UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-21467
(Exact name of registrant as specified in charter)
One Madison Avenue, 17th Floor, New York, NY 10010
(Address of principal executive offices) (Zip code)
Marc A. De Oliveira
Franklin Templeton
100 First Stamford Place
Stamford, CT 06902
(Name and address of agent for service)
Registrant’s telephone number, including area code: 1-888-777-0102
Date of fiscal year end: November 30
Date of reporting period:
| ITEM 1. | REPORT TO STOCKHOLDERS. |
(a) The Report to Shareholders is filed herewith
Semi-Annual
Report
May 31, 2026
LMP
CAPITAL AND INCOME
FUND INC. (SCD)
CAPITAL AND INCOME
FUND INC. (SCD)
If you need assistance
accessing this content, please reach out to your sales representative or send an email to accessibility@franklintempleton.com.
Managed
Distribution Policy: The
Fund’s Board of Directors (the “Board”) has authorized a
managed distribution plan pursuant to which the Fund makes monthly distributions to shareholders
at a fixed rate of $0.1200 per common share, which rate may be adjusted from time
to time by the Fund’s Board (the “Plan”). The Plan is intended to provide shareholders with
a constant, but not guaranteed, fixed minimum rate of distribution each month. The Fund
is managed with a goal of generating as much of the distribution as possible from net ordinary
income and short-term capital gains that is consistent with the Fund’s investment strategy
and risk profile. To the extent that sufficient distributable income is not available on
a monthly basis, the Fund will distribute long-term capital gains and/or return of capital in
order to maintain its managed distribution rate. A return of capital may occur, for example,
when some or all of the money that was invested in the Fund is paid back to shareholders.
A return of capital distribution does not necessarily reflect the Fund’s investment
performance and should not be confused with “yield” or “income”. Even though the
Fund may realize current year capital gains, such gains may be offset, in whole or in part,
by the Fund’s capital loss carryovers from prior years.
The Board may amend the terms of
the Plan or terminate the Plan at any time without prior notice
to the Fund’s shareholders; however, at this time there are no reasonably foreseeable circumstances
that might cause the termination of the Plan. The amendment or termination of
the Plan could have an adverse effect on the market price of the Fund’s common shares. The
Plan is subject to the periodic review by the Board to determine if an adjustment should be
made.
Shareholders should not draw any
conclusions about the Fund’s investment performance from
the amount of the current distribution or from the terms of the Fund’s Plan. The Fund will
send a Form 1099-DIV to shareholders for the calendar year that will describe how to report
the Fund’s distributions for federal income tax purposes.
Fund objective
The
Fund’s investment objective is total return with an emphasis on income.
The Fund may invest in a broad range of equity and fixed income securities of both U.S. and foreign issuers. The Fund will vary its allocation between equity and fixed income securities depending on the investment manager’s view of economic, market or political conditions, fiscal and monetary policy and security valuation.
The Fund may invest in a broad range of equity and fixed income securities of both U.S. and foreign issuers. The Fund will vary its allocation between equity and fixed income securities depending on the investment manager’s view of economic, market or political conditions, fiscal and monetary policy and security valuation.
What’s inside
|
III
| |
|
IV
| |
|
1
| |
|
2
| |
|
13
| |
|
14
| |
|
15
| |
|
16
| |
|
17
| |
|
20
| |
|
32
| |
|
39
| |
|
40
|
LMP
Capital and Income Fund Inc.
II
Letter
from the president
Dear Shareholder,
We are pleased to provide the semi-annual
report of LMP Capital and Income Fund Inc. for the six-month
reporting period ended May 31, 2026. Please read on for Fund performance information
during the Fund’s reporting period.
Special shareholder notices
Effective May 1, 2026, the named
portfolio management team responsible for the day-to-day
oversight of the Fund is as follows: from ClearBridge, Peter Vanderlee, Patrick McElroy; from
Western Asset, Michael Buchanan, Ryan Brist, Christopher Kilpatrick, Mark Lindbloom and
Walter Kilcullen.
Effective September 30, 2026, Christopher
Kilpatrick will no longer be a member of the portfolio
management team of the Fund.
As always, we remain committed to
providing you with excellent service and a full spectrum
of investment choices. We also remain committed to supplementing the support you
receive from your financial advisor. One way we accomplish this is through our website, www.franklintempleton.com.
Here you can gain immediate access to market and investment
information, including:
•
Fund
prices and performance,
•
Market
insights and commentaries from our portfolio managers, and
•
A
host of educational resources.
We look forward to helping you meet
your financial goals.
Sincerely,
Jane
Trust, CFA
President and Chief Executive Officer
President and Chief Executive Officer
June 30, 2026
III
LMP
Capital and Income Fund Inc.
Performance
review
For the six
months ended May 31, 2026, LMP Capital and Income Fund Inc. returned 9.18% based
on its net asset value (NAV)i
and 9.65% based on its New York Stock Exchange (NYSE)
market price per share. The Fund’s unmanaged benchmarks, the Bloomberg U.S. Aggregate
Indexii
and the S&P 500 Indexiii,
returned 0.23% and 11.34%, respectively, for the same
period. The Fund’s Composite Indexiv returned
7.48% over the same time frame.
The Fund has adopted a managed distribution
policy (the “Managed
Distribution Policy”).
Pursuant to this policy, the Fund intends to make regular
monthly distributions to common shareholders at a fixed
rate per common share, which rate may be adjusted from time to time
by the Fund’s Board of Directors. This policy has no impact on the Fund’s investment strategy
and may reduce the Fund’s NAV. The Fund’s manager believes the policy helps maintain
the Fund’s competitiveness and may benefit the Fund’s market price and premium/discount
to the Fund’s NAV.
During the six-month period, the
Fund made distributions to shareholders totaling $0.72 per share.
As of May 31, 2026, the Fund estimates that 11% of the distributions were sourced from
net investment income and 89% from realized capital gains.*
The performance table shows the Fund’s six-month
total return based on its NAV and market price as of May 31, 2026.
Past performance is no guarantee of future results.
|
Performance
Snapshot as of May 31, 2026 (unaudited)
| |
|
Price
Per Share |
6-Month
Total
Return** |
|
$17.27
(NAV) |
9.18
%†
|
|
$15.49
(Market Price) |
9.65
%‡
|
All figures represent past performance and are
not a guarantee of future results. Performance figures for periods
shorter than one year represent cumulative figures and are not annualized.
** Total returns are based on changes in NAV or
market price, respectively. Returns reflect the deduction of all Fund
expenses, including management fees, operating expenses, and other Fund expenses.
Returns do not reflect the deduction of brokerage commissions or taxes that investors may
pay on distributions or the sale of shares.
† Total return assumes the reinvestment of
all distributions, including returns of capital, if any, at NAV.
‡ Total return assumes the reinvestment of
all distributions, including returns of capital, if any, in additional
shares in accordance with the Fund’s Dividend Reinvestment Plan.
*
These
estimates are not for tax purposes. The Fund will issue a Form 1099 with final composition of the distributions
for tax purposes after year-end. A return of capital is not taxable and results in a reduction in the tax
basis of a shareholder’s investment. For more information about a distribution’s composition, please refer to the
Fund’s distribution press release or, if applicable, the Section 19 notice located in the press release section of
our website, www.franklintempleton.com.
LMP
Capital and Income Fund Inc.
IV
Performance
review (cont’d)
Looking for additional information?
The Fund is traded under the symbol
“SCD” and its closing market price is available in most newspapers
under the NYSE listings. The daily NAV is available online under the symbol “XSCDX”
on most financial websites. Barron’s and
The Wall Street Journal’s
Monday edition both carry closed-end fund tables that
provide additional information. In addition, the Fund
issues a quarterly press release that can be found on most major financial websites
as well as www.franklintempleton.com.
In a continuing effort to provide
information concerning the Fund, shareholders may call 1-888-777-0102
(toll free), Monday through Friday from 8:00 a.m. to 5:30 p.m. Eastern Time, for
the Fund’s current NAV, market price and other information.
Thank you for your investment in
the LMP Capital and Income Fund Inc. As always, we appreciate
that you have chosen us to manage your assets and we remain focused on achieving
the Fund’s investment goals.
Sincerely,
Jane
Trust, CFA
President and Chief Executive Officer
President and Chief Executive Officer
June 30, 2026
RISKS: The
Fund is a diversified, closed-end management investment company designed primarily
as a long-term investment and not as a trading vehicle. The Fund is not intended to be a
complete investment program and, due to the uncertainty inherent in all investments, there can be
no assurance that the Fund will achieve its investment objective. The Fund’s common stock is traded
on the New York Stock Exchange. Similar to stocks, the Fund’s share price will fluctuate with
market conditions and, at the time of sale, may be worth more or less than the original investment.
Shares of closed-end funds often trade at a discount to their net asset value. Diversification
does not assure against market loss. The Fund’s investments are subject to a number
of risks such as stock market and equity securities risk, MLP risk, fixed income securities risk,
foreign investments risk, market events risk and portfolio management risk. Investments in MLP
securities are subject to unique risks. The Fund’s concentration of investments in energy related
MLPs subjects it to the risks of MLPs and the energy sector, including the risks of declines
in energy and commodity prices, decreases in energy demand, adverse weather conditions,
natural or other disasters, changes in government regulation, and changes in tax laws.
MLP distributions are not guaranteed and there is no assurance that all such distributions will
be tax deferred. Stock and bond prices are subject to fluctuation. As interest rates rise, bond prices
fall, reducing the value of the fixed income securities held by the Fund. Investing in foreign
securities is subject to certain risks not associated with domestic investing, such as currency
fluctuations and changes in political, social, and economic conditions. These risks are
V
LMP
Capital and Income Fund Inc.
magnified in emerging
or developing markets. Emerging market countries tend to have economic, political,
and legal systems that are less developed and are less stable than those of more developed
countries. The Fund may invest in lower rated higher yielding bonds or “junk bonds”, which
are subject to greater liquidity and credit risk (risk of default) than higher rated obligations.
The repositioning of the Fund’s portfolio may increase a shareholder’s risk of loss associated
with an investment in the Fund’s shares. Funds that invest in securities related to the real
estate industry are subject to the risks of real estate markets, including fluctuating property values,
changes in interest rates and other mortgage-related risks. The Fund may use derivatives,
such as options and futures, which can be illiquid, may disproportionately increase losses,
and have a potentially large impact on Fund performance. Leverage may result in greater volatility
of NAV and the market price of common shares and increases a shareholder’s risk of loss.
Dividends are not guaranteed, and a company may reduce or eliminate its dividend at any time.
Distributions are not guaranteed and are subject to change. The Fund may also invest in money
market funds, including funds affiliated with the Fund’s manager and subadvisers. The market
values of securities or other assets will fluctuate, sometimes sharply and unpredictably, due
to changes in general market conditions, overall economic trends or events, governmental actions
or intervention, actions taken by the U.S. Federal Reserve or foreign central banks, market
disruptions caused by trade disputes or other factors, political developments, armed conflicts,
economic sanctions and countermeasures in response to sanctions, major cybersecurity
events, investor sentiment, the global and domestic effects of a pandemic, and other
factors that may or may not be related to the issuer of the security or other asset.
All investments are subject to risk
including the possible loss of principal. Past performance is no guarantee
of future results. All index performance reflects no deduction for fees, expenses or taxes. Please
note that an investor cannot invest directly in an index.
i
Net
asset value (NAV) is calculated by subtracting total liabilities, including liabilities associated with financial leverage
(if any), from the closing value of all securities held by the Fund (plus all other assets) and dividing the result
(total net assets) by the total number of the shares of common stock outstanding. The NAV fluctuates with changes
in the market prices of securities in which the Fund has invested. However, the price at which an investor may
buy or sell shares of the Fund is the Fund’s market price as determined by supply of and demand for the Fund’s shares.
ii
The
Bloomberg U.S. Aggregate Index is comprised of investment-grade, U.S. dollar-denominated government, corporate,
and mortgage- and asset-backed issues having at least one year to maturity.
iii
The
S&P 500 Index features 500 leading U.S. publicly traded companies, with a primary emphasis on market capitalization.
iv
The
Composite Index reflects the blended rate of return of the following underlying indices: 65% S&P 500 Index and 35%
Bloomberg U.S. Aggregate Index.
Important
data provider notices and terms available at www.franklintempletondatasources.com.
LMP
Capital and Income Fund Inc.
VI
(This
page intentionally left blank.)
Fund
at a glance† (unaudited)
Investment
breakdown (%) as a percent of total investments
†
The
bar graph above represents the composition of the Fund’s investments as of May 31, 2026, and November
30, 2025. The Fund is actively managed. As a result, the composition of the Fund’s investments is subject
to change at any time.
LMP
Capital and Income Fund Inc. 2026 Semi-Annual Report
1
Schedule
of investments (unaudited)
May 31, 2026
LMP
Capital and Income Fund Inc.
(Percentages shown
based on Fund net assets)
|
Security
|
|
|
|
Shares
|
Value
|
|
Common
Stocks — 101.3% | |||||
|
Communication
Services — 6.0% | |||||
|
Interactive
Media & Services — 4.5% | |||||
|
Alphabet
Inc., Class A Shares |
33,277
|
$12,656,574
(a)
| |||
|
Meta
Platforms Inc., Class A Shares |
8,023
|
5,074,628
| |||
|
Total
Interactive Media & Services |
17,731,202
| ||||
|
Wireless
Telecommunication Services — 1.5% | |||||
|
T-Mobile
US Inc. |
31,837
|
5,970,393
(a)
| |||
|
| |||||
|
Total
Communication Services |
23,701,595
| ||||
|
Consumer
Discretionary — 2.3% | |||||
|
Household
Durables — 1.5% | |||||
|
Lennar
Corp., Class A Shares |
67,208
|
6,033,934
(a)
| |||
|
Specialty
Retail — 0.8% | |||||
|
Home
Depot Inc. |
9,506
|
3,014,733
| |||
|
| |||||
|
Total
Consumer Discretionary |
9,048,667
| ||||
|
Consumer
Staples — 6.9% | |||||
|
Beverages
— 1.4% | |||||
|
Coca-Cola
Co. |
71,754
|
5,669,284
(a)
| |||
|
Consumer
Staples Distribution & Retail — 1.5% | |||||
|
Walmart
Inc. |
52,056
|
6,025,482
(a)
| |||
|
Household
Products — 4.0% | |||||
|
Colgate-Palmolive
Co. |
89,051
|
8,026,167
(a)
| |||
|
Procter
& Gamble Co. |
52,851
|
7,587,289
(a)
| |||
|
Total
Household Products |
15,613,456
| ||||
|
| |||||
|
Total
Consumer Staples |
27,308,222
| ||||
|
Energy
— 13.2% | |||||
|
Oil,
Gas & Consumable Fuels — 13.2% | |||||
|
Cheniere
Energy Inc. |
11,449
|
2,574,422
| |||
|
Enbridge
Inc. |
105,625
|
5,781,912
(a)
| |||
|
Kinder
Morgan Inc. |
221,911
|
6,896,994
(a)
| |||
|
ONEOK
Inc. |
90,575
|
7,602,865
(a)
| |||
|
Pembina
Pipeline Corp. |
127,391
|
5,930,051
(a)
| |||
|
SunocoCorp
LLC |
81,658
|
5,335,534
(a)
| |||
|
Targa
Resources Corp. |
20,358
|
5,192,715
(a)
| |||
|
Williams
Cos. Inc. |
184,209
|
13,150,681
(a)
| |||
|
| |||||
|
Total
Energy |
52,465,174
| ||||
|
Financials
— 11.7% | |||||
|
Banks
— 5.6% | |||||
|
Bank
of America Corp. |
129,907
|
6,703,201
(a)
| |||
|
Citigroup
Inc. |
52,984
|
6,670,686
(a)
| |||
See
Notes to Financial Statements.
2
LMP
Capital and Income Fund Inc. 2026 Semi-Annual Report
LMP
Capital and Income Fund Inc.
(Percentages shown
based on Fund net assets)
|
Security
|
|
|
|
Shares
|
Value
|
|
| |||||
|
Banks
— continued | |||||
|
JPMorgan
Chase & Co. |
28,805
|
$8,621,624
(a)
| |||
|
Total
Banks |
21,995,511
| ||||
|
Capital
Markets — 3.6% | |||||
|
Ares
Management Corp., Class A Shares |
11,327
|
1,455,520
| |||
|
Blackstone
Inc. |
16,266
|
1,902,634
| |||
|
Charles
Schwab Corp. |
25,336
|
2,213,100
(a)
| |||
|
Goldman
Sachs Group Inc. |
2,665
|
2,733,117
(a)
| |||
|
Intercontinental
Exchange Inc. |
39,686
|
5,867,575
(a)
| |||
|
Total
Capital Markets |
14,171,946
| ||||
|
Insurance
— 1.3% | |||||
|
MetLife
Inc. |
61,852
|
5,114,542
(a)
| |||
|
Mortgage
Real Estate Investment Trusts (REITs) — 1.2% | |||||
|
AGNC
Investment Corp. |
469,976
|
4,892,450
(a)
| |||
|
| |||||
|
Total
Financials |
46,174,449
| ||||
|
Health
Care — 8.2% | |||||
|
Biotechnology
— 1.3% | |||||
|
AbbVie
Inc. |
11,960
|
2,603,931
(a)
| |||
|
Amgen
Inc. |
7,298
|
2,457,894
| |||
|
Total
Biotechnology |
5,061,825
| ||||
|
Health
Care Providers & Services — 1.3% | |||||
|
McKesson
Corp. |
7,157
|
5,313,643
| |||
|
Pharmaceuticals
— 5.6% | |||||
|
Eli
Lilly & Co. |
2,888
|
3,191,240
| |||
|
Johnson
& Johnson |
24,204
|
5,453,887
(a)
| |||
|
Merck
& Co. Inc. |
56,499
|
6,707,561
(a)
| |||
|
Roche
Holding AG, ADR |
130,859
|
6,857,012
| |||
|
Total
Pharmaceuticals |
22,209,700
| ||||
|
| |||||
|
Total
Health Care |
32,585,168
| ||||
|
Industrials
— 13.6% | |||||
|
Aerospace
& Defense — 2.9% | |||||
|
L3Harris
Technologies Inc. |
15,004
|
4,728,961
(a)
| |||
|
Lockheed
Martin Corp. |
5,605
|
2,973,172
(a)
| |||
|
Northrop
Grumman Corp. |
6,611
|
3,726,488
| |||
|
Total
Aerospace & Defense |
11,428,621
| ||||
|
Electrical
Equipment — 4.5% | |||||
|
Eaton
Corp. PLC |
21,507
|
8,615,704
(a)
| |||
|
Emerson
Electric Co. |
63,874
|
9,186,359
(a)
| |||
|
Total
Electrical Equipment |
17,802,063
| ||||
|
Ground
Transportation — 2.7% | |||||
|
Union
Pacific Corp. |
40,491
|
10,634,556
(a)
| |||
See
Notes to Financial Statements.
LMP
Capital and Income Fund Inc. 2026 Semi-Annual Report
3
Schedule
of investments (unaudited) (cont’d)
May 31, 2026
LMP
Capital and Income Fund Inc.
(Percentages shown
based on Fund net assets)
|
Security
|
|
|
|
Shares
|
Value
|
|
| |||||
|
Industrial
Conglomerates — 2.0% | |||||
|
Honeywell
International Inc. |
33,080
|
$7,868,409
(a)
| |||
|
Machinery
— 1.5% | |||||
|
Illinois
Tool Works Inc. |
24,120
|
5,964,394
| |||
|
| |||||
|
Total
Industrials |
53,698,043
| ||||
|
Information
Technology — 21.4% | |||||
|
Electronic
Equipment, Instruments & Components — 1.8% | |||||
|
Amphenol
Corp., Class A Shares |
48,328
|
7,189,273
(a)
| |||
|
Semiconductors
& Semiconductor Equipment — 9.2% | |||||
|
ASML
Holding NV, Registered Shares |
3,807
|
6,139,777
(a)
| |||
|
Broadcom
Inc. |
18,568
|
8,295,626
(a)
| |||
|
Marvell
Technology Inc. |
25,953
|
5,320,365
(a)
| |||
|
Micron
Technology Inc. |
12,001
|
11,652,971
| |||
|
QUALCOMM
Inc. |
19,458
|
4,884,347
(a)
| |||
|
Total
Semiconductors & Semiconductor Equipment |
36,293,086
| ||||
|
Software
— 4.9% | |||||
|
Microsoft
Corp. |
30,065
|
13,536,466
(a)
| |||
|
Oracle
Corp. |
26,477
|
5,977,977
(a)
| |||
|
Total
Software |
19,514,443
| ||||
|
Technology
Hardware, Storage & Peripherals — 5.5% | |||||
|
Apple
Inc. |
49,544
|
15,460,701
(a)
| |||
|
Western
Digital Corp. |
11,621
|
6,173,191
| |||
|
Total
Technology Hardware, Storage & Peripherals |
21,633,892
| ||||
|
| |||||
|
Total
Information Technology |
84,630,694
| ||||
|
Materials
— 2.4% | |||||
|
Chemicals
— 0.6% | |||||
|
Sherwin-Williams
Co. |
7,234
|
2,197,978
| |||
|
Metals
& Mining — 1.8% | |||||
|
Freeport-McMoRan
Inc. |
111,035
|
7,296,110
(a)
| |||
|
| |||||
|
Total
Materials |
9,494,088
| ||||
|
Real
Estate — 11.4% | |||||
|
Industrial
REITs — 1.5% | |||||
|
Prologis
Inc. |
41,046
|
5,888,869
(a)
| |||
|
Residential
REITs — 3.6% | |||||
|
Equity
LifeStyle Properties Inc. |
120,540
|
7,445,756
(a)
| |||
|
Equity
Residential |
108,351
|
7,091,573
(a)
| |||
|
Total
Residential REITs |
14,537,329
| ||||
|
Specialized
REITs — 6.3% | |||||
|
American
Tower Corp. |
45,306
|
8,470,410
(a)
| |||
|
Digital
Realty Trust Inc. |
40,284
|
7,653,960
(a)
| |||
See
Notes to Financial Statements.
4
LMP
Capital and Income Fund Inc. 2026 Semi-Annual Report
LMP
Capital and Income Fund Inc.
(Percentages shown
based on Fund net assets)
|
Security
|
|
|
|
Shares
|
Value
|
|
| |||||
|
Specialized
REITs — continued | |||||
|
Equinix
Inc. |
2,766
|
$2,954,199
(a)
| |||
|
Public
Storage |
18,950
|
5,754,925
| |||
|
Total
Specialized REITs |
24,833,494
| ||||
|
| |||||
|
Total
Real Estate |
45,259,692
| ||||
|
Utilities
— 4.2% | |||||
|
Gas
Utilities — 1.8% | |||||
|
Atmos
Energy Corp. |
40,814
|
6,902,872
(a)
| |||
|
Multi-Utilities
— 2.4% | |||||
|
DTE
Energy Co. |
66,964
|
9,567,147
(a)
| |||
|
| |||||
|
Total
Utilities |
16,470,019
| ||||
|
Total
Common Stocks (Cost — $299,808,454) |
400,835,811
| ||||
|
|
|
|
|
Shares/Units
|
|
|
Master
Limited Partnerships — 11.3% | |||||
|
Diversified
Energy Infrastructure — 5.7% | |||||
|
Energy
Transfer LP |
467,937
|
8,970,352
(a)
| |||
|
Enterprise
Products Partners LP |
182,447
|
6,712,225
(a)
| |||
|
Plains
GP Holdings LP, Class A Shares |
282,899
|
6,888,591
*(a)
| |||
|
Total
Diversified Energy Infrastructure |
22,571,168
| ||||
|
Gathering/Processing
— 0.6% | |||||
|
Western
Midstream Partners LP |
56,000
|
2,400,720
(a)
| |||
|
Liquids
Transportation & Storage — 0.9% | |||||
|
Delek
Logistics Partners LP |
65,948
|
3,256,513
(a)
| |||
|
Oil/Refined
Products — 2.1% | |||||
|
CrossAmerica
Partners LP |
135,864
|
2,937,380
(a)
| |||
|
MPLX
LP |
99,696
|
5,448,386
(a)
| |||
|
Total
Oil/Refined Products |
8,385,766
| ||||
|
Petrochemicals
— 2.0% | |||||
|
Westlake
Chemical Partners LP |
348,827
|
7,998,603
(a)
| |||
|
| |||||
|
Total
Master Limited Partnerships (Cost — $17,425,304) |
44,612,770
| ||||
|
|
|
Rate
|
|
Shares
|
|
|
Convertible
Preferred Stocks — 7.2% | |||||
|
Consumer
Discretionary — 2.7% | |||||
|
Building
Products — 2.7% | |||||
|
QXO
Inc. |
4.750%
|
|
1,000
|
10,881,860
(b)(c)
| |
|
| |||||
|
Financials
— 2.4% | |||||
|
Capital
Markets — 1.1% | |||||
|
KKR
& Co. Inc. |
6.250%
|
|
100,590
|
4,200,638
| |
See
Notes to Financial Statements.
LMP
Capital and Income Fund Inc. 2026 Semi-Annual Report
5
Schedule
of investments (unaudited) (cont’d)
May 31, 2026
LMP
Capital and Income Fund Inc.
(Percentages shown
based on Fund net assets)
|
Security
|
|
Rate
|
|
Shares
|
Value
|
|
| |||||
|
Financial
Services — 1.3% | |||||
|
Apollo
Global Management Inc. |
6.750%
|
|
78,666
|
$5,184,876
| |
|
| |||||
|
Total
Financials |
9,385,514
| ||||
|
Industrials
— 2.1% | |||||
|
Aerospace
& Defense — 2.1% | |||||
|
Boeing
Co. |
6.000%
|
|
114,383
|
8,249,302
| |
|
| |||||
|
Total
Convertible Preferred Stocks (Cost — $25,755,647) |
28,516,676
| ||||
|
|
|
|
Maturity
Date
|
Face
Amount
|
|
|
Corporate
Bonds & Notes — 4.3% | |||||
|
Communication
Services — 0.6% | |||||
|
Diversified
Telecommunication Services — 0.0%†† | |||||
|
WULF
Compute LLC, Senior Secured Notes |
7.750%
|
10/15/30
|
$40,000
|
42,054
(d)
| |
|
Entertainment
— 0.3% | |||||
|
Discovery
Global Holdings Inc., Senior Notes |
4.279%
|
3/15/32
|
20,000
|
18,075
| |
|
Discovery
Global Holdings Inc., Senior Notes |
5.050%
|
3/15/42
|
20,000
|
14,675
| |
|
Flutter
Treasury DAC, Senior Secured Notes |
5.875%
|
6/4/31
|
200,000
|
197,836
(d)
| |
|
Netflix
Inc., Senior Notes |
5.375%
|
11/15/29
|
400,000
|
411,858
(d)
| |
|
Walt
Disney Co., Senior Notes |
2.000%
|
9/1/29
|
600,000
|
558,011
| |
|
Total
Entertainment |
1,200,455
| ||||
|
Media
— 0.2% | |||||
|
CCO
Holdings LLC/CCO Holdings Capital Corp.,
Senior
Notes |
7.375%
|
2/1/36
|
240,000
|
234,523
(d)
| |
|
Comcast
Corp., Senior Notes |
4.250%
|
10/15/30
|
550,000
|
543,590
| |
|
Fox
Corp., Senior Notes |
6.500%
|
10/13/33
|
20,000
|
21,532
| |
|
Nexstar
Media Inc., Senior Secured Notes |
6.500%
|
9/15/33
|
10,000
|
10,087
(d)
| |
|
Versant
Media Group Inc., Senior Secured
Notes
|
7.250%
|
1/30/31
|
30,000
|
31,186
(d)
| |
|
Total
Media |
840,918
| ||||
|
Wireless
Telecommunication Services — 0.1% | |||||
|
T-Mobile
USA Inc., Senior Notes |
3.875%
|
4/15/30
|
500,000
|
486,633
| |
|
| |||||
|
Total
Communication Services |
2,570,060
| ||||
|
Consumer
Discretionary — 0.5% | |||||
|
Automobile
Components — 0.0%†† | |||||
|
American
Axle & Manufacturing Inc., Senior
Secured
Notes |
6.375%
|
10/15/32
|
40,000
|
40,174
(d)
| |
|
Cyprium
Corp./Cyprium Holdings Luxembourg
Sarl,
Senior Notes |
6.375%
|
4/15/34
|
40,000
|
40,018
(d)
| |
|
ZF
North America Capital Inc., Senior Notes |
6.750%
|
4/23/30
|
150,000
|
149,427
(d)
| |
|
Total
Automobile Components |
229,619
| ||||
See
Notes to Financial Statements.
6
LMP
Capital and Income Fund Inc. 2026 Semi-Annual Report
LMP
Capital and Income Fund Inc.
(Percentages shown
based on Fund net assets)
|
Security
|
|
Rate
|
Maturity
Date
|
Face
Amount
|
Value
|
|
| |||||
|
Automobiles
— 0.1% | |||||
|
Ford
Motor Co., Senior Notes |
3.250%
|
2/12/32
|
$50,000
|
$44,382
| |
|
General
Motors Financial Co. Inc., Senior Notes |
4.350%
|
1/17/27
|
250,000
|
249,881
| |
|
Total
Automobiles |
294,263
| ||||
|
Broadline
Retail — 0.1% | |||||
|
Amazon.com
Inc., Senior Notes |
2.100%
|
5/12/31
|
550,000
|
492,462
| |
|
Hotels,
Restaurants & Leisure — 0.2% | |||||
|
Brightstar
Lottery PLC/Brightstar Global
Solutions
Corp., Senior Secured Notes |
5.750%
|
1/15/33
|
20,000
|
19,429
(d)
| |
|
Carnival
Corp. Ltd., Senior Notes |
6.125%
|
2/15/33
|
210,000
|
212,869
(d)
| |
|
Las
Vegas Sands Corp., Senior Notes |
5.625%
|
6/15/28
|
10,000
|
10,146
| |
|
Las
Vegas Sands Corp., Senior Notes |
6.000%
|
6/14/30
|
290,000
|
299,220
| |
|
Viking
Cruises Ltd., Senior Notes |
5.875%
|
10/15/33
|
140,000
|
140,364
(d)
| |
|
Total
Hotels, Restaurants & Leisure |
682,028
| ||||
|
Specialty
Retail — 0.1% | |||||
|
Academy
Ltd., Senior Secured Notes |
5.875%
|
5/15/31
|
20,000
|
20,134
(d)
| |
|
Home
Depot Inc., Senior Notes |
2.700%
|
4/15/30
|
300,000
|
282,438
| |
|
Total
Specialty Retail |
302,572
| ||||
|
| |||||
|
Total
Consumer Discretionary |
2,000,944
| ||||
|
Consumer
Staples — 0.1% | |||||
|
Personal
Care Products — 0.1% | |||||
|
Kenvue
Inc., Senior Notes |
4.900%
|
3/22/33
|
400,000
|
402,834
| |
|
| |||||
|
Financials
— 1.4% | |||||
|
Banks
— 0.8% | |||||
|
Bank
of America Corp., Senior Notes (5.015% to
7/22/32
then SOFR + 2.160%) |
5.015%
|
7/22/33
|
600,000
|
603,338
(e)
| |
|
BNP
Paribas SA, Senior Notes (5.894% to
12/5/33
then SOFR + 1.866%) |
5.894%
|
12/5/34
|
250,000
|
262,234
(d)(e)
| |
|
Citigroup
Inc., Subordinated Notes (6.174% to
5/25/33
then SOFR + 2.661%) |
6.174%
|
5/25/34
|
700,000
|
732,868
(e)
| |
|
JPMorgan
Chase & Co., Subordinated Notes
(5.717%
to 9/14/32 then SOFR + 2.580%) |
5.717%
|
9/14/33
|
700,000
|
723,833
(e)
| |
|
Truist
Financial Corp., Senior Notes (5.711% to
1/24/34
then SOFR + 1.922%) |
5.711%
|
1/24/35
|
300,000
|
309,261
(e)
| |
|
Wells
Fargo & Co., Senior Notes (4.897% to
7/25/32
then SOFR + 2.100%) |
4.897%
|
7/25/33
|
500,000
|
497,967
(e)
| |
|
Total
Banks |
3,129,501
| ||||
|
Capital
Markets — 0.0%†† | |||||
|
StoneX
Escrow Issuer LLC, Secured Notes |
6.875%
|
7/15/32
|
30,000
|
30,978
(d)
| |
See
Notes to Financial Statements.
LMP
Capital and Income Fund Inc. 2026 Semi-Annual Report
7
Schedule
of investments (unaudited) (cont’d)
May 31, 2026
LMP
Capital and Income Fund Inc.
(Percentages shown
based on Fund net assets)
|
Security
|
|
Rate
|
Maturity
Date
|
Face
Amount
|
Value
|
|
| |||||
|
Consumer
Finance — 0.2% | |||||
|
American
Express Co., Senior Notes (5.043% to
5/1/33
then SOFR + 1.835%) |
5.043%
|
5/1/34
|
$500,000
|
$502,150
(e)
| |
|
EZCORP
Inc., Senior Notes |
7.375%
|
4/1/32
|
30,000
|
31,831
(d)
| |
|
Midcap
Financial Issuer Trust, Junior
Subordinated
Notes (3 mo. Term SOFR +
3.750%)
|
7.423%
|
1/15/56
|
200,000
|
198,325
(d)(e)
| |
|
Total
Consumer Finance |
732,306
| ||||
|
Financial
Services — 0.3% | |||||
|
AerCap
Ireland Capital DAC/AerCap Global
Aviation
Trust, Senior Notes |
3.300%
|
1/30/32
|
300,000
|
274,584
| |
|
AerCap
Ireland Capital DAC/AerCap Global
Aviation
Trust, Senior Notes |
5.000%
|
11/15/35
|
700,000
|
679,858
| |
|
Block
Inc., Senior Notes |
6.000%
|
8/15/33
|
50,000
|
50,054
(d)
| |
|
Jane
Street Group/JSG Finance Inc., Senior
Secured
Notes |
6.750%
|
5/1/33
|
140,000
|
144,074
(d)
| |
|
Rocket
Cos. Inc., Senior Notes |
6.125%
|
8/1/30
|
40,000
|
40,633
(d)
| |
|
Total
Financial Services |
1,189,203
| ||||
|
Insurance
— 0.0%†† | |||||
|
APH
Somerset Investor 2 LLC/APH2 Somerset
Investor
2 LLC/APH3 Somerset Investor 2 LLC,
Senior
Notes |
7.875%
|
11/1/29
|
50,000
|
50,228
(d)
| |
|
Asurion
LLC/Asurion Co-Issuer Inc., Senior
Secured
Notes |
8.000%
|
12/31/32
|
90,000
|
93,913
(d)
| |
|
Total
Insurance |
144,141
| ||||
|
Mortgage
Real Estate Investment Trusts (REITs) — 0.1% | |||||
|
Arbor
Realty SR Inc., Senior Notes |
8.500%
|
12/15/28
|
60,000
|
59,433
(d)
| |
|
Ladder
Capital Finance Holdings LLLP/Ladder
Capital
Finance Corp., Senior Notes |
7.000%
|
7/15/31
|
280,000
|
290,223
(d)
| |
|
Total
Mortgage Real Estate Investment Trusts (REITs) |
349,656
| ||||
|
| |||||
|
Total
Financials |
5,575,785
| ||||
|
Health
Care — 0.7% | |||||
|
Biotechnology
— 0.2% | |||||
|
Amgen
Inc., Senior Notes |
5.250%
|
3/2/33
|
550,000
|
561,961
| |
|
Health
Care Providers & Services — 0.3% | |||||
|
Cigna
Group, Senior Notes |
2.400%
|
3/15/30
|
348,000
|
321,980
| |
|
CVS
Health Corp., Senior Notes |
3.750%
|
4/1/30
|
600,000
|
581,424
| |
|
HCA
Inc., Senior Notes |
5.625%
|
9/1/28
|
400,000
|
407,546
| |
|
Tenet
Healthcare Corp., Senior Secured Notes |
5.500%
|
11/15/32
|
40,000
|
39,863
(d)
| |
|
Total
Health Care Providers & Services |
1,350,813
| ||||
See
Notes to Financial Statements.
8
LMP
Capital and Income Fund Inc. 2026 Semi-Annual Report
LMP
Capital and Income Fund Inc.
(Percentages shown
based on Fund net assets)
|
Security
|
|
Rate
|
Maturity
Date
|
Face
Amount
|
Value
|
|
| |||||
|
Pharmaceuticals
— 0.2% | |||||
|
Pfizer
Investment Enterprises Pte Ltd., Senior
Notes
|
4.750%
|
5/19/33
|
$550,000
|
$547,121
| |
|
Teva
Pharmaceutical Finance Netherlands III BV,
Senior
Notes |
6.000%
|
12/1/32
|
200,000
|
207,867
| |
|
Total
Pharmaceuticals |
754,988
| ||||
|
| |||||
|
Total
Health Care |
2,667,762
| ||||
|
Industrials
— 0.4% | |||||
|
Aerospace
& Defense — 0.2% | |||||
|
AAR
Escrow Issuer LLC, Senior Notes |
6.750%
|
3/15/29
|
50,000
|
51,390
(d)
| |
|
Axon
Enterprise Inc., Senior Notes |
6.250%
|
3/15/33
|
20,000
|
20,510
(d)
| |
|
Northrop
Grumman Corp., Senior Notes |
4.750%
|
6/1/43
|
500,000
|
457,056
| |
|
Total
Aerospace & Defense |
528,956
| ||||
|
Building
Products — 0.0%†† | |||||
|
Advanced
Drainage Systems Inc., Senior Notes |
5.375%
|
3/1/34
|
40,000
|
39,068
(d)
| |
|
Quikrete
Holdings Inc., Senior Secured Notes |
6.375%
|
3/1/32
|
20,000
|
20,379
(d)
| |
|
Total
Building Products |
59,447
| ||||
|
Commercial
Services & Supplies — 0.0%†† | |||||
|
CoreCivic
Inc., Senior Notes |
8.250%
|
4/15/29
|
80,000
|
83,438
| |
|
Deluxe
Corp., Senior Secured Notes |
8.125%
|
9/15/29
|
30,000
|
31,360
(d)
| |
|
Total
Commercial Services & Supplies |
114,798
| ||||
|
Construction
& Engineering — 0.0%†† | |||||
|
AECOM,
Senior Notes |
6.000%
|
8/1/33
|
80,000
|
80,179
(d)
| |
|
Ground
Transportation — 0.1% | |||||
|
XPO
Inc., Senior Secured Notes |
6.250%
|
6/1/28
|
350,000
|
355,036
(d)
| |
|
Machinery
— 0.0%†† | |||||
|
Columbus
McKinnon Corp., Senior Secured
Notes
|
7.125%
|
2/1/33
|
20,000
|
20,282
(d)
| |
|
Passenger
Airlines — 0.0%†† | |||||
|
American
Airlines Pass-Through Trust |
5.750%
|
5/10/35
|
50,000
|
49,803
| |
|
Trading
Companies & Distributors — 0.1% | |||||
|
Herc
Holdings Inc., Senior Notes |
7.250%
|
6/15/33
|
40,000
|
41,767
(d)
| |
|
QXO
Building Products Inc., Senior Secured
Notes
|
6.750%
|
4/30/32
|
60,000
|
61,176
(d)
| |
|
United
Rentals North America Inc., Senior
Notes
|
3.750%
|
1/15/32
|
230,000
|
212,910
| |
|
Total
Trading Companies & Distributors |
315,853
| ||||
|
| |||||
|
Total
Industrials |
1,524,354
| ||||
See
Notes to Financial Statements.
LMP
Capital and Income Fund Inc. 2026 Semi-Annual Report
9
Schedule
of investments (unaudited) (cont’d)
May 31, 2026
LMP
Capital and Income Fund Inc.
(Percentages shown
based on Fund net assets)
|
Security
|
|
Rate
|
Maturity
Date
|
Face
Amount
|
Value
|
|
| |||||
|
Information
Technology — 0.1% | |||||
|
IT
Services — 0.1% | |||||
|
APLD
ComputeCo LLC, Senior Secured Notes |
9.250%
|
12/15/30
|
$70,000
|
$75,602
(d)
| |
|
Core
Scientific Finance I LLC, Senior Secured
Notes
|
7.750%
|
5/15/31
|
110,000
|
112,552
(d)
| |
|
Shift4
Payments LLC/Shift4 Payments Finance
Sub
Inc., Senior Notes |
6.750%
|
8/15/32
|
30,000
|
30,004
(d)
| |
|
Total
IT Services |
218,158
| ||||
|
Semiconductors
& Semiconductor Equipment — 0.0%†† | |||||
|
Amkor
Technology Inc., Senior Notes |
5.875%
|
10/1/33
|
80,000
|
80,467
(d)
| |
|
Qnity
Electronics Inc., Senior Secured Notes |
5.750%
|
8/15/32
|
50,000
|
50,388
(d)
| |
|
Total
Semiconductors & Semiconductor Equipment |
130,855
| ||||
|
Software
— 0.0%†† | |||||
|
Fair
Isaac Corp., Senior Notes |
6.250%
|
9/15/34
|
30,000
|
29,785
(d)
| |
|
Gen
Digital Inc., Senior Notes |
6.250%
|
4/1/33
|
20,000
|
19,937
(d)
| |
|
Oracle
Corp., Senior Notes |
6.000%
|
8/3/55
|
50,000
|
43,872
| |
|
Total
Software |
93,594
| ||||
|
Technology
Hardware, Storage & Peripherals — 0.0%†† | |||||
|
Black
Pearl Compute LLC, Senior Secured Notes |
6.125%
|
2/15/31
|
20,000
|
20,373
(d)
| |
|
Seagate
Data Storage Technology Pte Ltd.,
Senior
Notes |
5.875%
|
7/15/30
|
50,000
|
50,991
(d)
| |
|
Total
Technology Hardware, Storage & Peripherals |
71,364
| ||||
|
| |||||
|
Total
Information Technology |
513,971
| ||||
|
Materials
— 0.3% | |||||
|
Chemicals
— 0.0%†† | |||||
|
Celanese
US Holdings LLC, Senior Notes |
7.000%
|
2/15/31
|
10,000
|
10,373
| |
|
Celanese
US Holdings LLC, Senior Notes |
6.750%
|
4/15/33
|
60,000
|
61,959
| |
|
Methanex
US Operations Inc., Senior Notes |
6.250%
|
3/15/32
|
50,000
|
51,511
(d)
| |
|
Total
Chemicals |
123,843
| ||||
|
Construction
Materials — 0.0%†† | |||||
|
Standard
Building Solutions Inc., Senior Notes |
6.250%
|
8/1/33
|
50,000
|
50,112
(d)
| |
|
Metals
& Mining — 0.3% | |||||
|
Capstone
Copper Corp., Senior Notes |
6.750%
|
3/31/33
|
80,000
|
81,635
(d)
| |
|
Freeport-McMoRan
Inc., Senior Notes |
5.450%
|
3/15/43
|
500,000
|
486,222
| |
|
Glencore
Funding LLC, Senior Notes |
5.673%
|
4/1/35
|
160,000
|
164,673
(d)
| |
|
Glencore
Funding LLC, Senior Notes |
6.141%
|
4/1/55
|
220,000
|
226,927
(d)
| |
|
Total
Metals & Mining |
959,457
| ||||
|
| |||||
|
Total
Materials |
1,133,412
| ||||
See
Notes to Financial Statements.
10
LMP
Capital and Income Fund Inc. 2026 Semi-Annual Report
LMP
Capital and Income Fund Inc.
(Percentages shown
based on Fund net assets)
|
Security
|
|
Rate
|
Maturity
Date
|
Face
Amount
|
Value
|
|
| |||||
|
Real
Estate — 0.1% | |||||
|
Real
Estate Management & Development — 0.0%†† | |||||
|
Forestar
Group Inc., Senior Notes |
6.500%
|
3/15/33
|
$60,000
|
$60,269
(d)
| |
|
Specialized
REITs — 0.1% | |||||
|
Meridian
Arc Holdco LLC, Senior Secured Notes |
6.250%
|
4/30/31
|
40,000
|
40,227
(d)
| |
|
Millrose
Properties Inc., Senior Notes |
6.375%
|
8/1/30
|
60,000
|
60,886
(d)
| |
|
Millrose
Properties Inc., Senior Notes |
6.250%
|
9/15/32
|
10,000
|
10,056
(d)
| |
|
SV
RNO Property Owner 1 LLC, Senior Secured
Notes
|
5.875%
|
3/1/31
|
90,000
|
88,924
(d)
| |
|
Total
Specialized REITs |
200,093
| ||||
|
| |||||
|
Total
Real Estate |
260,362
| ||||
|
Utilities
— 0.1% | |||||
|
Electric
Utilities — 0.1% | |||||
|
NRG
Energy Inc., Senior Notes |
6.000%
|
1/15/36
|
90,000
|
89,458
(d)
| |
|
Pacific
Gas and Electric Co., First Mortgage
Bonds
|
5.800%
|
5/15/34
|
270,000
|
276,463
| |
|
| |||||
|
Total
Corporate Bonds & Notes (Cost — $16,826,160) |
17,015,405
| ||||
|
|
|
Rate
|
|
Face
Amount
|
|
|
U.S.
Government & Agency Obligations — 0.1% | |||||
|
U.S.
Government Obligations — 0.1% | |||||
|
U.S.
Treasury Notes (Cost — $168,360) |
3.875%
|
8/15/34
|
$170,000
|
164,402
| |
|
Total
Investments before Short-Term Investments (Cost — $359,983,925) |
491,145,064
| ||||
|
|
|
|
|
Shares
|
|
|
Short-Term
Investments — 2.3% | |||||
|
BNY
Dreyfus Government Cash Management,
Institutional
Shares |
3.518%
|
|
257,092
|
257,092
(f)
| |
|
JPMorgan
100% U.S. Treasury Securities
Money
Market Fund, Institutional Class |
3.482%
|
|
8,880,919
|
8,880,919
(f)
| |
|
| |||||
|
Total
Short-Term Investments (Cost — $9,138,011) |
9,138,011
| ||||
|
Total
Investments — 126.5% (Cost — $369,121,936) |
500,283,075
| ||||
|
Liabilities
in Excess of Other Assets — (26.5)% |
(104,731,128
) | ||||
|
Total
Net Assets — 100.0% |
$395,551,947
| ||||
See
Notes to Financial Statements.
LMP
Capital and Income Fund Inc. 2026 Semi-Annual Report
11
Schedule
of investments (unaudited) (cont’d)
May 31, 2026
LMP
Capital and Income Fund Inc.
|
††
|
Represents
less than 0.1%. |
|
*
|
Non-income
producing security. |
|
(a)
|
All
or a portion of this security is pledged as collateral pursuant to the loan agreement (Note
5). |
|
(b)
|
Security
is fair valued in accordance with procedures approved by the Board of Directors (Note
1). |
|
(c)
|
Security
is valued using significant unobservable inputs (Note
1). |
|
(d)
|
Security
is exempt from registration under Rule 144A of the Securities Act of 1933. This security may be resold in
transactions
that are exempt from registration, normally to qualified institutional buyers. This security has been
deemed
liquid pursuant to guidelines approved by the Board of Directors. |
|
(e)
|
Variable
rate security. Interest rate disclosed is as of the most recent information available. Certain variable rate
securities
are not based on a published reference rate and spread but are determined by the issuer or agent and
are
based on current market conditions. These securities do not indicate a reference rate and spread in their
description
above. |
|
(f)
|
Rate
shown is one-day yield as of the end of the reporting period.
|
|
Abbreviation(s)
used in this schedule: | ||
|
ADR
|
—
|
American
Depositary Receipts |
|
DAC
|
—
|
Designated
Activity Company |
|
SOFR
|
—
|
Secured
Overnight Financing Rate |
See
Notes to Financial Statements.
12
LMP
Capital and Income Fund Inc. 2026 Semi-Annual Report
Statement
of assets and liabilities (unaudited)
May 31, 2026
|
Assets:
|
|
|
Investments,
at value (Cost — $369,121,936) |
$500,283,075
|
|
Cash
|
978,500
|
|
Dividends
and interest receivable |
969,606
|
|
Deferred
offering costs (Notes
8 and 9) |
238,033
|
|
Receivable
for securities sold
|
10,300
|
|
Prepaid
expenses |
7,304
|
|
Total
Assets |
502,486,818
|
|
Liabilities:
|
|
|
Loan
payable (Note
5) |
105,000,000
|
|
Payable
for securities purchased |
1,337,019
|
|
Investment
management fee payable |
359,037
|
|
Interest
and commitment fees payable |
39,523
|
|
Accrued
expenses |
199,292
|
|
Total
Liabilities |
106,934,871
|
|
Total
Net Assets |
$395,551,947
|
|
Net
Assets: |
|
|
Par
value ($0.001 par value; 22,906,336 shares issued and outstanding; 100,000,000 shares
authorized)
|
$22,906
|
|
Paid-in
capital in excess of par value |
243,149,331
|
|
Total
distributable earnings (loss)
|
152,379,710
|
|
Total
Net Assets |
$395,551,947
|
|
Shares
Outstanding |
22,906,336
|
|
Net
Asset Value |
$17.27
|
See
Notes to Financial Statements.
LMP
Capital and Income Fund Inc. 2026 Semi-Annual Report
13
Statement
of operations (unaudited)
For the Six Months Ended May 31,
2026
|
Investment
Income: |
|
|
Dividends and distributions
|
$5,436,887
|
|
Interest
|
462,415
|
|
Less:
Foreign taxes withheld |
(72,308
) |
|
Total
Investment Income |
5,826,994
|
|
Expenses:
|
|
|
Interest
expense (Note
5) |
2,124,976
|
|
Investment
management fee (Note
2) |
2,026,375
|
|
Legal
fees |
59,760
|
|
Directors’
fees |
54,480
|
|
Shareholder
reports |
41,667
|
|
Fund
accounting fees |
41,604
|
|
Audit
and tax fees |
35,582
|
|
Transfer
agent fees |
30,568
|
|
Commitment
fees (Note
5) |
7,622
|
|
Stock
exchange listing fees |
6,240
|
|
Custody
fees |
1,628
|
|
Insurance
|
899
|
|
Miscellaneous
expenses |
11,502
|
|
Total
Expenses |
4,442,903
|
|
Net
Investment Income |
1,384,091
|
|
Realized
and Unrealized Gain (Loss) on Investments and Foreign Currency Transactions
(Notes
1 and 3): | |
|
Net
Realized Gain (Loss) From: |
|
|
Investment
transactions |
5,122,358
|
|
Foreign
currency transactions |
(688
) |
|
Net
Realized Gain
|
5,121,670
|
|
Change
in Net Unrealized Appreciation (Depreciation) From: |
|
|
Investments
|
27,417,612
|
|
Foreign
currencies |
(367
) |
|
Change
in Net Unrealized Appreciation (Depreciation)
|
27,417,245
|
|
Net
Gain on Investments and Foreign Currency Transactions
|
32,538,915
|
|
Increase
in Net Assets From Operations |
$33,923,006
|
See
Notes to Financial Statements.
14
LMP
Capital and Income Fund Inc. 2026 Semi-Annual Report
Statements
of changes in net assets
|
For
the Six Months Ended May 31, 2026 (unaudited)
and
the Year Ended November 30, 2025 |
2026
|
2025
|
|
Operations:
|
|
|
|
Net
investment income
|
$1,384,091
|
$3,917,606
|
|
Net
realized gain
|
5,121,670
|
46,466,973
|
|
Change
in net unrealized appreciation (depreciation)
|
27,417,245
|
(51,204,785
) |
|
Increase
(Decrease) in Net Assets From Operations |
33,923,006
|
(820,206
) |
|
Distributions
to Shareholders From (Note
1): |
|
|
|
Total
distributable earnings |
(16,492,562
) |
(27,789,960
) |
|
Decrease
in Net Assets From Distributions to Shareholders |
(16,492,562
) |
(27,789,960
) |
|
Fund
Share Transactions: |
|
|
|
Net
proceeds from sale of shares from shelf registration (0 and 43,207
shares
issued, respectively)† (Note
8) |
(17,530
) |
710,553
|
|
Net
proceeds from sale of shares from rights offering (0 and 5,714,415
shares
issued, respectively) (Note
9) |
—
|
86,455,209
‡
|
|
Reinvestment
of distributions (0 and 5,469 shares issued, respectively) |
—
|
88,817
|
|
Increase
(Decrease) in Net Assets From Fund Share
Transactions
|
(17,530
) |
87,254,579
|
|
Increase
in Net Assets |
17,412,914
|
58,644,413
|
|
Net
Assets: |
|
|
|
Beginning
of period |
378,139,033
|
319,494,620
|
|
End
of period |
$395,551,947
|
$378,139,033
|
|
†
|
Net
of shelf registration offering costs of $17,530 for the six months ended May 31, 2026, net of sales charges of
$5,797
and net of shelf registration offering costs of $2,448 for the year ended November 30, 2025. |
|
‡
|
Net
of rights offering costs of $403,899. |
See
Notes to Financial Statements.
LMP
Capital and Income Fund Inc. 2026 Semi-Annual Report
15
Statement
of cash flows (unaudited)
For the Six Months Ended May 31,
2026
|
Increase
(Decrease) in Cash: |
|
|
Cash
Flows from Operating Activities: |
|
|
Net
increase in net assets resulting from operations |
$33,923,006
|
|
Adjustments
to reconcile net increase in net assets resulting from operations to net cash
provided
(used) by operating activities: |
|
|
Purchases
of portfolio securities |
(200,286,174
) |
|
Sales
of portfolio securities |
194,786,930
|
|
Net
purchases, sales and maturities of short-term investments |
(3,048,332
) |
|
Net
amortization of premium (accretion of discount) |
(28,264
) |
|
Return
of capital |
1,587,810
|
|
Securities
litigation proceeds |
272
|
|
Increase
in receivable for securities sold |
(10,300
) |
|
Increase
in dividends and interest receivable |
(190,047
) |
|
Increase
in prepaid expenses |
(5,361
) |
|
Increase
in deferred offering costs |
(12,493
) |
|
Increase
in payable for securities purchased |
1,337,019
|
|
Increase
in investment management fee payable |
44,291
|
|
Decrease
in Directors’ fees payable |
(3,023
) |
|
Increase
in interest and commitment fees payable |
7,367
|
|
Decrease
in accrued expenses |
(28,112
) |
|
Net
realized gain on investments |
(5,122,358
) |
|
Change
in net unrealized appreciation (depreciation) of investments |
(27,417,612
) |
|
Net
Cash Used in Operating Activities* |
(4,465,381
) |
|
Cash
Flows from Financing Activities: |
|
|
Distributions
paid on common stock (net of distributions payable) |
(19,241,322
) |
|
Proceeds
from loan facility borrowings |
25,000,000
|
|
Decrease
in due to custodian |
(297,267
) |
|
Net
proceeds from sale of shares from shelf registration |
(17,530
) |
|
Net
Cash Provided by Financing Activities |
5,443,881
|
|
Net
Increase in Cash and Restricted Cash |
978,500
|
|
Cash
and restricted cash at beginning of period |
—
|
|
Cash
and restricted cash at end of period |
$978,500
|
|
*
|
Included
in operating expenses is $2,125,231 paid for interest and commitment fees on borrowings. |
The following table provides a reconciliation
of cash and restricted cash reported within the Statement of Assets
and
Liabilities that sums to the total of such amounts shown on the Statement of Cash Flows.
|
|
May
31, 2026 |
|
Cash
|
$978,500
|
|
Restricted
cash |
—
|
|
Total
cash and restricted cash shown in the Statement of Cash Flows |
$978,500
|
See
Notes to Financial Statements.
16
LMP
Capital and Income Fund Inc. 2026 Semi-Annual Report
Financial
highlights
|
For
a share of capital stock outstanding throughout each year ended November 30,
unless
otherwise noted: | |||||
|
|
20261,2
|
20251
|
20241
|
20231
|
20221
|
|
Net
asset value, beginning of period |
$16.51
|
$18.64
|
$14.90
|
$14.74
|
$15.93
|
|
Income
(loss) from operations: | |||||
|
Net
investment income |
0.06
|
0.20
|
0.19
|
0.03
|
0.37
|
|
Net
realized and unrealized gain (loss) |
1.42
|
(0.41
) |
4.91
|
1.45
|
(0.55
) |
|
Total
income (loss) from operations |
1.48
|
(0.21)
|
5.10
|
1.48
|
(0.18)
|
|
Less
distributions from: |
|
|
|
|
|
|
Net
investment income |
(0.72
)4
|
(0.72
) |
(0.45
) |
(0.33
)5
|
(0.33
) |
|
Net
realized gains |
—
|
(0.70
) |
(0.91
) |
(0.38
)5
|
—
|
|
Return
of capital |
—
|
—
|
—
|
(0.64
) |
(0.71
) |
|
Total
distributions
|
(0.72
) |
(1.42
) |
(1.36
) |
(1.35
) |
(1.04
) |
|
Anti-dilutive
impact of repurchase plan |
—
|
—
|
—
|
0.03
6
|
0.03
6
|
|
Dilutive impact of rights offering
|
—
|
(0.50
)7
|
—
|
—
|
—
|
|
Net
asset value, end of period |
$17.27
|
$16.51
|
$18.64
|
$14.90
|
$14.74
|
|
Market
price, end of period |
$15.49
|
$14.80
|
$17.83
|
$13.16
|
$13.04
|
|
Total
return, based on NAV9,10
|
9.18
% |
(3.59
)% |
35.75
% |
11.18
% |
(0.71
)% |
|
Total
return, based on Market Price12
|
9.65
% |
(9.23
)% |
47.81
% |
12.51
% |
(1.32
)% |
|
Net
assets, end of period (millions)
|
$396
|
$378
|
$319
|
$255
|
$257
|
|
Ratios
to average net assets: | |||||
|
Gross
expenses13
|
2.44
%14
|
2.39
% |
2.70
% |
2.62
% |
1.67
% |
|
Net
expenses13
|
2.44
14
|
2.39
|
2.70
|
2.62
|
1.67
|
|
Net
investment income |
0.76
14
|
1.21
|
1.18
|
0.22
|
2.45
|
|
Portfolio
turnover rate |
41
% |
51
% |
44
% |
41
% |
16
% |
|
Supplemental
data: |
|
|
|
|
|
|
Loan
Outstanding, End of Period (000s) |
$105,000
|
$80,000
|
$67,000
|
$61,000
|
$61,000
|
|
Asset
Coverage Ratio for Loan Outstanding16
|
477
% |
573
% |
577
% |
519
% |
521
% |
|
Asset
Coverage, per $1,000 Principal Amount of
Loan
Outstanding16
|
$4,767
|
$5,727
|
$5,769
|
$5,187
|
$5,205
|
|
Weighted
Average Loan (000s) |
$94,176
|
$71,701
|
$66,672
|
$61,000
|
$61,000
|
|
Weighted
Average Interest Rate on Loan
|
4.46
% |
5.10
% |
6.01
% |
5.60
% |
2.03
% |
See
Notes to Financial Statements.
LMP
Capital and Income Fund Inc. 2026 Semi-Annual Report
17
Financial
highlights (cont’d)
|
For
a share of capital stock outstanding throughout each year ended November 30,
unless
otherwise noted: | ||||||
|
|
20211
|
20201,3
|
20191,3
|
20181,3
|
20171,3
|
20161,3
|
|
Net
asset value, beginning of period |
$13.12
|
$15.60
|
$14.24
|
$15.34
|
$15.33
|
$15.31
|
|
Income
(loss) from operations: | ||||||
|
Net
investment income |
0.50
|
0.56
|
0.44
|
0.53
|
0.47
|
0.50
|
|
Net
realized and unrealized gain (loss) |
3.33
|
(1.80
) |
2.16
|
(0.39
) |
0.78
|
0.76
|
|
Total
income (loss) from
operations
|
3.83
|
(1.24)
|
2.60
|
0.14
|
1.25
|
1.26
|
|
Less
distributions from: |
|
|
|
|
|
|
|
Net
investment income |
(0.52
) |
(0.46
) |
(0.45
) |
(0.54
) |
(0.57
) |
(0.46
) |
|
Return
of capital |
(0.52
) |
(0.78
) |
(0.79
) |
(0.70
) |
(0.67
) |
(0.78
) |
|
Total
distributions
|
(1.04
) |
(1.24
) |
(1.24
) |
(1.24
) |
(1.24
) |
(1.24
) |
|
Anti-dilutive
impact of repurchase plan |
0.02
6
|
—
|
—
|
—
|
—
|
—
|
|
Capital
contributions |
—
|
0.00
8
|
—
|
—
|
—
|
—
|
|
Net
asset value, end of period |
$15.93
|
$13.12
|
$15.60
|
$14.24
|
$15.34
|
$15.33
|
|
Market
price, end of period |
$14.27
|
$11.33
|
$14.62
|
$12.42
|
$13.76
|
$13.11
|
|
Total
return, based on NAV9,10
|
30.38
% |
(5.82
)%11
|
19.45
% |
0.99
% |
8.40
% |
8.84
% |
|
Total
return, based on Market Price12
|
36.28
% |
(12.83
)% |
29.56
% |
(1.04
)% |
14.47
% |
12.88
% |
|
Net
assets, end of period (millions)
|
$282
|
$236
|
$281
|
$256
|
$276
|
$276
|
|
Ratios
to average net assets: | ||||||
|
Gross
expenses |
1.33
% |
1.65
% |
2.18
% |
2.18
% |
1.80
% |
1.54
% |
|
Net
expenses |
1.33
|
1.65
15
|
2.11
15
|
2.18
|
1.80
|
1.54
|
|
Net
investment income |
3.35
|
4.40
|
2.98
|
3.62
|
3.00
|
3.38
|
|
Portfolio
turnover rate |
33
% |
52
% |
36
% |
26
% |
37
% |
29
% |
|
Supplemental
data: |
|
|
|
|
|
|
|
Loan
Outstanding, End of Period (000s) |
$61,000
|
$55,000
|
$82,000
|
$90,000
|
$90,000
|
$82,500
|
|
Asset
Coverage Ratio for Loan
Outstanding16
|
562
% |
529
% |
442
% |
384
% |
407
% |
434
% |
|
Asset
Coverage, per $1,000 Principal
Amount
of Loan Outstanding16
|
$5,619
|
$5,289
|
$4,421
|
$3,845
|
$4,065
|
$4,343
|
|
Weighted
Average Loan (000s) |
$57,663
|
$62,973
|
$82,548
|
$90,000
|
$88,849
|
$75,307
|
|
Weighted
Average Interest Rate on
Loan
|
0.79
% |
1.44
% |
2.98
% |
2.63
% |
1.72
% |
1.13
% |
See
Notes to Financial Statements.
18
LMP
Capital and Income Fund Inc. 2026 Semi-Annual Report
|
1
|
Per
share amounts have been calculated using the average shares method. |
|
2
|
For
the six months ended May 31, 2026 (unaudited). |
|
3
|
Audited,
but not covered by the current report of the independent registered public accounting firm. |
|
4
|
The
actual source of the Fund’s current fiscal year distributions may be from net investment income, realized
capital
gains, return of capital or a combination thereof. Shareholders will be informed of the tax characteristics of
the
distributions after the close of the fiscal year. |
|
5
|
Per
share amounts for the fiscal year ended November 30, 2023, has been updated to reflect the final character of
distributions
paid. |
|
6
|
The
repurchase plan was completed at an average repurchase price of $12.22 for 267,305 shares and $3,265,764
for
the year ended November 30, 2023, $14.15 for 281,609 shares and $3,984,968 for the year ended November 30,
2022,
and $14.15 for 296,622 shares and $4,197,215 for the year ended November 30, 2021. |
|
7
|
The
rights offering was completed at a price of $15.20 for 5,714,415 shares and $86,859,108 for the year ended
November
30, 2025. |
|
8
|
Amount
represents less than $0.005 or greater than $(0.005) per share. |
|
9
|
Performance
figures may reflect compensating balance arrangements, fee waivers and/or expense reimbursements.
In
the absence of compensating balance arrangements, fee waivers and/or expense reimbursements, the total
return
would have been lower. Past performance is no guarantee of future results. Total returns for periods of less
than
one year are not annualized. |
|
10
|
The
total return calculation assumes that distributions are reinvested at NAV. Past performance is no guarantee of
future
results. Total returns for periods of less than one year are not annualized. |
|
11
|
Includes
the effect of a capital contribution. Absent the capital contribution, the total return would have been
unchanged.
|
|
12
|
The
total return calculation assumes that distributions are reinvested in accordance with the Fund’s dividend
reinvestment
plan. Past performance is no guarantee of future results. Total returns for periods of less than one
year
are not annualized. |
|
13
|
Includes
expenses related to borrowings of 1.17%, 1.15%, 1.44%, 1.41%, 0.48%, 0.17%, 0.40%, 0.94%, 0.90%,
0.55%
and 0.32% for the six months ended May 31, 2026 and years ended November 30, 2025, 2024, 2023, 2022,
2021,
2020, 2019, 2018, 2017 and 2016, respectively. |
|
14
|
Annualized.
|
|
15
|
Reflects
fee waivers and/or expense reimbursements. |
|
16
|
Represents
value of net assets plus the loan outstanding at the end of the period divided by the loan outstanding
at
the end of the period. |
See
Notes to Financial Statements.
LMP
Capital and Income Fund Inc. 2026 Semi-Annual Report
19
Notes
to financial statements (unaudited)
1. Organization
and significant accounting policies
LMP Capital and Income Fund Inc.
(the “Fund”) was incorporated in Maryland on November
12, 2003, and is registered as a diversified, closed-end management investment company
under the Investment Company Act of 1940, as amended (the “1940 Act”). The Board
of Directors (the “Board”) authorized 100 million shares of $0.001 par value common stock.
The Fund’s investment objective is total return with an emphasis on income.
Under normal market conditions,
the Fund seeks to maximize total return by investing at least
80% of its Managed Assets in a broad range of equity and fixed income securities of both
U.S. and foreign issuers. The Fund will vary its allocation between equity and fixed income
securities depending on ClearBridge Investments, LLC’s (“ClearBridge”) view of economic,
market or political conditions, fiscal and monetary policy and security valuation.
The Fund follows the accounting
and reporting guidance in Financial Accounting Standards Board
(“FASB”)
Accounting Standards Codification Topic 946, Financial Services –
Investment Companies
(“ASC
946”).
The following are significant accounting policies consistently
followed by the Fund and are in conformity with U.S. generally accepted accounting
principles (“GAAP”), including, but not limited to, ASC 946. Estimates and assumptions
are required to be made regarding assets, liabilities and changes in net assets resulting
from operations when financial statements are prepared. Changes in the economic environment,
financial markets and any other parameters used in determining these estimates
could cause actual results to differ. Subsequent events have been evaluated through
the date the financial statements were issued.
(a) Investment
valuation. Equity
securities for which market quotations are available are valued
at the last reported sales price or official closing price on the primary market or exchange
on which they trade. The valuations for fixed income securities (which may include,
but are not limited to, corporate, government, municipal, mortgage-backed, collateralized
mortgage obligations and asset-backed securities) and certain derivative instruments
are typically the prices supplied by independent third party pricing services, which
may use market prices or broker/dealer quotations or a variety of valuation techniques
and methodologies. The independent third party pricing services typically use inputs
that are observable such as issuer details, interest rates, yield curves, prepayment speeds,
credit risks/spreads, default rates and quoted prices for similar securities. Investments
in open-end funds are valued at the closing net asset value per share of each fund
on the day of valuation. When the Fund holds securities or other assets that are denominated
in a foreign currency, the Fund will normally use the currency exchange rates as
of 4:00 p.m. (Eastern Time). If independent third party pricing services are unable to supply
prices for a portfolio investment, or if the prices supplied are deemed by the manager
to be unreliable, the market price may be determined by the manager using quotations
from one or more broker/dealers or at the transaction price if the security has recently
been purchased and no value has yet been obtained from a pricing service or pricing
broker. When reliable prices are not readily available, such as when the value of a security
has been significantly affected by events after the close of the exchange or market on
which the security is principally traded, but before the Fund calculates its net asset
20
LMP
Capital and Income Fund Inc. 2026 Semi-Annual Report
value, the
Fund values these securities as determined in accordance with procedures approved
by the Board.
Pursuant to policies adopted by
the Board, the Fund’s manager has been designated as the valuation
designee and is responsible for the oversight of the daily valuation process. The Fund’s
manager is assisted by the Global Fund Valuation Committee (the “Valuation
Committee”).
The Valuation Committee is responsible for making fair value determinations, evaluating
the effectiveness of the Fund’s pricing policies, and reporting to the Fund’s manager
and the Board. When determining the reliability of third party pricing information for
investments owned by the Fund, the Valuation Committee, among other things, conducts due
diligence reviews of pricing vendors, monitors the daily change in prices and reviews transactions
among market participants.
The Valuation Committee will consider
pricing methodologies it deems relevant and appropriate
when making fair value determinations. Examples of possible methodologies include,
but are not limited to, multiple of earnings; discount from market of a similar freely traded
security; discounted cash-flow analysis; book value or a multiple thereof; risk premium/yield
analysis; yield to maturity; and/or fundamental investment analysis. The Valuation
Committee will also consider factors it deems relevant and appropriate in light of the
facts and circumstances. Examples of possible factors include, but are not limited to, the
type of security; the issuer’s financial statements; the purchase price of the security; the discount
from market value of unrestricted securities of the same class at the time of purchase;
analysts’ research and observations from financial institutions; information regarding
any transactions or offers with respect to the security; the existence of merger proposals
or tender offers affecting the security; the price and extent of public trading in similar
securities of the issuer or comparable companies; and the existence of a shelf registration
for restricted securities.
For each portfolio security that
has been fair valued pursuant to the policies adopted by the Board,
the fair value price is compared against the last available and next available market quotations.
The Valuation Committee reviews the results of such back testing monthly and fair
valuation occurrences are reported to the Board quarterly.
The Fund uses valuation techniques
to measure fair value that are consistent with the market
approach and/or income approach, depending on the type of security and the particular
circumstance. The market approach uses prices and other relevant information generated
by market transactions involving identical or comparable securities. The income approach
uses valuation techniques to discount estimated future cash flows to present value.
LMP
Capital and Income Fund Inc. 2026 Semi-Annual Report
21
Notes
to financial statements (unaudited) (cont’d)
GAAP establishes
a disclosure hierarchy that categorizes the inputs to valuation techniques used
to value assets and liabilities at measurement date. These inputs are summarized in the
three broad levels listed below:
•
Level
1 — unadjusted quoted prices in active markets for identical investments
•
Level
2 — other significant observable inputs (including quoted prices for similar investments,
interest rates, prepayment speeds, credit risk, etc.)
•
Level
3 — significant unobservable inputs (including the Fund’s own assumptions in determining
the fair value of investments)
The inputs or methodologies used
to value securities are not necessarily an indication of the
risk associated with investing in those securities.
The following is a summary of the
inputs used in valuing the Fund’s assets carried at fair value:
|
ASSETS
| ||||
|
Description
|
Quoted
Prices
(Level
1) |
Other
Significant
Observable
Inputs
(Level
2) |
Significant
Unobservable
Inputs
(Level
3) |
Total
|
|
Long-Term
Investments†: |
|
|
|
|
|
Common
Stocks |
$400,835,811
|
—
|
—
|
$400,835,811
|
|
Master
Limited Partnerships |
44,612,770
|
—
|
—
|
44,612,770
|
|
Convertible
Preferred Stocks: |
|
|
|
|
|
Consumer
Discretionary |
—
|
—
|
$10,881,860
|
10,881,860
|
|
Other
Convertible Preferred
Stocks
|
17,634,816
|
—
|
—
|
17,634,816
|
|
Corporate
Bonds & Notes |
—
|
$17,015,405
|
—
|
17,015,405
|
|
U.S.
Government & Agency
Obligations
|
—
|
164,402
|
—
|
164,402
|
|
Total
Long-Term Investments |
463,083,397
|
17,179,807
|
10,881,860
|
491,145,064
|
|
Short-Term
Investments† |
9,138,011
|
—
|
—
|
9,138,011
|
|
Total
Investments |
$472,221,408
|
$17,179,807
|
$10,881,860
|
$500,283,075
|
|
†
|
See
Schedule of Investments for additional detailed categorizations. |
22
LMP
Capital and Income Fund Inc. 2026 Semi-Annual Report
The following
is a reconciliation of investments in which significant unobservable inputs (Level
3) were used in determining fair value:
|
Investments
in
Securities
|
Balance
as of
November
30,
2025
|
Accrued
premiums/
discounts
|
Realized
gain
(loss)
|
Change
in
unrealized
appreciation
(depreciation)1
|
Purchases
|
|
Convertible
Preferred
Stocks:
|
|
|
|
|
|
|
Consumer
Discretionary
|
—
|
—
|
—
|
$881,860
|
$10,000,000
|
|
Total
|
—
|
—
|
—
|
$881,860
|
$10,000,000
|
|
Investments
in
Securities
(cont’d) |
Sales
|
Transfers
into
Level
3 |
Transfers
out
of
Level
3 |
Balance
as
of
May
31, 2026 |
Net
change
in
unrealized
appreciation
(depreciation)
for
investments
in
securities
still
held at
May
31, 20261
|
|
Convertible
Preferred
Stocks:
|
|
|
|
|
|
|
Consumer
Discretionary
|
—
|
—
|
—
|
$10,881,860
|
$881,860
|
|
Total
|
—
|
—
|
—
|
$10,881,860
|
$881,860
|
|
1
|
This
amount is included in the change in net unrealized appreciation (depreciation) in the accompanying Statement
of
Operations. Change in unrealized appreciation (depreciation) includes net unrealized appreciation (depreciation)
resulting
from changes in investment values during the reporting period and the reversal of previously recorded
unrealized
appreciation (depreciation) when gains or losses are realized. |
The following table summarizes the
valuation techniques used and unobservable inputs approved
by the Valuation Committee to determine the fair value of certain material Level 3 investments.
The table does not include Level 3 investments with values derived utilizing
LMP
Capital and Income Fund Inc. 2026 Semi-Annual Report
23
Notes
to financial statements (unaudited) (cont’d)
prices from
prior transactions or third party pricing information without adjustment (e.g., broker
quotes, pricing services, net asset values).
|
|
Fair
Value
at
5/31/26
(000’s)
|
Valuation
Technique(s)
|
Unobservable
Input(s)
|
Range/Weighted
Average
|
Impact
to Valuation
from
an Increase in
Input*
|
|
Convertible
Preferred
Stocks
|
$10,881
|
Binomial
option
pricing
model |
Discount
for
lack
of
marketability
|
12.69%
|
Decrease
|
|
|
|
|
Time
to maturity |
0.85
|
Increase
|
|
|
|
|
|
|
|
|
*
This column represents the directional change in the fair value of the Level 3 investments that would result in an
increase
from the corresponding unobservable input. A decrease to the unobservable input would have the opposite
effect.
Significant increases and decreases in these unobservable inputs in isolation could result in significantly higher
or
lower fair value measurements. | |||||
(b) Master
limited partnerships. The
Fund may invest without limit in the securities of both
energy and non-energy Master Limited Partnerships (“MLPs”), so long as no more than 25%
of the Fund’s total assets are invested in MLPs that are treated for U.S. federal tax purposes
as qualified publicly traded partnerships. This 25% limitation applies generally to MLPs
that focus on commodity and energy-related industries. Entities commonly referred to as
“MLPs” are generally organized under state law as limited partnerships or limited liability
companies. To be treated as a partnership for U.S. federal income tax purposes, an MLP
whose units are traded on a securities exchange must receive at least 90% of its income
from qualifying sources such as interest, dividends, real estate rents, gain from the sale
or disposition of real property, income and gain from mineral or natural resources activities,
income and gain from the transportation or storage of certain fuels, and, in certain
circumstances, income and gain from commodities or futures, forwards and options with
respect to commodities. Mineral or natural resources activities include exploration, development,
production, processing, mining, refining, marketing and transportation (including
pipelines) of oil and gas, minerals, geothermal energy, fertilizer, timber or industrial
source carbon dioxide. An MLP consists of a general partner and limited partners (or
in the case of MLPs organized as limited liability companies, a managing member and members).
The general partner or managing member typically controls the operations and management
of the MLP and has an ownership stake in the partnership. The limited partners
or members, through their ownership of limited partner or member interests, provide
capital to the entity, are intended to have no role in the operation and management of
the entity and receive cash distributions. The MLPs themselves generally do not pay U.S. federal
income taxes. Thus, unlike investors in corporate securities, direct MLP investors are
generally not subject to double taxation (i.e., corporate level tax and tax on corporate dividends).
Currently, most MLPs operate in the energy and/or natural resources sector.
(c) Cash
flow information. The
Fund invests in securities and distributes dividends from net
investment income and net realized gains, which are paid in cash and may be reinvested
at the discretion of shareholders. These activities are reported in the Statements
24
LMP
Capital and Income Fund Inc. 2026 Semi-Annual Report
of Changes
in Net Assets and additional information on cash receipts and cash payments is presented
in the Statement of Cash Flows.
(d) Foreign
currency translation. Investment
securities and other assets and liabilities denominated
in foreign currencies are translated into U.S. dollar amounts based upon prevailing
exchange rates on the date of valuation. Purchases and sales of investment securities
and income and expense items denominated in foreign currencies are translated into
U.S. dollar amounts based upon prevailing exchange rates on the respective dates of such
transactions.
The Fund does not isolate that
portion of the results of operations resulting from fluctuations
in foreign exchange rates on investments from the fluctuations arising from changes
in market prices of securities held. Such fluctuations are included with the net realized
and unrealized gain or loss on investments.
Net realized foreign exchange gains
or losses arise from sales of foreign currencies, including
gains and losses on forward foreign currency contracts, currency gains or losses realized
between the trade and settlement dates on securities transactions, and the difference
between the amounts of dividends, interest, and foreign withholding taxes recorded
on the Fund’s books and the U.S. dollar equivalent of the amounts actually received
or paid. Net unrealized foreign exchange gains and losses arise from changes in the
values of assets and liabilities, other than investments in securities, on the date of valuation,
resulting from changes in exchange rates.
Foreign security and currency transactions
may involve certain considerations and risks not typically
associated with those of U.S. dollar denominated transactions as a result of, among
other factors, the possibility of lower levels of governmental supervision and regulation
of foreign securities markets and the possibility of political or economic instability.
(e) Foreign
investment risks. The
Fund’s investments in foreign securities may involve risks
not present in domestic investments. Since securities may be denominated in foreign currencies,
may require settlement in foreign currencies or may pay interest or dividends in foreign
currencies, changes in the relationship of these foreign currencies to the U.S. dollar can
significantly affect the value of the investments and earnings of the Fund. Foreign investments
may also subject the Fund to foreign government exchange restrictions, expropriation,
taxation or other political, social or economic developments, all of which affect
the market and/or credit risk of the investments.
(f) Security
transactions and investment income. Security
transactions are accounted for on a trade date basis.
Interest income (including interest income from payment-in-kind securities)
is recorded on the accrual basis. Amortization of premiums and accretion of discounts
on debt securities are recorded to interest income over the lives of the respective securities,
except for premiums on certain callable debt securities, which are amortized to the
earliest call date. Dividend income is recorded on the ex-dividend date for dividends received
in cash and/or securities. Foreign dividend income is recorded on the ex-dividend
LMP
Capital and Income Fund Inc. 2026 Semi-Annual Report
25
Notes
to financial statements (unaudited) (cont’d)
date or as
soon as practicable after the Fund determines the existence of a dividend declaration
after exercising reasonable due diligence. The cost of investments sold is determined
by use of the specific identification method. To the extent any issuer defaults or a
credit event occurs that impacts the issuer, the Fund may halt any additional interest income
accruals and consider the realizability of interest accrued up to the date of default or
credit event.
(g) Return
of capital estimates. Distributions
received from the Fund’s investments in MLPs generally
are comprised of income and return of capital and distributions received from
the Fund’s investments in Real Estate Investment Trusts (“REITs”) generally are comprised
of income, realized capital gains and return of capital. The Fund records investment
income, realized capital gains and return of capital based on estimates made at the
time such distributions are received. Such estimates are based on historical information available
from each MLP or REIT and other industry sources. These estimates may subsequently
be revised based on information received from the MLPs and REITs after their tax
reporting periods are concluded.
(h) Partnership
accounting policy. The
Fund records its pro rata share of the income (loss) and
capital gains (losses), to the extent of distributions it has received, allocated from the
underlying partnerships and accordingly adjusts the cost basis of the underlying partnerships
for return of capital. These amounts are included in the Fund’s Statement of Operations.
(i) Distributions
to shareholders. Distributions
from net investment income of the Fund, if any, are declared
and paid on a monthly basis. Distributions of net realized gains, if any, are
declared at least annually. The actual source of the Fund’s fiscal year distributions may be
from net investment income, realized capital gains, return of capital or a combination thereof.
Shareholders will be informed of the tax characteristics of the distributions after the
close of the fiscal year. The Fund intends to distribute all of its net investment income earned
each month and any cash received during the month from its investments in MLPs and
REITs. The Fund intends to distribute the cash received from MLPs and REITs even if all or
a portion of that cash may represent a return of capital to the Fund. The Fund may distribute
additional amounts if required under the income tax regulations. Pursuant to its Managed
Distribution Policy, the Fund intends to make regular monthly distributions to shareholders
at a fixed rate per common share, which rate may be adjusted from time to time
by the Board. Under the Fund’s Managed Distribution Policy, if, for any monthly distribution,
the value of the Fund’s net investment income and net realized capital gain is less
than the amount of the distribution, the difference will be distributed from the Fund’s net
assets (and may constitute a “return of capital”). The Board may modify, terminate or suspend
the Managed Distribution Policy at any time, including when certain events would make
part of the return of capital taxable to shareholders. Any such modification, termination
or suspension could have an adverse effect on the market price of the Fund’s shares.
Distributions to shareholders of the Fund are recorded on the ex-dividend date and are
determined in accordance with income tax regulations, which may differ from GAAP.
26
LMP
Capital and Income Fund Inc. 2026 Semi-Annual Report
(j) Federal
and other taxes. It
is the Fund’s policy to comply with the federal income and excise
tax requirements of the Internal Revenue Code of 1986, as amended (the “Code”), applicable
to regulated investment companies. Accordingly, the Fund intends to distribute its
taxable income and net realized gains, if any, to shareholders in accordance with timing requirements
imposed by the Code. Therefore, no federal or state income tax provision is required
in the Fund’s financial statements.
The Fund may invest without limit
in the securities of MLPs, so long as no more than 25% of
its total assets are invested in MLPs that are treated as qualified publicly traded partnerships
for U.S. federal income tax purposes. As a limited partner in the MLPs, the Fund
reports its allocable share of the MLP’s taxable income in computing its own taxable income.
The distributions paid by the MLPs generally do not constitute income for tax purposes.
Each MLP may allocate losses to the Fund which are generally not deductible in computing
the Fund’s taxable income until such time as that particular MLP either generates income
to offset those losses or the Fund disposes of units in that MLP. This may result in the
Fund’s taxable income being substantially different than its book income in any given year.
As a result, the Fund may have insufficient taxable income to support its distributions paid
resulting in a return of capital to shareholders. A return of capital distribution is generally
not treated as taxable income to shareholders and instead reduces a shareholder’s
basis in their shares of the Fund.
The Fund, and entities in which the Fund invests, may be subject to audit by the Internal Revenue Service or other applicable tax authorities. The Fund’s taxable income or tax liability for prior taxable years could be adjusted if there is an audit of the Fund, or of any entity that is treated as a partnership for tax purposes in which the Fund holds an equity interest. The Fund may be required to pay a fund-level tax as a result of such an adjustment or may pay a “deficiency dividend” to its current shareholders in order to avoid a fund-level tax associated with the adjustment. The Fund could also be required to pay interest and penalties in connection with such an adjustment.
The Fund, and entities in which the Fund invests, may be subject to audit by the Internal Revenue Service or other applicable tax authorities. The Fund’s taxable income or tax liability for prior taxable years could be adjusted if there is an audit of the Fund, or of any entity that is treated as a partnership for tax purposes in which the Fund holds an equity interest. The Fund may be required to pay a fund-level tax as a result of such an adjustment or may pay a “deficiency dividend” to its current shareholders in order to avoid a fund-level tax associated with the adjustment. The Fund could also be required to pay interest and penalties in connection with such an adjustment.
Management has analyzed the Fund’s
tax positions taken on income tax returns for all open tax
years and has concluded that as of November 30, 2025, no provision for income tax is required
in the Fund’s financial statements. The Fund’s federal and state income and federal excise
tax returns for the prior three fiscal years are subject to examination by the Internal Revenue
Service and state departments of revenue.
Under the applicable foreign tax
laws, a withholding tax may be imposed on interest, dividends
and capital gains at various rates. In some cases, the Fund may be entitled to reclaim
all or a portion of such taxes, and such reclaim amounts, if any, are reflected as a dividend
receivable in the Statement of Assets and Liabilities and dividend income in the Statement
of Operations. In many cases, however, the Fund may not receive such amounts for
an extended period of time, depending on the country of investment.
LMP
Capital and Income Fund Inc. 2026 Semi-Annual Report
27
Notes
to financial statements (unaudited) (cont’d)
(k) Reclassification. GAAP
requires that certain components of net assets be reclassified to
reflect permanent differences between financial and tax reporting. These reclassifications
have no effect on net assets or net asset value per share.
2. Investment
management agreement and other transactions with affiliates
Franklin Templeton Fund Adviser,
LLC (“FTFA”) is the Fund’s investment manager. ClearBridge,
Western Asset Management Company, LLC (“Western Asset”) and Western Asset
Management Company Limited (“Western Asset London”) are the Fund’s subadvisers. FTFA,
ClearBridge, Western Asset and Western Asset London are indirect, wholly-owned subsidiaries
of Franklin Resources, Inc. (“Franklin Resources”).
FTFA provides administrative and
certain oversight services to the Fund. The Fund pays an investment
management fee, calculated daily and paid monthly, at an annual rate of 0.85% of
the Fund’s average daily net assets plus the proceeds of any outstanding borrowings used
for leverage and any proceeds from the issuance of preferred stock (“Managed
Assets”).
FTFA delegates to the subadvisers
the day-to-day portfolio management of the Fund. ClearBridge
provides investment advisory services to the Fund by both determining the allocation
of the Fund’s assets between equity and fixed income investments and performing
the day-to-day management of the Fund’s investments in equity securities. Western
Asset provides advisory services to the Fund by performing the day-to-day management
of the Fund’s fixed income investments. For their services, FTFA pays the subadvisers
monthly 70% of the net management fee it receives from the Fund. This fee will
be divided on a pro rata basis, based on assets allocated to each subadviser.
Western Asset London provides certain
advisory services to the Fund relating to currency transactions
and investments in non-U.S. dollar denominated securities. Western Asset London
does not receive any compensation from the Fund. In turn, Western Asset pays Western
Asset London monthly a subadvisory fee of 0.30% on the assets managed by Western
Asset London.
During periods in which the Fund
utilizes financial leverage, the fees paid to FTFA will be higher
than if the Fund did not utilize leverage because the fees are calculated as a percentage
of the Fund’s assets, including those investments purchased with leverage.
All officers and one Director of
the Fund are employees of Franklin Resources or its affiliates
and do not receive compensation from the Fund.
28
LMP
Capital and Income Fund Inc. 2026 Semi-Annual Report
3. Investments
During the six months ended
May 31, 2026, the aggregate cost of purchases and proceeds from
sales of investments (excluding short-term investments) and U.S. Government & Agency
Obligations were as follows:
|
|
Investments
|
U.S.
Government &
Agency
Obligations |
|
Purchases
|
$200,286,174
|
—
|
|
Sales
|
194,609,426
|
$177,504
|
At May 31, 2026, the aggregate cost
of investments and the aggregate gross unrealized appreciation
and depreciation of investments for federal income tax purposes were substantially
as follows:
|
|
Cost
|
Gross
Unrealized
Appreciation
|
Gross
Unrealized
Depreciation
|
Net
Unrealized
Appreciation
|
|
Securities
|
$366,938,889
|
$139,052,009
|
$(5,707,823)
|
$133,344,186
|
4. Derivative
instruments and hedging activities
During the six months
ended May 31, 2026, the Fund did not invest in derivative instruments.
5. Loan
The Fund has a Margin Loan and Security
Agreement (the “Credit Agreement”) with Bank of America,
N.A. (“BofA”)
that allows the Fund to borrow up to an aggregate amount of $130,000,000
($80,000,000 prior to January 22, 2026) and renews daily for a 179-day term unless
notice to the contrary is given to the Fund. The Fund pays interest on borrowings calculated
based on SOFR plus applicable margin. The Fund pays a commitment fee on the unutilized
portion of the loan commitment amount at an annual rate of 0.10% except that the
commitment fee is 0.07% when the aggregate outstanding balance of the loan is equal to
or greater than 50% of the maximum commitment amount. To the extent of the borrowing outstanding,
the Fund is required to maintain collateral in a special custody account at the Fund’s
custodian on behalf of BofA. The Fund’s Credit Agreement contains customary covenants
that, among other things, may limit the Fund’s ability to pay distributions in certain
circumstances, incur additional debt, change its fundamental investment policies and
engage in certain transactions, including mergers and consolidations, and require asset coverage
ratios in addition to those required by the 1940 Act. In addition, the Credit Agreement
may be subject to early termination under certain conditions and may contain other
provisions that could limit the Fund’s ability to utilize borrowing under the agreement. Interest
expense related to the Credit Agreement for the six months ended May 31, 2026 was
$2,124,976. For the six months ended May 31, 2026, the Fund incurred commitment fees
of $7,622. For the six months ended May 31, 2026, based on the number of days during the
reporting period that the Fund had a loan balance outstanding, the average daily loan
LMP
Capital and Income Fund Inc. 2026 Semi-Annual Report
29
Notes
to financial statements (unaudited) (cont’d)
balance was
$94,175,824 and the weighted average interest rate was 4.46%. At May 31, 2026,
the Fund had $105,000,000 of borrowings outstanding.
6. Distributions
subsequent to May
31, 2026
The following distributions have
been declared by the Board and are payable subsequent to the
period end of this report:
|
Record
Date |
Payable
Date |
Amount
|
|
6/23/2026
|
6/30/2026
|
$0.1200
|
|
7/24/2026
|
7/31/2026
|
$0.1200
|
|
8/24/2026
|
8/31/2026
|
$0.1200
|
7. Stock
repurchase program
On November 16, 2015, the Fund announced
that the Board had authorized the Fund to repurchase in
the open market up to approximately 10% of the Fund’s outstanding common stock
when the Fund’s shares are trading at a discount to net asset value. The Board has directed
management of the Fund to repurchase shares of common stock at such times and in
such amounts as management reasonably believes may enhance stockholder value. The Fund
is under no obligation to purchase shares at any specific discount levels or in any specific
amounts. During the six months ended May 31, 2026, and the year ended November
30, 2025, the Fund did not repurchase any shares.
Since the commencement of the stock
repurchase program through May 31, 2026, the Fund repurchased
845,536 shares or 4.70% of its common shares outstanding for a total amount of
$11,447,947.
8. Capital
shares
The Fund filed a registration statement
with the Securities and Exchange Commission (“SEC”),
effective March 14, 2025, authorizing the Fund to offer and sell shares of common stock
having an aggregate offering price of up to $150,000,000 (“Shelf Registration”). On March
31, 2025, the Fund entered into a distribution agreement (“Distribution Agreement”) with
Franklin Distributors, LLC (“Distributor”), an affiliate of FTFA, to provide for distribution of
the Fund’s shares of common stock. The Distributor entered into a sub-placement agreement,
dated March 31, 2025 (“Sub-Placement Agent Agreement”), with UBS Securities
LLC with respect to the Fund relating to common stock offered by a prospectus supplement
filed with the SEC by the Fund on March 31, 2025. Under this equity shelf offering
program, the Fund, subject to market conditions, may raise additional equity capital from
time to time in varying amounts and offering methods at a net price at or above the Fund’s
then-current net asset value per common share. Costs incurred by the Fund in connection
with the offering are recorded as a prepaid expense. These costs are amortized on
a pro-rata basis as shares are sold and are presented as a reduction to the net proceeds from
the sale of shares on the Statement of Changes in Net Assets, if applicable. Any deferred
charges remaining at the end of the life of the shelf offering period will be expensed.
For the six months ended May 31, 2026, the Fund incurred net of offering costs of $17,530.
For the year ended November 30, 2025, the Fund sold 43,207 shares of common
30
LMP
Capital and Income Fund Inc. 2026 Semi-Annual Report
stock and
the proceeds from such sales were $710,553, net of offering costs and sales charges
of $2,448 and $5,797, respectively.
9. Rights
offering
On June 2, 2025, the Fund announced
that the Board had approved a transferable rights offering
(“Rights”) to common shareholders of record (“Record Date”) as of June 12, 2025, to
subscribe for additional shares of common stock for up to an aggregate offering price of $87,000,000.
The Rights offering expired on July 11, 2025. Each Record Date stockholder received
one right for each outstanding whole common share held. The Rights holders were entitled
to purchase one additional share of common stock for every three Rights held (“Primary
Subscription”) at the final subscription price (“Subscription Price”) per share. Stockholders
who held fewer than three common shares on Record Date were entitled to subscribe
for one common share, and fractional shares were not issued. The Subscription Price
was determined based upon a formula equal to 92.5% of the average of the last reported
sales price per share of the Fund’s common stock on the New York Stock Exchange (“NYSE”)
on the expiration date and each of the four preceding trading days (“Formula Price”).
If, however, the Formula Price was less than 90% of the net asset value per share of common
stock at the close of trading on the NYSE on the expiration date, then the Subscription
Price was 90% of the Fund’s net asset value per share of common stock at the close
of trading on the NYSE on that day. Record Date stockholders who fully exercised their
Rights in the Primary Subscription were eligible for an over-subscription privilege entitling
those stockholders to subscribe for any additional shares of common stock not purchased
pursuant to the Primary Subscription, subject to certain limitations, allotment and
the right of the Board to have eliminated the over-subscription privilege. Holders of Rights
acquired in the secondary market were not able to participate in the oversubscription privilege.
The Rights offering resulted in the issuance of 5,714,415 shares of common stock. The
gross proceeds from the Rights offering were $86,859,108. The Fund received the gross proceeds
of the Rights offering less fees and expenses totaling $403,899. The shares of common
stock subscribed were issued on July 17, 2025.
10. Operating
segments
The Fund operates as a single operating
segment, which is an investment portfolio. A management
group assigned to the Fund within the Fund’s investment manager serves as the
Chief Operating Decision Maker (“CODM”) and is responsible for evaluating the Fund’s operating
results and allocating resources in accordance with the Fund’s investment strategy.
Internal reporting provided to the CODM aligns with the accounting policies and measurement
principles used in the financial statements.
For information regarding segment
assets, segment profit or loss, and significant expenses, refer
to the Statement of Assets and Liabilities and the Statement of Operations, along with the
related Notes to Financial Statements. The Fund’s Schedule of Investments provides details
of the Fund’s investments that generate returns such as interest, dividends, and realized
and unrealized gains or losses. Performance metrics, including portfolio turnover and
expense ratios, are disclosed in the Financial Highlights.
LMP
Capital and Income Fund Inc. 2026 Semi-Annual Report
31
Board
approval of management and
subadvisory agreements (unaudited)
Background
The Investment Company Act of 1940,
as amended (the “1940 Act”), requires that the Board of
Directors (the “Board”) of LMP Capital and Income Fund Inc. (the “Fund”), including a majority
of its members who are not considered to be “interested persons” under the 1940 Act
(the “Independent Directors”) voting separately, approve on an annual basis the continuation
of the investment management agreement (the “Management Agreement”) between
the Fund and the Fund’s manager, Franklin Templeton Fund Adviser, LLC (the “Manager”),
and the sub-advisory agreements (individually, a “Sub-Advisory Agreement,” and
collectively, the “Sub-Advisory Agreements”) with the Manager’s affiliates, ClearBridge Investments,
LLC (“ClearBridge”), Western Asset Management Company, LLC (“Western Asset”)
and Western Asset Management Company Limited (“Western Asset London,” and together
with ClearBridge and Western Asset, collectively, the “Sub-Advisers”), with respect
to the Fund.
At an in-person meeting (the “Contract
Renewal Meeting”) held on May 12-13, 2026, the Board,
including the Independent Directors, considered and approved the continuation of each
of the Management Agreement and the Sub-Advisory Agreements for an additional one-year
period. To assist in its consideration of the renewal of each of the Management Agreement
and the Sub-Advisory Agreements, the Board received and considered extensive information
(together with the information provided at the Contract Renewal Meeting, the “Contract
Renewal Information”) about the Manager and the Sub-Advisers, as well as the management
and sub-advisory arrangements for the Fund and the other closed-end funds in the
same complex under the Board’s purview (the “Franklin Templeton Closed-end Funds”), certain
portions of which are discussed below.
A presentation made by the Manager
and the Sub-Advisers to the Board at the Contract Renewal
Meeting in connection with the Board’s evaluation of each of the Management Agreement
and the Sub-Advisory Agreements encompassed the Fund and other Franklin Templeton
Closed-end Funds. In addition to the Contract Renewal Information, the Board received
performance and other information throughout the year related to the respective services
rendered by the Manager and the Sub-Advisers to the Fund. The Board’s evaluation took
into account the information received throughout the year and also reflected the knowledge
and experience gained as members of the Boards of the Fund and other Franklin Templeton
Closed-end Funds with respect to the services provided to the Fund by the Manager
and the Sub-Advisers. The information received and considered by the Board (including
its various committees) in conjunction with both the Contract Renewal Meeting and
throughout the year was both written and oral. The contractual arrangements discussed below
are the product of multiple years of review and negotiation and information received and
considered by the Board during each of those years.
32
LMP
Capital and Income Fund Inc.
At an in-person
meeting held on April 24, 2026, the Independent Directors, in preparation for
the Contract Renewal Meeting, met in a private session with their independent legal counsel
to review the Contract Renewal Information regarding the Franklin Templeton Closed-end
Funds, including the Fund, received to date. No representatives of the Manager or
the Sub-Advisers participated in this meeting. Following the April 24, 2026 meeting, the Independent
Directors submitted certain questions and requests for additional information to
Fund management. The Independent Directors also met in private sessions with their independent
legal counsel to consider the Contract Renewal Information and Fund management’s
responses to the Independent Directors’ questions and requests for additional
information in advance of and during the Contract Renewal Meeting. The discussion
below reflects all of these reviews.
The Manager provides the Fund with
investment advisory and administrative services pursuant
to the Management Agreement and the Sub-Advisers together provide the Fund with
investment sub-advisory services pursuant to the Sub-Advisory Agreements. The discussion
below covers both the advisory and administrative functions being rendered by the
Manager, each such function being encompassed by the Management Agreement, and the
investment sub-advisory functions being rendered by the Sub-Advisers pursuant to the Sub-Advisory
Agreements.
Board Approval of Management Agreement and Sub-Advisory
Agreements
The Independent Directors were advised
by separate independent legal counsel throughout the process.
Prior to voting, the Independent Directors received a memorandum discussing the
legal standards for their consideration of the proposed continuation of the Management Agreement
and the Sub-Advisory Agreements. The Independent Directors considered the Management
Agreement and each Sub-Advisory Agreement separately during the course of their
review. In doing so, they noted the respective roles of the Manager and the Sub-Advisers
in providing services to the Fund.
In approving the continuation of
the Management Agreement and Sub-Advisory Agreements,
the Board, including the Independent Directors, considered a variety of factors, including
those factors discussed below. No single factor reviewed by the Board was identified
by the Board as the principal factor in determining whether to approve the continuation
of the Management Agreement and the Sub-Advisory Agreements. Each Director
may have attributed different weight to the various factors in evaluating the Management
Agreement and the Sub-Advisory Agreements.
After considering all relevant factors
and information, the Board, exercising its reasonable business
judgment, determined that the continuation of the Management Agreement and Sub-Advisory
Agreements was in the best interests of the Fund’s stockholders and approved the
continuation of each such agreement for an additional one-year period.
LMP
Capital and Income Fund Inc.
33
Board
approval of management and
subadvisory agreements (unaudited) (cont’d)
Nature, Extent and Quality
of the Services under the Management Agreement and Sub-Advisory Agreements
The Board received and considered
Contract Renewal Information regarding the nature, extent,
and quality of services provided to the Fund by the Manager and the Sub-Advisers under
the Management Agreement and the Sub-Advisory Agreements, respectively, during the
past year. The Board noted information received at regular meetings throughout the year related
to the services provided by the Manager in its management of the Fund’s affairs and the
Manager’s role in coordinating the activities of the Sub-Advisers and the Fund’s other service
providers. The Board observed that the scope of services provided by the Manager and
the Sub-Advisers, and of the undertakings required of the Manager and Sub-Advisers in connection
with those services, including maintaining and monitoring their respective compliance
programs as well as the Fund’s compliance programs had expanded over time as
a result of regulatory, market and other developments. The Board also noted that on a regular
basis it received and reviewed information from the Manager and the Sub-Advisers regarding
the Fund’s compliance policies and procedures established pursuant to Rule 38a-1 under
the 1940 Act. The Board also considered the risks borne by the Manager, the Sub-Advisers
and their respective affiliates on behalf of the Fund, including entrepreneurial, operational,
reputational, litigation and regulatory risks, as well as the Manager’s and the Sub-Advisers’
risk management processes.
The Board reviewed the qualifications,
backgrounds, and responsibilities of the Manager’s senior
personnel and the Sub-Advisers’ portfolio management teams primarily responsible for
the day-to-day portfolio management of the Fund. The Board also considered, based on its
knowledge of the Manager and its affiliates, the financial resources of Franklin Resources,
Inc., the parent organization of the Manager and the Sub-Advisers. The Board recognized
the importance of having a fund manager with significant resources.
The Board considered the division
of responsibilities between the Manager and the Sub-Advisers
under the Management Agreement and the Sub-Advisory Agreements, respectively,
including the Manager’s coordination and oversight of the services provided to the
Fund by the Sub-Advisers and other fund service providers and Western Asset’s coordination
and oversight of the services provided to the Fund by Western Asset London. The
Management Agreement permits the Manager to delegate certain of its responsibilities,
including its investment advisory duties thereunder, provided that the Manager,
in each case, will supervise the activities of the delegee.
In reaching its determinations regarding
continuation of the Management Agreement and the Sub-Advisory
Agreements, the Board took into account that Fund stockholders, in pursuing
their investment goals and objectives, may have purchased their shares of the
34
LMP
Capital and Income Fund Inc.
Fund based upon
the reputation and the investment style, philosophy and strategy of the Manager
and the Sub-Advisers, as well as the resources available to the Manager and the Sub-Advisers.
The Board concluded that, overall,
the nature, extent, and quality of the management and other
services provided (and expected to be provided) to the Fund, under the Management Agreement
and the Sub-Advisory Agreements were satisfactory.
Fund Performance
The Board received and considered
information regarding Fund performance, including information
and analyses (the “Broadridge Performance Information”) for the Fund, as well as
for a group of comparable funds (the “Performance Universe”) selected by Broadridge Financial
Solutions, Inc. (“Broadridge”), an independent third-party provider of investment company
data. The Board was provided with a description of the methodology Broadridge used
to determine the similarity of the Fund with the funds included in the Performance Universe.
It was noted that while the Board found the Broadridge Performance Information generally
useful, they recognized its limitations, including that the data may vary depending on
the end date selected, and that the results of the performance comparisons may vary depending
on the selection of the peer group and its composition over time. The Board also noted
that Board members had received and discussed with the Manager and the Sub-Advisers
information throughout the year at periodic intervals comparing the Fund’s performance
against its benchmark and against the Fund’s peers. In addition, the Board considered
the Fund’s performance in view of overall financial market conditions.
The Broadridge Performance Information
comparing the Fund’s performance to that of its Performance
Universe, consisting of the Fund and all leveraged closed-end income and preferred
stock funds, regardless of asset size, showed, among other data, that based on net
asset value per share, the Fund’s performance was below the median for the 1-year period
ended December 31, 2025, and was above the median for the 3-, 5- and 10-year periods
ended December 31, 2025. The Board noted the explanations from the Manager and the
Sub-Advisers regarding the Fund’s relative performance versus the Performance Universe
for the various periods.
Based on the reviews and discussions
of Fund performance and considering other relevant factors,
including those noted above, the Board concluded, under the circumstances, that continuation
of the Management Agreement and the Sub-Advisory Agreements for an additional
one-year period would be consistent with the interests of the Fund and its stockholders.
Management and Sub-Advisory Fees and Expense Ratios
The Board reviewed and considered
the contractual management fee (the “Contractual Management
Fee”) and the actual management fee (the “Actual Management Fee”)
LMP
Capital and Income Fund Inc.
35
Board
approval of management and
subadvisory agreements (unaudited) (cont’d)
payable by the
Fund to the Manager under the Management Agreement and the sub-advisory
fees (the “Sub-Advisory Fees”) payable by the Manager to the Sub-Advisers under the
Sub-Advisory Agreements in view of the nature, extent and overall quality of the management,
investment advisory and other services provided by the Manager and the Sub-Advisers,
respectively. The Board noted that the Sub-Advisory Fees payable to ClearBridge
and Western Asset under their Sub-Advisory Agreements with the Manager are paid
by the Manager, not the Fund, and, accordingly, that the retention of ClearBridge and Western
Asset does not increase the fees or expenses otherwise incurred by the Fund’s stockholders.
Similarly, the Board noted that the Sub-Advisory Fee payable to Western Asset
London under its Sub-Advisory Agreement with Western Asset are paid by Western Asset,
not the Fund, and, accordingly, that the retention of Western Asset London does not increase
the fees or expenses otherwise incurred by the Fund’s stockholders.
In addition, the Board received
and considered information and analyses prepared by Broadridge
(the “Broadridge Expense Information”) comparing the Contractual Management Fee
and the Actual Management Fee and the Fund’s actual total expenses with those of funds
in an expense group (the “Expense Group”), as well as a broader group of funds, each selected
and provided by Broadridge. The comparison was based upon the constituent funds’
latest fiscal years. It was noted that while the Board found the Broadridge Expense Information
generally useful, they recognized its limitations, including that the data may vary
depending on the selection of the peer group.
The Broadridge Expense Information
showed that the Fund’s Contractual Management Fee was
below the Expense Group median. The Broadridge Expense Information also showed that
the Fund’s Actual Management Fee was below the Expense Group median based on both
common share assets and total managed assets, which includes common share and leveraged
assets. The Broadridge Expense Information also showed that the Fund’s actual total
expenses were below the Expense Group median based on both common share assets and
leveraged assets. The Board took into account management’s discussion of the Fund’s expenses.
The Board also reviewed Contract
Renewal Information regarding fees charged by the Manager
and/or the Sub-Advisers to other U.S. clients investing primarily in an asset class similar
to that of the Fund, including, where applicable, institutional and separate accounts. The
Manager reviewed with the Board the differences in services provided to these different
types of accounts, noting that the Fund is provided with certain administrative services,
office facilities, and Fund officers, and that the Fund is subject not only to heightened
regulatory requirements relative to institutional clients but also to requirements for
listing on the New York Stock Exchange, and that the Manager coordinates and oversees
the provision of services to the Fund by other fund service providers. The Board
36
LMP
Capital and Income Fund Inc.
considered the
fee comparisons in view of the different services provided in managing these
other types of clients and funds.
The Board considered the overall
management fee, the fees of the Sub-Advisers and the amount
of the management fee retained by the Manager after payment of the Sub-Advisory Fees
in each case in view of the services rendered for those amounts. The Board also received
an analysis of complex-wide management fees provided by the Manager, which, among
other things, set out a framework of fees based on asset classes.
Taking all of the above into consideration,
as well as the factors identified below, the Board determined
that the management fee and the Sub-Advisory Fees were reasonable in view of
the nature, extent and overall quality of the management, investment advisory and other services
provided by the Manager and the Sub-Advisers to the Fund under the Management Agreement
and the Sub-Advisory Agreements, respectively.
Manager Profitability
The Board, as part of the Contract
Renewal Information, received an analysis of the profitability
to the Manager and its affiliates in providing services to the Fund for the Manager’s
fiscal years ended September 30, 2025 and September 30, 2024. The Board also received
profitability information with respect to the Franklin Templeton fund complex as a whole.
In addition, the Board received Contract Renewal Information with respect to the Manager’s
revenue and cost allocation methodologies used in preparing such profitability data.
It was noted that the allocation methodologies had been reviewed by an outside consultant.
In response to the Board’s request, the Manager provided and the Board reviewed
information comparing the profitability of Franklin Resources, Inc. with that of publicly
traded peer fund management companies. The profitability to each of the Sub-Advisers
was not considered to be a material factor in the Board’s considerations since the Sub-Advisory
Fee is paid by the Manager in the case of ClearBridge and Western Asset and by
Western Asset in the case of Western Asset London, not the Fund, although the Board noted
the affiliation of the Manager with the Sub-Advisers. The profitability of the Manager and
its affiliates was considered by the Board to be reasonable in view of the nature, extent and
quality of services provided to the Fund.
Economies of Scale
The Board received and discussed
Contract Renewal Information concerning whether the Manager
realizes economies of scale if the Fund’s assets grow. The Board noted that because
the Fund is a closed-end fund, it has limited ability to increase its assets. The Board
determined that the management fee structure was appropriate under the circumstances.
For similar reasons as stated above with respect to the Sub-Advisers’ profitability
and the costs of the Sub-Advisers’ provision of services, the Board did not consider
the potential for economies of scale in the Sub-Advisers’ management of the Fund to
be a material factor in the Board’s consideration of the Sub-Advisory Agreements.
LMP
Capital and Income Fund Inc.
37
Board
approval of management and
subadvisory agreements (unaudited) (cont’d)
Other Benefits to the Manager
and the Sub-Advisers
The Board considered other benefits
received by the Manager, the Sub-Advisers and their affiliates
as a result of their relationship with the Fund, including the opportunity to offer additional
products and services to the Fund’s stockholders. In view of the costs of providing investment
management and other services to the Fund and the ongoing commitment of the Manager
and the Sub-Advisers to the Fund, the Board considered that the ancillary benefits received
by the Manager and its affiliates, including the Sub-Advisers, were reasonable.
38
LMP
Capital and Income Fund Inc.
Additional
shareholder information (unaudited)
Results of annual meeting
of shareholders
The Annual Meeting of Shareholders
of LMP Capital and Income Fund Inc. was held on April
17, 2026, for the purpose of considering and voting upon the proposals presented at the
Meeting. The following table provides information concerning the matters voted upon at the
Meeting:
Election of Directors
|
Nominees
|
FOR
|
WITHHELD
|
ABSTAIN
|
|
Robert
D. Agdern |
17,529,358
|
2,117,187
|
282,754
|
|
Eileen
A. Kamerick |
17,555,292
|
2,106,996
|
267,011
|
|
Peter
Mason |
19,262,002
|
395,001
|
272,296
|
At the Meeting, Ms. Kamerick and
Messrs. Agdern and Mason were each duly elected by the
shareholders to serve as Class III Directors of the Fund until the 2029 Annual Meeting of Shareholders,
or until their successors have been duly elected and qualified or until their resignation
or are otherwise removed
At May 31, 2026, in addition to
Ms. Kamerick and Messrs. Agdern and Mason, the other Directors
of the Fund were as follows:
Carol
L. Colman, CFA
Anthony Grillo
Nisha Kumar
Hillary A. Sale
Jane Trust, CFA
Anthony Grillo
Nisha Kumar
Hillary A. Sale
Jane Trust, CFA
Ratification of Selection of Independent Registered
Public Accountants
To ratify the selection of PricewaterhouseCoopers
LLP (“PwC”) as independent registered public
accountants of the Fund for the fiscal year ended November 30, 2026.
|
FOR
|
AGAINST
|
ABSTAIN
|
BROKER
NON-VOTES |
|
17,808,141
|
1,891,865
|
229,293
|
N/A
|
LMP
Capital and Income Fund Inc.
39
Dividend
reinvestment plan (unaudited)
Unless you
elect to receive distributions in cash (i.e., opt-out), all dividends, including any capital
gain dividends and return of capital distributions, on your Common Stock will be automatically
reinvested by Computershare Trust Company, N.A., as agent for the stock- holders
(the “Plan Agent”), in additional shares of Common Stock under the Fund’s Dividend Reinvestment
Plan (the “Plan”). You may elect not to participate in the Plan by contacting the
Plan Agent. If you do not participate, you will receive all cash distributions paid by check
mailed directly to you by Computershare Trust Company, N.A., as dividend paying agent.
If you participate in the Plan,
the number of shares of Common Stock you will receive will be
determined as follows:
(1) If the market price of the Common
Stock (plus $0.03 per share commission) on the payment
date (or, if the payment date is not a NYSE trading day, the immediately preceding
trading day) is equal to or exceeds the net asset value per share of the Common
Stock at the close of trading on the NYSE on the payment date, the Fund will issue
new Common Stock at a price equal to the greater of (a) the net asset value per share
at the close of trading on the NYSE on the payment date or (b) 95% of the market
price per share of the Common Stock on the payment date.
(2) If the net asset value per share
of the Common Stock exceeds the market price of the Common
Stock (plus $0.03 per share commission) at the close of trading on the NYSE
on the payment date, the Plan Agent will receive the dividend or distribution in cash
and will buy Common Stock in the open market, on the NYSE or elsewhere, for your
account as soon as practicable commencing on the trading day following the payment
date and terminating no later than the earlier of (a) 30 days after the dividend
or distribution payment date, or (b) the payment date for the next succeeding dividend
or distribution to be made to the stockholders; except when necessary to comply
with applicable provisions of the federal securities laws. If during this period: (i)
the market price (plus $0.03 per share commission) rises so that it equals or exceeds
the net asset value per share of the Common Stock at the close of trading on the
NYSE on the payment date before the Plan Agent has completed the open market purchases
or (ii) if the Plan Agent is unable to invest the full amount eligible to be reinvested
in open market purchases, the Plan Agent will cease purchasing Common Stock
in the open market and the Fund shall issue the remaining Common Stock at a price
per share equal to the greater of (a) the net asset value per share at the close of trading
on the NYSE on the day prior to the issuance of shares for reinvestment or (b)
95% of the then current market price per share.
Common Stock in your account will
be held by the Plan Agent in non-certificated form. Any proxy
you receive will include all shares of Common Stock you have received under the Plan.
You may withdraw from the Plan (i.e., opt-out) by notifying the Plan Agent in writing at P.O.
Box 43006, Providence, RI 02940-3078 or by calling the Plan Agent at 1-888-888-0151. Such
withdrawal will be effective immediately if notice is received by the Plan Agent not less
than ten business days prior to any dividend or distribution record date; otherwise such withdrawal
will be effective as soon as practicable after the Plan Agent’s investment of the most
recently declared dividend or distribution on the Common Stock.
40
LMP
Capital and Income Fund Inc.
Plan participants
who sell their shares will be charged a service charge (currently $5.00 per transaction)
and the Plan Agent is authorized to deduct brokerage charges actually incurred from
the proceeds (currently $0.05 per share commission). There is no service charge for reinvestment
of your dividends or distributions in Common Stock. However, all participants will
pay a pro rata share of brokerage commissions incurred by the Plan Agent when it makes
open market purchases. Because all dividends and distributions will be automatically reinvested
in additional shares of Common Stock, this allows you to add to your investment through
dollar cost averaging, which may lower the average cost of your Common Stock over
time. Dollar cost averaging is a technique for lowering the average cost per share over time
if the Fund’s net asset value declines. While dollar cost averaging has definite advantages,
it cannot assure profit or protect against loss in declining markets.
Automatically reinvesting dividends
and distributions does not mean that you do not have to pay
income taxes due upon receiving dividends and distributions. Investors will be subject to
income tax on amounts reinvested under the Plan.
The Fund reserves the right to amend
or terminate the Plan if, in the judgment of the Board of
Directors, the change is warranted. The Plan may be terminated, amended or supplemented
by the Fund upon notice in writing mailed to stockholders at least 30 days prior
to the record date for the payment of any dividend or distribution by the Fund for which the
termination or amendment is to be effective. Upon any termination, you will be sent cash
for any fractional share of Common Stock in your account. You may elect to notify the Plan
Agent in advance of such termination to have the Plan Agent sell part or all of your Common
Stock on your behalf. Additional information about the Plan and your account may be
obtained from the Plan Agent at P.O. Box 43006, Providence, RI 02940-3078 or by calling the
Plan Agent at 1-888-888-0151.
LMP
Capital and Income Fund Inc.
41
(This
page intentionally left blank.)
(This
page intentionally left blank.)
(This
page intentionally left blank.)
(This
page intentionally left blank.)
(This
page intentionally left blank.)
LMP
Capital and
Income Fund Inc.
Directors
Robert D. Agdern
Carol L. Colman
Anthony Grillo
Eileen A. Kamerick
Chair
Nisha Kumar
Peter Mason
Hillary A. Sale
Jane Trust
Officers
Jane
Trust
President and Chief Executive
Officer
President and Chief Executive
Officer
Christopher
Berarducci
Treasurer and Principal Financial
Officer
Treasurer and Principal Financial
Officer
Fred
Jensen
Chief Compliance Officer
Chief Compliance Officer
Marc
A. De Oliveira
Secretary and Chief Legal Officer
Secretary and Chief Legal Officer
Thomas
C. Mandia
Senior Vice President
Senior Vice President
Jeanne
M. Kelly
Senior Vice President
Senior Vice President
LMP Capital and Income Fund
Inc.
One
Madison Avenue
17th Floor
New York, NY 10010
17th Floor
New York, NY 10010
Investment manager
Franklin Templeton Fund Adviser,
LLC
Subadvisers
ClearBridge Investments, LLC
Western Asset Management Company,
LLC
Western Asset Management Company
Limited
Custodian
The Bank of New York Mellon
Transfer agent
Computershare
Inc.
P.O. Box 43006
Providence, RI 02940-3078
P.O. Box 43006
Providence, RI 02940-3078
Independent
registered
public accounting firm
public accounting firm
PricewaterhouseCoopers
LLP
Baltimore, MD
Baltimore, MD
Legal counsel
Simpson
Thacher & Bartlett LLP
900 G Street NW
Washington, DC 20001
900 G Street NW
Washington, DC 20001
New
York Stock
Exchange Symbol
Exchange Symbol
SCD
LMP Capital and Income Fund
Inc.
LMP
Capital and Income Fund Inc.
One Madison Avenue
17th Floor
New York, NY 10010
One Madison Avenue
17th Floor
New York, NY 10010
Notice is hereby given in accordance
with Section 23(c) of the Investment Company Act of 1940,
as amended, that from time to time the Fund may purchase,
at market prices, shares of its stock.
The Fund files its complete schedule
of portfolio holdings with the Securities and Exchange
Commission (“SEC”) for the first and third quarters of
each fiscal year as an exhibit to its reports on Form N-PORT. The Fund’s Forms
N-PORT are available on the SEC’s website at www.sec.gov. To obtain
information on Form N-PORT, shareholders can call the Fund at 1-888-777-0102.
Information on how the Fund voted
proxies relating to portfolio securities during the prior
12-month period ended June 30th of each year and a description
of the policies and procedures that the Fund uses to determine how
to vote proxies related to portfolio transactions are available (1) without
charge, upon request, by calling 1-888-777-0102, (2) at www.franklintempleton.com
and (3) on the SEC’s website at www.sec.gov.
Quarterly performance, semi-annual
and annual reports, current net asset value and other
information regarding the Fund may be found on Franklin Templeton’s website,
which can be accessed at www.franklintempleton.com. Any reference
to Franklin Templeton’s website in this report is intended to allow investors
public access to information regarding the Fund and does not, and is
not intended to, incorporate Franklin Templeton’s website in this report.
This report is transmitted to the
shareholders of LMP Capital and Income Fund Inc. for their
information. This is not a prospectus, circular or representation
intended for use in the purchase of shares of the Fund or any securities
mentioned in this report.
Computershare
Inc.
P.O. Box 43006
Providence, RI 02940-3078
P.O. Box 43006
Providence, RI 02940-3078
90324-S 7/26
(b) Not applicable
| ITEM 2. | CODE OF ETHICS. |
Not applicable.
| ITEM 3. | AUDIT COMMITTEE FINANCIAL EXPERT. |
Not applicable.
| ITEM 4. | PRINCIPAL ACCOUNTANT FEES AND SERVICES. |
Not applicable.
| ITEM 5. | AUDIT COMMITTEE OF LISTED REGISTRANTS. |
Not applicable.
| ITEM 6. | SCHEDULE OF INVESTMENTS. |
| (a) | Please see schedule of investments contained in the Financial Statements and Financial Highlights included under Item 1 of this Form N-CSR. |
| (b) | Not applicable. |
| ITEM 7. | FINANCIAL STATEMENTS AND FINANCIAL HIGHLIGHTS FOR OPEN-END MANAGEMENT INVESTMENT COMPANIES. |
Not applicable.
| ITEM 8. | CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS FOR OPEN-END MANAGEMENT INVESTMENT COMPANIES. |
Not applicable.
| ITEM 9. | PROXY DISCLOSURES FOR OPEN-END MANAGEMENT INVESTMENT COMPANIES. |
Not applicable.
| ITEM 10. | REMUNERATION PAID TO DIRECTORS, OFFICERS, AND OTHERS OF OPEN-END MANAGEMENT INVESTMENT COMPANIES. |
Not applicable.
| ITEM 11. | STATEMENT REGARDING BASIS FOR APPROVAL OF INVESTMENT ADVISORY CONTRACT. |
The information is disclosed as part of the Financial Statements included in Item 1 of this Form N-CSR, as applicable.
| ITEM 12. | DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES. |
Not applicable.
| ITEM 13. | PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES. |
Not applicable.
| ITEM 14. | PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND AFFILIATED PURCHASERS. |
Not applicable.
| ITEM 15. | SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. |
There have been no changes to the procedures by which shareholders may recommend nominees to the Registrant’s Board of Trustees that would require disclosure herein.
| ITEM 16. | CONTROLS AND PROCEDURES. |
| (a) | The Registrants acknowledge the Staff’s comment. In future filings on Form N-CSR, the certifications required by Rule 30a-2 and Item 19(a)(3) will include the designations “principal executive officer” and “principal financial officer” in the signature blocks, reflecting the capacity in which each signatory executes the certification, in conformity with the language of the Rule and Form N-CSR. The Registrants may also include each signatory’s actual title with respect to the Funds alongside the required designation. |
| (b) | There were no changes in the Registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act) that occurred during the period covered by this report that have materially affected or are likely to materially affect the Registrant’s internal control over financial reporting. |
| ITEM 17. | DISCLOSURE OF SECURITIES LENDING ACTIVITIES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES. |
Not applicable.
| ITEM 18. | RECOVERY OF ERRONEOUSLY AWARDED COMPENSATION. |
| (a) | Not applicable. |
| (b) | Not applicable. |
| ITEM 19. | EXHIBITS. |
(a) (1) Not applicable.
Exhibit 99.CODE ETH
(a) (3) Certifications pursuant to section 302 of the Sarbanes-Oxley Act of 2002 attached hereto.
Exhibit 99.CERT
(b) Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 attached hereto.
Exhibit 99.906CERT
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this Report to be signed on its behalf by the undersigned, there unto duly authorized.
LMP Capital and Income Fund Inc.
| By: | /s/ Jane Trust | |
| Jane Trust | ||
| Chief Executive Officer | ||
| Date: | July 30, 2026 |
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
| By: | /s/ Jane Trust | |
| Jane Trust | ||
| Chief Executive Officer | ||
| Date: | July 30, 2026 | |
| By: | /s/ Christopher Berarducci | |
| Christopher Berarducci | ||
| Principal Financial Officer | ||
| Date: | July 30, 2026 |