Type of Security

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

 

Transaction Size

$3 – 12 million per company

 

Term

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

 

Current Yield

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

 

Granted Equity

Expect to receive granted equity or detachable warrants with a put option

 

Fees

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

 

Collateral

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

 

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

Investment Structure

We invest across the entire capital structure of a business, from senior debt to common equity. However, we require a meaningful current pay element in all investments, with most structured as subordinated debt or preferred equity. We tailor the structure of each investment to the needs and goals of each business.