What changed in this filing

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Item 5. Market for Registrant’s Common Equity

2025-03-04 compared with 2024-03-05 · 58 added, 62 removed, 218 unchanged (36% of the section changed)

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The last reported sale price for our common stock on The Nasdaq Global Select Market on February 27, 2025 was $8.45 per share.

As of February 27, 2024, there were two holders of record of the common stock, one of which was OFSAM Holdings.

As of February 27, 2025, there were three holders of record of the common stock, one of which was OFSAM Holdings.

A holder of record does not identify stockholders for whom shares are held beneficially in “nominee” or “street name”.

The following table lists the high and low sale price for our common stock, NAV per share, and the cash distributions per share that we have declared on our common stock for each fiscal quarter during the last two most recently completed fiscal years.

The following table lists the high and low intraday sale price for our common stock, NAV per share, and the cash distributions per share that we have declared on our common stock for each fiscal quarter during the last two most recently completed fiscal years.

The stock quotations are inter-dealer quotations and do not include markups, markdowns or commissions.

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The NAVs shown are based on outstanding shares at the end of each period.

* Not determinable at the time of filing.

Issuer Purchases of Equity Securities

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On May 22, 2018, the Board authorized the Stock Repurchase Program under which we could acquire up to $10.0 million of our outstanding common stock through the two-year period ending May 22, 2020.

On May 4, 2020 and May 3, 2022, the Board extended the Stock Repurchase Program for additional two-year periods.

On each of May 4, 2020 and May 3, 2022, the Board extended the Stock Repurchase Program for additional two-year periods.

On April 30, 2024, the Board extended the Stock Repurchase Program for an additional two-year period through May 22, 2026.

Under the extended Stock Repurchase Program, we are authorized to repurchase shares in open-market transactions, including through block purchases, depending on prevailing market conditions and other factors.

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During the year ended December 31, 2024, we did not make any repurchases of our common stock.

The following table summarizes the shares of common stock that we repurchased under the Stock Repurchase Program during the periods noted below (amounts in thousands except shares):

The following table summarizes the shares of common stock that we repurchased under the Stock Repurchase Program during the years ended December 31, 2024, 2023 and 2022 (amounts in thousands except shares):

Period Total Number of Shares Purchased Average Price Paid Per Share Total Number of Shares Purchased as Part of the Program Approximate Dollar Value of Shares That May Yet be Purchased Under the Program

January 1, 2021 through January 31, 2021 700 $ 6.72 700 $ 9,992

September 1, 2022 through September 30, 2022 28,335 8.14 28,335 9,762

October 1, 2022 through October 31, 2022 13,919 8.63 13,919 9,642

January 1, 2022 through December 31, 2022 42,254 $ 8.30 42,254 $ 9,642

January 1, 2023 through December 31, 2023 — — — 9,642

January 1, 2024 through December 31, 2024 — — — 9,642

Total 42,254 $ 8.30 42,254 $ 9,642

Dividend Reinvestment Plan (DRIP)

During the year ended December 31, 2023, there was $0.3 million of distributions reinvested under the DRIP.

During the year ended December 31, 2024, there were $0.3 million of distributions reinvested under the DRIP.

For additional information concerning the DRIP, see Note 10 of our consolidated financial statements in “Part II, Item 8.

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Stock Performance Graph

This graph compares the return on our common stock with that of the Standard & Poor’s 500 Stock Index, the Russell 1000 Index and the Standard & Poor’s BDC Index, for the last 10 fiscal years.

The graph assumes that, on December 31, 2013, a person invested $10,000 in our common stock, the Standard & Poor’s 500 Stock Index, the Russell 1000 Index and the Standard & Poor’s BDC Index.

This graph compares the return on our common stock with that of the Standard & Poor’s (“S&P”) 500 Stock Index, the Russell 1000 Index and the S&P BDC Index, for the last 10 fiscal years.

The graph assumes that, on December 31, 2014, a person invested $10,000 in our common stock, the S&P 500 Stock Index, the Russell 1000 Index and the S&P BDC Index.

The graph measures total stockholder return, which takes into account changes in stock price and assumes reinvestment of all dividends and distributions prior to any tax effect.

Annualized Total Returns

1 Year 5 Year 10 Year

1 Year 5 Year 10 Year 10 Year - Cumulative

OFS Capital Corporation (19.7) % 6.7 % 8.9 % 134.6 %

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Offering expenses borne by us (as a percentage of offering price) — % (2)

Dividend reinvestment plan fees (per sales transaction fee) $ 15.00 (2)

DRIP fees (per sales transaction fee) $ 15.00 (3)

Total Stockholder transaction expenses (as a percentage of offering price) — %

Annual expenses (as a percentage of net assets attributable to common stock) :

Estimated annual expenses (as a percentage of net assets attributable to common stock) :

Base management fees payable under the Investment Advisory Agreement 4.14 % (4)

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Other expenses 2.57 % (7)

Total annual expenses, before base management fee reduction 23.46 %

Base management fee reduction ( 0.75 ) % (8)

Total annual expenses, net of base management fee reduction 22.71 % (7)

(1) The amounts set forth in this table do not reflect the impact of any sales load, sales commission or other offering expenses borne by the Company and its stockholders.

If applicable, the prospectus or prospectus supplement relating to an offering of our common stock will disclose the offering price and the estimated offering expenses and total stockholder transaction expenses borne by the Company and its common stockholders as a percentage of the offering price.

In the event that shares of our common stock are sold to or through underwriters, the applicable prospectus or prospectus supplement will also disclose the applicable sales load and the “Example” will be updated accordingly.

Total annual expenses 18.81 % (8)

(1) The amounts set forth in this table do not reflect the impact of any sales load borne by the Company and its stockholders.

If applicable, the prospectus supplement relating to an offering of our common stock will disclose the applicable sales load borne by the Company and its common stockholders as a percentage of the offering price and the following “Example” will be updated accordingly.

(2) The related prospectus supplement will also disclose the applicable offering expenses and total stockholder transaction expenses.

(3) The expenses of the DRIP are included in “other expenses.” The plan administrator’s fees will be paid by us.

There will be no brokerage charges or other charges to stockholders who participate in the plan except that, if a participant elects by written notice to the plan administrator to have the plan administrator sell part or all of the shares held by the plan administrator in the participant’s account and remit the proceeds to the participant, the plan administrator is authorized to deduct a $15.00 transaction fee plus a $0.10 per share brokerage commission from the proceeds.

(3) Our base management fee is 1.75% of the average value of our total assets (other than cash and cash equivalents) but including assets purchased with borrowed amounts, and including assets owned by any consolidated entity.

This item represents actual base management fees incurred by us during the year ended December 31, 2023 before the effect of the base management fee reduction on certain assets and assumes net assets of $162.0 million and leverage of $302.4 million, which reflects our net assets and leverage as of December 31, 2023.

As discussed in footnote (8), below, OFS Advisor agreed to reduce a portion of its base management fee on certain assets;

the base management fees of 5.21% presented in the table above does not reflect the ( 0.75 )% effect of the base management fee reduction on certain assets.

(4) Our base management fee is 1.75% of the average value of our total assets (other than cash and cash equivalents but including assets purchased with borrowed amounts and assets owned by any consolidated entity).

This item represents projected base management fees for the next twelve months assuming that the base management fee expense remains consistent with the base management fee incurred during the year ended December 31, 2024.

The estimated base management fee used for the calculation in the table above excludes the fee reduction on OFSCC-FS Assets agreed to by OFS Advisor for the year ended December 31.

See “Management and Other Agreements—Investment Advisory Agreement.”

(4) The incentive fee in the table above is based on actual amounts incurred for the Income Incentive Fee for the year ended December 31, 2023, which includes the effects of the base management fee reduction discussed in footnote (3).

(5) The incentive fee assumes that the Income Incentive Fee we will incur during the next twelve months remains consistent with the actual amounts incurred for the Income Incentive Fee for the year ended December 31, 2024.

The Capital Gains Fee will be accrued, but not necessarily become payable, if, on a cumulative basis, the sum of net realized capital gains and losses plus net unrealized appreciation and depreciation is positive.

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The effect of this provision is that, if pre-incentive fee net investment income exceeds 2.5% in any calendar quarter, OFS Advisor will receive 20.0% of our pre-incentive fee net investment income as if a hurdle rate did not apply.

accumulation of amounts on the hurdle rate from quarter to quarter and accordingly there is no clawback of amounts previously paid if subsequent quarters are below the quarterly hurdle rate and there is no delay of payment if prior quarters are below the quarterly hurdle rate.

There is no accumulation of amounts on the hurdle rate from quarter to quarter and accordingly there is no clawback of amounts previously paid if subsequent quarters are below the quarterly hurdle rate and there is no delay of payment if prior quarters are below the quarterly hurdle rate.

• The Capital Gains Fee, payable annually in arrears, equals 20.0% of our realized capital gains on a cumulative basis, if any (or upon the termination of the Investment Advisory Agreement, as of the termination date), computed net of all realized capital losses and unrealized capital depreciation on a cumulative basis, less the aggregate amount of any previously paid capital gain incentive fees.

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See “Management and Other Agreements—Investment Advisory Agreement.”

(5) Interest payments on borrowed funds is based on our estimated cost of funds on our outstanding indebtedness as of December 31, 2023.

Based on our outstanding indebtedness as of December 31, 2023, our estimated annualized cost of funds, which includes all interest and amortization of debt issuance costs is 6.01 %.

As of December 31, 2023, our asset coverage ratio was 160% (which excludes the SBA debentures as a result of exemptive relief granted to us by the SEC) as permitted under Section 61(a)(2) of the 1940 Act.

(6) Interest payments on borrowed funds assumes that the interest expense we will incur during the next twelve months remains consistent with the actual interest expense incurred during the year ended December 31, 2024.

Borrowing costs also include amortization of deferred debt issuance costs related to the issuance of our outstanding debt.

As of December 31, 2024, our asset coverage ratio was 169% as permitted under Section 61(a)(2) of the 1940 Act, and assumes a weighted average interest rate for our assumed average outstanding borrowings of 6.38%, which is equal to the weighted average effective interest rate of our debt during the year ended December 31, 2024.

We may borrow additional funds from time to time to make investments to the extent we determine that the economic situation is conducive to doing so.

As of December 31, 2023, availability under the Banc of California Credit Facility and BNP Facility was $25.0 million and $59.5 million, respectively, both subject to a borrowing base and other covenants.

As of December 31, 2024, availability under the Banc of California Credit Facility was $24.0 million, based on the stated advance rate of 50% under the borrowing base and the $1.0 million outstanding.

As of December 31, 2024, availability under the BNP Facility was $82.7 million and $67.4 million remained outstanding.

Our stockholders will bear directly or indirectly the costs of borrowings under any debt instruments we may enter into.

(6) “Other Expenses” referenced in the table above are based on actual amounts incurred for the year ended December 31, 2023.

“Other expenses” include our overhead expenses, including services under the Administration Agreement based on our allocable portion of overhead and other expenses incurred by OFS Services.

See “Management and Other Agreements—Administration Agreement.” “Other Expenses” also include ongoing professional expenses to our independent accountants, legal counsel and compensation of independent directors.

(7) Our stockholders indirectly bear the expenses of underlying funds or other investment vehicles that would be investment companies under section 3(a) of the 1940 Act but for the exceptions to that definition provided for in sections 3(c)(1) and 3(c)(7) of the 1940 Act (“Acquired Funds”) in which we invest.

(7) “Other expenses” assumes that other expenses we incur during the next twelve months remain consistent with the actual amounts incurred during the year ended December 31, 2024.

“Other expenses” includes our overhead expenses, including services under the Administration Agreement based on our allocable portion of overhead and other expenses incurred by OFS Services.

See “Management and Other Agreements—Administration Agreement.” “Other expenses” also includes ongoing professional expenses to our independent accountants, legal counsel, other professional service providers and compensation of independent directors.

(8) Our stockholders indirectly bear the expenses of underlying funds or other investment vehicles in which we invest that would be investment companies under section 3(a) of the 1940 Act but for the exceptions to that definition provided for in sections 3(c)(1) and 3(c)(7) of the 1940 Act.

We do not currently invest in underlying funds or other investment companies and therefore do not expect to incur any acquired fund fees and expenses.

The indirect expenses that are associated with our Structured Finance Securities are not included in the fee table presentation, but if such expenses were included in the fee table presentation then our total annual expenses would have been 22.91%.

(8) OFS Advisor agreed to reduce a portion of its base management fee by reducing the portion of such fee from 1.75% to 1.00% on the average total assets (less cash) at the end of the two most recently completed quarters on assets held by the Company through OFSCC-FS, LLC, an indirect wholly owned subsidiary of the Company.

The base management fee reduction is renewable on an annual basis and the amount of the base management fee reduction with respect to the OFSCC-FS Assets shall not be subject to recoupment by OFS Advisor.

The indirect expenses that will be associated with our Structured Finance Securities are not included in the fee table presentation, but if such expenses were included in the fee table presentation then our total annual expenses would have been 19.04%.

(9) Estimated annual expense captions presented in the table above are computed relative to our net asset value of $172.2 million as of December 31, 2024.

The following example demonstrates the projected dollar amount of total cumulative expenses over various periods with respect to a hypothetical investment in our common stock.

In calculating the following expense amounts, we have assumed we would have no additional leverage and that our annual operating expenses would remain at the levels set forth in the table above.

The expense amounts assume an annual base management fee 1.75% for each year.

In calculating the following expense amounts, we have assumed we would have no additional leverage and that our annual operating expenses would remain at the levels set forth in the table above, except that the incentive fee has been assumed as 0% as further described below, resulting in an assumed total annual expense ratio of 16.38% of net assets.

The expense amounts assume an annual base management fee of 1.75% as described in footnote 4 above, or 4.14 % of net assets, for each year.

Transaction expenses are not included in the following example.

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$ 155 $ 413 $ 616 $ 953

While the example assumes, as required by the applicable rules of the SEC, a 5.0% annual return, our performance will vary and may result in a return greater or less than 5.0%.

The incentive fee under the Investment Management Agreement, which, assuming a 5.0% annual return, would either not be payable or would have an insignificant impact on the expense amounts shown above, is not included in the above example.

While the example assumes a 5.0% annual return, as required by the applicable rules of the SEC, our performance will vary and may result in a return greater or less than 5.0%.

The incentive fee under the Investment Advisory Agreement is subject to an annual rate of return hurdle rate of 8.0% annualized.

Therefore, assuming a 5.0% annual return as in the example above, the incentive fee would either not be payable or would have an insignificant impact on the expense amounts shown above, is not included in the above example.

The above illustration assumes that we will not realize any capital gains (computed net of all realized capital losses and unrealized capital depreciation) in any of the indicated time periods.

If we achieve sufficient returns on our investments, including through the realization of capital gains, to trigger an incentive fee of a material amount, our expenses and returns to our investors would be higher.

For example, if we assumed that we received our 5.0% annual return completely in the form of net realized capital gains on our investments, computed net of all cumulative unrealized depreciation on our investments, the

projected dollar amount of total cumulative expenses set forth in the above illustration would be as follows:

set forth in the above illustration would be as follows:

1 Year 3 Years 5 Years 10 Years

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SENIOR SECURITIES

Information about our senior securities (including preferred stock, debt securities and other indebtedness) is shown in the following table as of the end of the last ten fiscal years.

The senior securities table as of December 31, 2023, 2022, 2021, 2020 and 2019 was audited by KPMG LLP and the senior securities table as of December 31, 2018, 2017, 2016, 2015 and 2014 were audited by our former independent registered public accounting firm.

Information about our senior securities (including preferred stock, debt securities and other indebtedness) is shown in the following table for each year in the ten-year period ended December 31, 2024.

The senior securities table as of December 31, 2024, 2023, 2022, 2021, 2020 and 2019 was audited by KPMG LLP and the senior securities table as of December 31, 2018, 2017, 2016 and 2015 was audited by our former independent registered public accounting firm.

The “ — ” indicates information that the SEC expressly does not require to be disclosed for certain types of senior securities.

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December 31, 2022 $ 125,000 $ 3,721 — N/A

December 31, 2021 $ 125,000 $ 3,870 — N/A

4.95% Notes due 2028

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December 31, 2022 $ 55,000 $ 8,457 — $ 23.27

December 31, 2021 $ 55,000 $ 8,795 — $ 25.51

6.25% Notes due 2023

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December 31, 2020 $ 31,450 $ 11,728 — N/A

Banc of California Credit Facility

December 31, 2019 $ 56,450 $ 6,659 — N/A

December 31, 2022 $ — $ — — N/A

Banc of California Credit Facility

December 31, 2024 $ 1,000 $ 420,574 — N/A

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December 31, 2018 $ 12,000 $ 23,521 — N/A

WM Credit Facility

December 31, 2017 $ 17,600 $ 11,540 — N/A

SBA debentures (SBIC I LP) (5)(6)

December 31, 2016 $ 9,500 $ 15,821 — N/A

December 31, 2015 $ — $ — — N/A

SBA debentures (SBIC I LP) (5)

December 31, 2023 $ 31,920 $ — — N/A

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December 31, 2016 $ 149,880 $ — — N/A

December 31, 2015 $ 149,880 $ — — N/A

Total Senior Securities (6)

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(2) The asset coverage ratio for a class of senior securities representing indebtedness is calculated as our consolidated total assets, less all liabilities and indebtedness not represented by senior securities, divided by the class of senior securities representing indebtedness.

This asset coverage ratio is multiplied by $1,000 to determine the “asset coverage Per Unit.”

This asset coverage ratio is multiplied by $1,000 to determine the “Asset Coverage Per Unit.” The calculation presented for individual classes of senior securities does not include the impact of other classes of senior securities outstanding as of a particular date.

Refer to the Asset Coverage Per Unit for Total Senior Securities below.

(3) The amount to which such class of senior security would be entitled upon the involuntary liquidation of the issuer in preference to any security junior to it.

(4) Average market value per unit for our unsecured notes represents the average of the daily closing prices as reported on the Nasdaq Market during the period presented.

Not applicable to our 4.75% Notes due 2026, the Banc of California Credit Facility, BNP Facility, WM Credit Facility or SBA debentures because these senior securities are not registered for public trading.

(5) The SBA debentures are not subject to the asset coverage requirements of the 1940 Act as a result of exemptive relief granted to us by the SEC.

(6) On March 1, 2024, we fully repaid our outstanding SBA debentures totaling $31.9 million and requested the approval of the SBA to surrender our license to operate as a SBIC.

Management’s Discussion and Analysis of Financial Condition and Results of Operations—Recent Developments.”

Not applicable to our 4.75% Notes due 2026, the Banc of California Credit Facility, BNP Facility or SBA debentures because these senior securities are not registered for public trading.

(5) The SBA debentures were not subject to the asset coverage requirements of the 1940 Act as a result of exemptive relief granted to us by the SEC.

(6) The Asset Coverage Per Unit does not include the SBA debentures as described in footnote (5) above.

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The following is a schedule of financial highlights for each year in the ten-year period ended December 31, 2024.

The financial highlights as of December 31, 2023, 2022, 2021, 2020 and 2019 were audited by KPMG LLP and the financial highlights for each year in the five-year period ended December 31, 2018 are derived from our consolidated financial statements that were audited by our former independent registered public accounting firms.

The data should be read in conjunction with our consolidated financial statements and notes thereto and “Management's Discussion and Analysis of Financial Condition and Results of Operations,” which are included elsewhere in this Annual Report.

The financial highlights as of December 31, 2024, 2023, 2022, 2021, 2020 and 2019 were audited by KPMG LLP and the financial highlights for each year in the four-year period ended December 31, 2018 are derived from our consolidated financial statements that were audited by our former independent registered public accounting firm.

The data should be read in conjunction with our consolidated financial statements and notes thereto and “Item 7.

Management's Discussion and Analysis of Financial Condition and Results of Operations,” which are included elsewhere in this Annual Report.

Year Ended December 31,

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— — 0.01 — (0.03) — — 0.02 — —

— — — — — — 0.05 — — —

Net asset value per share at end of year $ 12.85 $ 12.09 $ 13.47 $ 15.18 $ 11.85 $ 12.46 $ 13.10 $ 14.12 $ 14.82 $ 14.76

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23.1 % 8.8 % 28.0 % 54.9 % 28.1 % 21.2 % 41.9 % 50.4 % 18.1 % 44.6 %

(1) Calculated as ending market value less beginning market value, adjusted for distributions reinvested at prices based on the Company’s dividend reinvestment plan for the respective distributions.

(1) Calculated on the average share method.

(2) The issuance/repurchase of common stock on a per share basis reflects the net asset value change as a result of DRIP issuances, shares repurchased pursuant to the Stock Repurchase Program, the follow-on public offering of 3,625,000 shares during 2017, the anti-dilutive (dilutive) impact from changes in weighted-average shares outstanding during the period, and the difference between the per share amount distributed to common stockholders of record and the per share amount distributed based on the weighted-average shares of common stock outstanding during the applicable period.

(3) Calculated as ending market value less beginning market value, adjusted for distributions reinvested at prices based on the Company’s DRIP for the respective distributions.

(4) Calculated as ending net asset value less beginning net asset value, adjusted for distributions reinvested in the Company’s DRIP for the respective distributions.

(5) Based on the average of the net asset value at the beginning of the indicated period and the end of each calendar quarter within the period indicated.

(4) Calculated on the average share method.

(5) The issuance/repurchase of common stock on a per share basis reflects the net asset value change as a result of DRIP issuances, shares repurchased pursuant to the Stock Repurchase Program or the follow-on public offering of 3,625,000 shares during 2017.

(6) Represents the impact of different share amounts used in calculating per share data as a result of calculating certain per share data based on a weighted- average shares outstanding during the period and certain per share data based on the shares outstanding as of a period end or transaction date.

(7) Portfolio turnover rate is calculated using the lesser of year-to-date sales, Structured Finance Security distributions and principal payments or year-to-date purchases over the average of the invested assets at fair value at the beginning of the indicated period and the end of each calendar quarter within the period indicated.

(6) Ratio of total expenses before incentive fee waiver to average net assets was 22.7% and 13.4% for the years ended December 31, 2020 and December 31, 2018, respectively.

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(8) Ratio of net investment income before incentive fee waiver to average net assets was 8.0% and 10.5% for the years ended December 31, 2020 and December 31, 2018, respectively.

(9) Portfolio turnover rate is calculated using the lesser of year-to-date sales, Structured Finance Security distributions and principal payments or year-to-date purchases over the average of portfolio investments at fair value at the beginning of the indicated period and the end of each calendar quarter within the period indicated.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 5. Market for Registrant’s Common Equity