Jenner & Block

Client Alert: Important Deadline for SBICs with Outstanding Approval Notices in March

When a Small Business Investment Company (an SBIC) files a request for a draw against a Leverage Commitment with the Small Business Administration (SBA), the SBIC receives an Approval Notice from the SBA stating that the SBIC must complete Section II of the SBIC Approval Notice and fax the entire document to BNY Mellon when it wishes to draw down the leverage. The date that such Approval Notice is filed with BNY Melon determines with which debenture pool the applicable debenture will be placed, and the pooling sets the interest rate for such debentures for their entire ten-year term.

Currently outstanding Approval Notices must be filed no later than March 13, 2017 (2PM EST) in order to receive funding of the debentures on March 14, 2017 and to lock in the interest rate that will be set for the six-month pooling ending on March 29, 2017. Any outstanding Approval Notices submitted after that time will have their interest rates set by the pooling in September 2017.

On currently outstanding Approval Notices, the Scheduled Pooling Date information is stated as follows: Scheduled Pooling DateMarch 29, 2017 if Settlement Date is on or before March 14, 2017, and September 20, 2017 if Settlement Date is after March 14, 2017.