Prospect Capital Issues Three Tranches of InterNotes Totaling $89 Million Across Multiple Maturity Dates

Three-Tranche Debt Offering with Staggered Maturity Dates

Prospect Capital Corporation priced three distinct series of unsecured InterNotes on July 27, 2026, each with different maturity profiles and coupon structures. The 2029 Notes, bearing a fixed coupon rate of 6.000% paid semi-annually, carried a principal amount of $22 million and were priced at par value of 100.000 percent. The 2031 Notes represented the largest tranche in terms of principal, with $65 million issued at a 6.250% fixed coupon rate, also priced at par. The 2033 Notes, the longest-dated tranche, consisted of $2 million principal with a 6.500% coupon rate. All three series were priced at 100.000 percent of par value on the trade date.

The staggered maturity structure allows Prospect Capital to manage its liability profile across multiple periods. The interest payment dates for all three series are uniformly scheduled for January 15 and July 15 of each year, with the first coupon payment set for January 15, 2027. The 2029 Notes will deliver an initial coupon amount of $27.50 per $1,000 note, while the 2031 Notes will pay $28.65, and the 2033 Notes will pay $29.79 on their first coupon date. This graduated coupon structure reflects market pricing for securities with different duration profiles.

Gross Concessions and Net Proceeds from the Offering

The 2029 Notes tranche incurred gross concessions of 1.125 percent, resulting in net proceeds of $21.752 million from the $22 million principal offering. The 2031 Notes, the largest tranche, carried gross concessions of 1.700 percent, generating net proceeds of $63.895 million on $65 million in principal. The 2033 Notes, with a gross concession of 1.950 percent, produced net proceeds of $1.961 million on its $2 million principal amount. The combined net proceeds across all three tranches totaled approximately $87.608 million after accounting for all applicable concessions paid to the purchasing agent and dealers.

The variation in gross concession rates across the three tranches reflects the differentiated compensation structures typical in multi-tranche offerings, with longer-dated securities generally commanding higher dealer compensation relative to their principal amounts. The purchasing agent retained the ability to resell notes to agents and selected dealers at a concession that could be less than or equal to the gross concession received, providing flexibility in managing distribution channels. Notes sold to level-fee investment or advisory accounts were offered without additional dealer compensation retained beyond the stated concession structure.

Callable Structure and Redemption Provisions

All three series of InterNotes are redeemable at the option of Prospect Capital Corporation at par value of $1,000 per note beginning January 15, 2027, and on every business day thereafter. The company must provide between five and sixty days' prior written notice to noteholders and the trustee before exercising its redemption rights. Upon redemption, the company will pay the applicable redemption price of $1,000 per note plus accrued and unpaid interest for the then-current semi-annual interest period, calculated to but excluding the date fixed for redemption. This call feature provides the issuer with refinancing flexibility should market conditions or the company's financial position improve.

The early redemption capability commencing just six months after issuance allows Prospect Capital to manage its debt portfolio proactively. Should the company generate additional liquidity through asset sales or improved operating performance, management could elect to retire these obligations ahead of their stated maturity dates. The survivor's option included with all three note series provides an additional feature for certain registered noteholders, though the specific mechanics of this option are detailed in the underlying prospectus and indenture documents referenced in the offering materials.

Settlement and Trading Mechanics

The offering traded on July 27, 2026, at 12:00 PM Eastern Time, with settlement scheduled for July 30, 2026. All three note series carry a minimum denomination of $1,000 with increments available in $1,000 amounts. Initial trades settled on a flat basis and clear through the Depository Trust Company book-entry system without physical certificates, streamlining the settlement process and reducing operational friction. The notes are registered under an existing registration statement, specifically Registration Statement No. 333-293349, with this pricing supplement filed as Pricing Supplement No. 1691, 1692, and 1693 on July 27, 2026, under Securities Act Rule 424(b)(2).

The DTC book-entry structure ensures efficient ownership transfers and facilitates secondary market trading among institutional and individual investors. The notes will be governed by the Indenture dated February 16, 2012, as supplemented by the One Thousand Six Hundred Ninety-First, One Thousand Six Hundred Ninety-Second, and One Thousand Six Hundred Ninety-Third Supplemental Indentures dated July 30, 2026. U.S. Bank National Association serves as the indenture trustee, responsible for administering the terms and conditions of the notes and protecting the interests of noteholders throughout the life of the securities.

Recent Asset Divestiture and Capital Deployment Context

On July 1, 2026, just weeks before pricing this debt offering, Prospect Capital Corporation completed the sale of its investment in Valley Electric Company, Inc. for consideration of approximately $328.0 million, subject to net asset and other post-closing purchase price adjustments and potential earn-out payments. This significant transaction substantially enhanced the company's liquidity position and provided capital that could be deployed toward new investments, debt reduction, or operational needs. The timing of the InterNotes offering relative to this major divestiture suggests the company may be rebalancing its capital structure and funding strategy.

The Valley Electric sale represents a meaningful redeployment of Prospect Capital's invested capital. As a business development company specializing in middle-market, privately-held enterprises, the company regularly monetizes successful investments to generate returns for shareholders and redeploy capital into new opportunities. The approximate $328 million proceeds from this transaction provide substantial financial flexibility, and the concurrent InterNotes offering suggests management is strategically accessing capital markets to fund its operational and investment objectives. The company's externally-managed structure, with Prospect Capital Management L.P. overseeing investments and Prospect Administration LLC handling administrative operations, facilitates focused execution of the firm's investment strategy.

Prospect Capital's Business Model and Investment Focus

Prospect Capital Corporation operates as an externally-managed, non-diversified closed-end management investment company that has elected to be treated as a business development company under the Investment Company Act of 1940. The firm specializes in lending to and making equity investments in middle-market, privately-held companies, typically providing both debt and equity capital to support growth initiatives, management buyouts, and other corporate transactions. This sector-focused approach allows the company to develop specialized expertise and maintain closer relationships with borrowers and portfolio companies than might be possible in a diversified lending platform.

The BDC structure provides Prospect Capital with regulatory flexibility and favorable tax treatment, provided the company maintains compliance with applicable statutory requirements regarding diversification, leverage, and distribution policies. The combination of debt and equity investments in middle-market firms generates multiple revenue streams including interest income from debt investments, dividend income from equity holdings, and capital gains upon successful exit transactions. The Valley Electric sale exemplifies the type of value-creation outcome Prospect Capital targets, having held the investment through a period of operational improvement or market expansion that ultimately justified a substantial exit valuation.

Legal and Counsel Opinions on Note Validity

Russell Wininger, Deputy General Counsel, Legal of Prospect Administration, provided an opinion that the Note Certificates constitute valid and binding obligations of Prospect Capital Corporation, enforceable under New York law, subject to applicable bankruptcy and insolvency statutes affecting creditors' rights. This opinion, limited to New York law as in effect on the date of issuance, confirms that the notes possess all required legal characteristics to function as debt securities in the capital markets. The opinion expressly excludes any assessment regarding fraudulent conveyance or fraudulent transfer provisions, relying instead on standard creditor protections and equitable principles of general applicability.

Venable LLP, serving as Maryland counsel to the Company, provided an additional opinion confirming that the execution, delivery, and performance of the Indenture and the issuance of the Notes have been duly authorized by Prospect Capital under Maryland corporate law. This dual-counsel approach—with New York counsel addressing note enforceability and Maryland counsel addressing corporate authorization—provides noteholders with comprehensive legal coverage across the jurisdictions most relevant to the securities and the issuer. Both legal opinions are subject to customary assumptions, qualifications, and limitations stated in the underlying documentation and prior legal opinions filed with the Securities and Exchange Commission.

Risk Factors and Regulatory Disclosure Framework

The pricing supplement explicitly references the comprehensive Risk Factors section beginning on page 12 of the accompanying prospectus dated February 10, 2026, which details material risks associated with investment in these notes. Prospective investors are directed to review that section thoroughly before making investment decisions. The prospectus, prospectus supplement, and pricing supplement together constitute the complete disclosure document for these securities and should be read in their entirety. The company notes that neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved these securities or evaluated the adequacy or accuracy of the offering documents.

Prospect Capital Corporation maintains an active SEC reporting schedule, filing annual reports, quarterly reports, current reports, and proxy statements that provide ongoing transparency regarding the company's investments, financial performance, and material developments. These documents are available without charge through the SEC's EDGAR database at www.sec.gov and directly from the company. The prospectus explicitly disclaims any incorporation by reference of information contained on Prospect Capital's website, emphasizing that only formal regulatory filings and registered offering documents should be relied upon for investment decision-making purposes.

InterNotes Program and Market Access Strategy

The InterNotes program represents Prospect Capital's established framework for accessing capital markets through unsecured debt offerings registered under the company's shelf registration statement. InterNotes is a registered trademark of InspereX Holdings LLC, and the company has utilized this program to issue multiple tranches of debt securities across various maturity profiles and coupon structures. This program provides operational efficiency compared to establishing entirely new registration statements for each debt issuance, allowing management to access capital markets relatively quickly when strategic or financial conditions warrant additional borrowing.

By utilizing multiple tranches simultaneously, Prospect Capital achieved a more comprehensive market test of investor demand across different maturity horizons and pricing points. The presence of three different coupon rates—6.000 percent for three-year maturity, 6.250 percent for five-year maturity, and 6.500 percent for seven-year maturity—demonstrates a standard yield-curve relationship where longer-dated securities command higher coupon compensation. This market-standard structure likely facilitated efficient distribution and attracted a broad range of fixed-income investors with varying duration preferences and portfolio positioning requirements.