JZ Capital Ptnrs Ltd JZCP agrees amendments to its Senior Facility

 
TIDMJZCP TIDMJZCC TIDMJZCN 
 
JZ CAPITAL PARTNERS LIMITED 
(a closed-end collective investment scheme incorporated with limited liability 
           under the laws of Guernsey with registered number 48761) 
                           LEI: 549300TZCK08Q16HHU44 
 
                 JZCP agrees amendments to its Senior Facility 
 
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF THE MARKET 
ABUSE REGULATION (EU) NO. 596/2014 ("MAR"). 
 
 
23 October 2020 
 
JZ Capital Partners Limited ("JZCP" or the "Company"), the London listed fund 
that invests in US and European micro-cap companies and US real estate, is 
today pleased to announce that it has reached agreement with its senior lenders 
to amend the terms of its existing senior facility agreement (the "Senior 
Facility"). 
 
As announced on 8 October 2020, the Company had breached its minimum asset 
coverage ratio under the Senior Facility and was also in default under the 
facility having not agreed to amended terms with its senior lenders by 7 
October 2020. It was also noted in that announcement that, if the existing or 
any other event of default under the Senior Facility were to continue, the 
Company would be prohibited from making payments to the holders of its 
Convertible Unsecured Loan Stock due 2021 ("CULS") on any subsequent CULS 
interest payment date, absent either a waiver, a further consent or the amended 
terms of the facility allowing for such payments to be made. 
 
The Company is however now pleased to announce that its senior lenders have 
waived the Company's aforementioned and other technical breaches and defaults, 
with agreement also having been reached as to the amended terms of the Senior 
Facility by way of the Company's entry into an amendment agreement to the 
facility (the "Amended Senior Facility) with, among others, Guggenheim Partners 
Europe Limited as a senior lender, administrative agent for the senior lenders 
and collateral agent. 
 
Under the terms of the Amended Senior Facility, approximately US$40 million of 
the outstanding principal amount of approximately US$150 million under the 
Senior Facility has been assigned from the existing lenders to clients and 
funds advised by Cohanzick Management, LLC and CrossingBridge Advisors, LLC. 
The replacement lenders (of approximately US$40 million of the outstanding 
principal amount) have agreed, pursuant to an agreement among lenders, to be 
subordinated to the existing lenders (of approximately US$110 million of the 
outstanding principal amount) under the Amended Senior Facility. In exchange, 
it has been agreed under the Amended Senior Facility that the interest rate 
payable by the Company for the loans funded by the replacement lenders will 
accrue interest at a rate of Libor + 11.00%, instead of Libor + 5.75% as is 
applicable to the existing lenders. 
 
The Company has in turn secured more advantageous terms for itself including 
the minimum asset coverage covenant being reset (from not less than 4.00:1.00 
to a lower threshold of initially not less than 3.25 to 1.00 and from 
completion of the recently announced Secondary Sale or 7 December 2020, 
whichever is earlier, not less than 3.50:1.00) and a relaxation of rating 
requirements, removal of certain concentration limits, updates to the use of 
proceeds requirements pertaining to asset sales to preserve liquidity, and 
reduced requirements related to its real estate collateral and reporting on 
investments. The Company has also agreed to certain limitations on permitted 
investments going forwards (consistent with its recently amended and restated 
investment policy), reductions to its permitted unsecured indebtedness and 
encumbrances, and certain restrictions on dividends until the senior debt is 
repaid. 
 
In addition, as part of the recently announced Secondary Sale, which is 
expected to close following approval of the Company's ordinary shareholders in 
early December 2020, the Company has agreed that US$70 million of any proceeds 
received by the Company from that sale and other recent sales will be used to 
repay the senior lenders. As mentioned above, the replacement lenders will be 
subordinated to the existing lenders under the Amended Senior Facility and as 
such the repayment of any such proceeds of US$70 million will first be applied 
to the existing lenders, such that thereafter the outstanding loans from the 
existing lenders will be reduced from approximately US$110 million to 
approximately US$40 million and the outstanding loans from the replacement 
lenders will remain at approximately US$40 million. Completion of the Secondary 
Sale by 7 December 2020 is, among others, a condition subsequent of the Amended 
Senior Facility. 
 
The term of the Amended Senior Facility remains as expiring on 12 June 2021 
with repayment falling due on the same date, albeit with the possibility of 
extension in certain limited circumstances. 
 
For completeness, the Company notes that following completion of the Secondary 
Sale and use of any proceeds therefrom and other recent sales to make the 
repayment of US$70 million to the existing lenders under the Amended Senior 
Facility, the Company's approximate key debt obligations will be as follows: 
(i) senior debt of approximately US$80 million pursuant to the Amended Senior 
Facility (due 12 June 2021), (ii) CULS of approximately GBP38.9m (due 30 July 
2021), and (iii) the Company's Zero Dividend Preference Shares of approximately 
GBP57.6m (due 1 October 2022). 
 
Also for completeness and by reference to its earlier announcements, the 
Company last of all notes that, as at this time it is no longer in default 
under the Senior Facility, the Company is currently no longer prohibited from 
making interest payments to the holders of the CULS. The Company will also be 
continuing to make announcements as required in relation to developments and 
the realisation of its strategy as matters progress. 
 
Market Abuse Regulation: 
 
The information contained within this announcement is inside information as 
stipulated under MAR. Upon the publication of this announcement, this inside 
information is now considered to be in the public domain. The person 
responsible for arranging for the release of this announcement on behalf of 
JZCP is David Macfarlane, Chairman of JZCP. 
 
For further information: 
 
Ed Berry                                                       [phone] 
FTI Consulting                                                 1046 
 
David Zalaznick                                                +1 (212) 485 
Jordan/Zalaznick Advisers, Inc.                                9410 
 
Sam Walden                                                     +44 (0)1481 
Northern Trust International Fund Administration Services      745385 
(Guernsey) Limited 
 
Important Notice 
 
This announcement includes statements that are, or may be deemed to be, 
"forward-looking statements". These forward-looking statements can be 
identified by the use of forward-looking terminology, including the terms 
"believes", "estimates", "anticipates", "expects", "intends", "may", "will" or 
"should" or, in each case, their negative or other variations or comparable 
terminology. These forward-looking statements relate to matters that are not 
historical facts. By their nature, forward-looking statements involve risks and 
uncertainties because they relate to events and depend on circumstances that 
may or may not occur in the future. Forward-looking statements are not 
guarantees of future performance. The Company's actual investment performance, 
results of operations, financial condition, liquidity, policies and the 
development of its strategies may differ materially from the impression created 
by the forward-looking statements contained in this announcement. In addition, 
even if the investment performance, result of operations, financial condition, 
liquidity and policies of the Company and development of its strategies, are 
consistent with the forward-looking statements contained in this announcement, 
those results or developments may not be indicative of results or developments 
in subsequent periods. These forward-looking statements speak only as at the 
date of this announcement. Subject to their legal and regulatory obligations, 
each of the Company, the Investment Adviser and their respective affiliates 
expressly disclaims any obligations to update, review or revise any 
forward-looking statement contained herein whether to reflect any change in 
expectations with regard thereto or any change in events, conditions or 
circumstances on which any statement is based or as a result of new 
information, future developments or otherwise. 
 
 
 
END 
 

(END) Dow Jones Newswires

October 23, 2020 02:00 ET (06:00 GMT)