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Prospect Capital Announces Maturity Extension and Significantly Reduced Pricing on $1.5 Billion Revolving Credit Facility

September 4, 2014



ENP Newswire - 04 September 2014

Release date- 03092014 - NEW YORK, NY - Prospect Capital Corporation (NASDAQ: PSEC) announced today that it has completed the extension of the revolving credit facility for Prospect Capital Funding LLC, a consolidated subsidiary of Prospect, extending the term 5.5 years from today, increasing the size to $1.5 billion and reducing pricing to one-month Libor plus 2.25%.

The new Facility, for which $800 million of commitments have been closed to date, includes an accordion feature that allows the Facility, at Prospect's discretion, to accept up to a total of $1.5 billion of commitments. The Facility matures in March 2020. It includes a revolving period that extends through March 2019, followed by an additional one-year amortization period, with distributions allowed to Prospect after the completion of the revolving period.

Pricing for the Facility is one-month Libor plus 2.25%, which achieves a 50 basis point reduction in pricing from the previous facility pricing of Libor plus 2.75%. The new Facility has an investment grade Moody's rating of Aa3.

The Facility has no payment guarantee from Prospect to PCF, demonstrating the favorable risk-mitigating balance sheet structure of Prospect's capitalization compared to other companies in the business development company ('BDC') industry. Approximately 80% of Prospect's consolidated assets continue to be unencumbered as an attractive structure for both shareholders and unsecured creditors.

'We are pleased to announce the extension of our credit facility on favorable terms, with broad support from existing and new lenders, allowing us to secure longer-dated liabilities for the accretive benefit of our shareholders,' said Brian H. Oswald, Chief Financial Officer of Prospect. 'The reduction in pricing by 50 basis points enhances our bottom line and the extension provides continued financial flexibility.'

ABOUT PROSPECT CAPITAL CORPORATION

Prospect Capital Corporation (www.prospectstreet.com) is a business development company that focuses on lending to and investing in private businesses. Our investment objective is to generate both current income and long-term capital appreciation through debt and equity investments.

We have elected to be treated as a business development company under the Investment Company Act of 1940 (the '1940 Act'). We are required to comply with a series of regulatory requirements under the 1940 Act as well as applicable NASDAQ, federal and state rules and regulations. We have elected to be treated as a regulated investment company under Subchapter M of the Internal Revenue Code of 1986. Failure to comply with any of the laws and regulations that apply to us could have an adverse effect on us and our shareholders.

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, whose safe harbor for forward-looking statements does not apply to business development companies. Any such statements, other than statements of historical fact, are highly likely to be affected by other unknowable future events and conditions, including elements of the future that are or are not under our control, and that we may or may not have considered; accordingly, such statements cannot be guarantees or assurances of any aspect of future performance.

Actual developments and results are highly likely to vary materially from any forward-looking statements. Such statements speak only as of the time when made, and we undertake no obligation to update any such statement now or in the future.

Investor Contact:

Michael Cimini

Tel: (212) 792 2095


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Source: ENP Newswire


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