NSLR 10-K & 10-Q changes, risk factors and insider trading

Investing in our securities involves a number of significant risks. In addition to the other information contained in this annualAnnual reportReport on Form 10-K, 10-K for the fiscal year ended December 31, 2025, you should consider carefully the following information before making an investment in our securities. Although the risks described below represent the principal risks associated with an investment in us, they are not the only risks we face. Additional risks and uncertainties not presently known to us might also impair our operations and performance. If any of the following events occur, our business, financial condition condition and results of operations could be materially and adversely affected. In such case, our NAV and the trading price of our common stock stock could decline, and you may lose all or part of your investment.

A portfolio company’s failure to satisfy financial or operating covenants imposed by its lenders could lead to defaults and, potentially, termination of its loans and foreclosure on its assets, which could trigger cross-defaults under other agreements and jeopardize our investments in such portfolio company. In addition, borrowers may file for bankruptcy protection to stay foreclosure proceedings, which could delay our ability to enforce our rights. Deterioration in a portfolio company’s financial condition is often accompanied by a corresponding deterioration in the value of any collateral securing our investment. We may also incur significant expenses toin theconnection extentwith necessary to seekseeking recovery of our equity investment or to negotiatenegotiating new terms with a financially distressed portfolio company. Any or all of these events could negativelyhave impacta material adverse effect on our business, financial condition, or results of operations.

The IPO market is, by its very nature, unpredictable, and IPO activity in particular has slowed significantly in recent years, which trend may remain for the foreseeable future. A lack of IPO opportunities for venture capital-backed companies could lead to companies staying in our portfolio longer as private entities still requiring funding. If we need to dispose of certain investments to meet liquidity requirements or other operational needs, such investments may be sold for less than their potential value. This situation may adversely affect the amount of available venture capital funding to late-stage companies that cannot complete an IPO. Such stagnation could dampen our returns or could lead to unrealized depreciation and realized losses as some companies run short of cash and have to accept lower valuations in private fundings or are not able to access additional capital at all. A lack of IPO opportunities for venture capital-backed companies may also cause some venture capital firms to change their strategies, leading some of them to reduce funding to their portfolio companies and making it more difficult for such companies to access capital. This might result in unrealized depreciation and realized losses in such companies by other investment funds, like us, who are co-investors in such companies. There can be no assurance that we will be able to achieve our targeted return on our portfolio company investments if, as and when they go public.

In addition, even if a portfolio company completes an IPO, we willare typically not be ableunable to sell our position until any applicable post-IPO lock-up lock-up restriction expires. As a result of lock-up restrictions,result, the market price of securities that we hold may decline substantially before we are able to sell them following an IPO. There iscan alsobe no assurance that a meaningful trading market will develop for our publicly traded portfolio companies following an IPOIPO, towhich allowmay uslimit our ability to liquidate our positionpositions when wedesired. desire.The lack of liquidity in our investments may adversely affect our business, financial condition, and results of operations.

Given the experience of our executive officers and investment professionals within the technology space, a number of the companies in which we have invested and intend to invest operate in technology-related sectors, and as of December 31, 2024,2025, our largest industry concentrations of our total investments at fair value were in the artificial intelligence intelligence infrastructure & applications sector, which represented approximately 27.7%30.6% of our portfolio, and the software-as-a-serviceconsumer goods & services (“SaaS”) sector, which represented approximately 23.5%21.2% of our portfolio. Additionally, our investments in the consumersoftware-as-a-service goods(“SaaS”) & services sector represented approximately 14.5% of our portfolio, our investments in the educational technology sector represented approximately 13.1%19.8% of our portfolio, and our investments in the logisticseducational & supply chaintechnology sector represented approximately 11.0% 10.5% of our portfolio. Therefore, we are susceptible to the economic circumstances and market conditions in these industries, and a downturn in one or more of these industries could have a material adverse effect on our business and results of operations.

Our investment in the SaaS sector is subject to substantial risks. ForThe rapid example,emergence of AI-first companies and generative AI tools poses significant competitive threats to traditional SaaS business models. AI-native companies are increasingly launching vertical-specific applications that directly compete with established SaaS vendors, demonstrating how AI agents and autonomous AI systems could displace traditional business applications. Our portfolio companies may face margin pressure, customer churn, and declining recurring revenue if they fail to effectively integrate AI capabilities, differentiate their offerings from AI-native competitors, or adapt their technology platforms to meet evolving customer expectations for AI-powered functionality. The shifting technology landscape may require significant investment in research and development, product reimagination, and go-to-market strategy changes that our portfolio companies may be unable or unwilling to undertake. In addition, such portfolio companies may be subject to consumer protection laws that are enforced by regulators such as the Federal Trade Commission and private parties, and include statutes that regulate the collection and use of information for marketing purposes. Any new legislation or regulations regarding the Internet, mobile devices, software sales or export and/or the cloud or SaaS industry, and/or the application of existing laws and regulations to the Internet, mobile devices, software sales or export and/or the cloud or SaaS industry, could create new legal or regulatory burdens on these portfolio companies that could have a material adverse effect on their respective operations. In addition, ourOur SaaS portfolio companies may incur significant operating losses and negative cash flows during certain times of their respective life cycles, resulting in an adverse impact on their operations. Because our SaaS portfolio companies are generally investments that are underwritten and valued on “recurring revenue” rather than EBITDA, the fair value determinations of such companies are inherently uncertain and may fluctuate over short periods of time. They are also subject to the risks that their customers have financial difficulties that make them unable or unwilling to pay for the software and services that drive a portfolio company’s recurring revenue projections.projections or may switch to lower-cost AI-native alternatives that offer superior functionality or automation capabilities. For these reasons, our financial results could be materially adversely affected if our portfolio companies in the SaaS industry encounter financial difficulty.

While we invest primarily in U.S. companies, we may invest on an opportunistic basis in certain non-U.S. companies, including those located in emerging markets, that otherwise meet our investment criteria. In regardsregard to the regulatory requirements for BDCs, non-U.S. investments do not qualify as investments in “eligible portfolio companies,” and thus may not be considered “qualifying assets.” In addition, investing in foreign companies, and particularly those in emerging markets, may expose us to additional risks not typically associated with investing in U.S. issuers. These risks include changes in exchange control regulations, political and social instability, expropriation, imposition of foreign taxes, less liquid markets and less available information than is generally the case in the United States, higher transaction costs, less government supervision of exchanges, brokers and issuers, less developed bankruptcy laws, difficulty in enforcing contractual obligations, lack of uniform accounting and auditing standards and greater price volatility. Further, we may have difficulty enforcing our rights as equity holders in foreign jurisdictions. In addition, to the extent we invest in non-U.S. companies, we may face greater exposure to foreign economic developments.

From time to time, capital markets may experience periods of disruption and instability, including during portions of the last threerecent fiscal years. Since 2020, the U.S. capital markets have experienced extreme volatility and disruption. Despite actions of the U.S. federal government and foreign governments, these types of events contribute to unpredictable general economic conditions that materially and adversely impact the broader financial and credit markets and reduce the availability of debt and equity capital for the market as a whole. These conditions could continue for a prolonged period of time or worsen in the future.

Given the ongoing and dynamic nature of recent market disruption and instability, including ituncertainty with respect to, among other things, inflationary pressures, elevated interest rates, new tariffs and trade barriers,and geopolitical conditions, including the ongoing conflict between Russia and Ukraine, the ongoing conflicts in Europe and the Middle East, as well as the failure of major financial institutions,significant volatility has been introduced in the financial markets. The effect of this volatility has materially impacted and could continue to materially impact our market risks. It is difficult to predict the full impact of these conditions on our business. The extent of any such impact will depend on future developments, which are highly uncertain, including the duration or reoccurrence of any potential business or supply chain disruption, changes in interest rates and inflation rates, global conflicts, health epidemics and pandemics and the actions taken by governments in response to these conditions.

Volatility and dislocation in the capital markets can also create a challenging environment in which to raise or access debt capital, and our ability to incur indebtedness (including by issuing preferred stock) is limited by applicable regulations such that our asset coverage (as defined in the 1940 Act) must equal at least 200% (or 150% if certain requirements are met) immediately after each time we incur indebtedness. The continuance or reappearance of market conditions similar to those experienced during portions of the last threerecent fiscal years for any substantial length of time could make it difficult to extend the maturity of or refinance our existing indebtedness or obtain new indebtedness with similar terms and any failure to do so could have a material adverse effect on our business. The debt capital that will be available to us in the future, if at all, may be at a higher cost and on less favorable terms and conditions than what we currently experience, including being at a higher cost in rising rate environments. If we are unable to raise or refinance debt, then our equity investors may not benefit from the potential for increased returns on equity resulting from leverage and we may be limited in our ability to make new commitments or to fund existing commitments to our portfolio companies. An inability to extend the maturity of, or refinance, our existing indebtedness or obtain new indebtedness could have a material adverse effect on our business, financial condition or results of operations.

Significant volatility and disruption,disruption has had, and in the future may have, a negative effect on the valuations of our investments and on the potential for liquidity events involving these investments. While most of our investments are not publicly traded, applicable accounting standards require us to assume, as part of our valuation process, that our investments are sold in orderly mark-to-market transactions between market participants. As a result, volatility in the capital markets can adversely affect our investment valuations.

The U.S. Federal Reserve decreased the federal funds rate multiple times in 2024 afterFollowing a sustained period of historicallyelevated highinterest rates.rates implemented to address inflation concerns, the Federal Reserve commenced a cycle of interest rate reductions in late 2024, with the most recent cut occurring in the fourth quarter of 2025. The Feder Reserve has indicated that additional rate cuts may occur in the future; however, future reductions to benchmark rates are not certain. We may borrow money and issue debt securities or preferred stock to make investments, and if we do so, our net investment income will be dependent upon the difference between the rate at which we borrow funds or pay interest or dividends on such debt securities or preferred stock and the rate at which we invest these funds. While we are principally invested in the equity and equity-related securities of our portfolio companies, to the extent we have debt investments with floating rates, in periods of declining interest rates, we may earn less interest income from investments and our cost of funds will also decrease. Conversely,While a decrease in periodsinterest rates may reduce our borrowing costs, it could also reduce the portfolio yield on our floating-rate investments, thereby decreasing our net income. Conversely, any future increase in interest rates could decrease the value of risingany investments we hold which earn fixed interest rates,rates and could also increase our our interest incomeexpense, thereby decreasing our net income. Additionally, fluctuations in interest rates available to investors could make an investment in our common stock less attractive if we are not able to pay dividends at a level that provides a similar return, which could reduce the value of our common stock. Further, changes in interest rates could also adversely affect our performance if such changes cause our borrowing costs to rise at a rate in excess of the rate that our investments yield. It is possible that the Federal Reserve’s recent interest rate reductions could also result in increased inflation, which may necessitate a return to a more restrictive monetary policy or otherwise adversely affect the operating results of our portfolio companies, either of which could have a material adverse effect on theseour investmentsbusiness, will increase.results of operations and financial condition. 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.

In the past, instability in the global capital markets resulted in disruptions in liquidity in the debt capital markets, significant write-offs write-offs in the financial services sector, the re-pricing of credit risk in the broadly syndicated credit market and the failure of major domestic and international financial institutions. In particular, in past periods of instability, the financial services sector was negatively impacted by significant write-offs as the value of the assets held by financial firms declined, impairing their capital positions and abilities to lend and invest. In addition, continued uncertainty surrounding the negotiation ofinternational trade deals between the United Kingdom and the European Union following the United Kingdom’s exit from the European Union and tensions uncertainty between the United States and other countries, including China and Russia, with respect to trade policies, treaties, sanctions, and tariffs, among other factors, have caused disruption in the global markets. There can be no assurance that market conditions will not worsen in the future.

Certain of our portfolio companies may be impacted by inflation. If such portfolio companies are unable to pass any increases in their costs along to their customers, it could adversely affect their results, which could in turn adversely impact our results of operations. In In addition, any projected future decreases in our portfolio companies’ operating results due to inflation could adversely impact impact the fair value of our investments.investments particularly if interest rates rise in response to inflation. Any decreases in the fair value of our investments could result in future unrealized losses and therefore reduce our net assets resulting from operations. See “—We are exposed to risks associated with changes in interest rates.”

Conversely, “anti-ESG” sentiment has gained momentum across the U.S., with a growing number of states, federal agencies, the executive branch and Congress having enacted, proposed or indicated an intent to pursue “anti-ESG” policies, legislation or issued related legal opinions and engaged in related investigations and litigation. If investors subject to “anti-ESG” legislation view our investment activities as being in contradiction of such “anti-ESG” policies, legislation or legal opinions, such investors may not invest in us and it could negatively impact the price of our common stock. In addition, corporate diversity, equity and inclusion (“DEI”) practices have recently come under increasing scrutiny. For example, some advocacy groups and federal and state officials have asserted that the U.S. Supreme Court’s decision striking down race-based affirmative action in higher education in June 2023 should be analogized to private employment matters and private contract matters and several media campaigns and cases alleging discrimination based on such arguments have been initiated since the decision. Additionally, in January 2025, President Trump signed a number of Executive Orders focused on DEI, which indicate continued scrutiny of DEI initiatives and potential related investigations of certain private entities with respect to DEI initiatives, including publicly traded companies. If we do not successfully manage expectations across varied stakeholder interests, it could erode stakeholder trust, impact our reputation and constrain our investment opportunities. Such scrutiny of both ESG and DEI related practices could expose our investment adviserus to the risk of litigation, investigations or challenges by federal or state authorities or result in reputational harm.

There is also regulatory interest across jurisdictions in improving transparency regarding the definition, measurement and disclosure of ESG factors in order to allow investors to validate and better understand sustainability claims. For example, the SEC sometimes sometimes reviews compliance with ESG commitments in examinations and has taken enforcement actions against registered investment advisers for for not establishing adequate or consistently implementing ESG policies and procedures to meet ESG commitments to investors. In March 2024, the SEC adopted rules aimed at enhancing and standardizing climate-related disclosures; however, these rules are stayed pending the outcome of consolidated legal challenges in the Eighth Circuit Court of Appeals. At the state level, in October 2023, California enacted legislation (Senate Bills 253 and 261) that will ultimatelywould require certain companies that do business in California to publicly disclose their Scopes 1, 2, and 3 greenhouse gas emissions, with third party assurance of such data, and issue public reports on their climate-related financial risk and related mitigation measures. As of November 2025, the Ninth Circuit Court of Appeals has granted a temporary injunction of SB 261 (requiring climate-related financial risk reporting), while SB 253 (requiring greenhouse gas emissions disclosure) remains in force with initial compliance deadlines anticipated in 2026, subject to ongoing legal challenges. Compliance with any of these new laws or regulations increasescould increase our regulatory burden and could result in increased legal, accounting and compliance costs, make some activities more difficult, time-consuming and costly, affect the manner in which we or our portfolio companies conduct our businesses and adversely affect our profitability.

Under the provisions of the 1940 Act, we are permitted, as a BDC, to issue senior securities only in amounts such that our asset coverage ratio equals at least 200% after each issuance of senior securities (or 150% if certain requirements are metsatisfied). after each issuance of senior securities. If the value of our assets declines, we may be unable to satisfy this test and we may be required to sell a portion of our investments and, depending on the nature of our leverage, repay a portion of our senior securities at a time when such sales may be disadvantageous.

We may in the future issue additional debt securities or preferred stock and/or borrow money from banks or other financial institutions, institutions, which we refer to collectively (along with the 6.00% Notes due 2026 and the 6.50% Convertible Notes due 2029) as “senior securities,” up to the maximum amount permitted by the 1940 Act. Under the provisions of the 1940 Act, we are permitted, as a BDC, to issue senior securities in amounts such that our asset coverage ratio, as defined in the 1940 Act, equals at least 200% (or 150% if certain conditions requirements are metsatisfied) of gross assets less all liabilities and indebtedness not represented by senior securities, after each issuance of senior securities. If the value of our assets declines, we may be unable to satisfy this test. If that happens, we may be required to sell a portion of our investments and, depending on the nature of our leverage, repay a portion of our indebtedness at a time when such sales may be disadvantageous. Furthermore, any amounts that we use to service our indebtedness would not be available for distributions to our common stockholders.

We have elected to be taxed for U.S. federal income tax purposes as a RIC under Subchapter M of the Code. If we meet certain requirements, requirements, including source of income, asset diversification and distribution requirements, and if we continue to operate as a BDC, we will continue to qualify for tax treatment as a RIC under the Code and will not be subject to U.S. income taxes on income we distribute to our stockholders as dividends, allowing us to substantially reduce or eliminate our U.S. federal income tax liability. As a BDC, we are generally required to meet a coverage ratio of total assets to total senior securities, which includes all of our borrowings and any preferred stock we may issue in the future, of at least 200% (or 150% if certain requirementsconditions are metsatisfied) at the time we issue any debt or preferred stock. This requirement limits the amount that we may borrow. Because we will continue to need capital to grow our investment portfolio, this limitation may prevent us from incurring debt or issuing preferred stock and require us to raise additional equity at a time when it may be disadvantageous to do so. We cannot assure you that debt and equity financing will be available to us on favorable terms, or at all, and debt financings may be restricted by the terms of any of our outstanding borrowings. In addition, as a BDC, we are generally not permitted to issue common stock priced below NAV without stockholder approval. If additional funds are not available to us, we could be forced to curtail or cease new lending and investment activities, and our NAV could decline.

On or after December 30, 2024, weWe may choose to redeem the 6.00% Notes due 2026 from time to time, especially if prevailing interest rates are lower than the rate borne by the 6.00% Notes due 2026. If prevailing rates are lower at the time of redemption, and we redeem the 6.00% Notes due 2026, a holder likely would not be able to reinvest the redemption proceeds in a comparable security at an effective interest rate as high as the interest rate on the 6.00% Notes due 2026 being redeemed. Our redemption right also may adversely impact impact a holder’s ability to sell the 6.00% Notes due 2026 as the optional redemption date or period approaches.

The possibility possibility that our shares will trade at a discount from NAV or at premiums that are unsustainable are risks separate and distinct from the risk that our NAV per share will decrease. The risk of purchasing shares of a BDC that might trade at a discount or unsustainable premium premium is more pronounced for investors who wish to sell their shares in a relatively short period of time because, for those investors, realization realization of a gain or loss on their investments is likely to be more dependent upon changes in premium or discount levels than upon increases increases or decreases in NAV per share. As of March 11,10, 2025,2026, the closing price of our common stock on the Nasdaq Global Select Market was $5.27$9.68 per share, which represented an approximately 21.1%19.7% discountpremium to our NAV of $6.68$8.09 per share as of December 31, 2024.2025.

Concerns about U.S. fiscal policy, including federal debt levels, budget deficits, and recurring debates over the debt ceiling, could cause interest rates and borrowing costs to rise, which may negatively impact both the perception of credit risk associated with our debt portfolio and our ability to access the debt markets on favorable terms. Downgrades by rating agencies to the U.S. government’s credit rating or concerns about its credit and deficit levels in general could cause interest rates and borrowing costs to rise, which may negatively impact both the perception of credit risk associated with our debt portfolio and our ability to access the debt markets on favorable terms. In addition, a decreased U.S. government credit ratingcreditworthiness could create broader financial turmoil and uncertainty, which may weigh heavily on our financial performance and the value of our common stock.

Deterioration in theGlobal economic conditions in the Eurozone and othergeopolitical regions or countries globally and the resulting instability in global financial markets maytensions pose aongoing risk risks to our business.business and portfolio companies. Financial markets have been affected at times by a number of global macroeconomic events,factors, including: geopolitical conflicts such as the following:Russia-Ukraine large sovereign debtswar and fiscalongoing deficits of several countriestensions in Europethe Middle East; instability in global energy and commodity markets; persistent inflationary pressures and central bank policy responses; economic slowdowns in major economies including China and the European Union; sovereign debt concerns in emerging markets; jurisdictions,periodic levelsbanking sector stress and liquidity events; and the lingering structural impacts of non-performingprior loansglobal ondisruptions. While the balanceacute sheets of European banks, the effectphase of the UnitedCOVID-19 Kingdompandemic leavinghas thepassed, Europeanresidual Union,effects instabilityon supply chains, labor markets, in the Chinese capital markets and bankbusiness failures.operations continue to affect certain sectors. Global market and economic disruptions have affected, and may in the future affect, affect, the U.S. capital markets, which could adversely affect our business, financial condition or results of operations. We cannot assure you that market disruptions in Europe and other regions or countries, including the increased cost of funding for certain governments and financial institutions, will not impact the global economy, and we cannot assure you that government assistance packages or central bank interventions will be available,available or if available, be sufficient to stabilize countries and markets in Europe or elsewhere affected by a financial crisis.or economic crises. To the extent uncertainty regarding anythat economic recoveryuncertainty, ingeopolitical Europeinstability, or elsewherepolicy changes negatively impactsimpact consumer confidence, confidencebusiness and consumerinvestment, credit factors,availability, or capital markets functioning, our and our portfolio companies’ business, financial condition and results of operations could be significantly and adversely affected. Moreover, there is a risk of both sector-specific and broad-based corrections and/or downturns in the equity and credit markets. Any of the foregoing could have a significant impact on the markets in which we operate and could have a material adverse impact on our business prospects and financial condition.

The TrumpChanges Administrationin haspresidential administrations have called for significant changes to U.S. trade, healthcare, immigration, foreign and government regulatory policy. Following the 2024 presidential election and transition Into thisa regard,new administration in January 2025, there is significant uncertainty with respect to legislation, regulation and government policy at the federal level, as well as the state and local levels. RecentPolicy eventsshifts associated with changes in administrations have created a climate of heightened uncertainty and introduced new and difficult-to-quantify macroeconomic economic and political risks with potentially far-reaching implications. There has been a corresponding meaningful increase in the uncertainty surrounding interest rates, inflation, foreign exchange rates, trade volumes and fiscal and monetary policy. To the extent the U.S. Congress or the current administration implements changes to U.S. policy, those changes may impact, among other things, the U.S. and global economy, international trade and relations, unemployment, immigration, corporate taxes, healthcare, the U.S. regulatory environment, inflation and other areas. For example, the current administration has announced or implemented policies affecting tariffs, trade relationships, federal agency operations, DEI initiatives, environmental regulations, and financial services oversight, which may affect our business and portfolio companies.

A particular area identified as subject to potential change, amendment or repeal includes the Dodd-Frank Act, including the Volcker Rule and various swaps and derivatives regulations, credit risk retention requirements and the authorities of the Federal Reserve, the Financial Stability Oversight Council and the SEC. Additionally, changes to the structure, funding, or priorities of federal regulatory agencies, including the SEC, could affect the regulatory environment in which we operate. Given the uncertainty associated with the manner in which and whether the provisions of the Dodd-Frank Act will be implemented, repealed, amended, or replaced, the full impact such requirements will have on our business, results of operations or financial condition is unclear. The changes resulting from the Dodd-Frank Act or any changes to the regulations already implemented thereunder may require us to invest significant management attention and resources to evaluate and make necessary changes in order to comply with new statutory and regulatory requirements. Failure to comply with any such laws, regulations or principles, or changes thereto, may negatively impact our business, results of operations or financial condition. While we cannot predict what effect any changes in the laws or regulations or their interpretations would have on us as a result of recent financial reform legislation, legislation or future policy changes, these changes could be materially adverse to us and our stockholders.

Cybersecurity incidents and cyber-attacks have been occurring globally at a more frequent and severe level, and will likely continue to increase in frequency in the future. The rapid evolution and scale of artificial intelligence technologies also may increase the likelihood or effectiveness of cyber-attacks. The occurrence of a disaster, such as a cyber-attack against us or against a third party that has access to our data or networks, a natural catastrophe, an industrial accident, failure of our disaster recovery systems, or consequential employee error, could have an adverse effect on our ability to communicate or conduct business, negatively impacting our operations and financial condition. This adverse effect can become particularly acute if those events affect our electronic data processing, transmission, storage, and retrieval systems, or impact the availability, integrity, or confidentiality of our data.

We depend heavily upon computer systems to perform necessary business functions. Despite our implementation of a variety of security measures, our computer systems could be subject to cyber-attacks and unauthorized access, such as physical and electronic break-ins or unauthorized tampering.access. Like other companies, we may experience threats to our data and systems,systems including malware and computer virus attacks, unauthorized access, system failures and disruptions. If one or more of these events occurs, itthat could potentially jeopardize the confidential, proprietary and other information processed and stored in, and transmitted through, our computer systems and networks, or otherwise cause interruptions or malfunctions in our operations, which could result in damage to our reputation, financial losses, litigation, increased costs, regulatory penalties and/or customer dissatisfaction or loss, reputational damage, and increased costs associated with mitigation of damages and remediation. If unauthorized parties gain access to such information and technology systems, they may be able to steal, publish, delete or modify private and sensitive information, including nonpublic personal information related to stockholders (and their beneficial owners) and material non-public information.operations. The systems we have implemented to manage cybersecurity risks relating to these types of events could prove to be inadequate and, if compromised, could become inoperable for extended periods of time, cease to function properly or fail to adequately secure private information. Breaches such as those involving covertly introduced malware, impersonation of authorized users and industrial or other espionage may not be identified even with sophisticated prevention and detection systems, potentially resulting in further harm and preventing them from being addressed appropriately. The failure of these systems or of disaster recovery plans for any reason could cause significant interruptions in our operations and result in a failure to maintain the security, confidentiality or privacy of sensitive data, including personal information relating to stockholders, material non-public information and other sensitive information in our possession.data.

We are an internally managed, non-diversified closed-end management investment company that has elected to be regulated as a business development company (“BDC”) under the Investment Company Act of 1940, as amended (the “1940 Act,Act”), and has elected to be treated, and intends to qualify annually, as a regulated investment company (“RIC”) under Subchapter M of the Code.Internal Revenue Code of 1986, as amended (the “Code”).

Our investment objective is to maximize our portfolio’s total return, principally by seeking capital gains on our equity and equity-related investments, and to a lesser extent, income from debt investments. We invest principally in the equity securities of what we believe to be rapidly growing venture capital-backed emerging companies. We acquire our investments through direct investments in prospective portfolio companies, secondary marketplaces for private companies, negotiations with selling stockholders, and through investments in special purpose vehicles (“SPVs”) and investment funds that invest directly in the equity or debt of a single private issuer. In addition, we may invest in private credit and in the founders equity, founders warrants, venture capital investment funds, and private investment in public equity (“PIPE”) transactions of SPACs.special purpose acquisition companies (“SPACs”). We may also invest on an opportunistic basis in select publicly traded equity securities or certain non-U.S. companies that otherwise meet our investment criteria, subject to applicable requirements of the 1940 Act. To the extent we make investments insecurities, private equity funds and hedge funds that are excluded from the definition of “investment company” under the 1940 Act by Section 3(c)(1) or 3(c)(7) of the 1940 Act, weor willcertain non-U.S. limitcompanies suchthat investmentsotherwise meet our investment criteria, subject to noapplicable more than 15%requirements of ourthe net1940 assets.Act.

Our investment philosophy is based on a disciplined approach of identifying promising investments in high-growth, venture-backed companies across several key industry themes which may include, among others, Software-as-a-Service, Artificial Intelligence Infrastructure & Applications, Consumer Goods & Services, Education Technology, Logistics & Supply Chain,Software-as-a-Service, Financial Technology & Services, and SuRo Sports.Logistics & Supply Chain. Our investment decisions are based on a disciplined analysis of available information regarding each potential portfolio portfolio company’s business operations, focusing on the portfolio company’s growth potential, the quality of recurring revenues, revenues, and path to profitability, as well as an understanding of key market fundamentals. Venture capital funds or other institutional institutional investors have invested in the vast majority of companies we evaluate.

On and effective March 12, 2019, our Board of Directors approved our Internalization, and we began operating as an internally managed non-diversified closed-end management investment company that has elected to be regulated as a BDC under the 1940 Act. Our Board of Directors approved the Internalization in order to better align the interests of our stockholders with its management. As an internally managed BDC, we are managed by our employees, rather than the employees of an external investment adviser, thereby allowing for greater transparency to stockholders through robust disclosure regarding our compensation structure.adviser. As a result of the Internalization, we no longer pay any fees or expenses under an investment advisory agreement or administration agreement, and instead pay the operating costs associated with employing investment management professionals including, without limitation, compensation expenses related to salaries, discretionary discretionary bonuses and restricted stock grants.

Net Realized Gain/(Loss) on Investments

For the year ended December 31, 2025, we had a net change in unrealized appreciation/(depreciation) of $32,114,638. For the year ended December 31, 2024, we had a net change in unrealized appreciation/(depreciation) of $(18,968,978). For the year ended December 31, 2023, we had a net change in unrealized appreciation/(depreciation) of $30,453,935. For the year ended December 31, 2022, we had a net change in unrealized appreciation/(depreciation) of $(111,563,592).$30,453,935. The following tables summarize, by portfolio company, the significant changes in unrealized appreciation/(depreciation) of our investment portfolio for the years ended December 31, 2025, 2024, 2023, and 2022.2023.

Our liquidity and capital resources are generated primarily from the sales of our investmentsinvestments, recent private convertible debt issuances, and the net proceeds from public offerings of our equity and debt securities, including pursuant to our continuous at-the-market offering of shares of our common stock as discussed discussed below under “Equity Issuances and Debt Capital Activities — At-the-Market Offering”. InOn addition, on December 17, 2021, we issued $75.0 million aggregate principal amount of our 6.00% Notes due 2026,2026 (the “6.00% Notes due 2026”), of which $44.7$35.8 million remain remain outstanding,outstanding andas of December 31, 2025. In addition, on August 14, 2024 and October 9, 2024, we issued $25.0 million and $5.0 million, respectively, in aggregate principal amount of 6.50% Convertible Notes due 2029, and on October 9, 2024 and January 16, 2025, we issued $5.0 million and $5.0 million, respectively, in aggregate principal amount of the Additional Notes (as defined below), all of which remain outstanding. For additional information, see see“Equity Issuances and Debt Capital Activities—6.50% Convertible Notes due 2029” below and “Note 10—Debt Capital Activities” to our Consolidated Financial Statements as of December 31, 2024.2025.

Our primary uses of cash are to make investments, pay our operating expenses, and make distributions to our stockholders. For the yearyears ended December 31, 2024,2025, December 31, 20232024 and December 31, 2022,2023, our operating expenses, including interest payments on our debt obligations, were $18,624,714,$18,194,942, $20,036,389$18,624,714 and $18,164,201, $20,036,389, respectively.

During the yearyears ended December 31, 2025 and 2024, we did not repurchase any shares of our common stock under the discretionary open-market Share Repurchase Program. During the year ended December 31, 2023, we repurchased 186,493 shares of our common stock under the Share Repurchase Program. As of December 31, 2024,2025, the dollar value of shares that remained available to be purchased under the Share Repurchase Program wasis approximately $25.0 million. On October 29, 2024, our Board of Directors authorized an extension of, and an increase inCurrently, the amount of shares of our common stock that may be repurchased under the discretionary Share Repurchase Program is authorized until the earlier of (i) October 31, 2025 2026 or (ii) the repurchase of $64.3 million in aggregate amount of our common stock.

Under the Share Repurchase Program, we may repurchase our outstanding common stock in the open market, provided that we comply with the prohibitions under our insider trading policies and procedures and the applicable provisions of the 1940 Act and the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the rules promulgated thereunder. For more information on the Share Repurchase Program, see “Note 5—Common Stock” to our Consolidated Financial Statements as of December 31, 2024.2025.

As of December 31, 2025 and 2024, we had no off-balance sheet arrangements, including any risk management of commodity pricing or other hedging practices. However, we may employ hedging and other risk management techniques in the future.

During the yearsyear ended December 31, 20242025, andthe 2023,Company wesold 1,237,579 Shares under the ATM Program. During the year ended December 31, 2024, the Company did not issue or sell Shares under the ATM Program. As of December 31, 2024,2025, up to approximately $98.8$87.9 million in aggregate amount of the Shares remain available for sale under the ATM Program.

On August 6, 2024, our Board of Directors approved a discretionary note repurchase program (the “Note Repurchase Program”) which allows us to repurchase up to 46.67%, or $35.0 million in aggregate principal amount, of our 6.00% Notes due 2026 through open market purchases, including block purchases, in such manner as will comply with the provisions of the 1940 Act and the Exchange Act. During the year ended December 31, 2024, wethe Company repurchased and retired $30.3 million of aggregate principal amount of the 6.00% Notes due 2026. On October 29, 2025, our Board of Directors approved an extension of the discretionary note repurchase program (the “Note Repurchase Program”), which allows us to repurchase up to an additional $40.0 million or the remaining aggregate principal amount, of our 6.00% Notes due 2026 through open market purchases, including block purchases, in such manner as will comply with the provisions of the 1940 Act and the Exchange Act. During the year ended December 31, 2025, the Company repurchased and retired $8.8 million of aggregate principal amount of the 6.00% Notes due 2026. As of December 31, 2024,2025, the aggregate principal dollar amount of 6.00% Notes due 2026 that remained available to be purchased under the Note Repurchase Program was approximately $5.0$35.8 million.

On August 14, 2024, we issued $25.0 million aggregate principal amount of the 6.50% Convertible Notes due 2029 to a private purchaser (the “Purchaser”), which bear interest at a rate of 6.50% per year, payable quarterly in arrears on March 30, June 30, September 30, and December 30 of each year, commencing on September 30, 2024. We received $24.3 million in proceeds from the issuance, net of underwriting discounts and commissions. Under the purchase agreement governing the 6.50% Convertible Notes due 20292029, as Amended and Restated on December 12, 2025 (the “Notes Purchase Agreement”), upon mutual agreement between the Company and the Purchaser, we may issue additional 6.50% Convertible Notes due 2029 for sale in subsequent offerings to the Purchaser (the “Additional Notes”), or issue additional notes with modified pricing terms (the “New Notes”), in the aggregate for both the Additional Notes and the New Notes, up to a maximum of $50.0 million in one or more private offerings. Pursuant to the Notes Purchase Agreement, on October 9, 2024, we issued $5.0 million of Additional Notes to the Purchaser, and on January 16, 2025, we issued an additional $5.0 million of Additional Notes to the Purchaser, which Additional Notes are treated as a single series with the initial issuance of the 6.50% Convertible Notes due 2029. The 6.50% Convertible Notes due 2029 mature on August 14, 2029, unless previously repurchased, redeemed or converted in accordance with their terms. We do not have the right to redeem the 6.50% Convertible Notes due 2029 prior to August 6, 2027.

Refer to “Part II. Item 7—Recent Developments” and “Note 10—Debt Capital Activities” to our Consolidated Financial Statements as of December 31, 20242025 for more information regarding the 6.50% Convertible Notes due 2029.

Commissions and other costs associated with an investment transaction, including legal expenses not reimbursed by the portfolio company, are included in the cost basis of purchases and deducted from the proceeds of sales. We make certain acquisitions on secondary markets, which may involve making deposits to escrow accounts until certain conditions are met, including the underlying private company’s right of first refusal. If the underlying private company does not exercise or assign its right of first refusal and all other conditions are met, then the funds in the escrow account are delivered to the seller and the account is closed. Such transactions would be reflected on the Consolidated Statement of Assets and Liabilities as escrow deposits. As of December 31, 20242025 and December 31, 2023,2024, we had no escrow deposits.

Investing in our securities involves a number of significant risks. In addition to the other information contained in this report, you should carefully consider the factors discussed in our annual report on Form 10-K for the fiscal year ended December 31, 2025, filed with the SEC on March 11, 2026, which could materially affect our business, financial condition and/or operating results. Although the risks described in our annual report on Form 10-K for the fiscal year ended December 31, 2025 represent the principal risks associated with an investment in us, they are not the only risks we face. Additional risks and uncertainties not currently known to us, or that we currently deem to be immaterial, might materially and adversely affect our business, financial condition and/or operating results. ThereOther than as stated below, there have been no material changes to the risk factors discussed in “Item 1A. Risk Factors” of Part I of our annual report report on Form 10-K for the fiscal year ended December 31, 2025.

We are an internallyexternally managed, non-diversified closed-end management investment company that has elected to be regulated as a business development company (“BDC”) under the Investment Company Act of 1940, as amended (the “1940 Act”), and has elected to be treated, and intends to qualify annually, as a regulated investment company (“RIC”) under Subchapter M of the Internal Revenue Code of 1986, as amended (the “Code”). Effective July 15, 2026, we are externally managed by Neostellar Advisors LLC (the “Adviser”), which sources, evaluates and monitors our investments subject to the oversight of our Board of Directors, and we pay the Adviser a base management fee and an incentive fee and reimburse the Administrator for certain expenses.

We formed in 2010 as a Maryland corporation andand, operateuntil July 15, 2026, operated as an internally managed, non-diversified closed-end management investment company. Our investment activities arewere supervised by our Board of Directors and managed by our executive officers and investmentsinvestment professionals, all of whichwhom arewere our employees.

On and effective March 12, 2019, our Board of Directors approved our Internalization, and we began operating as an internally managed non-diversified closed-end management investment company that has elected to be regulated as a BDC under the 1940 Act. Our Board of Directors approved the Internalization in order to better align the interests of our stockholders with its management. As an internally managed BDC, we arewere managed by our employees, rather than the employees of an external investment adviser. AsOn June 10, 2026, our stockholders approved a result of the Internalization, we no longer pay any fees or expenses under annew investment advisory agreement orand, effective July 15, 2026, we transitioned to an externally managed BDC managed by Neostellar Advisors LLC and changed our name to “Neostellar Capital Corp.” As an externally managed BDC, our investment activities are managed by the Adviser, and we no longer have employees. Following the Externalization, we pay a base management fee, an incentive fee and administration agreement,expense and instead pay the operating costs associated with employing investment management professionals including, without limitation, compensation expenses related to salaries, discretionary bonuses and restricted stock grants.reimbursements.

ThreeSix Months Ended MarchJune 31,30, 2026

The value of our investment portfolio will change over time due to changes in the fair value of our underlying investments, as well as changes in the composition of our portfolio resulting from purchases of new and follow-on investments and the sales of existing investments. The fair value as of MarchJune 31,30, 2026 of all of our portfolio investments was $388,534,651.$405,851,701.

During the threesix months ended MarchJune 31,30, 2026, we funded investments in an aggregate amount of $5,000,000$29,696,170 (not including capitalized transaction costs) as shown in the following table:

During the threesix months ended MarchJune 31,30, 2026, we capitalized fees of $12,250.$124,628.

During the threesix months ended MarchJune 31,30, 2026, we exited or received proceeds from investments in the amount of $1,603,659,$13,746,165, net of transaction costs, and realized a net gain on investments of $890,513$5,940,033 (including adjustments to amounts held in escrow receivable) as shown in the following table:

ThreeSix Months Ended MarchJune 31,30, 2025

The value of our investment portfolio will change over time due to changes in the fair value of our underlying investments, as well as changes in the composition of our portfolio resulting from purchases of new and follow-on investments and the sales of existing investments. The fair value as of MarchJune 31,30, 2025 of all of our portfolio investments was $213,577,198.$243,798,547.

During the threesix months ended MarchJune 31,30, 2025, we funded investments in an aggregate amount of $1,303,010$6,302,884 (not including capitalized transaction costs) as shown in the following table:

During the threesix months ended MarchJune 31,30, 2025, we capitalized fees of $4,568.$400,237.

During the threesix months ended MarchJune 31,30, 2025, we did not exitexited or receivereceived proceeds from anyinvestments in the amount of our$41,251,774, investments,net of transaction costs, and realized a net lossgain on investments of $17,951$21,194,660 (including adjustments to amounts held in escrow receivable). as shown in following table:

Comparison of the Threethree Monthsand Endedsix Marchmonths 31,ended June 30, 2026 and 2025

Operating results for the three and six months ended MarchJune 31,30, 2026 and 2025:

Investment income increased to $731,963$299,650 for the three months ended March 31,June 30, 2026 from $499,094$167,304 for the three months ended MarchJune 31,30, 2025. The net increase between periods was primarily due to an increase in interest income received on cash,cash and an increase in interest accruals on our investment in the Supplying Demand, Inc. (d/b/a Liquid Death) Convertible Note, and an increase in dividend income from Treehouse Real Estate Investment Trust, Inc. The increases were offset by the cessation of dividend income from CW Opportunity 2 LP during the three months ended March 31, 2026, relative to the three months ended March 31, 2025.Note.

Total operating expenses increased to $4,710,455$23,654,334 for the three months ended MarchJune 31,30, 2026 from $4,160,863$3,889,464 for the three months ended June March 31,30, 2025. The increase in operating expenses was primarily due to increasesan increase in compensation expense,expense associated with the Externalization, including the acceleration of stock-based compensation expense and tax obligations associated with the vesting of equity awards. The increase was also attributable to higher professional fees, income tax expense, directors’ fees, and other expenses. These increases wereexpenses, partially offset by a decrease in interest expense during the three months ended MarchJune 31,30, 2026, relative to the three months ended MarchJune 31,30, 2025.

For the three months ended MarchJune 31,30, 2026, we recognized a net investment loss of $3,978,492,$23,354,684, compared to a net investment loss of $3,661,769$3,722,160 for the three months ended MarchJune 31,30, 2025. The change between periods resulted from an increase in operating expenses, partially offset by an increase in total investment income, during the three months ended MarchJune 31,30, 2026, relative to the three months ended MarchJune 31, 30, 2025.

For the three months ended MarchJune 31,30, 2026, we recognized a net realized gain on our investments of $890,513,$5,049,520, compared to a net realized gain loss of $17,951$21,212,611 for the three months ended MarchJune 31,30, 2025. The components of our net realized gains or losses on portfolio investments for for the three months ended MarchJune 31,30, 2026 and 2025, excluding short-term U.S. Treasury bills, are reflected in the tables above, under “—Portfolio and Investment Activity.”

For the three months ended MarchJune 31,30, 2026, we had a net change in unrealized appreciation/(depreciation) of $158,724,039.$(398,509). For the three months ended MarchJune 31,30, 2025, we had a net change in unrealized appreciation/(depreciation) of $2,888,878.$44,837,619. The following table summarizes, by portfolio company, the significant changes in unrealized appreciation/(depreciation) of our investment portfolio for the three months ended MarchJune 31,30, 2026 and 2025.

Our liquidity and capital resources are generated primarily from the sales of our investments, recent private convertible debt issuances, issuances, and the net proceeds from public offerings of our equity and debt securities, including pursuant to our continuous at-the-market offering of shares of our common stock as discussed below under “Equity Issuances and Debt Capital Activities—At-the-Market Offering”. On December 17, 2021, we issued $75.0 million aggregate principal amount of our 6.00% Notes due 2026 (the “6.00% Notes due 2026”), of which $35.8 million remain outstanding as of MarchJune 31,30, 2026. In addition, on August 14, 2024, we issued $25.0 million in aggregate principal amount of 6.50% Convertible Notes due 2029, and on October 9, 2024 and January 16, 2025, we issued $5.0 million and $5.0 million, respectively, in aggregate principal amount of the Additional Notes (as defined below),. allOn July 30, 2026, we filed a shelf registration statement on Form N-2 with the SEC covering up to $500.0 million of our common stock, preferred stock, subscription rights, debt securities and warrants, which remainhad outstanding.not been declared effective as of the date of this quarterly report. For additional information, see “Equity Issuances and Debt Capital Activities—6.50% Convertible Notes due 2029” and “Equity Issuances and Debt Capital Activities—Shelf Registration Statement” below and “Note 10—Debt Capital Activities” and “Note 12—Subsequent Events” to our Condensed Consolidated Financial Statements as of MarchJune 31,30, 2026.

Our primary uses of cash are to make investments, pay our operating expenses, and make distributions to our stockholders. For the threesix months ended MarchJune 31,30, 2026 and 2025 our operating expenses, including interest payments on our debt obligations, were $4,710,455$28,364,789 and $4,160,863,$8,050,327, respectively.

As of MarchJune 31,30, 2026, $35.8 million in aggregate principal of our 6.00% Notes due 2026 remained outstanding, with a maturity date of December 30, 2026. We have the right to redeem the 6.00% Notes due 2026, in whole or in part, at any time at a redemption price of 100% of the outstanding principal amount plus accrued and unpaid interest. We may also continue to repurchase the 6.00% Notes due 2026 in the open open market under the Note Repurchase Program, which was extended by our Board of Directors on October 29, 2025 and authorizes us to repurchase up to the remaining aggregate principal amount of the 6.00% Notes due 2026. We intendexpect to satisfy our repayment obligation at maturity primarilythrough a combination of available cash and proceeds from existingthe cashsale balances,of portfolio investments, and we may also consider refinancing alternatives, including the issuance of new debt securities, the sale of portfolio investments, or the issuance of equity under the ATM Program (under which approximately $87.9 million in aggregate amount of shares remained available for sale as of MarchJune 31,30, 2026)., in each case subject to the effectiveness of our shelf registration statement on Form N-2 filed on July 30, 2026. Any refinancing involving the incurrence of new indebtedness would require five business days’ prior written notice to the holder of our 6.50% Convertible Notes due 2029 pursuant to the Notes Purchase Agreement. As of MarchJune 31,30, 2026, we held approximately $43.3$12.9 million in cash, which exceeds the outstanding principal amount of the 6.00% Notes due 2026cash and which we believe is sufficient to satisfy this obligation at maturity. In addition, as of March 31, 2026, we held approximately $2.7$1.7 million of unrestricted securities of publicly traded portfolio companies that could provide an additional source of liquidity. We We will continue to evaluate our overall liquidity position and may take additional proactive steps, including the potential early redemption or open-market repurchase of some or all of the outstanding 6.00% Notes due 2026, to manage this near-term maturity.

During the threesix months ended MarchJune 31,30, 2026, cash decreased to $43,315,750$12,940,740 from $49,034,154 at the beginning of the year. The decrease in cash was primarily due to the purchase of new investments, payment of our operating expenses, including payment of compensation and payroll taxes related to the anticipated Externalization, and payment of interest on the 6.00% Notes due 2026 and 6.50% Convertible Notes due 2029. The decrease was offset by the increase in cash from the sale of public securities and investment income received.

A summary of our significant contractual payment obligations as of MarchJune 31,30, 2026 is as follows:

During the three and six months ended MarchJune 31,30, 2026,2026 and 2025, we did not repurchase any shares of our common stock under the discretionary open-market Share Repurchase Program. As of MarchJune 31,30, 2026, the dollar value of shares that remained available to be purchased under the Share Repurchase Program is approximately $25.0 million. Currently, the Share Repurchase Program is authorized until the earlier of (i) October 31, 2026 or (ii) the repurchase of $64.3 million in aggregate amount of our common stock.

Under the Share Repurchase Program, we may repurchase our outstanding common stock in the open market, provided that we comply with the prohibitions under our insider trading policies and procedures and the applicable provisions of the 1940 Act and the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the rules promulgated thereunder. For more information on the Share Repurchase Program, see “Note 5—Common Stock” to our Condensed Consolidated Financial Statements as of MarchJune 31,30, 2026.

As of MarchJune 31,30, 2026 and 2025, we had no off-balance sheet arrangements, including any risk management of commodity pricing or other hedging practices. However, we may employ hedging and other risk management techniques in the future.

During the threesix months ended MarchJune 31,30, 2026 and 2025, we did not issue or sell Shares under the ATM Program. As of MarchJune 31,30, 2026, up to approximately $87.9 million in aggregate amount of the Shares remain available for sale under the ATM Program.

Refer to “Note 5—Common Stock” to our Condensed Consolidated Financial Statements as of MarchJune 31,30, 2026 for more information information regarding the ATM Program.

On August 6, 2024, our Board of Directors approved a discretionary note repurchase program (the “Note Repurchase Program”) which allows us to repurchase up to $35.0 million of our 6.00% Notes due 2026 through open market purchases, including block purchases, in such manner as will comply with the provisions of the 1940 Act and the Exchange Act. During the year ended December 31, 2024, the Company repurchased and retired $30.3 million of aggregate principal amount of the 6.00% Notes due 2026. On October 29, 2025, our Board of Directors approved an extension of the discretionary note repurchase program (the “Note Repurchase Program”), which allows us to repurchase up to an additional $40.0 million or the remaining aggregate principal amount, of our 6.00% Notes due 2026 through open market purchases, including block purchases, in such manner as will comply with the provisions of the 1940 Act and the Exchange Act. During the year ended December 31, 2025, the Company repurchased and retired $8.8 million of aggregate principal amount of the 6.00% Notes due 2026. As of MarchJune 31,30, 2026, the aggregate principal dollar amount of 6.00% Notes due 2026 that remained available to be purchased under the Note Repurchase Repurchase Program was approximately $35.8 million.

Refer to “Note 10—Debt Capital Activities” to our Condensed Consolidated Financial Statements as of MarchJune 31,30, 2026 for more more information regarding the 6.00% Notes due 2026.

Refer to “Note 10—Debt Capital Activities” and “Note 12—Subsequent Events” to our Condensed Consolidated Consolidated Financial Statements as of MarchJune 31,30, 2026 for more information regarding the 6.50% Convertible Notes due 2029.

The timing and amount of our distributions, if any, will be determined by our Board of Directors and will be declared out of assets legally available for distribution. The following table lists the distributions, including dividends and returns of capital, if any, per share that we have declared since our formation through MarchJune 31,30, 2026. The table is divided by fiscal year according to record date:

So long as we qualify as a RIC, we generally will not be subject to U.S. federal and state income taxes on any ordinary income or capital gains that we distribute at least annually to our stockholders as dividends. To the extent all our ordinary income and capital gains are timely distributed to our stockholders as dividends, any tax liability related to income earned by the RIC will represent obligations of our investors and will not be reflected in our Condensed Consolidated Financial Statements. See “Note 2—Significant Accounting Policies—U.S. Federal and State Income Taxes” and “Note 9—Income Taxes” to our Condensed Consolidated Financial Statements as of MarchJune 31,30, 2026 for more information. The Taxable Subsidiaries included in our Condensed Consolidated Financial Statements are subject to U.S. federal income tax imposed at corporate rates on their income, regardless of whether we are taxed as a RIC. The Taxable Subsidiaries are not consolidated for U.S. federal income tax purposes and may generate income tax expenses as a result of their ownership of the portfolio companies. Such income tax expenses and deferred taxes, if any, will be reflected in our Condensed Condensed Consolidated Financial Statements.

Critical accounting policies and practices are the policies that are both most important to the portrayal of our financial condition and results, and require management’s most difficult, subjective, or complex judgments, often as a result of the need to make estimates about the effects of matters that are inherently uncertain. These include estimates of the fair value of our Level 3 investments and other estimates that affect the reported amounts of assets and liabilities as of the date of the Condensed Consolidated Financial Statements and the reported amounts of certain revenues and expenses during the reporting period. It is likely that changes in these estimates will occur in the near term. Our estimates are inherently subjective in nature and actual results could differ materially from such estimates. See “Note 2—Significant Accounting Policies” to our Condensed Consolidated Financial Statements as of MarchJune 31,30, 2026 for further detail regarding our critical accounting policies and recently issued or adopted accounting pronouncements.

See “Note 3—Related-Party Arrangements” to our Condensed Consolidated Financial Statements as of MarchJune 31,30, 2026 for more more information.

Please refer to “Note 12—Subsequent Events” to our Condensed Consolidated Financial Statements as of MarchJune 31,30, 2026 for details details regarding activity in our investment portfolio from AprilJuly 1, 2026 through MayAugust 5, 2026.

On April 2, 2026, our Board of Directors, including all of its independent directors, unanimously approved a proposal to transition us from an internally managed BDC to an externally managed structure (the “Externalization”) and approved the related investment advisory agreement (the “Advisory Agreement”) with Neostellar Advisors LLC (the “Adviser”), an entity jointly owned by certain of our currentthen-current employees and Magnetar Holdings LLC (“Magnetar”), pursuant to which the Adviser would be appointed as our investment adviser. Entry into the Advisory Agreement effectuating the Externalization iswas subject to approval by our stockholders. IfAt oura special meeting held on June 10, 2026, the Company’s stockholders do not approveapproved the Investment Advisory Agreement,Agreement with wethe willAdviser. continueAs toa operateresult, aseffective July 15, 2026 (the “Effective Date”), the Company transitioned from an internally managed BDC to an externally managed BDC.BDC We aremanaged notby beingthe sold,Adviser, and ifchanged theits Externalizationname isfrom consummated,“SuRo ourCapital stockholders immediately priorCorp.” to the“Neostellar Capital ExternalizationCorp.” will be our stockholders immediately following the Externalization and will hold the same number of shares of ourOur common stock continues asto theytrade held prior toon the Externalization.Nasdaq Global Select Market, now under the ticker symbol “NSLR.”

Key terms of the Externalization include: (i) no incentive fee payable to the Adviser on realized gains attributable to our existing portfolio; (ii) expected annual expense savings of approximately 0.77% of average total assets compared to theour currentformer internal management structure; (iii) a $20 million capitalinvestment commitmentin us by Magnetaran toaffiliate investof Magnetar, which was made on July 16, 2026 in us, the form of whicha willredeemable promissory depend on certain factorsnote; (iv) a base management fee of 1.75% of our gross assets, which our Board of Directors determined to be competitive with fees charged by comparable BDCs and below the median fee charged by private market venture and technology funds; and (v) management continuity, with our currentinvestment investment team, including Mark D. Klein and Allison Green, continuing in their current capacities, but as employees of the Adviser rather than us following the Externalization. Upon effectiveness ofOn the AdvisoryEffective Agreement,Date, we also will enterentered into an administration agreement (the “Administration Agreement”) with Neostellar Administrative Services LLC, an affiliate of the Adviser (the “Administrator”), pursuant to which the Administrator will provide,provides, or overseeoversees the provision of, administrative services necessary for our operations, subject to our reimbursement of the Administrator’s costs and expenses, including our allocable portion of overhead.

InOn June 12, 2026, following connectionapproval withof the Externalization,Externalization on April 2, 2026,by our Compensationstockholders, Committeewe approvedgranted (a) a grant of 350,000 restricted shares (with any aggregate income tax liability to be paid by us) to Mark D. Klein and (b) 60,000 restricted shares (with any aggregate income tax liability to be paid by us) to MarkAllison Green, D.and Klein;we (b) a grant of 60,000 restricted shares (with any aggregate income tax liability to be paid by us) to Allison Green; (c)approved a cash bonus of $850,000 to Mark D. Klein; and (d) a cash bonus of $500,000 to Allison Green. TheOn foregoingJune compensation15, will2026, beour Board paidof onlyDirectors ifapproved the Advisoryacceleration Agreementin isfull approvedof bythe ourvesting stockholders.of all restricted shares then outstanding and unvested under the Amended and Restated 2019 Equity Incentive Plan and the Second Amended and Restated 2019 Equity Incentive Plan, effective as of June 15, 2026. Those shares vested on that date, subject to each holder’s entry into a lock-up agreement with us that replicates the holding periods of the vesting schedules that otherwise would have applied to such shares.

For additional information regarding the Externalization and its impact on stockholders, the Advisory Agreement, the Administration Agreement, Agreement, Magnetar and the compensation of management relating to the Externalization, please refer to “Note 11—Stock-Based Compensation” and “Note 12—Subsequent Events” to our Condensed Consolidated Financial Statements as of MarchJune 31,30, 20262026, our definitive proxy statement for the Special Meeting of Stockholders filed April 29, 2026, and to theour Current ReportReports on Form 8-K we filed on April 7, 2026 and July 21, 2026.