NEW YORK, NY — (MARKETWIRE) — 06/07/07 — Prospect Capital Corporation (NASDAQ: PSEC)(“Prospect”) announced today that Prospect has closed a $200 millionthree-year revolving credit facility (the “Facility”) with RabobankNederland as administrative agent and sole lead arranger.
This Facility is being used to refinance Prospect’s $50 million creditfacility and, together with Prospect’s equity capital, to make additionallong-term investments. Interest on borrowings under the Facility is chargedat LIBOR plus 125 basis points.
“Increasing our access to credit by 300% is a significant milestone for ourcompany,” said John Barry, Chairman and Chief Executive Officer ofProspect. “In addition, we have significantly lowered the cost of ourcredit while extending the term from one year to three years, enhancing ouraccess to capital and overall financial flexibility. With the robustinvestment pipeline we currently have, we believe we will be drawing onthis expanded line in the not-too-distant future.”
Separately, Prospect announced today that Charlevoix Energy LLC andaffiliates (collectively, “Charlevoix”) have repaid the unamortized portionof Charlevoix’s term loan with Prospect. With the $352 thousand prepaymentpremium from the loan, Prospect has realized a 21% internal rate of returnon the Charlevoix investment, representing 1.2 times cash on cash. Prospectcontinues to hold a net profit interest in Charlevoix. “We greatly valueour relationship with the owners and managers of Charlevoix,” said GrierEliasek, President and Chief Operating Officer of Prospect, “and we arelooking for more transactions we can work on together.”
ABOUT PROSPECT CAPITAL CORPORATION
Prospect Capital Corporation (www.prospectstreet.com/) is a closed-endinvestment company that lends to and invests in private and microcap publicbusinesses. Prospect Capital’s investment objective is to generate bothcurrent income and capital appreciation through debt and equityinvestments.
Prospect Capital has elected to be treated as a business developmentcompany under the Investment Company Act of 1940 (“1940 Act”). We arerequired to comply with a series of regulatory requirements under the 1940Act as well as applicable NASDAQ, federal and state laws and regulations.We have elected to be treated as a regulated investment company under theInternal Revenue Code of 1986. Failure to comply with any of the laws andregulations that apply to Prospect Capital could have a material adverseeffect on Prospect Capital and its shareholders.
This press release contains forward-looking statements within the meaningof the Private Securities Litigation Reform Act of 1995. Any suchstatements, other than statements of historical fact, are likely to beaffected by other unknowable future events and conditions, includingelements of the future that are or are not under the Company’s control, andthat the Company may or may not have considered; accordingly, suchstatements cannot be guarantees or assurances of any aspect of futureperformance. Actual developments and results are highly likely to varymaterially from these estimates and projections of the future. Suchstatements speak only as of the time when made, and the Company undertakesno obligation to update any such statement now or in the future.
ABOUT RABOBANK
Rabobank Group is a financial services leader providing retail andinstitutional banking and finance solutions in key markets around theworld. From its century-old roots as a finance cooperative founded by Dutchfarmers, Rabobank has grown into one of the 25 largest banks worldwide withapproximately US$650 billion in assets and operations in over 35 countries.Rabobank is the only private bank in the world with the highest possiblecredit rating from both Standard & Poor’s (AAA) and Moody’s InvestorService (Aaa), and is ranked as the world’s third safest bank by GlobalFinance magazine. For more information, visit www.rabobankamerica.com.
Please send investment proposals to:Grier EliasekPresident and Chief Operating Officergrier@prospectstreet.com(212) 448-9577