Financial Data and Key Metrics Changes - Total investment income increased by almost 16% year-over-year, reaching $675,000 in Q2 2020, primarily due to an 81% increase in interest income [7][22] - Net income rose to $199,000 or $0.08 per share, compared to a loss of $0.20 per share in the same quarter last year [7] - Net asset value (NAV) decreased to $49.7 million, down more than $4 million, with NAV per share at $19.21, compared to $33.2 per share at the end of March 2020 [9][26] Business Line Data and Key Metrics Changes - The company invested approximately $1.5 million in SciAps and $750,000 in Tilson Technology during the quarter, with interest from portfolio companies increasing to 81% from 2019 [13][22] - The investment strategy focused on 58% equity and 42% debt, aiming to generate current income complemented by capital appreciation [12] Market Data and Key Metrics Changes - The company maintained a high level of cash at $22 million, representing 44% of net assets, with an additional $3 million available from the SBA loan program [11][27] - The portfolio value of public BDC securities increased by approximately $269,000 during the quarter [17] Company Strategy and Development Direction - The company continues to focus on yield investments, primarily in debt and loan instruments, while also evaluating equity investments for dividend income [12] - The management emphasized the importance of portfolio diversity to reduce market risk during challenging economic times [14] Management Comments on Operating Environment and Future Outlook - Management acknowledged the ongoing challenges posed by the COVID-19 pandemic but expressed confidence in the company's transformation strategy and financial performance [6][7] - The management is actively monitoring portfolio companies' liquidity and operational status, noting their resilience during the pandemic [16] Other Important Information - A special dividend of $23.7 million was distributed in May, impacting the net asset value [8] - The company executed a 1 for 9 reverse stock split and repurchased 1,300 shares under its share repurchase authorization [10] Q&A Session Summary Question: Dividend distribution based on earnings - Management confirmed that a minimum of 90% of net investment income will be distributed as dividends, with further guidance expected in Q3 [31] Question: Plans for raising additional funds - Management stated that there are currently no plans to raise additional funds, emphasizing the existing cash reserves of $22 million [37] Question: Investment opportunities with current cash reserves - Management indicated ongoing efforts to invest the cash, focusing on increasing investment income through debt instruments [38] Question: Impact of Eastman Kodak developments - Management clarified that they are not aware of any direct benefits from Eastman Kodak's recent developments [46]

Financial Performance - Total investment income increased by 157% from $583 thousand in Q2 2019 to $675 thousand in Q2 2020[27] - Total expenses decreased by 42% from $824 thousand in Q2 2019 to $476 thousand in Q2 2020[27] - Net investment income per share was $008 in Q2 2020, up from a loss of $020 in Q2 2019[8] - Net assets decreased from $541 million at 3/31/2020 to $497 million at 6/30/2020[31] - NAV per share at 6/30/2020 was $1921, reflecting the impact of additional shares from the dividend distribution[34] Investment Strategy & Portfolio - Investment strategy shifted to generating current income, with debt investments increasing from 35% at 6/30/2019[11] - Interest income from portfolio companies increased by 81% to $571 thousand in Q2 2020 compared to Q2 2019[11] - The company purchased $750 thousand of Series F preferred stock of Tilson Technology, increasing dividend income[11] - The portfolio is increasingly diversified, with software representing 33% of investments at fair value of $386 million as of June 30, 2020[17,18] - Top five portfolio investments represent 56% of the total portfolio value of $386 million[22] Liquidity & Capital Activities - The company has excellent liquidity with $22 million in cash and cash equivalents at June 30, 2020[8] - A cash dividend and stock dividend of 960 thousand shares was paid on May 11, 2020[8]

FIRST QUARTER 2020 | --- | --- | --- | --- | --- | --- | |-------|-------|-------|-------|-------|-----------------------| | | | | | | | | | | | | | | | | | | | | F INANCIAL R ESULTS | | | | | | | May 11, 2020 | | | | | | | Allen F. "Pete" Grum | | | | | | | President & CEO | Daniel P. Penberthy Executive Vice President & CFO © 2020 Rand Capital Corporation Nasdaq: RAND SAFE HARBOR STATEMENT This presentation contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 19 ...