Capital Southwest Subsidiary Files Registration Statement With SEC to Effect Spin-Off

Capital Southwest Corporation

("Capital Southwest") today announced that its wholly-owned subsidiary, CSW Industrials, Inc. ("CSWI"), has filed a registration statement with the Securities and Exchange Commission in connection with the proposed spin-off of Capital Southwest's industrial products, coatings, sealants and adhesives and specialty chemicals businesses into a standalone, publicly traded company. Following the spin-off, Capital Southwest will continue as a business development company refocused on a lending strategy more appropriate for its corporate and regulatory structure. "The filing of the registration statement is an important step in our plan to establish CSWI as a separately traded public entity," said Joseph B. Armes, Capital Southwest's Chairman and Chief Executive Officer, who, following the spin-off will be the Chairman and Chief Executive Officer of CSWI. "We are confident that establishing these two highly focused companies, each with its optimal corporate structure, will allow our shareholders to more fully benefit from the compelling value creation opportunities associated with each business." The spin-off will be effected by a distribution of CSWI shares on a pro rata basis to the shareholders of Capital Southwest as a special dividend. The registration statement includes a preliminary Information Statement about the terms and conditions of the spin-off, as well as important information about CSWI as a standalone business, including CSWI's financial information and operating and growth strategies. Shareholders who want more information regarding the spin-off of CSWI, including the potential benefits and risks associated with the transaction, should review the registration statement, which is available on the SEC's website at www.sec.gov. The completion of the spin-off is subject to a number of conditions including the receipt of a favorable opinion with respect to the tax-free nature of the transaction for federal income tax purposes and final approval by the Capital Southwest board of directors. The spin-off is not subject to a Capital Southwest shareholder vote.