RECENT HISTORY AND DEVELOPMENTS

Prior to November 1, 1999, we were a closed-end management investment company, which was regulated as a business development company under the Investment Company Act of 1940 (the "1940 Act"), and had three primary business focuses: (1) investing in start-up and early stage development companies, (2) operating an investment vehicle that specialized in bridge financing to small and medium-sized companies, and (3) providing accounts receivable-based commercial financing, or factoring, and related services.

On November 1, 1999, we acquired Tower Hill Securities, Inc. ("Tower Hill"), a New York corporation, and we changed...