,,ib ,union ,calendar ,no4 #chh #aadth ,,congress #b;d ,session ,h4 ,r4 #chfh ,report ,no4 #aad-ejh ,,in ,,the ,,house ,,of ,,representatives ,november #b1 #bjae ,mr4 ,mulvaney introduced the following bill2 which was referred to the ,committee on ,financial ,services ,april #ai1 #bjaf ,additional sponsors3 ,mr4 ,stivers1 ,mr4 ,sherman1 ,mr4 ,schweikert1 ,mr4 ,pittenger1 ,mr4 ,kildee1 and ,mr4 ,dold ,april #ai1 #bjaf ,reported with an amendment1 committed to the ,committee of the ,whole ,house on the ,state of the ,union1 and ordered to be printed ,strike out all after the enacting clause and insert the part printed in italic ,for text of introduced bill1 see copy of bill as introduced on ,november #b1 #bjae ,a ,,bill ,to amend the ,investment ,company ,act of #aidj to remove certain restrictions on the ability of business development companies to own securities of investment advisers and certain financial companies1 to change certain requirements relating to the capital structure of business development companies1 to direct the ,securities and ,exchange ,commission to revise certain rules relating to business development companies1 and for other purposes4 #a4 ,short title ,this ,act may be cited as the ,small ,business ,credit ,availability ,act4 #b4 ,business development company ownership of securities of investment advisers and certain financial companies 7a7 ,in general 7#a7 ,in general ,not later than #a year after the date of enactment of this ,act1 the ,securities and ,exchange ,commission shall promulgate regulations to codify the order in ,investment ,company ,act ,release ,no4 #cjjbd1 dated ,march #cj1 #bjab4 ,if the ,commission fails to complete the regulations as required by this subsection1 a business development company shall be entitled to treat such regulations as having been completed in accordance with the actions required to be taken by the ,commission until such time as such regulations are completed by the ,commission4 7#b7 ,rule of construction ,nothing in this subsection shall prevent the ,commission from issuing rules to address potential conflicts of interest between business development companies and investment advisers4 7b7 ,permissible assets of an eligible portfolio company ,section #ee of the ,investment ,company ,act of #aidj 7#ae ,u4,s4,c4 #hj;a-#ed7 is amended by adding at the end the following3 7c7 ,securities deemed ,to be permissible assets ,notwithstanding subsection 7a71 securities that would be described in paragraphs 7#a7 through 7#f7 of such subsection except that the issuer is a company described in paragraph 7#b71 7#c71 7#d71 7#e71 7#f71 or 7#i7 of section #c7;c7 may be deemed to be assets described in paragraphs 7#a7 through 7#f7 of subsection 7a7 to the extent necessary for the sum of the assets to equal #gj percent of the value of a business development company's total assets 7other than assets described in paragraph 7#g7 of subsection 7a771 provided that the aggregate value of such securities counting toward such #gj percent shall not exceed #bj percent of the value of the business development company's total assets4 4 #c4 ,expanding access to capital for business development companies 7a7 ,in general ,section #fa7;a7 of the ,investment ,company ,act of #aidj 7#ae ,u4,s4,c4 #hj;a-#fj7;a77 is amended-- 7#a7 by redesignating paragraphs 7#b7 through 7#d7 as paragraphs 7#c7 through 7#e71 respectively2 7#b7 by striking paragraph 7#a7 and inserting the following3 7#a7 ,except as provided in paragraph 7#b71 the asset coverage requirements of subparagraphs 7,a7 and 7,b7 of section #ah7;a77#a7 7and any related rule promulgated under this ,act7 applicable to business development companies shall be #bjj percent4 7#b7 ,the asset coverage requirements of subparagraphs 7,a7 and 7,b7 of section #ah7;a77#a7 and of subparagraphs 7,a7 and 7,b7 of section #ah7;a77#b7 7and any related rule promulgated under this ,act7 applicable to a business development company shall be #aej percent if-- 7,a7 within five business days of the approval of the adoption of the asset coverage requirements described in clause 7ii71 the business development company discloses such approval and the date of its effectiveness in a ,form #h-,k filed with the ,commission and in a notice on its website and discloses in its periodic filings made under section #ac of the ,securities ,exchange ,act of #aicd 7#ae ,u4,s4,c4 #ghm7-- 7i7 the aggregate value of the senior securities issued by such company and the asset coverage percentage as of the date of such company's most recent financial statements2 and 7ii7 that such company has adopted the asset coverage requirements of this subparagraph and the effective date of such requirements2 7,b7 with respect to a business development company that issues equity securities that are registered on a national securities exchange1 the periodic filings of the company under section #ac7;a7 of the ,securities ,exchange ,act of #aicd 7#ae ,u4,s4,c4 #ghm7 include disclosures reasonably designed to ensure that shareholders are informed of-- 7i7 the amount of indebtedness and asset coverage ratio of the company1 determined as of the date of the financial statements of the company dated on or most recently before the date of such filing2 and 7ii7 the principal risk factors associated with such indebtedness1 to the extent such risk is incurred by the company2 and 7,c7 7i7 the application of this paragraph to the company is approved by the required majority 7as defined in section #eg7o77 of the directors of or general partners of such company who are not interested persons of the business development company1 which application shall become effective on the date that is #a year after the date of the approval1 and1 with respect to a business development company that issues equity securities that are not registered on a national securities exchange1 the company extends1 to each person who is a shareholder as of the date of the approval1 an offer to repurchase the equity securities held by such person as of such approval date1 with #be percent of such securities to be repurchased in each of the four quarters following such approval date2 or 7ii7 the company obtains1 at a special or annual meeting of shareholders or partners at which a quorum is present1 the approval of more than #ej percent of the votes cast of the application of this paragraph to the company1 which application shall become effective on the date immediately after the date of the approval4 2 7#c7 in paragraph 7#c7 7as redesignated71 by inserting or which is a stock1 provided that all such stock is issued in accordance with paragraph 7#f7 after indebtedness2 7#d7 in subparagraph 7,a7 of paragraph 7#d7 7as redesignated7-- 7,a7 in the matter preceding clause 7i71 by striking voting2 and 7,b7 by amending clause 7iii7 to read as follows3 7iii7 the exercise or conversion price at the date of issuance of such warrants1 options1 or rights is not less than-- 7,i7 the market value of the securities issuable upon the exercise of such warrants1 options1 or rights at the date of issuance of such warrants1 options1 or rights2 or 7,,ii7 if no such market value exists1 the net asset value of the securities issuable upon the exercise of such warrants1 options1 or rights at the date of issuance of such warrants1 options1 or rights2 and 2 and 7#e7 by adding at the end the following3 7#f7 7,a7 ,qualified institutional buyer ,except as provided in subparagraph 7,b71 the following shall not apply to a senior security which is a stock and which is issued to and held by a qualified institutional buyer 7as defined in section #c7;a77#fd7 of the ,securities ,exchange ,act of #aicd73 7i7 ,subparagraphs 7,c7 and 7,d7 of section #ah7;a77#b74 7ii7 ,subparagraph 7,e7 of section #ah7;a77#b71 to the extent such subparagraph requires any priority over any other class of stock as to distribution of assets upon liquidation4 7iii7 ,with respect to a senior security which is a stock1 subsections 7c7 and 7i7 of section #ah4 7,b7 ,individual investors who are not qualified institutional buyers ,subparagraph 7,a7 shall not apply with respect to a senior security which is a stock and which is issued to a person who is not known by the business development company to be a qualified institutional buyer 7as defined in section #c7;a7 of the ,securities ,exchange ,act of #aicd74 7#g7 ,rule of construction ,notwithstanding any other provision of law1 any additional class of stock issued pursuant to this section must be issued in accordance with all investor protections contained in all applicable federal securities laws administered by the ,commission4 4 7b7 ,conforming amendments ,the ,investment ,company ,act of #aidj 7#ae ,u4,s4,c4 #hj;a-#a et seq47 is amended-- 7#a7 in section #eg-- 7,a7 in subsection 7j77#a71 by striking section #fa7;a77#c77;,b7 and inserting section #fa7;a77#d77;,b72 and 7,b7 in subsection 7n77#b71 by striking section #fa7;a77#c77;,b7 and inserting section #fa7;a77#d77;,b72 and 7#b7 in section #fc7c71 by striking section #fa7;a77#c7 and inserting section #fa7;a77#d74 #d4 ,parity for business development companies regarding offering and proxy rules 7a7 ,revision to rules ,not later than #a year after the date of enactment of this ,act1 the ,securities and ,exchange ,commission shall revise any rules to the extent necessary to allow a business development company that has filed an election pursuant to section #ed of the ,investment ,company ,act of #aidj 7#ae ,u4,s4,c4 #hj;a-#ec7 to use the securities offering and proxy rules that are available to other issuers that are required to file reports under section #ac or section #ae7;d7 of the ,securities ,exchange ,act of #aicd 7#ae ,u4,s4,c4 #ghm2 #gho7d774 ,any action that the ,commission takes pursuant to this subsection shall include the following3 7#a7 ,the ,commission shall revise rule #dje under the ,securities ,act of #aicc 7#ag ,c4,f4,r4 #bcj4dje7-- 7,a7 to remove the exclusion of a business development company from the definition of a well-known seasoned issuer provided by that rule2 and 7,b7 to add registration statements filed on ,form ,n-#b to the definition of automatic shelf registration statement provided by that rule4 7#b7 ,the ,commission shall revise rules #afh and #afi under the ,securities ,act of #aicc 7#ag ,c4,f4,r4 #bcj4afh and #bcj4afi7 to remove the exclusion of a business development company from an issuer that can use the exemptions provided by those rules4 7#c7 ,the ,commission shall revise rules #afc and #afc;,a under the ,securities ,act of #aicc 7#ag ,c4,f4,r4 #bcj4afc and #bcj4afc;,a7 to remove a business development company from the list of issuers that are ineligible to use the exemptions provided by those rules4 7#d7 ,the ,commission shall revise rule #acd under the ,securities ,act of #aicc 7#ag ,c4,f4,r4 #bcj4acd7 to remove the exclusion of a business development company from that rule4 7#e7 ,the ,commission shall revise rules #ach and #aci under the ,securities ,act of #aicc 7#ag ,c4,f4,r4 #bcj4ach and #bcj4aci7 to specifically include a business development company as an issuer to which those rules apply4 7#f7 ,the ,commission shall revise rule #afd under the ,securities ,act of #aicc 7#ag ,c4,f4,r4 #bcj4afd7 to remove a business development company from the list of issuers that are excluded from that rule4 7#g7 ,the ,commission shall revise rule #dcc under the ,securities ,act of #aicc 7#ag ,c4,f4,r4 #bcj4dcc7 to specifically include a business development company that is a well-known seasoned issuer as an issuer to which that rule applies4 7#h7 ,the ,commission shall revise rule #dae under the ,securities ,act of #aicc 7#ag ,c4,f4,r4 #bcj4dae7-- 7,a7 to state that the registration for securities provided by that rule includes securities registered by a business development company on ,form ,n-#b2 and 7,b7 to provide an exception for a business development company from the requirement that a ,form ,n-#b registrant must furnish the undertakings required by item #cd4d of ,form ,n-#b4 7#i7 ,the ,commission shall revise rule #dig under the ,securities ,act of #aicc 7#ag ,c4,f4,r4 #bcj4dig7 to include a process for a business development company to file a form of prospectus that is parallel to the process for filing a form of prospectus under rule #dbd7;b74 7#aj7 ,the ,commission shall revise rules #agb and #agc under the ,securities ,act of #aicc 7#ag ,c4,f4,r4 #bcj4agb and #bcj4agc7 to remove the exclusion of an offering of a business development company from those rules4 7#aa7 ,the ,commission shall revise rule #dah under the ,securities ,act of #aicc 7#ag ,c4,f4,r4 #bcj4dah7 to provide that a business development company that would otherwise meet the eligibility requirements of ,general ,instruction ,i4,a of ,form ,s-#c shall be exempt from paragraph 7a77#c7 of that rule4 7#ab7 ,the ,commission shall revise rule #ad;a-#aja under the ,securities ,exchange ,act of #aicd 7#ag ,c4,f4,r4 #bdj4ad;a-#aja7 to provide that a business development company that would otherwise meet the requirements of ,general ,instruction ,i4,a of ,form ,s-#c shall be deemed to meet the requirements of ,form ,s-#c for purposes of ,schedule #ad;,a4 7#ac7 ,the ,commission shall revise rule #ajc under ,regulation ,,fd 7#ag ,c4,f4,r4 #bdc4ajc7 to provide that paragraph 7a7 of that rule applies for purposes of ,form ,n-#b4 7b7 ,revision to form ,n-#b ,not later than #a year after the date of enactment of this ,act1 the ,commission shall revise ,form ,n-#b-- 7#a7 to include an item or instruction that is similar to item #ab on ,form ,s-#c to provide that a business development company that would otherwise meet the requirements of ,form ,s-#c shall incorporate by reference its reports and documents filed under the ,securities ,exchange ,act of #aicd into its registration statement filed on ,form ,n-#b2 and 7#b7 to include an item or instruction that is similar to the instruction regarding automatic shelf offerings by well-known seasoned issuers on ,form ,s-#c to provide that a business development company that is a well-known seasoned issuer may file automatic shelf offerings on ,form ,n-#b4 7c7 ,treatment if revisions not completed in timely manner ,if the ,commission fails to complete the revisions required by subsections 7a7 and 7b7 by the time required by such subsections1 a business development company shall be entitled to treat such revisions as having been completed in accordance with the actions required to be taken by the ,commission by such subsections until such time as such revisions are completed by the ,commission4 7d7 ,rule of construction ,any reference in this section to a rule or form means such rule or form or any successor rule or form4 ,april #ai1 #bjaf ,reported with an amendment1 committed to the ,committee of the ,whole ,house on the ,state of the ,union1 and ordered to be printed