SARATOGA INVESTMENT CORP. 10-K

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Price range of common stock Our common stock is traded on the NYSE under the symbol “SAR.” The following table lists the high and low closing sale price for our common stock, and the closing sale price as a percentage of NAV for each fiscal quarter during the last two most recently completed fiscal years and any subsequent interim period. Price Range Percentage of High Closing Sales Price as a Premium (Discount) Percentage of Low Closing Sales Price as a Premium (Discount) NAV(1) High Low to NAV(2) to NAV(2) Fiscal Year Ending February 28, 2027 First Quarter through May 1, 2026 $ * $ 23.70 $ 20.92 * * Fiscal Year Ended February 28, 2026 First Quarter $ 25.52 $ 26.00 $ 21.46 1.9 % (15.9 )% Second Quarter $ 25.61 $ 25.54 $ 24.08 (0.3 )% (6.0 )% Third Quarter $ 25.59 $ 25.55 $ 21.56 (0.2 )% (15.7 )% Fourth Quarter $ 24.42 $ 24.02 $ 22.44 (1.6 )% (8.1 )% Fiscal Year Ended February 28, 2025 First Quarter $ 26.85 $ 24.09 $ 22.52 (10.3 )% (16.1 )% Second Quarter $ 27.07 $ 24.42 $ 21.91 (9.8 )% (19.1 )% Third Quarter $ 26.95 $ 26.07 $ 22.95 (3.3 )% (14.8 )% Fourth Quarter $ 25.86 $ 26.00 $ 23.52 0.5 % (9.1 )% * Net asset value has not yet been calculated for this period. (1) Net asset value per share is determined as of the last day in the relevant quarter and therefore may not reflect the net asset value per share on the date of the high and low sales prices. (2) Calculated as the respective high or low closing sales price divided by the quarter end net asset value and subtracting 1. Shares of BDCs may trade at a market price that is less than the NAV of those shares. The possibilities that our shares of common stock will trade at a discount from NAV or at premiums that are unsustainable over the long term are separate and distinct from the risk that our NAV will decrease. The last reported closing sale price of our common stock on May 4, 2026 was $23.89 per share, which represents a discount of approximately 2.2% to the NAV of $24.42 as of February 28, 2026. 60 Summarized Financial Highlights The following table summarizes ten years of financial highlights: For the year ended Per share data February 28, 2026 February 28, 2025 February 29, 2024 February 28, 2023 February 28, 2022 Net asset value at beginning of period $ 25.86 $ 27.12 $ 29.18 $ 29.33 $ 27.25 Net investment income(1) 2.32 3.81 4.49 2.94 1.74 Net realized and unrealized gains (losses) on investments(1) 0.04 (1.73 ) (3.77 ) (0.75 ) 2.46 Realized losses on extinguishment of debt* (0.05 ) (0.06 ) (0.01 ) (0.13 ) (0.21 ) Net increase in net assets resulting from operations 2.31 2.02 0.71 2.06 3.99 Distributions declared from net investment income (3.74 ) (3.30 ) (2.82 ) (2.28 ) (1.93 ) Total distributions to stockholders (3.74 ) (3.30 ) (2.82 ) (2.28 ) (1.93 ) Issuance of common stock at net asset value (2) (0.04 ) (0.16 ) (0.40 ) - - Capital contribution from Manager for the issuance of common stock (8) 0.05 0.26 0.48 - - Repurchases of common stock(3) - - 0.03 0.17 0.01 Dilution(4) (0.02 ) (0.08 ) (0.06 ) (0.10 ) - Net asset value at end of period $ 24.42 $ 25.86 $ 27.12 $ 29.18 $ 29.33 Per share market value at end of period $ 23.16 $ 26.00 $ 23.61 $ 27.55 $ 27.47 Total return based on market value(5) 1.54 % 27.17 % -3.92 % 10.35 % 28.19 % Total return based on net asset value(5)(6) 11.11 % 10.11 % 4.20 % 9.46 % 15.88 % Shares outstanding at end of period 16,224,198 15,183,078 13,653,476 11,890,500 12,131,350 Ratio/Supplemental data: Net assets at end of period 396,155,754 392,665,468 370,224,108 346,958,042 355,780,523 Ratio of total expenses to average net assets* 22.10 % 25.81 % 24.70 % 18.91 % 16.09 % Ratio of net investment income to average net assets* 9.16 % 14.11 % 16.01 % 10.23 % 6.05 % Portfolio turnover rate(7) 18.22 % 16.12 % 2.80 % 24.05 % 33.59 % 61 For the year ended Per share data February 28, 2021 February 29, 2020 February 28, 2019 February 28, 2018 February 28, 2017 Net asset value at beginning of period $ 27.13 $ 23.62 $ 22.96 $ 21.97 $ 22.06 Adoption of ASC 606 - - (0.01 ) - - Net asset value at beginning of period, as adjusted 27.13 23.62 22.95 21.97 22.06 Net investment income(1) 2.07 1.59 2.60 2.11 1.94 Net realized and unrealized gains (losses) on investments(1) (0.74 ) 4.56 0.03 0.82 0.30 Realized losses on extinguishment of debt* (0.01 ) (0.17 ) - - (0.26 ) Net increase in net assets resulting from operations 1.32 5.98 2.63 2.93 2.24 Distributions declared from net investment income (1.23 ) (2.21 ) (2.06 ) (1.90 ) (1.93 ) Total distributions to stockholders (1.23 ) (2.21 ) (2.06 ) (1.90 ) (1.93 ) Issuance of common stock above net asset value(2) - - 0.15 - - Repurchases of common stock(3) 0.13 - - - - Dilution(4) (0.10 ) (0.26 ) (0.05 ) (0.04 ) (0.14 ) Net asset value at end of period $ 27.25 $ 27.13 $ 23.62 $ 22.96 $ 21.97 Per share market value at end of period $ 23.08 $ 22.91 $ 23.04 $ 21.86 $ 22.74 Total return based on market value(5) 7.63 % 9.28 % 16.11 % 5.28 % 80.83 % Total return based on net asset value(5)(6) 7.31 % 26.22 % 13.33 % 14.45 % 12.62 % Shares outstanding at end of period 11,161,416 11,217,545 7,657,156 6,257,029 5,794,600 Ratio/Supplemental data: Net assets at end of period 304,185,770 304,286,853 180,875,187 143,691,367 127,294,777 Ratio of total expenses to average net assets* 13.11 % 18.34 % 19.12 % 19.05 % 17.27 % Ratio of net investment income to average net assets* 7.77 % 6.31 % 11.22 % 9.37 % 8.71 % Portfolio turnover rate(7) 25.26 % 36.82 % 35.26 % 19.73 % 43.76 % * Certain prior period amounts have been reclassified to conform to current period presentation. (1) Per share amounts are calculated using the weighted average shares outstanding during the period. (2) The continuous issuance of common stock may cause an incremental decrease in NAV per share due to the sale of shares at the then prevailing public offering price and the receipt of net proceeds per share by the Company less than NAV per share on each subscription closing date. The per share data was derived by computing (i) the sum of (A) the number of shares issued in connection with subscriptions and/or distribution reinvestment on each share transaction date multiplied by (B) the differences between the net proceeds per share and the NAV per share on each share transaction date, divided by (ii) the total shares outstanding during the period. (3) Represents the anti-dilutive impact on the NAV per share of the Company due to the repurchase of common shares. See Note 11, Stockholders’ Equity. (4) Represents the dilutive effect of issuing common stock below NAV per share during the period in connection with the satisfaction of the Company’s annual RIC distribution requirement and may include the impact of the different share amounts used for different items (weighted average basic common shares outstanding for the corresponding year and actual common shares outstanding at the end of the year) in the per common share data calculation and rounding impacts. See Note 13, Dividend. (5) Total investment return is calculated assuming a purchase of common shares at the current market value on the first day and a sale at the current market value on the last day of the periods reported. Dividends and distributions, if any, are assumed for purposes of this calculation to be reinvested at prices obtained under the Company’s DRIP. Total investment return does not reflect brokerage commissions. (6) Total investment return is calculated assuming a purchase of common shares at the current net asset value on the first day and a sale at the current net asset value on the last day of the periods reported. Dividends and distributions, if any, are assumed for purposes of this calculation to be reinvested at prices obtained under the Company’s DRIP. Total investment return does not reflect brokerage commissions. (7) Portfolio turnover rate is calculated using the lesser of year-to-date sales or year-to-date purchases over the average of the invested assets at fair value. (8) The Manager agreed to reimburse the Company to the extent the per share price of the shares to the public, less underwriting fees, was less than net asset value per share. 62 On September 24, 2014, the Company announced the approval of an open market share repurchase plan that allowed it to repurchase up to 200,000 shares of its common stock at prices below its NAV as reported in its then most recently published consolidated financial statements (the “Share Repurchase Plan”). Since September 24, 2014, the Share Repurchase Plan has been extended annually, and the Company has periodically increased the amount of shares of common stock that may be purchased under the Share Repurchase Plan, which, most recently, was increased to 1.7 million shares of common stock. Most recently, on January 6, 2026, the Company’s board of directors extended the Share Repurchase Plan for another year to January 15, 2027. As shown in the table below, as of February 28, 2026, the Company purchased an aggregate of 1,037,698 shares of common stock, at the average price of $22.05 for approximately $22.9 million pursuant to the Share Repurchase Plan. During the year and quarter ended February 28, 2026, the Company purchased 2,495 shares of common stock, at the average price of $21.75 for approximately $0.1 million pursuant to the Share Repurchase Plan. Period Total Number of Shares (or Units) Purchased Average Price per Share (or Unit) Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May Yet Be Purchased Under the Plans or Programs March 1, 2015 through November 30, 2015 2,500 $ 15.59 2,500 397,500 December 1, 2015 through December 31, 2015 - $ - 2,500 397,500 January 1, 2016 through January 31, 2016 4,200 $ 13.86 6,700 393,300 February 1, 2016 through February 29, 2016 18,717 $ 13.86 25,417 374,583 March 1, 2016 through March 31, 2016 16,282 $ 14.57 41,699 358,301 April 1, 2016 through April 30, 2016 7,858 $ 16.22 49,557 350,443 May 1, 2016 through May 31, 2016 21,357 $ 16.29 70,914 329,086 June 1, 2016 through June 30, 2016 8,310 $ 16.50 79,224 320,776 July 1, 2016 through July 31, 2016 19,212 $ 17.31 98,436 301,564 August 1, 2016 through August 31, 2016 40,058 $ 17.44 138,494 261,506 September 1, 2016 through September 30, 2016 40,221 $ 18.04 178,715 221,285 October 1, 2016 through October 31, 2016 27,076 $ 18.10 205,791 394,209 November 1, 2016 through November 30, 2016 8,600 $ 18.24 214,391 385,609 December 1, 2016 through December 31, 2016 4,100 $ 18.57 218,491 381,509 January 1, 2017 through February 29, 2020 - - 218,491 381,509 March 1, 2020 through February 28, 2021 190,321 $ 18.96 408,812 891,188 March 1, 2021 through February 28, 2022 99,623 $ 25.55 508,435 791,565 March 1, 2022 through February 28, 2023 438,192 $ 24.70 946,627 353,373 March 1, 2023 through February 29, 2024 88,576 $ 24.36 1,035,203 664,797 March 1, 2024 through February 28, 2025 - $ - 1,035,203 664,797 March 1, 2025 through February 28, 2026 2,495 $ 21.75 1,037,698 662,302 Total 1,037,698 $ 22.05 Holders As of May 4, 2026, there were 10 holders of record of our common stock. 63 Performance Graph The following graph compares the return on our common stock with that of the Standard & Poor’s 500 Stock Index, the NASDAQ Financial 100 index and the Standard & Poor’s BDC Index, for the period from March 23, 2007, the date our common stock began trading, through February 28, 2026. The graph assumes that, on March 23, 2007, a person invested $100 in each of our common stock, the Standard & Poor’s 500 Stock Index, the NASDAQ Financial 100 index and the Standard & Poor’s BDC Index. The graph measures total shareholder return, which takes into account both changes in stock price and dividends. It assumes that dividends paid are reinvested in like securities. Outstanding Securities and Debt The following table shows our outstanding classes of securities and debt as of February 28, 2026. Title of Class Amount Authorized Amount Held by us or for Our Account Amount Outstanding Exclusive of Amounts Shown Under Securities: Common Stock 100,000,000 16,224,198 83,775,802 Debt: Live Oak credit facility $ 75,000,000 $ 37,500,000 $ 37,500,000 Valley Bank credit facility $ 85,000,000 $ 32,500,000 $ 52,500,000 SBA Debentures $ 259,000,000 $ 160,000,000 $ 99,000,000 4.35% 2027 Notes $ 75,000,000 $ 75,000,000 $ - 6.00% 2027 Notes $ 105,500,000 $ 105,500,000 $ - 6.25% 2027 Notes $ 15,000,000 $ 15,000,000 $ - 8.00% 2027 Notes $ 46,000,000 $ 46,000,000 $ - 8.125% 2027 Notes $ 60,375,000 $ 60,375,000 $ - 8.50% 2028 Notes $ 57,500,000 $ 57,500,000 $ - 7.25% 2030 Notes $ 50,000,000 $ 50,000,000 $ - 7.50% 2031 Notes $ 100,000,000 $ 100,000,000 $ - 64 FEES AND EXPENSES The following table is intended to assist you in understanding the costs and expenses that an investor will bear directly or indirectly. We caution you that some of the percentages indicated in the table below are estimates and may vary. Except where the context suggests otherwise, whenever this report contains a reference to fees or expenses paid by “you,” “us” or “Saratoga Investment Corp.,” or that “we” will pay fees or expenses, stockholders will indirectly bear such fees or expenses as investors in Saratoga Investment Corp. Stockholder transaction expenses (as a percentage of offering price): Sales load paid - % (1) Offering expenses borne by us - % (2) Dividend reinvestment plan expenses None (3) Total stockholder transaction expenses paid - % Annual estimated expenses (as a percentage of average net assets attributable to common stock): Base Management fees 4.4 % (4) Incentive fees payable under the Management Agreement 2.3 % (5) Interest payments on borrowed funds 12.3 % (6) Other expenses 3.2 % (7) Total annual expenses 22.2 % (8) (1) In the event that the shares of common stock to which this prospectus relates are sold to or through underwriters, a corresponding prospectus supplement will disclose the applicable sales load. (2) The prospectus supplement corresponding to each offering will disclose the applicable offering expenses and total stockholder transaction expenses. (3) The expenses associated with the administration of our dividend reinvestment plan are included in “Other expenses.” The participants in the dividend reinvestment plan will pay a pro rata share of brokerage commissions incurred with respect to open market purchases, if any, made by the administrator under the plan. For more details about the plan, see “Dividend Reinvestment Plan.” (4) Our base management fee under the Management Agreement with Saratoga Investment Advisors is based on our gross assets, which is defined as our total assets, including those acquired using borrowings for investment purposes, but excluding cash and cash equivalents. See “Investment Advisory and Management Agreement.” The fact that our base management fee is payable based upon our gross assets, rather than our net assets (i.e., total assets after deduction of any liabilities, including borrowings) means that our base management fee as a percentage of net assets attributable to common stock will increase when we utilize leverage. (5) The incentive fee consists of two parts. The first part is calculated and payable quarterly in arrears and equals 20% of our “pre-incentive fee net investment income” for the immediately preceding quarter, subject to a preferred return, or “hurdle,” and a “catch up” feature. For this purpose, “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, managerial and consulting fees or other fees that we receive from portfolio companies) accrued by us during the fiscal quarter, minus our operating expenses for the quarter (including the base management fee, expenses payable under the administration agreement described below, and any interest expense and dividends paid on any issued and outstanding preferred stock, but excluding the incentive fee). The second part of the incentive fee is determined and payable in arrears as of the end of each fiscal year (or upon termination of the Management Agreement) and equals 20% of our “incentive fee capital gains,” which equals our realized capital gains on a cumulative basis from May 31, 2010 through the end of the year, if any, 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 fee. Under the Management Agreement, the capital gains portion of the incentive fee is based on realized gains and realized and unrealized losses from May 31, 2010. Therefore, realized and unrealized losses incurred prior to such time will not be taken into account when calculating the capital gains portion of the incentive fee, and Saratoga Investment Advisors will be entitled to 20% of incentive fee capital gains that arise after May 31, 2010. In addition, the cost basis for computing realized gains and losses on investments held by us as of May 31, 2010 will equal the fair value of such investments as of such date. We estimate this as zero for purposes of this table as these fees are difficult to predict, as they are based on capital gains and losses. See “Investment Advisory and Management Agreement.” 65 (6) We may borrow funds from time to time to make investments to the extent we determine that the economic situation is conducive to doing so. The 12.3% figure in the table includes all expected borrowing costs that we expect to incur over the next twelve months in connection with the special purpose vehicle financing credit facility with Live Oak Banking Company (the “Live Oak Credit Facility”) and the special purpose vehicle financing credit facility with Valley National Bank (the “Valley Credit Facility”). The costs associated with our outstanding borrowings are indirectly borne by our stockholders. We do not expect to issue any preferred stock during the next twelve months and, therefore, have not included the cost of issuing and servicing preferred stock in the table. In addition, all of the commitment fees, interest expense, amortized financing costs of the Valley Credit Facility, SBA debentures the 4.35% notes due 2027 (the “4.35% 2027 Notes”), the 6.00% notes due 2027 (the “6.00% 2027 Notes”), the 6.25% notes due 2027 (the “6.25% 2027 Notes), the 8.00% notes due 2027 (the “8.00% 2027 Notes”), the 8.125% notes due 2027 (the “8.125% 2027 Notes”), the 8.50% notes due 2028 (the “8.50% 2028 Notes”) the 7.25% notes due 2030 (the “7.25% 2030 Notes”), and the 7.50% notes due 2031 (the “7.50% 2031 Notes” and together with the 4.35% 2027 Notes, the 6.00% 2027 Notes, the 6.25% 2027 Notes, the 8.00% 2027 Notes, the 8.125% 2027 Notes, the 7.25% 2030 Notes, and the 7.50% 2031 Notes, the “Notes”) and the fees and expenses of issuing and servicing any other borrowings or leverage that we expect to incur during the next twelve months are included in the table and expense example presentation below. On April 16, 2018, our board of directors, including a majority of independent directors, approved the Company becoming subject to a minimum asset coverage ratio of 150%. The 150% asset coverage ratio became effective on April 16, 2019. See “Regulation” and Part I. Item 1A. “Risk Factors—Risks Related to Our Business and Structure—Recent legislation may allow us to incur additional leverage.” (7) “Other expenses” are based on estimated amounts for the current fiscal year and include our overhead expenses, including payments under our administration agreement based on our allocable portion of overhead and other expenses incurred by Saratoga Investment Advisors in performing its obligations under the administration agreement. See “Administration Agreement.” (8) This figure includes all of the fees and expenses of our wholly-owned subsidiaries, Saratoga Investment Corp SBIC II, LP, Saratoga Investment Corp SBIC III, LP, SIF II, and SIF III, but does not include SLF JV. SLF JV is structured as private joint venture, with control and management shared equally between us and TJHA, no management fees are paid by SLF JV. Furthermore, this table reflects all of the fees and expenses borne by us with respect to our investment in Saratoga CLO. Example The following example demonstrates the projected dollar amount of total cumulative expenses over various periods with respect to a hypothetical $1,000 investment in our common stock, assuming an asset coverage ratio of 168.4% (the Company’s actual asset coverage as of February 28, 2026) and total annual expenses of 22.1% of net assets attributable to common stock as set forth in the fees and expenses table above, and (x) a 5.0% annual return resulting entirely from net realized capital gains (none of which is subject to the incentive fee) and (y) a 5.0% annual return resulting entirely from net realized capital gains (all of which is subject to the incentive fee based on capital gains). Transaction expenses are included in the following example. This example and the expenses in the table above should not be considered a representation of our future expenses, and actual expenses (including cost of debt, if any, and other expenses) may be greater or less than those shown. 1 Year 3 Years 5 years 10 years Assuming a 5% annual return on portfolio resulting entirely from net realized capital gains (none of which is subject to the capital gains incentive fee)(1) $ 227 $ 716 $ 1,255 $ 2,856 Assuming a 5% annual return resulting entirely from net realized capital gains (all of which is subject to incentive fee based on capital gains)(2) $ 237 $ 747 $ 1,310 $ 2,982 (1) Assumes that we will not realize any capital gains computed net of all realized capital losses and unrealized capital depreciation. (2) Assumes no unrealized capital depreciation and a 5% annual return resulting entirely from net realized capital gains and therefore subject to the incentive fee based on capital gains. Because our investment strategy involves investments that generate primarily current income, we believe that a 5% annual return resulting entirely from net realized capital gains is unlikely. 66 This example and the expenses in the table above should not be considered a representation of our future expenses, and actual expenses (including the cost of debt, if any, and other expenses) may be greater or less than those shown. The foregoing table is to assist you in understanding the various costs and expenses that an investor in our common stock will bear directly or indirectly. While the example assumes, as required by the SEC, a 5% annual return, our performance will vary and may result in a return greater or less than 5%. Both examples assume that the 5% annual return will be generated entirely through net realized capital gains and, as a result, will trigger the payment of the capital gains portion of the incentive fee under the investment advisory agreement. Any potential income portion of the incentive fee under the investment advisory agreement is not included in the example. If we achieve sufficient returns on our investments, including through net realized capital gains, to trigger an incentive fee of a material amount, our expenses, and returns to our investors, would be higher. In addition, while the example assumes reinvestment of all dividends and distributions at NAV, under certain circumstances, reinvestment of dividends and other distributions under our dividend reinvestment plan may occur at a price per share that differs from NAV. Sales of unregistered securities We did not sell any securities during the year ended February 28, 2026 that were not registered under the Securities Act of 1933, as amended. Issuer purchases of equity securities During the year ended February 28, 2026, February 28, 2025 and February 29, 2024, we purchased 2,495, 0 and 88,576 shares, respectively, of our common stock in the open market. The following table summarizes the purchased common stock on a month to month basis for the year ended February 28, 2026: Period Quantity March 1, 2025 through March 31, 2025 - April 1, 2025 through April 30, 2025 - May 1, 2025 through May 31, 2025 - June 1, 2025 through June 30, 2025 - July 1, 2025 through July 31, 2025 - August 1, 2025 through August 31, 2025 - September 1, 2025 through September 30, 2025 - October 1, 2025 through October 31, 2025 - November 1, 2025 through November 30, 2025 - December 1, 2025 through December 31, 2025 2,495 January 1, 2026 through January 31, 2026 - February 1, 2026 through February 28, 2026 - Total 2,495 67 ITEM 6. - Reserved