American Capital Invests in Safemark Acquisition

American Capital
Strategies Ltd. announced today it has invested $31 million in the
acquisition of Safemark Systems L.P., a leading supplier of in-room safes
to the hospitality industry, from Richards Capital Fund L.P. American
Capital’s investment takes the form of a senior term loan, senior
subordinated debt, junior subordinated debt with warrants and redeemable
preferred and common equity. American Capital is also providing a
revolving credit facility. American Capital owns approximately 75% of
Safemark on a fully diluted basis, with the balance owned by management.
“Our investment in Safemark is American Capital’s sixth announced buyout
this year,” said American Capital COO Ira Wagner. “The transaction
demonstrates American Capital’s ability to find exceptional middle market
companies, negotiate an appropriate transaction, conduct intense in house
due diligence and quickly bring a transaction to closing.”

American Capital has invested over $1.3 billion in the last twelve months
and over $600 million year to date. For more information about American
Capital’s portfolio, go to
http://www.acas.com/our_portfolio/our_portfolio.cfm.

“Safemark’s strong historical financial performance, large installed base
with recurring revenue stream, low cost, high quality procurement and
outstanding management team have made it an attractive investment.
Additionally, management’s significant rollover and continued ownership
demonstrate their confidence in the business,” said American Capital
Managing Director Robert Klein.

“With strong alliances with leading national hotel chains and franchises,
Safemark can capitalize on improving hotel industry fundamentals,
including a recovery from a travel downturn fueled by an improving economy
and increased business travel, and increasing demand for in-room safes to
safeguard highly valuable portable consumer electronics. We’re looking
forward to working with management as it grows Safemark through increased
market penetration and expansion into other high potential markets,” added
American Capital Principal Todd Wilson.

Founded in 1983, Orlando, FL-based Safemark Systems is a supplier of safes
used in hotel guestrooms. The company offers a broad range of safe
products through direct purchase and leasing options. Safemark has
significant customer relationships with such vendors as Cendant
Corporation, Choice Hotels International, and Prime Hospitality and has an
installed base of over 300,000 safes in the US and Canada. The company
also has strong relationship with Walt Disney World Resort, Carlson
Hospitality, Interstate Hotels and Marriott Vacation Club. Safemark has
recorded revenue growth of nearly 14% since 1997.

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“American Capital’s flexible financing, long term investment perspective
and understanding of our business and future growth plans made them the
right choice for our investment partner,” said Safemark President and CEO
George Oelschig. “With the support of American Capital, Safemark can
continue to provide travelers peace of mind for the security of their
valued belongings.”

For more information about Safemark’s leading products and successful
revenue sharing program, go to
http://www.acas.com/news/press_releases/pr/pr.cfm?p_pr=pr20040702a.html

As of June 30, 2004, American Capital shareholders have enjoyed a total
return of 242% since the Company’s IPO—an annualized return of 20%,
assuming reinvestment of dividends. American Capital has declared a total
of $14.52 per share in dividends since its August 1997 IPO.

American Capital is a publicly traded buyout and mezzanine fund with
capital resources of approximately $3 billion. American Capital is an
investor in and sponsor of management and employee buyouts; invests in
private equity sponsored buyouts, and provides capital directly to private
and small public companies. American Capital provides senior debt,
mezzanine debt and equity to fund growth, acquisitions and
recapitalizations.
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