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Investment Profile

C3 provides capital to lower middle market companies to support an acquisition, a recapitalization or for growth capital

Investment Criteria

Stage of Development

Established businesses with a history of profitability and sustainable cash flow. Will not invest in early-stage businesses or in turnarounds

Company Size

EBITDA of at least $2.0 million

Management

Must have a strong team with solid track record in place or already identified as part of an acquisition. Meaningful ownership stakes and appropriate incentives are critical

Investment Purpose

  • Growth Capital
  • Strategic Acquisitions
  • Ownership Transitions
  • Recapitalizations

Industry

Targeted industries include chemicals, consumer products, business services, distribution, and niche manufacturing. We do not invest in real estate, mineral exploration, financial institutions or businesses involving a significant bet on the evolution of specific technologies or with high risk of technological obsolescence

Geography

Located in the United States

Sponsorship

Will invest in unsponsored transactions. Will co-invest with other funds

Control

Generally do not seek a controlling interest

Investment Structure

Collateral

Generally a second security interest in collateral as part of a subordinated debt financing, subject to a subordination agreement with the senior lender

Fees

2-3% closing fee, plus out of pocket expenses

Granted Equity

Generally receive granted equity or detachable warrants with a put option

Current Yield

Typically 10-14% p.a. in interest or dividends

Term

Debt repayment generally within 5 years but will hold equity for longer periods

Transaction Size

$3-15 million per company

Type of Security

Preference for subordinated debt with granted equity, but will consider redeemable preferred equity where appropriate

Involvement

Board seat or observation rights to board meetings. Do not typically control or actively manage businesses in which we invest, but serve as strategic advisers and financial partners