Notice is hereby given that Glancy Binkow & Goldberg LLP has filed a class action lawsuit in the United States District Court for the Central District of California on behalf of a class consisting of all persons or entities who purchased the securities of Kohlberg Capital Corporation (“Kohlberg” or the “Company”) (Nasdaq:KCAP) between March 16, 2009 and December 24, 2009, inclusive (the “Class Period”). A copy of the Complaint is available from the court or from Glancy Binkow & Goldberg LLP. Please contact us by phone to discuss this action or to obtain a copy of the Complaint at (310) 201-9150 or Toll Free at (888) 773-9224, by email at email@example.com, or visit our website at http://www.glancylaw.com. The Complaint charges Kohlberg and certain of the Company’s executive officers and/or directors with violations of federal securities laws. Kohlberg is an investment company which originates, structures, finances and manages a portfolio of term loans, mezzanine investments and selected equity securities in middle market companies. The Complaint alleges that throughout the Class Period defendants knew or recklessly disregarded that their public statements concerning Kohlberg’s operations and financial performance were materially false and misleading. Specifically, plaintiff alleges the Company reported inflated earnings that violated Generally Accepted Accounting Principles (“GAAP”) by failing to properly account for the fair value of its investment portfolio under FASB Statement of Financial Accounting Standards No. 157 - Fair Value Measurements. On November 9, 2009, Kohlberg announced its auditor, Deloitte & Touche LLP (“Deloitte”), raised questions concerning the Company’s methodology and process in valuing its loan portfolio under GAAP. As a result of these questions, the Company stated it would not be able to timely file with the SEC its third quarter results for the period ended September 30, 2009. As a result, the Company’s stock price fell $0.56 per share, or more than 10%, to close at $4.96.
On December 15, 2009 Kohlberg announced that its financial statements for the fiscal year ended December 31, 2008 and the first two quarters of 2009 should no longer be relied upon, due to issues regarding valuation of the Company’s loan portfolio.On December 24, 2009, Kohlberg filed with the Securities and Exchange Commission a letter it received from Deloitte, in which Deloitte disagreed with many of Kohlberg’s contentions in its recent disclosures. Deloitte stated, among other things: (a) that management essentially ceased providing substantive information about the Company’s valuation of its loan portfolio to Deloitte on December 14, 2009; (b) that significant unanswered and unfulfilled information requests remain outstanding; (c) that Kohlberg had previously provided Deloitte a revised valuation of the Company’s loan portfolio as of December 31, 2008, which reflected a material reduction in the fair value of the Company’s loan portfolio investments as of that date, but that those revisions had not been shown to certain Kohlberg board members as of December 15, 2009; and (d) that Deloitte now believes the information supporting the fair values reflected in the Company’s previously issued 2008 and interim financial statements was and continues to be incomplete and inaccurate. In response to this news, over the next two trading days, shares of Kohlberg declined $0.44 per share or 8.5% per share, to close at $4.72 on December 29, 2009. Plaintiff seeks to recover damages on behalf of class members and is represented by Glancy Binkow & Goldberg LLP, a law firm with significant experience in prosecuting class actions, and substantial expertise in actions involving corporate fraud. If you are a member of the class described above, you may move the Court, no later than March 1, 2010, to serve as lead plaintiff, however, you must meet certain legal requirements. If you wish to discuss this action or have any questions concerning this Notice or your rights or interests with respect to these matters, please contact Michael Goldberg, Esquire, of Glancy Binkow & Goldberg LLP, 1801 Avenue of the Stars, Suite 311, Los Angeles, California 90067, by telephone at (310) 201-9150 or Toll Free at (888) 773-9224, by e-mail to firstname.lastname@example.org, or visit our website at http://www.glancylaw.com.