Practice Areas
Practice Areas

Small Business Investment Company (SBIC) Practice

Practice Leader: Michael B. Staebler

Pepper Hamilton has the country’s largest and most active Small Business Investment Company (SBIC) practice.

Pepper serves the SBIC industry in the following ways:

  • fund formation
  • assistance in licensing – more than 200 since 1994
  • regulatory advice to licensed Small Business Investment Companies
  • fund investment activities
  • serving as counsel to portfolio companies
  • provision of advice concerning systematic improvements to the SBIC Program.

Why Select Pepper?

It makes sense for you to select Pepper as your SBIC counsel for the following reasons:

  • Experience. Pepper's SBIC Practice Group is a core team of four attorneys and two skilled SBIC project managers with a combined total of more than 100 years of SBIC experience.

    The group is led by Michael B. Staebler (Detroit and Washington, D.C.). Mike served for six years as president and CEO of an SBIC located in Ann Arbor, Michigan (prior to its sale to NBD Bancorp (now JP Morgan Chase)) and has represented numerous SBICs and venture capital firms since 1972. He has authored several articles describing the formation and operation of SBICs, has served on the U.S. Small Business Administration (SBA)’s Advisory Counsel and has chaired the SBIC subcommittee of the American Bar Association.

    Other members of the group include Christopher Rossi (Berwyn, PA and New York); Michael A. Temple (Detroit); Janet L. Beyer and Sherri MacDonald (SBIC Project Managers - Detroit); Todd Betke and Tim McTaggart (Washington, D.C.); and Julia D. Corelli, Greg Nowak, Bradley Boericke, Joseph V. Del Raso and Lisa B. Petkun (Philadelphia).

    Mike Staebler has served as counsel to more than 225 licensed SBICs since 1972. He assisted the National Association of Small Business Investment Companies (NASBIC) in negotiating the SBA regulations implementing the “new” SBIC program from 1992-94 and has provided advice to SBA in connection with the creation of many of its forms and policies. Since 1994, he has helped more than 200 SBICs become licensed by the SBA. Chris Rossi is an experienced partnership, M&A and deal lawyer with more than five years of extensive SBIC experience. Mike Temple (11years) has intensive experience in connection with the formation, licensing, regulatory and investment activities of SBICs. Todd Betke is a skilled domestic and foreign investment funds formation attorney with extensive SBIC experience. They are supported by Jan Beyer and Sherri MacDonald who have multiple skills, including licensing documentation, leverage draw requests and SBA forms and procedures.

  • Knowledge. Establishing an SBIC requires extensive knowledge of partnership and corporate law, securities law, taxation (foreign and domestic) and ERISA laws, as well as in-depth knowledge of the SBIC Regulations. Lisa Petkun has provided SBIC tax advice for 30 years. Joe Del Raso, formerly an SEC attorney, and Greg Nowak advise hedge and other investment funds and have extensive expertise in the Investment Company Act of 1940 and experience with the Investment Advisers Act of 1940. Tim McTaggart and Brad Boericke have extensive experience in advising financial institutions about SBIC investment regulations. The firm has researched extensively the availability of Community Reinvestment Act credit for investments by financial institutions in SBICs as well as the interaction of state-sponsored economic development programs with SBIC requirements.

  • Working with Your Regular Counsel. The firm is equally happy to handle all aspects of your SBIC’s formation and licensing, or to work in conjunction with your regular counsel. Pepper has established excellent working relationships with many of the country’s other leading law firms and regularly receives referrals from them.

  • Cost-Effective. Having seen “almost all of it” before, the firm is equipped to provide informed, experienced advice to assist you in getting it right the first time.
Fund Formation

Pepper assists prospective SBICs in structuring their funds and raising private capital. The firm has a national perspective and extensive experience in negotiating relationships between principal fund managers and between fund sponsors and limited partners.

The firm regularly advises clients concerning all aspects of fund formation and management, including domestic and foreign tax structuring, ERISA and compliance with federal and state securities laws.


Pepper has represented more than 205 firms in obtaining licenses as SBICs or Specialized Small Business Investment Companies (SSBICs). Of these, more than 200 have received their licenses since August 1, 1994. In addition, the firm represents numerous management teams in the process of fund raising or obtaining a license. These firms are located throughout the United States, are structured as limited partnerships, corporations and limited liability companies, and have investors that include large public and private pension funds, state and local governmental agencies, banks and bank holding companies, tax-exempt entities, individuals and foreign individuals and entities.

Regulatory Advice

The firm provides ongoing regulatory advice to licensed SBICs covering the full range of SBA regulatory compliance.

Fund Investment Activities

Pepper regularly handles investments for SBICs, venture capital and private equity firms located throughout the United States. Our clients have invested at all stages of development of portfolio companies, including seed- and early-stage, growth, mezzanine and buyouts. Clients have invested across all industry sectors, including e-commerce, biotechnology, health, telecommunications, information technology, manufacturing, distribution, outsourcing, publishing and retail. Portfolio companies are both privately held and publicly traded. Several of our clients sponsor or have relationships with incubators/accelerators. Pepper has an extensive merger and acquisition practice and is accustomed to regularly representing buyout as well as venture capital investors.

Counsel to Portfolio Companies

We are experienced in all aspects of representing portfolio companies. We have helped companies grow from their initial incorporation and negotiation of their initial small contracts into large multi-national businesses. We advise growing businesses with respect to strategic alliances, technology licenses, incentive compensation plans, protection of intellectual property, personnel matters, securities compliance, relationships with suppliers and customers, banking and other financial relationships, and creditor rights matters. We have a large securities practice that handles public offerings on behalf of issuers and underwriters.

Support of the SBIC Industry

Pepper has been a member of the Small Business Investment Alliance (SBIA) since 1981, and has provided extensive support and counsel to the industry. Our lawyers have worked closely with SBIA and the SBA to assist in developing regulations and SBA policies implementing the “new” SBIC program in 1992 and to constantly improve the program. The firm has helped SBA develop several of its form documents and has helped SBIA prepare a number of its legislative and regulatory initiatives. The firm continues to provide advice and counsel to industry leaders as changes to the SBIC Program are discussed.

Pepper has sponsored and helped organize numerous seminars on the formation and operation of SBICs. Members of the firm are frequent speakers concerning the SBIC program at industry meetings and the SBIA Venture Capital Institute, as well as at gatherings of prospective investors, accountants, lawyers, development officials, venture capitalists and businesspeople. Our lawyers regularly meet with SBIA and SBA officials concerning industry policies and practices.

Interested in more information on SBICs? Read "Description of the Small Business Investment Company Debenture Program" and "Description of the Small Business Investment Company Early State SBIC Program."

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