Filed pursuant to Rule 497(a)
File No. 333-232492
Rule 482ad
Capital Southwest Corporation Prices Public Offering of Additional
$65 million of 4.50% Notes due 2026 with a Yield-to-Maturity of
Approximately 4.0%
DALLAS, February 22, 2021
- Capital Southwest Corporation (NASDAQ: CSWC) (“Capital Southwest”
or the “Company”) is pleased to announce that it has priced an
underwritten public offering of an additional $65 million in
aggregate principal amount of 4.50% notes due 2026 (the “Notes”).
The Notes will be issued at a price of 102.11% of the aggregate
principal amount of the Notes, resulting in a yield-to-maturity of
approximately 4.0%.
Purchasers will be required to pay accrued and unpaid interest on
the Notes from December 29, 2020 up to, but not including, the date
of delivery of the Notes. On July 31, 2021, Capital Southwest will
pay this pre-issuance accrued interest on the Notes to the holders
of the Notes as of the applicable record date, along with interest
accrued on the Notes offered hereby from the date of delivery to
such interest payment date.
The Notes will constitute a further issuance of, have the same
terms as, rank equally in right of payment with, and be fungible
and form a single series with the $75 million in aggregate
principal amount of the 4.50% notes due 2026 that the Company
initially issued on December 29, 2020. Upon the issuance of the
Notes, the outstanding aggregate principal amount of the Company’s
4.50% notes due 2026 will be $140 million.
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 February 25,
2021.
Capital Southwest intends to use the net proceeds from this
offering to repay 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
February 19, 2021, Capital Southwest had $173.0 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 underwriter
for this 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 February 22, 2021, the preliminary
prospectus supplement dated February 22, 2021, 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 SOUTHWEST
Capital Southwest Corporation is a Dallas, Texas-based, internally
managed Business Development Company, with approximately $313
million in net assets as of December 31, 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 STATEMENTS
This 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
