Table of Contents

 

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

(Mark One)

 

x      QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended March 31, 2011

 

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

 

41-2230745

(State or other jurisdiction of incorporation or organization)

 

(I.R.S. Employer Identification No.)

 

 

 

1300 Post Oak Boulevard, Suite 800

 

 

Houston, TX

 

77056

(Address of principal executive offices)

 

(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 x  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 o

 

Accelerated filer x

 

 

 

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 x

 

The number of shares outstanding of the issuer’s common stock as of May 4, 2011 was 22,986,873.

 

 

 



Table of Contents

 

TABLE OF CONTENTS

 

PART I
FINANCIAL INFORMATION

 

 

 

 

Item 1.

Financial Statements

 

 

 

 

 

Consolidated Balance Sheets — March 31, 2011 (unaudited) and December 31, 2010

1

 

 

 

 

Consolidated Statements of Operations (unaudited) — Three months ended March 31, 2011 and 2010

2

 

 

 

 

Consolidated Statements of Changes in Net Assets (unaudited) — Three months ended March 31, 2011 and 2010

3

 

 

 

 

Consolidated Statements of Cash Flows (unaudited) — Three months ended March 31, 2011 and 2010

4

 

 

 

 

Consolidated Schedule of Investments (unaudited) — March 31, 2011

5

 

 

 

 

Consolidated Schedule of Investments — December 31, 2010

13

 

 

 

 

Notes to Consolidated Financial Statements (unaudited)

21

 

 

 

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

39

 

 

 

Item 3.

Quantitative and Qualitative Disclosures about Market Risk

51

 

 

 

Item 4.

Controls and Procedures

51

 

 

 

PART II
OTHER INFORMATION

 

 

 

 

Item 1.

Legal Proceedings

52

 

 

 

Item 1A.

Risk Factors

53

 

 

 

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

53

 

 

 

Item 6.

Exhibits

53

 

 

 

 

Signatures

 

 



Table of Contents

 

PART I — FINANCIAL INFORMATION

 

Item 1. Financial Statements

 

MAIN STREET CAPITAL CORPORATION

Consolidated Balance Sheets

 

 

 

March 31, 2011

 

December 31, 2010

 

 

 

(Unaudited)

 

 

 

ASSETS

 

 

 

 

 

 

 

 

 

 

 

Portfolio investments at fair value:

 

 

 

 

 

Control investments (cost: $189,560,249 and $161,009,443 as of March 31, 2011 and December 31, 2010, respectively)

 

$

204,890,251

 

$

174,596,394

 

Affiliate investments (cost: $68,681,860 and $65,650,789 as of March 31, 2011 and December 31, 2010, respectively)

 

84,810,550

 

80,206,804

 

Non-Control/Non-Affiliate investments (cost: $99,475,430 and $91,911,304 as of March 31, 2011 and December 31, 2010, respectively)

 

100,815,305

 

91,956,221

 

Investment in affiliated Investment Manager (cost: $4,284,042 as of March 31, 2011 and December 31, 2010)

 

2,010,349

 

2,051,655

 

 

 

 

 

 

 

Total portfolio investments (cost: $362,001,581 and $322,855,578 as of March 31, 2011 and December 31, 2010, respectively)

 

392,526,455

 

348,811,074

 

Marketable securities and idle funds investments (cost: $97,854,377 and $67,970,907 as of March 31, 2011 and December 31, 2010, respectively)

 

98,751,072

 

68,752,858

 

 

 

 

 

 

 

Total investments (cost: $459,855,958 and $390,826,485 as of March 31, 2011 and December 31, 2010, respectively)

 

491,277,527

 

417,563,932

 

 

 

 

 

 

 

Cash and cash equivalents

 

29,064,271

 

22,334,340

 

Deferred tax asset

 

808,186

 

1,958,593

 

Interest receivable and other assets

 

5,180,003

 

4,523,792

 

Deferred financing costs (net of accumulated amortization of $1,650,229 and $1,504,584 as of March 31, 2011 and December 31, 2010, respectively)

 

3,485,980

 

2,543,645

 

 

 

 

 

 

 

Total assets

 

$

529,815,967

 

$

448,924,302

 

 

 

 

 

 

 

LIABILITIES

 

 

 

 

 

 

 

 

 

 

 

SBIC debentures (par: $210,000,000 and $180,000,000 as of March 31, 2011 and December 31, 2010, respectively; of which $70,519,343 and $70,557,975 are recorded at fair value as of March 31, 2011 and December 31, 2010, respectively)

 

$

185,519,343

 

$

155,557,975

 

Credit facility

 

15,000,000

 

39,000,000

 

Interest payable

 

862,547

 

3,194,870

 

Dividend payable

 

2,183,176

 

 

Payable to affiliated Investment Manager

 

1,168,697

 

15,124

 

Accounts payable and other liabilities

 

1,731,819

 

1,173,295

 

 

 

 

 

 

 

Total liabilities

 

206,465,582

 

198,941,264

 

Commitments and contingencies

 

 

 

 

 

 

 

 

 

 

 

NET ASSETS

 

 

 

 

 

 

 

 

 

 

 

Common stock, $0.01 par value per share (150,000,000 shares authorized; 22,947,566 and 18,797,444 issued and outstanding as of March 31, 2011 and December 31, 2010, respectively)

 

229,476

 

187,975

 

Additional paid-in capital

 

297,646,519

 

224,485,165

 

Accumulated net investment income

 

6,605,872

 

9,261,405

 

Accumulated net realized loss from investments

 

(20,541,897

)

(20,541,897

)

Net unrealized appreciation, net of income taxes

 

35,072,245

 

32,141,997

 

 

 

 

 

 

 

Total Net Asset Value

 

319,012,215

 

245,534,645

 

 

 

 

 

 

 

Noncontrolling interest

 

4,338,170

 

4,448,393

 

 

 

 

 

 

 

Total net assets including noncontrolling interests

 

323,350,385

 

249,983,038

 

 

 

 

 

 

 

Total liabilities and net assets

 

$

529,815,967

 

$

448,924,302

 

 

 

 

 

 

 

NET ASSET VALUE PER SHARE

 

$

13.90

 

$

13.06

 

 

The accompanying notes are an integral part of these financial statements

 

1



Table of Contents

 

MAIN STREET CAPITAL CORPORATION

Consolidated Statements of Operations

(Unaudited)

 

 

 

Three Months Ended March 31,

 

 

 

2011

 

2010

 

 

 

 

 

 

 

INVESTMENT INCOME:

 

 

 

 

 

Interest, fee and dividend income:

 

 

 

 

 

Control investments

 

$

5,649,762

 

$

3,595,308

 

Affiliate investments

 

2,146,419

 

1,808,613

 

Non-Control/Non-Affiliate investments

 

3,331,109

 

863,396

 

Total interest, fee and dividend income

 

11,127,290

 

6,267,317

 

Interest from marketable securities, idle funds and other

 

2,247,282

 

825,522

 

Total investment income

 

13,374,572

 

7,092,839

 

EXPENSES:

 

 

 

 

 

Interest

 

(2,902,205

)

(1,993,237

)

General and administrative

 

(507,182

)

(425,704

)

Expenses reimbursed to affiliated Investment Manager

 

(2,129,806

)

(1,152,187

)

Share-based compensation

 

(442,897

)

(301,458

)

Total expenses

 

(5,982,090

)

(3,872,586

)

NET INVESTMENT INCOME

 

7,392,482

 

3,220,253

 

 

 

 

 

 

 

NET REALIZED GAIN (LOSS) FROM INVESTMENTS:

 

 

 

 

 

Control investments

 

 

(4,020,918

)

Marketable securities and idle funds investments

 

 

(39,539

)

Total net realized gain (loss) from investments

 

 

(4,060,457

)

NET REALIZED INCOME (LOSS)

 

7,392,482

 

(840,204

)

 

 

 

 

 

 

NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION):

 

 

 

 

 

Portfolio investments

 

4,018,584

 

5,114,659

 

Marketable securities and idle funds investments

 

114,743

 

253,304

 

SBIC debentures

 

38,632

 

281,193

 

Investment in affiliated Investment Manager

 

(41,306

)

(145,079

)

Total net change in unrealized appreciation

 

4,130,653

 

5,504,077

 

 

 

 

 

 

 

Income tax provision

 

(1,200,405

)

(384,574

)

Bargain purchase gain

 

 

4,890,582

 

NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS

 

10,322,730

 

9,169,881

 

Noncontrolling interest

 

 

(113,336

)

NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS ATTRIBUTABLE TO COMMON STOCK

 

$

10,322,730

 

$

9,056,545

 

 

 

 

 

 

 

NET INVESTMENT INCOME PER SHARE - BASIC AND DILUTED

 

$

0.38

 

$

0.22

 

NET REALIZED INCOME (LOSS) PER SHARE - BASIC AND DILUTED

 

$

0.38

 

$

(0.06

)

NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS ATTRIBUTABLE TO COMMON STOCK PER SHARE - BASIC AND DILUTED

 

$

0.54

 

$

0.63

 

DIVIDENDS PAID PER SHARE

 

$

0.38

 

$

0.38

 

WEIGHTED AVERAGE SHARES OUTSTANDING - BASIC AND DILUTED

 

19,217,690

 

14,356,785

 

 

The accompanying notes are an integral part of these financial statements

 

2



Table of Contents

 

MAIN STREET CAPITAL CORPORATION

Consolidated Statements of Changes in Net Assets

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Unrealized

 

 

 

 

 

Total Net

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

Appreciation from

 

 

 

 

 

Assets

 

 

 

Common Stock

 

Additional

 

Accumulated

 

Net Realized

 

Investments,

 

 

 

 

 

Including

 

 

 

Number

 

Par

 

Paid-In

 

Net Investment

 

Loss

 

Net of Income

 

Total Net

 

Noncontrolling

 

Noncontrolling

 

 

 

of Shares

 

Value

 

Capital

 

Income

 

From Investments

 

Taxes

 

Asset Value

 

Interest

 

Interest

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balances at December 31, 2009

 

10,842,447

 

$

108,425

 

$

123,534,156

 

$

7,269,866

 

$

(15,922,020

)

$

14,669,704

 

$

129,660,131

 

$

 

$

129,660,131

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

MSC II exchange offer and related transactions

 

1,239,695

 

12,397

 

19,921,899

 

4,890,582

 

 

 

24,824,878

 

3,396,005

 

28,220,883

 

Public offering of common stock, net of offering costs

 

2,875,000

 

28,750

 

40,127,248

 

 

 

 

40,155,998

 

 

40,155,998

 

Share-based compensation

 

 

 

301,458

 

 

 

 

301,458

 

 

301,458

 

Dividend reinvestment

 

125,600

 

1,255

 

1,848,073

 

 

 

 

1,849,328

 

 

1,849,328

 

Adjustment to investment in Investment Manager related to the MSC II Exchange Offer

 

 

 

(13,715,958

)

 

 

 

(13,715,958

)

 

(13,715,958

)

Dividends to stockholders

 

 

 

 

(6,993,777

)

 

 

(6,993,777

)

 

(6,993,777

)

Net increase resulting from operations

 

 

 

 

3,220,253

 

(4,060,457

)

5,119,503

 

4,279,299

 

 

4,279,299

 

Noncontrolling interest

 

 

 

 

 

 

(113,336

)

(113,336

)

113,336

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balances at March 31, 2010

 

15,082,742

 

$

150,827

 

$

172,016,876

 

$

8,386,924

 

$

(19,982,477

)

$

19,675,871

 

$

180,248,021

 

$

3,509,341

 

$

183,757,362

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balances at December 31, 2010

 

18,797,444

 

$

187,975

 

$

224,485,165

 

$

9,261,405

 

$

(20,541,897

)

$

32,141,997

 

$

245,534,645

 

$

4,448,393

 

$

249,983,038

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Public offering of common stock, net of offering costs

 

4,025,000

 

40,250

 

70,309,656

 

 

 

 

70,349,906

 

 

70,349,906

 

Share-based compensation

 

 

 

442,897

 

 

 

 

442,897

 

 

442,897

 

Dividend reinvestment

 

125,122

 

1,251

 

2,408,801

 

 

 

 

2,410,052

 

 

2,410,052

 

Distributions to noncontrolling interest

 

 

 

 

 

 

 

 

(110,223

)

(110,223

)

Dividends to stockholders

 

 

 

 

(10,048,015

)

 

 

(10,048,015

)

 

(10,048,015

)

Net increase resulting from operations

 

 

 

 

7,392,482

 

 

2,930,248

 

10,322,730

 

 

10,322,730

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balances at March 31, 2011

 

22,947,566

 

$

229,476

 

$

297,646,519

 

$

6,605,872

 

$

(20,541,897

)

$

35,072,245

 

$

319,012,215

 

$

4,338,170

 

$

323,350,385

 

 

The accompanying notes are an integral part of these financial statements

 

3



Table of Contents

 

MAIN STREET CAPITAL CORPORATION

Consolidated Statements of Cash Flows

(Unaudited)

 

 

 

Three Months Ended March 31,

 

 

 

2011

 

2010

 

CASH FLOWS FROM OPERATING ACTIVITIES

 

 

 

 

 

Net increase in net assets resulting from operations

 

$

10,322,730

 

$

9,169,881

 

Adjustments to reconcile net increase in net assets resulting from operations to net cash provided by operating activities:

 

 

 

 

 

Net change in unrealized appreciation

 

(4,130,653

)

(5,504,077

)

Net realized loss from investments

 

 

4,060,457

 

Bargain purchase gain

 

 

(4,890,582

)

Accretion of unearned income

 

(1,556,366

)

(596,182

)

Net payment-in-kind interest accrual 

 

(946,888

)

(201,775

)

Share-based compensation expense

 

442,897

 

301,458

 

Amortization of deferred financing costs

 

145,645

 

97,688

 

Deferred taxes

 

1,150,407

 

301,992

 

Changes in other assets and liabilities:

 

 

 

 

 

Interest receivable and other assets

 

(1,206,211

)

(835,521

)

Interest payable

 

(2,332,323

)

(1,776,121

)

Payable to affiliated Investment Manager

 

1,153,573

 

12,060

 

Accounts payable and other liabilities

 

558,524

 

(38,199

)

Deferred fees and other

 

524,000

 

73,140

 

Net cash provided by operating activities

 

4,125,335

 

174,219

 

 

 

 

 

 

 

CASH FLOWS FROM INVESTING ACTIVITIES

 

 

 

 

 

Investments in portfolio companies

 

(43,949,652

)

(18,528,902

)

Cash acquired in MSC II exchange offer

 

 

2,489,920

 

Investments in marketable securities and idle funds investments

 

(39,349,266

)

(25,939,696

)

Proceeds from marketable securities and idle funds investments

 

10,103,821

 

3,596,689

 

Principal payments received on loans and debt securities

 

6,102,777

 

1,266,386

 

Net cash used in investing activities

 

(67,092,320

)

(37,115,603

)

 

 

 

 

 

 

CASH FLOWS FROM FINANCING ACTIVITIES

 

 

 

 

 

Proceeds from public offering of common stock, net of offering costs

 

70,349,906

 

40,155,998

 

Distributions to noncontrolling interest

 

(110,223

)

 

Dividends paid to stockholders

 

(4,654,787

)

(3,259,120

)

Net change in DRIP deposit

 

(800,000

)

 

Proceeds from issuance of SBIC debentures

 

30,000,000

 

 

Proceeds from credit facility

 

41,000,000

 

18,150,000

 

Repayments on credit facility

 

(65,000,000

)

(16,050,000

)

Payment of deferred loan costs and SBIC debenture fees

 

(1,087,980

)

(10,310

)

Net cash provided by financing activities

 

69,696,916

 

38,986,568

 

 

 

 

 

 

 

Net increase in cash and cash equivalents

 

6,729,931

 

2,045,184

 

CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD

 

22,334,340

 

30,619,998

 

CASH AND CASH EQUIVALENTS AT END OF PERIOD

 

$

29,064,271

 

$

32,665,182

 

 

The accompanying notes are an integral part of these financial statements

 

4



Table of Contents

 

MAIN STREET CAPITAL CORPORATION

CONSOLIDATED SCHEDULE OF INVESTMENTS

March 31, 2011

(Unaudited)

 

Portfolio Company/Type of Investment (1) (2)

 

Industry

 

Principal (6)

 

Cost (6)

 

Fair Value

 

 

 

 

 

 

 

 

 

 

 

Control Investments (3)

 

 

 

 

 

 

 

 

 

Café Brazil, LLC

 

Casual Restaurant Group

 

 

 

 

 

 

 

12% Secured Debt (Maturity - April 20, 2013)

 

 

 

1,900,000

 

1,897,680

 

1,900,000

 

Member Units (7) (Fully diluted 41.0%)

 

 

 

 

 

41,837

 

2,470,000

 

 

 

 

 

 

 

1,939,517

 

4,370,000

 

 

 

 

 

 

 

 

 

 

 

California Healthcare Medical Billing, Inc.

 

Healthcare Billing and Records Management

 

 

 

 

 

 

 

12% Secured Debt (Maturity - October 17, 2015)

 

 

 

7,303,000

 

6,908,889

 

7,222,715

 

Warrants (Fully diluted 20.4%)

 

 

 

 

 

1,193,333

 

3,380,333

 

Common Stock (Fully diluted 9.7%)

 

 

 

 

 

1,176,667

 

1,390,000

 

 

 

 

 

 

 

9,278,889

 

11,993,048

 

 

 

 

 

 

 

 

 

 

 

CBT Nuggets, LLC

 

Produces and Sells IT Certification Training Videos

 

 

 

 

 

 

 

10% Secured Debt (Maturity - March 31, 2012)

 

 

 

375,000

 

375,000

 

375,000

 

14% Secured Debt (Maturity - December 31, 2013)

 

 

 

2,800,000

 

2,794,927

 

2,794,927

 

Member Units (7) (Fully diluted 40.8%)

 

 

 

 

 

1,299,520

 

3,870,000

 

 

 

 

 

 

 

4,469,447

 

7,039,927

 

 

 

 

 

 

 

 

 

 

 

Ceres Management, LLC (Lambs)

 

Aftermarket Automotive Services Chain

 

 

 

 

 

 

 

14% Secured Debt (Maturity - May 31, 2013)

 

 

 

4,000,000

 

3,967,689

 

3,967,689

 

9.5% Secured Debt (Lamb’s Real Estate Investment I, LLC) (Maturity - August 31, 2014)

 

 

 

1,225,000

 

1,225,000

 

1,225,000

 

Class B Member Units (7) (15% cumulative) (Non-voting)

 

 

 

 

 

2,173,204

 

2,173,204

 

Member Units (Fully diluted 70%)

 

 

 

 

 

1,813,333

 

860,000

 

Member Units (7) (Lamb’s Real Estate Investment I, LLC) (Fully diluted 100%)

 

 

 

 

 

625,000

 

625,000

 

 

 

 

 

 

 

9,804,226

 

8,850,893

 

 

 

 

 

 

 

 

 

 

 

Condit Exhibits, LLC

 

Tradeshow Exhibits / Custom Displays

 

 

 

 

 

 

 

9% Current / 9% PIK Secured Debt (Maturity - July 1, 2013)

 

 

 

4,660,948

 

4,622,987

 

4,622,987

 

Warrants (Fully diluted 47.9%)

 

 

 

 

 

320,000

 

100,000

 

 

 

 

 

 

 

4,942,987

 

4,722,987

 

 

 

 

 

 

 

 

 

 

 

Currie Acquisitions, LLC

 

Consumer Products

 

 

 

 

 

 

 

12% Secured Debt (Maturity - March 1, 2015)

 

 

 

4,750,000

 

4,004,722

 

4,004,722

 

Warrants (Fully diluted 47.3%)

 

 

 

 

 

2,566,204

 

2,050,204

 

 

 

 

 

 

 

6,570,926

 

6,054,926

 

 

 

 

 

 

 

 

 

 

 

Gulf Manufacturing, LLC

 

Industrial Metal Fabrication

 

 

 

 

 

 

 

8% Secured Debt (Maturity - August 31, 2014)

 

 

 

3,620,000

 

3,620,000

 

3,620,000

 

13% Secured Debt (Maturity - August 31, 2014)

 

 

 

1,680,000

 

1,619,597

 

1,641,017

 

9% PIK Secured Debt (Maturity - June 30, 2017)

 

 

 

1,420,784

 

1,420,784

 

1,420,784

 

Member Units (7) (Fully diluted 34.2%)

 

 

 

 

 

2,979,813

 

6,890,000

 

 

 

 

 

 

 

9,640,194

 

13,571,801

 

 

 

 

 

 

 

 

 

 

 

Harrison Hydra-Gen, Ltd.

 

Manufacturer of Hydraulic Generators

 

 

 

 

 

 

 

12% Secured Debt (Maturity - June 4, 2015)

 

 

 

6,000,000

 

5,284,650

 

5,284,650

 

Preferred stock (7) (8% cumulative)

 

 

 

 

 

1,020,000

 

1,020,000

 

Warrants (Fully diluted 35.2%)

 

 

 

 

 

717,640

 

717,640

 

 

 

 

 

 

 

7,022,290

 

7,022,290

 

 

 

 

 

 

 

 

 

 

 

Hawthorne Customs & Dispatch Services, LLC

 

Transportation/ Logistics

 

 

 

 

 

 

 

Member Units (7) (Fully diluted 59.1%)

 

 

 

 

 

692,500

 

1,250,000

 

Member Units (Wallisville Real Estate, LLC) (7) (Fully diluted 59.1%)

 

 

 

 

 

1,214,784

 

1,214,784

 

 

 

 

 

 

 

1,907,284

 

2,464,784

 

 

 

 

 

 

 

 

 

 

 

Hydratec, Inc.

 

Agricultural Services

 

 

 

 

 

 

 

Common Stock (Fully diluted 92.5%)

 

 

 

 

 

7,088,911

 

10,163,911

 

 

 

 

 

 

 

 

 

 

 

Indianapolis Aviation Partners, LLC

 

FBO / Aviation Support Services

 

 

 

 

 

 

 

12% Secured Debt (Maturity - September 15, 2014)

 

 

 

4,500,000

 

4,158,875

 

4,350,000

 

Warrants (Fully diluted 30.1%)

 

 

 

 

 

1,129,286

 

1,270,286

 

 

 

 

 

 

 

5,288,161

 

5,620,286

 

 

5



Table of Contents

 

MAIN STREET CAPITAL CORPORATION

CONSOLIDATED SCHEDULE OF INVESTMENTS

March 31, 2011

(Unaudited)

 

Portfolio Company/Type of Investment (1) (2)

 

Industry

 

Principal (6)

 

Cost (6)

 

Fair Value

 

 

 

 

 

 

 

 

 

 

 

Control Investments (3)

 

 

 

 

 

 

 

 

 

Jensen Jewelers of Idaho, LLC

 

Retail Jewelry

 

 

 

 

 

 

 

Prime Plus 2% Secured Debt (Maturity - November 14, 2011)

 

 

 

2,260,000

 

2,257,523

 

2,260,000

 

13% Current / 6% PIK Secured Debt (Maturity - November 14, 2011)

 

 

 

2,344,897

 

2,341,580

 

2,344,897

 

Member Units (7)  (Fully diluted 60.8%)

 

 

 

 

 

811,000

 

1,410,000

 

 

 

 

 

 

 

5,410,103

 

6,014,897

 

 

 

 

 

 

 

 

 

 

 

Mid-Columbia Lumber Products, LLC

 

Specialized Lumber Products

 

 

 

 

 

 

 

10% Secured Debt (Maturity - April 1, 2012)

 

 

 

1,250,000

 

1,250,000

 

1,250,000

 

12% Secured Debt (Maturity - December 18, 2011)

 

 

 

3,900,000

 

3,855,995

 

3,900,000

 

9.5% Secured Debt (Mid - Columbia Real Estate, LLC) (Maturity - May 13, 2025)

 

 

 

1,096,100

 

1,096,100

 

1,096,100

 

Warrants (Fully diluted 25.5%)

 

 

 

 

 

250,000

 

670,000

 

Member Units (Fully diluted 26.7%)

 

 

 

 

 

500,000

 

700,000

 

Member Units (Mid - Columbia Real Estate, LLC) (Fully diluted 50.0%)

 

 

 

 

 

250,000

 

250,000

 

 

 

 

 

 

 

7,202,095

 

7,866,100

 

 

 

 

 

 

 

 

 

 

 

NAPCO Precast, LLC

 

Precast Concrete Manufacturing

 

 

 

 

 

 

 

18% Secured Debt (Maturity - February 1, 2013)

 

 

 

5,923,077

 

5,866,633

 

5,923,077

 

Prime Plus 2% Secured Debt (Maturity - February 1, 2013) (8)

 

 

 

3,384,615

 

3,370,363

 

3,384,615

 

Member Units (7) (Fully diluted 35.3%)

 

 

 

 

 

2,020,000

 

4,230,000

 

 

 

 

 

 

 

11,256,996

 

13,537,692

 

 

 

 

 

 

 

 

 

 

 

NTS Holdings, Inc.

 

Trench & Traffic Safety Equipment

 

 

 

 

 

 

 

12% Secured Debt (Maturity - April 30, 2015)

 

 

 

6,000,000

 

5,965,537

 

5,965,537

 

Preferred stock (7) (12% cumulative)

 

 

 

 

 

10,936,831

 

10,936,831

 

Common Stock (7) (Fully diluted 72.3%)

 

 

 

 

 

1,621,255

 

776,000

 

 

 

 

 

 

 

18,523,623

 

17,678,368

 

 

 

 

 

 

 

 

 

 

 

OMi Holdings, Inc.

 

Manufacturer of Overhead Cranes

 

 

 

 

 

 

 

12% Secured Debt (Maturity - April 1, 2013)

 

 

 

9,970,000

 

9,923,076

 

9,923,076

 

Common Stock (Fully diluted 48.0%)

 

 

 

 

 

1,080,000

 

560,000

 

 

 

 

 

 

 

11,003,076

 

10,483,076

 

 

 

 

 

 

 

 

 

 

 

Pegasus Research Group, LLC (Televerde)

 

Telemarketing and Data Services

 

 

 

 

 

 

 

13% Current / 3% PIK Secured Debt (Maturity - January 6, 2016)

 

 

 

6,294,271

 

6,210,552

 

6,210,552

 

Member Units (7) (Fully diluted 43.7%)

 

 

 

 

 

1,250,000

 

1,250,000

 

 

 

 

 

 

 

7,460,552

 

7,460,552

 

 

 

 

 

 

 

 

 

 

 

PPL RVs, Inc.

 

Recreational Vehicle Parts and Consignment

 

 

 

 

 

 

 

18% Secured Debt (Maturity - June 10, 2015)

 

 

 

6,250,000

 

6,168,168

 

6,168,168

 

Member Units (Fully diluted 50.1%)

 

 

 

 

 

2,150,000

 

2,280,000

 

 

 

 

 

 

 

8,318,168

 

8,448,168

 

 

 

 

 

 

 

 

 

 

 

Principle Environmental, LLC

 

Noise Abatement Products/Services

 

 

 

 

 

 

 

12% Secured Debt (Maturity - February 1, 2016)

 

 

 

5,500,000

 

4,228,966

 

4,228,966

 

Warrants (Fully diluted 15%)

 

 

 

 

 

1,200,000

 

1,200,000

 

Member Units (7) (Fully diluted 25%)

 

 

 

 

 

2,000,000

 

2,000,000

 

 

 

 

 

 

 

7,428,966

 

7,428,966

 

 

 

 

 

 

 

 

 

 

 

River Aggregates, LLC

 

Construction Aggregates

 

 

 

 

 

 

 

12% Secured Debt (Maturity - March 30, 2016)

 

 

 

3,500,000

 

3,307,500

 

3,307,500

 

Warrants (Fully diluted 10%)

 

 

 

 

 

122,500

 

122,500

 

Member Units (7) (Fully diluted 45%)

 

 

 

 

 

550,000

 

550,000

 

 

 

 

 

 

 

3,980,000

 

3,980,000

 

 

 

 

 

 

 

 

 

 

 

The MPI Group, LLC

 

Manufacturer of Custom Hollow Metal Doors, Frames and Accessories

 

 

 

 

 

 

 

4.5% Current / 4.5% PIK Secured Debt (Maturity — October 2, 2013)

 

 

 

513,250

 

507,320

 

507,320

 

6% Current / 6% PIK Secured Debt (Maturity — October 2, 2013)

 

 

 

5,176,667

 

5,023,558

 

5,023,558

 

Warrants (Fully diluted 47.1%)

 

 

 

 

 

895,943

 

190,000

 

 

 

 

 

 

 

6,426,821

 

5,720,878

 

 

6



Table of Contents

 

MAIN STREET CAPITAL CORPORATION

CONSOLIDATED SCHEDULE OF INVESTMENTS

March 31, 2011

(Unaudited)

 

Portfolio Company/Type of Investment (1) (2)

 

Industry

 

Principal (6)

 

Cost (6)

 

Fair Value

 

 

 

 

 

 

 

 

 

 

 

Control Investments (3)

 

 

 

 

 

 

 

 

 

Thermal & Mechanical Equipment, LLC

 

Heat Exchange / Filtration Products and Services

 

 

 

 

 

 

 

Prime Plus 2% Secured Debt (Maturity - September 25, 2014) (8)

 

 

 

1,415,540

 

1,407,261

 

1,407,261

 

13% Current / 5% PIK Secured Debt (Maturity - September 25, 2014)

 

 

 

4,509,680

 

4,452,583

 

4,509,680

 

Member Units (Fully diluted 50.0%)

 

 

 

 

 

1,000,000

 

2,680,000

 

 

 

 

 

 

 

6,859,844

 

8,596,941

 

 

 

 

 

 

 

 

 

 

 

Uvalco Supply, LLC

 

Farm and Ranch Supply

 

 

 

 

 

 

 

Member Units (Fully diluted 42.8%) (7)

 

 

 

 

 

1,113,243

 

1,940,000

 

 

 

 

 

 

 

 

 

 

 

Van Gilder Insurance Corporation

 

Manufacturer/Installer of Commercial Signage

 

 

 

 

 

 

 

8% Secured Debt (Maturity - January 31, 2016)

 

 

 

1,972,336

 

1,943,632

 

1,943,632

 

13% Secured Debt (Maturity - January 31, 2016)

 

 

 

6,150,000

 

4,864,029

 

4,864,029

 

Warrants (Fully diluted 10%)

 

 

 

 

 

1,208,643

 

1,208,643

 

Common Stock (Fully diluted 15.51%)

 

 

 

 

 

2,499,876

 

2,499,876

 

 

 

 

 

 

 

10,516,180

 

10,516,180

 

 

 

 

 

 

 

 

 

 

 

Vision Interests, Inc.

 

Manufacturer/Installer of Commercial Signage

 

 

 

 

 

 

 

6.5% Current /6.5% PIK Secured Debt (Maturity - June 5, 2012)

 

 

 

9,400,000

 

8,424,811

 

6,322,651

 

6.5% Current /6.5% PIK Secured Debt (Maturity - June 5, 2016)

 

 

 

760,000

 

740,587

 

740,587

 

Warrants (Fully diluted 38.2%)

 

 

 

 

 

160,010

 

 

Common Stock (Fully diluted 22.3%)

 

 

 

 

 

372,000

 

 

 

 

 

 

 

 

9,697,408

 

7,063,238

 

 

 

 

 

 

 

 

 

 

 

Ziegler’s NYPD, LLC

 

Casual Restaurant Group

 

 

 

 

 

 

 

Prime Plus 2% Secured Debt (Maturity - October 1, 2013) (8)

 

 

 

1,000,000

 

994,427

 

994,427

 

13% Current / 5% PIK Secured Debt (Maturity - October 1, 2013)

 

 

 

4,862,083

 

4,815,915

 

4,815,915

 

Warrants (Fully diluted 46.6%)

 

 

 

 

 

600,000

 

470,000

 

 

 

 

 

 

 

6,410,342

 

6,280,342

 

 

 

 

 

 

 

 

 

 

 

Subtotal Control Investments

 

 

 

 

 

189,560,249

 

204,890,251

 

 

7



Table of Contents

 

MAIN STREET CAPITAL CORPORATION

CONSOLIDATED SCHEDULE OF INVESTMENTS

March 31, 2011

(Unaudited)

 

Portfolio Company/Type of Investment (1) (2)

 

Industry

 

Principal (6)

 

Cost (6)

 

Fair Value

 

 

 

 

 

 

 

 

 

 

 

Affiliate Investments (4)

 

 

 

 

 

 

 

 

 

American Sensor Technologies, Inc.

 

Manufacturer of Commercial/Industrial Sensors

 

 

 

 

 

 

 

9% Secured Debt (Maturity - May 31, 2012)

 

 

 

3,547,783

 

3,529,283

 

3,529,283

 

Warrants (Fully diluted 19.6%)

 

 

 

 

 

49,990

 

2,080,000

 

 

 

 

 

 

 

3,579,273

 

5,609,283

 

 

 

 

 

 

 

 

 

 

 

Audio Messaging Solutions, LLC

 

Audio Messaging Services

 

 

 

 

 

 

 

12% Secured Debt (Maturity - May 8, 2014)

 

 

 

7,644,000

 

7,322,388

 

7,371,597

 

Warrants (Fully diluted 8.4%)

 

 

 

 

 

468,373

 

1,280,000

 

 

 

 

 

 

 

7,790,761

 

8,651,597

 

 

 

 

 

 

 

 

 

 

 

Compact Power Equipment Centers LLC

 

Light to Medium Duty Equipment Rental

 

 

 

 

 

 

 

6% Current / 6% PIK Secured Debt (Maturity - December 30, 2014)

 

 

 

2,727,564

 

2,700,572

 

2,700,572

 

Series A Member Units (7) (8% cumulative) (Non-voting)

 

 

 

 

 

793,651

 

793,651

 

Member Units (Fully diluted 11.5%)

 

 

 

 

 

1,147

 

1,147

 

 

 

 

 

 

 

3,495,370

 

3,495,370

 

 

 

 

 

 

 

 

 

 

 

DrillingInfo, Inc.

 

Information Services for the Oil and Gas Industry

 

 

 

 

 

 

 

12% Secured Debt (Maturity - November 20, 2014)

 

 

 

8,000,000

 

6,887,024

 

7,770,000

 

Warrants (Fully diluted 5.0%)

 

 

 

 

 

1,250,000

 

4,510,000

 

Common Stock (Fully diluted 2.1%)

 

 

 

 

 

1,085,325

 

2,070,325

 

 

 

 

 

 

 

9,222,349

 

14,350,325

 

 

 

 

 

 

 

 

 

 

 

East Teak Fine Hardwoods, Inc.

 

Hardwood Products

 

 

 

 

 

 

 

Common Stock (Fully diluted 5.0%)

 

 

 

 

 

480,318

 

330,000

 

 

 

 

 

 

 

 

 

 

 

Houston Plating & Coatings, LLC

 

Plating & Industrial Coating Services

 

 

 

 

 

 

 

Prime Plus 2% Debt (Maturity - July 18, 2013)

 

 

 

300,000

 

300,000

 

300,000

 

Member Units (7) (Fully diluted 11.1%)

 

 

 

 

 

335,000

 

3,205,000

 

 

 

 

 

 

 

635,000

 

3,505,000

 

 

 

 

 

 

 

 

 

 

 

IRTH Holdings, LLC

 

Utility Technology Services

 

 

 

 

 

 

 

12% Secured Debt (Maturity - December 29, 2015)

 

 

 

6,000,000

 

5,895,114

 

5,895,114

 

Member Units (Fully diluted 22.3%)

 

 

 

 

 

850,000

 

850,000

 

 

 

 

 

 

 

6,745,114

 

6,745,114

 

 

 

 

 

 

 

 

 

 

 

KBK Industries, LLC

 

Specialty Manufacturer of Oilfield and Industrial Products

 

 

 

 

 

 

 

14% Secured Debt (Maturity - January 23, 2014)

 

 

 

5,250,000

 

5,250,000

 

5,250,000

 

10% Secured Debt (Maturity - March 31, 2012)

 

 

 

389,940

 

389,940

 

389,940

 

Member Units (7) (Fully diluted 18.8%)

 

 

 

 

 

340,833

 

2,010,333

 

 

 

 

 

 

 

5,980,773

 

7,650,273

 

 

 

 

 

 

 

 

 

 

 

Laurus Healthcare, LP

 

Healthcare Facilities / Services

 

 

 

 

 

 

 

10% Secured Debt (Maturity - December 31, 2011)

 

 

 

750,000

 

750,000

 

750,000

 

13% Secured Debt (Maturity - December 31, 2011)

 

 

 

350,000

 

350,000

 

350,000

 

13% Secured Debt (Maturity -May 7, 2012)

 

 

 

2,275,000

 

2,275,000

 

2,275,000

 

Class A and C Units (7) (Fully diluted 13.1%)

 

 

 

 

 

79,505

 

5,070,000

 

 

 

 

 

 

 

3,454,505

 

8,445,000

 

 

 

 

 

 

 

 

 

 

 

Lighting Unlimited, LLC

 

Commercial and Residential Lighting Products and Design Services

 

 

 

 

 

 

 

Prime Plus 1% Secured Debt (Maturity - August 22, 2012) (8)

 

 

 

849,996

 

847,314

 

847,314

 

14% Secured Debt (Maturity - August 22, 2012)

 

 

 

1,760,101

 

1,728,285

 

1,478,285

 

Warrants (Fully diluted 17.0%)

 

 

 

 

 

54,000

 

 

 

 

 

 

 

 

2,629,599

 

2,325,599

 

 

 

 

 

 

 

 

 

 

 

Merrick Systems, Inc.

 

Software and Information Technology

 

 

 

 

 

 

 

13% Secured Debt (Maturity - May 5, 2015)

 

 

 

3,000,000

 

2,558,765

 

2,558,765

 

Warrants (Fully diluted 6.5%)

 

 

 

 

 

450,000

 

650,000

 

 

 

 

 

 

 

3,008,765

 

3,208,765

 

 

8



Table of Contents

 

MAIN STREET CAPITAL CORPORATION

CONSOLIDATED SCHEDULE OF INVESTMENTS

March 31, 2011

(Unaudited)

 

Portfolio Company/Type of Investment (1) (2)

 

Industry

 

Principal (6)

 

Cost (6)

 

Fair Value

 

 

 

 

 

 

 

 

 

 

 

Affiliate Investments (4)

 

 

 

 

 

 

 

 

 

Olympus Building Services, Inc.

 

Custodial/Facilities Services

 

 

 

 

 

 

 

12% Secured Debt (Maturity - March 27, 2014)

 

 

 

3,150,000

 

2,938,384

 

3,050,000

 

12% Current / 3% PIK Secured Debt (Maturity - March 27, 2014)

 

 

 

991,380

 

991,381

 

991,381

 

Warrants (Fully diluted 22.5%)

 

 

 

 

 

470,000

 

930,000

 

 

 

 

 

 

 

4,399,765

 

4,971,381

 

 

 

 

 

 

 

 

 

 

 

OPI International Ltd.

 

Oil and Gas Construction Services

 

 

 

 

 

 

 

12% Secured Debt (Maturity - November 30, 2015)

 

 

 

11,000,000

 

10,804,330

 

10,804,330

 

12% Secured Debt (Maturity - November 30, 2015)

 

 

 

750,000

 

252,288

 

252,288

 

Common Stock (Fully diluted 8.0%)

 

 

 

 

 

500,000

 

500,000

 

 

 

 

 

 

 

11,556,618

 

11,556,618

 

 

 

 

 

 

 

 

 

 

 

Schneider Sales Management, LLC

 

Sales Consulting and Training

 

 

 

 

 

 

 

13% Secured Debt (Maturity - October 15, 2013)

 

 

 

3,367,542

 

3,289,127

 

500,000

 

Warrants (Fully diluted 20.0%)

 

 

 

 

 

45,000

 

 

 

 

 

 

 

 

3,334,127

 

500,000

 

 

 

 

 

 

 

 

 

 

 

Walden Smokey Point, Inc.

 

Specialty Transportation

 

 

 

 

 

 

 

Common Stock (Fully diluted 12.6%)

 

 

 

 

 

1,426,667

 

2,820,000

 

 

 

 

 

 

 

 

 

 

 

WorldCall, Inc.

 

Telecommunication/Information Services

 

 

 

 

 

 

 

13% Secured Debt (Maturity - April 22, 2011)

 

 

 

646,225

 

646,225

 

646,225

 

Common Stock (Fully diluted 10%)

 

 

 

 

 

296,631

 

 

 

 

 

 

 

 

942,856

 

646,225

 

 

 

 

 

 

 

 

 

 

 

Subtotal Affiliate Investments

 

 

 

 

 

68,681,860

 

84,810,550

 

 

9



Table of Contents

 

MAIN STREET CAPITAL CORPORATION

CONSOLIDATED SCHEDULE OF INVESTMENTS

March 31, 2011

(Unaudited)

 

Portfolio Company/Type of Investment (1) (2)

 

Industry

 

Principal (6)

 

Cost (6)

 

Fair Value

 

 

 

 

 

 

 

 

 

 

 

Non-Control/Non-Affiliate Investments (5)

 

 

 

 

 

 

 

 

 

Affinity Videonet, Inc.

 

Videoconferencing Services

 

 

 

 

 

 

 

13% Secured Debt (Maturity - December 31, 2015)

 

 

 

2,000,000

 

1,892,383

 

1,892,383

 

13% Current / 1% PIK Secured Debt (Maturity - December 31, 2015)

 

 

 

1,700,000

 

1,695,809

 

1,695,809

 

Warrants (Fully diluted 2.5%)

 

 

 

 

 

62,500

 

62,500

 

 

 

 

 

 

 

3,650,692

 

3,650,692