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MVC > SEC Filings for MVC > Form 8-K on 5-Aug-2013All Recent SEC Filings

Show all filings for MVC CAPITAL, INC.

Form 8-K for MVC CAPITAL, INC.


Creation of a Direct Financial Obligation or an Obligation under an Off-Balance

ITEM 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

On July 31, 2013, MVC Capital, Inc. (the "Fund") entered into a one-year, $50 million revolving credit facility (the "Credit Facility") with Branch Banking and Trust Company ("BB&T"). That same day, the Fund borrowed $50 million under the Credit Facility. The Credit Facility will expire on July 31, 2014, at which time all outstanding amounts under the Credit Facility will be due and payable.

Borrowings under the Credit Facility will bear annual interest at LIBOR plus 100 basis points. In addition, the Fund is subject to a 25 basis point per annum utilization fee, payable quarterly in arrears, on the aggregate of the daily average amounts of the Credit Facility not drawn down by the Fund, as well as an upfront 20 basis point fee on the lesser of $50 million or 90% of the value of the Fund's assets held at BB&T for purposes of securing the Credit Facility. Borrowings under the Credit Facility will be secured by cash, short-term and long-term U.S. Treasury securities and other governmental agency securities whose purchase has been approved by BB&T.

The Credit Facility contains customary representations and warranties and affirmative and negative covenants. The Credit Facility contains customary events of default for credit facilities of this type, including (without limitation): nonpayment of principal, interest, fees or other amounts after a stated grace period; inaccuracy of material representations and warranties; change of control; violations of covenants, subject in certain cases to stated cure periods; and certain bankruptcies and liquidations. If an event of default occurs and is continuing, the Fund may be required to repay all amounts outstanding under the Credit Facility.

In addition, the Fund has entered into a Security Agreement and an Amended and Restated Custody Agreement with BB&T pursuant to which the Fund has pledged certain cash and securities to be held in a BB&T custodial account as collateral for any borrowings made by the Fund pursuant to the Credit Agreement. BB&T has the typical rights and remedies of a secured lender under the Uniform Commercial Code, including the right to foreclose on the collateral pledged by the Fund.

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