Terms

Series

7.000% Series K Cumulative Preferred Stock

Liquidation Preference

$25.00

Coupon Rate

7%

Rate Type

Fixed

Annual Dividend

$1.75

Payment Frequency

Quarterly

Cumulative

Yes

Perpetual

Yes

Convertible

No

Callable

Yes

First Call Date

September 30, 2026

First Call Price

$25.00

Capital Stack Ranking

Junior To: 6.50% Senior Unsecured Notes Due 2035 ($15,000,000), Secured Revolving Credit Facility; Pari Passu With: Series D Term Preferred Stock, Series E Term Preferred Stock, Series F Term Preferred Stock, Series G Term Preferred Stock, Series H Term Preferred Stock, Series I Term Preferred Stock, Series J Term Preferred Stock, All Other Shares Of Preferred Stock; Senior To: Common Stock

Regulatory (Basel III) Call

No

Tax Classification

Qualified Dividend

Qualifies for QDI

Yes

Qualifies for DRD

Yes

Shares Offered

1,400,000

Prospectus Summary

Priority Income Fund, Inc. — an externally managed, non-diversified closed-end investment company focused on CLO equity/junior debt and senior secured loans — is offering 1,400,000 shares of its 7.000% Series K Cumulative Preferred Stock at $25.00 per share (liquidation preference $25.00, par $0.01), listed on NYSE under 'PRIFK.' The fixed 7.00% coupon yields $1.75 per share annually ($0.4375 per quarter), payable quarterly. The stock is perpetual with no fixed maturity but is callable at $25.00 at the issuer's sole option any time after September 30, 2026. Dividends are cumulative, meaning missed payments accumulate and must be paid in full before any distributions are made to common stockholders. Series K sits pari passu with all other outstanding preferred series (D, E, F, G, H, I, J) and ranks senior to common stock, but is expressly subordinated to the company's $15 million 6.50% senior unsecured notes due 2035 and its $35 million secured revolving credit facility. There is no structural subordination in the bank-holding-company sense, as this is a closed-end fund rather than a bank. The 1940 Act requires asset coverage of at least 200% for preferred stock; if coverage falls below that threshold, the company is obligated to mandatorily redeem sufficient preferred shares (potentially including Series K) to restore compliance, which creates meaningful protection but also redemption risk at par during distressed periods. At the $25.00 offering price, the effective yield is exactly 7.00% ($1.75 annually). As a regulated investment company (RIC), Priority Income Fund distributes ordinary income derived primarily from CLO equity and debt tranches; distributions may qualify for the reduced 15%/20% qualified dividend income (QDI) rate for individual holders and the dividends-received deduction (DRD) for corporate holders to the extent sourced from qualifying dividends, though the predominantly interest-income nature of CLO cash flows means a significant portion is likely taxed as ordinary income. If dividends on any preferred series are in arrears for two or more years, preferred holders gain the right to elect a majority of the Board, providing a governance backstop against prolonged payment interruption.

Summarized from the SEC prospectus filing.

Distribution History

Ranking vs. Other Preferreds

Dividend Stopper Provisions

Dividend Stopper Description

Dividends are paid only when authorized by the Board and out of legally available funds; if the asset coverage ratio falls below 200%, the company must redeem preferred shares rather than pay dividends, and dividends on common stock would be blocked if preferred dividends are in arrears.

Div Score Breakdown

Reinvesty's multi-factor safety analysis for this preferred, composite score: 50 (Average)