OXSQZ Oxford Square Capital Corporation

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 8-K

 

Current Report Pursuant to Section 13 or 15(d) of

the Securities Exchange Act of 1934

 

Date of Report (Date of earliest event reported):

February 28, 2025

 

OXFORD SQUARE CAPITAL CORP.

(Exact name of registrant as specified in its charter)

 

Maryland		814-00638		20-0188736
(State or other jurisdiction of incorporation)		(Commission File Number)		(I.R.S. Employer Identification No.)

 

8 Sound Shore Drive, Suite 255

Greenwich, CT 06830

(Address of principal executive offices and zip code)

 

(203) 983-5275

(Registrant’s telephone number, including area code)

 

n/a

(Former name or former address, if changed since last report)

 

Check the appropriate box below if the Form 8-K is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common stock, par value $0.01 per share		OXSQ		NASDAQ Global Select Market LLC
6.25% Notes due 2026		OXSQZ		NASDAQ Global Select Market LLC
5.50% Notes due 2028		OXSQG		NASDAQ Global Select Market LLC

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).

 

Emerging growth company ☐

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

 

 

Item 2.02 Results of Operations and Financial Condition

 

On February 28, 2025, Oxford Square Capital Corp. (the “Company”) issued a press release announcing its financial results for the quarter ended December 31, 2024. The text of the press release is included as Exhibit 99.1 to this Form 8-K.

 

The information set forth under this Item 2.02, including Exhibit 99.1, is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section. The information set forth under this Item 2.02, including Exhibit 99.1, shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act of 1933, as amended, unless it is specifically incorporated by reference therein.

 

Item 7.01 Regulation FD Disclosure

 

On February 28, 2025, the Company issued a press release, included herewith as Exhibit 99.1, announcing the declaration of distributions for the months ending April 30, 2025, May 31, 2025, and June 30, 2025. Additionally, on February 28, 2025, the Company made available on its website, www.oxfordsquarecapital.com, supplemental investor information with respect to the aforementioned earnings press release.

 

The information disclosed under this Item 7.01, including Exhibit 99.1 hereto, is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section. The information provided herein shall not be deemed incorporated by reference into any filing made under the Securities Act of 1933, as amended, except as expressly set forth by specific reference in such filing.

 

Item 9.01 Financial Statements and Exhibits.

 

(d)

Exhibits.

 

Exhibit No.		Description
99.1		Press release dated February 28, 2025
104		Cover Page Interactive Data File (embedded within the inline XBRL document).

 

 

SIGNATURE

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

Date: February 28, 2025	OXFORD SQUARE CAPITAL CORP.
	By:	/s/ Saul B. Rosenthal
		Saul B. Rosenthal
		President

 

Exhibit 99.1

 

Oxford Square Capital Corp. Announces Net Asset Value and Selected Financial Results for the Quarter Ended December 31, 2024 and Declaration of Distributions on Common Stock for the Months Ending April 30, May 31, and June 30, 2025

 

GREENWICH, CT – 2/28/2025 –Oxford Square Capital Corp. (NasdaqGS: OXSQ) (NasdaqGS: OXSQZ) (NasdaqGS: OXSQG) (the “Company,” “we,” “us” or “our”) announced today its financial results and related information for the quarter ended December 31, 2024.

 

●

On February 27, 2025, our Board of Directors declared the following distributions on our common stock:

 

Month Ending	Record Date	Payment Date	Amount Per Share
April 30, 2025	April 16, 2025	April 30, 2025	$0.035
May 31, 2025	May 16, 2025	May 30, 2025	$0.035
June 30, 2025	June 16, 2025	June 30, 2025	$0.035

 

●

Net asset value (“NAV”) per share as of December 31, 2024 stood at $2.30, compared with a NAV per share on September 30, 2024 of $2.35.

 

●

Net investment income (“NII”) was approximately $6.0 million, or $0.09 per share, for the quarter ended December 31, 2024, compared with approximately $6.2 million, or $0.10 per share, for the quarter ended September 30, 2024.

 

●

Total investment income for the quarter ended December 31, 2024 amounted to approximately $10.2 million, compared with approximately $10.3 million for the quarter ended September 30, 2024.

 

○

For the quarter ended December 31, 2024 we recorded investment income from our portfolio as follows:

 

§

$5.4 million from our debt investments;

 

§

$4.1 million from our CLO equity investments; and

 

§

$0.8 million from other income.

 

●

Our total expenses for the quarter ended December 31, 2024 were approximately $4.2 million, which was approximately the same as the quarter ended September 30, 2024.

 

●

As of December 31, 2024, the following metrics applied (note that none of these metrics represented a total return to shareholders):

 

○

The weighted average yield of our debt investments was 15.8% at current cost, compared with 14.5% as of September 30, 2024;

 

○

The weighted average effective yield of our CLO equity investments at current (start of quarter for existing investments) cost was 8.8%, compared with 9.6% as of September 30, 2024; and

 

○

The weighted average cash distribution yield of our cash income producing CLO equity investments at current cost was 16.2%, compared with 15.3% as of September 30, 2024.

 

●

For the quarter ended December 31, 2024, we recorded a net increase in net assets resulting from operations of approximately $3.3 million, consisting of:

 

○

NII of approximately $6.0 million;

 

○

Net realized losses of approximately $44.8 million; and

 

○

Net unrealized appreciation of approximately $42.1 million.

 

●

During the fourth quarter of 2024, we made investments of approximately $25.1 million and received approximately $22.0 million from sales and repayments of investments.

 

●

Our weighted average credit rating was 2.3 based on total fair value and 2.4 based on total principal amount as of December 31, 2024, compared with a weighted average credit rating of 2.4 based on total fair value and 2.8 based on total principal amount as of September 30, 2024.

 

●

As of December 31, 2024, we had one debt investment in one portfolio company on non-accrual status, with a fair value of approximately $0.5 million. Also, as of December 31, 2024, our preferred equity investments in one of our portfolio companies were on non-accrual status, which had an aggregate fair value of approximately $4.6 million.

 

●

For the quarter ended December 31, 2024, we issued a total of approximately 1.8 million shares of common stock pursuant to an “at-the-market” offering. After deducting the sales agent’s commissions and offering expenses, this resulted in net proceeds of approximately $5.0 million. As of December 31, 2024, we had approximately 69.8 million shares of common stock outstanding.

 

We will hold a conference call to discuss fourth quarter results today, Friday, February 28^th, 2025 at 9:00 AM ET. The toll-free dial-in number is 1-800-549-8228. There will be a recording available for 30 days. If you are interested in hearing the recording, please dial 1-888-660-6264. The replay pass-code number is 06523#.

 

A presentation containing further detail regarding our quarterly results of operations has been posted under the Investor Relations section of our website at www.oxfordsquarecapital.com.

 

 

OXFORD SQUARE CAPITAL CORP.

 

STATEMENTS OF ASSETS AND LIABILITIES

 

		December 31, 2024				December 31, 2023
		(Unaudited)
ASSETS
Non-affiliated/non-control investments (cost: $358,356,496 and $440,069,822, respectively)		$	256,238,759			$	261,614,335
Affiliated investments (cost: $16,836,822 and $16,836,822, respectively)			4,614,100				5,276,092
Cash and cash equivalents			34,926,468				5,740,553
Interest and distributions receivable			2,724,049				3,976,408
Other assets			1,227,598				1,060,384
Total assets		$	299,730,974			$	277,667,772
LIABILITIES
Notes payable – 6.25% Unsecured Notes, net of deferred issuance costs of $309,812 and $543,609, respectively			44,480,938				44,247,141
Notes payable – 5.50% Unsecured Notes, net of deferred issuance costs of $1,381,619 and $1,768,219, respectively			79,118,381				78,731,781
Securities purchased, not settled			12,027,463				—
Base Fee and Net Investment Income Incentive Fee payable to affiliate			1,215,964				1,012,389
Accrued interest payable			1,204,487				1,204,487
Accrued expenses			1,018,261				1,163,349
Total liabilities			139,065,494				126,359,147
NET ASSETS
Common stock, $0.01 par value, 100,000,000 shares authorized; 69,758,938 and 59,300,472 shares issued and outstanding, respectively			697,590				593,005
Capital in excess of par value			487,943,476				458,121,381
Total distributable earnings/(accumulated losses)			(327,975,586	)			(307,405,761	)
Total net assets			160,665,480				151,308,625
Total liabilities and net assets		$	299,730,974			$	277,667,772
Net asset value per common share		$	2.30			$	2.55

 

 

OXFORD SQUARE CAPITAL CORP.

 

STATEMENTS OF OPERATIONS

 

		Year Ended December 31, 2024				Year Ended December 31, 2023				Year Ended December 31, 2022
		(Unaudited)
INVESTMENT INCOME
From non-affiliated/non-control investments:
Interest income – debt investments		$	24,929,287			$	33,592,166			$	25,234,315
Income from securitization vehicles and investments			15,403,586				16,796,699				17,093,203
Other income			2,350,332				1,435,316				790,594
Total investment income from non-affiliated/non-control investments			42,683,205				51,824,181				43,118,112
Total investment income			42,683,205				51,824,181				43,118,112
EXPENSES
Interest expense			7,847,320				10,825,877				12,354,392
Base Fee			4,310,484				4,613,664				5,903,986
Professional fees			1,537,434				1,426,098				1,393,116
Compensation expense			746,762				825,226				915,583
Director’s fees			417,500				429,500				417,500
Insurance expense			308,552				329,892				378,804
Transfer agent and custodian fees			260,330				246,562				231,241
Excise tax			216,528				1,423,686				252,172
General and administrative			597,883				638,350				583,740
Total expenses before incentive fees			16,242,793				20,758,855				22,430,534
Net Investment Income Incentive Fees			—				3,705,387				—
Capital gains incentive fees			—				—				—
Total incentive fees			—				3,705,387				—
Total expenses			16,242,793				24,464,242				22,430,534
Net investment income			26,440,412				27,359,939				20,687,578
NET UNREALIZED APPRECIATION/(DEPRECIATION) AND REALIZED LOSSES ON INVESTMENT TRANSACTIONS
Net change in unrealized appreciation/(depreciation) on investments:
Non-Affiliate/non-control investments			76,337,750				6,198,413				(109,479,985	)
Affiliated investments			(661,992	)			926,274				3,577,327
Total net change in unrealized appreciation/(depreciation) on investments			75,675,758				7,124,687				(105,902,658	)
Net realized losses:
Non-affiliated/non-control investments			(96,236,489	)			(17,056,245	)			(339,819	)
Extinguishment of debt			—				(190,353	)			—
Total net realized losses			(96,236,489	)			(17,246,598	)			(339,819	)
Net unrealized and realized losses			(20,560,731	)			(10,121,911	)			(106,242,477	)
Net increase/(decrease) in net assets resulting from operations		$	5,879,681			$	17,238,028			$	(85,554,899	)
Net increase in net assets resulting from net investment income per common share (Basic and Diluted):		$	0.42			$	0.51			$	0.42
Net increase/(decrease) in net assets resulting from operations per common share (Basic and Diluted):		$	0.09			$	0.32			$	(1.72	)
Weighted average shares of common stock outstanding (Basic and Diluted):			63,465,255				53,919,104				49,757,122

 

 

FINANCIAL HIGHLIGHTS

 

		Year Ended December 31, 2024				Year Ended December 31, 2023				Year Ended December 31, 2022				Year Ended December 31, 2021				Year Ended December 31, 2020
		(Unaudited)
Per Share Data
Net asset value at beginning of year		$	2.55			$	2.78			$	4.92			$	4.55			$	5.12
Net investment income(1)			0.42				0.51				0.42				0.32				0.40
Net realized and unrealized gains (losses)(2)			(0.33	)			(0.19	)			(2.14	)			0.47				(0.36	)
Net change in net asset value from operations			0.09				0.32				(1.72	)			0.79				0.04
Distributions per share from net investment income			(0.42	)			(0.54	)			(0.42	)			(0.42	)			(0.61	)
Distributions based on weighted average share impact			—				(0.01	)			—				—				—
Tax return of capital distributions			—				—				—				—				—
Total distributions(3)			(0.42	)			(0.55	)			(0.42	)			(0.42	)			(0.61	)
Effect of shares issued, net of offering expenses			0.08				—				—				—				—
Effect of shares issued/repurchased, gross			—				—				—				—				—
Net asset value at end of year		$	2.30			$	2.55			$	2.78			$	4.92			$	4.55
Per share market value at beginning of year		$	2.86			$	3.12			$	4.08			$	3.05			$	5.44
Per share market value at end of year		$	2.44			$	2.86			$	3.12			$	4.08			$	3.05
Total return based on Market Value(4)			(1.64	)%			9.34	%			(14.11	)%			47.38	%			(31.75	)%
Total return based on Net Asset Value(5)			6.67	%			11.15	%			(34.96	)%			17.36	%			0.82	%
Shares outstanding at end of year			69,758,938				59,300,472				49,844,796				49,690,059				49,589,607
Ratios/Supplemental Data(7)
Net assets at end of year (000’s)		$	160,665			$	151,309			$	138,672			$	244,595			$	225,427
Average net assets (000’s)		$	152,362			$	149,944			$	192,785			$	242,589			$	192,137	%
Ratio of expenses to average net assets			10.66	%			16.32	%			11.64	%			8.69	%			8.45	%
Ratio of net investment income to average net assets			17.35	%			18.25	%			10.73	%			6.64	%			10.26	%
Portfolio turnover rate(6)			33.66	%			3.85	%			17.09	%			11.09	%			23.72	%

 

(1)	Represents per share net investment income for the period, based upon weighted average shares outstanding.
(2)	Net realized and unrealized gains include rounding adjustments to reconcile change in net asset value per share.
(3)	Management monitors available taxable earnings, including net investment income and realized capital gains, to determine if a tax return of capital may occur for the year. To the extent the Company’s taxable earnings fall below the total amount of the Company’s distributions for that fiscal year, a portion of those distributions may be deemed a tax return of capital to the Company’s stockholders. The ultimate tax character of the Company’s earnings cannot be determined until tax returns are prepared after the end of the fiscal year.
(4)	Total return based on market value equals the increase or decrease of ending market value over beginning market value, plus distributions, assuming distribution reinvestment prices obtained under the Company’s distribution reinvestment plan, excluding any discounts divided by the beginning market value per share.
(5)	Total return based on net asset value equals the increase or decrease of ending net asset value over beginning net asset value, plus distributions, divided by the beginning net asset value.
(6)	Portfolio turnover rate is calculated using the lesser of the annual investment sales and repayments of principal or annual investment purchases over the average of the total investments at fair value.
(7)	The following table provides supplemental performance ratios measured for the years ended December 31, 2024, 2023, 2022, 2021, and 2020:

 

 

		Year Ended December 31, 2024				Year Ended December 31, 2023				Year Ended December 31, 2022				Year Ended December 31, 2021				Year Ended December 31, 2020
		(Unaudited)
Ratio of expenses to average net assets:
Expenses before incentive fees			10.66	%			13.84	%			11.64	%			8.69	%			8.45	%
Net Investment Income Incentive Fees			—	%			2.47	%			—	%			—	%			—%
Capital Gains Incentive Fees			—	%			—	%			—	%			—	%			—%
Ratio of expenses, excluding interest expense, to average net assets			5.51	%			9.10	%			5.23	%			4.36	%			4.35	%

 

About Oxford Square Capital Corp.

 

Oxford Square Capital Corp. is a publicly-traded business development company principally investing in syndicated bank loans and, to a lesser extent, debt and equity tranches of collateralized loan obligation (“CLO”) vehicles. CLO investments may also include warehouse facilities, which are financing structures intended to aggregate loans that may be used to form the basis of a CLO vehicle.

 

Forward-Looking Statements

 

This press release contains forward-looking statements subject to the inherent uncertainties in predicting future results and conditions. Any statements that are not statements of historical fact (including statements containing the words “believes,” “plans,” “anticipates,” “expects,” “estimates” and similar expressions) should also be considered to be forward-looking statements. These statements are not guarantees of future performance, conditions or results and involve a number of risks and uncertainties. Certain factors could cause actual results and conditions to differ materially from those projected in these forward-looking statements. These factors are identified from time to time in our filings with the Securities and Exchange Commission. We undertake no obligation to update such statements to reflect subsequent events, except as may be required by law.

 

Contact:

Bruce Rubin

203-983-5280

 

v3.25.0.1

Cover	Feb. 28, 2025
Document Type	8-K
Amendment Flag	false
Document Period End Date	Feb. 28, 2025
Entity File Number	814-00638
Entity Registrant Name	OXFORD SQUARE CAPITAL CORP.
Entity Central Index Key	0001259429
Entity Tax Identification Number	20-0188736
Entity Incorporation, State or Country Code	MD
Entity Address, Address Line One	8 Sound Shore Drive
Entity Address, Address Line Two	Suite 255
Entity Address, City or Town	Greenwich
Entity Address, State or Province	CT
Entity Address, Postal Zip Code	06830
City Area Code	203
Local Phone Number	983-5275
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Entity Emerging Growth Company	false
Common stock, par value $0.01 per share
Title of 12(b) Security	Common stock, par value $0.01 per share
Trading Symbol	OXSQ
Security Exchange Name	NASDAQ
6.25% Notes due 2026
Title of 12(b) Security	6.25% Notes due 2026
Trading Symbol	OXSQZ
Security Exchange Name	NASDAQ
5.50% Notes due 2028
Title of 12(b) Security	5.50% Notes due 2028
Trading Symbol	OXSQG
Security Exchange Name	NASDAQ

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