Capital Southwest Corporation Prices Public Offering of $75 million 4.50% Notes due 2026
December 22 2020 - 4:01PM
Capital Southwest Corporation (NASDAQ: CSWC) (“Capital Southwest”)
is pleased to announce that it has priced an underwritten public
offering of $75 million in aggregate principal amount of 4.50%
notes due 2026 (the “Notes”). The Notes will bear interest at a
rate of 4.50% per year, payable semi-annually, will mature on
January 31, 2026 and may be redeemed in whole or in part at Capital
Southwest’s option at any time prior to October 31, 2025, at par
plus a “make-whole” premium, and thereafter at par. The offering is
subject to customary closing conditions and is expected to close on
December 29, 2020.
Capital Southwest intends to use the net
proceeds from this offering to redeem all of its outstanding 5.95%
notes due 2022 and repay a portion of the outstanding indebtedness
under its credit facility. However, through re-borrowings under its
credit facility, Capital Southwest intends to make investments in
lower middle market and upper middle market portfolio companies in
accordance with its investment objective and strategies, and for
other general corporate purposes, including payment of operating
expenses. As of December 21, 2020, Capital Southwest had
$215.0 million of indebtedness outstanding under its credit
facility. The credit facility matures on December 21, 2023, and
borrowings under the credit facility currently bear interest on a
per annum basis equal to LIBOR plus 2.50%.
Raymond James & Associates, Inc. is acting
as sole book-running manager for this offering. Janney Montgomery
Scott LLC, Ladenburg Thalmann & Co. Inc. and National
Securities Corporation, a wholly owned subsidiary of National
Holdings Corporation (NASDAQ: NHLD), are
acting as co-managers for the offering.
Investors should carefully consider,
among other things, Capital Southwest’s investment objective and
strategies and the risks related to Capital Southwest and the
offering before investing. The pricing term sheet dated December
22, 2020, the preliminary prospectus supplement dated December 22,
2020, and the accompanying prospectus dated August 15, 2019, each
of which has been filed with the Securities and Exchange Commission
(the “SEC”), contain this and other information about Capital
Southwest and should be read carefully before
investing.
A shelf registration statement relating
to these securities is on file with and has been declared effective
by the SEC. The offering may be made only by means of a preliminary
prospectus supplement and an accompanying prospectus, copies of
which may be obtained, when available, for free by
visiting the SEC’s website at www.sec.gov or
from Raymond James & Associates, Inc., 880 Carillon
Parkway, St. Petersburg, Florida 33716, by email:
prospectus@raymondjames.com or by calling:
1-800-248-8863.
The information in the pricing term sheet, the
preliminary prospectus supplement, the accompanying prospectus and
this press release is not complete and may be changed. The pricing
term sheet, the preliminary prospectus supplement, the accompanying
prospectus and this press release do not constitute offers to sell
or the solicitation of offers to buy, nor will there be any sale of
the Notes referred to in this press release, in any state or
jurisdiction in which such offer, solicitation or sale would be
unlawful prior to the registration or qualification under the
securities laws of such state or jurisdiction.
ABOUT
CAPITAL
SOUTHWESTCapital Southwest
Corporation is a Dallas, Texas-based, internally managed Business
Development Company, with approximately $286 million in net
assets as of September 30, 2020. Capital Southwest is a
middle-market lending firm focused on supporting the acquisition
and growth of middle market businesses and makes investments
ranging from $5 to $20 million in securities across the
capital structure, including first lien, unitranche, second lien,
subordinated debt, and non-control equity co-investments. As a
public company with a permanent capital base, Capital Southwest has
the flexibility to be creative in its financing solutions and to
invest to support the growth of its portfolio companies over long
periods of time.
FORWARD-LOOKING
STATEMENTSThis press release may
contain certain forward-looking statements within the meaning of
the federal securities laws, including statements with regard to
Capital Southwest’s notes offering, the expected net proceeds from
the offering and the anticipated use of the net proceeds of the
offering. These statements are often, but not always, made through
the use of word or phrases such as “will,” “may,” “could,”
“expect,” and similar expressions and variations or negatives of
these words. These statements are based on management’s current
expectations, assumptions, and beliefs. They are not guarantees of
future results and are subject to numerous risks, uncertainties,
and assumptions that could cause actual results to differ
materially from those expressed in any forward-looking statement.
These risks include risks identified in Capital Southwest’s filings
with the SEC and risks related to, among other things: changes in
the markets in which Capital Southwest invests; changes
in the financial, capital, and lending markets; regulatory changes;
tax treatment and general economic and business conditions;
uncertainties associated with the impact from the COVID-19
pandemic, including its impact on the global
and U.S. capital markets and the global
and U.S. economy, the length and duration of the COVID-19
outbreak in the United States as well as worldwide and
the magnitude of the economic impact of that outbreak; and the
effect of the COVID-19 pandemic on our business prospects and the
operational and financial performance of our portfolio companies,
including our ability and their ability to achieve our respective
objectives, and the effects of the disruptions caused by the
COVID-19 pandemic on our ability to continue to effectively manage
our business. Readers should not place undue reliance on any
forward-looking statements and are encouraged to review Capital
Southwest’s registration statement and other SEC filings for a more
complete discussion of the risks and other factors that could
affect any forward-looking statements. Except as required by the
federal securities laws, Capital Southwest does not undertake any
obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events,
changing circumstances or any other reason after the date of this
press release.
CONTACT:
Michael S. Sarner, Chief Financial Officer
msarner@capitalsouthwest.com 214-884-3829
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