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Prospect Capital Provides Acquisition and Growth Financing to Ken-Tex
| Source: Prospect Capital Corporation
NEW YORK, NY--(Marketwire - June 5, 2007) - Prospect Capital Corporation (NASDAQ : PSEC )
("Prospect") announced today that it has provided growth financing of
approximately $10.8 million to Ken-Tex Energy Corp. ("Ken-Tex"), located in
Dallas, Texas.
Founded in 1995, Ken-Tex is an independent energy company engaged in the
development and production of crude oil and natural gas hydrocarbons in
East Texas. Ken-Tex owns 18,000 net acres in the Brookeland Field in San
Augustine, Jasper, and Angelina Counties in the vicinity of the Sam Rayburn
Reservoir. The Brookeland Field is part of the Austin Chalk play, a
prolific, fractured oil reservoir stretching from Texas to Louisiana.
Ken-Tex focuses on the drilling of K-lateral wells in new and existing
wellbores to maximize recovery of leased reserves. Ken-Tex is led by Samuel
Spicer, who has more than two decades of experience in the oil and gas
industry, and who serves on the board of directors of Sovereign Bank in
Dallas.
Ken-Tex is utilizing Prospect's financing for the acquisition of a larger
working interest in its leasehold, the drilling of additional K-laterals,
and the acquisition of adjacent leases. Prospect's co-investor is an
affiliate of Petro Capital Group, an experienced investment firm in Dallas.
Prospect's investment is in the form of a senior secured debt instrument
with a first lien on all assets of Ken-Tex, including receivables, wells,
leases, pipelines, and other surface infrastructure. Prospect has received
a significant overriding royalty interest and net profit interest as part
of its investment.
"Prospect Capital is an ideal partner for our growth and development
needs," said Samuel Spicer, CEO of Ken-Tex.
"Given the management team's track record, we are pleased to be supporting
its capital requirements," said David Belzer, a managing director with
Prospect Capital Management.
ABOUT PROSPECT CAPITAL CORPORATION
Prospect Capital Corporation (www.prospectstreet.com) is a closed-end
investment company that lends to and invests in private and microcap public
businesses. Prospect Capital's investment objective is to generate both
current income and capital appreciation through debt and equity
investments.
Prospect Capital has elected to be treated as a business development
company under the Investment Company Act of 1940 ("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 laws and regulations.
We have elected to be treated as a regulated investment company under the
Internal Revenue Code of 1986. Failure to comply with any of the laws and
regulations that apply to Prospect Capital could have a material adverse
effect on Prospect Capital and its shareholders.
This press release contains forward-looking statements within the meaning
of the Private Securities Litigation Reform Act of 1995. Any such
statements, other than statements of historical fact, are likely to be
affected by other unknowable future events and conditions, including
elements of the future that are or are not under the Company's control, and
that the Company 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 these estimates and projections of the future. Such
statements speak only as of the time when made, and the Company undertakes
no obligation to update any such statement now or in the future.