It shall be a function of each small business investment company to provide a source of equity capital for incorporated and unincorporated small-business concerns, in such manner and under such terms as the small business investment company may fix in accordance with the regulations of the Administration.
Before any capital is provided to a small-business concern under this section—
(1) the company may require such concern to refinance any or all of its outstanding indebtedness so that the company is the only holder of any evidence of indebtedness of such concern; and
(2) except as provided in regulations issued by the Administration, such concern shall agree that it will not thereafter incur any indebtedness without first securing the approval of the company and giving the company the first opportunity to finance such indebtedness.
Equity capital provided to incorporated small business concerns under this section may be provided directly or in cooperation with other investors, incorporated or unincorporated, through agreements to participate on an immediate basis.
(Pub. L. 85–699, title III, §304, Aug. 21, 1958, 72 Stat. 693; Pub. L. 86–502, §6, June 11, 1960, 74 Stat. 196; Pub. L. 87–341, §5, Oct. 3, 1961, 75 Stat. 752; Pub. L. 90–104, title II, §206, Oct. 11, 1967, 81 Stat. 271; Pub. L. 92–595, §2(e), Oct. 27, 1972, 86 Stat. 1316.)
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Last modified: October 26, 2015