94 STAT. 2286
PUBLIC LAW 96-477—OCT. 21, 1980 "CAPITAL STRUCTURE
15 USC 80a-60. "SEC. 61. (a) Notwithstanding the exemption set forth in section Ante, p. 2277,15 6(f), Section 18 shall apply to a business development company to the use 80a-i8. same extent as if it were a registered closed-end investment company, except as follows: "(1) The asset coverage requirements of section 18(a)(1)(A) and (B) applicable to business development companies shall be 200 per centum. "(2) Notwithstanding section 18(c), a business development company may issue more than one class of senior security representing indebtedness if such business development company does not have outstanding any publicly held indebtedness, and all such securities of each class are— "(A) privately held or guaranteed by the Small Business Administration, or banks, insurance companies, or other institutional investors; and "(B) not intended to be publicly distributed. "(3) Notwithstanding section 18(d)— "(A) a business development company may issue senior securities representing indebtedness accompanied by warrants, options, or rights to subscribe or convert to voting securities of such company, if— "(i) such warrants, options, or rights expire by their terms within ten years; "(ii) such warrants, options, or rights are not separately transferable unless no class of such warrants, options, or rights and the senior securities accompanying them has been publicly distributed; "(iii) the exercise or conversion price is not less than the current market value at the date of issuance, or if no such market value exists, the current net asset value of such voting securities; and "(iv) the proposal to issue such securities is authorized by the shareholders or partners of such business development company, and such issuance is approved by the required majority (as defined in section 57(o)) of the directors of or general partners in such company on the basis that such issuance is in the best interests of such company and its shareholders or partners; and "(B) a business development company may issue, to its directors, officers, employees, and general partners, warrants, options, and rights to purchase voting securities of such company pursuant to an executive compensation plan, if— "(i)(I) in the case of warrants, options, or rights issued to any officer or employee of such business development company (including any officer or employee who is also a director of such company), such securities satisfy the conditions in clauses (i), (iii), and (iv) of subparagraph (A); or (II) in the case of warrants, options, or rights issued to any director of such business development company who is not also an officer or employee of such company, or to any general partner in such company, the proposal to issue such securities satisfies the conditions in clauses (i) and (iii) of subparagraph (A), is authorized by the shareholders or partners of such company, and is approved by order of the Commission,
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