NEW YORK, NY — (MARKET WIRE) — 08/29/07 — Prospect Capital Corporation (NASDAQ: PSEC)(“Prospect”) announced today that it has provided growth andrecapitalization financing of approximately $9.2 million to DiamondbackOperating, LP (“Diamondback”), an oil and gas production company based inTulsa, Oklahoma.
Diamondback is a subsidiary of Patrick Petroleum, LLC, an oil and gasdevelopment and production company founded in 1998. Mark Patrick and U.E.”Pat” Patrick, the principals of Diamondback, have built an extensive trackrecord managing coalbed methane and other oil and gas projects in theCherokee Basin, Arkoma Basin, and elsewhere. Pat Patrick was previously theCEO of Patrick Petroleum Company, a NYSE company with over 300 employeesand eight division offices. Patrick Petroleum Company was sold to GoodrichPetroleum Company in 1995. Diamondback has assembled an approximately40,000 acre position in the Rock Springs project in Edwards and Realcounties in the Kerr Basin of Southwest Texas. Diamondback produces gas inthe Wolfcamp coalbed methane seams as well in the Canyon Sands in the RockSprings project.
Diamondback is utilizing Prospect’s financing for development drilling andrepayment of existing liabilities. Prospect’s investment is in the form ofa senior secured debt instrument. Prospect has received a net profitinterest in Diamondback as part of its investment.
“We are excited to have Prospect as a financing partner, and look forwardto growing value in the Rock Springs project,” said Mark Patrick, Presidentof Diamondback.
“The Diamondback team has decades of experience in the oil and gasindustry, with that track record being a significant reason for ourenthusiasm for working with the Patricks,” said Mark Hull, an investmentprofessional 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