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JZCLF - JZ Capital Partners Closed Fund News Story

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JZ Capital Ptnrs Ltd: JZCP agrees amendments to its Senior Facility

(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


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

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 £38.9m (due 30 July
2021), and (iii) the Company's Zero Dividend Preference Shares of
approximately £57.6m (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 FTI Consulting                                                                  +44 (0) 20 3727 1046  
 David Zalaznick Jordan/Zalaznick Advisers, Inc.                                          +1 (212) 485 9410     
 Sam Walden Northern Trust International Fund Administration Services (Guernsey) Limited  +44 (0)1481 745385    

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.

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