0000000000-05-009719.txt : 20120828
0000000000-05-009719.hdr.sgml : 20120828
20050301163643
ACCESSION NUMBER: 0000000000-05-009719
CONFORMED SUBMISSION TYPE: UPLOAD
PUBLIC DOCUMENT COUNT: 1
FILED AS OF DATE: 20050301
FILED FOR:
COMPANY DATA:
COMPANY CONFORMED NAME: TICC Capital Corp.
CENTRAL INDEX KEY: 0001259429
IRS NUMBER: 200118736
STATE OF INCORPORATION: MD
FISCAL YEAR END: 1231
FILING VALUES:
FORM TYPE: UPLOAD
BUSINESS ADDRESS:
STREET 1: 8 SOUND SHORE DR
STREET 2: SUITE 255
CITY: GREENWICH
STATE: CT
ZIP: 06830
BUSINESS PHONE: 2039835275
MAIL ADDRESS:
STREET 1: 8 SOUND SHORE DRIVE
STREET 2: SUITE 255
CITY: GREENWICH
STATE: CT
ZIP: 06830
FORMER COMPANY:
FORMER CONFORMED NAME: TECHNOLOGY INVESTMENT CAPITAL CORP
DATE OF NAME CHANGE: 20030812
LETTER
1
filename1.txt
November 18, 2004
Cynthia Krus, Esq.
Sutherland Asbill & Brennan LLP
1275 Pennsylvania Avenue, N.W.
Washington, DC 20004
Re: Technology Investment Capital Corp.
File Nos. 333-119879 and 814-638
Dear Ms. Krus:
We have reviewed the registration statement on Form N-2 for
the
Technology Investment Capital Corp. ("Fund") filed with the
Commission on October 21, 2004. We have reviewed the registration
statement and have the following comments.
Prospectus
Cover
Please delete the words "Except where the context suggests
otherwise" from the definition of the terms "we," "us," "our" and
"Technology Investment Capital Corp." Throughout the document,
please use defined terms consistently. Please clearly distinguish
the Fund and Investment Adviser throughout the document.
Please disclose that an investment in the Fund presents a
heightened risk of total loss of investment and make prominent the
disclosure that the companies in which the Fund invests are
subject
to special risks. See Item 1.1.j. of Form N-2.
Please place the disclosure relating to the overallotment in
the pricing table or a note to it. See Instruction 4 to Item
1.1.g.
of Form N-2.
The filing currently does not disclose the ratio of the
rights
offering. Please note, when the information is completed, that
the
ratio of the offering may not exceed one new share for each three
rights held. See Association of Publicly Traded Investment Funds
(pub. avail. Aug. 2, 1985).
Please advise whether the NASD has reviewed and approved the
terms of the underwriting agreement.
Summary
Purpose of the Offer
The disclosure in this section does not disclose how the
rights
offering would be
"in the best interests of the shareholders." Please explain
clearly
why the rights offering is in shareholders` best interests.
Please
disclose prominently in this section that the Fund has yet to
invest
approximately $50 million of the proceeds of the initial offering.
Also disclose how the Adviser and the dealer manager will benefit
monetarily from the rights offering. Please disclose why the Fund
wishes to increase its equity capital when it has yet to invest a
large percentage of its existing capital.
Please revise this disclosure to state that there is no
assurance that the offering will be successful, or that by
increasing
the size of the Fund, the Fund`s aggregate expenses, and
correspondingly, its expense ratio, will be lowered. Please make
corresponding revisions throughout the registration statement.
Sale of Rights
Have the rights been registered under the Securities Exchange
Act of 1934?
Business
Disclosure in this section indicates the Fund provides
capital
to "technology-related companies," defined there as businesses
that
"focus on" certain specified industries. Since the word
"technology"
is not modified by "related" in the name of the Fund, please
clarify
that the Fund invests in "technology" companies, rather than
"technology-related` companies. Also, please disclose that
"technology" companies are companies that derive at least 50% of
their revenues or profits from goods produced or sold, investments
made, or services performed in the technology industry or have at
least 50% of their assets in the technology industry. Please
advise
supplementally whether the Fund`s portfolio currently meets this
requirement.
Please add disclosure identifying the types of securities in
which the Fund will invest outside of the 70% required to be
invested
in qualifying investments. Please note that any investment in
nonqualifying assets must be supported by disclosure that
reconciles
the nonqualifying investment with the purpose of the Fund.
Since the Fund has an incentive fee under Section 205(b)(3)
of
the Advisers Act and seemingly intends to use the 30% basket for
nonqualifying assets, please disclose that the advisor will
receive
incentive compensation based on the performance of the
nonqualifying
assets as well as the 70% of qualifying assets.
Fees and Expenses
Please delete the words "borne by us" from the Offering
Expenses
line item.
Please confirm that the dealer manager fees referenced in
note 1
to the fee table are included in the sales load figure shown in
the
fee table.
Please delete the word "Estimated" from the line in the fee
table currently worded "Estimated annual expenses."
Please include percentage equivalents for all fees and
expenses
currently disclosed in dollar amounts.
Disclosure in note 4 to the fee table indicates that Fund
shareholders approved an increase in the Adviser`s compensation
rate
from two percent of net assets to two percent of gross assets, yet
the fee table still discloses the previous rate. Please correct
this
inconsistency.
Risk Factors
Our business model depends upon the development of strong referral
relationships with private equity and venture capital funds and
investment banking firms.
Please delete the first two sentences of this paragraph, as they
do
not discuss risk.
We may not realize gains from our equity investments
Please delete the second and third sentences of this
paragraph,
as they do not discuss risk.
Senior securities and other indebtedness
Make clear throughout the disclosure that the Fund`s common
shareholders will bear the risks and expenses of the issuance of
senior securities, and disclose fully in this section all such
risks
and expenses.
Many of our portfolio investments will be recorded at fair value
as
determined in good faith by our board of directors and, as a
result,
there will be uncertainty as to the value of our portfolio
investments
Who will value the Fund`s portfolio investments? If the
Adviser
will, then do not refer to the Adviser as "we" in the disclosure.
Also, disclose here the Adviser`s conflict of interest with
respect
to valuation, i.e., that the Adviser can increase its fee income
by
inflating the value of the Fund`s investments.
There are significant potential conflicts of interest, which could
impact our investment returns
The first paragraph states that the Fund`s executive
officers,
directors and management of the Investment Adviser may have
obligations to investors in other entities, including related
entities, the fulfillment of which might not be in the best
interests
of the Fund`s stockholders. Please disclose how the conflict of
interest will affect the Fund`s performance and how any such
conflicts will be resolved.
Our incentive fee may induce TIM to make speculative investments
How will the Board protect the Fund from the Adviser`s
tendency
to make speculative investments?
Forward-Looking Statements
This section attempts to limit liability for forward-looking
statements. Please delete or substantially revise this section.
Statements relating to investment companies (including business
development companies) and statements made in connection with
initial
public offerings are excluded from the safe harbor for forward-
looking statements. See Section 21E(b)(2)(B) & (D) of the
Securities
Exchange Act of 1934. Also, please do not use only capital
letters
in this disclosure.
Management`s Discussion and Analysis of Financial Condition and
Results of Operation
In the table of the Fund`s investments, please disclose the
maturity date and interest rate of each note listed.
Management Fee
You have provided examples explaining how the incentive fee
will be calculated. Please supplementally inform us whether the
Fund
intends to provide similar explanations in its periodic reports of
the calculation of the incentive fees actually paid.
Please disclose here and in the discussion of risks that the
realization of deferred loan interest may require the Fund to
liquidate assets to pay advisory fees and distributions to
shareholders. Also, clarify whether the Adviser is required to
reimburse the Fund for fees that were based on income accrued on
deferred interest obligations where the obligor subsequently
defaults.
Please clarify whether pre-incentive fee net investment
income
includes unrealized capital gains and losses.
Qualifying Assets
In this section, you discuss what investments constitute
qualifying assets under the Investment Company Act. Under Section
2(a)(46) of the Investment Company Act, a BDC may acquire
securities
of any domestic company or any non-investment
company, or a company excluded from the definition of investment
company that satisfies one of the following:
(i) it does not have a class of securities that may be margined by
a
broker or dealer;
(ii) it is controlled by the BDC, as described in the applicable
subsection; or,
(iii) it has total assets of not more than $4,000,000 and
shareholder
equity of not less than $2,000,000.
The Federal Reserve Board amended Regulation T to permit
brokers
and dealers to extend credit with respect to any non-equity
security.
The provision is not limited by the amount of value involved.
Because broker/dealers may now margin non-equity securities, it
appears that the number of companies in which a BDC may invest
under
(i) above has significantly decreased.
Accordingly, please provide us with the following
information:
1. What are your views regarding the applicability of amended
Regulation T, i.e., how do you analyze the impact of this change;
and,
2. In light of the change and its impact on Section 2(a)(46), what
types of securities are now eligible and available to the company
under your interpretation of Section 2(a)(46).
Dividend Reinvestment Plan
The fourth paragraph states that the dividend reinvestment
plan
will use primarily newly issued shares to implement the plan and
that
these shares will be issued at the market price per share.
Section
23(b) of the Investment Company Act provides that closed-end funds
may not issue shares below net asset value. Please explain to us
how
the Fund will issue shares to stockholders if the market price is
below the Fund`s net asset value. See Section 23(b) of the
Investment Company Act.
Control Share Acquisitions
The first sentence of the fourth paragraph states that, if
the
voting rights are not
approved or the acquiring person does not deliver an acquiring
person
statement, then the corporation may repurchase for fair value any
or
all of the control shares, except those for which voting rights
have
been previously approved. Please explain how this provision is
consistent with Section 23(c) of the Investment Company Act.
Closing
We note that portions of the filing are incomplete. We may
have
additional comments on such portions when you complete them in a
pre-
effective amendment, on disclosures made in response to this
letter,
on information supplied supplementally, or on exhibits added in
any
pre-effective amendments. Please note that comments we give in
one
section apply to other sections in the filing that contain the
same
or similar disclosure.
Please advise us if you have submitted or expect to submit
an
exemptive application or no-action request in connection with your
registration statement.
Response to this letter should be in the form of a pre-
effective amendment filed pursuant to Rule 472 under the
Securities
Act. Where no change will be made in the filing in response to a
comment, please indicate this fact in a supplemental letter and
briefly state the basis for your position.
We urge all persons who are responsible for the accuracy and
adequacy of the disclosure in the filings reviewed by the staff to
be
certain that they have provided all information investors require
for
an informed decision. Since the Fund and its management are in
possession of all facts relating to the Fund`s disclosure, they
are
responsible for the accuracy and adequacy of the disclosures they
have made.
Notwithstanding our comments, in the event the Fund requests
acceleration of the effective date of the pending registration
statement, it should furnish a letter, at the time of such
request,
acknowledging that
* should the Commission or the staff, acting pursuant to delegated
authority, declare the filing effective, it does not foreclose the
Commission from taking any action with respect to the filing;
* the action of the Commission or the staff, acting pursuant to
delegated authority, in declaring the filing effective, does not
relieve the Fund from its full responsibility for the adequacy and
accuracy of the disclosure in the filing; and
* the Fund may not assert this action as defense in any proceeding
initiated by the Commission or any person under the federal
securities laws of the United States.
In addition, please be advised that the Division of
Enforcement
has access to all information you provide to the staff of the
Division of Investment Management in connection with our review of
your filing or in response to our comments on your filing.
We will consider a written request for acceleration of the
effective date of the registration statement as a confirmation of
the
fact that those requesting acceleration are aware of their
respective
responsibilities. We will act on the request and, pursuant to
delegated authority, grant acceleration of the effective date.
If you have any questions prior to filing a pre-effective
amendment, please call me at (202) 942-0686.
Sincerely,
Vincent J. Di Stefano
Senior Counsel
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