INVESTMENT STRATEGY

Accel-KKR engages primarily in the following four types of transactions:

Acquisitions and recapitalizations of private companies. We pursue investments in private companies that prefer to remain private or do not currently have the scale and/or growth profile to access the public markets, but whose shareholders desire liquidity and/or access to growth capital, including acquisition financing. These companies often will not have venture or traditional institutional investors, and will often include founder and family owned businesses.

Acquisitions of divisional or subsidiary assets. Accel-KKR seeks to acquire subsidiaries, business units or operating assets of existing companies. Specifically, we target assets that are considered, or are likely to be considered, non-core assets. These will typically include businesses with business models that are inconsistent and/or incompatible with the parent and may have been underinvested in for some period.

Going-private transactions involving small/micro-cap public companies. Accel-KKR pursues going-private transactions in public companies that are either subscale for the public markets or whose management teams have a business plan that is most appropriately executed as a private company. We generally seek to work with existing management teams to affect a management-supported buyout. Accel-KKR will also pursue opportunities to acquire companies in need of meaningful organizational and/or operational change.

Structured minority equity and debt investments. Accel-KKR has a unique abillty to deliver business owners highly flexible capital in the form of a structured minority investment. We are able to start first with the business owner's objectives for raising capital, including shareholder liquidity, acquisition financing, expansion capital and capital structure restructuring (or clean-up). Once the key objectives are agreed upon with a business owner or management team, we are able to structure investments with characteristics optimal for that specific business by using structured equity, debt or a hybrid/combination of the two. These investments are structured to meet the business owner’s primary objectives (addressing both operating and capital structure needs); our intent is to be a long-term partner and to assist in value building similar to our approach with our control investments, though we generally expect to be a minority investor over the life of our investment.