CAPITALA FINANCE CORP. (NASDAQ:CPTA) Files An 8-K Entry into a Material Definitive Agreement

CAPITALA FINANCE CORP. (NASDAQ:CPTA) Files An 8-K Entry into a Material Definitive Agreement

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Item1.01

Entry into a Material Definitive Agreement.

On June 16, 2017, Capitala Finance Corp. (the Company) entered
into Amendment No. 2 (the Amendment) to its Senior Secured
Revolving Credit Agreement with ING Capital LLC, as
administrative agent, arranger and bookrunner, and the lenders
party thereto (the Credit Facility).

The Amendment amended the Credit Facility to, among other things,
(a) modify the size of the current revolver commitments under the
Credit Facility to $114.5 million, (b) expand the accordion
feature of the Credit Facility to $200 million, (c) provide for
the ability to step-down the pricing of the Credit Facility from
LIBOR plus 3.00% to LIBOR plus 2.75% when certain conditions are
met, (d) extend the expiration of the revolving period to June
16, 2020, during which period the Company, subject to certain
conditions, may make borrowings under the Credit Facility, and
(e) extend the stated maturity date of the Credit Facility to
June 16, 2021.

Borrowings under the Credit Facility continue to bear interest,
at the Companys election, at a rate per annum equal to (i) the
one, two, three or six month LIBOR, as applicable, plus 3.00% (in
the case of eurocurrency loans) or (ii) 2.00% plus the highest of
(A) a prime rate, (B) the Federal Funds rate plus 0.5%, (C) three
month LIBOR plus 1.0% and (D) zero (in the case of alternate base
rate loans). The Company will continue to pay an unused
commitment fee at a rate of 2.50% per annum on the amount (if
positive) by which 40% of the aggregate commitments under the
Credit Facility exceeds the outstanding amount of loans under the
Credit Facility and 0.50% per annum on any remaining unused
portion of the Credit Facility.

The Credit Facility will continue to be secured by a first
priority security interest in all of the Companys portfolio
investments (other than those held by the Companys existing Small
Business Investment Company (SBIC) subsidiaries), equity
interests in certain of the Companys direct and indirect
subsidiaries (other than the Companys existing SBIC subsidiaries)
and substantially all of the Companys other assets. Any future
subsidiaries formed by the Company (other than SBIC subsidiaries
or certain special purpose financing subsidiaries) will be
required to guarantee the Credit Facility and pledge all of their
assets in support of such guarantee. The Credit Facility
continues to contain certain customary affirmative and negative
covenants and events of default. In particular, the Credit
Facility contains certain financial covenants that, among other
things, require the Company to maintain a minimum amount of
equity supporting the Credit Facility and to maintain compliance
with certain collateral concentration limits, quality and
coverage tests.

The description above is only a summary of the material
provisions of the Amendment to the Credit Facility and the
related Amendment No. 1 to the Guarantee, Pledge and Security
Agreement and both are qualified in their entirety by reference
to the copies of the Form of Amendment No. 2 to the Senior
Secured Revolving Credit Agreement and the Form of Amendment No.
1 to the Guarantee, Pledge and Security Agreement, which are
filed as Exhibits 10.1 and 10.2, respectively, to this current
report on Form 8-K and are incorporated herein by reference
thereto.

On June 20, 2017, the Company issued a press release regarding
the matters described herein, a copy of which is attached hereto
as Exhibit 99.1 and incorporated by reference herein.

Item2.03 Creation of a Direct Financial Obligation or an
Obligation under an Off-Balance Sheet Arrangement of a
Registrant.

The disclosure set forth above under Item 1.01 is incorporated by
reference herein.

Item9.01 Financial Statements and Exhibits.
(a) Not applicable.
(b) Not applicable.
(c) Not applicable.
(d) Exhibits.
Exhibit No. Description
10.1 Form of Amendment No. 2, dated as of June 16, 2017, to the
Senior Secured Revolving Credit Agreement, dated as of
October 17, 2014, among Capitala Finance Corp., as borrower,
the lenders from time to time party thereto, and ING Capital
LLC, as administrative agent, arranger and bookrunner, and
First National Bank of Pennsylvania, as documentation agent.
10.2 Form of Amendment No. 1, dated as of June 16, 2017, to the
Guarantee, Pledge and Security Agreement dated October 17,
2014, among Capitala Finance Corp., as borrower, the
subsidiary guarantors party thereto, ING Capital LLC, as
revolving administrative agent for the revolving lenders and
as collateral agent, and each financing agent and designated
indebtedness holder party thereto.
99.1 Press release dated June 20, 2017.



Capitala Finance Corp. Exhibit
EX-10.1 2 v469295_ex10-1.htm EXHIBIT 10.1   Exhibit 10.1     [FORM OF AMENDMENT NO. 2 TO SENIOR SECURED REVOLVING CREDIT AGREEMENT]   AMENDMENT NO. 2 TO SENIOR SECURED REVOLVING CREDIT AGREEMENT   This AMENDMENT NO. 2 (this “Amendment”) dated as of June 16,…
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About CAPITALA FINANCE CORP. (NASDAQ:CPTA)

Capitala Finance Corp. is an externally managed non-diversified, closed-end management investment company. The Company’s investment objective is to generate both current income and capital appreciation through debt and equity investments. Both directly and through its subsidiaries that are licensed by the United States Small Business Administration (SBA), the Company offers financing to business owners, management teams and financial sponsors for change of ownership transactions, recapitalizations, strategic acquisitions, business expansion and other growth initiatives. It invests in mezzanine, senior subordinated and unitranche debt, as well as senior and second-lien loans and, to a lesser extent, equity securities issued by lower middle-market and middle-market companies. It invests in various sectors, which include oil and gas services, consumer electronics, transportation, financial services and business services. It is managed by Capitala Investment Advisors, LLC.

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