Patriot Capital Funding Closes $3.85 Million Subordinated Debt Investment in Support of the Acquisition of Keltner Enterprises and KK&T, Inc. by an Affiliate of Gen Cap America, on December 30, 2005

Business Wire, Jan 4, 2006

WESTPORT, Conn. -- Patriot Capital Funding, Inc. (Nasdaq: PCAP), a specialty finance company providing flexible financing solutions to small- and mid-sized companies primarily in transactions initiated by private equity sponsors, today announced that it closed a $3.85 million subordinated debt investment on December 30, 2005 in support of the acquisition of Keltner Enterprises LLC and KK&T, Inc. ("Keltner") by an affiliate of Gen Cap America. Keltner is a leading distributor of automotive oil, chemicals and parts.

"We are delighted to begin a relationship with Gen Cap America," said Patriot Capital Funding President and CEO Richard Buckanavage. "Gen Cap is a leading financial sponsor operating in our target market and we are pleased to support their acquisition of Keltner."

About Keltner Enterprises LLC and KK&T, Inc. ("Keltner")

Keltner, founded in 1955 and based in Springfield, MO, supplies a broad range of automotive oils, chemicals and parts to customers throughout the Midwest and Eastern United States. Keltner's fixed route distribution model and longstanding supplier and customer relationships allow them to provide a full product line to customers at attractive prices.

About Patriot Capital Funding, Inc.

Patriot Capital Funding, Inc. (www.patcapfunding.com) is a specialty finance company providing customized financing solutions to private equity sponsors focused on making investments in small- to mid-sized companies. Patriot Capital Funding typically invests in companies with annual revenues between $10 million and $100 million, and which operate in diverse industry sectors. Investments usually take the form of senior secured loans, junior secured loans and subordinated debt investments - which may contain equity or equity-related instruments. Patriot Capital Funding also offers "one-stop" financing, which typically includes a revolving credit line, one or more senior term loans and a subordinated debt investment. Patriot Capital Funding also makes equity co-investments up to $2.0 million.

Forward-Looking Statements

This press release may contain certain forward-looking statements, including statements with regard to the future performance of Patriot Capital Funding. Words such as "believes," "expects," "projects," and "future" or similar expressions are intended to identify forward-looking statements. These forward-looking statements are subject to the inherent uncertainties in predicting future results and conditions. Certain factors could cause actual results to differ materially from those projected in these forward-looking statements, and some of these factors are enumerated in Patriot Capital Funding's final prospectus dated July 27, 2005, and other filings with the Securities and Exchange Commission. Patriot Capital Funding undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.