Prospect Capital Corporation (PSEC) Earnings Call Transcript & Summary

Good morning, ladies and gentlemen. Hello. Good morning, ladies and gentlemen. I am John Barry, Chief Executive Officer and Chairman of the Board of Directors of Prospect Capital Corporation, which I referred to as the Corporation. On behalf of the Corporation, I welcome you, and thank you for attending the June 12, 2020 Special Meeting of Stockholders of the Corporation. Before turning to formal items of business, I would like to introduce Kristin Van Dask, Chief Financial Officer and Secretary of the Corporation; Grier Eliasek, President, Chief Operating Officer and a Director of the Corporation; Geraldine Lippman, a representative of AST and Sean Butcher, a representative of AST, with Mr. Butcher acting as Inspector. Ms. Van Dask will act as Secretary. The Board of Directors has designated me as Chief Executive Officer of the Corporation, to call this meeting to order and act as Chairman. The meeting is now called to order. As indicated in the notice of special meeting, and accompanying documents mailed to all shareholders, we are here to consider one proposal to authorize the Corporation with approval of its Board to sell shares of its common stock during the next 12 months at a price or prices below the Corporation than current net asset value per share in 1 or more offerings, subject to certain conditions as set forth in the proxy, including that the number of shares sold on any given date does not exceed 25% of its outstanding common stock immediately prior to such sale. The agenda for today's meeting, a copy of which is available on the meeting website sets forth the proposal for stockholders' consideration and the order of business. Ms. Van Dask is directed to file the agenda with the minutes of the meeting. We will conduct the formal part of the meeting. And once the votes have been taken, we will adjourn the meeting. The polls for the matter upon which shareholders will vote at this meeting will open when that matter is call to a vote and will remain open until I announce that the polls are closed. No web votes or proxies or revocations of or changes to web votes or proxies will be accepted after the polls are closed. Near the end of the meeting, after the report on the tabulation of the voting, I will announce the voting results. The Board of Directors of the Corporation has fixed the close of business on April '20, 2020, as a record date for the determination of stockholders of the Corporation entitled to receive notice of and to vote at this meeting. An affidavit of mailing certifies to the timely mailing on April 22, 2020, of the meeting notice, proxy statement and proxy card to all shareholders of record on the record date. The secretary of the meeting is directed to file the affidavit of mailing and the notice of meeting with the minutes of this meeting. The Board of Directors of the Corporation has appointed Sean Butcher, a representative of AST Fund Solutions as inspector of election to tabulate the votes of stockholders on the matters submitted for stockholder action at this meeting. Mr. Butcher has taken the oath of office. The presence at the meeting or by proxy of stockholders entitled to cast a majority of the votes entitled to be cast at this meeting constitutes a quorum. Each share is entitled to 1 vote. I now ask Mr. Butcher to furnish us with a count remotely via web interface or through representation by proxy of shares present at this meeting.

There are present at this meeting remotely via web interface or through representation by proxy, a total of 245,557,546 shares of common stock of the Corporation.

There being a majority of shares of common stock represented at this meeting out of a total of 368 million such shares entitled to vote, I hereby declare that a quorum exists. Approval of the proposal may be obtained in either of 2 ways. First, the proposal may be approved if the Corporation obtains affirmative vote of a majority of the outstanding shares. And two, a majority of the outstanding shares of common stock entitled to vote at this special meeting that are not held by affiliated persons of the corporation. For purposes of this alternative, the Investment Company Act of 1940 defines the majority of the outstanding shares as 67% or more of the voting securities present at a meeting if the holder of more than 50% of the outstanding voting securities of such company are present or represented by proxy, or 50% of the outstanding voting securities of the company, whichever is less. Second, the proposal will also be approved if the Corporation receives approval from a majority of the number of the beneficial holders of its common stock entitled to vote at this special meeting without regard to whether a majority of such shares are voted in favor of the proposal. Abstentions and broker nonvotes will have the effect of a vote against. If you've already given your proxy to management, you need not vote at this meeting. Since the persons designated as proxies will vote for you as indicated in the proxy cards. However, you may revoke your proxy by voting at this meeting, if you so desire. If you wish to vote at this meeting, when directed, you must click the link you see in the message or chat box in the web interface for the meeting, enter your 15 digit control number and vote by following the instructions on the website. To which you were directed for voting. The sole matter to be voted on is a proposal to authorize the Corporation with approval of its Board to sell shares of its common stock during the next 12 months at a price or prices below the Corporation's then current net asset value per share in 1 or more offerings subject to certain conditions as set forth in the proxy statement, including that the number of shares sold on any given date does not exceed 25% of its outstanding common stock immediately prior to such sale. Please submit your votes by clicking on the link in the message or chat box in the web interface for the meeting and following the instructions that appear. The link should be for the website, voteproxyonline.com. Voting on the proposal is now closed. The votes will now be tabulated, following which we will announce the results of the vote. I now ask the inspector to report the results of the vote.

We received, including affiliated and unaffiliated shares of 201,726,253 shares for; 38,195,487 shares against; and 5,635,807 votes that had abstained from voting to approve the proposal. We received, excluding affiliated shares, 106,924,302 votes for; 38,195,487 votes against; and 5,635,807 votes that abstained from voting to approve the proposal.

I hereby declare that the proposal has been duly adopted and is hereby approved. The inspector will file the report with respect to the final results of the voting in the minutes of this meeting. That concludes the formal business of the meeting. Thank you for attending. Thank you, Ms. Lippman and Mr. Butcher of AST. Ms. Van Dask, Sean Dailey and their respective teams for their hard work during this process, including Peter Cowgill. Thank you all. Have a wonderful afternoon. Bye now.

This concludes the meeting. You may now disconnect.