NEW YORK, Jan. 27, 2018 /PRNewswire/ -- Pomerantz LLP
announces that a class action lawsuit has been filed against Capitala Finance Corporation ("Capitala" or the "Company")
(NASDAQ: CPTA) and certain of its officers. The class action, filed in United States
District Court, for the Central District of California, Western Division, and docketed under
18-cv-00052, is on behalf of a class consisting of investors who purchased or otherwise acquired Capitala securities, seeking to
recover compensable damages caused by defendants' violations of the Securities Exchange Act of 1934.
If you are a shareholder who purchased Capitala securities between January 4, 2016, and
August 7, 2017, both dates inclusive, you have until February 26,
2018, to ask the Court to appoint you as Lead Plaintiff for the class. A copy of the Complaint can be obtained at
www.pomerantzlaw.com. To discuss this action,
contact Robert S. Willoughby at rswilloughby@pomlaw.com or 888.476.6529 (or 888.4-POMLAW), toll-free, Ext. 9980. Those who inquire by e-mail are
encouraged to include their mailing address, telephone number, and the number of shares purchased.
[Click here to join
this class action]
Capitala Finance Corporation is a business development company that invests primarily in first and second liens, subordinated
debt and, to a lesser extent, equity securities issued by lower and traditional middle-market companies.
Capitala Investment Advisors, LLC ("Capitala Investment Advisors") manages the Company's investment activities. The Company's
Board of Directors supervises the Company's investment activities. The Company's executive officers are part of Capitala
Investment Advisors' management team.
Under the Company's investment advisory agreement with Capitala Investment Advisors (the "Investment Advisory Agreement"), the
Company pays Capitala Investment Advisors an annual base management fee based on the Company's gross assets as well as an
incentive fee based on the Company's performance.
On January 4, 2016, the Company announced that Capitala Investment Advisors agreed to
voluntarily waive its quarterly incentive fee.
The Complaint alleges that throughout the Class Period, Defendants made materially false and misleading statements regarding
the Company's business, operational and compliance policies. Specifically, Defendants made false and/or misleading statements
and/or failed to disclose that: (i) Capitala Investment Advisors had been losing professional talent in both underwriting
and portfolio management due to the waiving of its incentive fee; (ii) such loss of talent negatively impacted the quality of the
Company's investment portfolio; and (iii) as a result, Capitala's public statements were materially false and misleading at all
relevant times.
On August 7, 2017, the Company revealed during aftermarket hours that six of its investments
were on non-accrual status—twice as many as in the previous quarter.
On August 8, 2017, the Company's Chief Executive Officer Joseph B. Alala
III revealed that Capitala Investment Advisors had been losing professional talent in underwriting and portfolio
management since waiving its incentive fee, which resulted in a rising number of nonaccrual investments.
On this news, shares of the Company fell $3.82 per share, or approximately 30%, over the next
three trading days to close at $8.99 per share on August 10, 2017,
damaging investors.
The Pomerantz Firm, with offices in New York, Chicago,
Los Angeles, and Paris, is acknowledged as one of the premier
firms in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham
L. Pomerantz, known as the dean of the class action bar, the Pomerantz Firm pioneered the field of securities class
actions. Today, more than 80 years later, the Pomerantz Firm continues in the tradition he established, fighting for the rights
of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered numerous
multimillion-dollar damages awards on behalf of class members. See www.pomerantzlaw.com
CONTACT:
Robert S. Willoughby
Pomerantz LLP
rswilloughby@pomlaw.com
888.476.6529 Ext. 9980
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SOURCE Pomerantz LLP