MARKETS CHANGE… SO SHOULD YOUR INVESTMENT OPTIONS.

FLEXIBLE FIXED

Securities Offered Through Triton Pacific Securities, LLC | Dealer Manager | Member FINRA/SIPC

PROSPECT FLEXIBLE INCOME FUND

Prospect Flexible Income Fund, Inc. seeks to provide income primarily from senior and secured credit, from a strategy that is flexible up and down the range of loans investment structures, and flexible across the spectrum of U.S. economic sectors.

76%Better

Diversification

75%Insulation from

Volatility

78%Better Balance of Risk and Return

74%Returns not Tied to the Markets

A recent study of individual investors showed that 3 out of every 4 investors wanted better diversification, better balance of risk and return, insulation from volatility, and returns with low correlation to the market.

Source: 1) Nataxis Global Asset Management, 2017 Individual Investor Survey, August 2017

Prospect Flexible Income Fund, Inc.

What Investors Want1

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In order to reduce volatility, conventional wisdom says you can counterbalance the volatility of equities with fixed income. However, in recent years a typical 60/40 portfolio has been almost perfectly correlated with a portfolio comprised of equities.1

Additionally, rising rates may affect returns negatively.

Investors cannot directly invest in an index. Past performance is not indicative of future results. Sources: 1) J.P. Morgan Guide to Markets 4Q 2018 – Barclays, Bloomberg, U.S. Treasury. Sectors shown above are provided by Barclays and are represented by: Broad Market: U.S. Aggregate; MBS: U.S. Aggregate Securitized-MBS; Corporate: U.S. Corporates; Municipals: Muni Bond 10-year; High Yield: Corporate High Yield; TIPS: Treasury Inflation Protection Securities; Floating Rate: FRN (BBB); Convertibles: Convertibles yield is based on US portion of Bloomberg Barclays Global Convertibles. Change in bond price is calculated using both duration and convexity according to the following formula New Price = (Price*Duration* Change in interest rates))+(0.5*Price*Convexity* (Change in interest rates)^2). Chart is for illustrative purposes only.

Uncertainty in the Marketplace

S&P 500

60/40 Portfolio

0.99 Correlation

Impact of a 1% Rise in Interest Rates2

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1) The yields quoted for Investment Grade Bond 10 Year, Investment Grade Municipal Bond 10 Year, Treasury Bond 10 Year, and CDs 1 Year are sourced from the FINRA-Bloomberg U.S. Corporate Bond Index, Bloomberg - BVAL Muni Benchmark 10Y Index, U.S. Department of Treasury Daily Bond Rate and Bankrate.com “Best 1-year CD Rates” respectively. All yields as of August 8, 2018. Investment Grade ranges from “AAA/Aaa” (Prime) to “BBB-/Baa3” (Lower Medium Grade) as rated by Nationally Recognized Statistical Rating Organizations such as Moody’s, Standard & Poor’s or Fitch. Ratings only pertain to the underlying bonds used for comprising a composite bond rate and not the composite bond rate itself. Inflation data for the twelve months ending July 31, 2018. Past Performance is not indicative of future results.

Traditional Fixed Income Challenges

Traditional Fixed Income Yields Remain DepressedInvestors are struggling to find yield with traditional fixed income vehicles.1

Fixed Income Values Volatile and Correlated

to the Market

Fixed Income Yields Low1

Possible Interest Rate Increases will

Erode Fixed Income

Current Inflation2.9%

4.20%

Investment GradeBond 10 Year

Investment Grade Municipal Bond 10 Year

Treasury Bond 10 Year

CDs1 Year

2.60%

5%

4%

3%

2%

1%

0%

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We believe in today’s low yield environment, private lending should be a component in an investor’s portfolio provided it meets the investors risk profile and investment objectives.1

Sources: 1) BLU, What Private Lending Can Do for Your Portfolio, January 2018. 2) Preqin, 2018 Global Private Debt Report.

“Alternative” Options

PrivateEquity

Equity investments in privately held

companies

PrivateCredit

Privately held loans to both public and private companies

• $769 billion market2

PrivateReal Estate

Equity investments and loans to privately held

real estate

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Prospect Flexible Income Fund, Inc. is a non-traded business development company (“BDC”) that invests primarily in senior and secured credit of privately-owned U.S. middle-market companies, including:

Investment Overview

Senior Secured First Lien

Senior Secured

Second Lien

DirectlyOriginated

Loans

SubordinatedDebt

Private Equity

Target Investments

Secondary Investments

• Highest priority in the capital structure• Typically secured by borrower’s assets• Yield, interest rate, and inflation protection through floating rates

and LIBOR floors• May not be fully secured by borrower assets or subject to re-pricing risk

• Directly originated loans may provide higher yields while remaining senior to equity while prepayment premiums may also help support yield

• Subordinated debt may provide potential liquidity through secondary markets• Private equity may provide diversifying power as an alternative to

the public markets

Rated Secured Structured Notes

+ Structured Suboridinated

Notes

Key

Cha

ract

eris

tics

Key

Cha

ract

eris

tics

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Prospect Flexible Income Fund, Inc. aims to help reduce portfolio risk due to attractive senior and secured loan characteristics:

Payment Priority

Senior and secured debt holders are due to receive payment before junior creditors and equity holders.

Security Senior and secured debt investments are typically secured by the borrower’s assets.

Adjustable Coupon Payments Floating-rate loans are structured so that interest rates reset on a periodic basis.

1) Senior secured loans and second lien secured loans. Source: Thompson Reuters LPC. 2) S&P Global Market Intelligence, Standard & Poor’s Leveraged Commentary & Data as of 3Q 2018. 3) As of September 2018. Source: Preqin Ltd.

Asset Class Benefits

Large MarketInstitutional loan issuance

= $730 billion in 20181

Banks Out, Funds In86% reduction in

participation in leveraged loans by commercial banks2

Strong Demand $1.1 trillion in debt capital held by funds of private

equity firms3

Market Opportunity

Bank consolidation and increased banking regulations have significantly reduced the amount of commercial loans available to middle-market borrowers. At the same time, U.S. middle-market companies need capital in order to grow and support their daily operations. As a result, we believe that there are and will continue to be significant investment opportunities in senior and secured lending to middle-market companies.

An investment strategy focused primarily on privately-held companies presents certain challenges, including the lack of available information about these companies, an illiquid market which may affect our ability to exit investments, and more limited access to capital which could add financial stress to such companies.

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Diligent. Dynamic. Disciplined.Prospect Capital Management L.P. (“Prospect Capital”), an affiliate of the Adviser, along with its predecessors and affiliates, has a 30-year history of investing in and managing high-yielding debt and equity investments using both private partnerships and publicly traded closed-end structures.

Investment Manager: Prospect Capital

OVERVIEW

• $6.4 billion alternatives investments manager with a 31-year history.

• Extensive expertise in originating, evaluating, structuring, managing, and exiting senior and secured loan investments.

• 100 total professionals with 50 investment professionals.

• Senior management together for over 19 years.

• Institutional-quality and Sarbanes-Oxley process compliant infrastructure.

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Source: 1) As of March 31, 2019 unless otherwise noted. Sources includes EDGAR filings, public presentations, and Prospect Capital Management L.P. (“Prospect”) estimates.

Middle-Market Direct Lending

$2.9B

Middle-Market Buyouts

$1.0B

Rated Secured Structured Notes + Structured Subordinated Notes

$1.4B

Real Estate Private Equity

$0.8B

Other

$0.4B

$6.4B Prospect AUM

Assets Under Management1

Established platform with seasoned investment professionals.

Long-term investment horizon.

Disciplined, income-oriented investment philosophy.

Investment expertise across all levels of the corporate capital structure.

Potential Competitive Strengths

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• Invest primarily in the debt of privately-owned U.S. middle-market companies, which we define as companies with annual revenue between $50 million and $2.5 billion.

• Focus primarily on making investments in syndicated senior secured first lien loans, syndicated senior secured second lien loans, and to a lesser extent, subordinated debt, of middle market companies in a broad range of industries.

• Our target credit investments will typically have initial maturities between three and ten years and generally range in size between $1 million and $100 million, although the investment size will vary with the size of our capital base.

• The majority of our debt investments will bear interest at floating interest rates, but our portfolio may also include fixed-rate investments.

Investment Overview

Why Invest in Prospect Flexible Income Fund, Inc.?

The Fund strives to generate current income and, as a secondary objective, capital appreciation by targeting investment opportunities with favorable risk-adjusted returns. By investing in the fund, investors may benefit from:

Income from a wide array of loans and credit investments

Low volatility and low correlation to traditional equities

Mitigated credit loss risk from senior and secured loans

Highly experienced team with expertise across alternative investments

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Offering Details

Prospect Flexible Income Fund, Inc. is a closed-end management investment company that has elected to be regulated as a business development company. 1) There is no guarantee of distributions or that any distributions paid will be paid at the stated rate. Distributions may be paid from sources other than cash flow from operations, including offering proceeds, borrowing or sales of assets, which may reduce an investor’s overall return and may constitute a return of capital. 2) Limited liquidity is provided to shareholders only through the Fund’s quarterly repurchase offers, for the lesser of: a) 2.5% of the weighted average number of shares outstanding in the prior calendar year, or b) cash proceeds available from sale of shares under our distribution reinvestment plan. The Fund is only suitable for investors who can bear the risks associated with the limited liquidity of the Fund and should be viewed as a long-term investment. There is no secondary market for the Fund’s shares and none is expected to develop. 3) In connection with this special repurchase offer, stockholders should be aware that: a) Only former stockholders of FLEX as of March 15, 2019, the date of FLEX’s 2019 annual stockholder meeting (the “Eligible Stockholders”), will be allowed to participate in the special repurchase offer, and they may have up to 100% of their shares repurchased. Former stockholders of PWAY and stockholders who purchase shares in this offering will not be able to participate in the special repurchase offer and b) If a substantial number of the Eligible Stockholders take advantage of this opportunity, it could minimize or eliminate the expected benefits of the Merger and it could: significantly decrease our asset size; require us to sell our investments earlier than the Adviser would have otherwise desired, which may result in selling investments at inopportune times or significantly depressed prices and/or at losses; or cause us to incur additional leverage solely to meet repurchase requests. 4) Some states may have different/ higher standards than defined here. 5) An investor will need to receive a total return at least in excess of these expenses to receive an actual return on the investment.

Structure Non-traded business development company (“BDC”)

Minimum Investment $5,000

Distribution Reinvestment Available at shareholder’s option; reinvested at net offering price

Distribution Frequency1 Paid monthly

Liquidity2 Quarterly, limited to lesser of DRIP proceeds or 2.5% of average shares in prior years

Tax Reporting 1099-DIV

Leverage 150% minimum asset coverage ratio

Leverage Facility $50.0 million revolving credit facility with Royal Bank of Canada

Special Repurchase Offer3 As a condition to being able to increase our leverage, we will offer to repurchase certain of our outstanding shares

Investor Suitability4 Minimum of $70,000 annual income and $70,000 of net worth; or $250,000 of net worth

Fees5 Offering expenses and a sales load of up to 6.00%

Fund Adviser Prospect Flexible Income Management, LLC

Dealer Manager Triton Pacific Securities, LLC

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www.FlexBDC.comSales Desk: (949) 429-8500

FLEX 08.04.2020

IMPORTANT RISK DISCLOSURES

This is neither an offer to sell nor a solicitation of an offer to purchase any security. Investors should carefully consider the investment objectives, risks, charges and expense of Prospect Flexible Income Fund, Inc. (“the Fund” or “our”, “we” or “us”). This and other important information about the Fund is contained in the prospectus, which can be obtained by contacting your financial advisor or visiting www.flexBDC.com. Please read the prospectus carefully before investing.

Special Repurchase Offer. As a condition to being able to increase our leverage, we will offer to repurchase certain of our outstanding shares. In connection with this special repurchase offer, stockholders should be aware that: a) Only former stockholders of FLEX as of March 15, 2019, the date of FLEX’s 2019 annual stockholder meeting (the “Eligible Stockholders”), will be allowed to participate in the special repurchase offer, and they may have up to 100% of their shares repurchased. Former stockholders of PWAY and stockholders who purchase shares in this offering will not be able to participate in the special repurchase offer and b) If a substantial number of the Eligible Stockholders take advantage of this opportunity, it could minimize or eliminate the expected benefits of the Merger and it could: significantly decrease our asset size; require us to sell our investments earlier than the Adviser would have otherwise desired, which may result in selling investments at inopportune times or significantly depressed prices and/or at losses; or cause us to incur additional leverage solely to meet repurchase requests. Past performance is not a guarantee of future results. Investing in the Fund involves risks, including the risk that you may receive little or no return on your investment or that you may lose part or all of your investment. The ability of the Fund to achieve its investment objective depends, in part, on the ability of Prospect Flexible Income Management, LLC (the “Adviser”) to allocate effectively the assets of the Fund among the various securities and investments in which the Fund invests. There can be no assurance that the actual allocations will be effective in achieving the Fund’s investment objective or delivering positive returns. Investors will pay offering expenses and a sales load of up to 6.00%. An investor will need to receive a total return at least in excess of these expenses to receive an actual return on the investment. An investment in Prospect Flexible Income Fund, Inc. (“the Fund” or “our”, “we” or “us”) is speculative and involves a high degree of risk, including the risk of a substantial loss of investment, as well as substantial fees and costs, all of which can impact an investor’s return. The following are some of the risks involved in an investment in our common shares; however, an investor should carefully consider the fees and expenses and information found in the “Risk Factors” section of our prospectus before deciding to invest.You should not expect to be able to sell your shares regardless of how we perform and you should consider that you may not have access to the money you invest for an indefinite period of time. An investment in shares of our common stock is not suitable for you if you need access to the money you invest.We intend to continue to issue shares in this offering and, as a result, your ownership in us is subject to dilution.

We do not intend to list our shares on any securities exchange for what may be a significant time after the first closing of this offering, and we do not expect a secondary market in our shares to develop. We define the term “offering period” as the time during which we conduct this offering, as approved and extended by our board of directors. The offering period currently extends to a date that is three years from the effective date of our new registration statement, which we expect to be approximately August 31, 2022. We may, in our discretion, extend the term of the offering indefinitely. As a result, you may be unable to reduce your exposure in any market downturn. If you are able to sell your shares before a liquidity event is completed, you will likely receive less than your purchase price.

We have a limited operating history and we have not identified specific investments that we will make with the proceeds of this offering, so we may be considered a blind pool because an investor may not have the opportunity to evaluate historical data or assess future investments prior to purchasing our shares.

We have not identified any specific investments that we will make with the proceeds of this offering and you will not have the opportunity to evaluate our future investments prior to purchasing shares of our common stock. As a result, our offering may be considered a “blind pool” offering.

The payment of fees and expenses will reduce the funds available for investment, the net income generated, the funds available for distribution and the book value of the common shares. In addition, the fees and expenses paid will require investors to achieve a higher total net return in order to recover their initial investment. Please see the Fund’s prospectus for details regarding its fees and expenses.

We intend to invest in securities that are rated below investment grade by rating agencies or that would be rated below investment grade if they were rated. Below investment grade securities, which are often referred to as “junk,” have predominantly speculative characteristics with respect to the issuer’s capacity to pay interest and repay principal. They may also be illiquid and difficult to value.

We may borrow funds to make investments. Leverage increases the volatility of investments. Moreover, our management fees will be higher than if we did not use leverage, whether or not the leveraged investments are ultimately successful.

We have implemented a share repurchase program pursuant to which we intend to continue to conduct quarterly repurchases of a limited number of outstanding shares of our common stock. Our board of directors has complete discretion to determine whether we will engage in any share repurchase, and if so, the terms of such repurchase. We intend to limit the number of shares to be repurchased in each quarter to the lesser of (a) 2.5% of the weighted average number of shares of our common stock outstanding in the prior calendar year and (b) the number of shares we can repurchase with the proceeds we receive from the sale of shares of our common stock under our distribution reinvestment plan. While we intend to continue to conduct quarterly tender offers as described above, we are not required to do so and may suspend or terminate the share repurchase program at any time.

Our Adviser may have an incentive to increase portfolio leverage in order to earn higher base management fees. In addition, the Adviser may be incentivized to enter into investments that are riskier or more speculative than would otherwise be the case for the potential for greater incentive based fees under the investment advisory agreement.

We intend to seek to complete a liquidity event (as defined in the Prospectus) within five to seven years following the completion of our offering period; however, there can be no assurance that we will be able to complete a liquidity event.

There can be no assurance that we will be able to complete a liquidity event within the time frame anticipated by us. Should we not be able to do so within seven years following the completion of this offering, subject to the authority of our independent directors or the rights of the stockholders to postpone liquidation, we may cease to make investments in new portfolio companies and could begin the orderly liquidation of our assets.

Distributions on our common stock may exceed our taxable earnings and profits, particularly during the period before we have substantially invested the net proceeds from our public offering. Therefore, portions of the distributions that we pay may represent a return of capital to you. A return of capital is a return of a portion of your original investment in shares of our common stock. As a result, a return of capital will (i) lower your tax basis in your shares and thereby increase the amount of capital gain (or decrease the amount of capital loss) realized upon a subsequent sale or redemption of such shares, and (ii) reduce the amount of funds we have for investment in portfolio companies. We have not established any limit on the extent to which we may use offering proceeds to fund distributions.

Distributions may also be funded in significant part, directly or indirectly, from (i) the waiver of certain investment advisory fees, that will not be subject to repayment to our Adviser and/or (ii) the deferral of certain investment advisory fees that may be subject to repayment to our Adviser and/or (iii) the reimbursement of certain operating expenses, that will be subject to repayment to our Adviser and its affiliates. Significant portions of distributions may not be based on investment performance. In the event distributions are funded from waivers and/or deferrals of fees and reimbursements by our affiliates, such funding may not continue in the future. If our affiliates do not agree to reimburse certain of our operating expenses or waive certain of their advisory fees, then significant portions of our distributions may come from offering proceeds or borrowings. The repayment of any amounts owed to our affiliates will reduce future distributions to which you would otherwise be entitled.

For a significant time after the commencement of our offering, a substantial portion of our distributions, if any, will result from expense waivers from our Adviser, which are subject to repayment by us. In addition, we may fund our cash distributions to stockholders from any sources of funds legally available to us, including offering proceeds and borrowings. If we borrow money to fund cash distributions, the costs of such borrowings will be borne by us and, indirectly, by our stockholders. You should understand that any such distributions are not based on our investment performance, and can only be sustained if we achieve positive investment performance in future periods and/or our Adviser continues to make such expense reimbursements. You should also understand that our future repayments may reduce the distributions that you would otherwise receive.

The Adviser and its affiliates face a number of conflicts with respect to us. Currently, affiliates of the Adviser manage other investment entities and are not prohibited from raising money for and managing future investment entities that make the same types of investments as those we target. As a result, the time and resources that the Adviser devotes to us may be diverted. In addition, we may compete with any such investment entity also managed by affiliates of the Adviser for the same investors and investment opportunities. Furthermore, the Adviser may face conflicts of interest with respect to services it may perform for companies in which we invest as it may receive fees in connection with such services that may not be shared with us. The incentive fee payable by us to the Adviser may create an incentive for the Adviser to make investments on our behalf that are risky or more speculative than would be the case in the absence of such compensation arrangements. We may be obligated to pay the Adviser incentive fees even if we incur a net loss due to a decline in the value of our portfolio and even if our earned interest income is not payable in cash.