RAND CAPITAL CORPORATION (NASDAQ:RAND) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01. Entry into Material Definitive Agreement.
On December 31, 2020, Rand Capital Corporation (the “Company”) entered into a new investment advisory and management agreement (the “New Advisory Agreement”) between the Company and Rand Capital Management, LLC (the “Adviser”), in connection with the acquisition by Callodine Group, LLC (“Callodine”) of the controlling interest in the Adviser from East Asset Management, LLC (the “Adviser Change in Control”). The New Advisory Agreement replaces the prior investment advisory and management agreement entered into with the Adviser on November 8, 2019 (the “Prior Investment Advisory Agreement”). to the terms of the New Advisory Agreement, the Adviser will remain the external investment adviser to the Company. All terms of the New Advisory Agreement remain unchanged from the terms of the Prior Investment Advisory Agreement. The New Advisory Agreement is further described in the Company’s Proxy Statement as filed with the Securities and Exchange Commission on November 13, 2020.
The Company’s board of directors (the “Board”), including all of the “non-interested” (i.e., independent) directors, unanimously approved the New Advisory Agreement at a meeting of the Board held on October 29, 2020. The Company’s shareholders approved the Company’s entry into the New Advisory Agreement at a special meeting of the shareholders held on December 16, 2020.
In addition, upon the consummation of the Adviser Change in Control, the Company entered into a new administration agreement (the “New Administration Agreement”) between the Company and the Adviser. The New Administration Agreement replaces the prior administration agreement entered into with the Adviser on November 8, 2019 (the “Prior Administration Agreement”). to the terms of the New Advisory Agreement, the Adviser will remain the administrator to the Company. All the terms of the New Administration Agreement remain unchanged from the terms of the Prior Administration Agreement.
In connection with the Adviser Change in Control, the investment committee of the Adviser was expanded to add James Morrow, Chief Executive Officer of Callodine. The Adviser’s investment committee now includes Mr. Morrow, Brian Collins, Scott Barfield, Adam Gusky, Allen F. Grum and Daniel P. Penberthy. The approval of any investment decision for the Company (including, for the avoidance of doubt, any follow-on investment, amendment, waiver or sale of such investment) requires majority approval of all members then-serving on the investment committee of the Adviser.
The foregoing descriptions of the New Advisory Agreement and the New Administration Agreement are qualified in their entirety by the terms of the New Advisory Agreement, dated December 31, 2020, attached hereto as Exhibit 10.1 and the terms of the New Administration Agreement, dated December 31, 2020, attached hereto as Exhibit 10.2.
Item 1.02. Termination of a Material Definitive Agreement.
The information set forth under Item 1.01 above is incorporated herein by reference.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
| 10.1 | Investment Advisory and Management Agreement, dated as of December 31, 2020, between Rand Capital Corporation and Rand Capital Management LLC. |
| 10.2 | Administration Agreement, dated as of December 31, 2020, between Rand Capital Corporation and Rand Capital Management LLC. |
RAND CAPITAL CORP Exhibit
EX-10.1 2 ex10-1.htm Exhibit 10.1 INVESTMENT ADVISORY AND MANAGEMENT AGREEMENT BETWEEN RAND CAPITAL CORPORATION AND RAND CAPITAL MANAGEMENT LLC Agreement made this 31st day of December,…
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About RAND CAPITAL CORPORATION (NASDAQ:RAND)
Rand Capital Corporation is a closed-end, diversified, management investment company. The Company provides managerial assistance to the portfolio companies in which it invests. The Company makes venture capital investments in early or expansion-stage companies, typically in New York and its surrounding states. The Company makes the majority of its investments through its subsidiary, Rand Capital SBIC, Inc. (Rand SBIC), which operates as a small business investment company. The Company invests in a mixture of debt and equity instruments. The debt securities have an equity component in the form of warrants or options to acquire stock or the right to convert the debt securities into stock. The Company’s principal investment objective is to achieve long-term capital appreciation on its equity investments while maintaining a cash flow from the debenture and pass-through equity instruments. It makes initial investments in a company through equity or in debt or loan instruments.
