Dictionary of Exit Planning Terms

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Mezzanine Financing

Mezzanine capital, in finance, refers to a subordinated debt or preferred equity instrument that represents a claim on a company's assets which is senior only to that of the common shares. Mezzanine financing can be structured either as debt (typically an unsecured and subordinated note) or preferred stock.

Mezzanine financing is often provided by private placements and typically require a higher return than on secured or other more senior debts.