Transcription of Frequently Asked Questions About Business Development ...
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Morrison & Foerster LLP Capital MarketsFREQUENTLY Asked QUESTIONSABOUT BUSINESSDEVELOPMENT COMPANIES understanding Business Development CompaniesWhat is a Business Development company ? Business Development companies ( BDCs ) are special investment vehicles designed to facilitate capital formation for small and middle-market companies. BDCs are closed-end investment companies; however, BDCs are exempt from many of the regulatory constraints imposed by the Investment Company Act of 1940, as amended (the 1940 Act ), and the rules thereunder. Section 2(a)(48) of the 1940 Act defines Business Development company to mean a domestic closed-end company that (1) operates for the purpose of making investments in certain securities specified in Section 55(a) of the 1940 Act and, with limited exceptions, makes available
FREQUENTLY ASKED QUESTIONS ABOUT BUSINESS DEVELOPMENT COMPANIES ... investments (no single investment can account for more than 25% of total holdings); (3) are required by the 1940 Act to distribute a minimum of 90% of their ... structure and the master fund proposed to form one
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