment)
3/21/2024
12,225
12,340
Waterworks Solutions Acquisition, Inc. (dba CITCO Water)
First Lien Debt ($2,450 unfunded commitment)(bh)
12/26/2025
12/26/2030
26,422
26,261
White Label Communication, LLC
First Lien Debt (j)(ab)
(S + 5.25%) / (1.00%)
24,400
24,278
23,864
Common Equity (536 units) (h)
10/11/2023
Preferred Equity (5,000 units) (h)
435
24,778
24,299
Wonderware Holdings, LLC (dba CORE Business Technologies)
First Lien Debt (z)
2/10/2021
5/14/2028
8,316
World Tours LLC
First Lien Debt (ay)
11/13/2024
11/13/2029
5,389
5,359
Preferred Equity (1,000,000 units) (h)
1,124
6,359
6,513
Worldwide Express Operations, LLC
Common Equity (198 units)
6/2/2026
198
Common Equity (644 units)
644
643
Common Equity (15,105 units)
44
Common Equity (188 units) (h)
Common Equity (610 units) (h)
Common Equity (14,296 units) (h)
42
1,726
1,725
Total Non-control/Non-affiliate Investments
1,325,735
177
Total Investments
1,404,431
194
Money market funds (included in cash and cash equivalents)
Goldman Sachs Financial Square Treasury Obligation Institution CUSIP (38141W323) (ad)
3.52%/0.00%
37,547
Total money market funds
Total Investments and Money Market Funds
1,441,978
1,470,458
199
(a) See Note 3 to the consolidated financial statements for portfolio composition by geographic location.
(b) Equity ownership may be held in shares or units of companies related to the portfolio companies. The Company’s investments are generally classified as “restricted securities”, unless otherwise noted, as such term is defined under Regulation S-X Rule 6-03(f) or Securities Act Rule 144. As of June 30, 2026, the Company held restricted securities with an aggregate fair value of $1,432,911, or 194% of the Company's net assets.
(c) All debt investments are income producing, unless otherwise indicated. Equity investments are non-income producing unless otherwise noted.
13
(d) Variable rate investments bear interest at a rate indexed to prime (P) or Secured Overnight Financing Rate (“SOFR”) (S), which are reset monthly, bimonthly, quarterly, or semi-annually. Certain variable rate investments also include a prime or SOFR interest rate floor. For each investment, the Company has provided the spread over the reference rate and the prime or SOFR floor, if any, as of June 30, 2026.
(e) Rate includes the cash interest or dividend rate and paid-in-kind interest or dividend rate, if any, as of June 30, 2026. Generally, payment-in-kind interest can be paid-in-kind or all in cash.
(f) Investment date represents the date of the initial investment in the security.
(g) Except as otherwise noted, the Company’s investment portfolio is comprised of debt and equity securities of privately held companies for which quoted prices falling within the categories of Level 1 and Level 2 inputs are not available. Therefore, the Company values all of its portfolio investments at fair value, as determined in good faith by the board of directors, using significant unobservable Level 3 inputs.
(h) Investment is held by a taxable subsidiary of the Company.
(i) The disclosed commitment represents the unfunded amount as of June 30, 2026. The Company is earning 0.50% interest on the unfunded balance of the commitment. The interest rate disclosed represents the rate which will be earned if the commitment is funded.
(j) The investments of FIC Funding, LLC (the “SPV”) are pledged as collateral to the SPV’s financing credit facility (the “SPV Credit Facility”) and, as a result, are not directly available to the creditors of the Company to satisfy any obligations of the Company other than the Company's obligations under the SPV Credit Facility (see Note 6 to the consolidated financial statements).
(k) The portion of the investment not held by the SBIC Funds is pledged as collateral for the SPV Credit Facility and, as a result, is not directly available to the creditors of the Company to satisfy any obligations of the Company other than the Company's obligations under the SPV Credit Facility (see Note 6 to the consolidated financial statements).
(l) As defined in the 1940 Act, the Company is deemed to be an "Affiliated Person" of this portfolio company because it owns 5% or more of the portfolio company's outstanding voting securities or it has the power to exercise control over the management or policies of such portfolio company. Transactions in which the issuer was an Affiliated Person are detailed in Note 3 to the consolidated financial statements.
(m) Warrants entitle the Company to purchase a predetermined number of shares or units of common equity, and are non-income producing. The purchase price and number of shares are subject to adjustment under certain conditions until the expiration date, if any.
(n) Investment in portfolio company that has sold its operations and is in the process of winding down.
(o) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.26% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(p) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 3.50% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(q) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.93% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(r) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.62% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(s) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 0.38% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(t) As defined in the 1940 Act, the Company is deemed to be both an “Affiliated Person” of and “Control” this portfolio company because it owns 25% or more of the portfolio company’s outstanding voting securities or it has the power to exercise control over the management or policies of such portfolio company. Transactions in which the issuer was both an Affiliated Person and a portfolio company that the Company is deemed to Control are detailed in Note 3 to the consolidated financial statements.
(u) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.19% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(v) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 1.04% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(w) The disclosed commitment represents the unfunded amount as of June 30, 2026. The Company is earning 0.75% interest on the unfunded balance of the commitment. The interest rate disclosed represents the rate earned on the outstanding, funded balance of the commitment.
(x) The disclosed commitment represents the unfunded amount as of June 30, 2026. The Company is earning 1.00% interest on the unfunded balance of the commitment. The interest rate disclosed represents the rate earned on the outstanding, funded balance of the commitment.
(y) Investment was on non-accrual status as of June 30, 2026.
(z) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.49% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(aa) The Company sold a participating interest of approximately $4.0 million in aggregate principal amount of the portfolio company’s first lien senior secured term loan. As the transaction did not qualify as a “true sale” in accordance with GAAP, the Company recorded a corresponding secured borrowing in the Consolidated Statements of Assets and Liabilities.
(ab) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 1.91% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(ac) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 3.13% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(ad) This investment is classified as a Level 1 investment. For further detail on the fair value measurements, see Note 4 to the consolidated financial statements.
(ae) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.28% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(af) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 3.28% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(ag) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 1.70% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(ah) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 3.71% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(ai) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.70% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(aj) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 4.88% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(ak) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 3.42% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(al) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 3.86% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(am) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 3.59% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(an) The Company sold a participating interest of approximately $13.5 million in aggregate principal amount of the portfolio company’s first lien senior secured term loan. As the transaction did not qualify as a “true sale” in accordance with GAAP, the Company recorded a corresponding secured borrowing in the Consolidated Statements of Assets and Liabilities.
(ao) The investment is treated as a non-qualifying asset under Section 55(a) of the Investment Company Act of 1940, as amended (the “1940 Act”). Under the 1940 Act, the Company can not acquire any non-qualifying asset unless, at the time the acquisition is made, qualifying assets represent at least 70% of the Company's total assets. As of June 30, 2026, total non-qualifying assets at fair value represented 1.07% of the Company's total assets calculated in accordance with the 1940 Act.
(ap) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional cash interest amount of 0.45% and PIK interest amount of 1.79% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(aq) The headquarters of this portfolio company is located in Canada.
(ar) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.57% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(as) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional cash interest amount of 0.34% and PIK interest amount of 0.56% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(at) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.19% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(au) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.13% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(av) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.67% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(aw) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.50% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(ax) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 0.99% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(ay) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.00% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(az) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.34% on its “last out” tranche of the portfolio company’s senior term debt, which was
previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(ba) The Company sold a participating interest of approximately $0.005 million in aggregate principal amount of the portfolio company’s first lien senior secured term loan. As the transaction did not qualify as a “true sale” in accordance with GAAP, the Company recorded a corresponding secured borrowing in the Consolidated Statements of Assets and Liabilities.
(bb) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 3.15% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(bc) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional cash interest amount of 2.20% and PIK interest amount of 0.73% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(bd) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 3.04% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(be) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.94% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(bf) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.38% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(bg) As of June 30, 2026, the Company is earning an incremental 0.60% interest on the outstanding principal balance.
(bh) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 3.96% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(bi) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 3.43% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(bj) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 3.32% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(bk) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.36% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(bl) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 3.08% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(bm) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.27% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(bn) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 0.00% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(bo) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.93% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(bp) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 3.25% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
15
Consolidated Schedule of Investments
7,183
9,702
26,487
5,861
5,825
571
6,325
6,432
238
308
40,995
9,000
8,949
Revolving Loan ($3,000 unfunded commitment)(i)
(14
9,685
9,699
9.93%/0.00%
28,372
2,762
35,538
31,197
3,897
75,208
12.13%/0.00%
6,598
6,590
8.38%/0.00%
1,846
9,436
8,444
11.75%/1.50%
11,775
11,681
12,681
12,775
5,744
13,055
13,050
Revolving Loan
1,010
998
20,891
20,807
8.67%/0.00%
15,917
15,847
Revolving Loan ($1,195 unfunded commitment) (i)
242
1,249
1,168
17,338
17,332
8.74%/0.00%
799
7,125
7,124
18,622
17,418
15,826
18,122
First Lien Debt (p)
10.68%/0.00%
6/28/2021
3/31/2028
22,218
22,192
21,617
First Lien Debt (o)
8.18%/0.00%
330
First Lien Debt (bh)
15.25%/0.00%
3/28/2024
5,864
11,997
29,768
33,944
9.92%/0.00%
6,998
6,983
2,223
7,983
9,221
9,957
Preferred Equity (801,414 shares)
801
852
10,758
10,852
10.99%/0.00%
18,200
18,159
2,505
2,492
1,374
21,851
22,066
907
906
1,993
Common Equity (500 units)
3,399
2,900
10.49%/0.00%
13,548
1,258
14,693
14,858
8.94%/0.00%
9,979
9,930
1,605
11,230
11,535
31,795
31,777
29,528
7.24%/0.00%
Common Equity (5,474 units) (h)
2,013
1,380
33,807
30,913
17,588
393
15,886
Common Equity (1,000,000 LP Units) ($250 unfunded commitment)
16,886
9.38%/0.00%
24,000
23,744
1,736
25,457
26,450
(S + 5.50%) / (0.75%)
9.20%/0.00%
14,663
14,569
332
190
14,659
15,091
CIH Intermediate, LLC
3,464
270
670
3,976
10.57%/0.75%
7,986
7,946
7,922
11.50%/2.75%
2,380
2,370
2,211
10,716
10,133
8.82%/0.50%
15,188
15,101
827
15,872
16,015
1,703
First Lien Debt (ac)
(S + 5.75%) / (4.00%)
9.75%/1.00%
7/21/2026
13,766
13,748
7.50%/7.50%
1/21/2027
12,511
12,486
Common Equity (1,000 Units) (h)
Preferred Equity (1,000 Units) (h)
1,033
27,234
27,310
(S + 5.75%) / (2.25%)
9.74%/2.50%
27,712
27,628
12.24%/0.00%
2,848
2,842
501
31,069
31,061
11.17%/0.00%
24,143
23,623
551
24,694
23,711
9.67%/0.00%
24,113
Common Equity (679,301 units)
728
1,691
24,841
25,900
8,082
8,044
1,326
9,544
9,408
First Lien Debt ($3,000 unfunded commitment)
9.74%/2.00%
18,572
18,503
19,253
19,582
8.87%/0.00%
5,486
566
6,236
6,097
11.97%/0.00%
22,836
22,895
18
12,159
34,995
35,063
13,800
13,737
549
14,237
14,349
8.75%/0.00%
6,959
346
7,309
7,346
Preferred Equity (601 shares)
282
481
10.37%/0.00%
29,246
1,890
30,652
31,350
9.57%/0.00%
23,201
23,094
11.46%/0.00%
22,289
9.49%/3.00%
6,579
6,381
7,378
1,638
25,121
24,947
1,224
134
363
25,203
26,842
(S + 7.75%) / (2.00%)
11.71%/0.50%
35,065
34,775
2,993
2,964
2,994
292
38,031
38,389
8.55%/0.00%
17,882
(S + 6.50%) / (2.50%)
8,989
504
9,989
9,504
11.32%/0.00%
4/5/2026
9,465
9,460
7.82%/0.00%
9,813
9,809
349
19,773
19,623
1,020
9.46%/0.00%
5,940
5,888
438
6,638
6,378
First Lien Debt ($2,500 unfunded commitment)(i)
9.34%/0.00%
9,933
9,945
10,549
10,561
19
9.24%/0.00%
9,606
9,565
558
555
10,873
10,988
9.47%/0.00%
12,485
2,798
13,339
14,983
421
16,575
15,404
9.96%/0.00%
10,397
First Lien Debt ($2,000 unfunded commitment)(i)(be)
736
10,897
11,236
26,975
10.07%/0.00%
12,233
12,191
11,677
73
75
13,512
11,825
16,564
First Lien Debt ($1,140 unfunded commitment)(u)
17,760
17,627
Common Equity (1 unit) (h)
1,125
1,760
440
19,127
19,960
9.49%/0.00%
9,120
9,094
351
9,474
9,471
1,169
5,626
5,576
2,880
2,868
Second Lien Debt ($3,125 unfunded commitment)
1,104
9,444
9,610
43
48
100
8,683
8,598
563
604
9,157
9,287
(S + 4.75%) / (0.75%)
8.42%/0.00%
12,500
12,426
1,058
20
13,236
13,484
9.24%0.00%
15,494
2,052
1,402
4,018
18,948
21,672
4.84%/6.75%
17,698
16,582
9.95%/0.00%
6,231
6,104
1,552
1,526
1,459
127
7,910
7,817
17,926
1,450
19,176
19,450
22,762
22,515
30,033
29,826
29,831
30,038
9.00%/0.00%
1/2/2029
8,500
8,445
4,250
12,695
0.00%/13.00%
10/29/2021
6/1/2028
23,590
15,934
1,476
Common Equity (97,808 units) (h)
12/1/2021
857
16,791
14,080
495
7.25%/7.25%
3,322
3,317
3,606
994
18,892
19,200
9.71%/0.00%
12,503
681
15,049
14,763
6,610
First Lien Debt ($1,125 unfunded commitment)(bj)
First Lien Debt ($2,250 unfunded commitment)(bj)
13,300
13,219
Common Equity (312,500 units) (h)
246
20,329
20,196
655
1,967
USG AS Holdings, LLC
2,802
3.82%/9.75%
17,381
9.82%/0.00%
307
208
11,214
15,000
14,923
21
14,916
12,383
819
13,283
13,319
First Lien Debt ($3,500 unfunded commitment)(z)(bm)
8.44%/0.00%
15,995
15,875
9.21%/0.00%
24,263
24,763
8.72%/0.00%
5,965
1,517
6,965
7,517
Common Equity (795,000 units)
7/21/2021
795
Common Equity (752,380 units) (h)
7/26/2021
225
762
1,756
Zonkd, LLC
Common Equity (4,987 units) (h)
3/18/2022
487
1,222,476
163
1,299,294
3.65%/0.00%
68,974
1,368,268
1,393,727
(b) Equity ownership may be held in shares or units of companies related to the portfolio companies. The Company’s investments are generally classified as “restricted securities”, unless otherwise noted, as such term is defined under Regulation S-X Rule 6-03(f) or Securities Act Rule 144. As of December 31, 2025, the Company held restricted securities with an aggregate fair value of $1,324,753, or 179% of the Company's net assets.
(d) Variable rate investments bear interest at a rate indexed to prime (P) or Secured Overnight Financing Rate (“SOFR”) (S), which are reset monthly, bimonthly, quarterly, or semi-annually. Certain variable rate investments also include a prime or SOFR interest rate floor. For each investment, the Company has provided the spread over the reference rate and the prime or SOFR floor, if any, as of December 31, 2025.
(e) Rate includes the cash interest or dividend rate and paid-in-kind interest or dividend rate, if any, as of December 31, 2025. Generally, payment-in-kind interest can be paid-in-kind or all in cash.
(i) The disclosed commitment represents the unfunded amount as of December 31, 2025. The Company is earning 0.50% interest on the unfunded balance of the commitment. The interest rate disclosed represents the rate which will be earned if the commitment is funded.
(o) The Company sold a participating interest of approximately $0.3 million in aggregate principal amount of the portfolio company’s first lien senior secured term loan. As the transaction did not qualify as a “true sale” in accordance with U.S. generally accepted accounting principles (“GAAP”), the Company recorded a corresponding secured borrowing in the Consolidated Statements of Assets and Liabilities.
(p) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 1.72% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(q) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.94% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(r) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.74% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(s) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 1.56% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(u) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.30% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(v) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 1.07% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(w) The disclosed commitment represents the unfunded amount as of December 31, 2025. The Company is earning 0.75% interest on the unfunded balance of the commitment. The interest rate disclosed represents the rate earned on the outstanding, funded balance of the commitment.
(x) The disclosed commitment represents the unfunded amount as of December 31, 2025. The Company is earning 1.00% interest on the unfunded balance of the commitment. The interest rate disclosed represents the rate earned on the outstanding, funded balance of the commitment.
(y) Investment was on non-accrual status as of December 31, 2025.
(z) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.50% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(ab) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 1.92% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(ac) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional cash interest amount of 2.86% and PIK interest amount of 1.27% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(ae) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.21% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(ag) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 1.68% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(ah) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 3.75% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(ai) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.84% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(aj) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 4.83% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(ak) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 3.41% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(al) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 3.93% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(am) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 3.33% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(ao) The investment is treated as a non-qualifying asset under Section 55(a) of the Investment Company Act of 1940, as amended (the “1940 Act”). Under the 1940 Act, the Company can not acquire any non-qualifying asset unless, at the time the acquisition is made, qualifying assets represent at least 70% of the Company's total assets. As of December 31, 2025, total non-qualifying assets at fair value represented 1.12% of the Company's total assets calculated in accordance with the 1940 Act.
(ap) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional cash interest amount of 0.46% and PIK interest amount of 1.83% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(ar) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.59% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(as) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional cash interest amount of 0.24% and PIK interest amount of 0.59% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(at) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.36% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(au) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.18% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(ax) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 1.02% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(ay) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.06% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(az) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.36% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(bb) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.71% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(bc) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional cash interest amount of 2.20% and PIK interest amount of 0.74% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(bd) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 3.06% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(be) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.97% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(bf) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.40% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(bg) As of December 31, 2025, the Company is earning an incremental 0.60% interest on the outstanding principal balance.
(bh) The fair value for this investment includes a multiple of invested capital fee equal to (i) the principal amount repaid multiplied by a return percentage that is subject to change based upon the loan repayment date minus (ii) the sum of (a) the principal amount repaid plus (b) all interest paid in cash on such principal amount plus (c) the aggregate amount of fees paid in cash on or prior to the date of such repayment.
(bi) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 1.25% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(bj) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 3.20% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(bk) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 3.00% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(bl) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 3.10% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(bm) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 3.71% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
(bn) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.34% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.
See Notes to Consolidated Financial Statements.
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Note 1. Organization and Nature of Business
Fidus Investment Corporation (“FIC,” and together with its subsidiaries, the “Company”), a Maryland corporation, operates as an externally managed, closed-end, non-diversified business development company (“BDC”) under the Investment Company Act of 1940, as amended (“1940 Act”). FIC completed its initial public offering, or IPO, in June 2011. In addition, for U.S. federal income tax purposes, the Company has elected, and intends to qualify annually, to be treated as a regulated investment company (“RIC”) under subchapter M of the Internal Revenue Code of 1986, as amended (the “Code”).
The Company provides customized debt and equity financing solutions to lower middle-market companies, and may make investments directly or through its two wholly-owned investment company subsidiaries, Fidus Mezzanine Capital III, L.P. (“Fund III”) and Fidus Mezzanine Capital IV, L.P. (“Fund IV” and together with Fund III, the “SBIC Funds”). Each SBIC Fund is licensed by the U.S. Small Business Administration (the “SBA”) as a small business investment company (“SBIC”). The SBIC licenses allow the SBIC Funds to obtain leverage by issuing SBA-guaranteed debentures (“SBA debentures”), subject to the issuance of leverage commitments by the SBA and other customary procedures. As SBICs, the SBIC Funds are subject to regulations of and oversight by the SBA under the Small Business Investment Act of 1958, as amended (the “SBIC Act”), concerning, among other things, the size and nature of the companies in which they may invest and the structure of those investments.
The Company believes that utilizing both FIC and the SBIC Funds as investment vehicles provides it with access to a broader array of investment opportunities. Given the Company’s access to lower cost capital through the SBA’s SBIC debenture program, the Company expects that it will make investments through active SBIC Funds until the earlier of the end of such fund's investment period, or when the fund reaches its borrowing limit under the SBA program. In May 2026, legislation amending the SBIA Act increased (a) the individual leverage limit from $175,000 to $250,000, subject to SBA approval, and (b) the maximum leverage available for two or more SBICs under common control from $350,000 to $475,000.
Fund III and Fund IV are not registered under the 1940 Act and rely on the exclusion from the definition of investment company contained in Section 3(c)(7) of the 1940 Act.
The Company pays a quarterly base management fee and an incentive fee to Fidus Investment Advisors, LLC, our investment advisor (the “Investment Advisor” or “Fidus Investment Advisors”) under an investment advisory agreement (the “Investment Advisory Agreement”).
Note 2. Significant Accounting Policies
Basis of presentation: The accompanying consolidated financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) pursuant to the requirements for reporting on Form 10-Q, Accounting Standards Codification (“ASC”) 946, Financial Services – Investment Companies (“ASC 946”), and Articles 6 and 10 of Regulation S-X. In the opinion of management, the consolidated financial statements reflect all adjustments and reclassifications consisting solely of normal accruals that are necessary for the fair presentation of financial results as of and for the periods presented. Certain prior period amounts have been reclassified to conform to the current period presentation. The current period’s results of operations are not necessarily indicative of results that ultimately may be achieved for the year. Therefore, the unaudited financial statements and notes should be read in conjunction with the audited financial statements and notes thereto for the year ended December 31, 2025.
Use of estimates: The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Consolidation: Pursuant to Article 6 of Regulation S-X and ASC 946, the Company will generally not consolidate its investments in a company other than an investment company subsidiary or a controlled operating company whose business consists of providing services to the Company. As a result, the consolidated financial statements of the Company include only the accounts of the Company and its wholly-owned subsidiaries. All significant intercompany balances and transactions have been eliminated.
Investment risks: The Company’s investments are subject to a variety of risks. These risks may include, but are not limited to the following:
Fair value of financial instruments: The Company measures and discloses fair value with respect to substantially all of its financial instruments in accordance with ASC Topic 820 — Fair Value Measurements and Disclosures (“ASC Topic 820”). ASC Topic 820 defines fair value, establishes a framework used to measure fair value, and requires disclosures for fair value measurements, including the categorization of financial instruments into a three-level hierarchy based on the transparency of valuation inputs. See Note 4. Fair Value Measurements to the consolidated financial statements for further discussion regarding the fair value measurements and hierarchy.
Investment classification: The Company classifies its investments in accordance with the requirements of the 1940 Act. Under the 1940 Act, “Control Investments” are defined as investments in companies where the Company owns more than 25% of the voting securities of such company or has rights to maintain greater than 50% of the board representation. Under the 1940 Act, “Affiliate Investments” are defined as investments in companies where the Company owns between 5% and 25% of the voting securities of such company. “Non-Control/Non-Affiliate Investments” are those that neither qualify as Control Investments nor Affiliate Investments.
Segments: In accordance with ASC Topic 280 — Segment Reporting, the Company is externally managed and has determined that it has a single reporting segment and operating unit structure, which derives investment income from its portfolio investments. The chief operating decision maker (the “CODM”) assesses performance for the Company based on net investment income, net realized and unrealized gains (losses) from investments, and net increase (decrease) in net assets resulting from operations, which are reported on the consolidated statements of operations. The CODM also may assess the Company's performance by completing an industry benchmarking analysis using the metrics disclosed in Note 10. Financial Highlights. The CODM is the Investment Advisor’s investment committee. Subject to the overall supervision of the Company's board of directors, the Investment Advisor manages the day-to-day operations of, and provides investment advisory and management services to the Company. The information and operating expense categories included in the consolidated statements of operations are fully reflective of the significant expense categories and amounts that are regularly provided to the CODM.
Restricted cash and cash and cash equivalents: Cash and cash equivalents are highly liquid investments with an original maturity of three months or less at the date of acquisition. The Company places its cash in financial institutions and, at times, such balances may be in excess of the Federal Deposit Insurance Corporation insurance limits. The Company does not believe its cash balances are exposed to any significant credit risk. Restricted cash includes amounts that are collected and are held by a trustee who
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has been appointed as custodian of the assets securing the Company’s line of credit. Restricted cash is held by the trustee for payment of interest expense and principal on the outstanding borrowings or reinvestment into new assets.
Deferred financing costs: Deferred financing costs consist of fees and expenses paid in connection with the SBA debentures, the SPV Credit Facility and the unsecured notes (each as described in Note 6). Deferred financing costs are capitalized and amortized to interest and financing expenses over the term of the debt agreement using the effective interest method. Unamortized deferred financing costs are presented as an offset to the corresponding debt liabilities on the consolidated statements of assets and liabilities.
Realized losses on extinguishment of debt: Upon the repayment of debt obligations which are deemed to be extinguishments, the difference between the principal amount due at maturity, adjusted for any unamortized deferred financing costs, is recognized as a loss (i.e., the unamortized deferred financing costs are recognized as a loss upon extinguishment of the underlying debt obligation).
Deferred offering costs: Deferred offering costs consist of fees paid in relation to legal, accounting, regulatory and printing work completed in preparation of offering its securities. Upon the completion of an equity offering or a debt offering, the deferred expenses are charged to additional paid-in capital or deferred financing costs, respectively. If no offering is completed prior to the expiration of the registration statement, the deferred costs are charged to expense. These expenses are included in prepaid expenses and other assets on the consolidated statements of assets and liabilities.
Realized gains or losses and unrealized appreciation or depreciation on investments: Realized gains or losses on investments are recorded upon the sale or disposition of a portfolio investment and are calculated as the difference between the net proceeds from the sale or disposition and the cost basis of the investment, without regard to unrealized appreciation or depreciation previously recognized. Net change in unrealized appreciation or depreciation on the consolidated statements of operations includes changes in the fair value of investments from the prior period, as determined in good faith by the Company’s board of directors (the “Board”) through the application of the Company’s valuation policy, as well as reclassifications of any prior period unrealized appreciation or depreciation on exited investments to realized gains or losses on investments.
Interest and dividend income: Interest and dividend income are recorded on the accrual basis to the extent that the Company expects to collect such amounts. Interest is accrued daily based on the outstanding principal amount and the contractual terms of the debt. Dividend income is recorded as dividends are declared or at the point an obligation exists for the portfolio company to make a distribution, and is generally recognized when received. Distributions from portfolio companies are evaluated to determine if the distribution is a distribution of earnings or a return of capital. Distributions of earnings are included in dividend income while a return of capital is recorded as a reduction in the cost basis of the investment. Estimates are adjusted as necessary after the relevant tax forms are received from the portfolio company.
PIK income: Certain of the Company’s investments contain a payment-in-kind (“PIK”) income provision. The PIK income, computed at the contractual rate specified in the applicable investment agreement, is added to the principal balance of the investment, rather than being paid in cash, and recorded as interest or dividend income, as applicable, on the consolidated statements of operations. Generally, PIK can be paid-in-kind or all in cash. The Company stops accruing PIK income when there is reasonable doubt that PIK income will be collected. PIK income that has been contractually capitalized to the principal balance of the investment prior to the non-accrual designation date is not reserved against interest or dividend income, but rather is assessed through the valuation of the investment (with corresponding adjustments to unrealized depreciation, as applicable). PIK income is included in the Company’s taxable income and, therefore, affects the amount the Company is required to pay to shareholders in the form of dividends in order to maintain the Company’s tax treatment as a RIC, even though the Company has not yet collected the cash.
Non-accrual: Debt investments or preferred equity investments (for which the Company is accruing PIK dividends) are placed on non-accrual status when principal, interest or dividend payments become materially past due, or when there is reasonable doubt that principal, interest or dividends will be collected. Any original issue discount and market discount are no longer accreted to interest income as of the date the loan is placed on full non-accrual status. Interest and dividend payments received on non-accrual investments may be recognized as interest or dividend income or may be applied to the investment principal balance based on management’s judgment. Non-accrual investments are restored to accrual status when past due principal, interest or dividends are paid and, in management’s judgment, payments are likely to remain current.
Origination and closing fees: The Company also typically receives debt investment origination or closing fees in connection with such investments. Such debt investment origination and closing fees are capitalized as unearned income and offset against investment cost basis on the consolidated statements of assets and liabilities and accreted into interest income over the life of the investment. Upon the prepayment of a debt investment, any unaccreted debt investment origination and closing fees are accelerated into interest income.
Warrants: In connection with the Company’s debt investments, the Company will sometimes receive warrants or other equity-related securities from the borrower (“Warrants”). The Company determines the cost basis of Warrants based upon their respective
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fair values on the date of receipt in proportion to the total fair value of the debt and Warrants received. Any resulting difference between the face amount of the debt and its recorded fair value resulting from the assignment of value to the Warrants is treated as original issue discount (“OID”), and accreted into interest income using the effective interest method over the term of the debt investment. Upon the prepayment of a debt investment, any unaccreted OID is accelerated into interest income.
Fee income: Transaction fees earned in connection with the Company’s investments are recognized as fee income and are generally non-recurring. Such fees typically include fees for services, including structuring and advisory services, provided to portfolio companies. The Company recognizes income from fees for providing such structuring and advisory services when the services are rendered or the transactions are completed. Upon the prepayment of a debt investment, any prepayment penalties are recorded as fee income when earned.
Partial loan and equity sales: The Company follows the guidance in ASC 860, Transfers and Servicing (“ASC 860”), when accounting for loan (debt investment) participations, equity assignments and other partial loan sales. Such guidance requires a participation, assignment or other partial loan or equity sale to meet the definition of a “participating interest,” as defined in the guidance, in order for sale treatment to be allowed. Participations, assignments or other partial loan or equity sales which do not meet the definition of a participating interest should remain on the Company’s consolidated statements of assets and liabilities and the proceeds recorded as a secured borrowing until the definition is met. For these partial loan sales, the interest earned on the entire loan balance is recorded within “interest income” and the interest earned by the buyer in the partial loan sale is recorded within “interest and financing expenses” in the accompanying consolidated statements of operations.
Income taxes: The Company has elected, and intends to qualify annually, to be treated as a RIC under subchapter M of the Code, and, as such will not be subject to U.S. federal income tax on the portion of its taxable income (including gains) distributed as dividends for U.S. federal income tax purposes to stockholders. Taxable income includes the Company’s taxable interest, dividend and fee income, reduced by certain deductions as well as taxable net realized investment gains. Taxable income generally differs from net income for financial reporting purposes due to temporary and permanent differences in the recognition of income and expenses, and generally excludes net unrealized appreciation or depreciation, as such gains or losses are not included in taxable income until they are realized. The Company’s net assets as included on the Consolidated Statements of Assets and Liabilities and Consolidated Statements of Changes in Net Assets include an adjustment to classification as a result of permanent book-to-tax differences, which include differences in the book and tax treatment of income and expenses.
To qualify as a RIC, the Company is required to meet certain income and asset diversification tests in addition to distributing dividends of an amount generally at least equal to 90% of its investment company taxable income, as defined by the Code and determined without regard to any deduction for distributions paid, to its stockholders. The amount to be paid out as a distribution is determined by the Board of Directors each quarter and is based upon the annual earnings estimated by the management of the Company. To the extent that the Company’s earnings fall below the amount of dividend distributions declared, however, a portion of the total amount of the Company’s distributions for the fiscal year may be deemed a return of capital for U.S. federal income tax purposes.
In the future, the SBIC Funds may be limited by provisions of the SBIC Act and SBA regulations governing SBICs from making certain distributions to FIC that may be necessary to enable FIC to make the minimum distributions required to maintain its RIC tax treatment.
The Company has certain wholly-owned subsidiaries (the “Taxable Subsidiaries”) that have elected to be treated as corporations for U.S. federal income tax purposes and are thus subject to U.S. federal income tax imposed at corporate rates, each of which generally holds one or more of the Company’s portfolio investments listed on the consolidated schedules of investments. The Taxable Subsidiaries are consolidated for financial reporting purposes, such that the Company’s consolidated financial statements reflect the Company’s investment in the portfolio company investments owned by the Taxable Subsidiaries. The purpose of the Taxable Subsidiaries is to permit the Company to hold equity investments in portfolio companies that are taxed as partnerships for U.S. federal income tax purposes (such as entities organized as limited liability companies (“LLCs”) or other forms of pass through entities) while complying with the “source-of-income” requirements contained in the RIC tax provisions. The Taxable Subsidiaries are not consolidated with the Company for U.S. federal income tax purposes, and each Taxable Subsidiary will be subject to U.S. federal income tax on its taxable income. Any such income or expense is reflected in the consolidated statements of operations.
U.S. federal income tax determinations differ from GAAP, and as a result, distributions for U.S. federal income tax purposes may differ from net investment income and realized gains recognized under GAAP. Differences may be permanent or temporary. Permanent differences may arise as a result of, among other items, a difference in the book and adjusted tax basis of certain assets and nondeductible U.S. federal income tax. Temporary differences arise when certain items of income, expense, gain or loss are recognized at some time in the future.
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ASC Topic 740 — Accounting for Uncertainty in Income Taxes (“ASC Topic 740”) provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the consolidated financial statements. ASC Topic 740 requires the evaluation of tax positions taken in the course of preparing the Company’s tax returns to determine whether the tax positions are “more-likely-than-not” to be respected by the applicable tax authorities. Tax benefits of positions not deemed to meet the more-likely-than-not threshold would be recorded as a tax expense in the current year. It is the Company’s policy to recognize accrued interest and penalties related to uncertain tax benefits included in the income tax provision, if any. There were no material uncertain income tax positions at June 30, 2026 and December 31, 2025. The Company’s tax returns are generally subject to examination by U.S. federal and most state tax authorities for a period of three years from the date the respective returns are filed, and, accordingly, tax years after 2021 remain subject to examination.
Dividends to stockholders: Dividends to stockholders are recorded on the record date with respect to such distributions. The amount, if any, to be distributed to stockholders, is determined by the Board each quarter and is generally based upon the earnings estimated by management. Net realized capital gains, if any, may be distributed at least annually, although the Company may decide to retain such capital gains for investment.
The determination of the tax attributes for the Company’s distributions is made annually, and is based upon the Company’s taxable income and distributions paid to its stockholders for the full year. Ordinary dividend distributions from a RIC do not qualify for the preferential tax rate on qualified dividend income from domestic corporations and qualified foreign corporations, except to the extent that the RIC received the income in the form of qualifying dividends from domestic corporations and qualified foreign corporations. The tax characterization of the Company’s distributions generally includes both ordinary income and capital gains but may also include qualified dividends or return of capital.
The Company has adopted a dividend reinvestment plan (“DRIP”) that provides for the reinvestment of dividends on behalf of its stockholders, unless a stockholder has elected to receive dividends in cash. As a result, if the Company declares a cash dividend, the Company’s stockholders who have not “opted out” of the DRIP at least two days prior to the dividend payment date will have their cash dividend automatically reinvested into additional shares of the Company’s common stock. The Company has the option to satisfy the share requirements of the DRIP through the issuance of new shares of common stock or through open market purchases of common stock by the DRIP plan administrator. Newly issued shares are valued based upon the final closing price of the Company’s common stock on a date determined by the Board. Shares purchased in the open market to satisfy the DRIP requirements will be valued based upon the average price of the applicable shares purchased by the DRIP plan administrator before any associated brokerage or other costs. See Note 9. Dividends and Distributions to the consolidated financial statements regarding dividend declarations and distributions.
Earnings and net asset value per share: The earnings per share calculations for the three and six months ended June 30, 2026 and 2025 are computed utilizing the weighted average shares outstanding for the period. Net asset value per share is calculated using the number of shares outstanding as of the end of the period.
Stock Repurchase Program: The Company has an open market stock repurchase program (the “Stock Repurchase Program”) under which the Company may acquire up to $5,000 of its outstanding common stock. Under the Stock Repurchase Program, the Company may, but is not obligated to, repurchase outstanding common stock in the open market from time to time provided that the Company complies with the prohibitions under its insider trading policies and the requirements of Rule 10b-18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), including certain price, market value and timing constraints. The timing, manner, price and amount of any share repurchases will be determined by the Company’s management, in its discretion, based upon the evaluation of economic and market conditions, stock price, capital availability, applicable legal and regulatory requirements and other corporate considerations. Most recently, on November 3, 2025, the Board extended the Stock Repurchase Program through December 31, 2026, or until the approved dollar amount has been used to repurchase shares. The Stock Repurchase Program does not require the Company to repurchase any specific number of shares and the Company cannot assure that any shares will be repurchased under the Stock Repurchase Program. The Stock Repurchase Program may be suspended, extended, modified or discontinued at any time. The Company did not make any repurchases of common stock during the three and six months ended June 30, 2026 and 2025. Refer to Note 8. Common Stock for additional information concerning stock repurchases.
28
Note 3. Portfolio Company Investments
The Company’s portfolio investments principally consist of secured and unsecured debt, equity warrants and direct equity investments primarily in privately held companies. The debt investments may or may not be secured by either a first or second lien on the assets of the portfolio company. The debt investments generally bear interest at fixed rates or variable rates, and generally mature between five and seven years from the original investment. In connection with a debt investment, the Company also may receive nominally priced equity warrants and/or make a direct equity investment in the portfolio company. The Company’s warrants or equity investments may be investments in a holding company related to the portfolio company. In addition, the Company makes equity investments in portfolio companies organized as LLCs or other forms of pass-through entities through Taxable Subsidiaries. In both situations, the investment is generally reported under the name of the operating company on the consolidated schedules of investments.
As of June 30, 2026, the Company had active investments in 100 portfolio companies and residual investments in eight portfolio companies that have sold their underlying operations. The aggregate fair value of the total portfolio was $1,432,911 and the weighted average yield on the Company’s debt investments was 12.5% as of such date. As of June 30, 2026, the Company held equity investments in 82.4% of its portfolio companies and the average fully diluted equity ownership in those portfolio companies was 2.1%.
As of December 31, 2025, the Company had active investments in 97 portfolio companies and residual investments in six portfolio companies that have sold their underlying operations. The aggregate fair value of the total portfolio was $1,324,753 and the weighted average yield on the Company’s debt investments was 12.6% as of such date. As of December 31, 2025, the Company held equity investments in 85.4% of its portfolio companies and the average fully diluted equity ownership in those portfolio companies was 1.9%.
The weighted average yield of the Company’s debt investments is not the same as a return on investment for its stockholders but, rather, relates to a portion of the Company’s investment portfolio and is calculated before the payment of all of the Company’s and its subsidiaries’ fees and expenses. The weighted average yields were computed using the effective interest rates for debt investments at cost as of June 30, 2026 and December 31, 2025, including accretion of OID and debt investment origination fees, but excluding investments on non-accrual status and investments recorded as a secured borrowing.
Purchases of debt and equity investments for the six months ended June 30, 2026 and 2025 totaled $216,662 and $210,006, respectively. Proceeds from sales and repayments, including principal, return of capital distributions and realized gains, of portfolio investments for the six months ended June 30, 2026 and 2025 totaled $112,228 and $166,605, respectively.
Investments by type with corresponding percentage of total portfolio investments consisted of the following:
Fair Value
First Lien Debt(1)
1,133,579
79.1
1,019,063
77.0
1,141,928
81.3
1,014,497
78.1
70,562
4.9
68,929
5.2
81,359
5.8
95,576
7.3
81,605
5.7
94,412
7.1
82,729
5.9
95,316
Equity
147,165
10.3
142,111
10.7
97,598
6.9
93,088
7.2
Warrants
817
0.1
100.0
(1)
Includes unitranche investments, which account for 50.4% and 51.7% of the Company's portfolio on a fair value and cost basis as of June 30, 2026, respectively. Includes unitranche investments, which account for 48.3% and 49.3% of the Company's portfolio on a fair value and cost basis as of December 31, 2025, respectively.
The following table shows portfolio composition by geographic region at fair value and cost and as a percentage of total investments. The geographic composition is determined by the location of the corporate headquarters of the portfolio company, which may not be indicative of the primary source of the portfolio company’s business.
United States
Midwest
161,809
11.3
162,362
12.3
114,163
8.1
114,396
8.8
Southeast
437,946
30.6
387,245
29.1
429,895
30.7
379,889
29.3
Northeast
296,270
20.7
263,070
19.9
296,557
21.1
262,718
20.2
West
218,767
15.3
213,090
16.1
230,438
16.4
232,829
17.9
Southwest
302,005
21.0
282,971
21.4
317,398
22.6
293,590
Canada
1.1
1.2
The following table shows portfolio composition by type and by geographic region at fair value as a percentage of net assets.
By Type
By Geographic Region
153.5
137.4
9.6
9.3
21.9
11.0
12.7
59.3
52.2
19.2
40.1
35.5
29.6
28.7
194.0
178.6
40.9
38.1
2.2
As of June 30, 2026 and December 31, 2025, the Company had no portfolio company investments that represented more than 10% of the total investment portfolio on a fair value or cost basis. As of June 30, 2026 and December 31, 2025, the Company had no investments that exceeded 5% of total assets.
As of June 30, 2026 and December 31, 2025, the Company had debt investments in one portfolio company and two portfolio companies, respectively, on non-accrual status.
Portfolio Company
Value
1,684
27,148
(1) The Company exited its debt investment in such portfolio company and did not hold such investment as of June 30, 2026.
Consolidated Schedule of Investments In and Advances To Affiliates
The table below represents the fair value of control and affiliate investments as of December 31, 2025 and any additions and reductions made to such investments during the six months ended June 30, 2026, the ending fair value as of June 30, 2026, and the total investment income earned on such investments during the period.
Six Months Ended June 30, 2026
Portfolio Company (1)
June 30, 2026 Principal Amount - Debt Investments
December 31, 2025Fair Value
Gross Additions (2)
Gross Reductions (3)
June 30, 2026 Fair Value
Net Realized Gains (Losses) (4)
Net Change in Unrealized Appreciation (Depreciation)
Interest Income
Payment-in-kind Interest Income
Dividend Income
Fee Income
Control Investments
US GreenFiber, LLC
120
Affiliate Investments
(314
(315
531
81
(159
483
Medsurant Holdings, LLC
(1,497
(307
722
423
(22
403
474
1,805
1,786
1,662
2,187
(1
(116
52,718
8,423
(2,109
30
The table below represents the fair value of control and affiliate investments as of December 31, 2024 and any additions and reductions made to such investments during the year ended December 31, 2025, including the total investment income earned on such investments during the period.
Year Ended December 31, 2025
December 31, 2025 Principal Amount - Debt Investments
December 31, 2024Fair Value
December 31, 2025 Fair Value
5,223
(5,223
5,222
24,387
2,100
1,071
8,306
125
(1,999
108
1,041
9,863
10,963
(20,518
(6,982
867
39,923
1,072
522
9,766
(67
54
14,921
17,838
(1,562
2,877
2,453
690
4,624
(727
(728
52,898
102,024
41,864
(24,873
(1,538
4,619
1,555
909
The investment type, industry, ownership detail for equity investments, interest rate and maturity date for debt investments, and if the investment is income producing is disclosed in the consolidated schedule of investments.
(2)
Gross additions include increases in the cost basis of investments resulting from new portfolio investments, follow-on investments, accrued PIK interest and PIK dividend income, accretion of OID and origination fees, and net unrealized appreciation recognized during the period. Gross additions also include transfers of portfolio companies into the control or affiliate classification during the period, as applicable.
(3)
Gross reductions include decreases in the cost basis of investments resulting from principal repayments or sales and net unrealized (depreciation) recognized during the period. Gross reductions also include transfers of portfolio companies out of the control or affiliate classification during the period, as applicable.
(4)
The schedule does not reflect realized gains or losses on escrow receivables for investments which were previously exited and were not held during the period presented. Gains and losses on escrow receivables are classified in the consolidated statements of operations according to the control classification at the time the investment was exited. Escrow receivables are presented in prepaid expenses and other assets on the consolidated statements of assets and liabilities.
Note 4. Fair Value Measurements
Investments
The Board has established and documented processes and methodologies for determining the fair values of portfolio company investments on a recurring basis in accordance with ASC Topic 820 and consistent with the requirements of the 1940 Act. Fair value is the price, determined at the measurement date, that would be received in the sale of an asset or paid to transfer a liability in an orderly transaction between market participants. Where available, fair value is based on observable market prices or parameters, or derived from such prices or parameters. Where observable prices or inputs are not available or reliable, valuation techniques described below are applied. Under ASC Topic 820, portfolio investments recorded at fair value in the consolidated financial statements are classified within the fair value hierarchy based upon the level of judgment associated with the inputs used to measure their value, as defined below:
Level 1 — Inputs are unadjusted, quoted prices in active markets for identical assets as of the measurement date.
Level 2 — Inputs include quoted prices for similar assets in active markets, or that are quoted prices for identical or similar assets in markets that are not active and inputs that are observable, either directly or indirectly, for substantially the full term, if applicable, of the investment.
Level 3 — Inputs include those that are both unobservable and significant to the overall fair value measurement.
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An investment’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The Company’s investment portfolio is comprised entirely of debt and equity securities of privately held companies for which quoted prices falling within the categories of Level 1 and Level 2 inputs are not available, with the exception of money market funds, which are valued using Level 1 inputs as of June 30, 2026. Therefore, the Company values such portfolio investments at fair value, as determined in good faith by the Board, using Level 3 inputs with the exception of money market funds that were valued using Level 1 inputs as of June 30, 2026. The degree of judgment exercised by the Board in determining fair value is greatest for investments classified as Level 3 inputs. Due to the inherent uncertainty of determining the fair values of investments that do not have readily available market quotations, the Board’s estimate of fair values may differ significantly from the values that would have been used had a ready market for the securities existed, and those differences may be material. In addition, changes in the market environment, portfolio company performance and other events that may occur over the lives of the investments may cause the amounts ultimately realized on these investments to be materially different than the valuations currently assigned.
With respect to investments for which market quotations are not readily available, the Board undertakes a multi-step valuation process each quarter, as described below:
In making the good faith determination of the value of portfolio investments, the Board starts with the cost basis of the security. The transaction price is typically the best estimate of fair value at inception. When evidence supports a subsequent change to the carrying value from the original transaction price, adjustments are made to reflect the expected exit values.
The Board consulted with the independent third-party valuation firm(s) in arriving at our determination of fair value for 22 and 21 of our portfolio company investments representing 26.4% and 26.7% of the total portfolio investments at fair value (exclusive of new portfolio company investments made during the three months ended June 30, 2026 and December 31, 2025, respectively) as of June 30, 2026 and December 31, 2025, respectively.
Consistent with the policies and methodologies adopted by the Board, the Company performs detailed valuations of its debt and equity investments, including an analysis on the Company’s unfunded debt investment commitments, using both the market and income approaches as appropriate. Under the market approach, the Company typically uses the enterprise value methodology to determine the fair value of an investment. There is no one methodology to estimate enterprise value and, in fact, for any one portfolio company, enterprise value is generally best expressed as a range of values, from which the Company derives a single estimate of enterprise value. Under the income approach, the Company typically prepares and analyzes discounted cash flow models to estimate the present value of future cash flows of either an individual debt investment or of the underlying portfolio company itself.
The Company evaluates investments in portfolio companies using the most recent portfolio company financial statements and forecasts. The Company also consults with the portfolio company’s senior management to obtain further updates on the portfolio company’s performance, including information such as industry trends, new product development and other operational issues.
32
For the Company’s debt investments, the primary valuation technique used to estimate the fair value is the discounted cash flow method. However, if there is deterioration in credit quality or a debt investment is in workout status, the Company may consider other methods in determining the fair value, including the value attributable to the debt investment from the enterprise value of the portfolio company or the proceeds that would be received in a liquidation analysis. The Company’s discounted cash flow models estimate a range of fair values by applying an appropriate discount rate to the future cash flow streams of its debt investments, based on future interest and principal payments as set forth in the associated debt investment agreements. The Company prepares a weighted average cost of capital for use in the discounted cash flow model for each investment, based on factors including, but not limited to: current pricing and credit metrics for similar proposed or executed investment transactions of private companies; the portfolio company’s historical financial results and outlook; and the portfolio company’s current leverage and credit quality as compared to leverage and credit quality as of the date the investment was made. The Company may also consider the following factors when determining the fair value of debt investments: the portfolio company’s ability to make future scheduled payments; prepayment penalties and other fees; estimated remaining life; the nature and realizable value of any collateral securing such debt investment; and changes in the interest rate environment and the credit markets that generally may affect the price at which similar investments may be made. The Company estimates the remaining life of its debt investments to generally be the legal maturity date of the instrument, as the Company generally intends to hold its debt investments to maturity. However, if the Company has information available to it that the debt investment is expected to be repaid in the near term, it would use an estimated remaining life based on the expected repayment date.
For the Company’s equity investments, including equity securities and warrants, the Company generally uses a market approach, including valuation methodologies consistent with industry practice, to estimate the enterprise value of portfolio companies. Typically, the enterprise value of a private company is based on multiples of EBITDA, net income, revenues, or in limited cases, book value. In estimating the enterprise value of a portfolio company, the Company analyzes various factors consistent with industry practice, including but not limited to original transaction multiples, the portfolio company’s historical and projected financial results, applicable market trading and transaction comparables, applicable market yields and leverage levels, the nature and realizable value of any collateral, the markets in which the portfolio company does business, and comparisons of financial ratios of peer companies that are public.
The Company may also utilize an income approach when estimating the fair value of its equity investments, either as a primary methodology if consistent with industry practice or if the market approach is otherwise not applicable, or as a supporting methodology to corroborate the fair value ranges determined by the market approach. The Company typically prepares and analyzes discounted cash flow models based on projections of the future free cash flows (or earnings) of the portfolio company. The Company considers various factors, including, but not limited to, the portfolio company’s projected financial results, applicable market trading and transaction comparables, applicable market yields and leverage levels, the markets in which the portfolio company does business, and comparisons of financial ratios of peer companies that are public.
The following tables present fair value measurements of investments by major class according to the fair value hierarchy:
Level 1
Level 2
Level 3
Money Market Funds
The Company reviews the fair value hierarchy classifications on a quarterly basis. Reclassifications impacting Level 3 of the fair value hierarchy are reported as transfers in or out of the Level 3 category as of the beginning of the quarter in which the reclassifications occur. There were no transfers among Levels 1, 2, and 3 during the six months ended June 30, 2026 and 2025.
The following tables present a reconciliation of the beginning and ending balances for fair valued investments measured using significant unobservable inputs (Level 3) for the six months ended June 30, 2026 and 2025:
First Lien
Second Lien
Subordinated
Debt
Balance, December 31, 2024
718,120
83,543
142,839
138,371
7,633
1,090,506
Net realized gains (losses) on investments
(11,964
10,527
7,199
Net change in unrealized appreciation (depreciation) on investments
20,138
(6,326
(263
(3,830
(5,134
186,369
-
9,912
210,006
(103,483
(37,089
(16,576
(9,457
(166,605
1,692
1,379
1,628
(1,243
(90
(1,333
1,375
1,598
82
86
Transfers by type
9,645
(9,645
Balance, June 30, 2025
820,731
82,515
107,288
138,404
366
1,149,304
Balance, December 31, 2025
(15,035
8,335
920
(12,916
15,851
(220
544
(238
209,853
6,619
216,662
(86,055
(899
(13,910
(10,444
(920
(112,228
3,827
1,664
1,060
(1,421
(1,425
1,201
Balance, June 30, 2026
Net change in unrealized appreciation/(depreciation) of $(3,596) and $(5,294) for the three and six months ended June 30, 2026 was attributable to Level 3 investments held at June 30, 2026. Net change in unrealized appreciation/(depreciation) of $7,554 and $(131) for the three and six months ended June 30, 2025 was attributable to Level 3 investments held at June 30, 2025.
The following tables summarize the significant unobservable inputs by valuation technique used to determine the fair value of the Company’s Level 3 debt and equity investments as of June 30, 2026 and December 31, 2025. The tables are not intended to be all-inclusive, but instead capture the significant unobservable inputs relevant to the Company’s determination of fair values.
Fair Value at
Valuation
Unobservable
Range
Techniques
Inputs
(weighted average)(1)
Debt investments:
1,084,820
Discounted cash flow
Weighted average cost of capital
7.0% - 27.7% (12.9%)
Enterprise value waterfall
EBITDA multiples
10.0x - 10.0x (10.0x)
12.8% - 22.5% (15.7%)
6.0x - 6.0x (6.0x)
81,408
10.8% - 40.5% (15.2%)
Equity investments:
138,110
3.0x - 18.0x (9.9x)
9,055
Revenue multiples
1.3x - 7.5x (5.0x)
1.6x - 1.6x (1.6x)
(1) Unobservable inputs were weighted by the relative fair value of the instruments.
7.2% - 62.9% (13.7%)
67,453
12.8% - 22.5% (15.5%)
Option pricing
Volatility of credit
70.0% - 70.0% (70.0%)
94,204
11.5% - 20.0% (13.9%)
133,216
1.3x - 22.0x (9.7x)
8,826
0.4x - 8.5x (5.7x)
Probability weighted expected return
Probability
10.0% - 25.0% (11.5%)
3.5x - 3.5x (3.5x)
1.5x - 1.5x (1.5x)
The significant unobservable input used in determining the fair value under the discounted cash flow technique is the weighted average cost of capital of each security. Significant increases (or decreases) in this input would likely result in significantly lower (or higher) fair value estimates.
The significant unobservable inputs used in determining fair value under the enterprise value technique are revenue and EBITDA multiples, as well as asset coverage. Significant increases (or decreases) in these inputs could result in significantly higher (or lower) fair value estimates.
The significant unobservable input used in determining fair value under the option pricing technique (or Black-Scholes model) is volatility. Significant increases (or decreases) in this input could result in significantly higher (or lower) fair value estimates.
The significant unobservable input used in determining fair value under the probability weighted expected return technique is probability. Significant increases (or decreases) in this input could result in significantly higher (or lower) fair value estimates.
Other Financial Assets and Liabilities
ASC Topic 820 requires disclosure of the fair value of financial instruments for which it is practical to estimate such value. The Company believes that the carrying amounts of its other financial instruments such as cash and cash equivalents, interest receivable and accounts payable and other liabilities approximate the fair value of such items due to the short maturity of such instruments. The Company’s borrowings under the SPV Credit Facility (as defined in Note 6), the SBA debentures, and the Notes (as defined in Note 6) are recorded at their respective carrying values.
The following tables summarize the carrying value and fair value of the Company’s debt obligations as of June 30, 2026 and December 31, 2025.
June 30, 2026(5)
December 31, 2025(5)
Carrying Value (1)
SBA debentures (2)
296,000
237,500
SPV Credit Facility borrowings (3)
112,650
83,850
November 2026 Notes (4)
125,000
120,455
March 2030 Notes (4)
200,000
193,614
191,957
June 2029 Notes (4)
116,509
728,650
718,773
646,350
633,762
The following table summarizes the inputs used to value the Company’s debt obligations if measured at fair value as of June 30, 2026 and December 31, 2025.
Valuation Inputs
Note 5. Related Party Transactions
Investment Advisory Agreement: The Company has entered into an Investment Advisory Agreement with the Investment Advisor. Most recently, on June 10, 2026, the Board approved the renewal of the Investment Advisory Agreement for the period from June 20, 2026 through June 20, 2027. Pursuant to the Investment Advisory Agreement and subject to the overall supervision of the Board, the Investment Advisor provides investment advisory services to the Company. For providing these services, the Investment Advisor receives a fee, consisting of two components — a base management fee and an incentive fee.
The base management fee is calculated at an annual rate of 1.75% based on the average value of total assets (other than restricted cash and cash or cash equivalents, but including assets purchased with borrowed amounts) at the end of the two most recently completed calendar quarters. The Board accepted a voluntary, non-contractual, and unconditional waiver from the Investment Advisor to exclude any investments recorded as secured borrowings as defined under GAAP from the base management fee payable effective April 1, 2021. See Note 6. Debt – Secured Borrowings for more information about the secured borrowings. The base management fee is payable quarterly in arrears. The base management fee under the Investment Advisory Agreement for the three and six months ended June 30, 2026 was $6,230 and $12,143, respectively, and $5,106 and $10,028 for the three and six months ended June 30, 2025, respectively. The base management fee waiver for the three and six months ended June 30, 2026 was $50 and $101, respectively, and $59 and $118 for the three and six months ended June 30, 2025, respectively. As of June 30, 2026 and December 31, 2025, the base management fee payable (net of the base management fee waiver) was $6,180 and $5,596, respectively.
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The incentive fee consists of two parts. The first part is calculated and payable quarterly in arrears based on the Company’s pre-incentive fee net investment income for the quarter. Pre-incentive fee net investment income means interest income, dividend income and any other income (including any other fees such as commitment, origination, structuring, diligence and consulting fees or other fees that the Company receives from portfolio companies but excluding fees for providing managerial assistance) accrued during the calendar quarter, minus operating expenses for the quarter (including the base management fee, any expenses payable under the Administration Agreement (defined below) and any interest expense and dividends paid on any outstanding preferred stock, but excluding the incentive fee and excise taxes on realized gains). Pre-incentive fee net investment income includes, in the case of investments with a deferred interest feature (such as market discount, original issue discount, debt instruments with PIK income, preferred stock with PIK dividends and zero-coupon securities), and accrued income the Company has not yet received in cash. The Investment Advisor is not under any obligation to reimburse the Company for any part of the incentive fee it receives that was based on accrued interest that the Company never collects.
Pre-incentive fee net investment income does not include any realized capital gains, taxes associated with such realized capital gains, realized capital losses or unrealized capital appreciation or depreciation. Because of the structure of the incentive fee, it is possible that the Company may pay an incentive fee in a quarter where the Company incurs a loss. For example, if the Company generates pre-incentive fee net investment income in excess of the hurdle rate (as defined below) for a quarter, the Company will pay the applicable incentive fee even if the Company has incurred a loss in that quarter due to a net loss on investments.
Pre-incentive fee net investment income, expressed as a rate of return on the value of the Company’s net assets (defined as total assets less indebtedness and before taking into account any incentive fees payable during the period) at the end of the immediately preceding calendar quarter, is compared to a fixed “hurdle rate” of 2.0% per quarter. The Company may be able to invest funds in debt instruments that provide for a higher return, which would increase the Company’s pre-incentive fee net investment income and make it easier for the Investment Advisor to surpass the fixed hurdle rate and receive an incentive fee based on such net investment income.
The Company pays the Investment Advisor an incentive fee with respect to pre-incentive fee net investment income in each calendar quarter as follows:
The sum of the calculations above equals the income incentive fee. The income incentive fee is appropriately prorated for any period of less than three months and adjusted for any share issuances or repurchases during the calendar quarter. The income incentive fee for the three and six months ended June 30, 2026 was $4,647 and $10,481, respectively, and $4,854 and $9,448 for the three and six months ended June 30, 2025, respectively. As of June 30, 2026 and December 31, 2025, the income incentive fee payable was $4,647 and $4,721, respectively.
37
The second part of the incentive fee is a capital gains incentive fee that is determined and paid in arrears as of the end of each fiscal year (or upon termination of the Investment Advisory Agreement, as of the termination date), and equals 20.0% of the net capital gains as of the end of the fiscal year. In determining the capital gains incentive fee to be paid in cash to the Investment Advisor, the Company calculates the cumulative aggregate realized capital gains and losses since the Company's IPO on June 24, 2011 (realized capital gains and losses include realized gains and losses on investments, net of income tax provision from realized gains on investments, and realized losses on extinguishment of debt, but excluding income tax (provision) benefit from deemed distribution of long term capital gains), and the aggregate unrealized capital depreciation on investments as of the date of the calculation. At the end of the applicable year, the amount of capital gains that serves as the basis for the calculation of the capital gains incentive fee to be paid equals the cumulative aggregate realized capital gains on investments, less cumulative aggregate tax (provision) benefit on realized gains (losses), less cumulative aggregate realized capital losses on investments, less aggregate unrealized capital depreciation on investments, and less cumulative aggregate realized losses on extinguishment of debt. If this number is positive at the end of such year, then the capital gains incentive fee to be paid in cash for such year equals 20.0% of such amount, less the aggregate amount of any capital gains incentive fees paid in all prior years. As of June 30, 2026 and December 31, 2025, none of the capital gains incentive fee was payable in cash because cumulative aggregate realized capital gains and losses on investments exceeded aggregate unrealized capital depreciation on investments plus realized losses on extinguishment of debt. The aggregate amount of capital gains incentive fees paid from the IPO through June 30, 2026 was $17,577.
In addition, the Company accrues, but does not pay in cash, a capital gains incentive fee in connection with any unrealized capital appreciation on investments, as applicable. If, on a cumulative basis, the sum of (i) net realized gains/(losses) on investments, net of income tax (provision) benefit from realized gains on investments plus (ii) net unrealized appreciation/(depreciation) on investments plus (iii) realized losses on extinguishment of debt decreases during a period, the Company will reverse any excess capital gains incentive fee previously accrued such that the amount of capital gains incentive fee accrued is no more than 20.0% of the sum of (i) net realized gains/(losses) on investments, net of income tax (provision) benefit from realized gains on investments plus (ii) net unrealized appreciation/(depreciation) on investments plus (iii) realized losses on extinguishment of debt. The capital gains incentive fee accrued (reversed) during the three and six months ended June 30, 2026 was $254 and $(698), respectively, and $1,331 and $1,618 for the three and six months ended June 30, 2025, respectively. As of June 30, 2026 and December 31, 2025, the accrued capital gains incentive fee payable was $15,716 and $16,414, respectively.
Unless terminated earlier as described below, the Investment Advisory Agreement will continue in effect from year to year if approved annually by the Board or by the affirmative vote of the holders of a majority of the Company’s outstanding voting securities, and, in either case, if also approved by a majority of the directors who are not “interested persons” of the Company, as such term is defined under Section 2(a)(19) of the 1940 Act (the “Independent Directors”). The Investment Advisory Agreement automatically terminates in the event of its assignment, as defined in the 1940 Act, by the Investment Advisor and may be terminated by either party without penalty upon not less than 60 days’ written notice to the other. The Investment Advisory Agreement may be terminated at any time, without the payment of any penalty, upon 60 days' written notice, by the vote of holders of a majority of the outstanding voting securities of the Company or the vote of the Board.
Administration Agreement: The Company also entered into an administration agreement (the “Administration Agreement”) with the Investment Advisor. Most recently, on June 10, 2026, the Board approved the renewal of the Administration Agreement for the period from June 20, 2026 through June 20, 2027. Under the Administration Agreement, the Investment Advisor furnishes the Company with office facilities and equipment, provides clerical, bookkeeping, and record keeping services at such facilities and provides the Company with other administrative services necessary to conduct its day-to-day operations. The Company reimburses the Investment Advisor for the allocable portion of overhead expenses incurred in performing its obligations under the Administration Agreement, including rent and the Company’s allocable portion of the cost of its chief financial officer and chief compliance officer and their respective staffs. Under the Administration Agreement, the Investment Advisor also provides managerial assistance to those portfolio companies on the Company's behalf to those portfolio companies that have accepted the Company's offer to provide such assistance and the Company reimburses the Investment Advisor for fees and expenses incurred with providing such services. In addition, the Company reimburses the Investment Advisor for fees and expenses incurred while performing due diligence on the Company’s prospective portfolio companies, including “dead deal” expenses. Under the Administration Agreement, administrative service expenses for the three and six months ended June 30, 2026 was $778 and $1,549, respectively, and $754 and $1,356 for the three and six months ended June 30, 2025, respectively. As of June 30, 2026 and December 31, 2025, the accrued administrative service expense payable was $630 and $993, respectively.
Note 6. Debt
Revolving Credit Facility: On June 16, 2014, the Company entered into a senior secured revolving credit agreement (as amended from time to time, the “Revolving Credit Agreement” and the senior secured revolving credit facility thereunder, the “Revolving Credit Facility”) with ING Capital LLC (“ING”), as the administrative agent, collateral agent, and lender. The Revolving Credit Facility was secured by certain portfolio investments held by the Company, except for the assets held by the SBIC Funds.
Concurrently with entering into the SPV Credit Agreement (as described below), on October 16, 2025, the Company terminated in full (i) the Revolving Credit Agreement and (ii) the amended and restated guarantee, pledge and security agreement, dated as of April 24, 2019 (as amended from time to time, the “Guarantee and Security Agreement”), by and among the Company, as borrower, the subsidiary guarantors party thereto, ING, as revolving administrative agent, each financing agent and designated indebtedness holder party thereto, and ING, as collateral agent. The Revolving Credit Agreement and the Guarantee and Security Agreement were terminated concurrently with the satisfaction of all obligations and liabilities of the Company to the lending parties thereunder, including, without limitation, payments of principal and interest, other fees, breakage costs and other amounts owing to the lending parties.
The total commitments available under the Revolving Credit Facility was $140.0 million. Under the Revolving Credit Agreement, the Company paid a commitment fee that varied depending on the size of the unused portion of the Revolving Credit Facility: 2.500% to 2.675% per annum on the unused portion of the Revolving Credit Facility at or below 35% of the commitments and 0.50% per annum on any remaining unused portion of the Revolving Credit Facility between the total commitments and the 35% minimum utilization.
SPV Credit Facility: On October 16, 2025, the Company entered into a credit and security agreement (the “SPV Credit Agreement”) relating to a special purpose vehicle credit facility (the “SPV Credit Facility” and together with the Revolving Credit Facility, the “Credit Facilities”) by and among FIC Funding, LLC (the “SPV”), as borrower, the Company, as servicer and equityholder, ING, as administrative agent (the “Administrative Agent”) and lead arranger, Western Alliance Trust Company, N.A., as custodian, collateral agent, and collateral administrator, and the lenders from time to time parties thereto. The SPV Credit Facility is secured primarily by a pledge of 100% of the equity interest in the SPV held by the Company and the SPV’s assets, which consist of certain bank loans or securities. The SPV Credit Facility provides for $175,000 of initial commitments, and has an accordion feature that allows for an increase of the total commitments to up to $250,000, subject to certain conditions (including the consent of the Administrative Agent). On December 22, 2025, the total commitments available under the SPV Credit Facility was increased from $175,000 to $225,000 pursuant to the accordion feature. The SPV Credit Facility has a reinvestment period until October 16, 2029 and matures on October 16, 2030. The advances under the SPV Credit Facility bear interest, subject to the Company’s election, on a per annum basis equal to one-month Term SOFR plus 0.11448% and an applicable margin ranging from 2.500% to 2.675%. The SPV pays a commitment fee that varies depending on the size of the unused portion of the SPV Credit Facility: (1) if the utilized portion of the aggregate commitments as of the close of business on such day is less than 35% of the aggregate commitments (the “Minimum Utilization Amount”), the commitment fee will equal the sum of (a) the then applicable margin multiplied by (i) the Minimum Utilization Amount minus (ii) the aggregate outstanding principal balance of the advances on such day and (b) 0.50% multiplied by 65% of the commitments and (2) if the utilized portion of the aggregate commitments is greater than or equal to the Minimum Utilization Amount, the commitment fee will equal 0.50% multiplied by the unused amount of the commitments.
Amounts available to borrow under the SPV Credit Facility are subject to a minimum borrowing/collateral base that applies an advance rate to certain investments held by the SPV. The SPV is subject to limitations with respect to the investments securing the SPV Credit Facility, including, but not limited to, restrictions on sector concentrations, loan size, payment frequency and status and collateral interests, as well as restrictions on portfolio company leverage, which may also affect the borrowing base and therefore amounts available to borrow. The SPV Credit Facility is secured primarily by a pledge of 100% of the equity interest in the SPV held by the Company and the SPV’s assets, which consist of certain bank loans or securities. As of June 30, 2026 and December 31, 2025, the remaining available borrowing base on the SPV Credit Facility was $74,050 and $102,208, respectively.
The Company and the SPV have made customary representations and warranties and are required to comply with various covenants, reporting requirements and other customary requirements. These covenants are subject to important limitations and exceptions that are described in the documents governing the SPV Credit Facility. As of June 30, 2026 and December 31, 2025, the Company was in compliance in all material respects with the terms of the SPV Credit Agreement.
SBA debentures: The SBIC Funds use debenture leverage provided through the SBA to fund a portion of its investment purchases.
Under the SBA debenture program, the SBA commits to purchase debentures issued by SBICs; such debentures have 10-year terms with the entire principal balance due at maturity and are guaranteed by the SBA. Interest on SBA debentures is payable semi-annually on March 1 and September 1. As of June 30, 2026 and December 31, 2025, approved and unused SBA debenture commitments were $18,500 and $84,000, respectively. The SBA may limit the amount that may be drawn each year under any SBA debenture commitments, and each issuance of leverage is conditioned on such SBIC Fund’s full compliance, as determined by the SBA, with the terms and conditions under SBA regulations.
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As of June 30, 2026 and December 31, 2025, the Company’s issued and outstanding SBA debentures mature as follows:
Pooling
Fixed
Date (1)
Date
Interest Rate
9/25/2019
9/1/2029
2.377
7,500
3/25/2020
3/1/2030
2.172
9/22/2021
9/1/2031
1.398
11,500
3/23/2022
3/1/2032
3.209
43,000
9/21/2022
9/1/2032
4.533
17,500
3/22/2023
3/1/2033
5.439
4,000
5.341
3,000
5,000
9/1/2033
5.861
5.735
3/20/2024
3/1/2034
5.082
2,000
3/26/2025
3/1/2035
5.310
19,500
9/25/2025
9/1/2035
4.879
3/25/2026 (²)
3/1/2036
4.973
3,500
3/25/2026 (³)
13,000
3/25/2026 (⁴)
30,000
3/25/2026
(5)
16,500
Total outstanding SBA debentures
The SBA has quarterly scheduled pooling dates for debentures (in each of March, June, September, and December). Certain debentures funded during the reporting periods may not be pooled until the subsequent pooling date.
The Company issued SBA debentures which did not pool until March 2026. Prior to the pooling date, the debentures bore interest at a fixed interim interest rate of 4.74%.
The Company issued SBA debentures which did not pool until March 2026. Prior to the pooling date, the debentures bore interest at a fixed interim interest rate of 4.73%.
The Company issued SBA debentures which did not pool until March 2026. Prior to the pooling date, the debentures bore interest at a fixed interim interest rate of 4.55%.
The Company issued SBA debentures which will pool in September 2026. Until the pooling date, the debentures bear interest at fixed interim interest rates ranging from 4.59% to 4.67%.
Notes: The term “Notes” refers to collectively to the January 2026 Notes, the November 2026 Notes, the March 2030 Notes, and the June 2029 Notes. The Notes are the Company’s direct unsecured obligations, rank pari passu with the Company’s other outstanding and future unsecured unsubordinated indebtedness and are effectively or structurally subordinated to all of the Company’s existing and future secured indebtedness, including borrowings under the SPV Credit Facility and the SBA debentures.
On December 23, 2020, the Company closed the offering of $125,000 in aggregate principal amount of its 4.75% notes due 2026 (the “January 2026 Notes”). The total net proceeds to the Company from the January 2026 Notes, based on a public offering price of 100.00% of par, after deducting underwriting discounts of $2,500 and offering expenses of $366, were $122,134. The maturity date of the January 2026 Notes was January 31, 2026 and the January 2026 Notes bore interest at a rate of 4.75%. On May 21, 2025, the Company redeemed $25,000 of the $125,000 aggregate principal amount on the January 2026 Notes, resulting in a
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realized loss on extinguishment of debt of $75. On November 3, 2025, the Company fully redeemed the remaining $100,000 in aggregate principal amount of the January 2026 Notes, resulting in a realized loss on extinguishment of debt of $112.
On October 8, 2021, the Company closed the offering of $125,000 in aggregate principal amount of its 3.50% notes due 2026 (the “November 2026 Notes”). The total net proceeds to the Company from the November 2026 Notes, based on a public offering price of 99.996% of par, after deducting underwriting discounts of $2,500 and offering expenses of $318, were $122,177. The maturity date of the November 2026 Notes was November 15, 2026 and the November 2026 Notes bore interest at a rate of 3.50%. On June 29, 2026, the Company fully redeemed the $125,000 in aggregate principal amount of the November 2026 Notes, resulting in a realized loss on extinguishment of debt of $194.
On March 19, 2025, the Company closed the offering of $100,000 in aggregate principal amount of its 6.75% notes due 2030 (the “Existing March 2030 Notes”). The total net proceeds to the Company from the Existing March 2030 Notes, based on a public offering price of 99.29954% of par, after deducting underwriting discounts of $2,000 and offering expenses of $354, were $96,946. On October 3, 2025, the Company issued an additional $100,000 in aggregate principal amount of the 6.75% notes due 2030 (the “Additional March 2030 Notes” and together with the Existing March 2030 Notes, the “March 2030 Notes”). The total net proceeds to us from the Additional March 2030 Notes, based on a public offering price of 100.705% of par, after deducting underwriting discounts of $1,500 and offering expenses of $329, was $98,876. The Additional March 2030 Notes are treated as a single series with the Existing March 2030 Notes under the indenture and have the same terms as the Initial March 2030 Notes (except the issue date, the offering price and the initial interest payment date). Upon issuance of the Additional March 2030 Notes, the outstanding aggregate principal amount of the March 2030 Notes was $200,000. The March 2030 Notes will mature on March 19, 2030 and bear interest at a rate of 6.75%. The March 2030 Notes may be redeemed in whole or in part at any time or from time to time at the Company’s option subject to a make whole provision if redeemed before September 19, 2029 (the date falling six months prior to maturity) and at par thereafter. Interest on the March 2030 Notes is payable on March 19 and September 19 of each year. The Company does not intend to list the March 2030 Notes on any securities exchange or automated dealer quotation system.
On May 29, 2026, the Company closed the private placement of $120,000 in aggregate principal amount of its 6.625% senior unsecured notes due 2029 (the “June 2029 Notes”), in reliance on Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”). The total net proceeds to the Company from the June 2029 Notes, based on an issue price of 99.45% of par, after deducting the placement agent fee of $1,500 and estimated offering expenses of $267 were approximately $117,573. The June 2029 Notes will mature on June 1, 2029 and bear interest at a rate of 6.625%. Interest on the June 2029 Notes is payable on June 1 and December 1 of each year, beginning December 1, 2026. The June 2029 Notes may be redeemed in whole or in part at any time or from time to time at the Company’s option subject to a make whole provision if redeemed before March 1, 2029 (the date falling three months prior to maturity) and at par thereafter. In connection with the issuance and sale of the June 2029 Notes, the Company entered into a registration rights agreement, dated as of May 29, 2026 (the “Registration Rights Agreement”), with the institutional purchasers (the “Purchasers”). Pursuant to the Registration Rights Agreement, the Company is obligated to file with the SEC a registration statement with respect to an offer to exchange the June 2029 Notes for a new issue of debt securities registered under the Securities Act with terms substantially identical to those of the June 2029 Notes (except for provisions relating to transfer restrictions and payment of additional interest) and to use its commercially reasonable efforts to consummate such exchange offer on the earliest practicable date after the registration statement has been declared effective but in no event later than 365 days after the initial issuance of the June 2029 Notes. If the Company fails to satisfy its registration obligations under the Registration Rights Agreement, the Company will be required to pay additional interest to the holder of the June 2029 Notes. The Company does not intend to list the June 2029 Notes on any securities exchange or automated dealer quotation system.
Secured Borrowing
As of June 30, 2026 and December 31, 2025, the carrying value of secured borrowings totaled $11,149 and $12,000, respectively, and the fair value of the associated loans included in investments was $11,131 and $11,995, respectively. These secured borrowings were created as a result of our completion of partial loan sales of certain unitranche loan assets that did not meet the definition of a “participating interest” as defined in ASC 860 (see Note 2. Significant Accounting Policies - Partial loan and equity sales for more information). As a result, sale treatment was not permitted and these partial loan sales were treated as secured borrowings. The weighted average interest rate on our secured borrowings was approximately 7.8% and 7.9% as of June 30, 2026, and December 31, 2025, respectively.
Senior Securities
As of June 30, 2026 and December 31, 2025, the aggregate amount outstanding of the senior securities (including secured borrowings) issued by the Company was $443,799 and $420,850, respectively, for which our asset coverage was 266.4% and 276.3%, respectively. The SBA debentures are excluded from the definition “senior securities” in the asset coverage requirement applicable to the Company under the 1940 Act pursuant to exemptive relief granted to us by the SEC on June 30, 2014. The asset coverage ratio
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for a class of senior securities representing indebtedness is calculated as the Company’s consolidated total assets, less all liabilities and indebtedness not represented by senior securities, divided by total senior securities representing indebtedness.
Interest and Financing Expenses
Interest and fees related to the Company’s debt for the three and six months ended June 30, 2026 and 2025 which are included in interest and financing expenses on the consolidated statements of operations, were as follows:
Three Months Ended June 30, 2026
SPV
SBA
Credit
Secured
debentures
Facility
Borrowings
Notes
Stated interest expense
2,997
1,681
248
5,185
10,111
168
425
846
Total interest and financing expenses
3,250
1,849
5,610
Three Months Ended June 30, 2025
Revolving
2,050
533
4,150
7,045
201
99
424
724
2,251
632
4,574
SBA debentures
Credit Facility
Secured Borrowings
5,663
3,309
507
9,654
19,133
490
334
775
6,153
3,643
10,429
Weighted average stated interest rate, period end
4.463
6.386
7.838
6.703
5.776
Effective interest rate (1)
4.824
6.687
7.230
6.194
Unused commitment fee rate, period end
N/A
0.500
Six Months Ended June 30, 2025
3,991
1,655
629
6,953
13,228
396
721
4,387
1,852
7,674
4.408
8.491
4.885
4.795
4.825
5.386
5.264
1.261
(1) The effective interest rate is equal to the weighted average stated interest rate plus the amortization of deferred financing costs.
Realized Losses on Extinguishment of Debt
During the three and six months ended June 30, 2026, the Company prepaid zero and $7,000 of SBA debentures, which were scheduled to mature in 2033. During the three and six months ended June 30, 2026, the Company fully redeemed $125,000 in aggregate principal amount of the November 2026 Notes. During the three and six months ended June 30, 2025, the Company prepaid zero and $12,500 of SBA debentures, which were scheduled to mature on dates ranging from 2032 to 2033. As a result of the prepayments of the SBA debentures and the full redemption of the November 2026 Notes, the Company recognized realized losses on extinguishment of debt equal to the write-off of the related unamortized deferred financing costs of $194 and $311 during the three and six months ended June 30, 2026, and $75 and $326 during the three and six months ended June 30, 2025, respectively.
Deferred Financing Costs
Deferred financing costs are amortized into interest and financing expenses on the consolidated statements of operations, using the effective interest method, over the term of the respective financing instrument. Deferred financing costs related to the SBA debentures, the SPV Credit Facility, and the Notes as of June 30, 2026 and December 31, 2025 were as follows:
SBA debenture commitment fees
SBA debenture leverage fees
8,071
6,477
SPV Credit Facility upfront fees
3,349
3,342
Notes underwriting discounts
5,660
8,505
Notes debt issuance costs
945
1,361
Total deferred financing costs
11,571
6,605
21,525
9,977
9,866
23,185
Less: accumulated amortization
(3,641
(454
(1,038
(5,133
(3,034
(119
(5,757
(8,910
Unamortized deferred financing costs
7,930
2,895
5,567
16,392
6,943
3,223
4,109
14,275
Unamortized deferred financing costs are presented as a direct offset to the SBA debentures, the SPV Credit Facility and the Notes liabilities on the consolidated statements of assets and liabilities. The following table summarizes the outstanding debt net of unamortized deferred financing costs as of June 30, 2026 and December 31, 2025:
June 30, 2026(1)
December 31, 2025(1)
Outstanding debt
320,000
325,000
Less: unamortized deferred financing costs
(7,930
(2,895
(5,567
(16,392
(6,943
(3,223
(4,109
(14,275
Debt, net of deferred financing costs
712,258
632,075
As of June 30, 2026, the Company’s debt liabilities are scheduled to mature as follows (1):
Year
Debentures
Facility (2)
2027
2028
2029
127,505
2030
318,650
2031
Thereafter
271,000
739,799
The table above presents scheduled maturities of the Company’s outstanding debt liabilities as of a point in time pursuant to the terms of those instruments. The timing of actual repayments of outstanding debt liabilities may not ultimately correspond with the scheduled maturity dates depending on the terms of the underlying instruments and the potential for earlier prepayments.
The SPV Credit Facility matures on October 16, 2030.
Note 7. Commitments and Contingencies
Commitments: The Company had outstanding commitments to portfolio companies to fund various undrawn revolving loans, other debt investments and capital commitments totaling $36,918 and $37,181 as of June 30, 2026 and December 31, 2025, respectively. Such outstanding commitments are summarized in the following table:
Unfunded
Portfolio Company - Investment
Commitment
Acendre Midco, Inc. - Revolving Loan
Acorn VMS Holdco, LP (dba Oakline Holdings) - Revolving Loan
Ad Info Parent, Inc. (dba MediaRadar) - Revolving Loan
1,442
1,195
Air Burners, Inc. - Common Equity
200
Axis Medical Technologies LLC (dba MoveMedical) - Revolving Loan
BPCP Dcom, Inc. - First Lien Debt
2,250
Bobcat of Connecticut, LLC - Common Equity
184
Detechtion Holdings, LLC - First Lien Debt
Detechtion Holdings, LLC - Revolving Loan
Enterprise Asset Management FM Purchaser, Inc. (dba MCIM) - First Lien Debt
Fishbowl Solutions, LLC - Revolving Loan
GMP HVAC, LLC (dba McGee Heating & Air, LLC) - Delayed Draw Term Loan
3,591
3,298
KG Lawn Care, Inc. (dba King Green) - First Lien Debt
2,500
Laboratory Testing, LLC - Revolving Loan
3,427
Mayesh Wholesale Florist, LLC - First Lien Debt
NWS Technologies, LLC - First Lien Debt
673
1,140
PayEntry Financial Services, Inc. (dba Payentry) - Second Lien (DDTL B)
1,563
PIPCO, LLC - Revolving Loan
Pronto Plumbing & Drain, Inc. - Revolving Loan
Tedia Company, LLC - Revolving Loan
1,750
Thrust Flight LLC - First Lien Debt
1,818
True Environmental Inc. - First Lien Debt
3,375
VMS MSO, LLC (dba Vytal Health Partners) - Revolving Loan
W50 Holdings, LLC - Preferred Equity
Waterworks Solutions Acquisition, Inc. (dba CITCO Water) - First Lien Debt
2,450
46,077
36,918
43,211
37,181
Additional detail for each of the commitments above is provided in the Company’s consolidated schedules of investments. As of June 30, 2026 and December 31, 2025, the Company had sufficient liquidity coverage to satisfy these unfunded commitments. Cash and cash equivalents were $37,599 and $69,995 and available borrowings, subject to borrowing base restrictions, under the SPV Credit Facility were $112,350 and $141,150 as of June 30, 2026 and December 31, 2025, respectively.
The commitments are generally subject to the borrowers meeting certain criteria such as compliance with financial and non-financial covenants, which may limit such borrower's ability to draw on a revolving loan or delayed draw loan. Since commitments may expire without being drawn upon, the total commitment amount does not necessarily represent future cash requirements.
Indemnifications: In the normal course of business, the Company enters into contracts and agreements that contain a variety of representations and warranties that provide indemnifications under certain circumstances. In addition, in connection with the disposition of an investment in a portfolio company, the Company may be required to make representations about the business and financial affairs of such portfolio company typical of those made in connection with the sale of a business. The Company may also be required to indemnify the purchasers of such investment to the extent that any such representations are inaccurate. The Company’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Company that have not yet occurred. The Company expects the risk of future obligation under these indemnifications to be remote.
Legal proceedings: In the normal course of business, the Company may be subject to legal and regulatory proceedings that are generally incidental to its ongoing operations. While the outcome of any such legal proceedings cannot be predicted with certainty, the Company does not believe any such legal proceedings will have a material adverse effect on the Company’s consolidated financial statements.
Note 8. Common Stock
Public Offerings of Common Stock
The following table summarizes the cumulative total shares issued, net proceeds received, and weighted average offering price in public offerings of the Company’s common stock since the IPO in June 2011, except for the issuances under the ATM Program as described further below.
Period
Cumulative Number of Shares
Cumulative Gross Proceeds
Cumulative Underwriting Fees and Commissions and Offering Costs (1)
Weighted Average Offering Price
Cumulative since IPO
14,388,414
236,597
16.44
(1) Fidus Investment Advisors, LLC agreed to bear a cumulative of $1,925 of underwriting fees and commissions and offering costs associated with these offerings (such amounts are not included in the number reported above). All such payments made by Fidus Investment Advisors, LLC are not subject to reimbursement by the Company.
Equity ATM Program
On November 10, 2022, the Company established the at-the-market program (the “ATM Program”), pursuant to which the Company may offer and sell, from time to time through Raymond James & Associates, Inc. and B. Riley Securities, Inc., each as sales agents, shares of the Company’s common stock having an aggregate offering price of up to $50,000. On August 11, 2023, the Company increased the maximum amount of shares to be sold through the ATM Program to $150,000 from $50,000. On February 29, 2024, the Company increased the maximum amount of shares to be sold through the ATM Program to $300,000 from $150,000. On March 2, 2026, the Company increased the maximum amount of shares to be sold through the ATM Program to $400,000 from $300,000. The gross proceeds raised, the related sales agent commissions and the offering expenses, the net proceeds raised, and the average price at which shares were issued under the ATM Program for the six months ended June 30, 2026 and 2025 are as follows:
Average
Underwriting
Offering
Gross
Fees and
Net
Shares
Price
Proceeds
Commissions
Proceeds (1)
January 1, 2025 through March 31, 2025
20.58
20,987
315
20,672
April 1, 2025 through June 30, 2025
20.34
7,660
115
7,545
1,396,437
20.51
28,647
430
28,217
January 1, 2026 through March 31, 2026
April 1, 2026 through June 30, 2026
(1) Net proceeds exclude amortization of deferred equity financing costs.
Cumulative to June 30, 2026, the Company has sold 13,300,342 shares of common stock under the ATM Program at a weighted-average price of $19.94, raising $265,226 of gross proceeds. Net proceeds were $261,838 after commissions to the sales agents on shares sold. As of June 30, 2026, the Company had $134,774 available under the ATM Program.
Stock Repurchase Program
As described in Note 2. Significant Accounting Policies, the Company has a Stock Repurchase Program under which the Company may acquire up to $5,000 of its outstanding common stock. The Company did not make any repurchases of common stock during the three and six months ended June 30, 2026 and 2025.
DRIP Program
The Company did not issue any shares of common stock under the DRIP during the three and six months ended June 30, 2026. The Company issued 32,566 and 68,811 shares of common stock under the DRIP during the three and six months ended June 30, 2025, respectively. Refer to Note 9. Dividends and Distributions for additional information regarding the issuance of shares under the DRIP.
The Company had 37,954,364 and 37,954,364 shares of common stock outstanding as of June 30, 2026 and December 31, 2025, respectively.
Note 9. Dividends and Distributions
The Company’s dividends and distributions are recorded on the record date. The following table summarizes the dividends paid during the last two fiscal years and for the six months ended June 30, 2026.
DRIP
Record
Payment
Cash
Share
Declared
Per Share
Distribution
Issue Price
Year Ended December 31, 2024:
2/13/2024
3/27/2024
0.43
13,513
2/13/2024 (1)
0.22
6,914
4/29/2024
6/19/2024
6/26/2024
14,240
13,623
617
31,889
19.36
4/29/2024 (1)
0.16
5,299
5,069
230
11,866
7/29/2024
9/19/2024
9/26/2024
14,567
14,002
565
28,981
19.50
7/29/2024 (1)
0.14
4,743
4,560
183
10/28/2024
12/17/2024
14,583
10/28/2024 (1)
0.18
6,105
2.42
79,964
78,369
1,595
82,172
Year Ended December 31, 2025:
2/18/2025
3/20/2025
14,935
14,377
28,862
19.33
2/18/2025 (1)
0.11
3,820
3,677
143
7,383
5/5/2025
6/13/2025
6/25/2025
15,200
14,698
502
25,932
19.39
5/5/2025 (1)
3,888
3,760
128
6,634
8/4/2025
9/18/2025
15,587
15,073
514
26,255
19.57
8/4/2025 (1)
5,074
4,907
167
8,548
11/3/2025
12/29/2025
16,320
11/3/2025 (1)
0.07
2,657
2.15
77,481
75,469
2,012
103,614
Six Months Ended June 30, 2026:
2/17/2026
3/20/2026
3/30/2026
2/17/2026 (1)
0.09
3,416
6/16/2026
6/29/2026
5/4/2026 (1)
0.19
7,212
43,268
Supplemental dividend
Except for the shares issued pursuant to the DRIP as reflected in the table above, as applicable, during the six months ended June 30, 2026 and the years ended December 31, 2025 and 2024, the Company directed the DRIP plan administrator to repurchase shares on the open market in order to satisfy the DRIP obligation to deliver shares of common stock in lieu of issuing new shares. Accordingly, the Company purchased and reissued shares to satisfy the DRIP obligation as follows:
Purchased
Price Paid
and Reissued
Amount Paid
January 1, 2024 through March 31, 2024
43,050
19.78
April 1, 2024 through June 30, 2024
July 1, 2024 through September 30, 2024
October 1, 2024 through December 31, 2024
29,537
20.99
620
72,587
20.28
1,472
July 1, 2025 through September 30, 2025
October 1, 2025 through December 31, 2025
35,663
19.35
39,796
17.29
688
47,006
18.92
889
86,802
18.17
1,577
46
Note 10. Financial Highlights
The following is a schedule of financial highlights for the six months ended June 30, 2026 and 2025:
Per share data:
Net asset value at beginning of period
Net investment income (1)
Net realized gain (loss) on investments, net of tax (provision) (1)
(0.16
0.12
Net unrealized appreciation (depreciation) on investments (1)
0.08
0.13
Realized losses on extinguishment of debt (1)
(0.01
Total increase from investment operations (1)
Accretive (dilutive) effect of share issuances and repurchases
0.04
Dividends declared to stockholders
(1.14
(1.08
Other (11)
(0.02
Net asset value at end of period
Market value at end of period
19.07
20.20
Shares outstanding at end of period
Weighted average shares outstanding during the period
Net assets at end of period
Average net assets (6)
740,808
675,298
Ratios to average net assets:
Total expenses (2)(4)(10)
12.9
12.0
Net investment income (5)
11.7
10.9
Total return based on market value (3)
3.8
Total return based on net asset value (8)
5.4
6.7
Portfolio turnover ratio (9)
29.2
Supplemental Data:
Weighted average debt outstanding (7)
707,216
529,510
Weighted average debt per share (1)
18.63
15.29
Ratio to average net assets:
Expenses other than incentive fee (4)
8.7
Incentive fee, net of incentive fee waiver (4)(9)
2.6
3.3
Total expenses (4)
47
Total expenses, before base management fee waiver (4)
13.0
12.1
Base management fee waiver (4)(9)
(0.1
%)
Note 11. Subsequent Events
On July 24, 2026, the Company issued an additional $7,500 in SBA debentures, which will bear interest at a fixed interim interest rate of 4.746% until the pooling date in September 2026.
On July 31, 2026, the Company exited its second lien and subordinated debt investments in Virtex Enterprises, LP, which had been on non-accrual status and previously written down. The Company received payment of $204, resulting in an aggregate realized loss of $10,995.
On August 3, 2026, the Board declared a regular quarterly dividend of $0.43 per share and a supplemental dividend of $0.07 per share payable on September 29, 2026, to stockholders of record as of September 15, 2026.
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with Fidus Investment Corporation’s consolidated financial statements and related notes appearing in our annual report on Form 10-K for the year ended December 31, 2025, filed with the SEC on February 26, 2026. The information contained in this section should also be read in conjunction with our unaudited consolidated financial statements and related notes thereto appearing elsewhere in this Quarterly Report on Form 10-Q.
Except as otherwise specified, references to “we,” “us,” “our,” “Fidus” and “FIC” refer to Fidus Investment Corporation and its consolidated subsidiaries.
Forward Looking Statements
This Quarterly Report on Form 10-Q contains forward-looking statements that involve substantial risks and uncertainties. These forward-looking statements are not historical facts, but rather are based on current expectations, estimates and projections about Fidus Investment Corporation, our current and prospective portfolio investments, our industry, our beliefs, and our assumptions. Words such as “anticipates,” “expects,” “intends,” “plans,” “will,” “may,” “continue,” “believes,” “seeks,” “estimates,” “would,” “could,” “should,” “targets,” “projects” and variations of these words and similar expressions are intended to identify forward-looking statements. The forward-looking statements contained in this Quarterly Report on Form 10-Q involve risks and uncertainties, including statements as to:
These statements are not guarantees of future performance and are subject to risks, uncertainties and other factors, some of which are beyond our control and difficult to predict and could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements, including without limitation:
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 debt 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 Quarterly Report on Form 10-Q should not be regarded as a representation by us that our plans and objectives will be achieved. These risks and uncertainties include those described or identified in Item 1.A – Risk Factors contained in our Annual Report on Form 10-K for the year ended December 31, 2025, filed with the SEC on February 26, 2026. You should not place undue reliance on these forward-looking statements, which apply only as of the date of this Quarterly Report on Form 10-Q.
50
Overview
General and Corporate Structure
We provide customized debt and equity financing solutions to lower middle-market companies, which we define as U.S. based companies having revenues between $10.0 million and $150.0 million. Our investment objective is to provide attractive risk-adjusted returns by generating both current income from our debt investments and capital appreciation from our equity related investments. Our investment strategy includes partnering with business owners, management teams and financial sponsors by providing customized financing for ownership transactions, recapitalizations, strategic acquisitions, business expansion and other growth initiatives. We seek to maintain a diversified portfolio of investments in order to help mitigate the potential effects of adverse economic events related to particular companies, regions or industries.
FIC was formed as a Maryland corporation on February 14, 2011. We completed our initial public offering, or IPO, in June 2011. On June 20, 2011, FIC acquired all of the limited partnership interests of Fidus Mezzanine Capital, L.P. (“Fund I”) and membership interests of Fidus Mezzanine Capital GP, LLC, its general partner, resulting in Fund I becoming our wholly-owned subsidiary. Immediately following the acquisition, we and Fund I elected to be treated as business development companies, or BDCs, under the 1940 Act and our investment activities have been managed by Fidus Investment Advisors, LLC, our investment advisor, and supervised by our board of directors, a majority of whom are independent of us. We commenced operations of Fidus Mezzanine Capital II, L.P. (“Fund II”), Fidus Mezzanine Capital III, L.P. (“Fund III”), and Fidus Mezzanine Capital IV, L.P. (“Fund IV” and together with Fund III, the “SBIC Funds”), each a wholly owned subsidiary, on March 29, 2013, April 18, 2018, and November 28, 2023, respectively.
Fund III and Fund IV received their SBIC licenses on March 21, 2019 and September 30, 2024, respectively. We plan to continue to operate Fund III and Fund IV as SBICs, subject to SBA approval, and to utilize the proceeds of the sale of SBA-guaranteed debentures to enhance returns to our stockholders. Fund I and Fund II completed their wind-down plans, can no longer issue additional SBA debentures, and relinquished their SBIC licenses on March 20, 2020 and March 7, 2024, respectively. We have also made, and continue to make, investments directly through FIC. We believe that utilizing FIC and the SBIC Funds as investment vehicles provides us with access to a broader array of investment opportunities.
We have certain wholly-owned subsidiaries (the “Taxable Subsidiaries”), each of which generally holds one or more of our portfolio investments listed on the consolidated schedules of investments, and have elected to be treated as corporations for U.S. federal income tax purposes and are thus subject to U.S. federal income tax imposed at corporate rates. The Taxable Subsidiaries are consolidated for financial reporting purposes, such that our consolidated financial statements reflect our investment in the portfolio company investments owned by the Taxable Subsidiaries. The purpose of the Taxable Subsidiaries is to permit us to hold equity investments in portfolio companies that are classified as partnerships for U.S. federal income tax purposes (such as entities organized as limited liability companies (“LLCs”) or other forms of pass through entities) while complying with the “source-of-income” requirements contained in the RIC tax provisions. The Taxable Subsidiaries are not consolidated with us for U.S. federal income tax purposes, and each Taxable Subsidiary will be subject to U.S. federal income tax on its taxable income. Any such income or expense is reflected in the consolidated statements of operations.
51
We seek to create a diversified investment portfolio that primarily includes debt investments and, to a lesser extent, equity securities. Our investments typically range between $5.0 million to $35.0 million per portfolio company, although this investment size may vary proportionately with the size of our capital base. Our investment objective is to provide attractive risk-adjusted returns by generating both current income from our debt investments and capital appreciation from our equity related investments. We may invest in the equity securities of our portfolio companies, such as preferred stock, common stock, warrants and other equity interests, either directly or in conjunction with our debt investments.
First Lien Debt. We structure some of our investments as senior secured or first lien debt investments. First lien debt investments are secured by a first priority lien on existing and future assets of the borrower and may take the form of term loans or revolving lines of credit. First lien debt is typically senior on a lien basis to other liabilities in the issuer’s capital structure and has the benefit of a first-priority security interest in assets of the issuer. The security interest ranks above the security interest of any second lien lenders in those assets. Our first lien debt may include stand-alone first lien loans, “last out” first lien loans, or “unitranche” loans. Stand-alone first lien loans are traditional first lien loans. All lenders in the facility have equal rights to the collateral that is subject to the first-priority security interest. “Last out” first lien loans have a secondary priority behind super-senior “first out” first lien loans in the collateral securing the loans in certain circumstances. The arrangements for a “last out” first lien loan are set forth in an “agreement among lenders,” which provides lenders with “first out” and “last out” payment streams based on a single lien on the collateral. Since the “first out” lenders generally have priority over the “last out” lenders for receiving payment under certain specified events of default, or upon the occurrence of other triggering events under intercreditor agreements or agreements among lenders, the “last out” lenders bear a greater risk and, in exchange, receive a higher effective interest rate, through arrangements among the lenders, than the “first out” lenders or lenders in stand-alone first lien loans. Agreements among lenders also typically provide greater voting rights to the “last out” lenders than the intercreditor agreements to which second lien lenders often are subject.
Many of our debt investments also include excess cash flow sweep features, whereby principal repayment may be required before maturity if the portfolio company achieves certain defined operating targets. Additionally, our debt investments typically have principal prepayment penalties in the early years of the debt investment. The majority of our debt investments provide for a variable interest rate, generally with a PRIME or SOFR floor.
Second Lien Debt. Some of our debt investments take the form of second lien debt, which includes senior subordinated notes. Second lien debt investments obtain security interests in the assets of the portfolio company as collateral in support of the repayment of such loans. Second lien debt typically is senior on a lien basis to other liabilities in the issuer’s capital structure and has the benefit of a security interest over assets of the issuer, though ranking junior to first lien debt secured by those assets. First lien lenders and second lien lenders typically have separate liens on the collateral, and an intercreditor agreement provides the first lien lenders with priority over the second lien lenders’ liens on the collateral. These loans typically provide for no contractual loan amortization, with all amortization deferred until loan maturity, and may include payment-in-kind (“PIK”) interest, which increases the principal balance over the term and, coupled with the deferred principal payment provision, increases credit risk exposure over the life of the loan.
Subordinated Debt. These investments are typically structured as unsecured, subordinated notes. Structurally, subordinated debt usually ranks subordinate in priority of payment to first lien and second lien debt and may not have the benefit of financial covenants common in first lien and second lien debt. Subordinated debt may rank junior as it relates to proceeds in certain liquidations where it does not have the benefit of a lien in specific collateral held by creditors (typically first lien and/or second lien) who have a perfected security interest in such collateral. However, subordinated debt ranks senior to common and preferred equity in an issuer’s capital structure. These loans typically have relatively higher fixed interest rates (often representing a combination of cash pay and PIK interest) and amortization of principal deferred to maturity. The PIK feature (meaning a feature allowing for the payment of interest in the form of additional principal amount of the loan instead of in cash), which effectively operates as negative amortization of loan principal, coupled with the deferred principal payment provision, increases credit risk exposure over the life of the loan.
Equity Securities. Our equity investments typically consist of either a direct minority equity investment in common or preferred stock or membership/partnership interests of a portfolio company, or we may receive warrants to buy a minority equity interest in a portfolio company in connection with a debt investment. Warrants we receive with our debt investments typically require only a nominal cost to exercise, and thus, as a portfolio company appreciates in value, we may achieve additional investment return from this equity interest. Our equity investments are typically not control-oriented investments, and in many cases, we acquire equity securities as part of a group of private equity investors in which we are not the lead investor. We may structure such equity investments to include provisions protecting our rights as a minority-interest holder, as well as a “put,” or right to sell such securities back to the issuer, upon the occurrence of specified events. In many cases, we may also seek to obtain registration rights in connection with these equity interests, which may include demand and “piggyback” registration rights. Our equity investments typically are made in connection with debt investments to the same portfolio companies.
Revenues: We generate revenue in the form of interest and fee income on debt investments and dividends, if any, on equity investments. Our debt investments, whether in the form of second lien, subordinated or first lien loans, typically have terms of five to seven years and most bear interest at fixed or variable rates. In some instances, we receive payments on our debt investments based on scheduled amortization of the outstanding balances. In addition, we may receive repayments of some of our debt investments prior to their scheduled maturity dates, which may include prepayment penalties. The frequency or volume of these repayments fluctuates significantly from period to period. Our portfolio activity may reflect the proceeds of sales of securities. In some cases, our investments provide for deferred interest payments or PIK interest. The principal amount of debt investments and any accrued but unpaid interest generally become due at the maturity date. In addition, we may generate revenue in the form of commitment, origination, amendment, or structuring fees and fees for providing managerial assistance. Debt investment origination fees, OID and market discount or premium, if any, are capitalized, and we accrete or amortize such amounts into interest income. We record prepayment penalties on debt investments as fee income when earned. Interest and dividend income is recorded on the accrual basis to the extent that we expect to collect such amounts. Interest is accrued daily based on the outstanding principal amount and the contractual terms of the debt investment. Dividend income is recorded as dividends are declared or at the point an obligation exists for the portfolio company to make a distribution, and is generally recognized when received. Distributions of earnings from portfolio companies are evaluated to determine if the distribution is a distribution of earnings or a return of capital. Distributions of earnings are included in dividend income while a return of capital is recorded as a reduction in the cost basis of the investment. Estimates are adjusted as necessary after the relevant tax forms are received from the portfolio company. Debt investments or preferred equity investments (for which we are accruing PIK dividends) are placed on non-accrual status when principal, interest or dividend payments become materially past due, or when there is reasonable doubt that principal, interest or dividends will be collected. Interest and dividend payments received on non-accrual investments may be recognized as interest or dividend income or may be applied to the investment principal balance based on management’s judgment. Non-accrual investments are restored to accrual status when past due principal, interest or dividends are paid and, in management’s judgment, payments are likely to remain current. See “Critical Accounting Policies and Use of Estimates – Revenue Recognition.”
We recognize realized gains or losses on investments based on the difference between the net proceeds from the disposition and the cost basis of the investment, without regard to unrealized gains or losses previously recognized. We record current period changes in fair value of investments that are measured at fair value as a component of the net change in unrealized appreciation (depreciation) on investments in the consolidated statements of operations.
Expenses: All investment professionals of the Investment Advisor and/or its affiliates, when and to the extent engaged in providing investment advisory and management services to us, and the compensation and routine overhead expenses allocable to personnel who provide these services to us, are provided and paid for by the Investment Advisor and not by us. We bear all other out-of-pocket costs and expenses of our operations and transactions, including, without limitation, those relating to:
Portfolio Composition, Investment Activity and Yield
During the six months ended June 30, 2026 and 2025, we invested $216.7 million and $210.0 million, respectively, in debt and equity investments including six and eleven new portfolio companies, respectively. During the six months ended June 30, 2026 and 2025, we received proceeds from sales or repayments, including principal, return of capital dividends and net realized gains (losses), of $112.2 million and $166.6 million, respectively, including an exit of one portfolio company and five portfolio companies, respectively. The following table summarizes purchases of investments and sales and repayments of investments by type for the six months ended June 30, 2026 and 2025 (dollars in millions).
Purchases of Investments
Sales and Repayments of Investments
Six months ended June 30,
209.8
96.8
186.4
88.7
86.1
76.7
103.5
62.1
13.6
6.5
0.9
0.8
0.2
13.9
12.4
37.0
22.2
3.1
9.9
4.7
10.4
16.6
10.0
9.5
216.7
210.0
112.2
166.6
(1) For the six months ended June 30, 2026 and 2025, first lien debt includes unitranche securities, which account for 48.5% and 58.4% of purchases, respectively. For the six months ended June 30, 2026 and 2025, first lien debt includes unitranche securities, which account for 27.7% and 22.6% of repayments, respectively.
As of June 30, 2026, the fair value of our investment portfolio totaled $1.4 billion and consisted of 100 active portfolio companies and eight portfolio companies that have sold their underlying operations. As of June 30, 2026, 61 portfolio companies’ debt investments bore interest at a variable rate, which represented $930.6 million, or 72.4%, of our debt investment portfolio on a fair value basis, and the remainder of our debt investment portfolio was comprised of fixed-rate investments. Overall, the portfolio had net unrealized appreciation of $28.5 million as of June 30, 2026. As of June 30, 2026, our average active portfolio company investment at amortized cost was $14.0 million, which excludes investments in eight portfolio companies that have sold their underlying operations.
As of December 31, 2025, the fair value of our investment portfolio totaled $1.3 billion and consisted of 97 active portfolio companies and six portfolio companies that have sold their underlying operations. As of December 31, 2025, 58 portfolio companies’ debt investments bore interest at a variable rate, which represented $890.1 million, or 75.3%, of our debt investment portfolio on a fair value basis, and the remainder of our debt investment portfolio was comprised of fixed-rate investments. Overall, the portfolio had net unrealized appreciation of $25.5 million as of December 31, 2025. As of December 31, 2025, our average active portfolio company investment at amortized cost was $13.4 million, which excludes investments in six portfolio companies that have sold their underlying operations.
The weighted average yield on debt investments as of June 30, 2026 and December 31, 2025 was 12.5% and 12.6%, respectively. The weighted average yield of our debt investments is not the same as a return on investment for our stockholders but, rather, relates to a portion of our investment portfolio and is calculated before the payment of all of our and our subsidiaries’ fees and expenses. The weighted average yields were computed using the effective interest rates for debt investments at cost as of June 30, 2026 and December 31, 2025, including the accretion of OID and debt investment origination fees, but excluding investments on non-accrual status and investments recorded as a secured borrowing.
The following table shows the portfolio composition by investment type at fair value and cost and as a percentage of total investments (dollars in millions):
1,133.5
1,019.2
1,141.9
1,014.5
70.6
68.9
81.4
95.6
81.6
94.4
82.7
95.3
147.2
142.1
97.6
93.1
1,432.9
1,324.8
1,404.4
1,299.3
(1) Includes unitranche investments, which account for 50.4% and 51.7% of our portfolio on a fair value and cost basis as of June 30, 2026, respectively. Includes unitranche investments, which account for 48.3% and 49.3% of our portfolio on a fair value and cost basis as of December 31, 2025, respectively.
The following table shows portfolio composition by geographic region at fair value and cost and as a percentage of total investments (dollars in millions). The geographic composition is determined by the location of the corporate headquarters of the portfolio company, which may not be indicative of the primary source of the portfolio company’s business.
161.8
162.4
114.2
114.4
437.9
387.2
429.8
379.9
296.3
263.1
296.6
262.7
218.8
213.1
230.4
232.8
302.0
283.0
317.4
293.6
16.0
15.9
The following table shows the detailed industry composition of our portfolio at fair value and cost as a percentage of total investments:
Name
36.3
36.9
38.0
39.0
11.5
12.6
12.5
7.9
6.8
6.4
7.0
6.2
6.6
3.5
5.6
5.5
5.3
3.4
3.6
2.3
3.7
3.9
2.8
2.9
3.0
3.2
2.7
Promotional Products
1.9
2.0
1.8
1.3
1.4
0.7
Transportation Services
0.5
0.6
Portfolio Asset Quality
In addition to various risk management and monitoring tools, the Investment Advisor uses an internally developed investment rating system to characterize and monitor the credit profile and our expected level of returns on each investment in our portfolio. We use a five-level numeric rating scale. The following is a description of the conditions associated with each investment rating:
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We also have observed, and continue to observe, supply chain disruptions, labor and resource shortages, commodity inflation, elements of financial market instability (including elevated interest rates), changes to U.S. tariff and trade policies and uncertainty relating to such changes, an uncertain economic outlook for the United States (which may include a recession), and elements of geopolitical instability (including the ongoing war in Ukraine, U.S. and China relations, and ongoing conflicts in the Middle East). In the event that the U.S. economy enters into a protracted recession, it is possible that the results of certain U.S. middle market companies could experience deterioration. We are closely monitoring the effect of such market volatility may have on our portfolio companies and our investment activities. We also are maintaining close communications with our portfolio companies and have also increased oversight of credits in vulnerable industries to mitigate any decline in loan performance and reduce credit risk.
The following table shows the distribution of our investments on the 1 to 5 investment rating scale at fair value and cost as of June 30, 2026 and December 31, 2025 (dollars in millions):
Investment Rating
82.3
68.6
1.6
1,229.0
85.8
1,145.2
86.5
1,213.5
86.4
1,130.8
87.0
121.2
8.5
109.2
8.2
140.0
118.1
9.1
0.4
21.8
1.7
22.8
Based on our investment rating system, the weighted average rating of our portfolio as of June 30, 2026 and December 31, 2025 was 2.0 and 2.0, respectively, on a fair value basis and 2.1 and 2.2, respectively, on a cost basis.
Non-Accrual
As of June 30, 2026 and December 31, 2025, we had debt investments in one portfolio company and two portfolio companies, respectively, on non-accrual status (dollars in millions).
1.5
11.2
27.1
Discussion and Analysis of Results of Operations
Comparison of three and six months ended June 30, 2026 and 2025
Investment Income
Below is a summary of the changes in total investment income for the three months ended June 30, 2026 as compared to the same period in 2025 (dollars in millions, percent change calculated based on underlying dollar amounts in thousands):
Three Months Ended June 30,
$ Change
% Change (1)(2)
36.5
32.2
4.3
13.3
2.5
1.0
42.1
0.3
36.6
2.1
(1.8
(46.0
(0.3
(29.4
43.5
40.0
(1) NM = Not meaningful
(2) Percent change calculated based on underlying dollar amounts in thousands as presented on the consolidated statements of operations.
For the three months ended June 30, 2026, total investment income was $43.5 million, an increase of $3.5 million or 8.8%, from $40.0 million of total investment income for the three months ended June 30, 2025. As reflected in the table above, the increase is primarily attributable to the following:
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Below is a summary of the changes in total investment income for the six months ended June 30, 2026 as compared to the same period in 2025 (dollars in millions):
70.8
62.5
8.3
13.2
39.4
(0.8
(38.5
6.0
5.0
83.6
91.0
76.5
14.5
19.0
For the six months ended June 30, 2026, total investment income was $91.0 million, an increase of $14.5 million or 19.0%, from the $76.5 million of total investment income for the six months ended June 30, 2025. As reflected in the table above, the increase is primarily attributable to the following:
Expenses
Below is a summary of the changes in total expenses, including income tax provision, for the three months ended June 30, 2026 as compared to the same period in 2025 (dollars in millions, percent change calculated based on underlying dollar amounts in thousands):
7.8
41.0
5.1
22.0
4.6
4.8
(0.2
(4.3
(1.1
(80.9
NM
28.8
21.7
Total expenses, before base management fee waiver
24.8
21.3
16.3
Total expenses, net of base management fee waiver before income tax provision
Total expenses, including income tax provision
16.2
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For the three months ended June 30, 2026, total expenses, including the base management fee waiver and income tax provision, were $24.8 million, an increase of $3.5 million or 16.2%, from the $21.3 million of total expenses, including the base management fee waiver and income tax provision, for the three months ended June 30, 2025. As reflected in the table above, changes across the periods were primarily attributable to the following:
Below is a summary of the changes in total expenses, including income tax provision, for the six months ended June 30, 2026 as compared to the same period in 2025 (dollars in millions):
14.6
6.1
42.6
10.5
Incentive fee - capital gains
(0.7
(2.3
(143.1
14.2
32.5
25.1
47.7
39.7
8.0
20.3
14.4
Total expenses, before income tax provision
47.6
39.5
20.4
39.6
For the six months ended June 30, 2026, total expenses, including the base management fee waiver and income tax provision, were $47.7 million, an increase of $8.1 million or 20.4%, from the $39.6 million of total expenses, including the base management fee waiver and income tax provision, for the six months ended June 30, 2025. As reflected in the table above, changes across periods were primarily attributable to the following:
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Net Investment Income
Net investment income increased by $0.0 million, or 0.3%, to $18.7 million during the three months ended June 30, 2026 as compared to the same period in 2025, as a result of the $3.5 million increase in total investment income, offset by the $3.5 million increase in total expenses, including base management fee waiver and income tax provision.
Net investment income increased by $6.4 million, or 17.6%, to $43.3 million during the six months ended June 30, 2026 as compared to the same period in 2025, as a result of the $14.5 million increase in total investment income, partially offset by the $8.1 million increase in total expenses, including base management fee waiver and income tax provision.
Net Gain (Loss) on Investments
For the three and six months ended June 30, 2026, the total net realized gain/(loss) on investments, before income tax (provision)/benefit, was $6.4 million and $(5.8) million, respectively. Income tax (provision) benefit from realized gains on investments was $(0.3) million and $(0.4) million for the three and six months ended June 30, 2026. We realize a gain/(loss) on our equity investments primarily when we either sell our equity investment or the underlying portfolio company is sold. Realized gains (losses) for the three and six months ended June 30, 2026 are summarized below (dollars in millions):
Period Ended June 30, 2026
Three
Six
Realization Event (1)
Months
Sale of portfolio company
Parital sale of equity investment
Escrow distribution
Exit of portfolio company
Exit of equity investment
(0.9
Exchange of debt security
(14.9
Net realized gain (loss) on investments
(5.8
(0.4
Net realized gain (loss), net of income tax provision, on investments
(6.2
As it relates to realization events, we define an 'exit' of a portfolio company as situations where we have completely exited our position in all of the portfolio company's securities and no longer carry the portfolio company on our schedule of investments. We define a 'sale' of a portfolio company, distinguished from an exit, as situations where the underlying operations of a portfolio company have been sold, but where we retain a residual ownership interest in the legacy entity (we generally distinguish these residual portfolio company investments from 'active' portfolio company investments).
For the three and six months ended June 30, 2025, the total net realized gain/(loss) on investments, before income tax (provision)/benefit, was $(7.6) million and $5.7 million. Income tax (provision) benefit from realized gains on investments was $(0.1) million and $(1.9) million for the three and six months ended June 30, 2025. We realize a gain/(loss) on our equity investments primarily when we either sell our equity investment or the underlying portfolio company is sold. Realized gains (losses) for the three and six months ended June 30, 2025 are summarized below (dollars in millions):
Period Ended June 30, 2025
Healthfuse, LLC
10.1
Micronics Filtration Holdings, Inc. (dba Micronics Engineered Filtration Group, Inc.)
OnePath Systems, LLC
Quantum IR Technologies, LLC
(14.4
(7.6
(1.9
(7.7
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During the three and six months ended June 30, 2026 and 2025, we recorded a net change in unrealized appreciation (depreciation) on investments attributable to the following (dollars in millions):
Unrealized Appreciation (Depreciation)
Exit, sale or restructuring of investments
(4.5
(4.1
Fair value adjustments to debt investments
(1.2
4.1
Fair value adjustments to equity investments
Net change in unrealized appreciation (depreciation)
(4.6
14.3
Net Increase in Net Assets Resulting From Operations
Net increase (decrease) in net assets resulting from operations during the three months ended June 30, 2026 and 2025 was $20.0 million and $25.3 million, respectively, as a result of the events described above.
Net increase (decrease) in net assets resulting from operations during the six months ended June 30, 2026 and 2025 was $39.8 million and $44.9 million, respectively, as a result of the events described above.
Liquidity and Capital Resources
As of June 30, 2026, we had $37.6 million in cash and cash equivalents, $1.7 million in restricted cash, and our net assets totaled $738.5 million. We believe that our current cash and cash equivalents on hand, restricted cash, our SPV Credit Facility, our continued access to SBA-guaranteed debentures, and our anticipated cash flows from investments will provide adequate capital resources with which to operate and finance our investment business and make distributions to our stockholders for at least the next 12 months. We intend to generate additional cash primarily from the future offerings of debt and equity securities (including the ATM Program (as defined below)) and future borrowings, as well as cash flows from operations, including income earned from investments in our portfolio companies. On both a short-term and long-term basis, our primary use of funds will be investments in portfolio companies and cash distributions to our stockholders. During the six months ended June 30, 2026, we repaid $7.0 million of SBA debentures relating to Fund III that would have matured during the period March 1, 2033 through September 1, 2033. Our remaining outstanding SBA debentures begin to mature in 2029 and subsequent years through 2036, which will require repayment on or before the respective maturity dates. In light of current market conditions, we will continually evaluate our overall liquidity position and take proactive steps to maintain that position based on the current circumstances. This “Financial Liquidity and Capital Resources” section should be read in conjunction with the notes of our consolidated financial statements.
Cash Flows
For the six months ended June 30, 2026, we experienced a net decrease in cash, cash equivalents and restricted cash in the amount of $40.4 million. During that period, we made net payments of $74.5 million of cash for operating activities, which included the funding of $216.7 million of investments that was partially offset by proceeds received from sales and repayments of investments of $112.2 million. During the same period, we received gross proceeds from the issuance of the June 2029 Notes of $120.0 million, redeemed $125.0 million in aggregate principal amount of the November 2026 Notes, received proceeds from the issuances of SBA debentures of $65.5 million, repaid SBA debentures relating to Fund III of $7.0 million, received net proceeds of $28.8 million from our SPV Credit Facility, received repayments of $0.9 million on our secured borrowings, paid cash dividends to stockholders of $43.3 million, and made payment of deferred financing costs related to our debt financings of $4.0 million.
Capital Resources
We anticipate that we will continue to fund our investment activities on a long-term basis through a combination of additional debt and equity capital.
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SBA Debentures
Both Fund III and Fund IV are licensed to operate as an SBIC, and have the ability to issue debentures guaranteed by the SBA at favorable interest rates. Under the SBA regulations, an SBIC can have outstanding at any time debentures guaranteed by the SBA in an amount up to twice its regulatory capital. Subject to SBA approval, the SBA regulations currently limit the amount that is available to be borrowed by any SBIC and guaranteed by the SBA to 300.0% of an SBIC’s regulatory capital or $250.0 million, whichever is less. For two or more SBICs under common control, the maximum amount of outstanding SBA debentures cannot exceed $475.0 million, subject to SBA approval. The SBA may limit the amount that may be drawn each year under the SBA debenture commitments, and each issuance of leverage is conditioned on such SBIC Fund’s full compliance, as determined by the SBA, with the terms and conditions under SBA regulations. SBA debentures have fixed interest rates that approximate prevailing 10-year Treasury Note rates plus a spread and have a maturity of ten years with interest payable semi-annually. The principal amount of the SBA debentures is not required to be paid before maturity but may be pre-paid at any time. As of June 30, 2026, Fund III and Fund IV had $139.5 million and $156.5 million in outstanding SBA debentures, respectively. Subject to SBA regulatory requirements and approval of SBA debenture commitments, FMC IV may access up to $93.5 million of additional SBA debentures under the SBIC debenture program. For more information on the SBA debentures, please refer to Note 6. Debt to our consolidated financial statements.
Revolving Credit Facility
On June 16, 2014, we entered into a senior secured revolving credit agreement (as amended from time to time, the "Revolving Credit Agreement" and the senior secured revolving credit facility thereunder, the “Revolving Credit Facility”) with ING Capital LLC (“ING”), as the administrative agent, collateral agent, and lender. The Revolving Credit Facility was secured by certain portfolio investments held by us, except for the assets held by the SBIC Funds.
Concurrently with entering into the SPV Credit Agreement (as described below), on October 16, 2025, we terminated in full (i) the Revolving Credit Agreement and (ii) the amended and restated guarantee, pledge and security agreement, dated as of April 24, 2019 (as amended from time to time, the “Guarantee and Security Agreement”), by and among us, as borrower, the subsidiary guarantors party thereto, ING, as revolving administrative agent, each financing agent and designated indebtedness holder party thereto, and ING, as collateral agent. The Revolving Credit Agreement and the Guarantee and Security Agreement were terminated concurrently with the satisfaction of all our obligations and liabilities to the lending parties thereunder, including, without limitation, payments of principal and interest, other fees, breakage costs and other amounts owing to the lending parties.
The total commitments available under the Revolving Credit Facility were $140.0 million. Under the Revolving Credit Agreement, we paid a commitment fee that varied depending on the size of the unused portion of the Revolving Credit Facility: 2.500% to 2.675% per annum on the unused portion of the Revolving Credit Facility at or below 35% of the commitments and 0.50% per annum on any remaining unused portion of the Revolving Credit Facility between the total commitments and the 35% minimum utilization.
SPV Credit Facility
On October 16, 2025, we entered into a credit and security agreement (the “SPV Credit Agreement”) relating to a special purpose vehicle credit facility (the “SPV Credit Facility”) by and among FIC Funding, LLC (the “SPV”), as borrower, us, as servicer and equityholder, ING, as administrative agent (the “Administrative Agent”) and lead arranger, Western Alliance Trust Company, N.A., as custodian, collateral agent, and collateral administrator, and the lenders from time to time parties thereto. The SPV Credit Facility is secured primarily by a pledge of 100% of the equity interest in the SPV held by the Company and the SPV’s assets, which consist of certain bank loans or securities. The SPV Credit Facility provides for $175.0 million of initial commitments, and has an accordion feature that allows for an increase of the total commitments to up to $250.0 million, subject to certain conditions (including the consent of the Administrative Agent). On December 22, 2025, the total commitments available under the SPV Credit Facility was increased from $175.0 million to $225.0 million pursuant to the accordion feature. The SPV Credit Facility has a reinvestment period until October 16, 2029 and matures on October 16, 2030. The advances under the SPV Credit Facility bear interest, subject to our election, on a per annum basis equal to one-month Term SOFR plus 0.11448% and an applicable margin ranging from 2.500% to 2.675%. The SPV pays a commitment fee that varies depending on the size of the unused portion of the SPV Credit Facility: (1) if the utilized portion of the aggregate commitments as of the close of business on such day is less than 35% of the aggregate commitments (the “Minimum Utilization Amount”), the commitment fee will equal the sum of (a) the then applicable margin multiplied by (i) the Minimum Utilization Amount minus (ii) the aggregate outstanding principal balance of the advances on such day and (b) 0.50% multiplied by 65% of the commitments and (2) if the utilized portion of the aggregate commitments is greater than or equal to the Minimum Utilization Amount, the commitment fee will equal 0.50% multiplied by the unused amount of the commitments.
Amounts available to borrow under the SPV Credit Facility are subject to a minimum borrowing/collateral base that applies an advance rate to certain investments held by the SPV. The SPV is subject to limitations with respect to the investments securing the
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SPV Credit Facility, including, but not limited to, restrictions on sector concentrations, loan size, payment frequency and status and collateral interests, as well as restrictions on portfolio company leverage, which may also affect the borrowing base and therefore amounts available to borrow. The SPV Credit Facility is secured primarily by a pledge of 100% of the equity interest in the SPV held by us and the SPV’s assets, which consist of certain bank loans or securities.
We and the SPV have made customary representations and warranties and we are required to comply with various covenants, reporting requirements and other customary requirements. These covenants are subject to important limitations and exceptions that are described in the documents governing the SPV Credit Facility. As of June 30, 2026, we were in compliance in all material respects with the terms of the SPV Credit Agreement.
The unsecured notes described below are our direct unsecured obligations, rank pari passu with our other outstanding and future unsecured unsubordinated indebtedness and are effectively or structurally subordinated to all of our existing and future secured indebtedness, including borrowings under the SPV Credit Facility and the SBA debentures.
On December 23, 2020, we closed the offering of $125.0 million in aggregate principal amount of our 4.75% notes due 2026, or the “January 2026 Notes”. The total net proceeds to us from the January 2026 Notes, based on a public offering price of 100.00% of par, after deducting underwriting discounts of $2.5 million and offering expenses of $0.4 million, were $122.1 million. The maturity date of the January 2026 Notes was January 31, 2026, and the January 2026 Notes bore interest at a rate of 4.75%. On May 21, 2025, we redeemed $25.0 million of the $125.0 million aggregate principal amount on the January 2026 Notes, resulting in a realized loss on extinguishment of debt of $0.1 million. On November 3, 2025, we fully redeemed the remaining $100.0 million in aggregate principal amount of the January 2026 Notes, resulting in a realized loss on extinguishment of debt of $0.1 million.
On October 8, 2021, we closed the offering of $125.0 million in aggregate principal amount of our 3.50% notes due 2026, or the “November 2026 Notes”. The total net proceeds to us from the November 2026 Notes, based on a public offering price of 99.996% of par, after deducting underwriting discounts of $2.5 million and offering expenses of $0.3 million, were $122.2 million. The maturity date of the November 2026 Notes was November 15, 2026 and the November 2026 Notes bore interest at a rate of 3.50%. On June 29, 2026, we fully redeemed the $125.0 million in aggregate principal amount of the November 2026 Notes, resulting in a realized loss on extinguishment of debt of $0.2 million.
On March 19, 2025, we closed the offering of $100.0 million in aggregate principal amount of our 6.75% notes due 2030, or the “Existing March 2030 Notes”. The total net proceeds to us from the Existing March 2030 Notes, based on a public offering price of 99.29954% of par, after deducting underwriting discounts of $2.0 million and offering expenses of $0.4 million, was $96.9 million. On October 3, 2025, we issued an additional $100.0 million in aggregate principal amount of the 6.75% notes due 2030 (the “Additional March 2030 Notes” and together with the Existing March 2030 Notes, the “March 2030 Notes”). The total net proceeds to us from the Additional March 2030 Notes, based on a public offering price of 100.705% of par, after deducting underwriting discounts of $1.5 million and offering expenses of $0.3 million, was $98.9 million. The Additional March 2030 Notes are treated as a single series with the Existing March 2030 Notes under the indenture and have the same terms as the Initial March 2030 Notes (except the issue date, the offering price and the initial interest payment date). Upon issuance of the Additional March 2030 Notes, the outstanding aggregate principal amount of the March 2030 Notes was $200.0 million. The March 2030 Notes will mature on March 19, 2030 and bear interest at a rate of 6.75%. The March 2030 Notes may be redeemed in whole or in part at any time or from time to time at our option subject to a make whole provision if redeemed before September 19, 2029 (the date falling six months prior to maturity) and at par thereafter. Interest on the March 2030 Notes is payable on March 19 and September 19 of each year. We do not intend to list the March 2030 Notes on any securities exchange or automated dealer quotation system.
On May 29, 2026, we closed the private placement of $120.0 million in aggregate principal amount of our 6.625% senior unsecured notes due 2029, or the “June 2029 Notes”, in reliance on Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”). The total net proceeds to us from the June 2029 Notes, based on an issue price of 99.45% of par, after deducting the placement agent fee of $1.5 million and estimated offering expenses of $0.3 million were approximately $117.6 million. The June 2029 Notes will mature on June 1, 2029 and bear interest at a rate of 6.625%. Interest on the June 2029 Notes is payable on June 1 and December 1 of each year, beginning December 1, 2026. The June 2029 Notes may be redeemed in whole or in part at any time or from time to time at our option subject to a make whole provision if redeemed before March 1, 2029 (the date falling three months prior to maturity) and at par thereafter. In connection with the issuance and sale of the June 2029 Notes, we entered into a registration rights agreement, dated as of May 29, 2026 (the “Registration Rights Agreement”), with the institutional purchasers (the “Purchasers”). Pursuant to the Registration Rights Agreement, we are obligated to file with the SEC a registration statement with respect to an offer to exchange the June 2029 Notes for a new issue of debt securities registered under the Securities Act with terms substantially identical to those of the June 2029 Notes (except for provisions relating to transfer restrictions and payment of additional interest) and to use our commercially reasonable efforts to consummate such exchange offer on the earliest practicable date after the registration statement has been declared effective but in no event later than 365 days after the initial issuance of the June 2029 Notes. If we fail to satisfy our registration obligations under the Registration Rights Agreement, we will be required to pay additional interest to the holder of the June 2029 Notes. We do not intend to list the June 2029 Notes on any securities exchange or automated dealer quotation system.
As of June 30, 2026, the carrying value of secured borrowings totaled $11.1 million and the fair value of the associated loans included in investments was $11.1 million. As of December 31, 2025, the carrying value of secured borrowings totaled $12.0 million and the fair value of the associated loans included in investments was $12.0 million. These secured borrowings were created as a result of our completion of partial loan sales of certain unitranche loan assets that did not meet the definition of a “participating interest” as defined in ASC 860 (see Note 2. Significant Accounting Policies - Partial loan and equity sales to our consolidated financial statements for more information). As a result, sale treatment was not permitted and these partial loan sales were treated as secured borrowings. The weighted average interest rate on our secured borrowings was approximately 7.838% and 7.917% as of June 30, 2026 and December 31, 2025, respectively.
As of June 30, 2026, the weighted average stated interest rates for our SBA debentures and the Notes were 4.463% and 6.703%, respectively. As of June 30, 2026, we had $112.4 million of unutilized commitment under our SPV Credit Facility, and we were subject to a 0.500% fee on such amount. As of June 30, 2026, the weighted average stated interest rate on total debt outstanding was 5.776%.
As a BDC, we are generally required to meet an asset coverage ratio of at least 150% (defined as the ratio which the value of our consolidated total assets, less all consolidated liabilities and indebtedness not represented by senior securities, bears to the aggregate amount of senior securities representing indebtedness), which includes borrowings and any preferred stock we may issue in the future. This requirement limits the amount that we may borrow. On April 29, 2019, our Board, including a majority of the non-interested directors, approved a minimum asset coverage ratio of 150% under Sections 18(a)(1) and 18(a)(2) of the 1940 Act, effective as of April 29, 2020. We also have received exemptive relief from the U.S. Securities and Exchange Commission (“SEC”) to allow us to exclude the senior securities issued by the SBIC Funds and any future SBIC subsidiary from the definition of senior securities in the 150% asset coverage requirement applicable to the Company under the 1940 Act, which, in turn, will enable us to fund more investments with debt capital.
As a BDC, we are generally not permitted to issue and sell our common stock at a price below net asset value per share. We may, however, sell our common stock, or warrants, options or rights to acquire our common stock, at a price below the then-current net asset value per share of our common stock if the Board, including the independent directors, determines that such sale is in the best interests of us and our stockholders, and if our stockholders approve such sale. On June 24, 2026, our stockholders approved a proposal to authorize us to sell or otherwise issue common stock at a price below net asset value per share for a period of one year ending on the earlier of June 24, 2027 or the date of our 2027 Annual Meeting of Stockholders. Our stockholders specified that the cumulative number of shares sold pursuant to such authority during such period may not exceed 25% of our then outstanding common stock immediately prior to each such sale.
On November 10, 2022, the Company established the at-the-market program (the “ATM Program”), pursuant to which the Company may offer and sell, from time to time through Raymond James & Associates, Inc. and B. Riley Securities, Inc., each as sales agents, shares of the Company’s common stock having an aggregate offering price of up to $50.0 million. On August 11, 2023, the Company increased the maximum amount of shares to be sold through the ATM Program to $150.0 million from $50.0 million. On February 29, 2024, the Company increased the maximum amount of shares to be sold through the ATM Program to $300.0 million from $150.0 million. On March 2, 2026, the Company increased the maximum amount of shares to be sold through the ATM Program to $400.0 million from $300.0 million. Cumulative to June 30, 2026, the Company has sold 13,300,342 shares of common
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stock under the ATM Program at a weighted-average price of $19.94, raising $265.2 million of gross proceeds. Net proceeds were $261.8 million after commissions to the sales agents on shares sold. As of June 30, 2026, the Company had $134.8 million available under the ATM Program.
We have an open market stock repurchase program (the “Stock Repurchase Program”) under which we may acquire up to $5.0 million of our outstanding common stock. Under the Stock Repurchase Program, we may, but are not obligated to, repurchase outstanding common stock in the open market from time to time provided that we comply with the prohibitions under our insider trading policies and the requirements of Rule 10b-18 of the Securities Exchange Act of 1934, as amended, including certain price, market value and timing constraints. The timing, manner, price and amount of any share repurchases will be determined by our management, in its discretion, based upon the evaluation of economic and market conditions, stock price, capital availability, applicable legal and regulatory requirements and other corporate considerations. Most recently, on November 3, 2025, the Board extended the Stock Repurchase Program through December 31, 2026, or until the approved dollar amount has been used to repurchase shares. The Stock Repurchase Program does not require us to repurchase any specific number of shares and we cannot assure that any shares will be repurchased under the Stock Repurchase Program. The Stock Repurchase Program may be suspended, extended, modified or discontinued at any time. We did not make any repurchases of common stock during the three and six months ended June 30, 2026 and 2025. Refer to Note 8. Common Stock to our consolidated financial statements for additional information concerning stock repurchases.
Critical Accounting Policies and Use of Estimates
The preparation of financial statements in accordance with GAAP requires management to make certain estimates and assumptions affecting amounts reported in the financial statements. We have identified investment valuation, revenue recognition and transfers of financial assets as our most critical accounting policies and estimates. We continuously evaluate our policies and estimates, including those related to the matters described below. These estimates are based on the information that is currently available to us and on various other assumptions that we believe to be reasonable under the circumstances. Actual results could differ materially from those estimates under different assumptions or conditions. A discussion of our critical accounting policies relating to investment valuations and transfers of financial assets are set forth below. See Note 2. Significant Accounting Policies to our consolidated financial statements for more information regarding our critical accounting policies relating to revenue recognition.
Valuation of Portfolio Investments
As a BDC, we report our assets and liabilities at fair value at all times consistent with GAAP and the 1940 Act. Accordingly, we are required to periodically determine the fair value of all of our portfolio investments.
Our investments generally consist of illiquid securities including debt and equity investments in lower middle-market companies. Investments for which market quotations are readily available are valued at such market quotations. Because we expect that there will not be a readily available market for substantially all of the investments in our portfolio, we value substantially all of our portfolio investments at fair value as determined in good faith by our board of directors using a documented valuation policy and consistently applied valuation process. Due to the inherent uncertainty of determining the fair value of investments that do not have a readily available market quotation, the fair value of our investments may differ significantly from the values that would have been used had a readily available market quotation existed for such investments, and the difference could be material.
With respect to investments for which market quotations are not readily available, our board of directors undertakes a multi-step valuation process each quarter, as described below:
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In making the good faith determination of the value of portfolio investments, we start with the cost basis of the security. The transaction price is typically the best estimate of fair value at inception. When evidence supports a subsequent change to the carrying value from the original transaction price, adjustments are made to reflect the expected exit values.
Our Board consulted with the independent third-party valuation firm(s) in arriving at our determination of fair value for 22 and 21 of our portfolio company investments representing 26.4% and 26.7% of the total portfolio investments at fair value (exclusive of new portfolio company investments made during the three months ended June 30, 2026 and December 31, 2025, respectively) as of June 30, 2026 and December 31, 2025, respectively.
Consistent with the policies and methodologies adopted by the Board, we perform detailed valuations of our debt and equity investments, including an analysis on the Company’s unfunded debt investment commitments, using both the market and income approaches as appropriate. Under the market approach, we typically use the enterprise value methodology to determine the fair value of an investment. There is no one methodology to estimate enterprise value and, in fact, for any one portfolio company, enterprise value is generally best expressed as a range of values, from which we derive a single estimate of enterprise value. Under the income approach, we typically prepare and analyze discounted cash flow models to estimate the present value of future cash flows of either an individual debt investment or of the underlying portfolio company itself.
We evaluate investments in portfolio companies using the most recent portfolio company financial statements and forecasts. We also consult with the portfolio company’s senior management to obtain further updates on the portfolio company’s performance, including information such as industry trends, new product development and other operational issues.
For our debt investments, the primary valuation technique used to estimate the fair value is the discounted cash flow method. However, if there is deterioration in credit quality or a debt investment is in workout status, we may consider other methods in determining the fair value, including the value attributable to the debt investment from the enterprise value of the portfolio company or the proceeds that would be received in a liquidation analysis. Our discounted cash flow models estimate a range of fair values by applying an appropriate discount rate to the future cash flow streams of our debt investments, based on future interest and principal payments as set forth in the associated debt investment agreements. We prepare a weighted average cost of capital for use in the discounted cash flow model for each investment, based on factors including, but not limited to: current pricing and credit metrics for similar proposed or executed investment transactions of private companies; the portfolio company’s historical financial results and outlook; and the portfolio company’s current leverage and credit quality as compared to leverage and credit quality as of the date the investment was made. We may also consider the following factors when determining the fair value of debt investments: the portfolio company’s ability to make future scheduled payments; prepayment penalties and other fees; estimated remaining life; the nature and realizable value of any collateral securing such debt investment; and changes in the interest rate environment and the credit markets that generally may affect the price at which similar investments may be made. We estimate the remaining life of our debt investments to generally be the legal maturity date of the instrument, as we generally intend to hold debt investments to maturity. However, if we have information available to us that the debt investment is expected to be repaid in the near term, we would use an estimated remaining life based on the expected repayment date.
For our equity investments, including equity securities and warrants, we generally use a market approach, including valuation methodologies consistent with industry practice, to estimate the enterprise value of portfolio companies. Typically, the enterprise value of a private company is based on multiples of EBITDA, net income, revenues, or in limited cases, book value. In estimating the enterprise value of a portfolio company, we analyze various factors consistent with industry practice, including but not limited to original transaction multiples, the portfolio company’s historical and projected financial results, applicable market trading and transaction comparables, applicable market yields and leverage levels, the nature and realizable value of any collateral, the markets in which the portfolio company does business, and comparisons of financial ratios of peer companies that are public.
We may also utilize an income approach when estimating the fair value of our equity investments, either as a primary methodology if consistent with industry practice or if the market approach is otherwise not applicable, or as a supporting methodology to corroborate the fair value ranges determined by the market approach. We typically prepare and analyze discounted cash flow models based on projections of the future free cash flows (or earnings) of the portfolio company. We consider various factors, including but not limited to the portfolio company’s projected financial results, applicable market trading and transaction comparables, applicable market yields and leverage levels, the markets in which the portfolio company does business, and comparisons of financial ratios of peer companies that are public.
Determination of fair value involves subjective judgments and estimates. Accordingly, the notes to our consolidated financial statements express the uncertainties with respect to the possible effect of such valuations, and any changes in such valuations, on the consolidated financial statements.
Transfers of Financial Assets
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Partial loan and equity sales. We follow the guidance in ASC 860, Transfers and Servicing, when accounting for loan (debt investment) participations, equity assignments and other partial loan sales. Such guidance requires a participation, assignment or other partial loan or equity sale to meet the definition of a “participating interest,” as defined in the guidance, in order for sale treatment to be allowed. Participations, assignments or other partial loan or equity sales which do not meet the definition of a participating interest should remain on our consolidated statements of assets and liabilities and the proceeds recorded as a secured borrowing until the definition is met.
Related Party Transactions
We have entered into a number of business relationships with affiliated or related parties, including the following:
In connection with the IPO and our election to be regulated as a BDC, we applied for and received exemptive relief from the SEC on March 27, 2012 to allow us to take certain actions that would otherwise be prohibited by the 1940 Act, as applicable to BDCs. Effective June 30, 2014, pursuant to exemptive relief from the SEC, we are permitted to exclude the senior securities issued by the SBIC Funds and any future SBIC subsidiary from the definition of senior securities in the asset coverage requirement applicable to the Company under the 1940 Act.
While we may co-invest with investment entities managed by the Investment Advisor or its affiliates, to the extent permitted by the 1940 Act and the rules and regulations thereunder, the 1940 Act imposes significant limits on co-investment. Our Investment Advisor and its affiliates has received an exemptive order that expands our ability to co-invest in portfolio companies with other funds managed by the Investment Advisor or its affiliates (“Affiliated Funds”) in a manner consistent with our investment objective, positions, policies, strategies and restrictions as well as regulatory requirements and other pertinent factors, subject to compliance with certain conditions (the “Order”). Pursuant to the Order, we are permitted to co-invest with our affiliates if a “required majority” (as defined in Section 57(o) of the 1940 Act) of the Independent Directors make certain conclusions in connection with a co-investment transaction, including that (1) the terms of the transactions, including the consideration to be paid, are reasonable and fair to us and our stockholders and do not involve overreaching by us or our stockholders on the part of any person concerned, and (2) the transaction is consistent with the interests of our stockholders and is consistent with our investment objective and strategies. However, neither we nor our affiliates are obligated to invest or co-invest when investment opportunities are referred to us or them.
In addition, we and our Investment Advisor have each adopted a joint code of ethics pursuant to Rule 17j-1 under the 1940 Act that governs the conduct of our and the Investment Advisor’s officers, directors and employees. Additionally, the Investment Advisor has adopted a code of ethics pursuant to Rule 204A-1 under the Advisers Act of 1940, as amended, and in accordance with Rule 17j-1(c) under the 1940 Act. We have also adopted a code of business conduct that is applicable to all officers, directors and employees of Fidus and our Investment Advisor. Our officers and directors also remain subject to the duties imposed by both the 1940 Act and the Maryland General Corporation Law.
Recent Developments
On July 24, 2026, we issued an additional $7.5 million in SBA debentures, which will bear interest at a fixed interim interest rate of 4.746% until the pooling date in September 2026.
On July 31, 2026, we exited our second lien and subordinated debt investments in Virtex Enterprises, LP, which had been on non-accrual status and previously written down. We received payment of $0.2 million, resulting in an aggregate realized loss of $11.0 million.
66
On August 3, 2026, our Board declared a regular quarterly dividend of $0.43 per share and a supplemental dividend of $0.07 per share payable on September 29, 2026, to stockholders of record as of September 15, 2026.
Item 3. Quantitative and Qualitative Disclosures About Market Risk.
We are subject to financial market risks, including changes in interest rates. Changes in interest rates affect both our cost of funding and the valuation of our investment portfolio. Uncertainty with respect to interest rates, inflationary pressures, geopolitical conditions, and new tariffs and trade barriers, and the effects of this volatility has materially impacted and could continue to materially impact our market risks. Our risk management systems and procedures are designed to identify and analyze our risk, to set appropriate policies and limits and to continually monitor these risks and limits by means of reliable administrative and information systems and other policies and programs. The prices of securities held by us may decline in response to certain events, including those directly involving the companies in which we invest and conditions affecting the general economy, including: overall market changes, including an increase in market volatility; legislative reform; local, regional, national or global political, social or economic instability; and interest rate volatility.
In the future, our investment income may also be affected by changes in various interest rates, including SOFR and prime rates, to the extent of any debt investments that include floating interest rates. The Federal Reserve reduced interest rates by 0.25% in each of September, October and December of 2025, bringing the benchmark rate to the 3.50% to 3.75% range. The Federal Reserve has maintained this range at each of its meetings in 2026. In considering the extent and timing of additional rate cuts in the future, the Federal Reserve stated that it will carefully assess incoming data relating to inflationary pressures and the unemployment rate, the evolving economic outlook, and the balance of risks. There can be no assurance regarding the magnitude or timing of future federal funds rate adjustments in either direction. In an elevated interest rate environment, our cost of funds would increase, which could reduce our net investment income if there is not a corresponding increase in interest income generated by our investment portfolio. Conversely, sustained reductions in interest rates will reduce our gross investment income and could result in a decrease in our net investment income if such decreases in base rates, such as SOFR are not offset by a corresponding increase in the spread over such base rate that we earn on any portfolio investments, a decrease in our operating expenses, including with respect to our income incentive fee, or a decrease in the interest rate of our floating interest rate liabilities tied to such base rate. See Item 1A. "Risk Factors – Changes in interest rates will affect our cost of capital and net investment income” and “Risk Factors – Inflation may adversely affect the business, results of operations and financial condition of our portfolio companies, which may, in turn, impact the valuation of such portfolio companies.
As of June 30, 2026 and December 31, 2025, the debt investments in 61 and 58 portfolio companies, respectively, bore interest at a variable rate, which represented $930.6 million, or 72.4%, and $890.1 million, or 75.3%, of our portfolio on a fair value basis, respectively, and the remainder of our debt portfolio was comprised entirely of fixed rate investments. Our pooled SBA debentures and our unsecured notes bear interest at fixed rates. Our SPV Credit Facility bears interest, at our election, at a rate per annum equal to one-month Term SOFR plus 0.11448% and an applicable margin of 2.675% (or 2.50% after satisfying certain step-down conditions, with commensurate reductions in the applicable margins for alternate base rate loans). We pay a commitment fee that varies depending on the size of the unused portion of the SPV Credit Facility: (1) if the utilized portion of the aggregate commitments as of the close of business on such day is less than 35% of the aggregate commitments (the “Minimum Utilization Amount”), the commitment fee will equal the sum of (a) the then applicable margin multiplied by (i) the Minimum Utilization Amount minus (ii) the aggregate outstanding principal balance of the advances on such day and (b) 0.50% multiplied by 65% of the commitments and (2) if the utilized portion of the aggregate commitments is greater than or equal to the Minimum Utilization Amount, the commitment fee will equal 0.50% multiplied by the unused amount of the commitments.
Because we currently borrow, and plan to borrow in the future, 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 the funds borrowed. Accordingly, 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.
The following table shows the approximate annualized increase or decrease in the components of net investment income due to hypothetical base rate changes in interest rates, assuming no changes in our investments and borrowings as of June 30, 2026 (dollars in millions):
Interest Expense
Increase
Net Increase
Net Investment
Basis Point Increase (Decrease)
(Decrease) (1) (2)
(Decrease) (4)
(Decrease)
Income (3)
(200
(17.3
(2.5
(14.8
(11.8
(150
(14.1
(12.2
(9.8
(100
(9.5
(1.3
(8.2
(6.6
(4.8
(3.3
4.2
150
19.1
2.4
16.7
13.4
23.8
300
28.6
25.0
20.0
(1) Certain of our variable rate debt investments have a PRIME or SOFR interest rate floor, which lessens the impact of decreases in interest rates.
(2) Interest income calculated assuming three-month SOFR, and PRIME rate as of June 30, 2026.
(3) Includes the impact of income incentive fee at 20.0% on net increase (decrease) in net interest.
(4) As of June 30, 2026, we had $112.7 million in borrowings outstanding under our SPV Credit Facility.
Item 4. Controls and Procedures.
Evaluation of Disclosure Controls and Procedures
We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in the reports that we file or submit under the Exchange Act, 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. Our Chief Executive Officer and Chief Financial Officer carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) of the 1934 Act) as of the end of the period covered by this report. Based on the evaluation of these disclosure controls and procedures, the Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective. It should be noted that any system of controls, however well designed and operated, can provide only reasonable, and not absolute, assurance that the objectives of the system are met. In addition, the design of any control system is based in part upon certain assumptions about the likelihood of future events. Because of these and other inherent limitations of control systems, there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions, regardless of how remote.
Changes in Internal Control over Financial Reporting
There were no changes in our internal control over financial reporting during the second quarter of 2026 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Item 1. Legal Proceedings.
We are not, and the Investment Advisor is not, currently subject to any material legal proceedings.
Item 1A. Risk Factors.
There have been no material changes to the risk factors previously disclosed under "Item 1A. Risk Factors” previously disclosed in our Annual Report on Form 10-K for the year ended December 31, 2025 filed with the SEC on February 26, 2026, which are incorporated herein by reference. The risk factors therein could materially affect our business, financial condition and/or operating results. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially affect our business, financial condition and/or operating results.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
Sales of Unregistered Securities
None.
Issuer Purchases of Equity Securities
We have an open market stock repurchase program (the “Stock Repurchase Program”) under which we may acquire up to $5.0 million of our outstanding common stock. Under the Stock Repurchase Program, we may, but are not obligated to, repurchase outstanding common stock in the open market from time to time provided that we comply with the prohibitions under our insider trading policies and the requirements of Rule 10b-18 of the Securities Exchange Act of 1934, as amended, including certain price, market value and timing constraints. The timing, manner, price and amount of any share repurchases will be determined by our management, in its discretion, based upon the evaluation of economic and market conditions, stock price, capital availability, applicable legal and regulatory requirements and other corporate considerations. Most recently, on November 3, 2025, the Board extended the Stock Repurchase Program through December 31, 2026, or until the approved dollar amount has been used to repurchase shares. The Stock Repurchase Program does not require us to repurchase any specific number of shares and we cannot assure that any shares will be repurchased under the Stock Repurchase Program. The Stock Repurchase Program may be suspended, extended, modified or discontinued at any time.
Item 3. Defaults Upon Senior Securities.
Item 4. Mine Safety Disclosures.
Item 5. Other Information.
(a)
(b)
(c)
For the period covered by this Quarterly Report on Form 10-Q, no director or officer of the Company has entered into any (i) contract, instruction or written plan for the purchase or sale of securities of the Company intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) under the Exchange Act or (ii) any non-Rule 10b5-1 trading arrangement.
Item 6. Exhibits.
Number
Exhibit
Articles of Amendment and Restatement of the Registrant (Filed as Exhibit (a)(1) to Pre-Effective Amendment No. 2 to the Registrant’s Registration Statement on Form N-2 (File No. 333-172550) filed with the U.S. Securities and Exchange Commission on April 29, 2011 and incorporated herein by reference).
Bylaws of the Registrant (Filed as Exhibit (b)(1) to Pre-Effective Amendment No. 2 to the Registrant’s Registration Statement on Form N-2 (File No. 333-172550) filed with the U.S. Securities and Exchange Commission on April 29, 2011 and incorporated herein by reference).
Form of Stock Certificate of the Registrant (Filed as Exhibit (d) to Pre-Effective Amendment No. 2 to the Registrant’s Registration Statement on Form N-2 (File No. 333-172550) filed with the U.S. Securities and Exchange Commission on April 29, 2011 and incorporated herein by reference).
Agreement to Furnish Certain Instruments (Filed as Exhibit (f)(2) to Pre-Effective Amendment No. 3 to the Registrant’s Registration Statement on Form N-2 (File No. 333-172550) filed with the U.S. Securities and Exchange Commission on May 26, 2011 and incorporated herein by reference).
Form of Indenture (Filed as Exhibit (d)(5) to Post-Effective Amendment No. 2 to the Registrant’s Registration Statement on Form N-2 (File No. 333-202531) filed with the U.S. Securities and Exchange Commission on April 29, 2016 and incorporated herein by reference).
4.4
Sixth Supplemental Indenture, dated as of March 19, 2025, by and between Fidus Investment Corporation and U.S. Bank Trust Company, National Association (as successor in interest to U.S. Bank National Association), as trustee (Filed as Exhibit 4.2 to the Registrant’s Current Report on Form 8-K filed with the U.S. Securities and Exchange Commission on March 19, 2025 and incorporated herein by reference).
4.5
Form of Global Note with respect to the 6.750% Notes due 2030 (Filed as Exhibit 4.3 to the Registrant’s Current Report on Form 8-K filed with the U.S. Securities and Exchange Commission on March 19, 2025 and incorporated herein by reference).
Registration Rights Agreement, dated as of May 29, 2026, by and among Fidus Investment Corporation and the institutional purchasers party thereto (Filed as Exhibit 4.1 to the Registrant’s Current Report on Form 8-K filed with the U.S. Securities and Exchange Commission on May 29, 2026 and incorporated herein by reference).
31.1
Chief Executive Officer Certification Pursuant to Rule 13a-14 of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*
31.2
Chief Financial Officer Certification Pursuant to Rule 13a-14 of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*
32.1
Certification pursuant to Section 1350, Chapter 63 of Title 18, United States Code, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*
101.INS
Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because XBRL tags are embedded within the Inline XBRL document
101.SCH
Inline XBRL Taxonomy Extension Schema Document
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
104
Cover Page Interactive Data File (embedded within the Inline XBRL document)*
*Filed herewith.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
Date: August 6, 2026
/s/ EDWARD H. ROSS
Edward H. Ross
Chairman and Chief Executive Officer
(Principal Executive Officer)
/s/ SHELBY E. SHERARD
Shelby E. Sherard
Chief Financial Officer
(Principal Financial and Accounting Officer)