Company: EQS
Filing Date: 2025-04-10
Form Type: 10-K
Source: 0001712543-25-000016
Chunk: 11

Company: EQUUS TOTAL RETURN, INC.
Filing Date: 2025-04-10
Form: 10-K
Item: Item 1
Chunk 11
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 must continue to qualify as an investment company to obtain RIC status under
the Code, among other requirements. To obtain (or maintain, as the case may be) RIC status, we must (i) continue to qualify as an investment
company; (ii) distribute to our stockholders in a timely manner at least 90% of our investment company taxable income, as defined by the
Code; (iii) derive in each taxable year at least 90% of our gross investment company income from dividends, interest, payments with respect
to securities loans, gains from the sale of stock or other securities or other income derived with respect to our business of investing
in such stock or securities as defined by the Code; and (iv) meet investment diversification requirements. The diversification requirements
generally require us, at the end of each quarter of the taxable year, to have (a) at least 50% of the value of our assets consist of cash,
cash items, government securities, securities of other RICs and other securities if such other securities of any one issuer do not represent
more than 5% of our assets and 10% of the outstanding voting securities of the issuer and (b) no more than 25% of the value of our assets
invested in the securities of one issuer (other than U. S. government securities and securities of other RICs), or of two or more issuers
that are controlled by us and are engaged in the same or similar or related trades or businesses.

In addition,
should we choose not to distribute at least 98.2% of our net income consisting of capital gains for each one-year period ending on October
31, we will be subject to a 4.0% nondeductible Federal exercise tax.

If we fail to satisfy
the 90% distribution requirement or otherwise fail to requalify as a RIC in any taxable year, we will be subject to tax in such year on
all of our taxable income, regardless of whether we make any distribution to our stockholders. In addition, in that case, all of our distributions
to our stockholders will be characterized as ordinary income (to the extent of our current and accumulated earnings and profits). We have
distributed and currently intend to distribute sufficient dividends to eliminate our investment company taxable income; however, none
have been necessary in recent years.

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Custodian

We act as the
custodian of our securities