Edgar Filing: Main Street Capital CORP

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TABLE OF CONTENTS

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q


(Mark One)
ý		QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2015
OR
o		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from: to

Commission File Number: 001-33723

Main Street Capital Corporation
(Exact name of registrant as specified in its charter)


Maryland (State or other jurisdiction of incorporation or organization)		41-2230745 (I.R.S. Employer Identification No.)
1300 Post Oak Boulevard, 8^th floor Houston, TX (Address of principal executive offices)		77056 (Zip Code)

(713) 350-6000
(Registrant's telephone number including area code)

n/a
(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes o No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):


Large accelerated filer ý		Accelerated filer o		Non-accelerated filer o		Smaller reporting company o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No ý

The number of shares outstanding of the issuer's common stock as of August 7, 2015 was 49,989,475.

Table of Contents

TABLE OF CONTENTS

PART I
FINANCIAL INFORMATION


Item 1.	Consolidated Financial Statements
	Consolidated Balance Sheets—June 30, 2015 (unaudited) and December 31, 2014	2
	Consolidated Statements of Operations (unaudited)—Three and six months ended June 30, 2015 and 2014	3
	Consolidated Statements of Changes in Net Assets (unaudited)—Six months ended June 30, 2015 and 2014	4
	Consolidated Statements of Cash Flows (unaudited)—Six months ended June 30, 2015 and 2014	5
	Consolidated Schedule of Investments (unaudited)—June 30, 2015	6
	Consolidated Schedule of Investments—December 31, 2014	33
	Notes to Consolidated Financial Statements (unaudited)	59
	Consolidated Financial Statement Schedule
	Consolidated Schedule of Investments in and Advances to Affiliates for the Six Months Ended June 30, 2015	99
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	103
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	129
Item 4.	Controls and Procedures	130

PART II
OTHER INFORMATION


Item 1.	Legal Proceedings	131
Item 1A.	Risk Factors	131
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	131
Item 6.	Exhibits	132
	Signatures	133

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Balance Sheets

(in thousands, except shares and per share amounts)

	June 30, 2015			December 31, 2014

	(Unaudited)
ASSETS
Portfolio investments at fair value:
Control investments (cost: $344,675 and $342,847 as of June 30, 2015 and December 31, 2014, respectively)	$	500,035		$	469,846
Affiliate investments (cost: $315,018 and $266,243 as of June 30, 2015 and December 31, 2014, respectively)		327,470			278,675
Non-Control/Non-Affiliate investments (cost: $977,915 and $832,312 as of June 30, 2015 and December 31, 2014, respectively)		962,847			814,809

Total portfolio investments (cost: $1,637,608 and $1,441,402 as of June 30, 2015 and December 31, 2014, respectively)		1,790,352			1,563,330
Marketable securities and idle funds investments (cost: $10,260 and $10,604 as of June 30, 2015 and December 31, 2014, respectively)		8,850			9,067

Total investments (cost: $1,647,868 and $1,452,006 as of June 30, 2015 and December 31, 2014, respectively)		1,799,202			1,572,397
Cash and cash equivalents		41,592			60,432
Interest receivable and other assets		24,668			23,273
Receivable for securities sold		10,827			23,133
Deferred financing costs (net of accumulated amortization of $7,725 and $6,462 as of June 30, 2015 and December 31, 2014, respectively)		13,417			14,550

Total assets	$	1,889,706		$	1,693,785



LIABILITIES
Credit facility	$	226,000		$	218,000
SBIC debentures (par: $225,000 as of June 30, 2015 and December 31, 2014, par of $75,200 is recorded at a fair value of $73,753 and $72,981 as of June 30, 2015 and December 31, 2014, respectively)		223,553			222,781
4.50% Notes		175,000			175,000
6.125% Notes		90,810			90,823
Payable for securities purchased		58,256			14,773
Deferred tax liability, net		3,404			9,214
Dividend payable		8,739			7,663
Accounts payable and other liabilities		7,665			10,701
Interest payable		5,463			4,848

Total liabilities		798,890			753,803
Commitments and contingencies (Note M)
NET ASSETS
Common stock, $0.01 par value per share (150,000,000 shares authorized; 49,938,534 and 45,079,150 shares issued and outstanding as of June 30, 2015 and December 31, 2014, respectively)		499			451
Additional paid-in capital		992,108			853,606
Accumulated net investment income, net of cumulative dividends of $356,413 and $293,789 as of June 30, 2015 and December 31, 2014, respectively		11,733			23,665
Accumulated net realized gain from investments (accumulated net realized gain from investments of $32,628 before cumulative dividends of $62,096 as of June 30, 2015 and accumulated net realized gain from investments of $40,321 before cumulative dividends of $60,777 as of December 31, 2014)		(29,468	)		(20,456	)
Net unrealized appreciation, net of income taxes		115,944			82,716

Total net assets		1,090,816			939,982

Total liabilities and net assets	$	1,889,706		$	1,693,785



NET ASSET VALUE PER SHARE	$	21.84		$	20.85

The accompanying notes are an integral part of these financial statements

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MAIN STREET CAPITAL CORPORATION

Consolidated Statements of Operations

(in thousands, except per share amounts)

(Unaudited)

	Three Months Ended June 30,						Six Months Ended June 30,

	2015			2014			2015			2014
INVESTMENT INCOME:
Interest, fee and dividend income:
Control investments	$	11,492		$	10,546		$	22,827		$	19,842
Affiliate investments		6,961			6,085			13,010			11,725
Non-Control/Non-Affiliate investments		22,613			18,016			42,034			33,649

Interest, fee and dividend income		41,066			34,647			77,871			65,216
Interest, fee and dividend income from marketable securities and idle funds		242			230			616			437

Total investment income		41,308			34,877			78,487			65,653
EXPENSES:
Interest		(7,657	)		(5,473	)		(15,453	)		(10,759	)
Compensation		(3,835	)		(3,717	)		(7,328	)		(6,068	)
General and administrative		(2,098	)		(1,571	)		(4,060	)		(3,408	)
Share-based compensation		(1,679	)		(974	)		(2,942	)		(1,826	)
Expenses charged to the External Investment Manager		1,162			436			1,988			727

Total expenses		(14,107	)		(11,299	)		(27,795	)		(21,334	)

NET INVESTMENT INCOME		27,201			23,578			50,692			44,319
NET REALIZED GAIN (LOSS):
Control investments		3,324			—			3,324			—
Affiliate investments		(136	)		(6,578	)		(137	)		(6,578	)
Non-Control/Non-Affiliate investments		(8,633	)		239			(10,640	)		1,672
Marketable securities and idle funds investments		(128	)		(25	)		(240	)		(15	)

Total net realized loss		(5,573	)		(6,364	)		(7,693	)		(4,921	)

NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION):
Portfolio investments		15,901			17,053			30,105			23,910
Marketable securities and idle funds investments		(123	)		298			127			1,346
SBIC debentures		(80	)		(840	)		(772	)		(2,029	)

Total net change in unrealized appreciation		15,698			16,511			29,460			23,227

INCOME TAXES:
Federal and state income, excise and other taxes		(1,665	)		(132	)		(2,042	)		(799	)
Deferred taxes		5,141			(3,643	)		5,810			(4,641	)

Income tax benefit (provision)		3,476			(3,775	)		3,768			(5,440	)

NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	40,802		$	29,950		$	76,227		$	57,185



NET INVESTMENT INCOME PER SHARE—BASIC AND DILUTED	$	0.55		$	0.53		$	1.06		$	1.05



NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS PER SHARE—BASIC AND DILUTED	$	0.82		$	0.68		$	1.59		$	1.36



DIVIDENDS PAID PER SHARE:
Regular monthly dividends	$	0.525		$	0.495		$	1.035		$	0.990
Supplemental dividends		0.275			0.275			0.275			0.275

Total dividends	$	0.800		$	0.770		$	1.310		$	1.265



WEIGHTED AVERAGE SHARES OUTSTANDING—BASIC AND DILUTED		49,883,321			44,216,906			47,992,268			42,069,669

The accompanying notes are an integral part of these financial statements

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MAIN STREET CAPITAL CORPORATION

Consolidated Statements of Changes in Net Assets

(in thousands, except shares)

(Unaudited)

	Common Stock												Accumulated Net Realized Gain From Investments, Net of Dividends			Net Unrealized Appreciation from Investments, Net of Income Taxes

	Common Stock									Accumulated Net Investment Income, Net of Dividends
	Number of Shares			Par Value			Additional Paid-In Capital			Accumulated Net Investment Income, Net of Dividends								Total Net Asset Value
Balances at December 31, 2013		39,852,604		$	398		$	694,981		$	22,778		$	(26,334	)	$	100,710	$	792,533
Public offering of common stock, net of offering costs		4,600,000			46			139,651			—			—			—		139,697
Share-based compensation		—			—			1,826			—			—			—		1,826
Purchase of vested stock for employee payroll tax withholding		(36,425	)		—			(1,149	)		—			—			—		(1,149	)
Dividend reinvestment		225,613			2			7,347			—			—			—		7,349
Amortization of directors' deferred compensation		—			—			160			—			—			—		160
Issuance of restricted stock		228,008			3			(3	)		—			—			—		—
Dividends to stockholders		—			—			—			(52,619	)		(1,572	)		—		(54,191	)
Net increase (loss) resulting from operations		—			—			—			44,319			(4,921	)		17,787		57,185

Balances at June 30, 2014		44,869,800		$	449		$	842,813		$	14,478		$	(32,827	)	$	118,497	$	943,410



Balances at December 31, 2014		45,079,150		$	451		$	853,606		$	23,665		$	(20,456	)	$	82,716	$	939,982
Public offering of common stock, net of offering costs		4,370,000			44			127,720			—			—			—		127,764
Share-based compensation		—			—			2,942			—			—			—		2,942
Purchase of vested stock for employee payroll tax withholding		(54,790	)		(1	)		(1,737	)		—			—			—		(1,738	)
Dividend reinvestment		304,100			3			9,394			—			—			—		9,397
Amortization of directors' deferred compensation		—			—			185			—			—			—		185
Issuance of restricted stock		240,074			2			(2	)		—			—			—		—
Dividends to stockholders		—			—			—			(62,624	)		(1,319	)		—		(63,943	)
Net increase (loss) resulting from operations		—			—			—			50,692			(7,693	)		33,228		76,227

Balances at June 30, 2015		49,938,534		$	499		$	992,108		$	11,733		$	(29,468	)	$	115,944	$	1,090,816

The accompanying notes are an integral part of these financial statements

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MAIN STREET CAPITAL CORPORATION

Consolidated Statements of Cash Flows

(in thousands)

(Unaudited)

	Six Months Ended June 30,

	2015			2014
CASH FLOWS FROM OPERATING ACTIVITIES
Net increase in net assets resulting from operations	$	76,227		$	57,185
Adjustments to reconcile net increase in net assets resulting from operations to net cash used in operating activities:
Investments in portfolio companies		(483,365	)		(396,660	)
Proceeds from sales and repayments of debt investments in portfolio companies		324,309			226,804
Proceeds from sales and return of capital of equity investments in portfolio companies		16,174			1,208
Investments in marketable securities and idle funds investments		(3,463	)		(11,901	)
Proceeds from sales and repayments of marketable securities and idle funds investments		3,566			14,461
Net change in unrealized appreciation		(29,460	)		(23,227	)
Net realized loss		7,693			4,921
Accretion of unearned income		(4,397	)		(6,020	)
Payment-in-kind interest		(1,534	)		(3,051	)
Cumulative dividends		(734	)		(752	)
Share-based compensation expense		2,942			1,826
Amortization of deferred financing costs		1,263			776
Deferred taxes		(5,810	)		4,641
Changes in other assets and liabilities:
Interest receivable and other assets		(1,092	)		(5,122	)
Interest payable		615			2,440
Accounts payable and other liabilities		(3,211	)		(4,573	)
Deferred fees and other		1,024			586

Net cash used in operating activities		(99,253	)		(136,458	)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from public offering of common stock, net of offering costs		127,764			139,697
Dividends paid		(53,470	)		(46,016	)
Proceeds from issuance of SBIC debentures		—			24,800
Proceeds from credit facility		301,000			213,000
Repayments on credit facility		(293,000	)		(197,000	)
Payment of deferred loan costs and SBIC debenture fees		(130	)		(1,080	)
Purchase of vested stock for employee payroll tax withholding		(1,738	)		(1,149	)
Other		(13	)		—

Net cash provided by financing activities		80,413			132,252

Net decrease in cash and cash equivalents		(18,840	)		(4,206	)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD		60,432			34,701

CASH AND CASH EQUIVALENTS AT END OF PERIOD	$	41,592		$	30,495



Supplemental cash flow disclosures:
Interest paid	$	13,575		$	7,545
Taxes paid	$	2,219		$	3,089
Non-cash financing activities:
Shares issued pursuant to the DRIP	$	9,397		$	7,349

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule Of Investments

June 30, 2015

(in thousands)

(Unaudited)

Portfolio Company(1)	Business Description	Type of Investment(2)(3)


Control Investments(5)

ASC Interests, LLC	Recreational and Educational Shooting Facility
		11% Secured Debt (Maturity—July 31, 2018)	2,750	2,712	2,750
		Member Units (1,500 units)(8)		1,500	2,230

				4,212	4,980

Bond-Coat, Inc.	Casing and Tubing Coating Services
		12% Secured Debt (Maturity—December 28, 2017)	11,596	11,505	11,596
		Common Stock (57,508 shares)		6,350	10,210

				17,855	21,806

Café Brazil, LLC	Casual Restaurant Group
		Member Units (1,233 units)(8)		1,742	6,980

CBT Nuggets, LLC	Produces and Sells IT Training Certification Videos
		Member Units (416 units)(8)		1,300	34,800

Ceres Management, LLC (Lambs Tire & Automotive)	Aftermarket Automotive Services Chain
		14% Secured Debt (Maturity—May 31, 2018)	3,738	3,738	3,738
		Class B Member Units (12% cumulative)(8)		4,298	4,298
		Member Units (5,460 units)		5,273	3,160
		9.5% Secured Debt (Lamb's Real Estate Investment I, LLC) (Maturity—October 1, 2025)	943	943	943
		Member Units (Lamb's Real Estate Investment I, LLC) (1,000 units)(8)		625	1,240

				14,877	13,379

CMS Minerals LLC	Oil & Gas Exploration & Production
		Preferred Member Units (458 units)(8)		3,441	3,441

Datacom, LLC	Technology and Telecommunications Provider
		8% Secured Debt (Maturity—May 30, 2016)	675	675	675
		10.5% Secured Debt (Maturity—May 31, 2019)	11,205	11,112	11,112
		Preferred Member Units (6,453 units)		6,030	5,570

				17,817	17,357

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MAIN STREET CAPITAL CORPORATION

Consolidated Schedule Of Investments (Continued)

June 30, 2015

(in thousands)

(Unaudited)

Portfolio Company(1)	Business Description	Type of Investment(2)(3)


Garreco, LLC	Manufacturer and Supplier of Dental Products
		14% Secured Debt (Maturity—January 12, 2018)	5,800	5,727	5,727
		Member Units (1,200 units)(8)		1,200	1,470

				6,927	7,197

GRT Rubber Technologies LLC	Manufacturer of Engineered Rubber Products
		LIBOR Plus 9.00% (Floor 1.00%), Current Coupon 10.00%, Secured Debt (Maturity—December 19, 2019)(9)	16,541	16,390	16,390
		Member Units (5,879 units)(8)		13,065	13,065

				29,455	29,455

Gulf Manufacturing, LLC	Manufacturer of Specialty Fabricated Industrial Piping Products
		9% PIK Secured Debt (Ashland Capital IX, LLC) (Maturity—June 30, 2017)	783	783	783
		Member Units (438 units)(8)		2,980	16,540

				3,763	17,323

Harrison Hydra-Gen, Ltd.	Manufacturer of Hydraulic Generators
		12% Secured Debt (Maturity—September 4, 2015)	5,010	5,010	5,010
		Preferred Stock (8% cumulative)(8)		1,311	1,311
		Common Stock (107,456 shares)		718	2,130

				7,039	8,451

Hawthorne Customs and Dispatch Services, LLC	Facilitator of Import Logistics, Brokerage, and Warehousing
		Member Units (500 units)(8)		589	580
		Member Units (Wallisville Real Estate, LLC) (588,210 units)(8)		1,215	2,220

				1,804	2,800

Hydratec, Inc.	Designer and Installer of Micro-Irrigation Systems
		Common Stock (7,095 shares)(8)		7,095	14,310

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MAIN STREET CAPITAL CORPORATION

Consolidated Schedule Of Investments (Continued)

June 30, 2015

(in thousands)

(Unaudited)

Portfolio Company(1)	Business Description	Type of Investment(2)(3)


IDX Broker, LLC	Provider of Marketing and CRM Tools for the Real Estate Industry
		LIBOR Plus 6.50% (Floor 1.50%), Current Coupon 8.00%, Secured Debt (Maturity—November 18, 2018)(9)	100	100	100
		12.5% Secured Debt (Maturity—November 18, 2018)	11,350	11,272	11,350
		Member Units (5,400 units)		5,606	6,440

				16,978	17,890

Impact Telecom, Inc.	Telecommunications Services Provider
		LIBOR Plus 6.50% (Floor 2.00%), Current Coupon 8.50%, Secured Debt (Maturity—May 31, 2018)(9)	1,575	1,570	1,570
		13% Secured Debt (Maturity—May 31, 2018)	22,500	15,893	15,893
		Warrants (5,516,667 equivalent shares)		8,000	4,160

				25,463	21,623

Indianapolis Aviation Partners, LLC	Fixed Base Operator
		15% Secured Debt (Maturity—January 15, 2016)	3,100	3,065	3,100
		Warrants (1,046 equivalent units)		1,129	2,540

				4,194	5,640

Jensen Jewelers of Idaho, LLC	Retail Jewelry Store
		Prime Plus 6.75% (Floor 2.00%), Current Coupon 10.00%, Secured Debt (Maturity—November 14, 2016)(9)	4,355	4,311	4,355
		Member Units (627 units)(8)		811	4,600

				5,122	8,955

Lighting Unlimited, LLC	Commercial and Residential Lighting Products and Design Services
		8% Secured Debt (Maturity—August 22, 2015)	1,514	1,514	1,514
		Preferred Equity (non-voting)		434	434
		Warrants (71 equivalent units)		54	40
		Member Units (700 units)(8)		100	420

				2,102	2,408

Marine Shelters Holdings, LLC (LoneStar Marine Shelters)	Fabricator of Marine and Industrial Shelters
		6% Current / 6% PIK Secured Debt (Maturity—December 28, 2017)	8,648	8,548	8,548
		Preferred Member Units (3,810 units)		5,352	5,352

				13,900	13,900

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MAIN STREET CAPITAL CORPORATION

Consolidated Schedule Of Investments (Continued)

June 30, 2015

(in thousands)

(Unaudited)

Portfolio Company(1)	Business Description	Type of Investment(2)(3)


Mid-Columbia Lumber Products, LLC	Manufacturer of Finger-Jointed Lumber Products
		10% Secured Debt (Maturity—December 18, 2017)	1,750	1,750	1,750
		12% Secured Debt (Maturity—December 18, 2017)	3,900	3,900	3,900
		Member Units (2,829 units)(8)		1,244	7,390
		9.5% Secured Debt (Mid—Columbia Real Estate, LLC) (Maturity—May 13, 2025)	904	904	904
		Member Units (Mid—Columbia Real Estate, LLC) (250 units)(8)		250	550

				8,048	14,494

MSC Adviser I, LLC(16)	Third Party Investment Advisory Services
		Member Units (Fully diluted 100.0%)(8)		—	29,930

Mystic Logistics, Inc	Logistics and Distribution Services Provider for Large Volume Mailers
		12% Secured Debt (Maturity—August 15, 2019)	10,000	9,808	10,000
		Common Stock (5,873 shares)(8)		2,720	6,580

				12,528	16,580

NAPCO Precast, LLC	Precast Concrete Manufacturing
		Prime Plus 2.00% (Floor 7.00%), Current Coupon 9.00%, Secured Debt (Maturity—September 1, 2015)(9)	625	623	625
		Prime Plus 2.00% (Floor 7.00%), Current Coupon 9.00%, Secured Debt (Maturity—February 1, 2016)(9)	2,923	2,919	2,923
		18% Secured Debt (Maturity—February 1, 2016)	4,468	4,453	4,468
		Member Units (2,955 units)(8)		2,975	8,440

				10,970	16,456

NRI Clinical Research, LLC	Clinical Research Service Provider
		14% Secured Debt (Maturity—September 8, 2017)	4,740	4,640	4,640
		Warrants (251,723 equivalent units)		252	160
		Member Units (1,454,167 units)		765	816

				5,657	5,616

NRP Jones, LLC	Manufacturer of Hoses, Fittings and Assemblies
		12% Secured Debt (Maturity—December 22, 2016)	13,224	12,823	12,823
		Warrants (14,331 equivalent units)		817	740
		Member Units (50,877 units)(8)		2,900	2,480

				16,540	16,043

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule Of Investments (Continued)

June 30, 2015

(in thousands)

(Unaudited)

Portfolio Company(1)	Business Description	Type of Investment(2)(3)


OMi Holdings, Inc.	Manufacturer of Overhead Cranes
		Common Stock (1,500 shares)(8)		1,080	13,420

Pegasus Research Group, LLC (Televerde)	Provider of Telemarketing and Data Services
		Member Units (460 units)(8)		1,290	6,490

PPL RVs, Inc.	Recreational Vehicle Dealer
		11.1% Secured Debt (Maturity—January 1, 2016)	9,960	9,960	9,960
		Common Stock (1,962 shares)		2,150	8,430

				12,110	18,390

Principle Environmental, LLC	Noise Abatement Service Provider
		12% Secured Debt (Maturity—April 30, 2017)	4,060	3,921	4,060
		12% Current / 2% PIK Secured Debt (Maturity—April 30, 2017)	3,277	3,267	3,277
		Preferred Member Units (19,631 units)(8)		4,663	9,560
		Warrants (1,036 equivalent units)		1,200	530

				13,051	17,427

Quality Lease Service, LLC	Provider of Rigsite Accommodation Unit Rentals and Related Services
		8% PIK Secured Debt (Maturity—June 8, 2020)	6,250	6,250	6,250
		Member Units (1,000 units)		430	2,500

				6,680	8,750

River Aggregates, LLC	Processor of Construction Aggregates
		Zero Coupon Secured Debt (Maturity—June 30, 2018)	750	524	524
		Member Units (1,150 units)(8)		1,150	3,760
		Member Units (RA Properties, LLC) (1,500 units)		369	2,300

				2,043	6,584

SoftTouch Medical Holdings LLC	Home Provider of Pediatric Durable Medical Equipment
		LIBOR Plus 9.00% (Floor 1.00%), Current Coupon 10.00%, Secured Debt (Maturity—October 31, 2019)(9)	8,330	8,256	8,256
		Member Units (4,450 units)(8)		4,930	4,930

				13,186	13,186

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule Of Investments (Continued)

June 30, 2015

(in thousands)

(Unaudited)

Portfolio Company(1)	Business Description	Type of Investment(2)(3)


Southern RV, LLC	Recreational Vehicle Dealer
		13% Secured Debt (Maturity—August 8, 2018)	11,400	11,280	11,400
		Member Units (1,680 units)(8)		1,680	6,670
		13% Secured Debt (Southern RV Real Estate, LLC) (Maturity—August 8, 2018)	3,250	3,216	3,250
		Member Units (Southern RV Real Estate, LLC) (480 units)		480	540

				16,656	21,860

The MPI Group, LLC	Manufacturer of Custom Hollow Metal Doors, Frames and Accessories
		9% Secured Debt (Maturity—October 2, 2018)	2,924	2,920	2,920
		Series A Preferred Units (2,500 units; 10% Cumulative)		2,500	980
		Warrants (1,424 equivalent units)		1,096	—
		Member Units (MPI Real Estate Holdings, LLC) (100% Fully diluted)(8)		2,300	2,230

				8,816	6,130

Travis Acquisition LLC	Manufacturer of Aluminum Trailers
		12% Secured Debt (Maturity—August 30, 2018)	3,743	3,691	3,744
		Member Units (7,282 units)		7,100	14,110

				10,791	17,854

Uvalco Supply, LLC	Farm and Ranch Supply Store
		9% Secured Debt (Maturity—January 1, 2019)	1,520	1,520	1,520
		Member Units (1,006 units)(8)		1,113	3,350

				2,633	4,870

Vision Interests, Inc.	Manufacturer / Installer of Commercial Signage
		13% Secured Debt (Maturity—December 23, 2016)	3,154	3,128	3,128
		Series A Preferred Stock (3,000,000 shares)		3,000	3,550
		Common Stock (1,126,242 shares)		3,706	210

				9,834	6,888

Ziegler's NYPD, LLC	Casual Restaurant Group
		6.5% Secured Debt (Maturity—October 1, 2019)	1,000	992	992
		12% Secured Debt (Maturity—October 1, 2019)	500	500	500
		14% Secured Debt (Maturity—October 1, 2019)	2,750	2,750	2,750
		Warrants (587 equivalent units)		600	—
		Member units (10,072 units)		2,834	2,130

				7,676	6,372

Subtotal Control Investments (27.8% of total investments at fair value)				344,675	500,035

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule Of Investments (Continued)

June 30, 2015

(in thousands)

(Unaudited)

Portfolio Company(1)	Business Description	Type of Investment(2)(3)


Affiliate Investments(6)

AFG Capital Group, LLC	Provider of Rent-to-Own Financing Solutions and Services
		11% Secured Debt (Maturity—November 7, 2019)	12,160	11,787	11,787
		Warrants (42 equivalent units)		259	259
		Member Units (186 units)		1,200	1,200

				13,246	13,246

Boss Industries, LLC	Manufacturer and Distributor of Air Compressors, Auxiliary Power Units, Gas Booster Systems and Vapor Recovery Systems
		Preferred Member Units (2,242 units)(8)		2,000	2,340

Bridge Capital Solutions Corporation	Financial Services and Cash Flow Solutions Provider
		13% Secured Debt (Maturity—April 18, 2017)	7,000	6,854	6,854
		Warrants (22 equivalent shares)		200	1,020

				7,054	7,874

Buca C, LLC	Restaurants
		LIBOR Plus 7.25% (Floor 1.00%), Current Coupon 8.25%, Secured Debt (Maturity—June 30, 2020)(9)	25,200	24,951	24,951
		Preferred Member Units (6 units)(8)		3,600	3,600

				28,551	28,551

CAI Software LLC	Provider of Specialized Enterprise Resource Planning Software
		12% Secured Debt (Maturity—October 10, 2019)	5,400	5,352	5,352
		Member Units (65,356 units)(8)		654	840

				6,006	6,192

Condit Exhibits, LLC	Tradeshow Exhibits / Custom Displays Provider
		Member Units (3,936 units)(8)		100	770

Congruent Credit Opportunities Funds(12)(13)	Investment Partnership
		LP Interests (Congruent Credit Opportunities Fund II, LP) (Fully diluted 19.8%)(8)		15,743	14,559
		LP Interests (Congruent Credit Opportunities Fund III, LP) (Fully diluted 17.4%)		9,450	9,450

				25,193	24,009

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule Of Investments (Continued)

June 30, 2015

(in thousands)

(Unaudited)

Portfolio Company(1)	Business Description	Type of Investment(2)(3)


Daseke, Inc.	Specialty Transportation Provider
		12% Current / 2.5% PIK Secured Debt (Maturity—July 31, 2018)	20,984	20,697	20,984
		Common Stock (19,467 shares)		5,213	22,660

				25,910	43,644

Dos Rios Partners(12)(13)	Investment Partnership
		LP Interests (Dos Rios Partners, LP) (Fully diluted 20.2%)(8)		2,325	1,312
		LP Interests (Dos Rios Partners—A, LP) (Fully diluted 6.4%)(8)		738	417

				3,063	1,729

East Teak Fine Hardwoods, Inc.	Distributor of Hardwood Products
		Common Stock (5,000 shares)(8)		480	860

East West Copolymer & Rubber, LLC	Manufacturer of Synthetic Rubbers
		12% Secured Debt (Maturity—October 17, 2019)	9,600	9,449	9,449
		Warrants (1,823,278 equivalent units)		50	50

				9,499	9,499

Freeport Financial SBIC Fund LP(12)(13)	Investment Partnership
		LP Interests (Fully diluted 9.9%)(8)		5,140	5,140

Gault Financial, LLC (RMB Capital, LLC)	Purchases and Manages Liquidation of Distressed Assets
		10% Secured Debt (Maturity—November 21, 2016)	13,046	12,820	10,854
		Warrants (29,025 equivalent units)		400	—

				13,220	10,854

Glowpoint, Inc.	Provider of Cloud Managed Video Collaboration Services
		8% Secured Debt (Maturity—October 18, 2018)	100	102	102
		12% Secured Debt (Maturity—October 18, 2018)	9,000	8,919	8,919
		Common Stock (7,711,517 shares)		3,958	6,120

				12,979	15,141

Guerdon Modular Holdings, Inc.	Multi-Family and Commercial Modular Construction Company
		11% Secured Debt (Maturity—August 13, 2019)	10,400	10,267	10,267
		Common Stock (170,577 shares)		2,983	2,983

				13,250	13,250

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule Of Investments (Continued)

June 30, 2015

(in thousands)

(Unaudited)

Portfolio Company(1)	Business Description	Type of Investment(2)(3)


Houston Plating and Coatings, LLC	Provider of Plating and Industrial Coating Services
		Member Units (248,082 units)(8)		996	11,470

Indianhead Pipeline Services, LLC	Provider of Pipeline Support Services
		12% Secured Debt (Maturity—February 6, 2017)	6,450	6,239	6,239
		Preferred Member Units (33,819 units; 8% cumulative)(8)		2,157	2,157
		Warrants (31,928 equivalent units)		459	—
		Member Units (14,732 units)		1	—

				8,856	8,396

irth Solutions, LLC	Provider of Damage Prevention Information Technology Services
		Member Units (128 units)(8)		624	6,300

KBK Industries, LLC	Manufacturer of Specialty Oilfield and Industrial Products
		12.5% Secured Debt (Maturity—September 28, 2017)	6,250	6,217	6,250
		Member Units (250 units)(8)		341	4,570

				6,558	10,820

L.F. Manufacturing Holdings, LLC(10)	Manufacturer of Fiberglass Products
		Member Units (2,000,000 units)(8)		2,019	1,855

MPS Denver, LLC	Specialty Card Printing
		Member Units (13,800 units)		1,130	1,130

OnAsset Intelligence, Inc.	Provider of Transportation Monitoring / Tracking Products and Services
		12% PIK Secured Debt (Maturity—December 31, 2015)	3,772	3,772	3,772
		Preferred Stock (912 shares; 7% cumulative)(8)		1,981	1,380
		Warrants (5,333 equivalent shares)		1,919	—

				7,672	5,152

OPI International Ltd.(13)	Provider of Man Camp and Industrial Storage Services
		10% Unsecured Debt (Maturity—April 8, 2018)	244	244	244
		Common Stock (20,766,317 shares)		1,371	3,200

				1,615	3,444

PCI Holding Company, Inc.	Manufacturer of Industrial Gas Generating Systems
		Preferred Stock (1,500,000 shares; 20% cumulative)(8)		2,496	5,092

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule Of Investments (Continued)

June 30, 2015

(in thousands)

(Unaudited)

Portfolio Company(1)	Business Description	Type of Investment(2)(3)


Radial Drilling Services Inc.	Oil and Gas Lateral Drilling Technology Provider
		12% Secured Debt (Maturity—November 22, 2016)	4,200	3,886	2,918
		Warrants (316 equivalent shares)		758	—

				4,644	2,918

Rocaceia, LLC (Quality Lease and Rental Holdings, LLC)	Provider of Rigsite Accommodation Unit Rentals and Related Services
		12% Secured Debt (Maturity—January 8, 2018)(14)(18)	30,785	30,281	250
		Preferred Member Units (250 units)		2,500	—

				32,781	250

Samba Holdings, Inc.	Provider of Intelligent Driver Record Monitoring Software and Services
		12.5% Secured Debt (Maturity—November 17, 2016)	26,304	26,129	26,304
		Common Stock (170,963 shares)		2,087	10,270

				28,216	36,574

Tin Roof Acquisition Company	Casual Restaurant Group
		12% Secured Debt (Maturity—November 30, 2018)	14,100	13,885	13,885
		Class C Preferred Stock (Fully diluted 10.0%; 10% cumulative)(8)		2,355	2,355

				16,240	16,240

Universal Wellhead Services Holdings, LLC(10)	Provider of Wellhead Equipment, Designs, and Personnel to the Oil & Gas Industry
		Class A Units (4,000,000 units)(8)		4,000	3,250

Volusion, LLC	Provider of Online Software-as-a-Service eCommerce Solutions
		10.5% Secured Debt (Maturity—January 26, 2020)	17,500	16,080	16,080
		Warrants (950,618 equivalent units)		1,400	1,400
		Preferred Member Units (4,876,670 units)		14,000	14,000

				31,480	31,480

Subtotal Affiliate Investments (18.2% of total investments at fair value)				315,018	327,470

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule Of Investments (Continued)

June 30, 2015

(in thousands)

(Unaudited)

Portfolio Company(1)	Business Description	Type of Investment(2)(3)


Non-Control/Non-Affiliate Investments(7)

Allflex Holdings III Inc.(11)	Manufacturer of Livestock Identification Products
		LIBOR Plus 7.00% (Floor 1.00%), Current Coupon 8.00%, Secured Debt (Maturity—July 19, 2021)(9)	10,150	10,075	10,229

AM General LLC(11)	Specialty Vehicle Manufacturer
		LIBOR Plus 9.00% (Floor 1.25%), Current Coupon 10.25%, Secured Debt (Maturity—March 22, 2018)(9)	2,256	2,214	2,109

AM3 Pinnacle Corporation(10)	Provider of Comprehensive Internet, TV and Voice Services for Multi-Dwelling Unit Properties
		10% Secured Debt (Maturity—October 22, 2018)	22,172	22,048	19,548
		Common Stock (60,240 shares)		2,000	—

				24,048	19,548

AmeriTech College, LLC	For-Profit Nursing and Healthcare College
		10% Secured Debt (Maturity—November 30, 2019)	685	685	685
		10% Secured Debt (Maturity—January 31, 2020)	4,235	4,235	3,700

				4,920	4,385

AMF Bowling Centers, Inc.(11)	Bowling Alley Operator
		LIBOR Plus 6.25% (Floor 1.00%), Current Coupon 7.25%, Secured Debt (Maturity—September 18, 2021)(9)	7,947	7,834	7,977

Anchor Hocking, LLC(11)	Household Products Manufacturer
		LIBOR Plus 9.00% (Floor 1.00%), Current Coupon 10.00%, Secured Debt (Maturity—June 4, 2018)(9)	2,312	2,312	2,306
		Member Units (440,620 units)		4,928	3,892

				7,240	6,198

AP Gaming I, LLC(10)	Developer, Manufacturer, and Operator of Gaming Machines
		LIBOR Plus 8.25% (Floor 1.00%), Current Coupon 9.25%, Secured Debt (Maturity—December 20, 2020)(9)	9,913	9,708	9,899

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule Of Investments (Continued)

June 30, 2015

(in thousands)

(Unaudited)

Portfolio Company(1)	Business Description	Type of Investment(2)(3)


Applied Products, Inc.(10)	Adhesives Distributor
		LIBOR Plus 6.50% (Floor 1.00%), Current Coupon 7.50%, Secured Debt (Maturity—September 30, 2019)(9)	5,888	5,828	5,828

Arcus Hunting LLC.(10)	Manufacturer of Bowhunting and Archery Products and Accessories
		LIBOR Plus 7.00% (Floor 1.00%), Current Coupon 8.00%, Secured Debt (Maturity—November 13, 2019)(9)	9,866	9,743	9,743

Artel, LLC(11)	Provider of Secure Satellite Network and IT Solutions
		LIBOR Plus 6.00% (Floor 1.25%), Current Coupon 7.25%, Secured Debt (Maturity—November 27, 2017)(9)	8,515	8,364	8,323

ATS Workholding, Inc.(10)	Manufacturer of Machine Cutting Tools and Accessories
		LIBOR Plus 7.00% (Floor 1.00%), Current Coupon 8.00%, Secured Debt (Maturity—March 10, 2019)(9)	6,651	6,605	6,605

ATX Networks Corp.(11)(13)	Provider of Radio Frequency Management Equipment
		LIBOR Plus 6.00% (Floor 1.00%), Current Coupon 7.00%, Secured Debt (Maturity—June 14, 2021)(9)	15,000	14,700	14,963

Berry Aviation, Inc.(10)	Airline Charter Service Operator
		12.00% Current / 1.75% PIK Secured Debt (Maturity—January 20, 2020)	5,627	5,574	5,574
		Common Stock (553 shares)		400	400

				5,974	5,974

Bioventus LLC(10)	Production of Orthopedic Healing Products
		LIBOR Plus 10.00% (Floor 1.00%), Current Coupon 11.00%, Secured Debt (Maturity—April 10, 2020)(9)	5,000	4,910	5,000

Blackbrush Oil and Gas LP(11)	Oil & Gas Exploration
		LIBOR Plus 6.50% (Floor 1.00%), Current Coupon 7.50%, Secured Debt (Maturity—July 30, 2021)(9)	4,000	3,973	3,715

Blackhawk Specialty Tools LLC(11)	Oilfield Equipment & Services
		LIBOR Plus 5.25% (Floor 1.25%), Current Coupon 6.50%, Secured Debt (Maturity—August 1, 2019)(9)	6,058	6,028	5,877

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule Of Investments (Continued)

June 30, 2015

(in thousands)

(Unaudited)

Portfolio Company(1)	Business Description	Type of Investment(2)(3)


Blue Bird Body Company(11)	School Bus Manufacturer
		LIBOR Plus 5.50% (Floor 1.00%), Current Coupon 6.50%, Secured Debt (Maturity—June 26, 2020)(9)	11,213	11,068	11,241

Bluestem Brands, Inc.(11)(13)	Multi-Channel Retailer of General Merchandise