NEW YORK--(BUSINESS WIRE)--
Ares Capital Corporation (Nasdaq: ARCC) announced that, in connection
with an inbound inquiry from a fundamental institutional investor, it
has agreed to issue an additional $40 million aggregate principal amount
of its 4.75% Convertible Senior Notes due 2018 (the “New Convertible
Senior Notes”). The New Convertible Senior Notes will be issued as
additional notes under the indenture pursuant to which, on October 10,
2012, Ares Capital issued $230 million in aggregate principal amount of
its unsecured 4.75% Convertible Senior Notes due 2018 (the “Existing
Convertible Senior Notes,” and together with the New Convertible Senior
Notes, the “Convertible Senior Notes”). The New Convertible Senior Notes
will be treated as a single series with the Existing Convertible Senior
Notes under the indenture and will have the same terms as the Existing
Convertible Senior Notes. The New Convertible Senior Notes will have the
same CUSIP number and will be fungible with the Existing Convertible
Senior Notes. The New Convertible Senior Notes will be offered only to
qualified institutional buyers (as defined in the Securities Act of
1933, as amended (the “Securities Act”)) pursuant to Rule 144A under the
Securities Act. The closing of the transaction is subject to customary
closing conditions and the New Convertible Senior Notes are expected to
be delivered and paid for on November 13, 2012.
The Convertible Senior Notes are unsecured and bear interest at a rate
of 4.75% per year, payable semiannually. In certain circumstances, the
Convertible Senior Notes will be convertible into cash, shares of Ares
Capital’s common stock or a combination of cash and shares of Ares
Capital’s common stock, at Ares Capital’s election, at an initial
conversion rate of 50.3290 shares of common stock per $1,000 principal
amount of Convertible Senior Notes, which is equivalent to an initial
conversion price of approximately $19.87 per share of Ares Capital’s
common stock, subject to customary anti-dilution adjustments. The
conversion price is approximately 15.9% above the $17.15 per share
closing price of Ares Capital’s common stock on November 7, 2012. Ares
Capital will not have the right to redeem the Convertible Senior Notes
prior to maturity. The Convertible Senior Notes will mature on January
15, 2018, unless repurchased or converted in accordance with their terms
prior to such date.
Ares Capital expects to use the net proceeds of this offering to repay
or repurchase certain outstanding indebtedness, which may include
repaying outstanding indebtedness under its debt facilities and, to the
extent not applied for such purpose, for general corporate purposes,
including investing in portfolio companies in accordance with its
investment objective.
Neither the Convertible Senior Notes nor the common stock that may be
issued upon conversion thereof will be registered under the Securities
Act. Neither the Convertible Senior Notes nor the common stock that may
be issued upon conversion thereof may be offered or sold in the United
States absent registration or an applicable exemption from the
registration requirements of the Securities Act.
This press release is not an offer to sell any securities of the Company
and is not soliciting an offer to buy such securities in any state where
such offer and sale is not permitted. It is issued pursuant to Rule 135c
under the Securities Act.
FORWARD-LOOKING STATEMENTS
Statements included herein may constitute “forward-looking statements,”
which relate to future events or our future performance or financial
condition. These statements are not guarantees of future performance,
condition or results and involve a number of risks and uncertainties.
Actual results may differ materially from those in the forward-looking
statements as a result of a number of factors, including those described
from time to time in our filings with the Securities and Exchange
Commission. Ares Capital undertakes no duty to update any
forward-looking statements made herein.
Ares Capital Corporation
Carl Drake, 404-814-5204
Source: Ares Capital Corporation
