Company: PNNT
Filing Date: 2025-11-24
Form Type: 10-K
Source: 0001193125-25-293703
Chunk: 30

Company: PENNANTPARK INVESTMENT CORP
Filing Date: 2025-11-24
Form: 10-K
Item: Item 1C
Chunk 30
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 interest. Loan origination fees, OID, market discount or premium and deferred financing costs on liabilities, which we do not fair value, are capitalized and then accreted or amortized using the effective interest method as interest income or, in the case of deferred financing costs, as interest expense. We record prepayment penalties on loans and debt investments as income. Dividend income, if any, is recognized on an accrual basis on the ex-dividend date to the extent that we expect to collect such amounts. From time to time, the Company receives certain fees from portfolio companies, which are non-recurring in nature. Such fees include loan prepayment penalties, structuring fees and amendment fees, and are recorded as other investment income when earned.Net Realized Gains or Losses and Net Change in Unrealized Appreciation or DepreciationWe measure realized gains or losses by the difference between the net proceeds from the repayment or sale and the amortized cost basis of the investment, using the specific identification method, without regard to unrealized appreciation or depreciation previously recognized, but considering unamortized upfront fees and prepayment penalties. Net change in unrealized appreciation or depreciation reflects the change in fair values of our portfolio investments, and our Truist Credit Facility, including any reversal of previously recorded unrealized appreciation or depreciation, when gains or losses are realized.Foreign Currency TranslationOur books and records are maintained in U.S. dollars. Any foreign currency amounts are translated into U.S. dollars on the following basis:1.Fair value of investment securities, other assets and liabilities – at the exchange rates prevailing at the end of the applicable period; and2.Purchases and sales of investment securities, income and expenses – at the exchange rates prevailing on the respective dates of such transactions.Although net assets and fair values are presented based on the applicable foreign exchange rates described above, we do not isolate that portion of the results of operations due to changes in foreign exchange rates on investments, other assets and debt from the fluctuations arising from changes in fair values of investments and liabilities held. Such fluctuations are included with the net realized and unrealized gain or loss from investments and liabilities.Payment-in-Kind, or, PIK Interest We have investments in our portfolio which contain a PIK interest provision. PIK interest is added to the principal balance of the investment and is recorded as income. In order for us to maintain our ability to be subject to tax as a RIC, substantially all of this income must be paid out to stockholders in the form of dividends for U