NEW YORK, NY — (MARKET WIRE) — 12/11/07 — Prospect Capital Corporation (NASDAQ: PSEC)(“Prospect”) announced today that it has made a second lien secured debtinvestment of $15 million in Deb Shops, Inc. (“DEB”), a leading specialtyapparel retailer based in Philadelphia, Pennsylvania.
Founded in 1932, DEB offers value-oriented apparel to junior and juniorplus-size female consumers, targeting the ages of 10 through 25, a rapidlygrowing demographic. DEB is the only national retailer to offer both juniorregular and plus-sized apparel in a unified store format. DEB hasapproximately 337 stores in regional malls and strip shopping centers in 42states, with a concentration in the Midwest and Northeast.
Prospect’s second lien secured debt, along with other financing, supportsthe acquisition of DEB by an affiliate of Lee Equity Partners (“LeeEquity”), a New York-based private equity firm founded by Thomas H. Lee.
Allen Questrom, a Senior Advisor to Lee Equity, and former Chief ExecutiveOfficer of JC Penney, Federated Department Stores, Neiman Marcus, andBarneys New York, has joined DEB as its new non-executive Chairman.
“I have personally known the senior team at Prospect for more than adecade, and we welcome their support of our acquisition,” said BenjaminHochberg, partner with Lee Equity.
“Deb Shops continues an important strategic thrust by Prospect to providefinancing to top-tier private equity sponsors,” said Gautam Shirhattikar,an investment professional with Prospect Capital Management.
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.
Please send investment proposals to:Grier EliasekPresident and Chief Operating Officergrier@prospectstreet.com(212) 448-9577