NEW YORK, NY — (MARKETWIRE) — 06/05/07 — Prospect Capital Corporation (NASDAQ: PSEC)(“Prospect”) announced today that it has provided growth financing ofapproximately $10.8 million to Ken-Tex Energy Corp. (“Ken-Tex”), located inDallas, Texas.
Founded in 1995, Ken-Tex is an independent energy company engaged in thedevelopment and production of crude oil and natural gas hydrocarbons inEast Texas. Ken-Tex owns 18,000 net acres in the Brookeland Field in SanAugustine, Jasper, and Angelina Counties in the vicinity of the Sam RayburnReservoir. The Brookeland Field is part of the Austin Chalk play, aprolific, fractured oil reservoir stretching from Texas to Louisiana.Ken-Tex focuses on the drilling of K-lateral wells in new and existingwellbores to maximize recovery of leased reserves. Ken-Tex is led by SamuelSpicer, who has more than two decades of experience in the oil and gasindustry, and who serves on the board of directors of Sovereign Bank inDallas.
Ken-Tex is utilizing Prospect’s financing for the acquisition of a largerworking interest in its leasehold, the drilling of additional K-laterals,and the acquisition of adjacent leases. Prospect’s co-investor is anaffiliate of Petro Capital Group, an experienced investment firm in Dallas.Prospect’s investment is in the form of a senior secured debt instrumentwith a first lien on all assets of Ken-Tex, including receivables, wells,leases, pipelines, and other surface infrastructure. Prospect has receiveda significant overriding royalty interest and net profit interest as partof its investment.
“Prospect Capital is an ideal partner for our growth and developmentneeds,” said Samuel Spicer, CEO of Ken-Tex.
“Given the management team’s track record, we are pleased to be supportingits capital requirements,” said David Belzer, a managing director withProspect 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