November 11, 2009 (FinancialWire) — Kohlberg Capital Corp. (NASDAQ: KCAP)  has delayed the release of its full earnings results for the quarter ended September 30, 2009 while it is in discussion with its independent public accountants, Deloitte & Touche LLP (Deloitte), regarding valuation determinations under Statement of Financial Accounting Standards No. 157 — Fair Value Measurements (SFAS 157) included in its financial statements for the fiscal year ended December 31, 2008 (the “December 31, 2008 financial statements) and for subsequent interim periods in 2009.

The company has been informed by Deloitte that as a result of an annual internal inspection process, certain questions have been raised by Deloitte regarding the company’s methodology and process of valuing its loan portfolio investments under SFAS 157. Deloitte has requested information in addition to that which was previously provided by the company for purposes of its review. Deloitte issued an unqualified opinion on the December 31, 2008 financial statements, which was included in the company’s Annual Report on form 10-K filed with the Securities and Exchange Commission on March 16, 2009.

Because the company’s financial statements for the quarter ended September 30, 2009 incorporate its balance sheet as of December 31, 2008, the finalization and filing of the company’s quarterly report on form 10-Q for the third quarter of 2009 will be delayed. Accordingly, the company will be unable to file its Quarterly Report on form 10-Q for the quarter ended September 30, 2009 by the deadline, and it intends to file a Notification of Late Filing on form 12b-25 with the Securities and Exchange Commission. The company is, however, able to report that its net investment income for the nine months ended September 30, 2009 was approximately $17.9 million, or $0.81 per basic and diluted share, and for the three months ended September 30, 2009, net investment income was approximately $4.4 million, or $0.20 per basic and diluted share. The company’s third quarter net investment income of $0.20 per basic and diluted share includes the impact of higher interest costs on its credit facility due to a decision by its lenders to charge default interest, which the company disputes. The company estimates that its net investment income would have been approximately $0.29 per basic and diluted share for the quarter ended September 30, 2009 had the interest rate on its credit facility remained at its original stated terms. The company has declared year-to-date dividends of $0.72 per share, consisting of dividends of $0.24 per share in each of the first, second and third quarters of 2009. The company expects that in addition to its upcoming regular fourth quarter dividend, a further incremental or special dividend will be declared once the company has determined the amount of its remaining undistributed taxable income for 2009.

The company said its Quarterly Report on form 10-Q containing its full earnings results for the quarter ended September 30, 2009 will be filed as soon as practicable.

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