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Business Profile
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Corporate Structure
Patriot Capital Funding, Inc. is a closed-end, non-diversified,
internally managed investment company that has elected to be treated
as a business development company (“BDC”) under the 1940 Act.
Following the filing of our 2006 tax return, we
intend to elect to be treated for
federal income tax purposes as a regulated investment company (“RIC”)
under Subchapter M of the Internal Revenue Code. This election
will be effective as of August 2005. As a RIC, we
generally will not have to pay corporate-level federal income taxes
on any net ordinary income or capital gains that we distribute to
our stockholders as dividends if we meet certain source-of-income
and asset diversification requirements.
Products
Our products include revolving loans, acquisition lines of
credit, senior secured term loans, junior secured term loans,
delayed draw term loans, subordinated loans and equity
co-investments. Our ability to invest across a company’s capital
structure allows us to offer companies a comprehensive suite of
financing solutions, including “one-stop” financing. |
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Target Market
We primarily finance privately-held companies in
transactions initiated by private equity sponsors. We
generally target the sponsors of private equity funds
with less than $250 million in assets that are focused
on making investments in companies with $10 million to
$100 million in annual revenues. Over the past five
years, there were approximately 400 private equity funds
that each raised less than $250 million.
We take a generalist investing approach, seeking
manufacturers, distributors and service providers that
meet our investment criteria.
Target Investment Size
Debt investments – $3 million to $20 million
Equity co-investments – Generally up to $2 million
Investment Objective
Our investment objective is to generate both current cash income
and capital appreciation. To accomplish this objective, we seek to
provide our stockholders with current income primarily from the
interest on our debt investments and related origination fees, and
to enable our stockholders to participate in the capital
appreciation and potential long-term growth of our portfolio
companies through warrants and other equity interests that we
acquire.
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