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Main Street Capital CORP - Quarter Report: 2020 March (Form 10-Q)


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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 March 31, 2020

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, 8th 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)

        Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class   Trading Symbol   Name of Each Exchange on Which Registered
Common Stock, par value $0.01 per share   MAIN   New York Stock Exchange

        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 every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit 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, a smaller reporting company or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act.

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

Emerging growth company o

        If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. 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 May 7, 2020 was 64,882,949.

   

Table of Contents


TABLE OF CONTENTS

PART I
FINANCIAL INFORMATION

Item 1.

  

Consolidated Financial Statements

    

 

Consolidated Balance Sheets—March 31, 2020 (unaudited) and December 31, 2019

   1

 

Consolidated Statements of Operations (unaudited)—Three months ended March 31, 2020 and 2019

   2

 

Consolidated Statements of Changes in Net Assets (unaudited)—Three months ended March 31, 2020 and 2019

   3

 

Consolidated Statements of Cash Flows (unaudited)—Three months ended March 31, 2020 and 2019

   4

 

Consolidated Schedule of Investments (unaudited)—March 31, 2020

   5

 

Consolidated Schedule of Investments—December 31, 2019

   30

 

Notes to Consolidated Financial Statements (unaudited)

   56

 

Consolidated Schedules of Investments in and Advances to Affiliates (unaudited)—Three months ended March 31, 2020 and 2019

   98

Item 2.

  

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

   108

Item 3.

  

Quantitative and Qualitative Disclosures about Market Risk

   128

Item 4.

  

Controls and Procedures

   129


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

   132

Item 6.

  

Exhibits

   133

 

Signatures

   134

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Balance Sheets

(dollars in thousands, except shares and per share amounts)

 
   March 31,
2020 		  December 31,
2019 		 
 
   (Unaudited)
    
  

ASSETS

              

  

              

Investments at fair value:

              

Control investments (cost: $759,425 and $778,367 as of March 31, 2020 and December 31, 2019, respectively)

   $ 978,368   $ 1,032,721  

Affiliate investments (cost: $360,891 and $351,764 as of March 31, 2020 and December 31, 2019, respectively)

     318,247     330,287  

Non-Control/Non-Affiliate investments (cost: $1,270,531 and $1,297,587 as of March 31, 2020 and December 31, 2019, respectively)

     1,076,131     1,239,316  
​ ​ ​ ​ ​ ​ ​ ​

Total investments (cost: $2,390,847 and $2,427,718 as of March 31, 2020 and December 31, 2019, respectively)

     2,372,746     2,602,324  

  

              

Cash and cash equivalents

     54,188     55,246  

Interest receivable and other assets

     45,135     50,458  

Deferred financing costs (net of accumulated amortization of $7,736 and $7,501 as of March 31, 2020 and December 31, 2019, respectively)

     3,418     3,521  
​ ​ ​ ​ ​ ​ ​ ​

Total assets

   $ 2,475,487   $ 2,711,549  
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​

LIABILITIES

              

Credit facility

  
$
277,000		  
$
300,000		  

SBIC debentures (par: $304,800 ($50,000 due within one year) and $311,800 as of March 31, 2020 and December 31, 2019, respectively)

     299,146     306,188  

5.20% Notes due 2024 (par: $325,000 as of both March 31, 2020 and December 31, 2019)

     324,511     324,595  

4.50% Notes due 2022 (par: $185,000 as of both March 31, 2020 and December 31, 2019)

     183,381     183,229  

Accounts payable and other liabilities

     17,304     24,532  

Payable for securities purchased

     5,072     —  

Interest payable

     11,311     7,292  

Dividend payable

     13,218     13,174  

Deferred tax liability, net

     8,374     16,149  
​ ​ ​ ​ ​ ​ ​ ​

Total liabilities

     1,139,317     1,175,159  

Commitments and contingencies (Note K)

              

NET ASSETS

    
 		    
 		  

Common stock, $0.01 par value per share (150,000,000 shares authorized; 64,462,649 and 64,241,341 shares issued and outstanding as of March 31, 2020 and December 31, 2019, respectively)

    
645		    
643		  

Additional paid-in capital

     1,523,357     1,512,435  

Total undistributed (overdistributed) earnings

     (187,832 )   23,312  
​ ​ ​ ​ ​ ​ ​ ​

Total net assets

     1,336,170     1,536,390  
​ ​ ​ ​ ​ ​ ​ ​

Total liabilities and net assets

   $ 2,475,487   $ 2,711,549  
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​

NET ASSET VALUE PER SHARE

   $ 20.73   $ 23.91  
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​

   

The accompanying notes are an integral part of these consolidated financial statements

1

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Statements of Operations

(dollars in thousands, except shares and per share amounts)

(Unaudited)

 
   Three Months Ended March 31,  
 
   2020   2019  

INVESTMENT INCOME:

              

Interest, fee and dividend income:

              

Control investments

   $ 19,474   $ 23,691  

Affiliate investments

     8,164     9,071  

Non-Control/Non-Affiliate investments

     28,512     28,603  
​ ​ ​ ​ ​ ​ ​ ​

Total investment income

     56,150     61,365  

EXPENSES:

              

Interest

     (12,441 )   (11,916 )

Compensation

     (2,498 )   (6,069 )

General and administrative

     (3,473 )   (3,203 )

Share-based compensation

     (2,837 )   (2,329 )

Expenses allocated to the External Investment Manager

     1,644     1,643  
​ ​ ​ ​ ​ ​ ​ ​

Total expenses

     (19,605 )   (21,874 )
​ ​ ​ ​ ​ ​ ​ ​

NET INVESTMENT INCOME

     36,545     39,491  

NET REALIZED GAIN (LOSS):

    
 		    
 		  

Control investments

     (21,472 )   (187 )

Affiliate investments

     (235 )   (3,241 )

Non-Control/Non-Affiliate investments

     (158 )   (2,305 )

Realized loss on extinguishment of debt

     (534 )   (5,689 )
​ ​ ​ ​ ​ ​ ​ ​

Total net realized loss

     (22,399 )   (11,422 )
​ ​ ​ ​ ​ ​ ​ ​

NET UNREALIZED APPRECIATION (DEPRECIATION):

              

Control investments

     (35,410 )   4,946  

Affiliate investments

     (21,166 )   2,376  

Non-Control/Non-Affiliate investments

     (137,732 )   3,902  

SBIC debentures

     460     5,177  
​ ​ ​ ​ ​ ​ ​ ​

Total net unrealized appreciation (depreciation)

     (193,848 )   16,401  
​ ​ ​ ​ ​ ​ ​ ​

INCOME TAXES:

              

Federal and state income, excise and other taxes

     294     (702 )

Deferred taxes

     7,970     (2,367 )
​ ​ ​ ​ ​ ​ ​ ​

Income tax benefit (provision)

     8,264     (3,069 )
​ ​ ​ ​ ​ ​ ​ ​

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS

   $ (171,438 ) $ 41,401  
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​

NET INVESTMENT INCOME PER SHARE—BASIC AND DILUTED

   $ 0.57   $ 0.64  
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS PER SHARE—BASIC AND DILUTED

   $ (2.66 ) $ 0.67  
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​

WEIGHTED AVERAGE SHARES OUTSTANDING—BASIC AND DILUTED

     64,536,471     61,864,688  

   

The accompanying notes are an integral part of these consolidated financial statements

2

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Statements of Changes in Net Assets

(dollars in thousands, except shares)

(Unaudited)

 
   Common Stock    
    
    
  
 
    
   Total
Undistributed
(Overdistributed)
Earnings 		   
  
 
   Number
of Shares 		  Par
Value 		  Additional
Paid-In
Capital 		  Total Net
Asset Value 		 

Balances at December 31, 2018

     61,264,861   $ 613   $ 1,409,945   $ 65,491   $ 1,476,049  

Public offering of common stock, net of offering costs

    
960,684		    
9		    
35,376		    
—		    
35,385		  

Share-based compensation

     —     —     2,329     —     2,329  

Dividend reinvestment

     96,189     1     3,595     —     3,596  

Amortization of directors' deferred compensation

     —     —     216     —     216  

Issuance of restricted stock

     52,043     1     (1 )   —     —  

Dividends to stockholders

     —     —     70     (36,549 )   (36,479 )

Net increase resulting from operations

     —     —     —     41,401     41,401  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Balances at March 31, 2019

     62,373,777   $ 624   $ 1,451,530   $ 70,343   $ 1,522,497  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Balances at December 31, 2019

     64,252,937   $ 643   $ 1,512,435   $ 23,312   $ 1,536,390  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Public offering of common stock, net of offering costs

     91,458     1     3,854     —     3,855  

Share-based compensation

     —     —     2,837     —     2,837  

Purchase of vested stock for employee payroll tax withholding

     (851 )   —     (29 )   —     (29 )

Dividend reinvestment

     108,722     1     3,929     —     3,930  

Amortization of directors' deferred compensation

     —     —     238     —     238  

Issuance of restricted stock, net of forfeited shares

     10,383     —     —     —     —  

Dividends to stockholders

     —     —     93     (39,706 )   (39,613 )

Net decrease resulting from operations

     —     —     —     (171,438 )   (171,438 )
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Balances at March 31, 2020

     64,462,649   $ 645   $ 1,523,357   $ (187,832 ) $ 1,336,170  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

   

The accompanying notes are an integral part of these consolidated financial statements

3

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Statements of Cash Flows

(dollars in thousands)

 
   Three Months Ended March 31,  
 
   2020   2019  

CASH FLOWS FROM OPERATING ACTIVITIES

              

Net increase (decrease) in net assets resulting from operations

   $ (171,438 ) $ 41,401  

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

              

Investments in portfolio companies

     (138,608 )   (128,460 )

Proceeds from sales and repayments of debt investments in portfolio companies

     157,027     58,704  

Proceeds from sales and return of capital of equity investments in portfolio companies

     3,180     12,069  

Net unrealized (appreciation) depreciation

     193,848     (16,401 )

Net realized loss

     22,399     11,422  

Accretion of unearned income

     (3,583 )   (2,375 )

Payment-in-kind interest

     (591 )   (1,183 )

Cumulative dividends

     (542 )   (661 )

Share-based compensation expense

     2,837     2,329  

Amortization of deferred financing costs

     663     821  

Deferred tax (benefit) provision

     (7,970 )   2,367  

Changes in other assets and liabilities:

              

Interest receivable and other assets

     5,914     (6,478 )

Interest payable

     4,019     702  

Accounts payable and other liabilities

     (6,990 )   597  

Deferred fees and other

     1,198     584  
​ ​ ​ ​ ​ ​ ​ ​

Net cash provided by (used in) operating activities

     61,363     (24,562 )

CASH FLOWS FROM FINANCING ACTIVITIES

    
 		    
 		  

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

     3,855     35,385  

Dividends paid

     (35,639 )   (32,386 )

Proceeds from issuance of SBIC debentures

     15,000     —  

Repayments of SBIC debentures

     (22,000 )   (24,000 )

Proceeds from credit facility

     94,000     94,000  

Repayments on credit facility

     (117,000 )   (55,000 )

Payment of deferred issuance costs and SBIC debenture fees

     (608 )   (250 )

Purchases of vested stock for employee payroll tax withholding

     (29 )   —  
​ ​ ​ ​ ​ ​ ​ ​

Net cash provided by (used in) financing activities

     (62,421 )   17,749  
​ ​ ​ ​ ​ ​ ​ ​

Net decrease in cash and cash equivalents

     (1,058 )   (6,813 )

CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD

     55,246     54,181  
​ ​ ​ ​ ​ ​ ​ ​

CASH AND CASH EQUIVALENTS AT END OF PERIOD

   $ 54,188   $ 47,368  
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​

Supplemental cash flow disclosures:

              

Interest paid

   $ 7,729   $ 10,362  

Taxes paid

   $ 1,466   $ 1,340  

Operating non-cash activities:

              

Right-of-use assets obtained in exchange for operating lease liabilities

   $ 5,240   $ 5,240  

Non-cash financing activities:

              

Shares issued pursuant to the DRIP

   $ 3,930   $ 3,596  

   

The accompanying notes are an integral part of these consolidated financial statements

4

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments

March 31, 2020

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   

Control Investments(5)

      

 

  

 

                    

                               

Access Media Holdings, LLC(10)

   July 22, 2015  

Private Cable Operator

                        

         

10.00% PIK Secured Debt (Maturity—July 22, 2020)(14)(19)

   $ 23,828   $ 23,828   $ 4,425  

         

Preferred Member Units (9,481,500 units)(24)

           9,375     (284 )

         

Member Units (45 units)

           1     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      33,204     4,141  

                               

ASC Interests, LLC

   August 1, 2013  

Recreational and Educational Shooting Facility

                        

         

12.50% Secured Debt (Maturity—July 31, 2022)

     1,650     1,602     1,602  

         

Member Units (1,500 units)

           1,500     1,050  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      3,102     2,652  

                               

Analytical Systems Keco, LLC

   August 16, 2019  

Manufacturer of Liquid and Gas Analyzers

                        

         

LIBOR Plus 10.00% (Floor 2.00%), Current Coupon 12.00%, Secured Debt (Maturity—August 16, 2024)(9)

     5,495     5,158     5,158  

         

Preferred Member Units (3,200 units)

           3,200     4,060  

         

Warrants (420 equivalent shares; Expiration—August 16, 2029; Strike price—$0.01 per share)

           316     540  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      8,674     9,758  

                               

ATS Workholding, LLC(10)

   March 10, 2014  

Manufacturer of Machine Cutting Tools and Accessories

                        

         

5% Secured Debt (Maturity—November 16, 2021)

     4,919     4,697     3,933  

         

Preferred Member Units (3,725,862 units)

           3,726     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      8,423     3,933  

                               

Bond-Coat, Inc.

   December 28, 2012  

Casing and Tubing Coating Services

                        

         

Common Stock (57,508 shares)

           6,350     7,020  

                               

Brewer Crane Holdings, LLC

   January 9, 2018  

Provider of Crane Rental and Operating Services

                        

         

LIBOR Plus 10.00% (Floor 1.00%), Current Coupon 11.58%, Secured Debt (Maturity—January 9, 2023)(9)

     8,928     8,870     8,870  

         

Preferred Member Units (2,950 units)(8)

           4,280     4,280  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      13,150     13,150  

                               

Bridge Capital Solutions Corporation

   April 18, 2012  

Financial Services and Cash Flow Solutions Provider

                        

         

13.00% Secured Debt (Maturity—December 11, 2024)

     8,813     7,938     7,938  

         

Warrants (82 equivalent shares; Expiration—July 25, 2026; Strike price—$0.01 per share)

           2,132     3,320  

         

13.00% Secured Debt (Mercury Service Group, LLC) (Maturity—December 11, 2024)

     1,000     997     997  

         

Preferred Member Units (Mercury Service Group, LLC) (17,742 units)(8)

           1,000     1,000  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      12,067     13,255  

                               

Café Brazil, LLC

   April 20, 2004  

Casual Restaurant Group

                        

         

Member Units (1,233 units)(8)

           1,742     2,180  

                               

5

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

March 31, 2020

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   

California Splendor Holdings LLC

   March 30, 2018  

Processor of Frozen Fruits

                        

         

LIBOR Plus 8.00% (Floor 1.00%), Current Coupon 10.00%, Secured Debt (Maturity—March 30, 2023)(9)

     1,429     1,314     1,416  

         

LIBOR Plus 10.00% (Floor 1.00%), Current Coupon 12.00%, Secured Debt (Maturity—March 30, 2023)(9)

     28,000     27,814     27,749  

         

Preferred Member Units (6,725 units)(8)

           7,434     7,434  

         

Preferred Member Units (6,157 units)(8)

           10,775     5,781  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      47,337     42,380  

                               

CBT Nuggets, LLC ("CBT")

   June 1, 2006  

Produces and Sells IT Training Certification Videos

                        

         

Member Units (416 units)

           1,300     47,620  

                               

Centre Technologies Holdings, LLC

   January 4, 2019  

Provider of IT Hardware Services and Software Solutions

                        

         

LIBOR Plus 10.00% (Floor 2.00%), Current Coupon 12.00%, Secured Debt (Maturity—January 4, 2024)(9)

     12,087     11,990     11,990  

         

Preferred Member Units (12,696 units)

           5,840     5,840  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      17,830     17,830  

                               

Chamberlin Holding LLC

   February 26, 2018  

Roofing and Waterproofing Specialty Contractor

                        

         

LIBOR Plus 10.00% (Floor 1.00%), Current Coupon 11.63%, Secured Debt (Maturity—February 26, 2023)(9)

     17,773     17,657     17,773  

         

Member Units (4,347 units)(8)

           11,440     24,150  

         

Member Units (Chamberlin Langfield Real Estate, LLC) (1,047,146 units)(8)

           1,047     920  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      30,144     42,843  

                               

Charps, LLC

   February 3, 2017  

Pipeline Maintenance and Construction

                        

         

15.00% Secured Debt (Maturity—June 5, 2022)

     2,000     2,000     2,000  

         

Preferred Member Units (1,600 units)(8)

           400     7,560  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      2,400     9,560  

                               

Clad-Rex Steel, LLC

   December 20, 2016  

Specialty Manufacturer of Vinyl-Clad Metal

                        

         

LIBOR Plus 9.50% (Floor 1.00%), Current Coupon 11.08%, Secured Debt (Maturity—December 20, 2021)(9)

     10,880     10,835     10,880  

         

Member Units (717 units)(8)

           7,280     8,610  

         

10.00% Secured Debt (Clad-Rex Steel RE Investor, LLC) (Maturity—December 20, 2036)

     1,131     1,120     1,131  

         

Member Units (Clad-Rex Steel RE Investor, LLC) (800 units)

           210     460  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      19,445     21,081  

                               

CMS Minerals Investments

   January 30, 2015  

Oil & Gas Exploration & Production

                        

         

Member Units (CMS Minerals II, LLC) (100 units)(8)

           2,333     1,455  

                               

6

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

March 31, 2020

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   

Cody Pools, Inc.

   March 6, 2020  

Designer of Residential and Commercial Pools

                        

         

LIBOR Plus 10.50% (Floor 1.75%), Current Coupon 12.50%, Secured Debt (Maturity—March 6, 2025)(9)

     16,000     15,842     15,842  

         

Preferred Member Units (587 units)

           8,317     8,317  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      24,159     24,159  

                               

CompareNetworks Topco, LLC

   January 29, 2019  

Internet Publishing and Web Search Portals

                        

         

LIBOR Plus 11.00% (Floor 1.00%), Current Coupon 12.63%, Secured Debt (Maturity—January 29, 2024)(9)

     8,014     7,945     7,945  

         

Preferred Member Units (1,975 units)

           1,975     3,430  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      9,920     11,375  

                               

Copper Trail Fund Investments(12)(13)

   July 17, 2017  

Investment Partnership

                        

         

LP Interests (CTMH, LP) (Fully diluted 38.8%)

           792     792  

                               

Datacom, LLC

   May 30, 2014  

Technology and Telecommunications Provider

                        

         

8.00% Secured Debt (Maturity—May 31, 2021)(14)

     1,800     1,800     1,615  

         

10.50% PIK Secured Debt (Maturity—May 31, 2021)(14)(19)

     12,507     12,475     10,142  

         

Class A Preferred Member Units

           1,294     —  

         

Class B Preferred Member Units (6,453 units)

           6,030     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      21,599     11,757  

                               

Digital Products Holdings LLC

   April 1, 2018  

Designer and Distributor of Consumer Electronics

                        

         

LIBOR Plus 10.00% (Floor 1.00%), Current Coupon 11.63%, Secured Debt (Maturity—April 1, 2023)(9)

     19,290     19,160     17,795  

         

Preferred Member Units (3,857 shares)(8)

           9,501     2,378  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      28,661     20,173  

                               

Direct Marketing Solutions, Inc.

   February 13, 2018  

Provider of Omni-Channel Direct Marketing Services

                        

         

LIBOR Plus 11.00% (Floor 1.00%), Current Coupon 12.63%, Secured Debt (Maturity—February 13, 2023)(9)

     15,482     15,371     15,482  

         

Preferred Stock (8,400 shares)

           8,400     20,060  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      23,771     35,542  

                               

Gamber-Johnson Holdings, LLC ("GJH")

   June 24, 2016  

Manufacturer of Ruggedized Computer Mounting Systems

                        

         

LIBOR Plus 6.50% (Floor 2.00%), Current Coupon 8.50%, Secured Debt (Maturity—June 24, 2021)(9)

     18,238     18,180     18,238  

         

Member Units (8,619 units)(8)

           14,844     53,240  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      33,024     71,478  

                               

7

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

March 31, 2020

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   

Garreco, LLC

   July 15, 2013  

Manufacturer and Supplier of Dental Products

                        

         

LIBOR Plus 8.00% (Floor 1.00%, Ceiling 1.50%), Current Coupon 9.50%, Secured Debt (Maturity—January 31, 2021)(9)

     4,519     4,518     4,518  

         

Member Units (1,200 units)

           1,200     2,080  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      5,718     6,598  

                               

GRT Rubber Technologies LLC ("GRT")

   December 19, 2014  

Manufacturer of Engineered Rubber Products

                        

         

LIBOR Plus 7.00%, Current Coupon 8.58%, Secured Debt (Maturity—December 31, 2023)

     16,775     16,775     16,775  

         

Member Units (5,879 units)(8)

           13,065     45,430  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      29,840     62,205  

                               

Guerdon Modular Holdings, Inc.

   August 13, 2014  

Multi-Family and Commercial Modular Construction Company

                        

         

Preferred Stock (404,998 shares)

           1,140     —  

         

Common Stock (212,033 shares)

           2,983     —  

         

Warrants (6,208,877 equivalent shares; Expiration—April 25, 2028; Strike price—$0.01 per share)

           —     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      4,123     —  

                               

Gulf Manufacturing, LLC

   August 31, 2007  

Manufacturer of Specialty Fabricated Industrial Piping Products

                        

         

Member Units (438 units)(8)

           2,980     5,250  

                               

Gulf Publishing Holdings, LLC

   April 29, 2016  

Energy Industry Focused Media and Publishing

                        

         

LIBOR Plus 9.50% (Floor 1.00%), Current Coupon 11.08%, Secured Debt (Maturity—September 30, 2020)(9)

     240     240     240  

         

12.50% Secured Debt (Maturity—April 29, 2021)

     12,535     12,500     12,361  

         

Member Units (3,681 units)

           3,681     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      16,421     12,601  

                               

Harborside Holdings, LLC

   March 20, 2017  

Real Estate Holding Company

                        

         

Member units (100 units)

           6,506     9,560  

                               

Harris Preston Fund Investments(12)(13)

   October 1, 2017  

Investment Partnership

                        

         

LP Interests (2717 MH, L.P.) (Fully diluted 49.3%)

           2,735     3,157  

                               

Harrison Hydra-Gen, Ltd.

   June 4, 2010  

Manufacturer of Hydraulic Generators

                        

         

Common Stock (107,456 shares)(8)

           718     6,360  

                               

IDX Broker, LLC

   November 15, 2013  

Provider of Marketing and CRM Tools for the Real Estate Industry

                        

         

11.00% Secured Debt (Maturity—November 15, 2020)

     12,600     12,571     12,600  

         

Preferred Member Units (5,607 units)(8)

           5,952     17,900  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      18,523     30,500  

                               

8

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

March 31, 2020

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   

Jensen Jewelers of Idaho, LLC

   November 14, 2006  

Retail Jewelry Store

                        

         

Prime Plus 6.75% (Floor 2.00%), Current Coupon 11.50%, Secured Debt (Maturity—November 14, 2023)(9)

     3,900     3,864     3,848  

         

Member Units (627 units)(8)

           811     7,800  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      4,675     11,648  

                               

J&J Services, Inc.

   October 31, 2019  

Provider of Dumpster and Portable Toilet Rental Services

                        

         

11.50% Secured Debt (Maturity—October 31, 2024)

     17,600     17,437     17,437  

         

Preferred Stock (2,814 shares)

           7,160     7,160  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      24,597     24,597  

                               

KBK Industries, LLC

   January 23, 2006  

Manufacturer of Specialty Oilfield and Industrial Products

                        

         

Member Units (325 units)(8)

           783     15,030  

                               

Kickhaefer Manufacturing Company, LLC

   October 31, 2018  

Precision Metal Parts Manufacturing

                        

         

11.50% Secured Debt (Maturity—October 31, 2023)

     25,360     25,156     25,156  

         

Member Units (581 units)

           12,240     11,450  

         

9.00% Secured Debt (Maturity—October 31, 2048)

     3,971     3,932     3,932  

         

Member Units (KMC RE Investor, LLC) (800 units)(8)

           992     1,160  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      42,320     41,698  

                               

Market Force Information, LLC

   July 28, 2017  

Provider of Customer Experience Management Services

                        

         

8.00% PIK Secured Debt (Maturity—July 28, 2022)(19)

     2,786     2,786     2,322  

         

12.00% PIK Secured Debt (Maturity—July 28, 2022)(19)

     23,292     23,165     17,519  

         

Member Units (743,921 units)

           16,642     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      42,593     19,841  

                               

MH Corbin Holding LLC

   August 31, 2015  

Manufacturer and Distributor of Traffic Safety Products

                        

         

13.00% Current Secured Debt (Maturity—March 31, 2022)

     8,810     8,743     8,742  

         

Preferred Member Units (66,000 shares)

           4,400     4,370  

         

Preferred Member Units (4,000 shares)

           6,000     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      19,143     13,112  

                               

Mid-Columbia Lumber Products, LLC

   December 18, 2006  

Manufacturer of Finger-Jointed Lumber Products

                        

         

Member Units (7,874 units)

           4,239     —  

         

9.50% Secured Debt (Mid-Columbia Real Estate, LLC) (Maturity—May 13, 2025)

     689     689     689  

         

Member Units (Mid-Columbia Real Estate, LLC) (500 units)(8)

           790     1,640  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      5,718     2,329  

                               

MSC Adviser I, LLC(16)

   November 22, 2013  

Third Party Investment Advisory Services

                        

         

Member Units (Fully diluted 100.0%)(8)

           —     61,580  

                               

9

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

March 31, 2020

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   

Mystic Logistics Holdings, LLC

   August 18, 2014  

Logistics and Distribution Services Provider for Large Volume Mailers

                        

         

12.00% Secured Debt (Maturity—January 17. 2022)(17)

     6,974     6,957     6,957  

         

Common Stock (5,873 shares)(8)

           2,720     10,190  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      9,677     17,147  

                               

NAPCO Precast, LLC

   January 31, 2008  

Precast Concrete Manufacturing

                        

         

Member Units (2,955 units)(8)

           2,975     11,910  

                               

NexRev LLC

   February 28, 2018  

Provider of Energy Efficiency Products & Services

                        

         

11.00% PIK Secured Debt (Maturity—February 28, 2023)(19)

     17,533     17,425     15,724  

         

Preferred Member Units (86,400,000 units)(8)

           6,880     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      24,305     15,724  

                               

NRI Clinical Research, LLC

   September 8, 2011  

Clinical Research Service Provider

                        

         

LIBOR Plus 6.50% (Floor 1.50%), Current Coupon 8.00%, Secured Debt (Maturity—June 8, 2022)(9)

     500     500     500  

         

9.00% Secured Debt (Maturity—June 8, 2022)

     7,000     6,912     7,000  

         

Warrants (251,723 equivalent units; Expiration—June 8, 2027; Strike price—$0.01 per unit)

           252     1,390  

         

Member Units (1,454,167 units)(8)

           765     5,321  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      8,429     14,211  

                               

NRP Jones, LLC

   December 22, 2011  

Manufacturer of Hoses, Fittings and Assemblies

                        

         

12.00% Secured Debt (Maturity—March 20, 2023)

     6,376     6,376     6,376  

         

Member Units (65,962 units)(8)

           3,717     3,490  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      10,093     9,866  

                               

NuStep, LLC

   January 31, 2017  

Designer, Manufacturer and Distributor of Fitness Equipment

                        

         

12.00% Secured Debt (Maturity—January 31, 2022)

     19,640     19,554     19,554  

         

Preferred Member Units (406 units)

           10,200     10,200  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      29,754     29,754  

                               

OMi Holdings, Inc.

   April 1, 2008  

Manufacturer of Overhead Cranes

                        

         

Common Stock (1,500 shares)(8)

           1,080     18,030  

                               

Pegasus Research Group, LLC

   January 6, 2011  

Provider of Telemarketing and Data Services

                        

         

Member Units (460 units)

           1,290     9,960  

                               

PPL RVs, Inc.

   June 10, 2010  

Recreational Vehicle Dealer

                        

         

LIBOR Plus 8.75% PIK (Floor 0.50%), Current Coupon 10.66% PIK, Secured Debt (Maturity—November 15, 2022)(9)(19)

     12,105     11,991     11,991  

         

Common Stock (1,962 shares)

           2,150     10,620  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      14,141     22,611  

                               

10

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

March 31, 2020

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   

Principle Environmental, LLC (d/b/a TruHorizon Environmental Solutions)

   February 1, 2011  

Noise Abatement Service Provider

                        

         

13.00% Secured Debt (Maturity—April 30, 2020)

     6,397     6,392     6,397  

         

Preferred Member Units (19,631 units)(8)

           4,600     13,740  

         

Warrants (1,018 equivalent units; Expiration—January 31, 2021; Strike price—$0.01 per unit)

           1,200     1,140  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      12,192     21,277  

                               

Quality Lease Service, LLC

   June 8, 2015  

Provider of Rigsite Accommodation Unit Rentals and Related Services

                        

         

Member Units (1,000 units)

           11,313     6,249  

                               

River Aggregates, LLC

   March 30, 2011  

Processor of Construction Aggregates

                        

         

Zero Coupon Secured Debt (Maturity—June 30, 2018)(17)

     750     750     722  

         

Member Units (1,150 units)(8)

           1,150     6,160  

         

Member Units (RA Properties, LLC) (1,500 units)

           369     3,249  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      2,269     10,131  

                               

Tedder Industries, LLC

   August 31, 2018  

Manufacturer of Firearm Holsters and Accessories

                        

         

12.00% Secured Debt (Maturity—August 31, 2020)

     640     640     640  

         

12.00% Secured Debt (Maturity—August 31, 2023)

     16,400     16,279     16,279  

         

Preferred Member Units (479 units)

           8,136     8,136  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      25,055     25,055  

                               

Trantech Radiator Topco, LLC

   May 31, 2019  

Transformer Cooling Products and Services

                        

         

12.00% Secured Debt (Maturity—May 31, 2024)

     8,880     8,789     8,789  

         

Common Stock (615 shares)(8)

           4,655     6,619  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      13,444     15,408  

                               

Vision Interests, Inc.

   June 5, 2007  

Manufacturer / Installer of Commercial Signage

                        

         

13.00% Secured Debt (Maturity—September 30, 2019)(17)

     2,028     2,028     2,028  

         

Series A Preferred Stock (3,000,000 shares)

           3,000     3,459  

         

Common Stock (1,126,242 shares)

           3,706     170  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      8,734     5,657  

                               

Ziegler's NYPD, LLC

   October 1, 2008  

Casual Restaurant Group

                        

         

6.50% Secured Debt (Maturity—October 1, 2020)

     1,006     1,006     904  

         

12.00% Secured Debt (Maturity—October 1, 2020)

     631     631     631  

         

14.00% Secured Debt (Maturity—October 1, 2020)

     2,783     2,783     2,504  

         

Warrants (587 equivalent units; Expiration—October 1, 2020; Strike price—$0.01 per unit)

           600     —  

         

Preferred Member Units (10,072 units)

           2,834     1,139  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      7,854     5,178  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Subtotal Control Investments (73.2% of net assets at fair value)

   $ 759,425   $ 978,368  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

11

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

March 31, 2020

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   
                                 

Affiliate Investments(6)

      

 

  

 

                    

                               

AFG Capital Group, LLC

   November 7, 2014  

Provider of Rent-to-Own Financing Solutions and Services

                        

         

10.00% Secured Debt (Maturity—May 25, 2022)

   $ 751   $ 751   $ 751  

         

Preferred Member Units (186 units)

           1,200     5,060  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      1,951     5,811  

                               

American Trailer Rental Group LLC

   June 7, 2017  

Provider of Short-term Trailer and Container Rental

                        

         

Member Units (Milton Meisler Holdings LLC) (73,493 units)

           8,596     12,950  

                               

BBB Tank Services, LLC

   April 8, 2016  

Maintenance, Repair and Construction Services to the Above-Ground Storage Tank Market

                        

         

LIBOR Plus 11.00% (Floor 1.00%), Current Coupon 12.58%, (Maturity—April 8, 2021)(9)

     4,800     4,716     4,665  

         

Preferred Stock (non-voting)(8)

           136     136  

         

Member Units (800,000 units)

           800     210  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      5,652     5,011  

                               

Boccella Precast Products LLC

   June 30, 2017  

Manufacturer of Precast Hollow Core Concrete

                        

         

LIBOR Plus 10.00% (Floor 1.00%), Current Coupon 11.91%, Secured Debt (Maturity—June 30, 2022)(9)

     12,880     12,757     12,880  

         

Member Units (2,160,000 units)(8)

           2,256     5,660  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      15,013     18,540  

                               

Buca C, LLC

   June 30, 2015  

Casual Restaurant Group

                        

         

LIBOR Plus 9.25% (Floor 1.00%), Current Coupon 10.61%, Secured Debt (Maturity—June 30, 2020)(9)

     19,004     18,992     16,984  

         

Preferred Member Units (6 units; 6% cumulative)(8)(19)

           4,770     765  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      23,762     17,749  

                               

CAI Software LLC

   October 10, 2014  

Provider of Specialized Enterprise Resource Planning Software

                        

         

11.00% Secured Debt (Maturity—December 7, 2023)

     9,144     9,065     9,144  

         

Member Units (66,968 units)(8)

           751     5,270  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      9,816     14,414  

                               

Chandler Signs Holdings, LLC(10)

   January 4, 2016  

Sign Manufacturer

                        

         

Class A Units (1,500,000 units)(8)

           1,500     2,540  

                               

Charlotte Russe, Inc(11)

   May 28, 2013  

Fast-Fashion Retailer to Young Women

                        

         

Common Stock (19,041 shares)

           3,141     —  

                               

Classic H&G Holdings, LLC

   March 12, 2020  

Provider of Engineered Packaging Solutions

                        

         

12.00% Secured Debt (Maturity—March 12, 2025)

     26,000     25,743     25,743  

         

Preferred Member Units (154 units)

           5,760     5,760  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      31,503     31,503  

                               

12

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

March 31, 2020

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   
                                 

Congruent Credit Opportunities Funds(12)(13)

   January 24, 2012  

Investment Partnership

                        

         

LP Interests (Congruent Credit Opportunities Fund II, LP) (Fully diluted 19.8%)

           5,210     855  

         

LP Interests (Congruent Credit Opportunities Fund III, LP) (Fully diluted 17.4%)(8)

           12,589     11,574  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      17,799     12,429  

                               

Copper Trail Fund Investments(12)(13)

   July 17, 2017  

Investment Partnership

                        

         

LP Interests (Copper Trail Energy Fund I, LP) (Fully diluted 12.4%)(8)

           1,997     2,362  

                               

Dos Rios Partners(12)(13)

   April 25, 2013  

Investment Partnership

                        

         

LP Interests (Dos Rios Partners, LP) (Fully diluted 20.2%)

           5,846     6,848  

         

LP Interests (Dos Rios Partners—A, LP) (Fully diluted 6.4%)

           1,856     2,174  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      7,702     9,022  

                               

East Teak Fine Hardwoods, Inc.

   April 13, 2006  

Distributor of Hardwood Products

                        

         

Common Stock (6,250 shares)

           480     300  

                               

EIG Fund Investments(12)(13)

   November 6, 2015  

Investment Partnership

                        

         

LP Interests (EIG Global Private Debt Fund—A, L.P.) (Fully diluted 11.1%)(8)

           723     562  

                               

Freeport Financial Funds(12)(13)

   June 13, 2013  

Investment Partnership

                        

         

LP Interests (Freeport Financial SBIC Fund LP) (Fully diluted 9.3%)

           5,974     5,039  

         

LP Interests (Freeport First Lien Loan Fund III LP) (Fully diluted 6.0%)(8)

           10,945     9,633  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      16,919     14,672  

                               

Fuse, LLC(11)

   June 30, 2019  

Cable Networks Operator

                        

         

12% Secured Debt (Maturity—June 28, 2024)

     1,939     1,939     1,939  

         

Common Stock (10,429 shares)

           256     256  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      2,195     2,195  

                               

Harris Preston Fund Investments(12)(13)

   August 9, 2017  

Investment Partnership

                        

         

LP Interests (HPEP 3, L.P.) (Fully diluted 8.2%)

           2,819     2,819  

                               

Hawk Ridge Systems, LLC(13)

   December 2, 2016  

Value-Added Reseller of Engineering Design and Manufacturing Solutions

                        

         

LIBOR Plus 6.00% (Floor 1.00%), Current Coupon 7.58%, Secured Debt (Maturity—December 2, 2021)(9)

     600     600     600  

         

11.00% Secured Debt (Maturity—December 2, 2021)

     13,400     13,342     13,400  

         

Preferred Member Units (226 units)(8)

           2,850     7,320  

         

Preferred Member Units (HRS Services, ULC) (226 units)

           150     390  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      16,942     21,710  

                               

13

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

March 31, 2020

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   
                                 

Houston Plating and Coatings, LLC

   January 8, 2003  

Provider of Plating and Industrial Coating Services

                        

         

8.00% Unsecured Convertible Debt (Maturity—May 1, 2022)

     3,000     3,000     3,690  

         

Member Units (322,297 units)(8)

           2,352     8,840  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      5,352     12,530  

                               

I-45 SLF LLC(12)(13)

   October 20, 2015  

Investment Partnership

                        

         

Member Units (Fully diluted 20.0%; 24.4% profits interest)(8)

           17,000     9,751  

                               

L.F. Manufacturing Holdings, LLC(10)

   December 23, 2013  

Manufacturer of Fiberglass Products

                        

         

Preferred Member Units (non-voting; 14% cumulative)(8)(19)

           84     84  

         

Member Units (2,179,001 units)

           2,019     2,050  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      2,103     2,134  

                               

OnAsset Intelligence, Inc.

   April 18, 2011  

Provider of Transportation Monitoring / Tracking Products and Services

                        

         

12.00% PIK Secured Debt (Maturity—June 30, 2021)(19)

     6,671     6,671     6,671  

         

10.00% PIK Unsecured Debt (Maturity—June 30, 2021)(19)

     60     60     60  

         

Preferred Stock (912 shares)

           1,981     —  

         

Warrants (5,333 equivalent shares; Expiration—April 18, 2021; Strike price—$0.01 per share)

           1,919     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      10,631     6,731  

                               

PCI Holding Company, Inc.

   December 18, 2012  

Manufacturer of Industrial Gas Generating Systems

                        

         

12.00% Current, Secured Debt (Maturity—March 31, 2020)(17)

     11,356     11,356     11,356  

         

Preferred Stock (1,740,000 shares) (non-voting)

           1,740     4,350  

         

Preferred Stock (1,500,000 shares)

           3,927     3,940  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      17,023     19,646  

                               

Rocaceia, LLC (Quality Lease and Rental Holdings, LLC)

   January 8, 2013  

Provider of Rigsite Accommodation Unit Rentals and Related Services

                        

         

12.00% Secured Debt (Maturity—January 8, 2018)(14)(15)

     30,369     29,865     —  

         

Preferred Member Units (250 units)

           2,500     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      32,365     —  

                               

Salado Stone Holdings, LLC(10)

   June 27, 2016  

Limestone and Sandstone Dimension Cut Stone Mining Quarries

                        

         

Class A Preferred Units (Salado Acquisition, LLC) (2,000,000 units)

           2,000     430  

                               

SI East, LLC

   August 31, 2018  

Rigid Industrial Packaging Manufacturing

                        

         

9.50% Current, Secured Debt (Maturity—August 31, 2023)

     32,963     32,705     32,963  

         

Preferred Member Units (157 units)(8)

           6,000     8,650  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      38,705     41,613  

                               

14

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

March 31, 2020

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   
                                 

Slick Innovations, LLC

   September 13, 2018  

Text Message Marketing Platform

                        

         

14.00% Current, Secured Debt (Maturity—September 13, 2023)

     6,360     6,206     6,206  

         

Common Stock (70,000 shares)(8)

           700     1,080  

         

Warrants (18,084 equivalent units; Expiration—September 13, 2028; Strike price—$0.01 per unit)

           181     290  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      7,087     7,576  

                               

UniTek Global Services, Inc.(11)

   April 15, 2011  

Provider of Outsourced Infrastructure Services

                        

         

LIBOR Plus 6.50% (Floor 1.00%), Current Coupon 8.11%, Secured Debt (Maturity—August 20, 2024)(9)

     2,970     2,949     2,687  

         

Preferred Stock (1,133,102 shares; 20% cumulative)(8)(19)

           1,242     2,833  

         

Preferred Stock (1,521,122 shares; 20% cumulative)(8)(19)

           2,082     2,282  

         

Preferred Stock (2,281,682 shares; 19% cumulative)(8)(19)

           3,667     2,417  

         

Preferred Stock (4,336,866 shares; 13.50% cumulative)(8)(19)

           7,924     4  

         

Common Stock (945,507 shares)

           —     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      17,864     10,223  

                               

Universal Wellhead Services Holdings, LLC(10)

   October 30, 2014  

Provider of Wellhead Equipment, Designs, and Personnel to the Oil & Gas Industry

                        

         

Preferred Member Units (UWS Investments, LLC) (716,949 units; 14% cumulative)(8)(19)

           1,032     540  

         

Member Units (UWS Investments, LLC) (4,000,000 units)

           4,000     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      5,032     540  

                               

Volusion, LLC

   January 26, 2015  

Provider of Online Software-as-a-Service eCommerce Solutions

                        

         

11.50% Secured Debt (Maturity—January 26, 2020)(17)

     20,234     20,234     19,243  

         

8.00% Unsecured Convertible Debt (Maturity—November 16, 2023)

     409     409     291  

         

Preferred Member Units (4,876,670 units)

           14,000     12,950  

         

Warrants (1,831,355 equivalent units; Expiration—January 26, 2025; Strike price—$0.01 per unit)

           2,576     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      37,219     32,484  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Subtotal Affiliate Investments (23.8% of net assets at fair value)

   $ 360,891   $ 318,247  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

15

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

March 31, 2020

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   
                                 

Non-Control/Non-Affiliate Investments(7)

                    

AAC Holdings, Inc.(11)

  

June 30, 2017

  

Substance Abuse Treatment Service Provider

                        

         

Prime Plus 10.00% (Floor 1.00%), Current Coupon 13.25%, Secured Debt (Maturity—April 17, 2020)(9)

     3,121     2,961     2,887  

         

LIBOR Plus 12.75% (Floor 1.00%), Current Coupon 16.50%, Secured Debt (Maturity—June 30, 2023)(9)(14)

     14,396     14,030     6,298  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      16,991     9,185  

                               

Adams Publishing Group, LLC(10)

   November 19, 2015  

Local Newspaper Operator

                        

         

Prime Plus 4.00% (Floor 1.75%), Current Coupon 7.25%, Secured Debt (Maturity—July 3, 2023)(9)

     5,000     4,935     4,501  

         

LIBOR Plus 7.50% (Floor 1.75%), Current Coupon 9.29%, Secured Debt (Maturity—July 3, 2023)(9)

     6,105     6,015     5,753  

         

LIBOR Plus 7.50% (Floor 1.75%), Current Coupon 9.25%, Secured Debt (Maturity—July 3, 2023)(9)

     196     196     196  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      11,146     10,450  

                               

ADS Tactical, Inc.(10)

   March 7, 2017  

Value-Added Logistics and Supply Chain Provider to the Defense Industry

                        

         

LIBOR Plus 6.25% (Floor 0.75%), Current Coupon 7.85%, Secured Debt (Maturity—July 26, 2023)(9)

     19,790     19,659     18,939  

                               

Aethon United BR LP(10)

   September 8, 2017  

Oil & Gas Exploration & Production

                        

         

LIBOR Plus 6.75% (Floor 1.00%), Current Coupon 7.76%, Secured Debt (Maturity—September 8, 2023)(9)

     9,750     9,637     8,701  

                               

Affordable Care Holding Corp.(10)

   May 9, 2019  

Dental Service Organization

                        

         

LIBOR Plus 4.75% (Floor 1.00%), Current Coupon 6.20%, Secured Debt (Maturity—October 22, 2022)(9)

     14,359     14,110     11,343  

                               

ALKU, LLC.(11)

   October 18, 2019  

Specialty National Staffing Operator

                        

         

LIBOR Plus 5.50%, Current Coupon 7.31%, Secured Debt (Maturity—July 29, 2026)(9)

     10,000     9,905     9,400  

                               

American Nuts, LLC(10)

   April 10, 2018  

Roaster, Mixer and Packager of Bulk Nuts and Seeds

                        

         

LIBOR Plus 9.50% (Floor 1.00%), Current Coupon 11.41%, Secured Debt (Maturity—April 10, 2023)(9)

     12,214     11,989     11,617  

                               

American Teleconferencing Services, Ltd.(11)

   May 19, 2016  

Provider of Audio Conferencing and Video Collaboration Solutions

                        

         

LIBOR Plus 6.50% (Floor 1.00%), Current Coupon 8.23%, Secured Debt (Maturity—June 8, 2023)(9)

     17,381     16,470     9,821  

                               

APTIM Corp.(11)

   August 17, 2018  

Engineering, Construction & Procurement

                        

         

7.75% Secured Debt (Maturity—June 15, 2025)

     12,452     10,891     4,234  

                               

16

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

March 31, 2020

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   
                                 

Arcus Hunting LLC(10)

   January 6, 2015  

Manufacturer of Bowhunting and Archery Products and Accessories

                        

         

LIBOR Plus 10.00% (Floor 1.00%), Current Coupon 11.91%, Secured Debt (Maturity—March 31, 2020)(9)(17)

     13,677     13,677     13,677  

                               

ASC Ortho Management Company, LLC(10)

   August 31, 2018  

Provider of Orthopedic Services

                        

         

LIBOR Plus 7.50% (Floor 1.00%), Current Coupon 9.41%, Secured Debt (Maturity—August 31, 2023)(9)

     5,264     5,191     4,767  

         

13.25% PIK Secured Debt (Maturity—December 1, 2023)(19)

     1,916     1,885     1,795  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      7,076     6,562  

                               

ATX Networks Corp.(11)(13)(21)

   June 30, 2015  

Provider of Radio Frequency Management Equipment

                        

         

LIBOR Plus 6.00% (Floor 1.00%) Current Coupon 7.45% / 1.00% PIK, Current Coupon Plus PIK 8.45% Secured Debt (Maturity—June 11, 2021)(9)(19)

     13,627     13,476     11,310  

                               

Barfly Ventures, LLC(10)

   August 31, 2015  

Casual Restaurant Group

                        

         

9.00% PIK Secured Debt (Maturity—March 23, 2021)(14)(19)

     110     110     110  

         

12.00% Secured Debt (Maturity—August 31, 2020)(14)

     10,185     10,073     1,029  

         

Options (3 equivalent units)

           607     —  

         

Warrant (2 equivalent unit; Expiration—August 31, 2025; Strike price—$1.00 per unit)

           473     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      11,263     1,139  

                               

Berry Aviation, Inc.(10)

   July 6, 2018  

Charter Airline Services

                        

         

10.50% Current / 1.5% PIK, Secured Debt (Maturity—January 6, 2024)(19)

     4,571     4,537     4,503  

         

Preferred Member Units (Berry Acquisition, LLC) (122,416 units; 16% cumulative)(8)(19)

           130     130  

         

Preferred Member Units (Berry Acquisition, LLC) (1,548,387 units; 8% cumulative)(8)(19)

           1,671     622  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      6,338     5,255  

                               

BigName Commerce, LLC(10)

   May 11, 2017  

Provider of Envelopes and Complimentary Stationery Products

                        

         

LIBOR Plus 7.25% (Floor 1.00%), Current Coupon 9.16%, Secured Debt (Maturity—May 11, 2022)(9)

     2,201     2,189     2,101  

                               

Binswanger Enterprises, LLC(10)

   March 10, 2017  

Glass Repair and Installation Service Provider

                        

         

LIBOR Plus 8.50% (Floor 1.00%), Current Coupon 9.95%, Secured Debt (Maturity—March 9, 2022)(9)

     13,635     13,377     13,200  

         

Member Units (1,050,000 units)

           1,050     730  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      14,427     13,930  

                               

17

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

March 31, 2020

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   
                                 

Bluestem Brands, Inc.(11)

   December 19, 2013  

Multi-Channel Retailer of General Merchandise

                        

         

LIBOR Plus 6.00% (Floor 1.00%), Current Coupon 7.00%, Secured Debt (Maturity—May 2, 2020)(9)

     1,644     1,619     1,619  

         

Prime Plus 6.50% (Floor 1.00%), Current Coupon 9.75%, Secured Debt (Maturity—November 6, 2020)(9)(14)

     10,622     10,571     6,320  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      12,190     7,939  

                               

Bojangles', Inc.(11)

   February 5, 2019  

Quick Service Restaurant Group

                        

         

LIBOR Plus 4.75%, Current Coupon 5.74%, Secured Debt (Maturity—January 28, 2026)

     7,762     7,627     6,811  

         

LIBOR Plus 8.50%, Current Coupon 9.49%, Secured Debt (Maturity—January 28, 2027)

     5,000     4,909     3,875  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      12,536     10,686  

                               

Brainworks Software, LLC(10)

   August 12, 2014  

Advertising Sales and Newspaper Circulation Software

                        

         

4.00% Secured Debt (Maturity—July 22, 2019)(9)(17)

     6,733     6,733     6,024  

                               

Brightwood Capital Fund Investments(12)(13)

   July 21, 2014  

Investment Partnership

                        

         

LP Interests (Brightwood Capital Fund III, LP) (Fully diluted 1.6%)(8)

           10,920     7,767  

         

LP Interests (Brightwood Capital Fund IV, LP) (Fully diluted 0.6%)(8)

           4,500     4,039  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      15,420     11,806  

                               

Cadence Aerospace LLC(10)

   November 14, 2017  

Aerostructure Manufacturing

                        

         

LIBOR Plus 6.50% (Floor 1.00%), Current Coupon 8.26%, Secured Debt (Maturity—November 14, 2023)(9)

     27,001     26,798     25,173  

                               

California Pizza Kitchen, Inc.(11)

   August 29, 2016  

Casual Restaurant Group

                        

         

LIBOR Plus 6.00% (Floor 1.00%), Current Coupon 7.62%, Secured Debt (Maturity—August 23, 2022)(9)

     14,561     14,472     7,362  

                               

Central Security Group, Inc.(11)

   December 4, 2017  

Security Alarm Monitoring Service Provider

                        

         

LIBOR Plus 5.63% (Floor 1.00%), Current Coupon 6.63%, Secured Debt (Maturity—October 6, 2021)(9)

     13,703     13,667     6,669  

                               

Cenveo Corporation(11)

   September 4, 2015  

Provider of Digital Marketing Agency Services

                        

         

Libor Plus 9.50% (Floor 1.00%), Current Coupon 10.92%, Secured Debt (Maturity—June 7, 2023)(9)

     5,674     5,509     5,532  

         

Common Stock (177,130 shares)

           5,309     2,627  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      10,818     8,159  

                               

Chisholm Energy Holdings, LLC(10)

   May 15, 2019  

Oil & Gas Exploration & Production

                        

         

LIBOR Plus 6.25% (Floor 1.50%), Current Coupon 7.94%, Secured Debt (Maturity—May 15, 2026)(9)

     3,571     3,490     3,095  

                               

18

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

March 31, 2020

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   
                                 

Clarius BIGS, LLC(10)

   September 23, 2014  

Prints & Advertising Film Financing

                        

         

15.00% PIK Secured Debt (Maturity—January 5, 2015)(14)(17)

     2,844     2,844     46  

                               

Clickbooth.com, LLC(10)

   December 5, 2017  

Provider of Digital Advertising Performance Marketing Solutions

                        

         

LIBOR Plus 8.50% (Floor 1.00%), Current Coupon 10.41%, Secured Debt (Maturity—January 31, 2025)(9)

     8,457     8,321     8,229  

                               

Construction Supply Investments, LLC(10)

   December 29, 2016  

Distribution Platform of Specialty Construction Materials to Professional Concrete and Masonry Contractors

                        

         

Member Units (50,687 units)

           5,637     6,870  

                               

Corel Corporation(11)(13)(21)

   July 24, 2019  

Publisher of Desktop and Cloud-based Software

                        

         

LIBOR Plus 5.00%, Current Coupon 6.61%, Secured Debt (Maturity—July 2, 2026)(9)

     16,906     16,119     15,004  

                               

CTVSH, PLLC(10)

   August 3, 2017  

Emergency Care and Specialty Service Animal Hospital

                        

         

LIBOR Plus 8.00% (Floor 1.00%), Current Coupon 9.58%, Secured Debt (Maturity—August 3, 2022)(9)

     9,549     9,497     9,240  

                               

Darr Equipment LP(10)

   April 15, 2014  

Heavy Equipment Dealer

                        

         

11.5% Current / 1% PIK Secured Debt (Maturity—June 22, 2023)(19)

     5,914     5,914     5,914  

         

Warrants (915,734 equivalent units; Expiration—December 23, 2023; Strike price—$1.50 per unit)

           474     110  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      6,388     6,024  

                               

Digital River, Inc.(11)

   February 24, 2015  

Provider of Outsourced e-Commerce Solutions and Services

                        

         

LIBOR Plus 7.00% (Floor 1.00%), Current Coupon 8.00%, Secured Debt (Maturity—February 12, 2023)(9)

     13,628     13,358     13,151  

                               

DTE Enterprises, LLC(10)

   April 13, 2018  

Industrial Powertrain Repair and Services

                        

         

LIBOR Plus 7.50% (Floor 1.50%), Current Coupon 9.00%, Secured Debt (Maturity—April 13, 2023)(9)

     10,992     10,838     10,680  

         

Class AA Preferred Member Units (non-voting; 10% cumulative)(8)(19)

           881     881  

         

Class A Preferred Member Units (776,316 units)

           776     1,210  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      12,495     12,771  

                               

Dynamic Communities, LLC(10)

   July 17, 2018  

Developer of Business Events and Online Community Groups

                        

         

LIBOR Plus 8.00% (Floor 1.00%), Current Coupon 9.00%, Secured Debt (Maturity—July 17, 2023)(9)

     5,425     5,346     5,075  

                               

19

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

March 31, 2020

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   
                                 

Echo US Holdings, LLC.(10)

   November 12, 2019  

Developer and Manufacturer of PVC and Polypropylene Materials

                        

         

LIBOR Plus 6.25% (Floor 1.63%), Current Coupon 7.88%, Secured Debt (Maturity—October 25, 2024)(9)

     22,963     22,847     20,938  

                               

EnCap Energy Fund Investments(12)(13)

   December 28, 2010  

Investment Partnership

                        

         

LP Interests (EnCap Energy Capital Fund VIII, L.P.) (Fully diluted 0.1%)(8)

           3,617     1,039  

         

LP Interests (EnCap Energy Capital Fund VIII Co-Investors, L.P.) (Fully diluted 0.4%)

           2,097     573  

         

LP Interests (EnCap Energy Capital Fund IX, L.P.) (Fully diluted 0.1%)(8)

           4,332     2,503  

         

LP Interests (EnCap Energy Capital Fund X, L.P.) (Fully diluted 0.1%)(8)

           8,443     8,779  

         

LP Interests (EnCap Flatrock Midstream Fund II, L.P.) (Fully diluted 0.8%)

           7,337     5,206  

         

LP Interests (EnCap Flatrock Midstream Fund III, L.P.) (Fully diluted 0.2%)(8)

           6,804     6,291  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      32,630     24,391  

                               

Encino Acquisition Partners Holdings, Inc.(11)

   November 16, 2018  

Oil & Gas Exploration & Production

                        

         

LIBOR Plus 6.75% (Floor 1.00%), Current Coupon 7.75%, Secured Debt (Maturity—October 29, 2025)(9)

     9,000     8,924     3,900  

                               

EPIC Y-Grade Services, LP(11)

   June 22, 2018  

NGL Transportation & Storage

                        

         

LIBOR Plus 6.00%, Current Coupon 7.62%, Secured Debt (Maturity—June 13, 2024)

     6,875     6,776     5,129  

                               

Evergreen Skills Lux S.á r.l. (d/b/a Skillsoft)(11)(13)

   May 5, 2014  

Technology-based Performance Support Solutions

                        

         

LIBOR Plus 8.25% (Floor 1.00%), Current Coupon 10.03%, Secured Debt (Maturity—April 28, 2022)(9)(14)

     6,999     6,935     1,265  

                               

Flavors Holdings Inc.(11)

   October 15, 2014  

Global Provider of Flavoring and Sweetening Products

                        

         

LIBOR Plus 5.75% (Floor 1.00%), Current Coupon 7.20%, Secured Debt (Maturity—June 30, 2020)(9)

     11,297     11,285     10,685  

                               

Fortna, Inc.(10)

   July 23, 2019  

Process, Physical Distribution and Logistics Consulting Services

                        

         

LIBOR Plus 5.00%, Current Coupon 5.99%, Secured Debt (Maturity—April 8, 2025)

     9,758     9,598     8,518  

                               

GeoStabilization International (GSI)(11)

   December 31, 2018  

Geohazard Engineering Services & Maintenance

                        

         

LIBOR Plus 5.25%, Current Coupon 6.24%, Secured Debt (Maturity—December 19, 2025)

     16,335     16,194     15,437  

                               

20

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

March 31, 2020

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   
                                 

GoWireless Holdings, Inc.(11)

   December 31, 2017  

Provider of Wireless Telecommunications Carrier Services

                        

         

LIBOR Plus 6.50% (Floor 1.00%), Current Coupon 7.50%, Secured Debt (Maturity—December 22, 2024)(9)

     18,120     17,971     14,707  

                               

Grupo Hima San Pablo, Inc.(11)

   March 7, 2013  

Tertiary Care Hospitals

                        

         

LIBOR Plus 7.00% (Floor 1.50%), Current Coupon 8.76%, Secured Debt (Maturity—April 30,
2019)(9)(17)

     4,504     4,504     2,936  

         

13.75% Secured Debt (Maturity—October 15, 2018)(17)

     2,055     2,040     167  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      6,544     3,103  

                               

GS HVAM Intermediate, LLC(10)

   October 18, 2019  

Specialized Food Distributor

                        

         

LIBOR Plus 5.75% (Floor 1.00%), Current Coupon 6.75%, Secured Debt (Maturity—October 2, 2024)(9)

     13,608     13,484     12,112  

                               

Gexpro Services(10)

   February 24, 2020  

Distributor of Industrial and Specialty Parts

                        

         

LIBOR Plus 6.50% (Floor 1.50%), Current Coupon 8.00%, Secured Debt (Maturity—February 24, 2025)(9)

     29,400     28,823     25,961  

                               

HDC/HW Intermediate Holdings(10)

   December 21, 2018  

Managed Services and Hosting Provider

                        

         

LIBOR Plus 7.50% (Floor 1.00%), Current Coupon 8.96%, Secured Debt (Maturity—December 21, 2023)(9)

     3,490     3,435     3,259  

                               

Hoover Group, Inc.(10)(13)

   October 21, 2016  

Provider of Storage Tanks and Related Products to the Energy and Petrochemical Markets

                        

         

LIBOR Plus 7.25% (Floor 1.00%), Current Coupon 8.78%, Secured Debt (Maturity—January 28, 2021)(9)

     20,729     20,233     19,174  

                               

Hunter Defense Technologies, Inc.(10)

   March 29, 2018  

Provider of Military and Commercial Shelters and Systems

                        

         

LIBOR Plus 7.00% (Floor 1.00%), Current Coupon 8.45%, Secured Debt (Maturity—March 29, 2023)(9)

     28,708     28,319     27,438  

                               

HW Temps LLC

   July 2, 2015  

Temporary Staffing Solutions

                        

         

12.00% Current Secured Debt (Maturity—March 29, 2023)

     10,061     9,921     8,808  

                               

Hydrofarm Holdings LLC(10)

   May 18, 2017  

Wholesaler of Horticultural Products

                        

         

LIBOR Plus 8.50%, Current Coupon 10.10% Secured Debt (Maturity—May 12, 2022)(19)

     6,907     6,816     5,601  

                               

Hyperion Materials & Technologies, Inc.(11)(13)

   September 12, 2019  

Manufacturer of Cutting and Machine Tools & Speciality Polishing Compounds

                        

         

LIBOR Plus 5.50% (Floor 1.00%), Current Coupon 6.50%, Secured Debt (Maturity—August 28, 2026)(9)

     22,500     22,079     18,675  

                               

21

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

March 31, 2020

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   
                                 

iEnergizer Limited(10)(13)(21)

   April 17, 2019  

Provider of Business Outsourcing Solutions

                        

         

LIBOR Plus 6.00% (Floor 1.00%), Current Coupon 7.00%, Secured Debt (Maturity—April 17, 2024)(9)

     12,200     12,097     11,434  

                               

Implus Footcare, LLC(10)

   June 1, 2017  

Provider of Footwear and Related Accessories

                        

         

LIBOR Plus 6.25% (Floor 1.00%), Current Coupon 7.70%, Secured Debt (Maturity—April 30, 2024)(9)

     18,577     18,197     16,359  

                               

Independent Pet Partners Intermediate Holdings, LLC(10)

   November 20, 2018  

Omnichannel Retailer of Specialty Pet Products

                        

         

LIBOR Plus 9.00% (Floor 1.00%), Current Coupon 10.90%, Secured Debt (Maturity—November 19, 2023)(9)

     19,561     19,098     18,162  

         

Member Units (1,558,333 units)

           1,558     710  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      20,656     18,872  

                               

Industrial Services Acquisition, LLC(10)

   June 17, 2016  

Industrial Cleaning Services

                        

         

6% Current / 7% PIK Unsecured Debt (Maturity—December 17, 2022)(19)

     5,334     5,271     5,334  

         

Preferred Member Units (Industrial Services Investments, LLC) (144 units; 10% cumulative)(8)(19)

           105     105  

         

Preferred Member Units (Industrial Services Investments, LLC) (80 units; 20% cumulative)(8)(19)

           63     63  

         

Member Units (Industrial Services Investments, LLC) (900 units)

           900     430  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      6,339     5,932  

                               

Inn of the Mountain Gods Resort and Casino(11)

   October 30, 2013  

Hotel & Casino Owner & Operator

                        

         

9.25% Secured Debt (Maturity—November 30, 2020)

     7,176     7,055     7,104  

                               

Interface Security Systems, L.L.C(10)

   August 7, 2019  

Commercial Security & Alarm Services

                        

         

LIBOR Plus 7.00% (Floor 1.75%), Current Coupon 8.75%, Secured Debt (Maturity—August 7, 2023)(9)

     7,500     7,371     6,777  

                               

Intermedia Holdings, Inc.(11)

   August 3, 2018  

Unified Communications as a Service

                        

         

LIBOR Plus 6.00% (Floor 1.00%), Current Coupon 6.99%, Secured Debt (Maturity—July 19, 2025)(9)

     20,130     20,037     18,419  

                               

Invincible Boat Company, LLC.(10)

   August 28, 2019  

Manufacturer of Sport Fishing Boats

                        

         

LIBOR Plus 6.50% (Floor 1.00%), Current Coupon 8.00%, Secured Debt (Maturity—August 28, 2025)(9)

     9,813     9,716     8,796  

                               

Isagenix International, LLC(11)

   June 21, 2018  

Direct Marketer of Health & Wellness Products

                        

         

LIBOR Plus 5.75% (Floor 1.00%), Current Coupon 7.02%, Secured Debt (Maturity—June 14, 2025)(9)

     5,860     5,812     2,183  

                               

22

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

March 31, 2020

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   
                                 

JAB Wireless, Inc.(10)

   May 2, 2018  

Fixed Wireless Broadband Provider

                        

         

LIBOR Plus 8.00% (Floor 1.00%), Current Coupon 9.64%, Secured Debt (Maturity—May 2, 2023)(9)

     14,738     14,638     13,834  

                               

Jackmont Hospitality, Inc.(10)

   May 26, 2015  

Franchisee of Casual Dining Restaurants

                        

         

LIBOR Plus 6.75% (Floor 1.00%), Current Coupon 8.35%, Secured Debt (Maturity—May 26, 2021)(9)

     4,059     4,055     3,273  

                               

Joerns Healthcare, LLC(11)

   April 3, 2013  

Manufacturer and Distributor of Health Care Equipment & Supplies

                        

         

LIBOR Plus 6.00% (Floor 1.00%), Current Coupon 7.12% Secured Debt (Maturity—August 21, 2024)(9)

     4,016     3,945     3,625  

         

Common Stock (472,579 shares)

           4,429     3,530  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      8,374     7,155  

                               

Kemp Technologies Inc.(10)

   June 27, 2019  

Provider of Application Delivery Controllers

                        

         

LIBOR Plus 6.25% (Floor 1.00%), Current Coupon 8.17%, Secured Debt (Maturity—March 29, 2024)(9)

     7,444     7,314     6,888  

                               

Kore Wireless Group Inc.(11)

   December 31, 2018  

Mission Critical Software Platform

                        

         

LIBOR Plus 5.50%, Current Coupon 6.57%, Secured Debt (Maturity—December 20, 2024)

     19,236     19,144     17,793  

                               

Larchmont Resources, LLC(11)

   August 13, 2013  

Oil & Gas Exploration & Production

                        

         

LIBOR Plus 7.00% (Floor 1.00%), Current Coupon 8.00%, Secured Debt (Maturity—August 7, 2020)(9)

     2,145     2,145     1,952  

         

Member Units (Larchmont Intermediate Holdco, LLC) (2,828 units)

           353     495  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      2,498     2,447  

                               

Laredo Energy VI, LP(10)

   January 15, 2019  

Oil & Gas Exploration & Production

                        

         

LIBOR Plus 9.63% (Floor 2.00%), Current Coupon 5.67% / 6.25% PIK, Current Coupon Plus PIK 11.92%, Secured Debt (Maturity—November 19, 2021)(9)(19)

     11,310     11,202     8,711  

                               

Lightbox Holdings, L.P.(11)

   May 23, 2019  

Provider of Commercial Real Estate Software

                        

         

LIBOR Plus 5.00%, Current Coupon 5.80%, Secured Debt (Maturity—May 9, 2026)

     14,925     14,719     14,701  

                               

LKCM Headwater Investments I, L.P.(12)(13)

   January 25, 2013  

Investment Partnership

                        

         

LP Interests (Fully diluted 2.3%)(8)

           1,746     3,682  

                               

LL Management, Inc.(10)

   May 2, 2019  

Medical Transportation Service Provider

                        

         

LIBOR Plus 6.50% (Floor 1.00%), Current Coupon 7.56%, Secured Debt (Maturity—September 25, 2023)(9)

     13,719     13,599     12,617  

                               

23

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

March 31, 2020

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   
                                 

Logix Acquisition Company, LLC(10)

   June 24, 2016  

Competitive Local Exchange Carrier

                        

         

LIBOR Plus 5.75% (Floor 1.00%), Current Coupon 6.74%, Secured Debt (Maturity—December 22, 2024)(9)

     18,332     18,158     15,124  

                               

Looking Glass Investments, LLC(12)(13)

   July 1, 2015  

Specialty Consumer Finance

                        

         

Member Units (2.6 units)

           125     25  

         

Member Units (LGI Predictive Analytics LLC) (190,712 units)

           41     8  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      166     33  

                               

LSF9 Atlantis Holdings, LLC(11)

   May 17, 2017  

Provider of Wireless Telecommunications Carrier Services

                        

         

LIBOR Plus 6.00% (Floor 1.00%), Current Coupon 7.00%, Secured Debt (Maturity—May 1, 2023)(9)

     9,458     9,458     7,809  

                               

Lulu's Fashion Lounge, LLC(10)

   August 31, 2017  

Fast Fashion E-Commerce Retailer

                        

         

LIBOR Plus 9.00% (Floor 1.00%), Current Coupon 10.07%, Secured Debt (Maturity—August 28, 2022)(9)

     11,335     11,095     9,692  

                               

Lynx FBO Operating LLC(10)

   September 30, 2019  

Fixed Based Operator in the General Aviation Industry

                        

         

LIBOR Plus 5.75% (Floor 1.00%), Current Coupon 7.66%, Secured Debt (Maturity—September 30, 2024)(9)

     14,681     14,396     13,020  

         

Member Units (3,704 units)

           500     445  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      14,896     13,465  

                               

Mac Lean-Fogg Company(10)

   April 22, 2019  

Manufacturer and Supplier for Auto and Power Markets

                        

         

LIBOR Plus 5.00%, Current Coupon 5.99%, Secured Debt (Maturity—December 22, 2025)

     16,648     16,532     14,646  

         

Preferred Stock (1,516 shares; 4.50% Cash / 9.25% PIK cumulative)(8)(19)

     1,792     1,792     1,729  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      18,324     16,375  

                               

MHVC Acquisition Corp. (11)

   May 8, 2017  

Provider of Differentiated Information Solutions, Systems Engineering, and Analytics

                        

         

LIBOR Plus 5.25% (Floor 1.00%), Current Coupon 6.87%, Secured Debt (Maturity—April 29, 2024)(9)

     19,950     19,860     18,654  

                               

Mills Fleet Farm Group, LLC(10)

   October 24, 2018  

Omnichannel Retailer of Work, Farm and Lifestyle Merchandise

                        

         

LIBOR Plus 6.25% (Floor 1.00%), Current Coupon 7.84% / 0.75% PIK, Current Coupon Plus PIK 9.04%, Secured Debt (Maturity—October 24, 2024)(9)(19)

     14,869     14,560     12,651  

                               

NBG Acquisition Inc(11)

   April 28, 2017  

Wholesaler of Home Décor Products

                        

         

LIBOR Plus 5.50% (Floor 1.00%), Current Coupon 6.57%, Secured Debt (Maturity—April 26, 2024)(9)

     4,153     4,109     2,359  

                               

24

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

March 31, 2020

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   
                                 

NinjaTrader, LLC(10)

   December 18, 2019  

Operator of Futures Trading Platform

                        

         

LIBOR Plus 6.00% (Floor 1.50%), Current Coupon 7.90%, Secured Debt (Maturity—December 18, 2024)(9)

     9,675     9,498     8,686  

                               

NNE Partners, LLC(10)

   March 2, 2017  

Oil & Gas Exploration & Production

                        

         

LIBOR Plus 8.00%, Current Coupon 9.58%, Secured Debt (Maturity—March 2, 2022)

     23,417     23,277     20,188  

                               

North American Lifting Holdings, Inc.(11)

   February 26, 2015  

Crane Service Provider

                        

         

LIBOR Plus 4.50% (Floor 1.00%), Current Coupon 5.95%, Secured Debt (Maturity—November 27, 2020)(9)

     7,584     7,376     5,688  

                               

Novetta Solutions, LLC(11)

   June 21, 2017  

Provider of Advanced Analytics Solutions for Defense Agencies

                        

         

LIBOR Plus 5.00% (Floor 1.00%), Current Coupon 6.00%, Secured Debt (Maturity—October 17, 2022)(9)

     21,005     20,650     18,832  

                               

NTM Acquisition Corp.(11)

   July 12, 2016  

Provider of B2B Travel Information Content

                        

         

LIBOR Plus 6.25% (Floor 1.00%), Current Coupon 7.70%, Secured Debt (Maturity—June 7, 2022)(9)

     4,864     4,864     4,840  

                               

Ospemifene Royalty Sub LLC (QuatRx)(10)

   July 8, 2013  

Estrogen-Deficiency Drug Manufacturer and Distributor

                        

         

11.50% Secured Debt (Maturity—November 15, 2026)(14)

     4,838     4,838     286  

                               

PaySimple, Inc.(10)

   September 9, 2019  

Leading Technology Services Commerce Platform

                        

         

LIBOR Plus 5.50%, Current Coupon 6.46%, Secured Debt (Maturity—August 23, 2025)(9)

     22,524     22,266     20,497  

                               

Permian Holdco 2, Inc.(11)

   February 12, 2013  

Storage Tank Manufacturer

                        

         

14.00% PIK Unsecured Debt (Maturity—October 15, 2021)(19)

     472     472     357  

         

18.00% PIK Unsecured Debt (Maturity—June 30, 2022)(19)

     333     333     333  

         

Preferred Stock (Permian Holdco 1, Inc.) (154,558 units)

           799     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      1,604     690  

                               

Point.360(10)

   July 8, 2015  

Fully Integrated Provider of Digital Media Services

                        

         

Warrants (65,463 equivalent shares; Expiration—July 7, 2020; Strike price—$0.75 per share)

           69     —  

         

Common Stock (163,658 shares)

           273     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      342     —  

                               

PricewaterhouseCoopers Public Sector LLP(11)

   May 24, 2018  

Provider of Consulting Services to Governments

                        

         

LIBOR Plus 8.00%, Current Coupon 8.99%, Secured Debt (Maturity—May 1, 2026)

     9,000     8,966     7,785  

                               

25

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

March 31, 2020

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   
                                 

PT Network, LLC(10)

   November 1, 2013  

Provider of Outpatient Physical Therapy and Sports Medicine Services

                        

         

LIBOR Plus 5.50% (Floor 1.00%), Current Coupon 7.44% / 2.00% PIK, Current Coupon Plus PIK 9.44%, Secured Debt (Maturity—November 30, 2023)(9)(19)

     8,533     8,533     7,771  

                               

Research Now Group, Inc. and Survey Sampling International, LLC(11)

   December 31, 2017  

Provider of Outsourced Online Surveying

                        

         

LIBOR Plus 5.50% (Floor 1.00%), Current Coupon 7.26%, Secured Debt (Maturity—December 20, 2024)(9)

     18,069     17,566     16,262  

                               

RM Bidder, LLC(10)

   November 12, 2015  

Scripted and Unscripted TV and Digital Programming Provider

                        

         

Warrants (327,532 equivalent units; Expiration—October 20, 2025; Strike price—$14.28 per unit)

           425     —  

         

Member Units (2,779 units)

           46     15  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      471     15  

                               

SAFETY Investment Holdings, LLC

   April 29, 2016  

Provider of Intelligent Driver Record Monitoring Software and Services

                        

         

Member Units (2,000,000 units)

           2,000     2,060  

                               

Salient Partners L.P.(11)

   June 25, 2015  

Provider of Asset Management Services

                        

         

LIBOR Plus 6.00% (Floor 1.00%), Current Coupon 7.00%, Secured Debt (Maturity—June 9, 2021)(9)

     6,450     6,435     5,704  

                               

Staples Canada ULC(10)(13)(21)

   September 14, 2017  

Office Supplies Retailer

                        

         

LIBOR Plus 7.00% (Floor 1.00%), Current Coupon 8.39%, Secured Debt (Maturity—September 12, 2024)(9)(22)

     14,183     14,000     11,067  

                               

TE Holdings, LLC(11)

   December 5, 2013  

Oil & Gas Exploration & Production

                        

         

Member Units (97,048 units)

           970     —  

                               

TEAM Public Choices, LLC(10)

   October 28, 2019  

Home-Based Care Employment Service Provider

                        

         

LIBOR Plus 6.00% (Floor 1.00%), Current Coupon 7.00%, Secured Debt (Maturity—September 20, 2024)(9)

     16,802     16,645     15,101  

                               

Tectonic Financial, Inc.

   May 15, 2017  

Financial Services Organization

                        

         

Common Stock (400,000 shares)

           2,000     2,500  

                               

TGP Holdings III LLC(11)

   September 30, 2017  

Outdoor Cooking & Accessories

                        

         

LIBOR Plus 8.50% (Floor 1.00%), Current Coupon 10.28%, Secured Debt (Maturity—September 25, 2025)(9)

     5,500     5,442     4,043  

                               

The Pasha Group(11)

   February 2, 2018  

Diversified Logistics and Transportation Provided

                        

         

LIBOR Plus 7.50% (Floor 1.00%), Current Coupon 8.94%, Secured Debt (Maturity—January 26, 2023)(9)

     12,279     11,522     10,437  

                               

26

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

March 31, 2020

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   
                                 

TOMS Shoes, LLC(11)

   November 13, 2014  

Global Designer, Distributor, and Retailer of Casual Footwear

                        

         

LIBOR Plus 5.50% (Floor 1.00%), Current Coupon 6.77%, Secured Debt (Maturity—September 30, 2025)(9)

     571     571     571  

         

LIBOR Plus 5.00% (Floor 1.00%), Current Coupon 6.27%, Secured Debt (Maturity—December 31, 2025)(9)

     1,662     1,662     1,428  

         

Member Units (16,321 units)

           245     245  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      2,478     2,244  

                               

USA DeBusk LLC(10)

   October 22, 2019  

Provider of Industrial Cleaning Services

                        

         

LIBOR Plus 5.75% (Floor 1.00%), Current Coupon 6.75%, Secured Debt (Maturity—October 22, 2024)(9)

     25,137     24,676     22,097  

                               

U.S. TelePacific Corp.(11)

   September 14, 2016  

Provider of Communications and Managed Services

                        

         

LIBOR Plus 6.00% (Floor 1.00%), Current Coupon 7.07%, Secured Debt (Maturity—May 2, 2023)(9)

     17,088     16,903     13,328  

                               

Vida Capital, Inc(11)

   October 10, 2019  

Alternative Asset Manager

                        

         

LIBOR Plus 6.00%, Current Coupon 7.78%, Secured Debt (Maturity—October 1, 2026)

     18,500     18,242     17,112  

                               

VIP Cinema Holdings, Inc.(11)

   March 9, 2017  

Supplier of Luxury Seating to the Cinema Industry

                        

         

LIBOR Plus 6.00% (Floor 1.00%), Current Coupon 7.69%, Secured Debt (Maturity—May 18, 2020)(9)

     1,655     1,546     1,546  

         

Prime Plus 7.00% (Floor 1.00%), Current Coupon 10.25%, Secured Debt (Maturity—March 1, 2023)(9)(14)

     10,063     10,030     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      11,576     1,546  

                               

Vistar Media, Inc.(10)

   February 17, 2017  

Operator of Digital Out-of-Home Advertising Platform

                        

         

LIBOR Plus 7.50% (Floor 1.00%), Current Coupon 9.50%, Secured Debt (Maturity—April 3, 2023)(9)

     4,670     4,515     4,522  

         

Preferred Stock (70,207 shares)

           767     1,830  

         

Warrants (69,675 equivalent shares; Expiration—April 3, 2029; Strike price—$10.92 per share)

           —     1,850  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      5,282     8,202  

                               

Wireless Vision Holdings, LLC(10)

   September 29, 2017  

Provider of Wireless Telecommunications Carrier Services

                        

         

LIBOR Plus 8.94% (Floor 1.00%), Current Coupon 10.42% / 1.00% PIK, Current Coupon Plus PIK 11.42%, Secured Debt (Maturity—September 29, 2022)(9)(19)(23)

     7,140     7,036     6,102  

         

LIBOR Plus 8.91% (Floor 1.00%), Current Coupon 10.52% / 1.00% PIK, Current Coupon Plus PIK 11.52%, Secured Debt (Maturity—September 29, 2022)(9)(19)(23)

     6,204     6,142     5,306  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      13,178     11,408  

                               

27

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

March 31, 2020

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   
                                 

YS Garments, LLC(11)

   August 22, 2018  

Designer and Provider of Branded Activewear

                        

         

LIBOR Plus 6.00% (Floor 1.00%), Current Coupon 7.00% Secured Debt (Maturity—August 9, 2024)(9)

     14,438     14,324     13,065  

                               

Zilliant Incorporated

   June 15, 2012  

Price Optimization and Margin Management Solutions

                        

         

Preferred Stock (186,777 shares)

           154     260  

         

Warrants (952,500 equivalent shares; Expiration—June 15, 2022; Strike price—$0.001 per share)

           1,071     1,190  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      1,225     1,450  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Subtotal Non-Control/Non-Affiliate Investments (80.5% of net assets at fair value)

   $ 1,270,531   $ 1,076,131  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Total Portfolio Investments, March 31, 2020

   $ 2,390,847   $ 2,372,746  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
(1)
All investments are Lower Middle Market portfolio investments, unless otherwise noted. See Note B for a description of Lower Middle Market portfolio investments. All of the Company's investments, unless otherwise noted, are encumbered either as security for the Company's Credit Facility or in support of the SBA-guaranteed debentures issued by the Funds.

(2)
Debt investments are income producing, unless otherwise noted. Equity and warrants are non-income producing, unless otherwise noted.

(3)
See Note C and Schedule 12-14 for a summary of geographic location of portfolio companies.

(4)
Principal is net of repayments. Cost is net of repayments and accumulated unearned income.

(5)
Control investments are defined by the Investment Company Act of 1940, as amended ("1940 Act"), as investments in which more than 25% of the voting securities are owned or where the ability to nominate greater than 50% of the board representation is maintained.
(6)
Affiliate investments are defined by the 1940 Act as investments in which between 5% and 25% (inclusive) of the voting securities are owned and the investments are not classified as Control investments.

(7)
Non-Control/Non-Affiliate investments are defined by the 1940 Act as investments that are neither Control investments nor Affiliate investments.

(8)
Income producing through dividends or distributions.

(9)
Index based floating interest rate is subject to contractual minimum interest rate. A majority of the variable rate loans in the Company's investment portfolio bear interest at a rate that may be determined by reference to either LIBOR or an alternate Base Rate (commonly based on the Federal Funds Rate or the Prime Rate), which typically resets semi-annually, quarterly, or monthly at the borrower's option. The borrower may also elect to have multiple interest reset periods for each loan. For each such loan, the Company has provided the weighted average annual stated interest rate in effect at March 31, 2020. As noted in this schedule, 62% of the loans (based on the par amount) contain LIBOR floors which range between 0.50% and 2.00%, with a weighted-average LIBOR floor of approximately 1.09%.

(10)
Private Loan portfolio investment. See Note B for a description of Private Loan portfolio investments.

(11)
Middle Market portfolio investment. See Note B for a description of Middle Market portfolio investments.

(12)
Other Portfolio investment. See Note B for a description of Other Portfolio investments.

(13)
Investment is not a qualifying asset as defined under Section 55(a) of the 1940 Act. Qualifying assets must represent at least 70% of total assets at the time of acquisition of any additional non-qualifying assets.

(14)
Non-accrual and non-income producing investment.

(15)
Portfolio company is in a bankruptcy process and, as such, the maturity date of our debt investment in this portfolio company will not be finally determined until such process is complete. As noted in footnote (14), our debt investment in this portfolio company is on non-accrual status.

(16)
External Investment Manager. Investment is not encumbered as security for the Company's Credit Facility or in support of the SBA-guaranteed debentures issued by the Funds.

(17)
Maturity date is under on-going negotiations with the portfolio company and other lenders, if applicable.

(18)
Investment fair value was determined using significant unobservable inputs, unless otherwise noted. See Note C for further discussion.

(19)
PIK interest income and cumulative dividend income represent income not paid currently in cash.

(20)
All portfolio company headquarters are based in the United States, unless otherwise noted.

(21)
Portfolio company headquarters are located outside of the United States.

(22)
In connection with the Company's debt investment in Staples Canada ULC and in an attempt to mitigate any potential adverse change in foreign exchange rates during the term of the Company's investment, the Company maintains a forward foreign currency contract with Cadence Bank to lend $17.2 million Canadian Dollars and receive $13.1 million U.S. Dollars with a settlement date of September 14, 2020. The unrealized appreciation on the forward foreign currency contract is $0.8 million as of March 31, 2020.

(23)
The Company has entered into an intercreditor agreement that entitles the Company to the "last out" tranche of the first lien secured loans, whereby the "first out" tranche will receive priority as to the "last out" tranche with respect to payments of principal, interest, and any other amounts due thereunder. Therefore, the

28

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MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

March 31, 2020

(dollars in thousands)

    Company receives a higher interest rate than the contractual stated interest rate of LIBOR plus 8.50% (Floor 1.00%) per the credit agreement and the Consolidated Schedule of Investments above reflects such higher rate.

(24)
Investment has an unfunded commitment as of March 31, 2020 (see Note K). The fair value of the investment includes the impact of the fair value of any unfunded commitments.

(25)
All of the Company's portfolio investments are generally subject to restrictions on resale as "restricted securities."

(26)
Investment date represents the date of initial investment in the portfolio company.

29

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments

December 31, 2019

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   

Control Investments(5)

      

 

  

 

                    

                               

Access Media Holdings, LLC(10)

   July 22, 2015  

Private Cable Operator

                        

         

10% PIK Secured Debt (Maturity—July 22, 2020)(14)(19)

   $ 23,828   $ 23,828   $ 6,387  

         

Preferred Member Units (9,481,500 units)(27)

           9,375     (284 )

         

Member Units (45 units)

           1     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      33,204     6,103  

                               

ASC Interests, LLC

   August 1, 2013  

Recreational and Educational Shooting Facility

                        

         

11.00% Secured Debt (Maturity—July 31, 2020)

     1,650     1,639     1,639  

         

Member Units (1,500 units)

           1,500     1,290  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      3,139     2,929  

                               

Analytical Systems Keco, LLC

   August 16, 2019  

Manufacturer of Liquid and Gas Analyzers

                        

         

LIBOR Plus 10.00% (Floor 2.00%), Current Coupon 12.13%, Secured Debt (Maturity—August 16, 2024)(9)

     5,565     5,210     5,210  

         

Preferred Member Units (3,200 units)

           3,200     3,200  

         

Warrants (420 equivalent shares; Expiration—August 16, 2029; Strike price—$0.01 per share)

           316     316  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      8,726     8,726  

                               

ATS Workholding, LLC(10)

   March 10, 2014  

Manufacturer of Machine Cutting Tools and Accessories

                        

         

5% Secured Debt (Maturity—November 16, 2021)

     4,919     4,666     4,521  

         

Preferred Member Units (3,725,862 units)

           3,726     939  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      8,392     5,460  

                               

Bond-Coat, Inc.

   December 28, 2012  

Casing and Tubing Coating Services

                        

         

15.00% Secured Debt (Maturity—December 28, 2020)

     11,596     11,473     11,473  

         

Common Stock (57,508 shares)

           6,350     8,300  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      17,823     19,773  

                               

Brewer Crane Holdings, LLC

   January 9, 2018  

Provider of Crane Rental and Operating Services

                        

         

LIBOR Plus 10.00% (Floor 1.00%), Current Coupon 11.71%, Secured Debt (Maturity—January 9, 2023)(9)

     9,052     8,989     8,989  

         

Preferred Member Units (2,950 units)(8)

           4,280     4,280  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      13,269     13,269  

                               

Bridge Capital Solutions Corporation

   April 18, 2012  

Financial Services and Cash Flow Solutions Provider

                        

         

13.00% Secured Debt (Maturity—December 11, 2024)

     8,813     7,797     7,797  

         

Warrants (82 equivalent shares; Expiration—July 25, 2026; Strike price—$0.01 per share)

           2,132     3,500  

         

13.00% Secured Debt (Mercury Service Group, LLC) (Maturity—December 11, 2024)

     1,000     996     996  

         

Preferred Member Units (Mercury Service Group, LLC) (17,742 units)(8)

           1,000     1,000  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      11,925     13,293  

                               

30

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2019

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   

Café Brazil, LLC

   April 20, 2004  

Casual Restaurant Group

                        

         

Member Units (1,233 units)(8)

           1,742     2,440  

                               

California Splendor Holdings LLC

   March 30, 2018  

Processor of Frozen Fruits

                        

         

LIBOR Plus 8.00% (Floor 1.00%), Current Coupon 10.13%, Secured Debt (Maturity—March 30, 2023)(9)

     7,229     7,104     7,104  

         

LIBOR Plus 10.00% (Floor 1.00%), Current Coupon 12.13%, Secured Debt (Maturity—March 30, 2023)(9)

     28,000     27,801     27,801  

         

Preferred Member Units (6,725 units)(8)

           7,163     7,163  

         

Preferred Member Units (6,157 units)(8)

           10,775     7,382  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      52,843     49,450  

                               

CBT Nuggets, LLC ("CBT")

   June 1, 2006  

Produces and Sells IT Training Certification Videos

                        

         

Member Units (416 units)(8)

           1,300     50,850  

                               

Centre Technologies Holdings, LLC

   January 4, 2019  

Provider of IT Hardware Services and Software Solutions

                        

         

LIBOR Plus 9.00% (Floor 2.00%), Current Coupon 10.75%, Secured Debt (Maturity—January 4, 2024)(9)

     12,240     12,136     12,136  

         

Preferred Member Units (12,696 units)

           5,840     5,840  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      17,976     17,976  

                               

Chamberlin Holding LLC

   February 26, 2018  

Roofing and Waterproofing Specialty Contractor

                        

         

LIBOR Plus 10.00% (Floor 1.00%), Current Coupon 12.00%, Secured Debt (Maturity—February 26, 2023)(9)

     17,773     17,649     17,773  

         

Member Units (4,347 units)(8)

           11,440     24,040  

         

Member Units (Chamberlin Langfield Real Estate, LLC) (1,047,146 units)(8)

           1,047     1,450  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      30,136     43,263  

                               

Charps, LLC

   February 3, 2017  

Pipeline Maintenance and Construction

                        

         

15.00% Secured Debt (Maturity—June 5, 2022)

     2,000     2,000     2,000  

         

Preferred Member Units (1,600 units)(8)

           400     6,920  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      2,400     8,920  

                               

Clad-Rex Steel, LLC

   December 20, 2016  

Specialty Manufacturer of Vinyl-Clad Metal

                        

         

LIBOR Plus 9.00% (Floor 1.00%), Current Coupon 10.71%, Secured Debt (Maturity—December 20, 2021)(9)

     10,880     10,830     10,781  

         

Member Units (717 units)(8)

           7,280     9,630  

         

10.00% Secured Debt (Clad-Rex Steel RE Investor, LLC) (Maturity—December 20, 2036)

     1,137     1,126     1,137  

         

Member Units (Clad-Rex Steel RE Investor, LLC) (800 units)

           210     460  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      19,446     22,008  
                                 

CMS Minerals Investments

   January 30, 2015  

Oil & Gas Exploration & Production

                        

         

Member Units (CMS Minerals II, LLC) (100 units)(8)

           2,386     1,900  

                               

31

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MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2019

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   

CompareNetworks Topco, LLC

   January 29, 2019  

Internet Publishing and Web Search Portals

                        

         

LIBOR Plus 11.00% (Floor 1.00%), Current Coupon 12.75%, Secured Debt (Maturity—January 29, 2024)(9)

     8,364     8,288     8,288  

         

Preferred Member Units (1,975 units)

           1,975     3,010  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      10,263     11,298  

                               

Copper Trail Fund Investments(12)(13)

   July 17, 2017  

Investment Partnership

                        

         

LP Interests (CTMH, LP) (Fully diluted 38.8%)

           872     872  

                               

Datacom, LLC

   May 30, 2014  

Technology and Telecommunications Provider

                        

         

8.00% Secured Debt (Maturity—May 31, 2021)(14)

     1,800     1,800     1,615  

         

10.50% PIK Secured Debt (Maturity—May 31, 2021)(14)(19)

     12,507     12,475     10,142  

         

Class A Preferred Member Units

           1,294     —  

         

Class B Preferred Member Units (6,453 units)

           6,030     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      21,599     11,757  

                               

Digital Products Holdings LLC

   April 1, 2018  

Designer and Distributor of Consumer Electronics

                        

         

LIBOR Plus 10.00% (Floor 1.00%), Current Coupon 11.75%, Secured Debt (Maturity—April 1, 2023)(9)

     19,620     19,478     18,452  

         

Preferred Member Units (3,857 shares)(8)

           9,501     5,174  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      28,979     23,626  

                               

Direct Marketing Solutions, Inc.

   February 13, 2018  

Provider of Omni-Channel Direct Marketing Services

                        

         

LIBOR Plus 11.00% (Floor 1.00%), Current Coupon 12.75%, Secured Debt (Maturity—February 13, 2023)(9)

     15,717     15,597     15,707  

         

Preferred Stock (8,400 shares)

           8,400     20,200  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      23,997     35,907  

                               

Gamber-Johnson Holdings, LLC ("GJH")

   June 24, 2016  

Manufacturer of Ruggedized Computer Mounting Systems

                        

         

LIBOR Plus 6.50% (Floor 2.00%), Current Coupon 8.50%, Secured Debt (Maturity—June 24, 2021)(9)

     19,022     18,949     19,022  

         

Member Units (8,619 units)(8)

           14,844     53,410  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      33,793     72,432  

                               

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MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2019

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   

Garreco, LLC

   July 15, 2013  

Manufacturer and Supplier of Dental Products

                        

         

LIBOR Plus 8.00% (Floor 1.00%, Ceiling 1.50%), Current Coupon 9.50%, Secured Debt (Maturity—March 31, 2020)(9)

     4,519     4,515     4,515  

         

Member Units (1,200 units)

           1,200     2,560  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      5,715     7,075  

                               

GRT Rubber Technologies LLC ("GRT")

   December 19, 2014  

Manufacturer of Engineered Rubber Products

                        

         

LIBOR Plus 7.00%, Current Coupon 8.71%, Secured Debt (Maturity—December 31, 2023)

     15,016     15,016     15,016  

         

Member Units (5,879 units)

           13,065     47,450  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      28,081     62,466  

                               

Guerdon Modular Holdings, Inc.

   August 13, 2014  

Multi-Family and Commercial Modular Construction Company

                        

         

LIBOR Plus 8.50% (Floor 1.00%), Current Coupon 10.60%, Secured Debt (Maturity—October 1, 2019)(9)(14)(17)

     1,010     1,010     —  

         

16.00% Secured Debt (Maturity—October 1, 2019)(14)(17)

     12,588     12,588     —  

         

Preferred Stock (404,998 shares)

           1,140     —  

         

Common Stock (212,033 shares)

           2,983     —  

         

Warrants (6,208,877 equivalent shares; Expiration— April 25, 2028; Strike price—$0.01 per share)

           —     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      17,721     —  

                               

Gulf Manufacturing, LLC

   August 31, 2007  

Manufacturer of Specialty Fabricated Industrial Piping Products

                        

         

Member Units (438 units)(8)

           2,980     7,430  

                               

Gulf Publishing Holdings, LLC

   April 29, 2016  

Energy Industry Focused Media and Publishing

                        

         

LIBOR Plus 9.50% (Floor 1.00%), Current Coupon 11.21%, Secured Debt (Maturity—September 30, 2020)(9)

     280     280     280  

         

12.50% Secured Debt (Maturity—April 29, 2021)

     12,535     12,493     12,493  

         

Member Units (3,681 units)

           3,681     2,420  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      16,454     15,193  

                               

Harborside Holdings, LLC

   March 20, 2017  

Real Estate Holding Company

                        

         

Member units (100 units)

           6,506     9,560  

                               

Harris Preston Fund Investments(12)(13)

   October 1, 2017  

Investment Partnership

                        

         

LP Interests (2717 MH, L.P.) (Fully diluted 49.3%)

           2,735     3,157  

                               

Harrison Hydra-Gen, Ltd.

   June 4, 2010  

Manufacturer of Hydraulic Generators

                        

         

Common Stock (107,456 shares)(8)

           718     7,970  

                               

IDX Broker, LLC

   November 15, 2013  

Provider of Marketing and CRM Tools for the Real Estate Industry

                        

         

11.50% Secured Debt (Maturity—November 15, 2020)

     13,400     13,358     13,400  

         

Preferred Member Units (5,607 units)(8)

           5,952     15,040  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      19,310     28,440  

                               

33

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2019

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   

Jensen Jewelers of Idaho, LLC

   November 14, 2006  

Retail Jewelry Store

                        

         

Prime Plus 6.75% (Floor 2.00%), Current Coupon 11.50%, Secured Debt (Maturity—November 14, 2023)(9)

     4,000     3,960     4,000  

         

Member Units (627 units)(8)

           811     8,270  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      4,771     12,270  

                               

J&J Services, Inc.

   October 31, 2019  

Provider of Dumpster and Portable Toilet Rental Services

                        

         

11.50% Secured Debt (Maturity—October 31, 2024)

     17,600     17,430     17,430  

         

Preferred Stock (2,814 shares)

           7,160     7,160  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      24,590     24,590  

                               

KBK Industries, LLC

   January 23, 2006  

Manufacturer of Specialty Oilfield and Industrial Products

                        

         

Member Units (325 units)(8)

           783     15,470  

                               

Kickhaefer Manufacturing Company, LLC

   October 31, 2018  

Precision Metal Parts Manufacturing

                        

         

11.50% Secured Debt (Maturity—October 31, 2023)

     25,200     24,982     24,982  

         

Member Units (581 units)

           12,240     12,240  

         

9.00% Secured Debt (Maturity—October 31, 2048)

     3,978     3,939     3,939  

         

Member Units (KMC RE Investor, LLC) (800 units)(8)

           992     1,160  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      42,153     42,321  

                               

Market Force Information, LLC

   July 28, 2017  

Provider of Customer Experience Management Services

                        

         

8.00% Secured Debt (Maturity—July 28, 2022)

     2,786     2,786     2,695  

         

6.00% Current / 6.00% PIK Secured Debt (Maturity—July 28, 2022)(19)

     23,292     23,157     22,621  

         

Member Units (743,921 units)

           16,642     5,280  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      42,585     30,596  

                               

MH Corbin Holding LLC

   August 31, 2015  

Manufacturer and Distributor of Traffic Safety Products

                        

         

5.00% Current / 5.00% PIK Secured Debt (Maturity—March 31, 2022)(19)

     8,890     8,815     8,890  

         

Preferred Member Units (66,000 shares)

           4,400     4,770  

         

Preferred Member Units (4,000 shares)

           6,000     20  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      19,215     13,680  

                               

Mid-Columbia Lumber Products, LLC

   December 18, 2006  

Manufacturer of Finger-Jointed Lumber Products

                        

         

10.00% Secured Debt (Maturity—January 15, 2020)

     1,750     1,750     1,602  

         

12.00% Secured Debt (Maturity—January 15, 2020)

     3,900     3,898     3,644  

         

Member Units (7,874 units)

           3,239     —  

         

9.50% Secured Debt (Mid-Columbia Real Estate, LLC) (Maturity—May 13, 2025)

     701     701     701  

         

Member Units (Mid-Columbia Real Estate, LLC) (500 units)(8)

           790     1,640  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      10,378     7,587  

                               

34

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2019

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   

MSC Adviser I, LLC(16)

   November 22, 2013  

Third Party Investment Advisory Services

                        

         

Member Units (Fully diluted 100.0%)(8)

           —     74,520  

                               

Mystic Logistics Holdings, LLC

   August 18, 2014  

Logistics and Distribution Services Provider for Large Volume Mailers

                        

         

12.00% Secured Debt (Maturity—August 15. 2019)(17)

     6,253     6,253     6,253  

         

Common Stock (5,873 shares)(8)

           2,720     8,410  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      8,973     14,663  

                               

NAPCO Precast, LLC

   January 31, 2008  

Precast Concrete Manufacturing

                        

         

Member Units (2,955 units)(8)

           2,975     14,760  

                               

NexRev LLC

   February 28, 2018  

Provider of Energy Efficiency Products & Services

                        

         

11.00% Secured Debt (Maturity—February 28, 2023)

     17,586     17,469     17,469  

         

Preferred Member Units (86,400,000 units)(8)

           6,880     6,310  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      24,349     23,779  

                               

NRI Clinical Research, LLC

   September 8, 2011  

Clinical Research Service Provider

                        

         

14.00% Secured Debt (Maturity—June 8, 2022)

     5,981     5,885     5,981  

         

Warrants (251,723 equivalent units; Expiration—June 8, 2027; Strike price—$0.01 per unit)

           252     1,230  

         

Member Units (1,454,167 units)(8)

           765     4,988  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      6,902     12,199  

                               

NRP Jones, LLC

   December 22, 2011  

Manufacturer of Hoses, Fittings and Assemblies

                        

         

12.00% Secured Debt (Maturity—March 20, 2023)

     6,376     6,376     6,376  

         

Member Units (65,962 units)(8)

           3,717     4,710  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      10,093     11,086  

                               

NuStep, LLC

   January 31, 2017  

Designer, Manufacturer and Distributor of Fitness Equipment

                        

         

12.00% Secured Debt (Maturity—January 31, 2022)

     19,800     19,703     19,703  

         

Preferred Member Units (406 units)

           10,200     10,200  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      29,903     29,903  

                               

OMi Holdings, Inc.

   April 1, 2008  

Manufacturer of Overhead Cranes

                        

         

Common Stock (1,500 shares)(8)

           1,080     16,950  

                               

Pegasus Research Group, LLC

   January 6, 2011  

Provider of Telemarketing and Data Services

                        

         

Member Units (460 units)

           1,290     8,170  

                               

PPL RVs, Inc.

   June 10, 2010  

Recreational Vehicle Dealer

                        

         

LIBOR Plus 8.75% (Floor 0.50%), Current Coupon 10.85%, Secured Debt (Maturity—November 15, 2022)(9)

     12,245     12,118     12,118  

         

Common Stock (1,962 shares)

           2,150     9,930  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      14,268     22,048  

                               

35

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2019

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   

Principle Environmental, LLC (d/b/a TruHorizon Environmental Solutions)

   February 1, 2011  

Noise Abatement Service Provider

                        

         

13.00% Secured Debt (Maturity—April 30, 2020)

     6,397     6,379     6,397  

         

Preferred Member Units (19,631 units)(8)

           4,600     13,390  

         

Warrants (1,018 equivalent units; Expiration—January 31, 2021; Strike price—$0.01 per unit)

           1,200     1,090  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      12,179     20,877  

                               

Quality Lease Service, LLC

   June 8, 2015  

Provider of Rigsite Accommodation Unit Rentals and Related Services

                        

         

Member Units (1,000 units)

           11,013     9,289  

                               

River Aggregates, LLC

   March 30, 2011  

Processor of Construction Aggregates

                        

         

Zero Coupon Secured Debt (Maturity—June 30, 2018)(17)

     750     750     722  

         

Member Units (1,150 units)

           1,150     4,990  

         

Member Units (RA Properties, LLC) (1,500 units)

           369     3,169  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      2,269     8,881  

                               

Tedder Industries, LLC

   August 31, 2018  

Manufacturer of Firearm Holsters and Accessories

                        

         

12.00% Secured Debt (Maturity—August 31, 2020)

     640     640     640  

         

12.00% Secured Debt (Maturity—August 31, 2023)

     16,400     16,272     16,272  

         

Preferred Member Units (479 units)

           8,136     8,136  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      25,048     25,048  

                               

The MPI Group, LLC

   October 2, 2007  

Manufacturer of Custom Hollow Metal Doors, Frames and Accessories

                        

         

9.00% Secured Debt (Maturity—December 31, 2019)(17)

     2,924     2,924     2,924  

         

Series A Preferred Units (2,500 units)

           2,500     —  

         

Warrants (1,424 equivalent units; Expiration—July 1, 2024; Strike price—$0.01 per unit)

           1,096     —  

         

Member Units (MPI Real Estate Holdings, LLC) (100 units)(8)

           2,300     1,640  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      8,820     4,564  

                               

Trantech Radiator Topco, LLC

   May 31, 2019  

Transformer Cooling Products and Services

                        

         

12.00% Secured Debt (Maturity—May 31, 2024)

     9,200     9,102     9,102  

         

Common Stock (615 shares)(8)

           4,655     4,655  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      13,757     13,757  

                               

Vision Interests, Inc.

   June 5, 2007  

Manufacturer / Installer of Commercial Signage

                        

         

13.00% Secured Debt (Maturity—September 30, 2019)(17)

     2,028     2,028     2,028  

         

Series A Preferred Stock (3,000,000 shares)

           3,000     4,089  

         

Common Stock (1,126,242 shares)

           3,706     409  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      8,734     6,526  

                               

36

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2019

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   

Ziegler's NYPD, LLC

   October 1, 2008  

Casual Restaurant Group

                        

         

6.50% Secured Debt (Maturity—October 1, 2020)

     1,000     1,000     1,000  

         

12.00% Secured Debt (Maturity—October 1, 2020)

     625     625     625  

         

14.00% Secured Debt (Maturity—October 1, 2020)

     2,750     2,750     2,750  

         

Warrants (587 equivalent units; Expiration—October 1, 2020; Strike price—$0.01 per unit)

           600     —  

         

Preferred Member Units (10,072 units)

           2,834     1,269  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      7,809     5,644  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Subtotal Control Investments (67.2% of net assets at fair value)

   $ 778,367   $ 1,032,721  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

37

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2019

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   

Affiliate Investments(6)

  

 

                    

                               

AFG Capital Group, LLC

   November 7, 2014  

Provider of Rent-to-Own Financing Solutions and Services

                        

         

10.00% Secured Debt (Maturity—May 25, 2022)

   $ 838   $ 838   $ 838  

         

Preferred Member Units (186 units)

           1,200     5,180  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      2,038     6,018  

                               

American Trailer Rental Group LLC

   June 7, 2017  

Provider of Short-term Trailer and Container Rental

                        

         

LIBOR Plus 7.25% (Floor 1.00%), Current Coupon 9.34%, Secured Debt (Maturity—June 7, 2022)(9)

     27,087     26,905     27,087  

         

Member Units (Milton Meisler Holdings LLC) (48,555 units)

           4,855     8,540  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      31,760     35,627  

                               

BBB Tank Services, LLC

   April 8, 2016  

Maintenance, Repair and Construction Services to the Above-Ground Storage Tank Market

                        

         

LIBOR Plus 11.00% (Floor 1.00%), Current Coupon 12.71%, (Maturity—April 8, 2021)(9)

     4,800     4,698     4,698  

         

Preferred Stock (non-voting)(8)

           131     131  

         

Member Units (800,000 units)

           800     290  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      5,629     5,119  

                               

Boccella Precast Products LLC

   June 30, 2017  

Manufacturer of Precast Hollow Core Concrete

                        

         

LIBOR Plus 12.00% (Floor 1.00%), Current Coupon 14.10%, Secured Debt (Maturity—June 30, 2022)(9)

     13,244     13,106     13,244  

         

Member Units (2,160,000 units)(8)

           2,256     6,270  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      15,362     19,514  

                               

Buca C, LLC

   June 30, 2015  

Casual Restaurant Group

                        

         

LIBOR Plus 9.25% (Floor 1.00%), Current Coupon 10.94%, Secured Debt (Maturity—June 30, 2020)(9)

     19,004     18,981     18,794  

         

Preferred Member Units (6 units; 6% cumulative)(8)(19)

           4,701     4,701  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      23,682     23,495  

                               

CAI Software LLC

   October 10, 2014  

Provider of Specialized Enterprise Resource Planning Software

                        

         

11.00% Secured Debt (Maturity—December 7, 2023)

     9,160     9,077     9,160  

         

Member Units (66,968 units)(8)

           751     5,210  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      9,828     14,370  

                               

Chandler Signs Holdings, LLC(10)

   January 4, 2016  

Sign Manufacturer

                        

         

Class A Units (1,500,000 units)(8)

           1,500     2,740  

                               

Charlotte Russe, Inc(11)

   May 28, 2013  

Fast-Fashion Retailer to Young Women

                        

         

Common Stock (19,041 shares)

           3,141     —  

                               

Congruent Credit Opportunities Funds(12)(13)

   January 24, 2012  

Investment Partnership

                        

         

LP Interests (Congruent Credit Opportunities Fund II, LP) (Fully diluted 19.8%)

           5,210     855  

         

LP Interests (Congruent Credit Opportunities Fund III, LP) (Fully diluted 17.4%)(8)

           13,601     13,915  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      18,811     14,770  

                               

38

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2019

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   

Copper Trail Fund Investments(12)(13)

   July 17, 2017  

Investment Partnership

                        

         

LP Interests (Copper Trail Energy Fund I, LP) (Fully diluted 12.4%)(8)

           1,997     2,362  

                               

Dos Rios Partners(12)(13)

   April 25, 2013  

Investment Partnership

                        

         

LP Interests (Dos Rios Partners, LP) (Fully diluted 20.2%)

           5,846     7,033  

         

LP Interests (Dos Rios Partners—A, LP) (Fully diluted 6.4%)

           1,856     2,233  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      7,702     9,266  

                               

East Teak Fine Hardwoods, Inc.

   April 13, 2006  

Distributor of Hardwood Products

                        

         

Common Stock (6,250 shares)(8)

           480     400  

                               

EIG Fund Investments(12)(13)

   November 6, 2015  

Investment Partnership

                        

         

LP Interests (EIG Global Private Debt Fund-A, L.P.) (Fully diluted 11.1%)(8)

           768     720  

                               

Freeport Financial Funds(12)(13)

   June 13, 2013  

Investment Partnership

                        

         

LP Interests (Freeport Financial SBIC Fund LP) (Fully diluted 9.3%)

           5,974     5,778  

         

LP Interests (Freeport First Lien Loan Fund III LP) (Fully diluted 6.0%)(8)

           9,956     9,696  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      15,930     15,474  

                               

Fuse, LLC(11)

   June 30, 2019  

Cable Networks Operator

                        

         

12% Secured Debt (Maturity—June 28, 2024)

     1,939     1,939     1,939  

         

Common Stock (10,429 shares)

           256     256  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      2,195     2,195  

                               

Harris Preston Fund Investments(12)(13)

   August 9, 2017  

Investment Partnership

                        

         

LP Interests (HPEP 3, L.P.) (Fully diluted 8.2%)

           2,474     2,474  

                               

Hawk Ridge Systems, LLC(13)

   December 2, 2016  

Value-Added Reseller of Engineering Design and Manufacturing Solutions

                        

         

LIBOR Plus 6.00% (Floor 1.00%), Current Coupon 7.71%, Secured Debt (Maturity—December 2, 2021)(9)

     600     600     600  

         

11.00% Secured Debt (Maturity—December 2, 2021)

     13,400     13,335     13,400  

         

Preferred Member Units (226 units)(8)

           2,850     7,900  

         

Preferred Member Units (HRS Services, ULC) (226 units)

           150     420  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      16,935     22,320  

                               

Houston Plating and Coatings, LLC

   January 8, 2003  

Provider of Plating and Industrial Coating Services

                        

         

8.00% Unsecured Convertible Debt (Maturity—May 1, 2022)

     3,000     3,000     4,260  

         

Member Units (322,297 units)(8)

           2,352     10,330  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      5,352     14,590  

                               

I-45 SLF LLC(12)(13)

   October 20, 2015  

Investment Partnership

                        

         

Member Units (Fully diluted 20.0%; 24.4% profits interest)(8)

           17,000     14,407  

                               

39

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2019

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   

L.F. Manufacturing Holdings, LLC(10)

   December 23, 2013  

Manufacturer of Fiberglass Products

                        

         

Preferred Member Units (non-voting; 14% cumulative)(8)(19)

           81     81  

         

Member Units (2,179,001 units)

           2,019     2,050  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      2,100     2,131  

                               

OnAsset Intelligence, Inc.

   April 18, 2011  

Provider of Transportation Monitoring / Tracking Products and Services

                        

         

12.00% PIK Secured Debt (Maturity—June 30, 2021)(19)

     6,474     6,474     6,474  

         

10.00% PIK Unsecured Debt (Maturity—June 30, 2021)(19)

     58     58     58  

         

Preferred Stock (912 shares)

           1,981     —  

         

Warrants (5,333 equivalent shares; Expiration—April 18, 2021; Strike price—$0.01 per share)

           1,919     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      10,432     6,532  

                               

PCI Holding Company, Inc.

   December 18, 2012  

Manufacturer of Industrial Gas Generating Systems

                        

         

12.00% Current, Secured Debt (Maturity—March 31, 2020)

     11,356     11,356     11,356  

         

Preferred Stock (1,740,000 shares) (non-voting)

           1,740     4,350  

         

Preferred Stock (1,500,000 shares)

           3,927     2,680  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      17,023     18,386  

                               

Rocaceia, LLC (Quality Lease and Rental Holdings, LLC)

   January 8, 2013  

Provider of Rigsite Accommodation Unit Rentals and Related Services

                        

         

12.00% Secured Debt (Maturity—January 8, 2018)(14)(15)

     30,369     29,865     —  

         

Preferred Member Units (250 units)

           2,500     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      32,365     —  

                               

Salado Stone Holdings, LLC (10)

   June 27, 2016  

Limestone and Sandstone Dimension Cut Stone Mining Quarries

                        

         

Class A Preferred Units (Salado Acquisition, LLC) (2,000,000 units)

           2,000     570  

                               

SI East, LLC

   August 31, 2018  

Rigid Industrial Packaging Manufacturing

                        

         

9.50% Current, Secured Debt (Maturity—August 31, 2023)

     32,963     32,687     32,963  

         

Preferred Member Units (157 units)(8)

           6,000     8,200  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      38,687     41,163  

                               

Slick Innovations, Inc.

   September 13, 2018  

Text Message Marketing Platform

                        

         

14.00% Current, Secured Debt (Maturity—September 13, 2023)

     6,360     6,197     6,197  

         

Common Stock (70,000 shares)(8)

           700     1,080  

         

Warrants (18,084 equivalent units; Expiration—September 13, 2028; Strike price—$0.01 per unit)

           181     290  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      7,078     7,567  

                               

40

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2019

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   

UniTek Global Services, Inc.(11)

   April 15, 2011  

Provider of Outsourced Infrastructure Services

                        

         

LIBOR Plus 6.50% (Floor 1.00%), Current Coupon 8.41%, Secured Debt (Maturity—August 20, 2024)(9)

     2,963     2,940     2,962  

         

Preferred Stock (755,401 shares; 20% cumulative)(8)(19)

           809     1,889  

         

Preferred Stock (1,521,122 shares; 19% cumulative)(8)(19)

           1,976     2,282  

         

Preferred Stock (2,281,682 shares; 19% cumulative)(8)(19)

           3,667     3,667  

         

Preferred Stock (4,336,866 shares; 13.50% cumulative)(8)(19)

           7,924     2,684  

         

Common Stock (945,507 shares)

           —     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      17,316     13,484  

                               

Universal Wellhead Services Holdings, LLC(10)

   October 30, 2014  

Provider of Wellhead Equipment, Designs, and Personnel to the Oil & Gas Industry

                        

         

Preferred Member Units (UWS Investments, LLC) (716,949 units; 14% cumulative)(8)(19)

           1,032     800  

         

Member Units (UWS Investments, LLC) (4,000,000 units)

           4,000     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      5,032     800  

                               

Volusion, LLC

   January 26, 2015  

Provider of Online Software-as-a-Service eCommerce Solutions

                        

         

11.50% Secured Debt (Maturity—January 26, 2020)

     20,234     20,162     19,352  

         

8.00% Unsecured Convertible Debt (Maturity—November 16, 2023)

     409     409     291  

         

Preferred Member Units (4,876,670 units)

           14,000     14,000  

         

Warrants (1,831,355 equivalent units; Expiration—January 26, 2025; Strike price—$0.01 per unit)

           2,576     150  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      37,147     33,793  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Subtotal Affiliate Investments (21.5% of net assets at fair value)

   $ 351,764   $ 330,287  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

41

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2019

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   

Non-Control/Non-Affiliate Investments(7)

  

 

                    

                               

AAC Holdings, Inc.(11)

   June 30, 2017  

Substance Abuse Treatment Service Provider

                        

         

LIBOR Plus 11.00% (Floor 1.00%), Current Coupon 13.03%, Secured Debt (Maturity—April 15, 2020)(9)(14)

     2,227     2,068     2,172  

                               

         

LIBOR Plus 12.75% (Floor 1.00%), Current Coupon 16.50%, Secured Debt (Maturity—June 30, 2023)(9)(14)

     14,396     14,030     9,358  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      16,098     11,530  

Adams Publishing Group, LLC(10)

   November 19, 2015  

Local Newspaper Operator

                        

         

Prime Plus 5.00% (Floor 1.50%), Current Coupon 8.75%, Secured Debt (Maturity—July 3, 2023)(9)

     5,000     4,930     5,000  

         

LIBOR Plus 7.50% (Floor 1.50%), Current Coupon 9.44%, Secured Debt (Maturity—July 3, 2023)(9)

     6,158     6,058     6,158  

         

LIBOR Plus 7.50% (Floor 1.50%), Current Coupon 9.50%, Secured Debt (Maturity—July 3, 2023)(9)

     197     197     197  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      11,185     11,355  

                               

ADS Tactical, Inc.(10)

   March 7, 2017  

Value-Added Logistics and Supply Chain Provider to the Defense Industry

                        

         

LIBOR Plus 6.25% (Floor 0.75%), Current Coupon 8.03%, Secured Debt (Maturity—July 26, 2023)(9)

     19,843     19,703     19,843  

                               

Aethon United BR LP(10)

   September 8, 2017  

Oil & Gas Exploration & Production

                        

         

LIBOR Plus 6.75% (Floor 1.00%), Current Coupon 8.46%, Secured Debt (Maturity—September 8, 2023)(9)

     9,750     9,630     9,531  

                               

Affordable Care Holding Corp.(10)

   May 9, 2019  

Dental Service Organization

                        

         

LIBOR Plus 4.75% (Floor 1.00%), Current Coupon 6.59%,

     14,396     14,126     14,036  

         

Secured Debt (Maturity—October 22, 2022)(9)

                    

                               

ALKU, LLC.(11)

   October 18, 2019  

Specialty National Staffing Operator

                        

         

LIBOR Plus 5.50% (Floor 1.00%), Current Coupon 7.44%, Secured Debt (Maturity—July 29, 2026)(9)

     10,000     9,902     9,883  

                               

Allen Media, LLC.(11)

   September 18, 2018  

Operator of Cable Television Networks

                        

         

LIBOR Plus 6.50% (Floor 1.00%), Current Coupon 8.48%, Secured Debt (Maturity—August 30, 2023)(9)

     16,270     15,894     15,863  

                               

Allen Media Broadcasting LLC(10)

   July 3, 2019  

Operator of Television Broadcasting Networks

                        

         

LIBOR Plus 6.25% (Floor 1.00%), Current Coupon 8.21%, Secured Debt (Maturity—July 3, 2024)(9)

     14,906     14,565     14,565  

                               

American Nuts, LLC(10)

   April 10, 2018  

Roaster, Mixer and Packager of Bulk Nuts and Seeds

  

LIBOR Plus 9.50% (Floor 1.00%), Current Coupon 11.60%, Secured Debt (Maturity—April 10, 2023)(9)

     12,243     12,002     12,233  

                               

42

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2019

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   

American Teleconferencing Services, Ltd.(11)

   May 19, 2016  

Provider of Audio Conferencing and Video Collaboration Solutions

                        

         

LIBOR Plus 6.50% (Floor 1.00%), Current Coupon 8.36%, Secured Debt (Maturity—June 8, 2023)(9)

     17,389     16,421     10,460  

                               

APTIM Corp.(11)

   August 17, 2018  

Engineering, Construction & Procurement

                        

         

7.75% Secured Debt (Maturity—June 15, 2025)

     12,452     10,836     7,471  

                               

Arcus Hunting LLC(10)

   January 6, 2015  

Manufacturer of Bowhunting and Archery Products and Accessories

                        

         

LIBOR Plus 10.00% (Floor 1.00%), Current Coupon 12.10%, Secured Debt (Maturity—January 13, 2020)(9)

     13,857     13,856     13,856  

                               

ASC Ortho Management Company, LLC(10)

   August 31, 2018  

Provider of Orthopedic Services

                        

         

LIBOR Plus 7.50% (Floor 1.00%), Current Coupon 9.60%, Secured Debt (Maturity—August 31, 2023)(9)

     4,543     4,465     4,490  

         

13.25% PIK Secured Debt (Maturity—December 1, 2023)(19)

     1,854     1,821     1,854  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      6,286     6,344  

                               

ATI Investment Sub, Inc.(11)

   July 11, 2016  

Manufacturer of Solar Tracking Systems

                        

         

LIBOR Plus 7.25% (Floor 1.00%), Current Coupon 9.01%, Secured Debt (Maturity—June 22, 2021)(9)

     2,885     2,859     2,853  

                               

ATX Networks Corp.(11)(13)(21)

   June 30, 2015  

Provider of Radio Frequency Management Equipment

                        

         

LIBOR Plus 6.00% (Floor 1.00%) Current Coupon 7.94% / 1.00% PIK, Current Coupon Plus PIK 8.94% Secured Debt (Maturity—June 11, 2021)(9)(19)

     13,593     13,414     12,743  

                               

Barfly Ventures, LLC(10)

   August 31, 2015  

Casual Restaurant Group

                        

         

12.00% Secured Debt (Maturity—August 31, 2020)

     10,185     10,073     7,736  

         

Options (3 equivalent units)

           607     —  

         

Warrant (2 equivalent unit; Expiration—August 31, 2025; Strike price—$1.00 per unit)

           473     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      11,153     7,736  

                               

Berry Aviation, Inc.(10)

   July 6, 2018  

Charter Airline Services

                        

         

10.50% Current / 1.5% PIK, Secured Debt (Maturity—January 6, 2024)(19)

     4,554     4,518     4,554  

         

Preferred Member Units (Berry Acquisition, LLC) (122,416 units; 16% cumulative)(8)(19)

           125     125  

         

Preferred Member Units (Berry Acquisition, LLC) (1,548,387 units; 8% cumulative)(8)(19)

           1,671     776  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      6,314     5,455  

                               

43

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2019

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   

BigName Commerce, LLC(10)

   May 11, 2017  

Provider of Envelopes and Complimentary Stationery Products

                        

         

LIBOR Plus 7.25% (Floor 1.00%), Current Coupon 9.35%, Secured Debt (Maturity—May 11, 2022)(9)

     2,233     2,218     2,233  

                               

Binswanger Enterprises, LLC(10)

   March 10, 2017  

Glass Repair and Installation Service Provider

                        

         

LIBOR Plus 8.50% (Floor 1.00%), Current Coupon 10.41%, Secured Debt (Maturity—March 9, 2022)(9)

     13,731     13,443     13,731  

         

Member Units (1,050,000 units)

           1,050     950  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      14,493     14,681  

                               

Bluestem Brands, Inc.(11)

   December 19, 2013  

Multi-Channel Retailer of General Merchandise

                        

         

LIBOR Plus 7.50% (Floor 1.00%), Current Coupon 9.31%, Secured Debt (Maturity—November 6, 2020)(9)

     10,622     10,571     7,973  

                               

Bojangles', Inc.(11)

   February 5, 2019  

Quick Service Restaurant Group

                        

         

LIBOR Plus 4.75%, Current Coupon 6.50%, Secured Debt (Maturity—January 28, 2026)

     7,782     7,642     7,827  

         

LIBOR Plus 8.50%, Current Coupon 10.25%, Secured Debt (Maturity—January 28, 2027)

     5,000     4,907     5,012  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      12,549     12,839  

                               

Brainworks Software, LLC(10)

   August 12, 2014  

Advertising Sales and Newspaper Circulation Software

                        

         

4.00% Secured Debt (Maturity—July 22, 2019)(9)(17)

     6,733     6,733     5,955  

                               

Brightwood Capital Fund Investments(12)(13)

   July 21, 2014  

Investment Partnership

                        

         

LP Interests (Brightwood Capital Fund III, LP) (Fully diluted 1.6%)(8)

           11,160     9,005  

         

LP Interests (Brightwood Capital Fund IV, LP) (Fully diluted 0.6%)(8)

           4,500     4,504  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      15,660     13,509  

                               

Cadence Aerospace LLC(10)

   November 14, 2017  

Aerostructure Manufacturing

                        

         

LIBOR Plus 6.50% (Floor 1.00%), Current Coupon 8.40%, Secured Debt (Maturity—November 14, 2023)(9)

     25,287     25,089     25,287  

                               

California Pizza Kitchen, Inc.(11)

   August 29, 2016  

Casual Restaurant Group

                        

         

LIBOR Plus 6.00% (Floor 1.00%), Current Coupon 7.91%, Secured Debt (Maturity—August 23, 2022)(9)

     14,599     14,501     12,739  

                               

Central Security Group, Inc.(11)

   December 4, 2017  

Security Alarm Monitoring Service Provider

                        

         

LIBOR Plus 5.63% (Floor 1.00%), Current Coupon 7.38%, Secured Debt (Maturity—October 6, 2021)(9)

     13,776     13,734     11,985  

                               

44

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2019

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   

Cenveo Corporation(11)

   September 4, 2015  

Provider of Digital Marketing Agency Services

                        

         

Libor Plus 9.50% (Floor 1.00%), Current Coupon 11.45%, Secured Debt (Maturity—June 7, 2023)(9)

     5,674     5,498     5,674  

         

Common Stock (177,130 shares)

           5,309     2,923  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      10,807     8,597  

                               

Chisholm Energy Holdings, LLC(10)

   May 15, 2019  

Oil & Gas Exploration & Production

                        

         

LIBOR Plus 6.25% (Floor 1.50%), Current Coupon 8.16%, Secured Debt (Maturity—May 15, 2026)(9)

     3,571     3,488     3,488  

                               

Clarius BIGS, LLC(10)

   September 23, 2014  

Prints & Advertising Film Financing

                        

         

15% PIK Secured Debt (Maturity—January 5, 2015)(14)(17)

     2,846     2,846     40  

                               

Clickbooth.com, LLC(10)

   December 5, 2017  

Provider of Digital Advertising Performance Marketing Solutions

                        

         

LIBOR Plus 8.50% (Floor 1.00%), Current Coupon 10.59%, Secured Debt (Maturity—December 5, 2022)(9)

     2,663     2,625     2,663  

                               

Construction Supply Investments, LLC(10)

   December 29, 2016  

Distribution Platform of Specialty Construction Materials to Professional Concrete and Masonry Contractors

                        

         

Member Units (46,152 units)

           4,866     7,667  

                               

Corel Corporation(11)(13)(21)

   July 24, 2019  

Publisher of Desktop and Cloud-based Software

                        

         

LIBOR Plus 5.00% (Floor 1.00%), Current Coupon 6.91%, Secured Debt (Maturity—July 2, 2026)(9)

     15,000     14,293     14,531  

                               

CTVSH, PLLC(10)

   August 3, 2017  

Emergency Care and Specialty Service Animal Hospital

                        

         

LIBOR Plus 8.00% (Floor 1.00%), Current Coupon 9.91%, Secured Debt (Maturity—August 3, 2022)(9)

     10,099     10,039     10,099  

                               

Darr Equipment LP(10)

   April 15, 2014  

Heavy Equipment Dealer

                        

         

11.5% Current / 1% PIK Secured Debt (Maturity -June 22, 2023)(19)

     5,899     5,899     5,899  

         

Warrants (915,734 equivalent units; Expiration—December 23, 2023; Strike price—$1.50 per unit)

           474     300  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      6,373     6,199  

                               

Digital River, Inc.(11)

   February 24, 2015  

Provider of Outsourced e-Commerce Solutions and Services

                        

         

LIBOR Plus 6.00% (Floor 1.00%), Current Coupon 7.90%, Secured Debt (Maturity—February 12, 2021)(9)

     15,876     15,771     15,837  

                               

45

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2019

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   

DTE Enterprises, LLC(10)

   April 13, 2018  

Industrial Powertrain Repair and Services

                        

         

LIBOR Plus 7.50% (Floor 1.50%), Current Coupon 9.24%, Secured Debt (Maturity—April 13, 2023)(9)

     10,992     10,827     10,982  

         

Class AA Preferred Member Units (non-voting; 10% cumulative)(8)(19)

           860     860  

         

Class A Preferred Member Units (776,316 units)

           776     1,490  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      12,463     13,332  

                               

Dynamic Communities, LLC(10)

   July 17, 2018  

Developer of Business Events and Online Community Groups

                        

         

LIBOR Plus 8.00% (Floor 1.00%), Current Coupon 9.75%, Secured Debt (Maturity—July 17, 2023)(9)

     5,460     5,375     5,458  

                               

Echo US Holdings, LLC.(10)

   November 12, 2019  

Developer and Manufacturer of PVC and Polypropylene Materials

                        

         

LIBOR Plus 6.25% (Floor 1.63%), Current Coupon 7.96%, Secured Debt (Maturity—October 25, 2024)(9)

     22,414     22,292     22,292  

                               

EnCap Energy Fund Investments(12)(13)

   December 28, 2010  

Investment Partnership

                        

         

LP Interests (EnCap Energy Capital Fund VIII, L.P.) (Fully diluted 0.1%)(8)

           3,617     1,354  

         

LP Interests (EnCap Energy Capital Fund VIII Co-Investors, L.P.) (Fully diluted 0.4%)

           2,097     703  

         

LP Interests (EnCap Energy Capital Fund IX, L.P.) (Fully diluted 0.1%)(8)

           4,360     2,780  

         

LP Interests (EnCap Energy Capital Fund X, L.P.) (Fully diluted 0.1%)(8)

           8,427     8,822  

         

LP Interests (EnCap Flatrock Midstream Fund II, L.P.) (Fully diluted 0.8%)(8)

           7,337     5,669  

         

LP Interests (EnCap Flatrock Midstream Fund III, L.P.) (Fully diluted 0.2%)(8)

           6,674     6,677  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      32,512     26,005  

                               

Encino Acquisition Partners Holdings, Inc.(11)

   November 16, 2018  

Oil & Gas Exploration & Production

                        

         

LIBOR Plus 6.75% (Floor 1.00%), Current Coupon 8.50%, Secured Debt (Maturity—October 29, 2025)(9)

     9,000     8,921     6,795  

                               

EPIC Y-Grade Services, LP(11)

   June 22, 2018  

NGL Transportation & Storage

                        

         

LIBOR Plus 6.00%, Current Coupon 8.04%, Secured Debt (Maturity—June 13, 2024)

     10,275     10,116     10,050  

                               

Evergreen Skills Lux S.á r.l. (d/b/a Skillsoft)(11)(13)

   May 5, 2014  

Technology-based Performance Support Solutions

                        

         

LIBOR Plus 8.25% (Floor 1.00%), Current Coupon 10.45%, Secured Debt (Maturity—April 28, 2022)(9)

     6,999     6,928     1,965  

                               

46

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2019

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   

Felix Investments Holdings II(10)

   August 9, 2017  

Oil & Gas Exploration & Production

                        

         

LIBOR Plus 6.50% (Floor 1.00%), Current Coupon 8.40%, Secured Debt (Maturity—August 9, 2022)(9)

     5,000     4,944     5,000  

                               

Flavors Holdings Inc.(11)

   October 15, 2014  

Global Provider of Flavoring and Sweetening Products

                        

         

LIBOR Plus 5.75% (Floor 1.00%), Current Coupon 7.77%, Secured Debt (Maturity—April 3, 2020)(9)

     11,297     11,247     10,619  

                               

Fortna, Inc.(10)

   July 23, 2019  

Process, Physcial Distribution and Logistics Consulting Services

                        

         

LIBOR Plus 5.00%, Current Coupon 6.75%, Secured Debt (Maturity—April 8, 2025)

     7,751     7,577     7,577  

                               

GeoStabilization International (GSI)(11)

   December 31, 2018  

Geohazard Engineering Services & Maintenance

                        

         

LIBOR Plus 5.25%, Current Coupon 7.05%, Secured Debt (Maturity—December 19, 2025)

     16,376     16,230     16,335  

                               

GoWireless Holdings, Inc. (11)

   December 31, 2017  

Provider of Wireless Telecommunications Carrier Services

                        

         

LIBOR Plus 6.50% (Floor 1.00%), Current Coupon 8.25%, Secured Debt (Maturity—December 22, 2024)(9)

     18,120     17,964     17,471  

                               

Grupo Hima San Pablo, Inc.(11)

   March 7, 2013  

Tertiary Care Hospitals

                        

         

LIBOR Plus 7.00% (Floor 1.50%), Current Coupon 8.91%, Secured Debt (Maturity—April 30, 2019)(9)(17)

     4,504     4,504     3,343  

         

13.75% Secured Debt (Maturity—October 15, 2018)(17)

     2,055     2,040     167  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      6,544     3,510  

                               

GS HVAM Intermediate, LLC(10)

   October 18, 2019  

Specialized Food Distributor

                        

         

LIBOR Plus 5.75% (Floor 1.00%), Current Coupon 7.51%, Secured Debt (Maturity—October 2, 2024)(9)

     11,364     11,233     11,233  

                               

HDC/HW Intermediate Holdings(10)

   December 21, 2018  

Managed Services and Hosting Provider

                        

         

LIBOR Plus 7.50% (Floor 1.00%), Current Coupon 9.53%, Secured Debt (Maturity—December 21, 2023)(9)

     3,498     3,440     3,493  

                               

Hoover Group, Inc.(10)(13)

   October 21, 2016  

Provider of Storage Tanks and Related Products to the Energy and Petrochemical Markets

                        

         

LIBOR Plus 7.25% (Floor 1.00%), Current Coupon 9.26%, Secured Debt (Maturity—January 28, 2021)(9)

     20,764     20,119     19,206  

                               

Hunter Defense Technologies, Inc.(10)

   March 29, 2018  

Provider of Military and Commercial Shelters and Systems

                        

         

LIBOR Plus 7.00% (Floor 1.00%), Current Coupon 9.02%, Secured Debt (Maturity—March 29, 2023)(9)

     29,097     28,659     29,097  

                               

47

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2019

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   

HW Temps LLC

   July 2, 2015  

Temporary Staffing Solutions

  

8.00% Secured Debt (Maturity—March 29, 2023)

     10,181     10,025     8,913  

                               

Hydrofarm Holdings LLC(10)

   May 18, 2017  

Wholesaler of Horticultural Products

                        

         

LIBOR Plus 10.00%, Current Coupon 3.54% / 8.26% PIK, Current Coupon Plus PIK 11.80% Secured Debt (Maturity—May 12, 2022)(19)

     7,660     7,547     6,414  

                               

Hyperion Materials & Technologies, Inc.(11)(13)

   September 12, 2019  

Manufacturer of Cutting and Machine Tools & Speciality Polishing Compounds

                        

         

LIBOR Plus 5.50% (Floor 1.00%), Current Coupon 7.25%, Secured Debt (Maturity—August 28, 2026)(9)

     22,500     22,066     22,275  

                               

iEnergizer Limited(10)(13)(21)

   April 17, 2019  

Provider of Business Outsourcing Solutions

                        

         

LIBOR Plus 6.00% (Floor 1.00%), Current Coupon 7.79%, Secured Debt (Maturity—April 17, 2024)(9)

     12,963     12,848     12,962  

                               

Implus Footcare, LLC(10)

   June 1, 2017  

Provider of Footwear and Related Accessories

                        

         

LIBOR Plus 6.25% (Floor 1.00%), Current Coupon 8.27%, Secured Debt (Maturity—April 30, 2024)(9)

     18,577     18,178     18,217  

                               

Independent Pet Partners Intermediate Holdings, LLC(10)

   November 20, 2018  

Omnichannel Retailer of Specialty Pet Products

                        

         

LIBOR Plus 9.00% (Floor 1.00%), Current Coupon 11.28%, Secured Debt (Maturity—November 19, 2023)(9)

     18,799     18,487     18,799  

         

Member Units (1,558,333 units)

           1,558     1,260  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      20,045     20,059  

                               

Industrial Services Acquisition, LLC(10)

   June 17, 2016  

Industrial Cleaning Services

                        

         

6% Current / 7% PIK Unsecured Debt (Maturity—December 17, 2022)(19)

     5,242     5,174     5,242  

         

Preferred Member Units (Industrial Services Investments, LLC) (144 units; 10% cumulative)(8)(19)

           103     103  

         

Preferred Member Units (Industrial Services Investments, LLC) (80 units; 20% cumulative)(8)(19)

           60     60  

         

Member Units (Industrial Services Investments, LLC) (900 units)

           900     510  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      6,237     5,915  

                               

Inn of the Mountain Gods Resort and Casino(11)

   October 30, 2013  

Hotel & Casino Owner & Operator

                        

         

9.25% Secured Debt (Maturity—November 30, 2020)

     7,762     7,584     7,684  

                               

Interface Security Systems, L.L.C(10)

   August 7, 2019  

Commercial Security & Alarm Services

                        

         

LIBOR Plus 7.00% (Floor 1.75%), Current Coupon 8.77%, Secured Debt (Maturity—August 7, 2023)(9)

     7,500     7,363     7,363  

                               

Intermedia Holdings, Inc.(11)

   August 3, 2018  

Unified Communications as a Service

  

LIBOR Plus 6.00% (Floor 1.00%), Current Coupon 7.75%, Secured Debt (Maturity—July 19, 2025)(9)

     20,130     20,033     20,180  

                               

48

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2019

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   

Invincible Boat Company, LLC.(10)

   August 28, 2019  

Manufacturer of Sport Fishing Boats

                        

         

LIBOR Plus 6.50% (Floor 1.00%), Current Coupon 8.53%, Secured Debt (Maturity—August 28, 2025)(9)

     9,872     9,773     9,773  

                               

Isagenix International, LLC(11)

   June 21, 2018  

Direct Marketer of Health & Wellness Products

                        

         

LIBOR Plus 5.75% (Floor 1.00%), Current Coupon 7.77%, Secured Debt (Maturity—June 14, 2025)(9)

     5,943     5,893     4,273  

                               

JAB Wireless, Inc.(10)

   May 2, 2018  

Fixed Wireless Broadband Provider

                        

         

LIBOR Plus 8.00% (Floor 1.00%), Current Coupon 9.74%, Secured Debt (Maturity—May 2, 2023)(9)

     14,775     14,669     14,775  

                               

Jackmont Hospitality, Inc.(10)

   May 26, 2015  

Franchisee of Casual Dining Restaurants

                        

         

LIBOR Plus 6.75% (Floor 1.00%), Current Coupon 8.45%, Secured Debt (Maturity—May 26, 2021)(9)

     4,059     4,055     4,059  

                               

Joerns Healthcare, LLC(11)

   April 3, 2013  

Manufacturer and Distributor of Health Care Equipment & Supplies

                        

         

LIBOR Plus 6.00% (Floor 1.00%), Current Coupon 7.91% Secured Debt (Maturity—August 21, 2024)(9)

     4,016     3,942     3,942  

         

Common Stock (472,579 shares)

           4,429     4,429  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      8,371     8,371  

                               

Kemp Technologies Inc.(10)

   June 27, 2019  

Provider of Application Delivery Controllers

                        

         

LIBOR Plus 6.25% (Floor 1.00%), Current Coupon 8.00%, Secured Debt (Maturity—March 29, 2024)(9)

     7,462     7,326     7,463  

                               

Kore Wireless Group Inc.(11)

   December 31, 2018  

Mission Critical Software Platform

                        

         

LIBOR Plus 5.50%, Current Coupon 7.52%, Secured Debt (Maturity—December 20, 2024)

     19,285     19,189     19,164  

                               

Larchmont Resources, LLC(11)

   August 13, 2013  

Oil & Gas Exploration & Production

                        

         

LIBOR Plus 7.00% (Floor 1.00%), Current Coupon 8.89%, Secured Debt (Maturity—August 7, 2020)(9)

     2,145     2,145     1,990  

         

Member Units (Larchmont Intermediate Holdco, LLC) (2,828 units)

           353     707  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      2,498     2,697  

                               

Laredo Energy VI, LP(10)

   January 15, 2019  

Oil & Gas Exploration & Production

                        

         

LIBOR Plus 9.63% (Floor 2.00%), Current Coupon 5.38% / 6.26% PIK, Current Coupon Plus PIK 11.64%, Secured Debt (Maturity—November 19, 2021)(9)(19)

     11,312     11,166     10,638  

                               

Lightbox Holdings, L.P.(11)

   May 23, 2019  

Provider of Commercial Real Estate Software

  

LIBOR Plus 5.00%, Current Coupon 6.74%, Secured Debt (Maturity—May 9, 2026)

     14,925     14,713     14,738  

                               

LKCM Headwater Investments I, L.P.(12)(13)

   January 25, 2013  

Investment Partnership

                        

         

LP Interests (Fully diluted 2.3%)(8)

           1,746     3,682  

                               

49

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2019

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   

LL Management, Inc.(10)

   May 2, 2019  

Medical Transportation Service Provider

                        

         

LIBOR Plus 6.50% (Floor 1.00%), Current Coupon 8.56%, Secured Debt (Maturity—September 25, 2023)(9)

     13,754     13,625     13,751  

                               

Logix Acquisition Company, LLC(10)

   June 24, 2016  

Competitive Local Exchange Carrier

                        

         

LIBOR Plus 5.75% (Floor 1.00%), Current Coupon 7.50%, Secured Debt (Maturity—December 22, 2024)(9)

     18,381     18,199     18,197  

                               

Looking Glass Investments, LLC(12)(13)

   July 1, 2015  

Specialty Consumer Finance

                        

         

Member Units (2.5 units)

           125     25  

         

Member Units (LGI Predictive Analytics LLC) (190,712 units)

           49     16  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      174     41  

                               

LSF9 Atlantis Holdings, LLC(11)

   May 17, 2017  

Provider of Wireless Telecommunications Carrier Services

                        

         

LIBOR Plus 6.00% (Floor 1.00%), Current Coupon 7.74%, Secured Debt (Maturity—May 1, 2023)(9)

     9,458     9,458     8,761  

                               

Lulu's Fashion Lounge, LLC(10)

   August 31, 2017  

Fast Fashion E-Commerce Retailer

                        

         

LIBOR Plus 9.00% (Floor 1.00%), Current Coupon 10.75%, Secured Debt (Maturity—August 28, 2022)(9)

     11,335     11,070     11,109  

                               

Lynx FBO Operating LLC(10)

   September 30, 2019  

Fixed Based Operator in the General Aviation Industry

                        

         

LIBOR Plus 5.75% (Floor 1.00%), Current Coupon 7.86%, Secured Debt (Maturity—September 30, 2024)(9)

     13,750     13,451     13,451  

         

Member Units (3,704 units)

           500     500  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      13,951     13,951  

                               

Mac Lean-Fogg Company(10)

   April 22, 2019  

Manufacturer and Supplier for Auto and Power Markets

                        

         

LIBOR Plus 5.00%, Current Coupon 6.75%, Secured Debt (Maturity—December 22, 2025)

     16,648     16,528     16,643  

         

Preferred Stock (1,516 shares; 4.50% Cash / 9.25% PIK cumulative)(8)(19)

           1,775     1,775  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      18,303     18,418  

                               

MHVC Acquisition Corp.(11)

   May 8, 2017  

Provider of differentiated information solutions, systems engineering, and analytics

  

LIBOR Plus 5.25% (Floor 1.00%), Current Coupon 7.01%, Secured Debt (Maturity—April 29, 2024)(9)

     19,950     19,855     19,950  

                               

Mills Fleet Farm Group, LLC(10)

   October 24, 2018  

Omnichannel Retailer of Work, Farm and Lifestyle Merchandise

                        

         

LIBOR Plus 6.25% (Floor 1.00%), Current Coupon 8.29% / 0.75% PIK, Current Coupon Plus PIK 9.04%, Secured Debt (Maturity—October 24, 2024)(9)(19)

     14,879     14,556     14,187  

                               

50

Table of Contents


MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2019

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   

NBG Acquisition Inc(11)

   April 28, 2017  

Wholesaler of Home Décor Products

                        

         

LIBOR Plus 5.50% (Floor 1.00%), Current Coupon 7.52%, Secured Debt (Maturity—April 26, 2024)(9)

     4,181     4,134     3,247  

                               

NinjaTrader, LLC(10)

   December 18, 2019  

Operator of Futures Trading Platform

                        

         

LIBOR Plus 6.00% (Floor 1.50%), Current Coupon 7.90%, Secured Debt (Maturity—December 18, 2024)(9)

     9,675     9,490     9,490  

                               

NNE Partners, LLC(10)

   March 2, 2017  

Oil & Gas Exploration & Production

                        

         

LIBOR Plus 8.00%, Current Coupon 9.91%, Secured Debt (Maturity—March 2, 2022)

     23,417     23,268     23,147  

                               

North American Lifting Holdings, Inc.(11)

   February 26, 2015  

Crane Service Provider

                        

         

LIBOR Plus 4.50% (Floor 1.00%), Current Coupon 6.52%, Secured Debt (Maturity—November 27, 2020)(9)

     7,584     7,300     6,417  

                               

Novetta Solutions, LLC(11)

   June 21, 2017  

Provider of Advanced Analytics Solutions for Defense Agencies

                        

         

LIBOR Plus 5.00% (Floor 1.00%), Current Coupon 6.76%, Secured Debt (Maturity—October 17, 2022)(9)

     21,060     20,673     20,749  

                               

NTM Acquisition Corp.(11)

   July 12, 2016  

Provider of B2B Travel Information Content

                        

         

LIBOR Plus 6.25% (Floor 1.00%), Current Coupon 8.00%, Secured Debt (Maturity—June 7, 2022)(9)

     4,879     4,874     4,879  

                               

Ospemifene Royalty Sub LLC (QuatRx)(10)

   July 8, 2013  

Estrogen-Deficiency Drug Manufacturer and Distributor

                        

         

11.5% Secured Debt (Maturity—November 15, 2026)(14)

     4,868     4,868     463  

                               

PaySimple, Inc.(10)

   September 9, 2019  

Leading technology services commerce platform

                        

         

LIBOR Plus 5.50% (Floor 1.00%), Current Coupon 7.28%, Secured Debt (Maturity—August 23, 2025)(9)

     15,845     15,586     15,766  

                               

Permian Holdco 2, Inc.(11)

   February 12, 2013  

Storage Tank Manufacturer

                        

         

14.00% PIK Unsecured Debt (Maturity—October 15, 2021)(19)

     456     456     341  

         

18.00% PIK Unsecured Debt (Maturity—June 30, 2022)(19)

     319     319     319  

         

Preferred Stock (Permian Holdco 1, Inc.) (154,558 units)

           799     100  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      1,574     760  

                               

Point.360(10)

   July 8, 2015  

Fully Integrated Provider of Digital Media Services

                        

         

Warrants (65,463 equivalent shares; Expiration—July 7, 2020; Strike price—$0.75 per share)

           69     —  

         

Common Stock (163,658 shares)

           273     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      342     —  

                               

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MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2019

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   

PricewaterhouseCoopers Public Sector LLP(11)

   May 24, 2018  

Provider of Consulting Services to Governments

                        

         

LIBOR Plus 8.00%, Current Coupon 9.75%, Secured Debt (Maturity—May 1, 2026)

     9,000     8,965     8,865  

                               

PT Network, LLC(10)

   November 1, 2013  

Provider of Outpatient Physical Therapy and Sports Medicine Services

                        

         

LIBOR Plus 5.50% (Floor 1.00%), Current Coupon 7.44% / 2.00% PIK, Current Coupon Plus PIK 9.44%, Secured Debt (Maturity—November 30, 2023)(9)(19)

     8,491     8,491     8,414  

                               

Research Now Group, Inc. and Survey Sampling International, LLC(11)

   December 31, 2017  

Provider of Outsourced Online Surveying

                        

         

LIBOR Plus 5.50% (Floor 1.00%), Current Coupon 7.41%, Secured Debt (Maturity—December 20, 2024)(9)

     18,115     17,590     18,140  

                               

RM Bidder, LLC(10)

   November 12, 2015  

Scripted and Unscripted TV and Digital Programming Provider

                        

         

Warrants (327,532 equivalent units; Expiration—October 20, 2025; Strike price—$14.28 per unit)

           425     —  

         

Member Units (2,779 units)

           46     18  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      471     18  

                               

SAFETY Investment Holdings, LLC

   April 29, 2016  

Provider of Intelligent Driver Record Monitoring Software and Services

                        

         

Member Units (2,000,000 units)

           2,000     2,380  

                               

Salient Partners L.P.(11)

   June 25, 2015  

Provider of Asset Management Services

                        

         

LIBOR Plus 6.00% (Floor 1.00%), Current Coupon 7.69%, Secured Debt (Maturity—June 9, 2021)(9)

     6,675     6,657     6,675  

                               

SMART Modular Technologies, Inc.(10)(13)

   August 18, 2017  

Provider of Specialty Memory Solutions

                        

         

LIBOR Plus 6.25% (Floor 1.00%), Current Coupon 8.16%, Secured Debt (Maturity—August 9, 2022)(9)

     18,484     18,332     18,669  

                               

Staples Canada ULC(10)(13)(21)

   September 14, 2017  

Office Supplies Retailer

  

LIBOR Plus 7.00% (Floor 1.00%), Current Coupon 8.98%, Secured Debt (Maturity—September 12, 2024)(9)(22)

     14,546     14,348     13,530  

                               

TE Holdings, LLC(11)

   December 5, 2013  

Oil & Gas Exploration & Production

                        

         

Member Units (97,048 units)

           970     —  

                               

TEAM Public Choices, LLC(10)

   October 28, 2019  

Home-Based Care Employment Service Provider

                        

         

LIBOR Plus 6.00% (Floor 1.00%), Current Coupon 7.75%, Secured Debt (Maturity—September 20, 2024)(9)

     16,844     16,680     16,680  

                               

Tectonic Financial, Inc.

   May 15, 2017  

Financial Services Organization

                        

         

Common Stock (400,000 shares)(8)

           2,000     2,620  

                               

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MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2019

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   

TGP Holdings III LLC(11)

   September 30, 2017  

Outdoor Cooking & Accessories

                        

         

LIBOR Plus 8.50% (Floor 1.00%), Current Coupon 10.25%, Secured Debt (Maturity—September 25, 2025)(9)

     5,500     5,440     5,143  

                               

The Pasha Group(11)

   February 2, 2018  

Diversified Logistics and Transportation Provided

                        

         

LIBOR Plus 7.50% (Floor 1.00%), Current Coupon 9.31%, Secured Debt (Maturity—January 26, 2023)(9)

     8,984     8,793     9,074  

                               

TMC Merger Sub Corp.(11)

   December 22, 2016  

Refractory & Maintenance Services Provider

                        

         

LIBOR Plus 6.75% (Floor 1.00%), Current Coupon 8.53%, Secured Debt (Maturity—October 31, 2022)(9)(24)

     15,527     15,394     15,392  

                               

TOMS Shoes, LLC(11)

   November 13, 2014  

Global Designer, Distributor, and Retailer of Casual Footwear

                        

         

LIBOR Plus 5.50% (Floor 1.00%), Current Coupon 7.46%, Secured Debt (Maturity—September 30, 2025)(9)

     571     571     571  

         

LIBOR Plus 5.00% (Floor 1.00%), Current Coupon 6.96%, Secured Debt (Maturity—December 31, 2025)(9)

     1,637     1,637     1,637  

         

Member Units (16,321 units)

           245     245  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      2,453     2,453  

                               

USA DeBusk LLC(10)

   October 22, 2019  

Provider of Industrial Cleaning Services

                        

         

LIBOR Plus 5.75% (Floor 1.00%), Current Coupon 7.54%, Secured Debt (Maturity—October 22, 2024)(9)

     30,000     29,423     29,423  

                               

U.S. TelePacific Corp.(11)

   September 14, 2016  

Provider of Communications and Managed Services

                        

         

LIBOR Plus 5.00% (Floor 1.00%), Current Coupon 7.02%, Secured Debt (Maturity—May 2, 2023)(9)

     17,088     16,887     16,447  

                               

Vida Capital, Inc(11)

   October 10, 2019  

Alternative Asset Manager

  

LIBOR Plus 6.00%, Current Coupon 7.93%, Secured Debt (Maturity—October 1, 2026)

     18,500     18,232     18,315  

                               

VIP Cinema Holdings, Inc.(11)

   March 9, 2017  

Supplier of Luxury Seating to the Cinema Industry

                        

         

LIBOR Plus 8.00% (Floor 1.00%), Current Coupon 9.91%, Secured Debt (Maturity—March 1, 2023)(9)(14)

     10,063     10,030     5,301  

                               

Vistar Media, Inc.(10)

   February 17, 2017  

Operator of Digital Out-of-Home Advertising Platform

                        

         

LIBOR Plus 8.00% (Floor 1.00%), Current Coupon 10.00%, Secured Debt (Maturity—April 3, 2023)(9)

     4,963     4,784     4,939  

         

Preferred Stock (70,207 shares)

           767     1,610  

         

Warrants (69,675 equivalent shares; Expiration—April 3, 2029; Strike price—$10.92 per share)

           —     1,630  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      5,551     8,179  

                               

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MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2019

(dollars in thousands)

Portfolio Company(1)(20)
   Investment Date(26)
   Business Description
   Type of Investment(2)(3)(25)
   Principal(4)
   Cost(4)
   Fair Value(18)
  
   

Wireless Vision Holdings, LLC(10)

   September 29, 2017  

Provider of Wireless Telecommunications Carrier Services

                        

         

LIBOR Plus 9.65% (Floor 1.00%), Current Coupon 11.57% / 1.00% PIK, Current Coupon Plus PIK 12.57%, Secured Debt (Maturity—September 29, 2022)(9)(19)(23)

     7,136     7,022     7,129  

         

LIBOR Plus 8.91% (Floor 1.00%), Current Coupon 10.67% / 1.00% PIK, Current Coupon Plus PIK 11.67%, Secured Debt (Maturity—September 29, 2022)(9)(19)(23)

     6,201     6,132     6,200  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      13,154     13,329  

                               

YS Garments, LLC(11)

   August 22, 2018  

Designer and Provider of Branded Activewear

                        

         

LIBOR Plus 6.00% (Floor 1.00%), Current Coupon 7.60% Secured Debt (Maturity—August 9, 2024)(9)

     14,531     14,412     14,404  

                               

Zilliant Incorporated

   June 15, 2012  

Price Optimization and Margin Management Solutions

                        

         

Preferred Stock (186,777 shares)

           154     260  

         

Warrants (952,500 equivalent shares; Expiration—June 15, 2022; Strike price—$0.001 per share)

           1,071     1,190  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

                      1,225     1,450  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Subtotal Non-Control/Non-Affiliate Investments (80.7% of net assets at fair value)

   $ 1,297,587   $ 1,239,316  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Total Portfolio Investments, December 31, 2019

   $ 2,427,718   $ 2,602,324  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
(1)
All investments are Lower Middle Market portfolio investments, unless otherwise noted. See Note B for a description of Lower Middle Market portfolio investments. All of the Company's investments, unless otherwise noted, are encumbered either as security for the Company's Credit Facility or in support of the SBA-guaranteed debentures issued by the Funds.

(2)
Debt investments are income producing, unless otherwise noted. Equity and warrants are non-income producing, unless otherwise noted.

(3)
See Note C and Schedule 12-14 for a summary of geographic location of portfolio companies.

(4)
Principal is net of repayments. Cost is net of repayments and accumulated unearned income.

(5)
Control investments are defined by the Investment Company Act of 1940, as amended ("1940 Act"), as investments in which more than 25% of the voting securities are owned or where the ability to nominate greater than 50% of the board representation is maintained.

(6)
Affiliate investments are defined by the 1940 Act as investments in which between 5% and 25% (inclusive) of the voting securities are owned and the investments are not classified as Control investments.

(7)
Non-Control/Non-Affiliate investments are defined by the 1940 Act as investments that are neither Control investments nor Affiliate investments.

(8)
Income producing through dividends or distributions.

(9)
Index based floating interest rate is subject to contractual minimum interest rate. A majority of the variable rate loans in the Company's investment portfolio bear interest at a rate that may be determined by reference to either LIBOR or an alternate Base Rate (commonly based on the Federal Funds Rate or the Prime Rate), which typically resets semi-annually, quarterly, or monthly at the borrower's option. The borrower may also elect to have multiple interest reset periods for each loan. For each such loan, the Company has provided the weighted average annual stated interest rate in effect at December 31, 2019. As noted in this schedule, 64% of the loans (based on the par amount) contain LIBOR floors which range between 0.50% and 2.00%, with a weighted-average LIBOR floor of approximately 1.06%.

(10)
Private Loan portfolio investment. See Note B for a description of Private Loan portfolio investments.

(11)
Middle Market portfolio investment. See Note B for a description of Middle Market portfolio investments.

(12)
Other Portfolio investment. See Note B for a description of Other Portfolio investments.

(13)
Investment is not a qualifying asset as defined under Section 55(a) of the 1940 Act. Qualifying assets must represent at least 70% of total assets at the time of acquisition of any additional non-qualifying assets.

(14)
Non-accrual and non-income producing investment.

(15)
Portfolio company is in a bankruptcy process and, as such, the maturity date of our debt investment in this portfolio company will not be finally determined until such process is complete. As noted in footnote (14), our debt investment in this portfolio company is on non-accrual status.

(16)
External Investment Manager. Investment is not encumbered as security for the Company's Credit Facility or in support of the SBA-guaranteed debentures issued by the Funds.

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MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2019

(dollars in thousands)

(17)
Maturity date is under on-going negotiations with the portfolio company and other lenders, if applicable.

(18)
Investment fair value was determined using significant unobservable inputs, unless otherwise noted. See Note C for further discussion.

(19)
PIK interest income and cumulative dividend income represent income not paid currently in cash.

(20)
All portfolio company headquarters are based in the United States, unless otherwise noted.

(21)
Portfolio company headquarters are located outside of the United States.

(22)
In connection with the Company's debt investment in Staples Canada ULC and in an attempt to mitigate any potential adverse change in foreign exchange rates during the term of the Company's investment, the Company maintains a forward foreign currency contract with Cadence Bank to lend $17.6 million Canadian Dollars and receive $13.4 million U.S. Dollars with a settlement date of September 14, 2020. The unrealized depreciation on the forward foreign currency contract is $0.2 million as of December 31, 2019.

(23)
The Company has entered into an intercreditor agreement that entitles the Company to the "last out" tranche of the first lien secured loans, whereby the "first out" tranche will receive priority as to the "last out" tranche with respect to payments of principal, interest, and any other amounts due thereunder. Therefore, the Company receives a higher interest rate than the contractual stated interest rate of LIBOR plus 8.50% (Floor 1.00%) per the credit agreement and the Consolidated Schedule of Investments above reflects such higher rate.

(24)
The Company has entered into an intercreditor agreement that entitles the Company to the "first out" tranche of the first lien secured loans, whereby the "first out" tranche will receive priority as to the "last out" tranche with respect to payments of principal, interest, and any other amounts due thereunder. Therefore, the Company receives a lower interest rate than the contractual stated interest rate of LIBOR plus 7.14% (Floor 1.00%) per the credit agreement and the Consolidated Schedule of Investments above reflects such lower rate.

(25)
All of the Company's portfolio investments are generally subject to restrictions on resale as "restricted securities."

(26)
Investment date represents the date of initial investment in the portfolio company.

(27)
Investment has an unfunded commitment as of December 31, 2019 (see Note K). The fair value of the investment includes the impact of the fair value of any unfunded commitments.

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MAIN STREET CAPITAL CORPORATION

Notes to Consolidated Financial Statements

(Unaudited)

NOTE A—ORGANIZATION AND BASIS OF PRESENTATION

1.     Organization

        Main Street Capital Corporation ("MSCC") is a principal investment firm primarily focused on providing customized debt and equity financing to lower middle market ("LMM") companies and debt capital to middle market ("Middle Market") companies. The portfolio investments of MSCC and its consolidated subsidiaries are typically made to support management buyouts, recapitalizations, growth financings, refinancings and acquisitions of companies that operate in a variety of industry sectors. MSCC seeks to partner with entrepreneurs, business owners and management teams and generally provides "one stop" financing alternatives within its LMM portfolio. MSCC and its consolidated subsidiaries invest primarily in secured debt investments, equity investments, warrants and other securities of LMM companies based in the United States and in secured debt investments of Middle Market companies generally headquartered in the United States.

        MSCC was formed in March 2007 to operate as an internally managed business development company ("BDC") under the Investment Company Act of 1940, as amended (the "1940 Act"). MSCC wholly owns several investment funds, including Main Street Mezzanine Fund, LP ("MSMF"), Main Street Capital II, LP ("MSC II") and Main Street Capital III, LP ("MSC III" and, collectively with MSMF and MSC II, the "Funds"), and each of their general partners. The Funds are each licensed as a Small Business Investment Company ("SBIC") by the United States Small Business Administration ("SBA"). Because MSCC is internally managed, all of the executive officers and other employees are employed by MSCC. Therefore, MSCC does not pay any external investment advisory fees, but instead directly incurs the operating costs associated with employing investment and portfolio management professionals.

        MSC Adviser I, LLC (the "External Investment Manager") was formed in November 2013 as a wholly owned subsidiary of MSCC to provide investment management and other services to parties other than MSCC and its subsidiaries or their portfolio companies ("External Parties") and receives fee income for such services. MSCC has been granted no-action relief by the Securities and Exchange Commission ("SEC") to allow the External Investment Manager to register as a registered investment adviser under the Investment Advisers Act of 1940, as amended. Since the External Investment Manager conducts all of its investment management activities for External Parties, it is accounted for as a portfolio investment of MSCC and is not included as a consolidated subsidiary of MSCC in MSCC's consolidated financial statements.

        MSCC has elected to be treated for U.S. federal income tax purposes as a regulated investment company ("RIC") under Subchapter M of the Internal Revenue Code of 1986, as amended (the "Code"). As a result, MSCC generally will not pay corporate-level U.S. federal income taxes on any net ordinary taxable income or capital gains that it distributes to its stockholders.

        MSCC has certain direct and indirect wholly owned subsidiaries that have elected to be taxable entities (the "Taxable Subsidiaries"). The primary purpose of the Taxable Subsidiaries is to permit MSCC to hold equity investments in portfolio companies which are "pass-through" entities for tax purposes.

        Unless otherwise noted or the context otherwise indicates, the terms "we," "us," "our," the "Company" and "Main Street" refer to MSCC and its consolidated subsidiaries, which include the Funds and the Taxable Subsidiaries.

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MAIN STREET CAPITAL CORPORATION

Notes to Consolidated Financial Statements (Continued)

(Unaudited)

2.     Basis of Presentation

        Main Street's consolidated financial statements are prepared in accordance with generally accepted accounting principles in the United States of America ("U.S. GAAP"). The Company is an investment company following accounting and reporting guidance in Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") 946, Financial Services—Investment Companies ("ASC 946"). For each of the periods presented herein, Main Street's consolidated financial statements include the accounts of MSCC and its consolidated subsidiaries. The Investment Portfolio, as used herein, refers to all of Main Street's investments in LMM portfolio companies, investments in Middle Market portfolio companies, Private Loan portfolio investments, Other Portfolio investments and the investment in the External Investment Manager (see "Note C—Fair Value Hierarchy for Investments and Debentures—Portfolio Composition—Investment Portfolio Composition" for additional discussion of Main Street's Investment Portfolio and definitions for the terms Private Loan and Other Portfolio). Main Street's results of operations and cash flows for the three months ended March 31, 2020 and 2019, and financial position as of March 31, 2020 and December 31, 2019, are presented on a consolidated basis. The effects of all intercompany transactions between Main Street and its consolidated subsidiaries have been eliminated in consolidation.

        The accompanying unaudited consolidated financial statements of Main Street are presented in conformity with U.S. GAAP for interim financial information and pursuant to the requirements for reporting on Form 10-Q and Articles 6, 10 and 12 of Regulation S-X. Accordingly, certain disclosures accompanying annual financial statements prepared in accordance with U.S. GAAP are omitted. In the opinion of management, the unaudited consolidated financial results included herein contain all adjustments, consisting solely of normal recurring accruals, considered necessary for the fair presentation of financial statements for the interim periods included herein. The results of operations for the three months ended March 31, 2020 and 2019 are not necessarily indicative of the operating results to be expected for the full year. Also, the unaudited financial statements and notes should be read in conjunction with the audited financial statements and notes thereto for the year ended December 31, 2019. Financial statements prepared on a U.S. GAAP basis require management to make estimates and assumptions that affect the amounts and disclosures reported in the financial statements and accompanying notes. Such estimates and assumptions could change in the future as more information becomes known, which could impact the amounts reported and disclosed herein.

        Under ASC 946, Main Street is precluded from consolidating other entities in which Main Street has equity investments, including those in which it has a controlling interest, unless the other entity is another investment company. An exception to this general principle in ASC 946 occurs if Main Street holds a controlling interest in an operating company that provides all or substantially all of its services directly to Main Street or to its portfolio companies. Accordingly, as noted above, MSCC's consolidated financial statements include the financial position and operating results for the Funds and the Taxable Subsidiaries. Main Street has determined that all of its portfolio investments do not qualify for this exception, including the investment in the External Investment Manager. Therefore, Main Street's Investment Portfolio is carried on the consolidated balance sheet at fair value, as discussed further in Note B.1., with any adjustments to fair value recognized as "Net Unrealized Appreciation (Depreciation)" on the consolidated statements of operations until the investment is realized, usually upon exit, resulting in any gain or loss being recognized as a "Net Realized Gain (Loss)."

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MAIN STREET CAPITAL CORPORATION

Notes to Consolidated Financial Statements (Continued)

(Unaudited)

    Portfolio Investment Classification

        Main Street classifies its Investment Portfolio in accordance with the requirements of the 1940 Act. Under the 1940 Act, (a) "Control Investments" are defined as investments in which Main Street owns more than 25% of the voting securities or has rights to maintain greater than 50% of the board representation, (b) "Affiliate Investments" are defined as investments in which Main Street owns between 5% and 25% (inclusive) of the voting securities and does not have rights to maintain greater than 50% of the board representation, and (c) "Non-Control/Non-Affiliate Investments" are defined as investments that are neither Control Investments nor Affiliate Investments.

NOTE B—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

1.     Valuation of the Investment Portfolio

        Main Street accounts for its Investment Portfolio at fair value. As a result, Main Street follows the provisions of ASC 820, Fair Value Measurements and Disclosures ("ASC 820"). ASC 820 defines fair value, establishes a framework for measuring fair value, establishes a fair value hierarchy based on the quality of inputs used to measure fair value and enhances disclosure requirements for fair value measurements. ASC 820 requires Main Street to assume that the portfolio investment is to be sold in the principal market to independent market participants, which may be a hypothetical market. Market participants are defined as buyers and sellers in the principal market that are independent, knowledgeable and willing and able to transact.

        Main Street's portfolio strategy calls for it to invest primarily in illiquid debt and equity securities issued by privately held, LMM companies and more liquid debt securities issued by Middle Market companies that are generally larger in size than the LMM companies. Main Street categorizes some of its investments in LMM companies and Middle Market companies as Private Loan portfolio investments, which are primarily debt securities in privately held companies that have been originated through strategic relationships with other investment funds on a collaborative basis, and are often referred to in the debt markets as "club deals." Private Loan investments are typically similar in size, structure, terms and conditions to investments Main Street holds in its LMM portfolio and Middle Market portfolio. Main Street's portfolio also includes Other Portfolio investments which primarily consist of investments that are not consistent with the typical profiles for its LMM portfolio investments, Middle Market portfolio investments or Private Loan portfolio investments, including investments which may be managed by third parties. Main Street's portfolio investments may be subject to restrictions on resale.

        LMM investments and Other Portfolio investments generally have no established trading market while Middle Market securities generally have established markets that are not active. Private Loan investments may include investments which have no established trading market or have established markets that are not active. Main Street determines in good faith the fair value of its Investment Portfolio pursuant to a valuation policy in accordance with ASC 820 and a valuation process approved by its Board of Directors and in accordance with the 1940 Act. Main Street's valuation policies and processes are intended to provide a consistent basis for determining the fair value of Main Street's Investment Portfolio.

        For LMM portfolio investments, Main Street generally reviews external events, including private mergers, sales and acquisitions involving comparable companies, and includes these events in the valuation process by using an enterprise value waterfall methodology ("Waterfall") for its LMM equity

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investments and an income approach using a yield-to-maturity model ("Yield-to-Maturity") for its LMM debt investments. For Middle Market portfolio investments, Main Street primarily uses quoted prices in the valuation process. Main Street determines the appropriateness of the use of third-party broker quotes, if any, in determining fair value based on its understanding of the level of actual transactions used by the broker to develop the quote and whether the quote was an indicative price or binding offer, the depth and consistency of broker quotes and the correlation of changes in broker quotes with underlying performance of the portfolio company and other market indices. For Middle Market and Private Loan portfolio investments in debt securities for which it has determined that third-party quotes or other independent pricing are not available or appropriate, Main Street generally estimates the fair value based on the assumptions that it believes hypothetical market participants would use to value the investment in a current hypothetical sale using the Yield-to-Maturity valuation method. For its Other Portfolio equity investments, Main Street generally calculates the fair value of the investment primarily based on the net asset value ("NAV") of the fund and adjusts the fair value for other factors deemed relevant that would affect the fair value of the investment. All of the valuation approaches for Main Street's portfolio investments estimate the value of the investment as if Main Street were to sell, or exit, the investment as of the measurement date.

        These valuation approaches consider the value associated with Main Street's ability to control the capital structure of the portfolio company, as well as the timing of a potential exit. For valuation purposes, "control" portfolio investments are composed of debt and equity securities in companies for which Main Street has a controlling interest in the equity ownership of the portfolio company or the ability to nominate a majority of the portfolio company's board of directors. For valuation purposes, "non-control" portfolio investments are generally composed of debt and equity securities in companies for which Main Street does not have a controlling interest in the equity ownership of the portfolio company or the ability to nominate a majority of the portfolio company's board of directors.

        Under the Waterfall valuation method, Main Street estimates the enterprise value of a portfolio company using a combination of market and income approaches or other appropriate valuation methods, such as considering recent transactions in the equity securities of the portfolio company or third-party valuations of the portfolio company, and then performs a waterfall calculation by allocating the enterprise value over the portfolio company's securities in order of their preference relative to one another. The enterprise value is the fair value at which an enterprise could be sold in a transaction between two willing parties, other than through a forced or liquidation sale. Typically, privately held companies are bought and sold based on multiples of earnings before interest, taxes, depreciation and amortization ("EBITDA"), cash flows, net income, revenues, or in limited cases, book value. There is no single methodology for estimating enterprise value. For any one portfolio company, enterprise value is generally described as a range of values from which a single estimate of enterprise value is derived. In estimating the enterprise value of a portfolio company, Main Street analyzes various factors including the portfolio company's historical and projected financial results. Due to SEC deadlines for Main Street's quarterly and annual financial reporting, the operating results of a portfolio company used in the current period valuation are generally the results from the period ended three months prior to such valuation date and may include unaudited, projected, budgeted or pro forma financial information and may require adjustments for non-recurring items or to normalize the operating results that may require significant judgment in determining. In addition, projecting future financial results requires significant judgment regarding future growth assumptions. In evaluating the operating results, Main Street also analyzes the impact of exposure to litigation, loss of customers or other contingencies. After determining the appropriate enterprise value, Main Street allocates the enterprise value to

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investments in order of the legal priority of the various components of the portfolio company's capital structure. In applying the Waterfall valuation method, Main Street assumes the loans are paid off at the principal amount in a change in control transaction and are not assumed by the buyer, which Main Street believes is consistent with its past transaction history and standard industry practices.

        Under the Yield-to-Maturity valuation method, Main Street also uses the income approach to determine the fair value of debt securities based on projections of the discounted future free cash flows that the debt security will likely generate, including analyzing the discounted cash flows of interest and principal amounts for the debt security, as set forth in the associated loan agreements, as well as the financial position and credit risk of the portfolio company. Main Street's estimate of the expected repayment date of its debt securities is generally the maturity date of the instrument, as Main Street generally intends to hold its loans and debt securities to maturity. The Yield-to-Maturity analysis also considers changes in leverage levels, credit quality, portfolio company performance and other factors. Main Street will generally use the value determined by the Yield-to-Maturity analysis as the fair value for that security; however, because of Main Street's general intent to hold its loans to maturity, the fair value will not exceed the principal amount of the debt security valued using the Yield-to-Maturity valuation method. A change in the assumptions that Main Street uses to estimate the fair value of its debt securities using the Yield-to-Maturity valuation method could have a material impact on the determination of fair value. If there is deterioration in credit quality or if a debt security is in workout status, Main Street may consider other factors in determining the fair value of the debt security, including the value attributable to the debt security from the enterprise value of the portfolio company or the proceeds that would most likely be received in a liquidation analysis.

        Under the NAV valuation method, for an investment in an investment fund that does not have a readily determinable fair value, Main Street measures the fair value of the investment predominately based on the NAV of the investment fund as of the measurement date and adjusts the investment's fair value for factors known to Main Street that would affect that fund's NAV, including, but not limited to, fair values for individual investments held by the fund if Main Street holds the same investment or for a publicly traded investment. In addition, in determining the fair value of the investment, Main Street considers whether adjustments to the NAV are necessary in certain circumstances, based on the analysis of any restrictions on redemption of Main Street's investment as of the measurement date, recent actual sales or redemptions of interests in the investment fund, and expected future cash flows available to equity holders, including the rate of return on those cash flows compared to an implied market return on equity required by market participants, or other uncertainties surrounding Main Street's ability to realize the full NAV of its interests in the investment fund.

        Pursuant to its internal valuation process and the requirements under the 1940 Act, Main Street performs valuation procedures on each of its portfolio investments quarterly. In addition to its internal valuation process, in arriving at estimates of fair value for its investments in its LMM portfolio companies, Main Street, among other things, consults with a nationally recognized independent financial advisory services firm. The nationally recognized independent financial advisory services firm analyzes and provides observations, recommendations and an assurance certification regarding the Company's determinations of the fair value of its LMM portfolio company investments. The nationally recognized independent financial advisory services firm is generally consulted relative to Main Street's investments in each LMM portfolio company at least once every calendar year, and for Main Street's investments in new LMM portfolio companies, at least once in the twelve-month period subsequent to the initial investment. In certain instances, Main Street may determine that it is not cost-effective, and as a result is not in its stockholders' best interest, to consult with the nationally recognized independent

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financial advisory services firm on its investments in one or more LMM portfolio companies. Such instances include, but are not limited to, situations where the fair value of Main Street's investment in a LMM portfolio company is determined to be insignificant relative to the total Investment Portfolio. Main Street consulted with and received an assurance certification from its independent financial advisory services firm in arriving at Main Street's determination of fair value on its investments in a total of 15 LMM portfolio companies for the three months ended March 31, 2020, representing approximately 26% of the total LMM portfolio at fair value as of March 31, 2020, and on a total of 15 LMM portfolio companies for the three months ended March 31, 2019, representing approximately 24% of the total LMM portfolio at fair value as of March 31, 2019. Excluding its investments in LMM portfolio companies that, as of March 31, 2020 and 2019, as applicable, had not been in the Investment Portfolio for at least twelve months subsequent to the initial investment or whose primary purpose is to own real estate for which a third-party appraisal is obtained on at least an annual basis, the percentage of the LMM portfolio reviewed and certified by its independent financial advisory services firm for the three months ended March 31, 2020 and 2019 was 29% and 26% of the total LMM portfolio at fair value as of March 31, 2020 and 2019, respectively.

        For valuation purposes, all of Main Street's Middle Market portfolio investments are non-control investments. To the extent sufficient observable inputs are available to determine fair value, Main Street uses observable inputs to determine the fair value of these investments through obtaining third-party quotes or other independent pricing. For Middle Market portfolio investments for which it has determined that third-party quotes or other independent pricing are not available or appropriate, Main Street generally estimates the fair value based on the assumptions that it believes hypothetical market participants would use to value such Middle Market debt investments in a current hypothetical sale using the Yield-to-Maturity valuation method and such Middle Market equity investments in a current hypothetical sale using the Waterfall valuation method. Because the vast majority of the Middle Market portfolio investments are typically valued using third-party quotes or other independent pricing services (including 92% and 91% of the Middle Market portfolio investments as of March 31, 2020 and December 31, 2019, respectively), Main Street generally does not consult with any financial advisory services firms in connection with determining the fair value of its Middle Market investments.

        For valuation purposes, all of Main Street's Private Loan portfolio investments are non-control investments. For Private Loan portfolio investments for which it has determined that third-party quotes or other independent pricing are not available or appropriate, Main Street generally estimates the fair value based on the assumptions that it believes hypothetical market participants would use to value such Private Loan debt investments in a current hypothetical sale using the Yield-to-Maturity valuation method and such Private Loan equity investments in a current hypothetical sale using the Waterfall valuation method.

        In addition to its internal valuation process, in arriving at estimates of fair value for its investments in its Private Loan portfolio companies, Main Street, among other things, consults with a nationally recognized independent financial advisory services firm. The nationally recognized independent financial advisory services firm analyzes and provides observations and recommendations and an assurance certification regarding the Company's determinations of the fair value of its Private Loan portfolio company investments. The nationally recognized independent financial advisory services firm is generally consulted relative to Main Street's investments in each Private Loan portfolio company at least once every calendar year, and for Main Street's investments in new Private Loan portfolio companies, at least once in the twelve-month period subsequent to the initial investment. In certain instances, Main Street may determine that it is not cost-effective, and as a result is not in its

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stockholders' best interest, to consult with the nationally recognized independent financial advisory services firm on its investments in one or more Private Loan portfolio companies. Such instances include, but are not limited to, situations where the fair value of Main Street's investment in a Private Loan portfolio company is determined to be insignificant relative to the total Investment Portfolio. Main Street consulted with and received an assurance certification from its independent financial advisory services firm in arriving at its determination of fair value on its investments in a total of ten Private Loan portfolio companies for the three months ended March 31, 2020, representing approximately 17% of the total Private Loan portfolio at fair value as of March 31, 2020, and on a total of seven Private Loan portfolio companies for the three months ended March 31, 2019, representing approximately 13% of the total Private Loan portfolio at fair value as of March 31, 2019. Excluding its investments in Private Loan portfolio companies that, as of March 31, 2020 and 2019, as applicable, had not been in the Investment Portfolio for at least twelve months subsequent to the initial investment and its investments in Private Loan portfolio companies that were not reviewed because the investment is valued based upon third-party quotes or other independent pricing, the percentage of the Private Loan portfolio reviewed and certified by its independent financial advisory services firm for the three months ended March 31, 2020 and 2019 was 25% and 20% of the total Private Loan portfolio at fair value as of March 31, 2020 and 2019, respectively.

        For valuation purposes, all of Main Street's Other Portfolio investments are non-control investments. Main Street's Other Portfolio investments comprised 4.0% and 4.1% of Main Street's Investment Portfolio at fair value as of March 31, 2020 and December 31, 2019, respectively. Similar to the LMM investment portfolio, market quotations for Other Portfolio equity investments are generally not readily available. For its Other Portfolio equity investments, Main Street generally determines the fair value of these investments using the NAV valuation method.

        For valuation purposes, Main Street's investment in the External Investment Manager is a control investment. Market quotations are not readily available for this investment, and as a result, Main Street determines the fair value of the External Investment Manager using the Waterfall valuation method under the market approach. In estimating the enterprise value, Main Street analyzes various factors, including the entity's historical and projected financial results, as well as its size, marketability and performance relative to the population of market comparables. This valuation approach estimates the value of the investment as if Main Street were to sell, or exit, the investment. In addition, Main Street considers its ability to control the capital structure of the company, as well as the timing of a potential exit, in connection with determining the fair value of the External Investment Manager.

        Due to the inherent uncertainty in the valuation process, Main Street's determination of fair value for its Investment Portfolio may differ materially from the values that would have been determined had a ready market for the securities existed. In addition, changes in the market environment, portfolio company performance and other events that may occur over the lives of the investments may cause the gains or losses ultimately realized on these investments to be materially different than the valuations currently assigned. Main Street determines the fair value of each individual investment and records changes in fair value as unrealized appreciation or depreciation.

        Main Street uses an internally developed portfolio investment rating system in connection with its investment oversight, portfolio management and analysis and investment valuation procedures for its LMM portfolio companies. This system takes into account both quantitative and qualitative factors of the LMM portfolio company and the investments held therein.

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        The Board of Directors of Main Street has the final responsibility for overseeing, reviewing and approving, in good faith, Main Street's determination of the fair value for its Investment Portfolio, as well as its valuation procedures, consistent with 1940 Act requirements. Main Street believes its Investment Portfolio as of March 31, 2020 and December 31, 2019 approximates fair value as of those dates based on the markets in which Main Street operates and other conditions in existence on those reporting dates.

2.     Use of Estimates

        The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the period. Actual results may differ from these estimates under different conditions or assumptions. Additionally, as explained in Note B.1., the consolidated financial statements include investments in the Investment Portfolio whose values have been estimated by Main Street with the oversight, review and approval by Main Street's Board of Directors in the absence of readily ascertainable market values. Because of the inherent uncertainty of the Investment Portfolio valuations, those estimated values may differ materially from the values that would have been determined had a ready market for the securities existed.

3.     Cash and Cash Equivalents

        Cash and cash equivalents consist of cash and highly liquid investments with an original maturity of three months or less at the date of purchase. Cash and cash equivalents are carried at cost, which approximates fair value.

        At March 31, 2020, cash balances totaling $49.8 million exceeded Federal Deposit Insurance Corporation insurance protection levels, subjecting the Company to risk related to the uninsured balance. All of the Company's cash deposits are held at large established high credit quality financial institutions and management believes that the risk of loss associated with any uninsured balances is remote.

4.     Interest, Dividend and Fee Income

        Main Street records interest and dividend income on the accrual basis to the extent amounts are expected to be collected. Dividend income is recorded as dividends are declared by the portfolio company or at the point an obligation exists for the portfolio company to make a distribution. In accordance with Main Street's valuation policies, Main Street evaluates accrued interest and dividend income periodically for collectability. When a loan or debt security becomes 90 days or more past due, and if Main Street otherwise does not expect the debtor to be able to service all of its debt or other obligations, Main Street will generally place the loan or debt security on non-accrual status and cease recognizing interest income on that loan or debt security until the borrower has demonstrated the ability and intent to pay contractual amounts due. If a loan or debt security's status significantly improves regarding the debtor's ability to service the debt or other obligations, or if a loan or debt security is sold or written off, Main Street removes it from non-accrual status.

        As of March 31, 2020, Main Street's total Investment Portfolio had ten investments on non-accrual status, which comprised approximately 1.3% of its fair value and 5.3% of its cost. As of December 31,

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2019, Main Street's total Investment Portfolio had eight investments on non-accrual status, which comprised approximately 1.4% of its fair value and 4.8% of its cost.

        Main Street holds certain debt and preferred equity instruments in its Investment Portfolio that contain payment-in-kind ("PIK") interest and cumulative dividend provisions. The PIK interest, computed at the contractual rate specified in each debt agreement, is periodically added to the principal balance of the debt and is recorded as interest income. Thus, the actual collection of this interest may be deferred until the time of debt principal repayment. Cumulative dividends are recorded as dividend income, and any dividends in arrears are added to the balance of the preferred equity investment. The actual collection of these dividends in arrears may be deferred until such time as the preferred equity is redeemed or sold. To maintain RIC tax treatment (as discussed in Note B.9. below), these non-cash sources of income may need to be paid out to stockholders in the form of distributions, even though Main Street may not have collected the PIK interest and cumulative dividends in cash. Main Street stops accruing PIK interest and cumulative dividends and writes off any accrued and uncollected interest and dividends in arrears when it determines that such PIK interest and dividends in arrears are no longer collectible. For the three months ended March 31, 2020 and 2019, (i) approximately 1.1% and 1.9%, respectively, of Main Street's total investment income was attributable to PIK interest income not paid currently in cash and (ii) approximately 1.0% and 1.1%, respectively, of Main Street's total investment income was attributable to cumulative dividend income not paid currently in cash.

        Main Street may periodically provide services, including structuring and advisory services, to its portfolio companies or other third parties. For services that are separately identifiable and evidence exists to substantiate fair value, fee income is recognized as earned, which is generally when the investment or other applicable transaction closes. Fees received in connection with debt financing transactions for services that do not meet these criteria are treated as debt origination fees and are deferred and accreted into income over the life of the financing.

        A presentation of total investment income Main Street received from its Investment Portfolio in each of the periods presented is as follows:

 
   Three Months Ended March 31,  
 
   2020   2019  
 
   (dollars in thousands)
  

Interest, fee and dividend income:

              

Interest income

   $ 44,877   $ 47,320  

Dividend income

     8,041     12,496  

Fee income

     3,232     1,549  
​ ​ ​ ​ ​ ​ ​ ​

Total interest, fee and dividend income

   $ 56,150   $ 61,365  
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​

5.     Deferred Financing Costs

        Deferred financing costs include commitment fees and other costs related to Main Street's multi-year revolving credit facility (the "Credit Facility") and its unsecured notes, as well as the commitment fees and leverage fees (approximately 3.4% of the total commitment and draw amounts, as applicable) on the SBIC debentures which are not accounted for under the fair value option under

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ASC 825 (as discussed further in Note B.11.). See further discussion of Main Street's debt in Note E. Deferred financing costs in connection with the Credit Facility are capitalized as an asset. Deferred financing costs in connection with all other debt arrangements not using the fair value option are a direct deduction from the related debt liability.

6.     Equity Offering Costs

        The Company's offering costs are charged against the proceeds from equity offerings when the proceeds are received.

7.     Unearned Income—Debt Origination Fees and Original Issue Discount and Discounts / Premiums to Par Value

        Main Street capitalizes debt origination fees received in connection with financings and reflects such fees as unearned income netted against the applicable debt investments. The unearned income from the fees is accreted into income based on the effective interest method over the life of the financing.

        In connection with its portfolio debt investments, Main Street sometimes receives nominal cost warrants or warrants with an exercise price below the fair value of the underlying equity (together, "nominal cost equity") that are valued as part of the negotiation process with the particular portfolio company. When Main Street receives nominal cost equity, Main Street allocates its cost basis in its investment between its debt security and its nominal cost equity at the time of origination based on amounts negotiated with the particular portfolio company. The allocated amounts are based upon the fair value of the nominal cost equity, which is then used to determine the allocation of cost to the debt security. Any discount recorded on a debt investment resulting from this allocation is reflected as unearned income, which is netted against the applicable debt investment, and accreted into interest income based on the effective interest method over the life of the debt investment. The actual collection of this interest is deferred until the time of debt principal repayment.

        Main Street may also purchase debt securities at a discount or at a premium to the par value of the debt security. In the case of a purchase at a discount, Main Street records the investment at the par value of the debt security net of the discount, and the discount is accreted into interest income based on the effective interest method over the life of the debt investment. In the case of a purchase at a premium, Main Street records the investment at the par value of the debt security plus the premium, and the premium is amortized as a reduction to interest income based on the effective interest method over the life of the debt investment.

        To maintain RIC tax treatment (as discussed in Note B.9. below), these non-cash sources of income may need to be paid out to stockholders in the form of distributions, even though Main Street may not have collected the interest income. For the three months ended March 31, 2020 and 2019, approximately 2.6% and 2.8%, respectively, of Main Street's total investment income was attributable to interest income from the accretion of discounts associated with debt investments, net of any premium reduction.

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8.     Share-Based Compensation

        Main Street accounts for its share-based compensation plans using the fair value method, as prescribed by ASC 718, Compensation—Stock Compensation. Accordingly, for restricted stock awards, Main Street measures the grant date fair value based upon the market price of its common stock on the date of the grant and amortizes the fair value of the awards as share-based compensation expense over the requisite service period, which is generally the vesting term.

        Main Street has also adopted Accounting Standards Update ("ASU") 2016-09, Compensation—Stock Compensation: Improvements to Employee Share-Based Payment Accounting, which requires that all excess tax benefits and tax deficiencies (including tax benefits of dividends on share-based payment awards) be recognized as income tax expense or benefit in the income statement and not delay recognition of a tax benefit until the tax benefit is realized through a reduction to taxes payable. Accordingly, the tax effects of exercised or vested awards are treated as discrete items in the reporting period in which they occur. Additionally, Main Street has elected to account for forfeitures as they occur.

9.     Income Taxes

        MSCC has elected to be treated for U.S. federal income tax purposes as a RIC. MSCC's taxable income includes the taxable income generated by MSCC and certain of its subsidiaries, including the Funds, which are treated as disregarded entities for tax purposes. As a RIC, MSCC generally will not pay corporate-level U.S. federal income taxes on any net ordinary taxable income or capital gains that MSCC distributes to its stockholders. MSCC must generally distribute at least 90% of its "investment company taxable income" (which is generally its net ordinary taxable income and realized net short-term capital gains in excess of realized net long-term capital losses) and 90% of its tax-exempt income to maintain its RIC status (pass-through tax treatment for amounts distributed). As part of maintaining RIC status, undistributed taxable income (subject to a 4% non-deductible U.S. federal excise tax) pertaining to a given fiscal year may be distributed up to 12 months subsequent to the end of that fiscal year, provided such dividends are declared on or prior to the later of (i) the filing of the U.S. federal income tax return for the applicable fiscal year or (ii) the fifteenth day of the ninth month following the close of the year in which such taxable income was generated.

        The Taxable Subsidiaries primarily hold certain portfolio investments for Main Street. The Taxable Subsidiaries permit Main Street to hold equity investments in portfolio companies which are "pass-through" entities for tax purposes and to continue to comply with the "source-of-income" requirements contained in the RIC tax provisions of the Code. The Taxable Subsidiaries are consolidated with Main Street for U.S. GAAP financial reporting purposes, and the portfolio investments held by the Taxable Subsidiaries are included in Main Street's consolidated financial statements as portfolio investments and recorded at fair value. The Taxable Subsidiaries are not consolidated with MSCC for income tax purposes and may generate income tax expense, or benefit, and tax assets and liabilities, as a result of their ownership of certain portfolio investments. The taxable income, or loss, of the Taxable Subsidiaries may differ from their book income, or loss, due to temporary book and tax timing differences and permanent differences. The Taxable Subsidiaries are each taxed at their normal corporate tax rates based on their taxable income. The income tax expense, or benefit, if any, and the related tax assets and liabilities, of the Taxable Subsidiaries are reflected in Main Street's consolidated financial statements.

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        The External Investment Manager is an indirect wholly owned subsidiary of MSCC owned through a Taxable Subsidiary and is a disregarded entity for tax purposes. The External Investment Manager has entered into a tax sharing agreement with its Taxable Subsidiary owner. Since the External Investment Manager is accounted for as a portfolio investment of MSCC and is not included as a consolidated subsidiary of MSCC in MSCC's consolidated financial statements, and as a result of the tax sharing agreement with its Taxable Subsidiary owner, for its stand-alone financial reporting purposes the External Investment Manager is treated as if it is taxed at normal corporate tax rates based on its taxable income and, as a result of its activities, may generate income tax expense or benefit. The income tax expense, or benefit, if any, and the related tax assets and liabilities, of the External Investment Manager are reflected in the External Investment Manager's separate financial statements.

        The Taxable Subsidiaries and the External Investment Manager use the liability method in accounting for income taxes. Deferred tax assets and liabilities are recorded for temporary differences between the tax basis of assets and liabilities and their reported amounts in the consolidated financial statements, using statutory tax rates in effect for the year in which the temporary differences are expected to reverse. A valuation allowance is provided, if necessary, against deferred tax assets when it is more likely than not that some portion or all of the deferred tax asset will not be realized.

        Taxable income generally differs from net income for financial reporting purposes due to temporary and permanent differences in the recognition of income and expenses. Taxable income generally excludes net unrealized appreciation or depreciation, as investment gains or losses are not included in taxable income until they are realized.

10.   Net Realized Gains or Losses and Net Unrealized Appreciation or Depreciation

        Realized gains or losses are measured by the difference between the net proceeds from the sale or redemption of an investment or a financial instrument and the cost basis of the investment or financial instrument, without regard to unrealized appreciation or depreciation previously recognized, and includes investments written-off during the period net of recoveries and realized gains or losses from in-kind redemptions. Net unrealized appreciation or depreciation reflects the net change in the fair value of the Investment Portfolio and financial instruments and the reclassification of any prior period unrealized appreciation or depreciation on exited investments and financial instruments to realized gains or losses.

11.   Fair Value of Financial Instruments

        Fair value estimates are made at discrete points in time based on relevant information. These estimates may be subjective in nature and involve uncertainties and matters of significant judgment and, therefore, cannot be determined with precision. Main Street believes that the carrying amounts of its financial instruments, consisting of cash and cash equivalents, receivables, payables and other liabilities approximate the fair values of such items due to the short-term nature of these instruments.

        As part of Main Street's acquisition of the majority of the equity interests of MSC II in January 2010 (the "MSC II Acquisition"), Main Street elected the fair value option under ASC 825, Financial Instruments ("ASC 825"), relating to accounting for debt obligations at their fair value, for the MSC II SBIC debentures acquired as part of the acquisition accounting related to the MSC II Acquisition and valued those obligations as discussed further in Note C. In order to provide for a more consistent basis of presentation, Main Street elected the fair value option for SBIC debentures issued by MSC II subsequent to the MSC II Acquisition. When the fair value option is elected for a given SBIC

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debenture, the deferred loan costs associated with the debenture are fully expensed in the current period to "Net Unrealized Appreciation (Depreciation)—SBIC debentures" as part of the fair value adjustment. Interest incurred in connection with SBIC debentures which are valued at fair value is included in interest expense.

12.   Earnings per Share

        Basic and diluted per share calculations are computed utilizing the weighted-average number of shares of common stock outstanding for the period. In accordance with ASC 260, Earnings Per Share, the unvested shares of restricted stock awarded pursuant to Main Street's equity compensation plans are participating securities and, therefore, are included in the basic earnings per share calculation. As a result, for all periods presented, there is no difference between diluted earnings per share and basic earnings per share amounts.

13.   Recently Issued or Adopted Accounting Standards

        In August 2018, the SEC adopted rules (the "SEC Release") amending certain disclosure requirements intended to eliminate redundant, duplicative, overlapping, outdated, or superseded, in light of other SEC disclosure requirements, U.S. GAAP requirements or changes in the information environment. In part, the SEC Release requires an investment company to present distributable earnings in total on the consolidated balance sheet and consolidated statement of changes in net assets, rather than showing the three components of distributable earnings as previously shown. Main Street adopted this part of the SEC Release during the year ended December 31, 2018. The impact of the adoption of these rules on Main Street's consolidated financial statements was not material. Additionally, the SEC Release requires disclosure of changes in net assets within a registrant's Form 10-Q filings on a quarter-to-date and year-to-date basis for both the current year and prior year comparative periods. Main Street adopted the requirement to present changes in net assets in interim financial statements within Form 10-Q filings effective January 1, 2019. The adoption of these rules did not have a material impact on the consolidated financial statements.

        In March 2020, the FASB issued ASU 2020-04, "Reference rate reform (Topic 848)—Facilitation of the effects of reference rate reform on financial reporting." The amendments in this update provide optional expedients and exceptions for applying U.S. GAAP to certain contracts and hedging relationships that reference LIBOR or another reference rate expected to be discontinued due to reference rate reform and became effective upon issuance for all entities. The Company has agreements that have LIBOR as a reference rate with certain portfolio companies and also with certain lenders. Many of these agreements include language for choosing an alternative successor rate if LIBOR reference is no longer considered to be appropriate. Contract modifications are required to be evaluated in determining whether the modifications result in the establishment of new contracts or the continuation of existing contracts. The Company adopted this amendment in March 2020 and plans to apply the amendments in this update to account for contract modifications due to changes in reference rates. The Company does not believe that it will have a material impact on its consolidated financial statements and disclosures.

        From time to time, new accounting pronouncements are issued by the FASB or other standards setting bodies that are adopted by Main Street as of the specified effective date. Main Street believes that the impact of recently issued standards and any that are not yet effective will not have a material impact on its consolidated financial statements upon adoption.

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NOTE C—FAIR VALUE HIERARCHY FOR INVESTMENTS AND DEBENTURES—PORTFOLIO COMPOSITION

        ASC 820 defines fair value, establishes a framework for measuring fair value, establishes a fair value hierarchy based on the quality of inputs used to measure fair value, and enhances disclosure requirements for fair value measurements. Main Street accounts for its investments at fair value.

    Fair Value Hierarchy

        In accordance with ASC 820, Main Street has categorized its investments based on the priority of the inputs to the valuation technique into a three-level fair value hierarchy. The fair value hierarchy gives the highest priority to quoted prices in active markets for identical investments (Level 1) and the lowest priority to unobservable inputs (Level 3).

        Investments recorded on Main Street's balance sheet are categorized based on the inputs to the valuation techniques as follows:

            Level 1—Investments whose values are based on unadjusted quoted prices for identical assets in an active market that Main Street has the ability to access (examples include investments in active exchange-traded equity securities and investments in most U.S. government and agency securities).

            Level 2—Investments whose values are based on quoted prices in markets that are not active or model inputs that are observable either directly or indirectly for substantially the full term of the investment. Level 2 inputs include the following:

      •
      Quoted prices for similar assets in active markets (for example, investments in restricted stock);

      •
      Quoted prices for identical or similar assets in non-active markets (for example, investments in thinly traded public companies);

      •
      Pricing models whose inputs are observable for substantially the full term of the investment (for example, market interest rate indices); and

      •
      Pricing models whose inputs are derived principally from, or corroborated by, observable market data through correlation or other means for substantially the full term of the investment.

            Level 3—Investments whose values are based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement (for example, investments in illiquid securities issued by privately held companies). These inputs reflect management's own assumptions about the assumptions a market participant would use in pricing the investment.

        As required by ASC 820, when the inputs used to measure fair value fall within different levels of the hierarchy, the level within which the fair value measurement is categorized is based on the lowest level input that is significant to the fair value measurement in its entirety. For example, a Level 3 fair value measurement may include inputs that are observable (Levels 1 and 2) and unobservable (Level 3). Therefore, unrealized appreciation and depreciation related to such investments categorized within the Level 3 tables below may include changes in fair value that are attributable to both observable inputs (Levels 1 and 2) and unobservable inputs (Level 3).

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(Unaudited)

        As of March 31, 2020 and December 31, 2019, all of Main Street's LMM portfolio investments consisted of illiquid securities issued by privately held companies. As a result, the fair value determination for all of Main Street's LMM portfolio investments primarily consisted of unobservable inputs. As a result, all of Main Street's LMM portfolio investments were categorized as Level 3 as of March 31, 2020 and December 31, 2019.

        As of March 31, 2020 and December 31, 2019, Main Street's Middle Market portfolio investments consisted primarily of investments in secured and unsecured debt investments and independently rated debt investments. The fair value determination for these investments consisted of a combination of observable inputs in non-active markets for which sufficient observable inputs were not available to determine the fair value of these investments and unobservable inputs. As a result, all of Main Street's Middle Market portfolio investments were categorized as Level 3 as of March 31, 2020 and December 31, 2019.

        As of March 31, 2020 and December 31, 2019, Main Street's Private Loan portfolio investments primarily consisted of investments in interest-bearing secured debt investments. The fair value determination for these investments consisted of a combination of observable inputs in non-active markets for which sufficient observable inputs were not available to determine the fair value of these investments and unobservable inputs. As a result, all of Main Street's Private Loan portfolio investments were categorized as Level 3 as of March 31, 2020 and December 31, 2019.

        As of March 31, 2020 and December 31, 2019, Main Street's Other Portfolio investments consisted of illiquid securities issued by privately held companies. The fair value determination for these investments primarily consisted of unobservable inputs. As a result, all of Main Street's Other Portfolio investments were categorized as Level 3 as of March 31, 2020 and December 31, 2019.

        The fair value determination of each portfolio investment categorized as Level 3 required one or more of the following unobservable inputs:

    •
    Financial information obtained from each portfolio company, including unaudited statements of operations and balance sheets for the most recent period available as compared to budgeted numbers;

    •
    Current and projected financial condition of the portfolio company;

    •
    Current and projected ability of the portfolio company to service its debt obligations;

    •
    Type and amount of collateral, if any, underlying the investment;

    •
    Current financial ratios (e.g., fixed charge coverage ratio, interest coverage ratio and net debt/EBITDA ratio) applicable to the investment;

    •
    Current liquidity of the investment and related financial ratios (e.g., current ratio and quick ratio);

    •
    Pending debt or capital restructuring of the portfolio company;

    •
    Projected operating results of the portfolio company;

    •
    Current information regarding any offers to purchase the investment;

    •
    Current ability of the portfolio company to raise any additional financing as needed;

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(Unaudited)

    •
    Changes in the economic environment which may have a material impact on the operating results of the portfolio company;

    •
    Internal occurrences that may have an impact (both positive and negative) on the operating performance of the portfolio company;

    •
    Qualitative assessment of key management;

    •
    Contractual rights, obligations or restrictions associated with the investment; and

    •
    Other factors deemed relevant.

        The use of significant unobservable inputs creates uncertainty in the measurement of fair value as of the reporting date. The significant unobservable inputs used in the fair value measurement of Main Street's LMM equity securities, which are generally valued through an average of the discounted cash flow technique and the market comparable/enterprise value technique (unless one of these approaches is determined to not be appropriate), are (i) EBITDA multiples and (ii) the weighted-average cost of capital ("WACC"). Significant increases (decreases) in EBITDA multiple inputs in isolation would result in a significantly higher (lower) fair value measurement. On the contrary, significant increases (decreases) in WACC inputs in isolation would result in a significantly lower (higher) fair value measurement. The significant unobservable inputs used in the fair value measurement of Main Street's LMM, Middle Market and Private Loan securities are (i) risk adjusted discount rates used in the Yield-to-Maturity valuation technique (see "Note B.1.—Valuation of the Investment Portfolio") and (ii) the percentage of expected principal recovery. Significant increases (decreases) in any of these discount rates in isolation would result in a significantly lower (higher) fair value measurement. Significant increases (decreases) in any of these expected principal recovery percentages in isolation would result in a significantly higher (lower) fair value measurement. However, due to the nature of certain investments, fair value measurements may be based on other criteria, such as third-party appraisals of collateral and fair values as determined by independent third parties, which are not presented in the tables below.

        The following tables provide a summary of the significant unobservable inputs used to fair value Main Street's Level 3 portfolio investments as of March 31, 2020 and December 31, 2019:

Type of Investment
  Fair Value
as of
March 31, 2020
(in thousands) 		  Valuation Technique   Significant Unobservable Inputs   Range(3)   Weighted
Average(3) 		  Median(3)  

Equity investments

   $ 770,111   Discounted cash flow   WACC   9.5% - 20.9%     14.2%     14.6%  

        Market comparable /   EBITDA multiple(1)   4.7x - 8.5x(2)     7.1x     6.4x  

        Enterprise Value                      

Debt investments

   $ 1,145,965   Discounted cash flow   Risk adjusted discount factor   8.0% - 17.9%(2)     12.4%     11.9%  

            Expected principal recovery   0.0% - 100.0%     99.3%     100.0%  

            percentage                  

Debt investments

   $ 456,670   Market approach   Third-party quote   18.1 - 99.5     84.4     86.5  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Total Level 3 investments

   $ 2,372,746                          
(1)
EBITDA may include proforma adjustments and/or other addbacks based on specific circumstances related to each investment.

(2)
Range excludes outliers that are greater than one standard deviation from the mean. Including these outliers, the range for EBITDA multiple is 4.0x - 15.0x and the range for risk adjusted discount factor is 5.3% - 40.5%.

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(Unaudited)

(3)
Does not include investments for which the valuation technique does not include the use of the applicable fair value input.
Type of Investment
  Fair Value
as of
December 31, 2019
(in thousands) 		  Valuation Technique   Significant Unobservable Inputs   Range(3)   Weighted
Average(3) 		  Median(3)  

Equity investments

   $ 819,749   Discounted cash flow   WACC   9.6% - 20.3%     13.6%     14.2%  

        Market comparable /   EBITDA multiple(1)   4.9x - 8.5x(2)     7.2x     6.4x  

        Enterprise Value                      

Debt investments

   $ 1,212,741   Discounted cash flow   Risk adjusted discount factor   5.9% - 16.5%(2)     10.4%     10.0%  

            Expected principal recovery   1.4% - 100.0%     99.3%     100.0%  

            percentage                  

Debt investments

   $ 569,834   Market approach   Third-party quote   28.1 - 101.0     94.7     98.0  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Total Level 3 investments

   $ 2,602,324                          
(1)
EBITDA may include proforma adjustments and/or other addbacks based on specific circumstances related to each investment.

(2)
Range excludes outliers that are greater than one standard deviation from the mean. Including these outliers, the range for EBITDA multiple is 4.5x - 15.0x and the range for risk adjusted discount factor is 4.6% - 38.0%.

(3)
Does not include investments for which the valuation technique does not include the use of the applicable fair value input.

        The following tables provide a summary of changes in fair value of Main Street's Level 3 portfolio investments for the three-month periods ended March 31, 2020 and 2019 (amounts in thousands):

Type of Investment
  Fair Value
as of
December 31,
2019 		  Transfers
Into Level 3
Hierarchy 		  Redemptions/
Repayments 		  New
Investments 		  Net Changes
from
Unrealized
to Realized 		  Net
Unrealized
Appreciation
(Depreciation) 		  Other(1)   Fair Value
as of
March 31,
2020 		 

Debt

   $ 1,782,575   $ —   $ (176,860 ) $ 121,481   $ 16,539   $ (141,100 ) $ —   $ 1,602,635  

Equity

   $ 809,538   $ —   $ (6,469 ) $ 22,492   $ 3,177   $ (68,972 ) $ —   $ 759,766  

Equity Warrant

   $ 10,211   $ —   $ (1,096 ) $ —   $ 1,096   $ 134   $ —   $ 10,345  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

  $ 2,602,324   $ —   $ (184,425 ) $ 143,973   $ 20,812   $ (209,938 ) $ —   $ 2,372,746  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
(1)
Includes the impact of non-cash conversions. These transactions represent non-cash investing activities. See additional cash flow information at the consolidated statements of cash flows.
Type of Investment
  Fair Value
as of
December 31,
2018 		  Transfers
Into Level 3
Hierarchy 		  Redemptions/
Repayments 		  New
Investments 		  Net Changes
from
Unrealized
to Realized 		  Net
Unrealized
Appreciation
(Depreciation) 		  Other(1)   Fair Value
as of
March 31,
2019 		 

Debt

   $ 1,686,753   $ —   $ (68,769 ) $ 91,529   $ 7,387   $ 2,614   $ (3,044 ) $ 1,716,470  

Equity

     755,710     —     (7,441 )   13,094     (4,100 )   8,478     3,044     768,785  

Equity Warrant

     11,446     —     —     —     —     (110 )   —     11,336  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

  $ 2,453,909   $ —   $ (76,210 ) $ 104,623   $ 3,287   $ 10,982   $ —   $ 2,496,591  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
(1)
Includes the impact of non-cash conversions. These transactions represent non-cash investing activities. See additional cash flow information at the consolidated statements of cash flows.

        As of December 31, 2019, the fair value determination for the SBIC debentures recorded at fair value primarily consisted of unobservable inputs. As a result, the SBIC debentures which were recorded at fair value were categorized as Level 3. Main Street determined the fair value of these instruments primarily using a Yield-to-Maturity approach that analyzed the discounted cash flows of interest and principal for each SBIC debenture recorded at fair value based on estimated market interest rates for debt instruments of similar structure, terms, and maturity. Main Street's estimate of the expected repayment date of principal for each SBIC debenture recorded at fair value was the legal maturity date of the instrument. The significant unobservable inputs used in the fair value measurement of Main

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(Unaudited)

Street's SBIC debentures recorded at fair value were the estimated market interest rates used to fair value each debenture using the yield valuation technique described above. As of March 31, 2020, all of the SBIC debentures previously accounted for on a fair value basis have been repaid.

        The following tables provide a summary of changes for the Level 3 SBIC debentures recorded at fair value for the three-month periods ended March 31, 2020 and 2019 (amounts in thousands):

Type of Instrument
  Fair Value as of
December 31, 2019 		  Repayments   Net
Realized
Loss 		  New SBIC
Debentures 		  Net
Unrealized
(Appreciation)
Depreciation 		  Fair Value as of
March 31, 2020 		 

SBIC debentures at fair value

   $ 21,927   $ (22,000 ) $ 533   $ —   $ (460 ) $ —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

 

Type of Instrument
  Fair Value as of
December 31, 2018 		  Repayments   Net
Realized
Loss 		  New SBIC
Debentures 		  Net
Unrealized
(Appreciation)
Depreciation 		  Fair Value as of
March 31, 2019 		 

SBIC debentures at fair value

   $ 44,688   $ (24,000 ) $ 5,689   $ —   $ (5,177 ) $ 21,200  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

        The following tables provide a summary of the significant unobservable inputs used to fair value Main Street's Level 3 SBIC debentures as of December 31, 2019 (amounts in thousands):

Type of Instrument
  Fair Value as of
December 31, 2019 		  Valuation Technique   Significant Unobservable Inputs   Range   Weighted
Average 		 

SBIC debentures

   $ 21,927   Discounted cash flow   Estimated market interest rates   3.2% - 3.5%     3.2%  

        At March 31, 2020 and December 31, 2019, Main Street's investments and SBIC debentures at fair value were categorized as follows in the fair value hierarchy for ASC 820 purposes:

 
    
   Fair Value Measurements  
 
    
   (in thousands)
  
At March 31, 2020
  Fair Value   Quoted Prices in
Active Markets for
Identical Assets
(Level 1) 		  Significant Other
Observable Inputs
(Level 2) 		  Significant
Unobservable Inputs
(Level 3) 		 

LMM portfolio investments

   $ 1,168,150   $ —   $ —   $ 1,168,150  

Middle Market portfolio investments

     418,441     —     —     418,441  

Private Loan portfolio investments

     629,094     —     —     629,094  

Other Portfolio investments

     95,481     —     —     95,481  

External Investment Manager

     61,580     —     —     61,580  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Total investments

   $ 2,372,746   $ —   $ —   $ 2,372,746  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

SBIC debentures at fair value

   $ —   $ —   $ —   $ —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

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(Unaudited)

 
    
   Fair Value Measurements  
 
    
   (in thousands)
  
At December 31, 2019
  Fair Value   Quoted Prices in
Active Markets for
Identical Assets
(Level 1) 		  Significant Other
Observable Inputs
(Level 2) 		  Significant
Unobservable Inputs
(Level 3) 		 

LMM portfolio investments

   $ 1,206,865   $ —   $ —   $ 1,206,865  

Middle Market portfolio investments

     522,083     —     —     522,083  

Private Loan portfolio investments

     692,117     —     —     692,117  

Other Portfolio investments

     106,739     —     —     106,739  

External Investment Manager

     74,520     —     —     74,520  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Total investments

   $ 2,602,324   $ —   $ —   $ 2,602,324  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

SBIC debentures at fair value

   $ 21,927   $ —   $ —   $ 21,927  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Investment Portfolio Composition

        Main Street's LMM portfolio investments primarily consist of secured debt, equity warrants and direct equity investments in privately held, LMM companies based in the United States. Main Street's LMM portfolio companies generally have annual revenues between $10 million and $150 million, and its LMM investments generally range in size from $5 million to $50 million. The LMM debt investments are typically secured by either a first or second priority lien on the assets of the portfolio company, can include either fixed or floating rate terms and generally have a term of between five and seven years from the original investment date. In most LMM portfolio investments, Main Street receives nominally priced equity warrants and/or makes direct equity investments in connection with a debt investment.

        Main Street's Middle Market portfolio investments primarily consist of direct investments in or secondary purchases of interest-bearing debt securities in privately held companies based in the United States that are generally larger in size than the companies included in Main Street's LMM portfolio. Main Street's Middle Market portfolio companies generally have annual revenues between $150 million and $1.5 billion, and its Middle Market investments generally range in size from $3 million to $20 million. Main Street's Middle Market portfolio debt investments are generally secured by either a first or second priority lien on the assets of the portfolio company and typically have a term of between three and seven years from the original investment date.

        Main Street's private loan ("Private Loan") portfolio investments are primarily debt securities in privately held companies which have been originated through strategic relationships with other investment funds on a collaborative basis, and are often referred to in the debt markets as "club deals." Private Loan investments are typically similar in size, structure, terms and conditions to investments Main Street holds in its LMM portfolio and Middle Market portfolio. Main Street's Private Loan portfolio debt investments are generally secured by either a first or second priority lien on the assets of the portfolio company and typically have a term of between three and seven years from the original investment date.

        Main Street's other portfolio ("Other Portfolio") investments primarily consist of investments which are not consistent with the typical profiles for LMM, Middle Market and Private Loan portfolio

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(Unaudited)

investments, including investments which may be managed by third parties. In the Other Portfolio, Main Street may incur indirect fees and expenses in connection with investments managed by third parties, such as investments in other investment companies or private funds. For Other Portfolio investments, Main Street generally receives distributions related to the assets held by the portfolio company. Those assets are typically expected to be liquidated over a five to ten-year period.

        Main Street's external asset management business is conducted through its External Investment Manager. The External Investment Manager earns management fees based on the assets of the funds under management and may earn incentive fees, or a carried interest, based on the performance of the funds managed. Main Street entered into an agreement with the External Investment Manager to share employees in connection with its asset management business generally, and specifically for its relationship with HMS Income Fund, Inc. ("HMS Income"). Through this agreement, Main Street shares employees with the External Investment Manager, including their related infrastructure, business relationships, management expertise and capital raising capabilities. Main Street allocates the related expenses to the External Investment Manager pursuant to the sharing agreement. Main Street's total expenses for each of the three months ended March 31, 2020 and 2019 are net of expenses allocated to the External Investment Manager of $1.6 million.

        Investment income, consisting of interest, dividends and fees, can fluctuate dramatically due to various factors, including the level of new investment activity, repayments of debt investments or sales of equity interests. Investment income in any given year could also be highly concentrated among several portfolio companies. For the three months ended March 31, 2020 and 2019, Main Street did not record investment income from any single portfolio company in excess of 10% of total investment income.

        The following tables provide a summary of Main Street's investments in the LMM, Middle Market and Private Loan portfolios as of March 31, 2020 and December 31, 2019 (this information excludes the Other Portfolio investments and the External Investment Manager which are discussed further below):

 
   As of March 31, 2020  
 
   LMM(a)   Middle Market   Private Loan  
 
   (dollars in millions)
  

Number of portfolio companies

     70     48     63  

Fair value

   $ 1,168.2   $ 418.4   $ 629.1  

Cost

   $ 991.5   $ 540.8   $ 740.1  

% of portfolio at cost—debt

     64.1%     94.4%     94.6%  

% of portfolio at cost—equity

     35.9%     5.6%     5.4%  

% of debt investments at cost secured by first priority lien

     98.1%     90.8%     95.4%  

Weighted-average annual effective yield(b)

     11.8%     8.1%     9.0%  

Average EBITDA(c)

   $ 5.5   $ 80.6   $ 51.9  
(a)
At March 31, 2020, Main Street had equity ownership in approximately 99% of its LMM portfolio companies, and the average fully diluted equity ownership in those portfolio companies was approximately 41%.

(b)
The weighted-average annual effective yields were computed using the effective interest rates for all debt investments at cost as of March 31, 2020, including amortization of deferred debt

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(Unaudited)

    origination fees and accretion of original issue discount but excluding fees payable upon repayment of the debt instruments and any debt investments on non-accrual status. The weighted-average annual effective yield is higher than what an investor in shares of Main Street's common stock will realize on its investment because it does not reflect Main Street's expenses or any sales load paid by an investor.

(c)
The average EBITDA is calculated using a simple average for the LMM portfolio and a weighted-average for the Middle Market and Private Loan portfolios. These calculations exclude certain portfolio companies, including three LMM portfolio companies, one Middle Market portfolio company and three Private Loan portfolio companies, as EBITDA is not a meaningful valuation metric for Main Street's investments in these portfolio companies, and those portfolio companies whose primary purpose is to own real estate.
 
   As of December 31, 2019  
 
   LMM(a)   Middle Market   Private Loan  
 
   (dollars in millions)
  

Number of portfolio companies

     69     51     65  

Fair value

   $ 1,206.9   $ 522.1   $ 692.1  

Cost

   $ 1,002.2   $ 572.3   $ 734.8  

% of portfolio at cost—debt

     65.9%     94.8%     94.6%  

% of portfolio at cost—equity

     34.1%     5.2%     5.4%  

% of debt investments at cost secured by first priority lien

     98.1%     91.3%     95.4%  

Weighted-average annual effective yield(b)

     11.8%     8.6%     9.5%  

Average EBITDA(c)

   $ 5.1   $ 85.0   $ 57.8  
(a)
At December 31, 2019, Main Street had equity ownership in approximately 99% of its LMM portfolio companies, and the average fully diluted equity ownership in those portfolio companies was approximately 42%.

(b)
The weighted-average annual effective yields were computed using the effective interest rates for all debt investments at cost as of December 31, 2019, including amortization of deferred debt origination fees and accretion of original issue discount but excluding fees payable upon repayment of the debt instruments and any debt investments on non-accrual status. The weighted-average annual effective yield is higher than what an investor in shares of Main Street's common stock will realize on its investment because it does not reflect Main Street's expenses or any sales load paid by an investor.

(c)
The average EBITDA is calculated using a simple average for the LMM portfolio and a weighted-average for the Middle Market and Private Loan portfolios. These calculations exclude certain portfolio companies, including three LMM portfolio companies, two Middle Market portfolio companies and three Private Loan portfolio companies, as EBITDA is not a meaningful valuation metric for Main Street's investments in these portfolio companies, and those portfolio companies whose primary purpose is to own real estate.

        As of March 31, 2020, Main Street had Other Portfolio investments in eleven companies, collectively totaling approximately $95.5 million in fair value and approximately $118.5 million in cost basis and which comprised approximately 4.0% of Main Street's Investment Portfolio at fair value. As of December 31, 2019, Main Street had Other Portfolio investments in eleven companies, collectively

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Notes to Consolidated Financial Statements (Continued)

(Unaudited)

totaling approximately $106.7 million in fair value and approximately $118.4 million in cost basis and which comprised approximately 4.1% of Main Street's Investment Portfolio at fair value.

        As discussed further in Note A.1., Main Street holds an investment in the External Investment Manager, a wholly owned subsidiary that is treated as a portfolio investment. As of March 31, 2020, there was no cost basis in this investment and the investment had a fair value of approximately $61.6 million, which comprised approximately 2.6% of Main Street's Investment Portfolio at fair value. As of December 31, 2019, there was no cost basis in this investment and the investment had a fair value of approximately $74.5 million, which comprised approximately 2.9% of Main Street's Investment Portfolio at fair value.

        The following tables summarize the composition of Main Street's total combined LMM portfolio investments, Middle Market portfolio investments and Private Loan portfolio investments at cost and fair value by type of investment as a percentage of the total combined LMM portfolio investments, Middle Market portfolio investments and Private Loan portfolio investments, as of March 31, 2020 and December 31, 2019 (this information excludes the Other Portfolio investments and the External Investment Manager).

Cost:
  March 31, 2020   December 31, 2019  

First lien debt

     77.3%     78.2%  

Equity

     18.2%     17.2%  

Second lien debt

     3.5%     3.5%  

Equity warrants

     0.5%     0.6%  

Other

     0.5%     0.5%  
​ ​ ​ ​ ​ ​ ​ ​

    100.0%     100.0%  
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​

 

Fair Value:
  March 31, 2020   December 31, 2019  

First lien debt

     69.1%     70.1%  

Equity

     27.2%     26.0%  

Second lien debt

     2.8%     3.0%  

Equity warrants

     0.4%     0.4%  

Other

     0.5%     0.5%  
​ ​ ​ ​ ​ ​ ​ ​

    100.0%     100.0%  
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​

        The following tables summarize the composition of Main Street's total combined LMM portfolio investments, Middle Market portfolio investments and Private Loan portfolio investments by geographic region of the United States and other countries at cost and fair value as a percentage of the total combined LMM portfolio investments, Middle Market portfolio investments and Private Loan portfolio investments, as of March 31, 2020 and December 31, 2019 (this information excludes the Other

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Notes to Consolidated Financial Statements (Continued)

(Unaudited)

Portfolio investments and the External Investment Manager). The geographic composition is determined by the location of the corporate headquarters of the portfolio company.

Cost:
  March 31, 2020   December 31, 2019  

Southwest

     26.3%     25.0%  

West

     22.0%     24.6%  

Midwest

     20.0%     20.6%  

Northeast

     16.7%     14.8%  

Southeast

     13.3%     13.2%  

Canada

     1.2%     1.2%  

Other Non-United States

     0.5%     0.6%  
​ ​ ​ ​ ​ ​ ​ ​

    100.0%     100.0%  
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​

 

Fair Value:
  March 31, 2020   December 31, 2019  

Southwest

     27.6%     26.7%  

West

     23.1%     25.1%  

Midwest

     19.9%     20.6%  

Northeast

     16.4%     14.4%  

Southeast

     11.5%     11.6%  

Canada

     1.0%     1.1%  

Other Non-United States

     0.5%     0.5%  
​ ​ ​ ​ ​ ​ ​ ​

    100.0%     100.0%  
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​

        Main Street's LMM portfolio investments, Middle Market portfolio investments and Private Loan portfolio investments are in companies conducting business in a variety of industries. The following tables summarize the composition of Main Street's total combined LMM portfolio investments, Middle Market portfolio investments and Private Loan portfolio investments by industry at cost and fair value

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Notes to Consolidated Financial Statements (Continued)

(Unaudited)

as of March 31, 2020 and December 31, 2019 (this information excludes the Other Portfolio investments and the External Investment Manager).

Cost:
  March 31, 2020   December 31, 2019  

Machinery

     7.9%     7.7%  

Commercial Services & Supplies

     5.4%     6.1%  

Aerospace & Defense

     5.1%     4.9%  

Energy Equipment & Services

     5.0%     5.4%  

Construction & Engineering

     4.9%     5.4%  

IT Services

     4.9%     4.6%  

Health Care Providers & Services

     4.7%     4.5%  

Internet Software & Services

     4.3%     4.1%  

Media

     4.0%     5.3%  

Diversified Telecommunication Services

     4.0%     3.9%  

Leisure Equipment & Products

     4.0%     3.8%  

Hotels, Restaurants & Leisure

     3.8%     3.7%  

Electronic Equipment, Instruments & Components

     3.6%     3.5%  

Oil, Gas & Consumable Fuels

     3.3%     3.6%  

Specialty Retail

     3.1%     3.1%  

Communications Equipment

     3.1%     3.1%  

Professional Services

     3.0%     2.9%  

Food Products

     2.8%     3.0%  

Software

     2.5%     2.4%  

Distributors

     2.5%     1.1%  

Diversified Financial Services

     1.9%     1.9%  

Containers & Packaging

     1.7%     1.7%  

Computers & Peripherals

     1.5%     2.3%  

Diversified Consumer Services

     1.4%     0.4%  

Trading Companies & Distributors

     1.3%     0.0%  

Transportation Infrastructure

     1.2%     1.0%  

Food & Staples Retailing

     1.1%     1.0%  

Construction Materials

     1.0%     1.0%  

Chemicals

     1.0%     1.0%  

Internet & Catalog Retail

     1.0%     0.9%  

Building Products

     0.9%     1.3%  

Road & Rail

     0.4%     1.4%  

Other(1)

     3.7%     4.0%  
​ ​ ​ ​ ​ ​ ​ ​

    100.0%     100.0%  
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​
(1)
Includes various industries with each industry individually less than 1.0% of the total combined LMM portfolio investments, Middle Market portfolio investments and Private Loan portfolio investments at each date.

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(Unaudited)

Fair Value:
  March 31, 2020   December 31, 2019  

Machinery

     10.2%     9.9%  

Construction & Engineering

     5.4%     5.6%  

IT Services

     5.3%     4.8%  

Aerospace & Defense

     4.9%     4.7%  

Commercial Services & Supplies

     4.6%     5.5%  

Energy Equipment & Services

     4.4%     4.9%  

Health Care Providers & Services

     4.3%     4.3%  

Internet Software & Services

     4.2%     3.8%  

Media

     3.7%     4.7%  

Leisure Equipment & Products

     3.6%     3.5%  

Specialty Retail

     3.5%     3.4%  

Diversified Consumer Services

     3.3%     2.2%  

Computers & Peripherals

     3.2%     3.8%  

Diversified Telecommunication Services

     3.2%     3.3%  

Software

     3.0%     2.7%  

Electronic Equipment, Instruments & Components

     2.7%     2.7%  

Hotels, Restaurants & Leisure

     2.6%     3.3%  

Oil, Gas & Consumable Fuels

     2.6%     3.2%  

Food Products

     2.5%     2.7%  

Communications Equipment

     2.5%     2.7%  

Distributors

     2.4%     1.0%  

Diversified Financial Services

     2.1%     2.1%  

Professional Services

     1.9%     2.2%  

Containers & Packaging

     1.9%     1.7%  

Construction Materials

     1.6%     1.5%  

Trading Companies & Distributors

     1.2%     0.0%  

Building Products

     1.1%     1.2%  

Transportation Infrastructure

     1.1%     1.0%  

Food & Staples Retailing

     1.1%     1.0%  

Air Freight & Logistics

     1.0%     0.8%  

Road & Rail

     0.6%     1.5%  

Other(1)

     4.3%     4.3%  
​ ​ ​ ​ ​ ​ ​ ​

    100.0%     100.0%  
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​
(1)
Includes various industries with each industry individually less than 1.0% of the total combined LMM portfolio investments, Middle Market portfolio investments and Private Loan portfolio investments at each date.

        At March 31, 2020 and December 31, 2019, Main Street had no portfolio investment that was greater than 10% of the Investment Portfolio at fair value.

Unconsolidated Significant Subsidiaries

        In accordance with Rules 3-09 and 4-08(g) of Regulation S-X, Main Street must determine which of its unconsolidated controlled portfolio companies, if any, are considered "significant subsidiaries." In

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Notes to Consolidated Financial Statements (Continued)

(Unaudited)

evaluating these unconsolidated controlled portfolio companies, there are three tests utilized to determine if any of Main Street's Control Investments (as defined in Note A, including those unconsolidated portfolio companies defined as Control Investments in which Main Street does not own greater than 50% of the voting securities or maintain greater than 50% of the board representation) are considered significant subsidiaries: the investment test, the asset test and the income test. The income test is measured by dividing the absolute value of the combined total of total investment income, net realized gain (loss) and net unrealized appreciation (depreciation) from each Control Investment for the period being tested by the absolute value of Main Street's pre-tax income for the same period. Rule 3-09 of Regulation S-X, as interpreted by the SEC, requires Main Street to include separate audited financial statements of an unconsolidated majority-owned subsidiary (Control Investments in which Main Street owns greater than 50% of the voting securities) in an annual report if any of the three tests exceed 20% of Main Street's total investments at fair value, total assets or total income, respectively. Rule 4-08(g) of Regulation S-X requires summarized financial information of a Control Investment in an annual report if any of the three tests exceeds 10% of Main Street's annual total amounts and Rule 10-01(b)(1) of Regulation S-X requires summarized financial information in a quarterly report if any of the three tests exceeds 20% of Main Street's year-to-date total amounts.

        As of March 31, 2020 and December 31, 2019, Main Street had no single investment that represented greater than 20% of its total Investment Portfolio at fair value and no single investment whose total assets represented greater than 20% of its total assets. After performing the income test for the three months ended March 31, 2020 and 2019, Main Street determined that no single Control Investment had income that represented greater than 20% of Main Street's total income.

NOTE D—EXTERNAL INVESTMENT MANAGER

        As discussed further in Note A.1., the External Investment Manager provides investment management and other services to External Parties. The External Investment Manager is accounted for as a portfolio investment of MSCC since the External Investment Manager conducts all of its investment management activities for External Parties.

        During May 2012, Main Street entered into an investment sub-advisory agreement with HMS Adviser, LP ("HMS Adviser"), which is the investment advisor to HMS Income, a non-listed BDC, to provide certain investment advisory services to HMS Adviser. In December 2013, after obtaining required no-action relief from the SEC to allow it to own a registered investment adviser, Main Street assigned the sub-advisory agreement to the External Investment Manager since the fees received from such arrangement could otherwise have negative consequences on MSCC's ability to meet the source-of-income requirement necessary for it to maintain its RIC tax treatment. Under the investment sub-advisory agreement, the External Investment Manager is entitled to 50% of the base management fee and the incentive fees earned by HMS Adviser under its advisory agreement with HMS Income. During the three months ended March 31, 2020 and 2019, the External Investment Manager earned $2.5 million and $3.0 million, respectively, in management fee income. No incentive fee income was earned in the three months ended March 31, 2020 compared to $0.1 million earned in the three months ended March 31, 2019.

        The investment in the External Investment Manager is accounted for using fair value accounting, with the fair value determined by Main Street and approved, in good faith, by Main Street's Board of Directors. Main Street determines the fair value of the External Investment Manager using the Waterfall valuation method under the market approach (see further discussion in Note B.1.). Any change in fair value of the investment in the External Investment Manager is recognized on Main Street's consolidated statements of operations in "Net Unrealized Appreciation (Depreciation)—Control investments."

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Notes to Consolidated Financial Statements (Continued)

(Unaudited)

        The External Investment Manager is an indirect wholly owned subsidiary of MSCC owned through a Taxable Subsidiary and is a disregarded entity for tax purposes. The External Investment Manager has entered into a tax sharing agreement with its Taxable Subsidiary owner. Since the External Investment Manager is accounted for as a portfolio investment of MSCC and is not included as a consolidated subsidiary of MSCC in MSCC's consolidated financial statements, and as a result of the tax sharing agreement with its Taxable Subsidiary owner, for financial reporting purposes the External Investment Manager is treated as if it is taxed at normal corporate tax rates based on its taxable income and, as a result of its activities, may generate income tax expense or benefit. Main Street owns the External Investment Manager through the Taxable Subsidiary to allow MSCC to continue to comply with the "source-of-income" requirements contained in the RIC tax provisions of the Code. The taxable income, or loss, of the External Investment Manager may differ from its book income, or loss, due to temporary book and tax timing differences and permanent differences. As a result of the above described financial reporting and tax treatment, the External Investment Manager provides for any income tax expense, or benefit, and any tax assets or liabilities in its separate financial statements.

        Main Street shares employees with the External Investment Manager and allocates costs related to such shared employees to the External Investment Manager generally based on a combination of the direct time spent, new investment origination activity and assets under management, depending on the nature of the expense. For each of the three months ended March 31, 2020 and 2019, Main Street allocated $1.6 million of total expenses to the External Investment Manager. The total contribution of the External Investment Manager to Main Street's net investment income consists of the combination of the expenses allocated to the External Investment Manager and the dividend income received from the External Investment Manager. For the three months ended March 31, 2020 and 2019, the total contribution to Main Street's net investment income was $2.3 million and $2.7 million, respectively.

        Summarized financial information from the separate financial statements of the External Investment Manager as of March 31, 2020 and December 31, 2019 and for the three months ended March 31, 2020 and 2019 is as follows:

 
   Three Months
Ended
March 31, 		 
 
   2020   2019  
 
   (dollars in thousands)
  

Management fee income

   $ 2,499   $ 2,877  

Incentive fees

     —     80  
​ ​ ​ ​ ​ ​ ​ ​

Total revenues

     2,499     2,957  

Expenses allocated from MSCC or its subsidiaries:

    
 		    
 		  

Salaries, share-based compensation and other personnel costs

     (1,060 )   (1,055 )

Other G&A expenses

     (584 )   (588 )
​ ​ ​ ​ ​ ​ ​ ​

Total allocated expenses

     (1,644 )   (1,643 )
​ ​ ​ ​ ​ ​ ​ ​

Pre-tax income

     855     1,314  

Tax expense

     (195 )   (294 )
​ ​ ​ ​ ​ ​ ​ ​

Net income

   $ 660   $ 1,020  
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​

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Notes to Consolidated Financial Statements (Continued)

(Unaudited)


 
   As of
March 31, 		  As of
December 31, 		 
 
   2020   2019  
 
   (dollars in thousands)
  

Cash

   $ —   $ —  

Accounts receivable—HMS Income

     2,513     2,708  
​ ​ ​ ​ ​ ​ ​ ​

Total assets

   $ 2,513   $ 2,708  
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​

Accounts payable to MSCC and its subsidiaries

   $ 1,853   $ 1,592  

Dividend payable to MSCC and its subsidiaries

     660     1,116  

Equity

     —     —  
​ ​ ​ ​ ​ ​ ​ ​

Total liabilities and equity

   $ 2,513   $ 2,708  
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​

NOTE E—DEBT

SBIC Debentures

        Under existing SBIC regulations, SBA-approved SBICs under common control have the ability to issue debentures guaranteed by the SBA up to a regulatory maximum amount of $350.0 million. Main Street's SBIC debentures payable, under existing SBA-approved commitments, were $304.8 million and $311.8 million at March 31, 2020 and December 31, 2019, respectively. SBIC debentures provide for interest to be paid semiannually, with principal due at the applicable 10-year maturity date of each debenture. During the three months ended March 31, 2020, Main Street issued $15.0 million of SBIC debentures and opportunistically prepaid the remaining $22.0 million of existing MSC II SBIC debentures. As a result of this prepayment, Main Street recognized a realized loss of $0.5 million, due primarily to the write-off of the related unamortized deferred financing costs. Subsequent to March 31, 2020, Main Street received an additional commitment from the SBA enabling Main Street to issue new SBIC debentures in the future, increasing its total commitment from the SBA to the regulatory maximum of $350.0 million. Main Street expects to issue new SBIC debentures under the SBIC program in the future in an amount up to the regulatory maximum amount for affiliated SBIC funds. The weighted-average annual interest rate on the SBIC debentures was 3.5% and 3.6% as of March 31, 2020 and December 31, 2019, respectively. The first principal maturity due under the existing SBIC debentures is in 2020, and the weighted-average remaining duration as of March 31, 2020 was approximately 5.4 years. For the three months ended March 31, 2020 and 2019, Main Street recognized interest expense, including the amortization of upfront leverage and other miscellaneous fees, attributable to the SBIC debentures of $3.0 million and $3.3 million, respectively. In accordance with SBIC regulations, the Funds are precluded from incurring additional non-SBIC debt without the prior approval of the SBA.

        As of March 31, 2020, the recorded value of the SBIC debentures was $299.1 million, which consisted of (i) $139.8 million par value of SBIC debentures outstanding issued by MSMF, with a recorded value of $138.6 million that was net of unamortized debt issuance costs of $1.2 million and (ii) $165.0 million par value of SBIC debentures issued by MSC III with a recorded value of $160.5 million that was net of unamortized debt issuance costs of $4.5 million. As of March 31, 2020, if Main Street had adopted the fair value option under ASC 825 for its SBIC debentures, Main Street estimates the fair value of its SBIC debentures would be approximately $252.5 million, or $52.3 million less than the $304.8 million face value of the SBIC debentures.

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Notes to Consolidated Financial Statements (Continued)

(Unaudited)

Credit Facility

        Main Street maintains the Credit Facility to provide additional liquidity to support its investment and operational activities. The Credit Facility was amended during March 2020 to provide for an increase in total commitments from $705.0 million to $740.0 million and to increase the diversified group of lenders to 18 lenders. The Credit Facility matures in September 2023 and contains an accordion feature which allows Main Street to increase the total commitments under the facility to up to $800.0 million from new and existing lenders on the same terms and conditions as the existing commitments.

        Borrowings under the Credit Facility bear interest, subject to Main Street's election and resetting on a monthly basis on the first of each month, on a per annum basis at a rate equal to the applicable LIBOR rate (1.0% as of March 31, 2020) plus (i) 1.875% (or the applicable base rate (Prime Rate of 3.25% as of March 31, 2020) plus 0.875%) as long as Main Street meets certain agreed upon excess collateral and maximum leverage requirements or (ii) 2.0% (or the applicable base rate plus 1.0%) otherwise. Main Street pays unused commitment fees of 0.25% per annum on the unused lender commitments under the Credit Facility. The Credit Facility is secured by a first lien on the assets of MSCC and its subsidiaries, excluding the equity ownership or assets of the Funds and the External Investment Manager. The Credit Facility contains certain affirmative and negative covenants, including but not limited to: (i) maintaining a minimum availability of at least 10% of the borrowing base, (ii) maintaining an interest coverage ratio of at least 2.0 to 1.0, (iii) maintaining an asset coverage ratio (tangible net worth to Credit Facility borrowings) of at least 1.5 to 1.0 and (iv) maintaining a minimum tangible net worth. The Credit Facility is provided on a revolving basis through its final maturity date in September 2023, and contains two, one-year extension options which could extend the final maturity by up to two years, subject to certain conditions, including lender approval.

        At March 31, 2020, Main Street had $277.0 million in borrowings outstanding under the Credit Facility. As of March 31, 2020, if Main Street had adopted the fair value option under ASC 825 for its Credit Facility, Main Street estimates its fair value would approximate its recorded value. Main Street recognized interest expense related to the Credit Facility, including unused commitment fees and amortization of deferred issuance costs, of $2.9 million and $4.2 million for the three months ended March 31, 2020 and 2019, respectively. As of March 31, 2020, the interest rate on the Credit Facility was 3.5% (based on the LIBOR rate of 1.6% as of the most recent reset date plus 1.875%). The average interest rate for borrowings under the Credit Facility was 3.5% and 4.4% for the three months ended March 31, 2020 and 2019, respectively. As of March 31, 2020, Main Street was in compliance with all financial covenants of the Credit Facility.

4.50% Notes due 2019

        In November 2014, Main Street issued $175.0 million in aggregate principal amount of 4.50% unsecured notes due 2019 (the "4.50% Notes due 2019") at an issue price of 99.53%. The 4.50% Notes due 2019 bore interest at a rate of 4.50% per year payable semiannually on June 1 and December 1 of each year. On December 2, 2019, Main Street repaid the entire principal amount of the issued and outstanding 4.50% Notes due 2019, effective December 1, 2019 (the "Maturity Date"), at par value plus the accrued and unpaid interest thereon from June 1, 2019 through the Maturity Date. Main Street recognized no interest expense related to the 4.50% Notes due 2019, including amortization of unamortized deferred issuance costs, for the three months ended March 31, 2020 and $2.1 million for the three months ended March 31, 2019.

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Notes to Consolidated Financial Statements (Continued)

(Unaudited)

4.50% Notes due 2022

        In November 2017, Main Street issued $185.0 million in aggregate principal amount of 4.50% unsecured notes due December 1, 2022 (the "4.50% Notes due 2022") at an issue price of 99.16%. The 4.50% Notes due 2022 are unsecured obligations and rank pari passu with Main Street's current and future unsecured indebtedness; senior to any of its future indebtedness that expressly provides it is subordinated to the 4.50% Notes due 2022; effectively subordinated to all of its existing and future secured indebtedness, to the extent of the value of the assets securing such indebtedness, including borrowings under its Credit Facility; and structurally subordinated to all existing and future indebtedness and other obligations of any of its subsidiaries, including without limitation, the indebtedness of the Funds. The 4.50% Notes due 2022 may be redeemed in whole or in part at any time at Main Street's option subject to certain make-whole provisions. The 4.50% Notes due 2022 bear interest at a rate of 4.50% per year payable semiannually on June 1 and December 1 of each year. The total net proceeds from the 4.50% Notes due 2022, resulting from the issue price and after underwriting discounts and estimated offering expenses payable, were approximately $182.2 million. Main Street may from time to time repurchase the 4.50% Notes due 2022 in accordance with the 1940 Act and the rules promulgated thereunder. As of March 31, 2020, the outstanding balance of the 4.50% Notes due 2022 was $185.0 million and the recorded value of $183.4 million was net of unamortized debt issuance costs of $1.6 million. As of March 31, 2020, if Main Street had adopted the fair value option under ASC 825 for the 4.50% Notes due 2022, Main Street estimates its fair value would be approximately $180.9 million. Main Street recognized interest expense related to the 4.50% Notes due 2022, including amortization of unamortized deferred issuance costs, of $2.2 million for each of the three months ended March 31, 2020 and 2019.

        The indenture governing the 4.50% Notes due 2022 (the "4.50% Notes due 2022 Indenture") contains certain covenants, including covenants requiring Main Street's compliance with (regardless of whether Main Street is subject to) the asset coverage requirements set forth in Section 18(a)(1)(A) as modified by Section 61(a)(1) of the 1940 Act, as well as covenants requiring Main Street to provide financial information to the holders of the 4.50% Notes due 2022 and the Trustee if Main Street ceases to be subject to the reporting requirements of the Exchange Act. These covenants are subject to limitations and exceptions that are described in the 4.50% Notes due 2022 Indenture. As of March 31, 2020, Main Street was in compliance with these covenants.

5.20% Notes

        In April 2019, Main Street issued $250.0 million in aggregate principal amount of 5.20% unsecured notes due May 1, 2024 (the "5.20% Notes") at an issue price of 99.125%. Subsequently, in December 2019, Main Street issued an additional $75.0 million of the 5.20% Notes at an issue price of 105.0%. The 5.20% Notes issued in December 2019 have identical terms as, and are a part of a single series with, the 5.20% Notes issued in April 2019. The 5.20% Notes are unsecured obligations and rank pari passu with Main Street's current and future unsecured indebtedness; senior to any of its future indebtedness that expressly provides it is subordinated to the 5.20% Notes; effectively subordinated to all of its existing and future secured indebtedness, to the extent of the value of the assets securing such indebtedness, including borrowings under its Credit Facility; and structurally subordinated to all existing and future indebtedness and other obligations of any of its subsidiaries, including without limitation, the indebtedness of the Funds. The 5.20% Notes may be redeemed in whole or in part at any time at Main Street's option subject to certain make-whole provisions. The 5.20% Notes bear interest at a rate of 5.20% per year payable semiannually on May 1 and November 1 of each year. The total net

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(Unaudited)

proceeds from the 5.20% Notes, resulting from the issue price and after underwriting discounts and estimated offering expenses payable, were approximately $324.1 million. Main Street may from time to time repurchase the 5.20% Notes in accordance with the 1940 Act and the rules promulgated thereunder. As of March 31, 2020, the outstanding balance of the 5.20% Notes was $325.0 million and the recorded value of $324.5 million was net of unamortized debt issuance costs of $0.5 million. As of March 31, 2020, if Main Street had adopted the fair value option under ASC 825 for the 5.20% Notes, Main Street estimates its fair value would be approximately $303.3 million. Main Street recognized interest expense related to the 5.20% Notes, including amortization of unamortized deferred issuance costs, of $4.3 million for the three months ended March 31, 2020.

        The indenture governing the 5.20% Notes (the "5.20% Notes Indenture") contains certain covenants, including covenants requiring Main Street's compliance with (regardless of whether Main Street is subject to) the asset coverage requirements set forth in Section 18(a)(1)(A) as modified by Section 61(a)(1) of the 1940 Act, as well as covenants requiring Main Street to provide financial information to the holders of the 5.20% Notes and the Trustee if Main Street ceases to be subject to the reporting requirements of the Exchange Act. These covenants are subject to limitations and exceptions that are described in the 5.20% Notes Indenture. As of March 31, 2020, Main Street was in compliance with these covenants.

NOTE F—FINANCIAL HIGHLIGHTS

 
   Three Months Ended March 31,  
 
   2020   2019  

Per Share Data:

              

NAV at the beginning of the period

   $ 23.91   $ 24.09  

Net investment income(1)

     0.57     0.64  

Net realized loss(1)(2)

     (0.35 )   (0.18 )

Net unrealized appreciation (depreciation)(1)(2)

     (3.00 )   0.27  

Income tax benefit (provision)(1)(2)

     0.12     (0.06 )
​ ​ ​ ​ ​ ​ ​ ​

Net increase (decrease) in net assets resulting from operations(1)

     (2.66 )   0.67  

Dividends paid from net investment income

     (0.62 )   (0.59 )

Accretive effect of stock offerings (issuing shares above NAV per share)

     0.03     0.20  

Accretive effect of DRIP issuance (issuing shares above NAV per share)

     0.03     0.02  

Other(3)

     0.04     0.02  
​ ​ ​ ​ ​ ​ ​ ​

NAV at the end of the period

   $ 20.73   $ 24.41  
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​

Market value at the end of the period

   $ 20.51   $ 37.20  

Shares outstanding at the end of the period

     64,462,649     62,373,777  
(1)
Based on weighted-average number of common shares outstanding for the period.

(2)
Net realized gains or losses, net unrealized appreciation or depreciation, and income taxes can fluctuate significantly from period to period.

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(Unaudited)

(3)
Includes the impact of the different share amounts as a result of calculating certain per share data based on the weighted-average basic shares outstanding during the period and certain per share data based on the shares outstanding as of a period end or transaction date.
 
   Three Months Ended
March 31, 		 
 
   2020   2019  
 
   (dollars in thousands)
  

NAV at end of period

   $ 1,336,170   $ 1,522,497  

Average NAV

   $ 1,436,280   $ 1,499,273  

Average outstanding debt

   $ 1,100,800   $ 1,026,050  

Ratio of total expenses, including income tax expense, to average NAV(1)(2)

     0.79%     1.66%  

Ratio of operating expenses to average NAV(2)(3)

     1.36%     1.46%  

Ratio of operating expenses, excluding interest expense, to average NAV(2)(3)

     0.50%     0.66%  

Ratio of net investment income to average NAV(2)

     2.54%     2.63%  

Portfolio turnover ratio(2)

     5.57%     2.78%  

Total investment return(2)(4)

     (51.61)%     11.76%  

Total return based on change in NAV(2)(5)

     (11.16)%     2.80%  
(1)
Total expenses are the sum of operating expenses and net income tax provision/benefit. Net income tax provision/benefit includes the accrual of net deferred tax provision/benefit relating to the net unrealized appreciation/depreciation on portfolio investments held in Taxable Subsidiaries and due to the change in the loss carryforwards, which are non-cash in nature and may vary significantly from period to period. Main Street is required to include net deferred tax provision/benefit in calculating its total expenses even though these net deferred taxes are not currently payable/receivable.

(2)
Not annualized.

(3)
Unless otherwise noted, operating expenses include interest, compensation, general and administrative and share-based compensation expenses, net of expenses allocated to the External Investment Manager.

(4)
Total investment return is based on the purchase of stock at the current market price on the first day and a sale at the current market price on the last day of each period reported on the table and assumes reinvestment of dividends at prices obtained by Main Street's dividend reinvestment plan during the period. The return does not reflect any sales load that may be paid by an investor.

(5)
Total return is based on change in net asset value was calculated using the sum of ending net asset value plus dividends to stockholders and other non-operating changes during the period, as divided by the beginning net asset value. Non-operating changes include any items that affect net asset value other than the net increase in net assets resulting from operations, such as the effects of stock offerings, shares issued under the DRIP and equity incentive plans and other miscellaneous items.

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(Unaudited)

NOTE G—DIVIDENDS, DISTRIBUTIONS AND TAXABLE INCOME

        Main Street paid regular monthly dividends of $0.205 per share for each month of January through March 2020, totaling $39.7 million, or $0.615 per share, for the three months ended March 31, 2020. The first quarter 2020 regular monthly dividends represent a 5.1% increase from the regularly monthly dividends paid for the first quarter of 2019. The regular monthly dividends equaled a total of approximately $36.0 million, or $0.585 per share, for the three months ended March 31, 2019.

        MSCC has elected to be treated for U.S. federal income tax purposes as a RIC. MSCC's taxable income includes the taxable income generated by MSCC and certain of its subsidiaries, including the Funds, which are treated as disregarded entities for tax purposes. As a RIC, MSCC generally will not pay corporate-level U.S. federal income taxes on any net ordinary taxable income or capital gains that MSCC distributes to its stockholders. MSCC must generally distribute at least 90% of its "investment company taxable income" (which is generally its net ordinary taxable income and realized net short-term capital gains in excess of realized net long-term capital losses) and 90% of its tax-exempt income to maintain its RIC status (pass-through tax treatment for amounts distributed). As part of maintaining RIC status, undistributed taxable income (subject to a 4% non-deductible U.S. federal excise tax) pertaining to a given fiscal year may be distributed up to 12 months subsequent to the end of that fiscal year, provided such dividends are declared on or prior to the later of (i) filing of the U.S. federal income tax return for the applicable fiscal year or (ii) the fifteenth day of the ninth month following the close of the year in which such taxable income was generated.

        The determination of the tax attributes for Main Street's distributions is made annually, based upon its taxable income for the full year and distributions paid for the full year. Therefore, a determination made on an interim basis may not be representative of the actual tax attributes of distributions for a full year. Ordinary dividend distributions from a RIC do not qualify for the 20% maximum tax rate (plus a 3.8% Medicare surtax, if applicable) on dividend income from domestic corporations and qualified foreign corporations, except to the extent that the RIC received the income in the form of qualifying dividends from domestic corporations and qualified foreign corporations. The tax attributes for distributions will generally include both ordinary income and qualified dividends, but may also include either one or both of capital gains and return of capital.

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(Unaudited)

        Listed below is a reconciliation of "Net increase (decrease) in net assets resulting from operations" to taxable income and to total distributions declared to common stockholders for the three months ended March 31, 2020 and 2019.

 
   Three months ended March 31,  
 
   2020   2019  
 
   (estimated, dollars in thousands)
  

Net increase (decrease) in net assets resulting from operations

   $ (171,438 ) $ 41,401  

Book-tax difference from share-based compensation expense

     2,720     2,329  

Net unrealized (appreciation) depreciation

     193,848     (16,401 )

Income tax provision

     (8,264 )   3,069  

Pre-tax book (income) loss not consolidated for tax purposes

     6,785     (7,698 )

Book income and tax income differences, including debt origination, structuring fees, dividends, realized gains and changes in estimates

     21,879     20,132  
​ ​ ​ ​ ​ ​ ​ ​

Estimated taxable income(1)

     45,530     42,832  

Taxable income earned in prior year and carried forward for distribution in current year

     29,107     41,489  

Taxable income earned prior to period end and carried forward for distribution next period

     (48,149 )   (60,217 )

Dividend payable as of period end and paid in the following period

     13,218     12,445  
​ ​ ​ ​ ​ ​ ​ ​

Total distributions accrued or paid to common stockholders

   $ 39,706   $ 36,549  
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​
(1)
Main Street's taxable income for each period is an estimate and will not be finally determined until the company files its tax return for each year. Therefore, the final taxable income, and the taxable income earned in each period and carried forward for distribution in the following period, may be different than this estimate.

        The Taxable Subsidiaries primarily hold certain portfolio investments for Main Street. The Taxable Subsidiaries permit Main Street to hold equity investments in portfolio companies which are "pass-through" entities for tax purposes and to continue to comply with the "source-of-income" requirements contained in the RIC tax provisions of the Code. The Taxable Subsidiaries are consolidated with Main Street for U.S. GAAP financial reporting purposes, and the portfolio investments held by the Taxable Subsidiaries are included in Main Street's consolidated financial statements as portfolio investments and recorded at fair value. The Taxable Subsidiaries are not consolidated with MSCC for income tax purposes and may generate income tax expense, or benefit, and tax assets and liabilities, as a result of their ownership of certain portfolio investments. The taxable income, or loss, of the Taxable Subsidiaries may differ from their book income, or loss, due to temporary book and tax timing differences and permanent differences. The Taxable Subsidiaries are each taxed at their normal corporate tax rates based on their taxable income. The income tax expense, or benefit, if any, and the related tax assets and liabilities, of the Taxable Subsidiaries are reflected in Main Street's consolidated financial statements.

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(Unaudited)

        The income tax provision (benefit) for Main Street is generally composed of (i) deferred tax expense (benefit), which is primarily the result of the net activity relating to the portfolio investments held in the Taxable Subsidiaries, including changes in loss carryforwards, changes in net unrealized appreciation or depreciation and other temporary book tax differences, and (ii) current tax expense, which is primarily the result of current U.S. federal income and state taxes and excise taxes on Main Street's estimated undistributed taxable income. For the three months ended March 31, 2020, Main Street recognized a net income tax benefit of $8.3 million, principally consisting of a deferred tax benefit of $8.0 million, as well as a $0.3 million current tax benefit, which is primarily related to a $0.8 million benefit for current U.S. federal income and state taxes, partially offset by a $0.5 million provision for excise taxes. For the three months ended March 31, 2019, Main Street recognized a net income tax provision of $3.1 million, principally consisting of a deferred tax provision of $2.4 million and a $0.7 million current tax expense, which is primarily related to a $0.3 million accrual for excise taxes and $0.4 million provision for current U.S. federal income and state taxes.

        The net deferred tax liability at March 31, 2020 was $8.4 million compared to $16.1 million at December 31, 2019, primarily related to changes in net unrealized appreciation or depreciation, changes in loss carryforwards, and other temporary book-tax differences relating to portfolio investments held by the Taxable Subsidiaries. At March 31, 2020, for U.S. federal income tax purposes, the Taxable Subsidiaries had a net operating loss carryforward from prior years which, if unused, will expire in various taxable years from 2029 through 2037. Any net operating losses generated in 2019 and future periods are not subject to expiration and will carryforward indefinitely until utilized. The timing and manner in which Main Street will utilize any loss carryforwards generated before December 31, 2019 may be limited in the future under the provisions of the Code. Additionally, the Taxable Subsidiaries have interest expense limitation carryforwards which have an indefinite carryforward.

NOTE H—COMMON STOCK

        Main Street maintains a program with certain selling agents through which it can sell shares of its common stock by means of at-the-market offerings from time to time (the "ATM Program"). During the three months ended March 31, 2020, Main Street sold 87,500 shares of its common stock at a weighted-average price of $43.39 per share and raised $3.8 million of gross proceeds under the ATM Program. Net proceeds were $3.7 million after commissions to the selling agents on shares sold and offering costs. As of March 31, 2020, 8,271,650 shares remained available for sale under the ATM Program.

        During the year ended December 31, 2019, Main Street sold 2,247,187 shares of its common stock at a weighted-average price of $40.05 per share and raised $90.0 million of gross proceeds under the ATM Program. Net proceeds were $88.8 million after commissions to the selling agents on shares sold and offering costs.

NOTE I—DIVIDEND REINVESTMENT PLAN ("DRIP")

        Main Street's DRIP provides for the reinvestment of dividends on behalf of its stockholders, unless a stockholder has elected to receive dividends in cash. As a result, if Main Street declares a cash dividend, its stockholders who have not "opted out" of the DRIP by the dividend record date will have their cash dividend automatically reinvested into additional shares of MSCC common stock. The share requirements of the DRIP may be satisfied through the issuance of shares of common stock or through open market purchases of common stock by the DRIP plan administrator. Newly issued shares will be

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Notes to Consolidated Financial Statements (Continued)

(Unaudited)

valued based upon the final closing price of MSCC's common stock on the valuation date determined for each dividend by Main Street's Board of Directors. Shares purchased in the open market to satisfy the DRIP requirements will be valued based upon the average price of the applicable shares purchased, before any associated brokerage or other costs. Main Street's DRIP is administered by its transfer agent on behalf of Main Street's record holders and participating brokerage firms. Brokerage firms and other financial intermediaries may decide not to participate in Main Street's DRIP but may provide a similar dividend reinvestment plan for their clients.

        For the three months ended March 31, 2020, $3.9 million of the total $39.7 million in dividends paid to stockholders represented DRIP participation. During this period, the DRIP participation requirements were satisfied with the issuance of 108,722 newly issued shares. For the three months ended March 31, 2019, $3.6 million of the total $36.0 million in dividends paid to stockholders represented DRIP participation. During this period, the DRIP participation requirements were satisfied with the issuance of 96,189 newly issued shares. The shares disclosed above relate only to Main Street's DRIP and exclude any activity related to broker-managed dividend reinvestment plans.

NOTE J—SHARE-BASED COMPENSATION

        Main Street accounts for its share-based compensation plans using the fair value method, as prescribed by ASC 718, Compensation—Stock Compensation. Accordingly, for restricted stock awards, Main Street measured the grant date fair value based upon the market price of its common stock on the date of the grant and amortizes the fair value of the awards as share-based compensation expense over the requisite service period, which is generally the vesting term.

        Main Street's Board of Directors approves the issuance of shares of restricted stock to Main Street employees pursuant to the Main Street Capital Corporation 2015 Equity and Incentive Plan (the "Equity and Incentive Plan"). These shares generally vest over a three-year period from the grant date. The fair value is expensed over the service period, starting on the grant date. The following table summarizes the restricted stock issuances approved by Main Street's Board of Directors under the Equity and Incentive Plan, net of shares forfeited, if any, and the remaining shares of restricted stock available for issuance as of March 31, 2020.

Restricted stock authorized under the plan

     3,000,000  

Less net restricted stock granted during:

        

Year ended December 31, 2015

     (900 )

Year ended December 31, 2016

     (260,514 )

Year ended December 31, 2017

     (223,812 )

Year ended December 31, 2018

     (243,779 )

Year ended December 31, 2019

     (384,049 )

Three months ended March 31, 2020

     (8,804 )
​ ​ ​ ​ ​

Restricted stock available for issuance as of March 31, 2020

     1,878,142  
​ ​ ​ ​ ​
​ ​ ​ ​ ​
​ ​ ​ ​ ​

        As of March 31, 2020, the following table summarizes the restricted stock issued to Main Street's non-employee directors and the remaining shares of restricted stock available for issuance pursuant to the Main Street Capital Corporation 2015 Non-Employee Director Restricted Stock Plan. These shares are granted upon appointment or election to the board and vest on the day immediately preceding the

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(Unaudited)

annual meeting of stockholders following the respective grant date and are expensed over such service period.

Restricted stock authorized under the plan

     300,000  

Less net restricted stock granted during:

        

Year ended December 31, 2015

     (6,806 )

Year ended December 31, 2016

     (6,748 )

Year ended December 31, 2017

     (5,948 )

Year ended December 31, 2018

     (6,376 )

Year ended December 31, 2019

     (6,008 )

Three months ended March 31, 2020

     (1,479 )
​ ​ ​ ​ ​

Restricted stock available for issuance as of March 31, 2020

     266,635  
​ ​ ​ ​ ​
​ ​ ​ ​ ​
​ ​ ​ ​ ​

        For the three months ended March 31, 2020 and 2019, Main Street recognized total share-based compensation expense of $2.8 million and $2.3 million, respectively, related to the restricted stock issued to Main Street employees and non-employee directors.

        As of March 31, 2020, there was $13.4 million of total unrecognized compensation expense related to Main Street's non-vested restricted shares. This compensation expense is expected to be recognized over a remaining weighted-average period of approximately 2.0 years as of March 31, 2020.

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Notes to Consolidated Financial Statements (Continued)

(Unaudited)

NOTE K—COMMITMENTS AND CONTINGENCIES

        At March 31, 2020, Main Street had the following outstanding commitments (in thousands):

 
   Amount  

Investments with equity capital commitments that have not yet funded:

        

Congruent Credit Opportunities Funds

    
 		  

Congruent Credit Opportunities Fund II, LP

   $ 8,488  

Congruent Credit Opportunities Fund III, LP

     8,117  
​ ​ ​ ​ ​

  $ 16,605  

Encap Energy Fund Investments

    
 		  

EnCap Energy Capital Fund VIII, L.P. 

   $ 220  

EnCap Energy Capital Fund IX, L.P. 

     308  

EnCap Energy Capital Fund X, L.P. 

     1,597  

EnCap Flatrock Midstream Fund II, L.P. 

     4,728  

EnCap Flatrock Midstream Fund III, L.P. 

     579  
​ ​ ​ ​ ​

  $ 7,432  

EIG Fund Investments

  
$
4,683		  

Freeport Fund Investments

    
 		  

Freeport Financial SBIC Fund LP

   $ 1,375  

Freeport First Lien Loan Fund III LP

     1,555  
​ ​ ​ ​ ​

  $ 2,930  

Brightwood Capital Fund Investments

    
 		  

Brightwood Capital Fund III, LP

   $ 3,000  

Brightwood Capital Fund IV, LP

     500  
​ ​ ​ ​ ​

  $ 3,500  

Harris Preston Fund Investments

    
 		  

HPEP 3, L.P. 

   $ 2,181  

LKCM Headwater Investments I, L.P. 

  
$
2,500		  

Dos Rios Partners

    
 		  

Dos Rios Partners, LP

   $ 1,594  

Dos Rios Partners—A, LP

     506  
​ ​ ​ ​ ​

  $ 2,100  

Access Media Holdings, LLC

  
$
284 		 
​ ​ ​ ​ ​

Total equity commitments

   $ 42,215  
​ ​ ​ ​ ​

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Notes to Consolidated Financial Statements (Continued)

(Unaudited)

 
   Amount  

Investments with commitments to fund revolving loans that have not been fully drawn or term loans with additional commitments not yet funded:

        

SI East, LLC

  
$
7,500		  

Hunter Defense Technologies, Inc. 

     6,460  

Classic H&G Holdco, LLC

     4,000  

Arcus Hunting LLC

     2,939  

Fortna, Inc. 

     2,703  

Echo US Holdings, LLC. 

     2,037  

Boccella Precast Products LLC

     2,000  

PPL RVs, Inc. 

     2,000  

Bluestem Brands, Inc. 

     1,875  

Cody Pools, Inc. 

     1,600  

Chamberlin Holding LLC

     1,600  

Direct Marketing Solutions, Inc. 

     1,600  

Trantech Radiator Topco, LLC

     1,600  

Hawk Ridge Systems, LLC

     1,400  

GS HVAM Intermediate, LLC

     1,364  

GRT Rubber Technologies LLC

     1,340  

Gamber-Johnson Holdings, LLC

     1,200  

LL Management, Inc.(Lab Logistics)

     1,182  

CompareNetworks Topco, LLC

     1,000  

Lynx FBO Operating LLC

     875  

Independent Pet Partners Intermediate Holdings, LLC

     800  

Analytical Systems Keco, LLC

     800  

CTVSH, PLLC

     800  

Mystic Logistics Holdings, LLC

     800  

DTE Enterprises RLOC

     750  

Mac Lean-Fogg Company

     735  

ASC Interests, LLC

     700  

PaySimple, Inc. 

     695  

PT Network, LLC

     658  

Invincible Boat Company, LLC. 

     648  

TEAM Public Choices, LLC

     614  

Wireless Vision Holdings, LLC

     592  

Jensen Jewelers of Idaho, LLC

     500  

NRI Clinical Research, LLC

     500  

Clickbooth.com, LLC

     457  

HDC/HW Intermediate Holdings

     320  

American Nuts, LLC

     281  

Dynamic Communities, LLC

     250  

NinjaTrader, LLC

     200  
​ ​ ​ ​ ​

Total loan commitments

   $ 57,375  
​ ​ ​ ​ ​

Total commitments

   $ 99,590  
​ ​ ​ ​ ​
​ ​ ​ ​ ​
​ ​ ​ ​ ​

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(Unaudited)

        Main Street will fund its unfunded commitments from the same sources it uses to fund its investment commitments that are funded at the time they are made (which are typically through existing cash and cash equivalents and borrowings under the Credit Facility). Main Street follows a process to manage its liquidity and ensure that it has available capital to fund its unfunded commitments as necessary. The Company had total unrealized depreciation of $1.8 million on the outstanding unfunded commitments as of March 31, 2020.

        Effective January 1, 2019, ASC 842 required that a lessee evaluate its leases to determine whether they should be classified as operating or financing leases. Main Street identified one operating lease for its office space. The lease commenced May 15, 2017 and expires January 31, 2028. It contains two five-year extension options for a final expiration date of January 31, 2038.

        As Main Street classified this lease as an operating lease prior to implementation, ASC 842-10-65-1 indicates that a right-of-use asset and lease liability should be recorded based on the effective date. Main Street adopted ASC 842 effective January 1, 2019 and recorded a right-of-use asset and a lease liability as of that date. After this date, Main Street has recorded lease expense on a straight-line basis, consistent with the accounting treatment for lease expense prior to the adoption of ASC 842.

        Total operating lease cost incurred by Main Street for each of the three months ended March 31, 2020 and 2019 was $0.2 million. As of March 31, 2020, the asset related to the operating lease was $4.6 million and is included in the interest receivable and other assets balance on the consolidated balance sheet. The lease liability was $5.4 million and is included in the accounts payable and other liabilities balance on the consolidated balance sheet. As of March 31, 2020, the remaining lease term was 7.8 years and the discount rate was 4.2%.

        The following table shows future minimum payments under Main Street's operating lease as of March 31, 2020 (in thousands):

For the Years Ended December 31,
  Amount  

2020

   $ 572  

2021

     776  

2022

     790  

2023

     804  

2024

     818  

Thereafter

     2,611  
​ ​ ​ ​ ​

Total

   $ 6,371  
​ ​ ​ ​ ​
​ ​ ​ ​ ​
​ ​ ​ ​ ​

        Main Street may, from time to time, be involved in litigation arising out of its operations in the normal course of business or otherwise. Furthermore, third parties may try to impose liability on Main Street in connection with the activities of its portfolio companies. While the outcome of any current legal proceedings cannot at this time be predicted with certainty, Main Street does not expect any current matters will materially affect its financial condition or results of operations; however, there can be no assurance whether any pending legal proceedings will have a material adverse effect on Main Street's financial condition or results of operations in any future reporting period.

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Notes to Consolidated Financial Statements (Continued)

(Unaudited)

NOTE L—RELATED PARTY TRANSACTIONS

        As discussed further in Note D, the External Investment Manager is treated as a wholly owned portfolio company of MSCC and is included as part of Main Street's Investment Portfolio. At March 31, 2020, Main Street had a receivable of approximately $2.5 million due from the External Investment Manager, which included (i) approximately $1.9 million related primarily to operating expenses incurred by MSCC or its subsidiaries as required to support the External Investment Manager's business and amounts due from the External Investment Manager to Main Street under a tax sharing agreement (see further discussion in Note D) and (ii) approximately $0.7 million of dividends declared but not paid by the External Investment Manager.

        In November 2015, Main Street's Board of Directors approved and adopted the Main Street Capital Corporation Deferred Compensation Plan (the "2015 Deferred Compensation Plan"). The 2015 Deferred Compensation Plan became effective on January 1, 2016 and replaced the Deferred Compensation Plan for Non-Employee Directors previously adopted by the Board of Directors in June 2013 (the "2013 Deferred Compensation Plan"). Under the 2015 Deferred Compensation Plan, non-employee directors and certain key employees may defer receipt of some or all of their cash compensation and directors' fees, subject to certain limitations. Individuals participating in the 2015 Deferred Compensation Plan receive distributions of their respective balances based on predetermined payout schedules or other events as defined by the plan and are also able to direct investments made on their behalf among investment alternatives permitted from time to time under the plan, including phantom Main Street stock units. As of March 31, 2020, $8.9 million of compensation and directors' fees had been deferred under the 2015 Deferred Compensation Plan (including amounts previously deferred under the 2013 Deferred Compensation Plan). Of this amount, $4.2 million was deferred into phantom Main Street stock units, representing 120,101 shares of Main Street's common stock. Including phantom stock units issued through dividend reinvestment and net of any shares distributed, the phantom stock units outstanding as of March 31, 2020 represented 154,334 shares of Main Street's common stock. Any amounts deferred under the plan represented by phantom Main Street stock units will not be issued or included as outstanding on the consolidated statements of changes in net assets until such shares are actually distributed to the participant in accordance with the plan, but the related phantom stock units are included in weighted-average shares outstanding with the related dollar amount of the deferral included in total expenses in Main Street's consolidated statements of operations as earned. The dividend amounts related to additional phantom stock units are included in the statements of changes in net assets as an increase to dividends to stockholders offset by a corresponding increase to additional paid-in capital.

NOTE M—SUBSEQUENT EVENTS

        During May 2020, Main Street declared regular monthly dividends of $0.205 per share for each month of July, August and September of 2020. These regular monthly dividends equal a total of $0.615 per share for the third quarter of 2020, unchanged from the regular monthly dividends paid in the third quarter of 2019. Including the regular monthly dividends declared for the second and third quarters of 2020, Main Street will have paid $28.985 per share in cumulative dividends since its October 2007 initial public offering.

        In April 2020, Main Street led a new portfolio investment to facilitate the recapitalization of Pearl Meyer & Partners ("Pearl Meyer"), an independent provider of executive compensation consulting services, benchmarking data and surveys. Main Street partnered with Pearl Meyer's senior management

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MAIN STREET CAPITAL CORPORATION

Notes to Consolidated Financial Statements (Continued)

(Unaudited)

team to facilitate the recapitalization and provide additional capital to the business as it executes on its consolidation strategy in the fragmented executive compensation advisory segment. Main Street invested $48.8 million in the recapitalization, consisting of a $35.0 million term loan and a $13.8 million preferred equity investment.

        Main Street continues to work collectively with its employees and portfolio companies to navigate the significant challenges created by the ongoing COVID-19 pandemic beginning in the first quarter of 2020. Main Street's business and operating results, and the businesses and operating results of Main Street's portfolio companies, have been significantly impacted by COVID-19. Due to the challenges and uncertainty created by COVID-19, Main Street suspended its future semi-annual supplemental dividends, specifically including the supplemental dividend that it previously expected to pay in June 2020. Main Street believes that it is in the best long-term interests of its stockholders to not only maintain a conservative approach to its dividend policy during this volatile economic environment, but to also ensure it has the ability to be opportunistic in funding attractive investments that have the potential to provide long-term value to Main Street's stockholders.

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Schedule 12-14

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments In and Advances to Affiliates
March 31, 2020
(dollars in thousands)
(unaudited)

Company
  Investment(1)(10)(11)   Geography   Amount
of
Realized
Gain/
(Loss) 		  Amount
of
Unrealized
Gain/
(Loss) 		  Amount
of
Interest,
Fees or
Dividends
Credited
to
Income(2) 		  December 31,
2019
Fair Value 		  Gross
Additions(3) 		  Gross
Reductions(4) 		  March 31,
2020
Fair
Value 		 

Majority-owned investments

                                                    

Café Brazil, LLC

  

Member Units

  

(8)

  
$
—		  
$
(260
)
$
38		  
$
2,440		  
$
—		  
$
260		  
$
2,180 		 
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

California Splendor Holdings LLC

   LIBOR Plus 8.00% (Floor 1.00%)   (9)     —     103     143     7,104     112     5,800     1,416  

  LIBOR Plus 10.00% (Floor 1.00%)   (9)     —     (65 )   862     27,801     13     65     27,749  

  Preferred Member Units   (9)     —     —     271     7,163     271     —     7,434  

  Preferred Member Units   (9)     —     (1,601 )   63     7,382     —     1,601     5,781  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Clad-Rex Steel, LLC

   LIBOR Plus 9.50% (Floor 1.00%)   (5)     —     92     304     10,781     99     —     10,880  

  Member Units   (5)     —     (1,020 )   72     9,630     —     1,020     8,610  

  10% Secured Debt   (5)     —     —     28     1,137     —     6     1,131  

  Member Units   (5)     —     —     —     460     —     —     460  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

CMS Minerals Investments

   Member Units   (9)     —     (392 )   —     1,900     —     445     1,455  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Cody Pools, Inc.

   LIBOR Plus 10.50% (Floor 1.75%)   (8)     —     —     323     —     15,842     —     15,842  

  Preferred Member Units   (8)     —     —     —     —     8,317     —     8,317  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

CompareNetworks Topco, LLC

   LIBOR Plus 11.00% (Floor 1.00%)   (9)     —     —     269     8,288     7     350     7,945  

  Preferred Member Units   (9)     —     420     —     3,010     420     —     3,430  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Direct Marketing Solutions, Inc.

   LIBOR Plus 11.00% (Floor 1.00%)   (9)     —     —     513     15,707     19     244     15,482  

  Preferred Stock   (9)     —     (140 )   —     20,200     —     140     20,060  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Gamber-Johnson Holdings, LLC

   LIBOR Plus 6.50% (Floor 2.00%)   (5)     —     (14 )   410     19,022     14     798     18,238  

  Member Units   (5)     —     (170 )   2,057     53,410     —     170     53,240  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

GRT Rubber Technologies LLC

   LIBOR Plus 7.00%   (8)     —     —     363     15,016     1,759     —     16,775  

  Member Units   (8)     —     (2,020 )   695     47,450     —     2,020     45,430  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Guerdon Modular Holdings, Inc.

   16.00% Secured Debt   (9)     (12,776 )   12,587     —     —     —     —     —  

  LIBOR Plus 8.50% (Floor 1.00%)   (9)     (993 )   1,010     —     —     —     —     —  

  Preferred Stock   (9)     —     —     —     —     —     —     —  

  Common Stock   (9)     130     —     —     —     —     —     —  

  Warrants   (9)     —     —     —     —     —     —     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Harborside Holdings, LLC

   Member Units   (8)     —     —     —     9,560     —     —     9,560  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

IDX Broker, LLC

   11.00% Secured Debt   (9)     —     (13 )   380     13,400     13     813     12,600  

  Preferred Member Units   (9)     —     2,860     69     15,040     2,860     —     17,900  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Jensen Jewelers of Idaho, LLC

   Prime Plus 6.75% (Floor 2.00%)   (9)     —     (56 )   125     4,000     4     156     3,848  

  Member Units   (9)     —     (470 )   —     8,270     —     470     7,800  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Kickhaefer Manufacturing Company, LLC

   11.50% Secured Debt   (5)     —     —     742     24,982     574     400     25,156  

  Member Units   (5)     —     (790 )   —     12,240     —     790     11,450  

  9.00% Secured Debt   (5)     —     —     90     3,939     —     7     3,932  

  Member Units   (5)     —     —     22     1,160     —     —     1,160  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Market Force Information, LLC

   8% PIK Secured Debt   (9)     —     (373 )   37     2,695     —     373     2,322  

  12.00% PIK Secured Debt   (9)     —     (5,110 )   242     22,621     8     5,110     17,519  

  Member Units   (9)     —     (5,280 )   —     5,280     —     5,280     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

MH Corbin Holding LLC

   13.00% Secured Debt   (5)     —     (76 )   297     8,890     8     156     8,742  

  Preferred Member Units   (5)     —     (20 )   —     20     —     20     —  

  Preferred Member Units   (5)     —     (400 )   —     4,770     —     400     4,370  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Mid-Columbia Lumber Products, LLC

   10.00% Secured Debt   (9)     —     148     44     1,602     148     1,750     —  

  12.00% Secured Debt   (9)     —     256     119     3,644     256     3,900     —  

  Member Units   (9)     —     (1,000 )   1     —     1,000     1,000     —  

  9.50% Secured Debt   (9)     —     —     16     701     —     12     689  

  Member Units   (9)     —     —     20     1,640     —     —     1,640  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

MSC Adviser I, LLC

   Member Units   (8)     —     (12,940 )   660     74,520     —     12,940     61,580  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Mystic Logistics Holdings, LLC

   12.00% Secured Debt   (6)     —     —     213     6,253     983     279     6,957  

  Common Stock   (6)     —     1,780     —     8,410     1,780     —     10,190  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

OMi Holdings, Inc.

   Common Stock   (8)     —     1,080     543     16,950     1,080     —     18,030  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

PPL RVs, Inc.

   LIBOR Plus 8.75% PIK (Floor 0.50%)   (8)     —     —     339     12,118     123     250     11,991  

  Common Stock   (8)     —     690     —     9,930     690     —     10,620  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Principle Environmental, LLC (d/b.a

   13.00% Secured Debt   (8)     —     (13 )   224     6,397     13     13     6,397  

TruHorizon Environmental Solutions)

   Preferred Member Units   (8)     —     350     —     13,390     350     —     13,740  

  Warrants   (8)     —     50     —     1,090     50     —     1,140  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Quality Lease Service, LLC

   Member Units   (7)     —     (3,340 )   —     9,289     300     3,340     6,249  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

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Table of Contents

Company
  Investment(1)(10)(11)   Geography   Amount
of
Realized
Gain/
(Loss) 		  Amount
of
Unrealized
Gain/
(Loss) 		  Amount
of
Interest,
Fees or
Dividends
Credited
to
Income(2) 		  December 31,
2019
Fair Value 		  Gross
Additions(3) 		  Gross
Reductions(4) 		  March 31,
2020
Fair
Value 		 

Trantech Radiator Topco, LLC

   12% Secured Debt   (7)     —     —     282     9,102     7     320     8,789  

  Common Stock   (7)     —     1,964     29     4,655     1,964     —     6,619  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Vision Interests, Inc.

   13.00% Secured Debt   (9)     —     —     67     2,028     —     —     2,028  

  Series A Preferred Stock   (9)     —     (630 )   —     4,089     —     630     3,459  

  Common Stock   (9)     —     (239 )   —     409     —     239     170  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Ziegler's NYPD, LLC

   6.50% Secured Debt   (8)     —     (101 )   16     1,000     5     101     904  

  12.00% Secured Debt   (8)     —     —     19     625     6     —     631  

  14.00% Secured Debt   (8)     —     (279 )   97     2,750     33     279     2,504  

  Warrants   (8)     —     —     —     —     —     —     —  

  Preferred Member Units   (8)     —     (130 )   —     1,269     —     130     1,139  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Other controlled investments

                                                    

Access Media Holdings, LLC

  

10.00% PIK Secured Debt

  

(5)

    
—		    
(1,962
)		  
13		    
6,387		    
—		    
1,962		    
4,425		  

  Preferred Member Units   (5)     —     —     —     (284 )   —     —     (284 )

  Member Units   (5)     —     —     —     —     —     —     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Analytical Systems Keco, LLC

   LIBOR Plus 10.00% (Floor 2.00%)   (8)     —     —     186     5,210     18     70     5,158  

  Preferred Member Units   (8)     —     860     —     3,200     860     —     4,060  

  Warrants   (8)     —     224     —     316     224     —     540  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

ASC Interests, LLC

   12.50% Secured Debt   (8)     —     —     58     1,639     —     37     1,602  

  Member Units   (8)     —     (240 )   —     1,290     —     240     1,050  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

ATS Workholding, LLC

   5.00% Secured Debt   (9)     —     (619 )   92     4,521     31     619     3,933  

  Preferred Member Units   (9)     —     (939 )   —     939     —     939     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Bond-Coat, Inc.

   15% Secured Debt   (8)     —     —     1,399     11,473     123     11,596     —  

  Common Stock   (8)     —     (1,280 )   —     8,300     —     1,280     7,020  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Brewer Crane Holdings, LLC

   LIBOR Plus 10.00% (Floor 1.00%)   (9)     —     —     268     8,989     5     124     8,870  

  Preferred Member Units   (9)     —     —     20     4,280     —     —     4,280  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Bridge Capital Solutions Corporation

   13.00% Secured Debt   (6)     —     —     431     7,797     141     —     7,938  

  Warrants   (6)     —     (180 )   —     3,500     —     180     3,320  

  13.00% Secured Debt   (6)     —     —     33     996     1     —     997  

  Preferred Member Units   (6)     —     —     25     1,000     —     —     1,000  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

CBT Nuggets, LLC

   Member Units   (9)     —     (3,230 )   —     50,850     —     3,230     47,620  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Centre Technologies Holdings, LLC

   LIBOR Plus 10.00% (Floor 2.00%)   (8)     —     —     372     12,136     7     153     11,990  

  Preferred Member Units   (8)     —     —     30     5,840     —     —     5,840  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Chamberlin Holding LLC

   LIBOR Plus 10.00% (Floor 1.00%)   (8)     —     (8 )   542     17,773     8     8     17,773  

  Member Units   (8)     —     110     243     24,040     110     —     24,150  

  Member Units   (8)     —     (530 )   17     1,450     —     530     920  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Charps, LLC

   15.00% Secured Debt   (5)     —     —     76     2,000     —     —     2,000  

  Preferred Member Units   (5)     —     640     23     6,920     640     —     7,560  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Copper Trail Fund Investments

   LP Interests (CTMH, LP)   (9)     —     —     —     872     —     80     792  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Datacom, LLC

   8.00% Secured Debt   (8)     —     —     —     1,615     —     —     1,615  

  10.50% PIK Secured Debt   (8)     —     —     —     10,142     —     —     10,142  

  Class A Preferred Member Units   (8)     —     —     —     —     —     —     —  

  Class B Preferred Member Units   (8)     —     —     —     —     —     —     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Digital Products Holdings LLC

   LIBOR Plus 10.00% (Floor 1.00%)   (5)     —     (338 )   584     18,452     11     668     17,795  

  Preferred Member Units   (5)     —     (2,796 )   50     5,174     —     2,796     2,378  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Garreco, LLC

   LIBOR Plus 8.00% (Floor 1.00%, Ceiling 1.50%)   (8)     —     —     112     4,515     3     —     4,518  

  Member Units   (8)     —     (480 )   —     2,560     —     480     2,080  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Gulf Manufacturing, LLC

   Member Units   (8)     —     (2,180 )   119     7,430     —     2,180     5,250  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Gulf Publishing Holdings, LLC

   LIBOR Plus 9.50% (Floor 1.00%)   (8)     —     —     7     280     —     40     240  

  12.50% Secured Debt   (8)     —     (139 )   404     12,493     7     139     12,361  

  Member Units   (8)     —     (2,420 )   —     2,420     —     2,420     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Harris Preston Fund Investments

   LP Interests (2717 MH, L.P.)   (8)     —     —     —     3,157     —     —     3,157  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Harrison Hydra-Gen, Ltd.

   Common Stock   (8)     —     (1,610 )   104     7,970     —     1,610     6,360  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

J&J Services, Inc.

   11.50% Secured Debt   (7)     —     —     518     17,430     7     —     17,437  

  Preferred Stock   (7)     —     —     —     7,160     —     —     7,160  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

KBK Industries, LLC

   Member Units   (5)     —     (440 )   212     15,470     —     440     15,030  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

NAPCO Precast, LLC

   Member Units   (8)     —     (2,850 )   2     14,760     —     2,850     11,910  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

NexRev LLC

   11.00% PIK Secured Debt   (8)     —     (1,701 )   397     17,469     174     1,919     15,724  

  Preferred Member Units   (8)     —     (6,310 )   —     6,310     —     6,310     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

NRI Clinical Research, LLC

   9.00% Secured Debt   (9)     —     (8 )   201     5,981     1,527     8     7,500  

  Warrants   (9)     —     160     —     1,230     160     —     1,390  

  Member Units   (9)     —     333     377     4,988     710     377     5,321  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

NRP Jones, LLC

   12.00% Secured Debt   (5)     —     —     193     6,376     —     —     6,376  

  Member Units   (5)     —     (1,220 )   25     4,710     —     1,220     3,490  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

NuStep, LLC

   12.00% Secured Debt   (5)     —     —     610     19,703     11     160     19,554  

  Preferred Member Units   (5)     —     —     —     10,200     —     —     10,200  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Pegasus Research Group, LLC

   Member Units   (8)     —     1,790     —     8,170     1,790     —     9,960  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

99

Table of Contents

Company
  Investment(1)(10)(11)   Geography   Amount
of
Realized
Gain/
(Loss) 		  Amount
of
Unrealized
Gain/
(Loss) 		  Amount
of
Interest,
Fees or
Dividends
Credited
to
Income(2) 		  December 31,
2019
Fair Value 		  Gross
Additions(3) 		  Gross
Reductions(4) 		  March 31,
2020
Fair
Value 		 

River Aggregates, LLC

   Zero Coupon Secured Debt   (8)     —     —     —     722     —     —     722  

  Member Units   (8)     —     1,170     93     4,990     1,170     —     6,160  

  Member Units   (8)     —     80     —     3,169     80     —     3,249  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Tedder Industries, LLC

   12.00% Secured Debt   (9)     —     —     21     640     —     —     640  

  12.00% Secured Debt   (9)     —     —     504     16,272     7     —     16,279  

  Preferred Member Units   (9)     —     —     —     8,136     —     —     8,136  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Other

                                                    

Amounts related to investments transferred to or from other 1940 Act classification during the period

             (7,833 )   —     8     4,564     —     —     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Total Control investments

           $ (21,472 ) $ (39,665 ) $ 19,473   $ 1,032,721   $ 46,953   $ 96,742   $ 978,368  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Affiliate Investments

                                                    

                                                   

AFG Capital Group, LLC

  

10.00% Secured Debt

  

(8)

  
$
—		  
$
—		  
$
20		  
$
838		  
$
—		  
$
87		  
$
751		  

  Preferred Member Units   (8)     —     (120 )   —     5,180     —     120     5,060  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

American Trailer Rental Group LLC

   LIBOR Plus 7.25% (Floor 1.00%)   (5)     —     (182 )   1,119     27,087     182     27,269     —  

  Member Units   (5)     —     669     —     8,540     4,410     —     12,950  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

BBB Tank Services, LLC

   LIBOR Plus 11.00% (Floor 1.00%)   (8)     —     (51 )   171     4,698     18     51     4,665  

  Preferred Member Units   (8)     —     —     5     131     5     —     136  

  Member Units   (8)     —     (80 )   —     290     —     80     210  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Boccella Precast Products LLC

   LIBOR Plus 10% (Floor 1.00%)   (6)     —     (15 )   434     13,244     15     379     12,880  

  Member Units   (6)     —     (610 )   77     6,270     —     610     5,660  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Buca C, LLC

   LIBOR Plus 9.25% (Floor 1.00%)   (7)     —     (1,821 )   532     18,794     11     1,821     16,984  

  Preferred Member Units   (7)     —     (4,005 )   69     4,701     69     4,005     765  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

CAI Software LLC

   11.00% Secured Debt   (6)     —     (4 )   259     9,160     4     20     9,144  

  Member Units   (6)     —     60     10     5,210     60     —     5,270  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Chandler Signs Holdings, LLC

   Class A Units   (8)     —     (200 )   (91 )   2,740     —     200     2,540  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Charlotte Russe, Inc

   Common Stock   (9)     —     —     —     —     —     —     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Classic H&G Holdings, LLC

   12% Secured Debt   (6)     —     —     717     —     25,743     —     25,743  

  Preferred Member Units   (6)     —     —     —     —     5,760     —     5,760  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Congruent Credit Opportunities Funds

   LP Interests (Fund II)   (8)     —     —     —     855     —     —     855  

  LP Interests (Fund III)   (8)     —     (1,329 )   277     13,915     —     2,341     11,574  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Copper Trail Fund Investments

   LP Interests (Copper Trail Energy Fund I, LP)   (9)     —     —     164     2,362     —     —     2,362  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Dos Rios Partners

   LP Interests (Dos Rios Partners, LP)   (8)     —     (185 )   —     7,033     —     185     6,848  

  LP Interests (Dos Rios Partners—A, LP)   (8)     —     (59 )   —     2,233     —     59     2,174  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

East Teak Fine Hardwoods, Inc.

   Common Stock   (7)     —     (100 )   4     400     —     100     300  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

EIG Fund Investments

   LP Interests (EIG Global Private Debt fund—A, L.P.)   (8)     6     (113 )   34     720     61     219     562  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Freeport Financial Funds

   LP Interests (Freeport Financial SBIC Fund LP)   (5)     —     (739 )   —     5,778     —     739     5,039  

  LP Interests (Freeport First Lien Loan Fund III LP)   (5)     —     (1,052 )   255     9,696     989     1,052     9,633  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Fuse, LLC

   12% Secured Debt   (9)     —     —     59     1,939     —     —     1,939  

  Common Stock   (9)     —     —     —     256     —     —     256  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Harris Preston Fund Investments

   LP Interests (HPEP 3, L.P.)   (8)     —     —     —     2,474     345     —     2,819  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Hawk Ridge Systems, LLC

   LIBOR Plus 6.00% (Floor 1.00%)   (9)     —     —     13     600     —     —     600  

  11.00% Secured Debt   (9)     —     (7 )   380     13,400     7     7     13,400  

  Preferred Member Units   (9)     —     (580 )   —     7,900     —     580     7,320  

  Preferred Member Units   (9)     —     (30 )   —     420     —     30     390  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Houston Plating and Coatings, LLC

   8.00% Unsecured Convertible Debt   (8)     —     (570 )   61     4,260     —     570     3,690  

  Member Units   (8)     —     (1,490 )   65     10,330     —     1,490     8,840  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

I-45 SLF LLC

   Member Units   (8)     —     (4,656 )   685     14,407     —     4,656     9,751  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

L.F. Manufacturing Holdings, LLC

   Preferred Member Units   (8)     —     —     3     81     3     —     84  

  Member Units   (8)     —     —     —     2,050     —     —     2,050  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

OnAsset Intelligence, Inc.

   12.00% PIK Secured Debt   (8)     —     —     197     6,474     197     —     6,671  

  10.00% PIK Secured Debt   (8)     —     —     2     58     2     —     60  

  Preferred Stock   (8)     —     —     —     —     —     —     —  

  Warrants   (8)     —     —     —     —     —     —     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

PCI Holding Company, Inc.

   12% Current Secured Debt   (9)     —     —     344     11,356     —     —     11,356  

  Preferred Stock   (9)     —     1,260     —     2,680     1,260     —     3,940  

  Preferred Stock   (9)     —     —     —     4,350     —     —     4,350  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Rocaceia, LLC (Quality Lease and Rental

   12.00% Secured Debt   (8)     —     —     —     —     241     241     —  

Holdings, LLC)

   Preferred Member Units   (8)     —     —     —     —     —     —     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Salado Stone Holdings, LLC

   Class A Preferred Units   (8)     —     (140 )   —     570     —     140     430  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

100

Table of Contents

Company
  Investment(1)(10)(11)   Geography   Amount
of
Realized
Gain/
(Loss) 		  Amount
of
Unrealized
Gain/
(Loss) 		  Amount
of
Interest,
Fees or
Dividends
Credited
to
Income(2) 		  December 31,
2019
Fair Value 		  Gross
Additions(3) 		  Gross
Reductions(4) 		  March 31,
2020
Fair
Value 		 

SI East, LLC

   9.50% Current, Secured Debt   (7)     —     (18 )   816     32,963     18     18     32,963  

  Preferred Member Units   (7)     —     450     356     8,200     450     —     8,650  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Slick Innovations, LLC

   14.00% Current, Secured Debt   (6)     —     —     233     6,197     9     —     6,206  

  Warrants   (6)     —     —     —     290     —     —     290  

  Common Stock   (6)     —     —     —     1,080     —     —     1,080  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

UniTek Global Services, Inc.

   LIBOR Plus 6.50% (Floor 1.00%)   (6)     —     (283 )   64     2,962     17     292     2,687  

  Preferred Stock   (6)     —     (2,680 )   —     2,684     —     2,680     4  

  Preferred Stock   (6)     —     (106 )   106     2,282     106     106     2,282  

  Preferred Stock   (6)     —     511     56     1,889     944     —     2,833  

  Preferred Stock   (6)     —     (1,250 )   —     3,667     —     1,250     2,417  

  Common Stock   (6)     —     —     —     —     —     —     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Universal Wellhead Services Holdings, LLC

   Preferred Member Units   (8)     —     (260 )   —     800     —     260     540  

  Member Units   (8)     —     —     —     —     —     —     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Volusion, LLC

   11.50% Secured Debt   (8)     —     (181 )   660     19,352     72     181     19,243  

  8.00% Unsecured Convertible Debt   (8)     —     —     8     291     —     —     291  

  Preferred Member Units   (8)     —     (1,050 )   —     14,000     —     1,050     12,950  

  Warrants   (8)     —     (150 )   —     150     —     150     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Other

                                                    

Amounts related to investments transferred to or from other 1940 Act classification during the period

             (241 )   —     —     —     —     —     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Total Affiliate investments

           $ (235 ) $ (21,166 ) $ 8,164   $ 330,287   $ 40,998   $ 53,038   $ 318,247  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
(1)
The principal amount, the ownership detail for equity investments and if the investment is income producing is included in the consolidated schedule of investments.

(2)
Represents the total amount of interest, fees and dividends credited to income for the portion of the period for which an investment was included in Control or Affiliate categories, respectively.For investments transferred between Control and Affiliate categories during the period, any income or investment balances related to the time period it was in the category other than the one shown at period end is included in "Amounts from investments transferred from other 1940 Act classifications during the period."

(3)
Gross additions include increases in the cost basis of investments resulting from new portfolio investments, follow-on investments and accrued PIK interest, and the exchange of one or more existing securities for one or more new securities. Gross additions also include net increases in unrealized appreciation or net decreases in net unrealized depreciation as well as the movement of an existing portfolio company into this category and out of a different category.

(4)
Gross reductions include decreases in the cost basis of investments resulting from principal repayments or sales and the exchange of one or more existing securities for one or more new securities. Gross reductions also include net increases in net unrealized depreciation or net decreases in unrealized appreciation as well as the movement of an existing portfolio company out of this category and into a different category.

(5)
Portfolio company located in the Midwest region as determined by location of the corporate headquarters. The fair value as of March 31, 2020 for control investments located in this region was $235,893. This represented 17.7% of net assets as of March 31, 2020. The fair value as of March 31, 2020 for affiliate investments located in this region was $27,622. This represented 2.1% of net assets as of March 31, 2020.

(6)
Portfolio company located in the Northeast region as determined by location of the corporate headquarters. The fair value as of March 31, 2020 for control investments located in this region was $30,402. This represented 2.3% of net assets as of March 31, 2020. The fair value as of March 31, 2020 for affiliate investments located in this region was $82,256. This represented 6.2% of net assets as of March 31, 2020.

(7)
Portfolio company located in the Southeast region as determined by location of the corporate headquarters. The fair value as of March 31, 2020 for control investments located in this region was $46,254. This represented 3.5% of net assets as of March 31, 2020. The fair value as of

101

Table of Contents

    March 31, 2020 for affiliate investments located in this region was $59,662. This represented 4.5% of net assets as of March 31, 2020.

(8)
Portfolio company located in the Southwest region as determined by location of the corporate headquarters. The fair value as of March 31, 2020 for control investments located in this region was $400,331. This represented 30.0% of net assets as of March 31, 2020. The fair value as of March 31, 2020 for affiliate investments located in this region was $102,784. This represented 7.7% of net assets as of March 31, 2020.

(9)
Portfolio company located in the West region as determined by location of the corporate headquarters. The fair value as of March 31, 2020 for control investments located in this region was $265,488. This represented 19.9% of net assets as of March 31, 2020. The fair value as of March 31, 2020 for affiliate investments located in this region was $45,913. This represented 3.4% of net assets as of March 31, 2020.

(10)
All of the Company's portfolio investments are generally subject to restrictions on resale as "restricted securities," unless otherwise noted.

(11)
This schedule should be read in conjunction with the consolidated schedule of investments and notes to the consolidated financial statements. Supplemental information can be located within the schedule of investments including end of period interest rate, preferred dividend rate, maturity date, investments not paid currently in cash and investments whose value was determined using significant unobservable inputs.

(12)
Investment has an unfunded commitment as of December 31, 2019 (see Note K). The fair value of the investment includes the impact of the fair value of any unfunded commitments.

102

Table of Contents


 Schedule 12-14

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments in and Advances to Affiliates
March 31, 2019
(dollars in thousands)
(unaudited)

Company
  Investment(1)(10)(11)   Geography   Amount
of
Realized
Gain/
(Loss) 		  Amount
of
Unrealized
Gain/
(Loss) 		  Amount
of
Interest,
Fees or
Dividends
Credited
to
Income(2) 		  December 31,
2018
Fair Value 		  Gross
Additions(3) 		  Gross
Reductions(4) 		  March 31,
2019
Fair
Value 		 

Majority-owned investments

                                                    

Café Brazil, LLC

  

Member Units

  

(8)

  
$
—		  
$
(600
)
$
66		  
$
4,780		  
$
—		  
$
600		  
$
4,180 		 
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

California Splendor Holdings LLC

   LIBOR Plus 8.00% (Floor 1.00%)   (9)     —     —     258     10,928     9     3,000     7,937  

  LIBOR Plus 10.00% (Floor 1.00%)   (9)     —     —     912     27,755     11     —     27,766  

  Preferred Member Units   (9)     —     (2,363 )   63     9,745     —     2,363     7,382  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Clad-Rex Steel, LLC

   LIBOR Plus 9.00% (Floor 1.00%)   (5)     —     (6 )   353     12,080     6     6     12,080  

  Member Units   (5)     —     —     50     10,610     —     —     10,610  

  10% Secured Debt   (5)     —     —     29     1,161     —     5     1,156  

  Member Units   (5)     —     —     —     350     —     —     350  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

CMS Minerals Investments

   Member Units   (9)     —     —     30     2,580     —     126     2,454  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

CompareNetworks Topco, LLC

   LIBOR Plus 11.00% (Floor 1.00%)   (9)     —     —     22     —     241     —     241  

  LIBOR Plus 11.00% (Floor 1.00%)   (9)     —     —     339     —     8,666     —     8,666  

  Preferred Member Units   (9)     —     —     1     —     1,975     —     1,975  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Direct Marketing Solutions, Inc.

   LIBOR Plus 11.00% (Floor 1.00%)   (9)     —     —     618     17,848     9     235     17,622  

  Preferred Stock   (9)     —     1,250     —     14,900     1,250     —     16,150  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Gamber-Johnson Holdings, LLC

   LIBOR Plus 7.50% (Floor 2.00%)   (5)     —     (17 )   545     21,486     17     881     20,622  

  Member Units   (5)     —     —     855     45,460     —     —     45,460  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

GRT Rubber Technologies LLC

   LIBOR Plus 7.00%   (8)     —     (5 )   255     9,740     1,763     5     11,498  

  Member Units   (8)     —     2,230     2,686     39,060     2,230     —     41,290  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Guerdon Modular Holdings, Inc.

   13% Secured Debt   (9)     —     —     425     12,002     16     —     12,018  

  Preferred Stock   (9)     —     —     —     —     —     —     —  

  Common Stock   (9)     —     —     —     —     —     —     —  

  Warrants   (9)     —     —     —     —     —     —     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Harborside Holdings, LLC

   Member Units   (8)     —     (70 )   —     9,500     100     70     9,530  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

IDX Broker, LLC

   11.5% Secured Debt   (9)     —     (11 )   421     14,350     11     161     14,200  

  Preferred Member Units   (9)     —     900     138     13,520     900     —     14,420  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Jensen Jewelers of Idaho, LLC

   Prime Plus 6.75% (Floor 2.00%)   (9)     —     (5 )   105     3,355     5     155     3,205  

  Member Units   (9)     —     290     70     5,090     290     —     5,380  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Kickhaefer Manufacturing Company, LLC

   11.5% Secured Debt   (5)     —     —     822     28,775     12     1,064     27,723  

  Member Units   (5)     —     —     —     12,240     —     —     12,240  

  9.0% Secured Debt   (5)     —     —     88     3,970     —     11     3,959  

  Member Units   (5)     —     —     51     992     —     —     992  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Lamb Ventures, LLC

   LIBOR Plus 5.75%   (8)     —     (1 )   5     —     401     201     200  

  11% Secured Debt   (8)     —     (2 )   249     8,339     3,502     2     11,839  

  Preferred Equity   (8)     —     —     —     400     —     —     400  

  Member Units   (8)     —     3,720     —     7,440     4,110     —     11,550  

  9.5% Secured Debt   (8)     —     —     10     432     —     —     432  

  Member Units   (8)     —     —     63     630     —     —     630  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Market Force Information, LLC

   LIBOR Plus 7.00% (Floor 1.00%)   (9)     —     —     4     200     560     200     560  

  LIBOR Plus 11.00% (Floor 1.00%)   (9)     —     —     792     22,624     10     —     22,634  

  Member Units   (9)     —     (1,910 )   —     13,100     —     1,910     11,190  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

MH Corbin Holding LLC

   5% Current / 5% PIK Secured Debt   (5)     —     484     759     11,733     1,224     4,400     8,557  

  Preferred Member Units   (5)     —     (980 )   —     1,000     —     980     20  

  Preferred Member Units   (5)     —     370     —     —     4,770     —     4,770  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Mid-Columbia Lumber Products, LLC

   10% Secured Debt   (9)     —     —     45     1,746     1     —     1,747  

  12% Secured Debt   (9)     —     —     121     3,880     4     —     3,884  

  Member Units   (9)     —     (1,090 )   2     3,860     —     1,090     2,770  

  9.5% Secured Debt   (9)     —     —     18     746     —     12     734  

  Member Units   (9)     —     —     19     1,470     —     —     1,470  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

MSC Adviser I, LLC

   Member Units   (8)     —     72     1,019     65,748     72     —     65,820  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Mystic Logistics Holdings, LLC

   12% Secured Debt   (6)     —     —     237     7,506     12     30     7,488  

  Common Stock   (6)     —     500     —     210     500     —     710  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

PPL RVs, Inc.

   LIBOR Plus 7.00% (Floor 0.50%)   (8)     —     (94 )   377     15,100     7     94     15,013  

  Common Stock   (8)     —     (1,330 )   —     10,380     —     1,330     9,050  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Principle Environmental, LLC

   13% Secured Debt   (8)     —     (24 )   261     7,477     24     1,104     6,397  

(d/b.a TruHorizon Environmental Solutions)

   Preferred Member Units   (8)     —     2,630     866     13,090     2,630     —     15,720  

  Warrants   (8)     —     170     —     780     170     —     950  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

103

Table of Contents

Company
  Investment(1)(10)(11)   Geography   Amount
of
Realized
Gain/
(Loss) 		  Amount
of
Unrealized
Gain/
(Loss) 		  Amount
of
Interest,
Fees or
Dividends
Credited
to
Income(2) 		  December 31,
2018
Fair Value 		  Gross
Additions(3) 		  Gross
Reductions(4) 		  March 31,
2019
Fair
Value 		 

Quality Lease Service, LLC

   Zero Coupon Secured Debt   (7)     —     —     —     6,450     —     —     6,450  

  Member Units   (7)     —     —     —     3,809     171     —     3,980  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

The MPI Group, LLC

   9% Secured Debt   (7)     —     103     66     2,582     103     —     2,685  

  Series A Preferred Units   (7)     —     (110 )   —     440     —     110     330  

  Warrants   (7)     —     —     —     —     —     —     —  

  Member Units   (7)     —     —     16     2,479     1     —     2,480  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Vision Interests, Inc.

   13% Secured Debt   (9)     —     —     70     2,153     —     125     2,028  

  Series A Preferred Stock   (9)     —     —     —     3,740     —     —     3,740  

  Common Stock   (9)     —     —     —     280     —     1     279  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Ziegler's NYPD, LLC

   6.5% Secured Debt   (8)     —     (1 )   17     1,000     1     1     1,000  

  12% Secured Debt   (8)     —     —     13     425     —     —     425  

  14% Secured Debt   (8)     —     —     96     2,750     —     —     2,750  

  Warrants   (8)     —     —     —     —     —     —     —  

  Preferred Member Units   (8)     —     (240 )   —     1,249     —     240     1,009  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Other controlled investments

                                                    

Access Media Holdings, LLC

  

10% PIK Secured Debt

  

(5)

    
—		    
(955
)		  
13		    
8,558		    
—		    
955		    
7,603		  

  Preferred Member Units (12)   (5)     —     —     —     (284 )   —     —     (284 )

  Member Units   (5)     —     —     —     —     —     —     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

ASC Interests, LLC

   11% Secured Debt   (8)     —     —     49     1,622     4     —     1,626  

  Member Units   (8)     —     (80 )   —     1,370     —     80     1,290  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

ATS Workholding, LLC

   5% Secured Debt   (9)     —     110     88     4,390     136     42     4,484  

  Preferred Member Units   (9)     —     —     —     3,726     —     —     3,726  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Bond-Coat, Inc.

   12% Secured Debt   (8)     —     (229 )   373     11,596     26     229     11,393  

  Common Stock   (8)     —     (2,480 )   —     9,370     —     2,480     6,890  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Brewer Crane Holdings, LLC

   LIBOR Plus 10.00% (Floor 1.00%)   (9)     —     —     299     9,467     4     124     9,347  

  Preferred Member Units   (9)     —     —     30     4,280     —     —     4,280  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

CBT Nuggets, LLC

   Member Units   (9)     —     (980 )   300     61,610     —     980     60,630  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Centre Technologies Holdings, LLC

   LIBOR Plus 9.00% (Floor 2.00%)   (8)     —     —     496     —     12,122     —     12,122  

  Preferred Member Units   (8)     —     —     30     —     5,840     —     5,840  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Chamberlin Holding LLC

   LIBOR Plus 10.00% (Floor 1.00%)   (8)     —     —     656     20,028     8     —     20,036  

  Member Units   (8)     —     2,180     203     18,940     2,180     —     21,120  

  Member Units   (8)     —     —     —     732     —     —     732  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Charps, LLC

   11.50% Secured Debt   (5)     —     (10 )   343     11,888     10     676     11,222  

  Preferred Member Units   (5)     —     1,480     163     2,270     1,480     —     3,750  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Copper Trail Fund Investments

   LP Interests (CTMH, LP)   (9)     —     —     5     872     —     —     872  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Datacom, LLC

   8% Secured Debt   (8)     —     —     —     1,690     —     —     1,690  

  10.50% PIK Secured Debt   (8)     —     —     —     9,786     —     —     9,786  

  Class A Preferred Member Units   (8)     —     —     —     —     —     —     —  

  Class B Preferred Member Units   (8)     —     —     —     —     —     —     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Digital Products Holdings LLC

   LIBOR Plus 10.00% (Floor 1.00%)   (5)     —     —     812     25,511     13     330     25,194  

  Preferred Member Units   (5)     —     (501 )   50     8,466     —     501     7,965  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Garreco, LLC

   LIBOR Plus 8.00% (Floor 1.00%, Ceiling 1.50%)   (8)     —     —     124     5,099     6     362     4,743  

  Member Units   (8)     —     (90 )   —     2,590     —     90     2,500  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Gulf Manufacturing, LLC

   Member Units   (8)     —     —     340     11,690     —     —     11,690  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Gulf Publishing Holdings, LLC

   LIBOR Plus 9.50% (Floor 1.00%)   (8)     —     —     1     —     80     —     80  

  12.5% Secured Debt   (8)     —     —     401     12,594     8     130     12,472  

  Member Units   (8)     —     210     —     4,120     210     —     4,330  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Harris Preston Fund Investments

   LP Interests (2717 MH, L.P.)   (8)     —     —     —     1,133     1,195     —     2,328  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Harrison Hydra-Gen, Ltd.

   Common Stock   (8)     —     530     217     8,070     530     —     8,600  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

KBK Industries, LLC

   Member Units   (5)     —     2,130     418     8,610     2,130     —     10,740  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

NAPCO Precast, LLC

   LIBOR Plus 8.50%   (8)     —     (11 )   123     11,475     11     11,486     —  

  Member Units   (8)     —     340     1,000     13,990     340     —     14,330  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

NexRev LLC

   11% Secured Debt   (8)     —     —     487     17,288     8     —     17,296  

  Preferred Member Units   (8)     —     (1,010 )   20     7,890     —     1,010     6,880  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

NRI Clinical Research, LLC

   LIBOR Plus 6.75% (Floor 1.50%)   (9)     —     —     4     —     200     —     200  

  14% Secured Debt   (9)     —     (8 )   242     6,685     8     8     6,685  

  Warrants   (9)     —     40     —     660     40     —     700  

  Member Units   (9)     —     200     —     2,478     200     —     2,678  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

NRP Jones, LLC

   12% Secured Debt   (5)     —     —     191     6,376     —     —     6,376  

  Member Units   (5)     —     300     —     5,960     300     —     6,260  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

NuStep, LLC

   12% Secured Debt   (5)     —     —     629     20,458     10     —     20,468  

  Preferred Member Units   (5)     —     —     —     10,200     —     —     10,200  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

OMi Holdings, Inc.

   Common Stock   (8)     —     320     479     16,020     320     —     16,340  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Pegasus Research Group, LLC

   Member Units   (8)     —     (400 )   —     7,680     —     400     7,280  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

104

Table of Contents

Company
  Investment(1)(10)(11)   Geography   Amount
of
Realized
Gain/
(Loss) 		  Amount
of
Unrealized
Gain/
(Loss) 		  Amount
of
Interest,
Fees or
Dividends
Credited
to
Income(2) 		  December 31,
2018
Fair Value 		  Gross
Additions(3) 		  Gross
Reductions(4) 		  March 31,
2019
Fair
Value 		 

River Aggregates, LLC

   Zero Coupon Secured Debt   (8)     —     —     —     722     —     —     722  

  Member Units   (8)     —     —     —     4,610     —     —     4,610  

  Member Units   (8)     —     —     —     2,930     —     —     2,930  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Tedder Industries, LLC

   12%, Secured Debt   (9)     —     —     15     480     —     —     480  

  12%, Secured Debt   (9)     —     —     498     16,246     6     —     16,252  

  Preferred Member Units   (9)     —     —     —     7,476     —     —     7,476  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Other

                                                    

Amounts related to investments transferred to or from other 1940 Act classification during the period

             (187 )   —     265     18,050     —     —     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Total Control investments

           $ (187 ) $ 4,946   $ 23,691   $ 1,004,993   $ 63,209   $ 40,395   $ 1,009,757  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Affiliate Investments

                                                    

                                                   

AFG Capital Group, LLC

  

Warrants

  

(8)

  
$
—		  
$
90		  
$
—		  
$
950		  
$
90		  
$
—		  
$
1,040		  

  Preferred Member Units   (8)     —     390     —     3,980     390     —     4,370  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

American Trailer Rental Group LLC

   LIBOR Plus 7.25% (Floor 1.00%)   (5)     —     —     660     20,312     3,734     —     24,046  

  Member Units   (5)     —     940     —     5,780     940     —     6,720  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Barfly Ventures, LLC

   12% Secured Debt   (5)     —     —     314     10,018     8     —     10,026  

  Options   (5)     —     —     —     940     —     —     940  

  Warrants   (5)     —     —     —     410     —     —     410  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

BBB Tank Services, LLC

   LIBOR Plus 11% (Floor 1.00%)   (8)     —     —     159     3,833     416     —     4,249  

  Preferred Member Units   (8)     —     —     5     113     5     —     118  

  Member Units   (8)     —     —     —     230     —     —     230  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Boccella Precast Products LLC

   LIBOR Plus 10% (Floor 1.00%)   (6)     —     (12 )   525     15,724     412     412     15,724  

  Member Units   (6)     —     (170 )   15     5,080     —     170     4,910  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Boss Industries, LLC

   Preferred Member Units   (5)     3,771     (3,932 )   611     6,176     —     6,176     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Bridge Capital Solutions Corporation

   13% Secured Debt   (6)     —     —     340     6,221     96     —     6,317  

  Warrants   (6)     —     (260 )   —     4,020     —     260     3,760  

  13% Secured Debt   (6)     —     —     33     1,000     —     —     1,000  

  Preferred Member Units   (6)     —     —     25     1,000     —     —     1,000  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Buca C, LLC

   LIBOR Plus 9.25% (Floor 1.00%)   (7)     —     —     569     19,038     11     101     18,948  

  Preferred Member Units   (7)     —     —     64     4,431     64     —     4,495  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

CAI Software LLC

   12% Secured Debt   (6)     —     (4 )   331     10,880     4     4     10,880  

  Member Units   (6)     —     —     —     2,717     —     —     2,717  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Chandler Signs Holdings, LLC

   12% Secured Debt/1.00% PIK   (8)     —     (2 )   150     4,546     13     2     4,557  

  Class A Units   (8)     —     —     —     2,120     —     —     2,120  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Charlotte Russe, Inc

   8.50% Secured Debt   (9)     (7,012 )   4,003     —     3,930     4,003     7,933     —  

  Common Stock   (9)     —     —     —     —     —     —     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Condit Exhibits, LLC

   Member Units   (9)     —     —     83     1,950     —     —     1,950  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Congruent Credit Opportunities Funds

   LP Interests (Fund II)   (8)     —     —     —     855     —     —     855  

  LP Interests (Fund III)   (8)     —     177     160     17,468     177     —     17,645  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Copper Trail Fund Investments

   LP Interests (Copper Trail Energy Fund I, LP)   (9)     —     (51 )   —     4,170     —     240     3,930  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Dos Rios Partners

   LP Interests (Dos Rios Partners, LP)   (8)     —     (129 )   —     7,153     —     129     7,024  

  LP Interests (Dos Rios Partners—A, LP)   (8)     —     (41 )   —     2,271     —     41     2,230  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

East Teak Fine Hardwoods, Inc.

   Common Stock   (7)     —     —     4     560     —     —     560  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

EIG Fund Investments

   LP Interests (EIG Global Private Debt fund—A, L.P.)   (8)     —     —     25     505     148     5     648  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Freeport Financial Funds

   LP Interests (Freeport Financial SBIC Fund LP)   (5)     —     54     —     5,399     54     —     5,453  

  LP Interests (Freeport First Lien Loan Fund III LP)   (5)     —     —     255     10,980     —     1,399     9,581  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Harris Preston Fund Investments

   LP Interests (HPEP 3, L.P.)   (8)     —     —     —     1,733     238     —     1,971  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Hawk Ridge Systems, LLC

   10.0% Secured Debt   (9)     —     (13 )   381     14,300     13     913     13,400  

  Preferred Member Units   (9)     —     —     225     7,260     —     —     7,260  

  Preferred Member Units   (9)     —     —     —     380     —     —     380  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Houston Plating and Coatings, LLC

   8% Unsecured Convertible Debt   (8)     —     100     60     3,720     100     —     3,820  

  Member Units   (8)     —     380     112     8,330     380     —     8,710  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

I-45 SLF LLC

   Member Units   (8)     —     (209 )   794     15,627     800     209     16,218  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

L.F. Manufacturing Holdings, LLC

   Preferred Member Units   (8)     —     —     3     —     73     —     73  

  Member Units   (8)     —     —     —     2,060     —     —     2,060  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

OnAsset Intelligence, Inc.

   12% PIK Secured Debt   (8)     —     —     172     5,743     172     —     5,915  

  10% PIK Secured Debt   (8)     —     —     1     53     1     —     54  

  Preferred Stock   (8)     —     —     —     —     —     —     —  

  Warrants   (8)     —     —     —     —     —     —     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

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Company
  Investment(1)(10)(11)   Geography   Amount
of
Realized
Gain/
(Loss) 		  Amount
of
Unrealized
Gain/
(Loss) 		  Amount
of
Interest,
Fees or
Dividends
Credited
to
Income(2) 		  December 31,
2018
Fair Value 		  Gross
Additions(3) 		  Gross
Reductions(4) 		  March 31,
2019
Fair
Value 		 

PCI Holding Company, Inc.

   12% Current/3% PIK Secured Debt   (9)     —     —     447     11,908     98     325     11,681  

  Preferred Stock   (9)     —     (140 )   —     340     —     140     200  

  Preferred Stock   (9)     —     870     —     3,480     870     —     4,350  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Rocaceia, LLC (Quality Lease and Rental

   12% Secured Debt   (8)     —     —     —     250     —     —     250  

Holdings, LLC)

   Preferred Member Units   (8)     —     —     —     —     —     —     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Salado Stone Holdings, LLC

   Class A Preferred Units   (8)     —     430     —     1,040     430     —     1,470  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

SI East, LLC

   10.25% Current, Secured Debt   (7)     —     —     930     34,885     19     —     34,904  

  Preferred Member Units   (7)     —     —     —     6,000     —     —     6,000  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Slick Innovations, LLC

   14.00% Current, Secured Debt   (6)     —     —     267     6,959     19     320     6,658  

  Warrants   (6)     —     —     —     181     —     —     181  

  Member Units   (6)     —     —     —     700     —     —     700  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

UniTek Global Services, Inc.

   LIBOR Plus 5.50% (Floor 1.00%)   (6)     —     —     61     2,969     —     9     2,960  

  Preferred Stock   (6)     —     —     250     7,413     250     —     7,663  

  Preferred Stock   (6)     —     —     78     1,637     78     —     1,715  

  Preferred Stock   (6)     —     —     144     3,038     145     —     3,183  

  Common Stock   (6)     —     400     —     1,420     400     —     1,820  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Universal Wellhead Services Holdings, LLC

   Preferred Member Units   (8)     —     (25 )   65     950     65     25     990  

  Member Units   (8)     —     (470 )   —     2,330     —     470     1,860  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Volusion, LLC

   11.5% Secured Debt   (8)     —     —     747     18,407     1,147     —     19,554  

  8% Unsecured Convertible Debt   (8)     —     —     6     297     112     —     409  

  Preferred Member Units   (8)     —     —     —     14,000     —     —     14,000  

  Warrants   (8)     —     —     —     1,890     —     —     1,890  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Other

                                                    

Amounts related to investments transferred to or from other 1940 Act classification during the period

             —     —     —     (4,170 )   —     —     —  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Total Affiliate investments

           $ (3,241 ) $ 2,376   $ 9,071   $ 359,890   $ 15,975   $ 19,283   $ 360,752  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
(1)
The principal amount, the ownership detail for equity investments and if the investment is income producing is included in the consolidated schedule of investments.

(2)
Represents the total amount of interest, fees and dividends credited to income for the portion of the period for which an investment was included in Control or Affiliate categories, respectively. For investments transferred between Control and Affiliate categories during the period, any income or investment balances related to the time period it was in the category other than the one shown at period end is included in "Amounts from investments transferred from other 1940 Act classifications during the period."

(3)
Gross additions include increases in the cost basis of investments resulting from new portfolio investments, follow-on investments and accrued PIK interest, and the exchange of one or more existing securities for one or more new securities. Gross additions also include net increases in unrealized appreciation or net decreases in net unrealized depreciation as well as the movement of an existing portfolio company into this category and out of a different category.

(4)
Gross reductions include decreases in the cost basis of investments resulting from principal repayments or sales and the exchange of one or more existing securities for one or more new securities. Gross reductions also include net increases in net unrealized depreciation or net decreases in unrealized appreciation as well as the movement of an existing portfolio company out of this category and into a different category.

(5)
Portfolio company located in the Midwest region as determined by location of the corporate headquarters. The fair value as of March 31, 2019 for control investments located in this region was $258,033. This represented 16.9% of net assets as of March 31, 2019. The fair value as of March 31, 2019 for affiliate investments located in this region was $57,176. This represented 3.8% of net assets as of March 31, 2019.

(6)
Portfolio company located in the Northeast region as determined by location of the corporate headquarters. The fair value as of March 31, 2019 for control investments located in this region was $8,198. This represented 0.5% of net assets as of March 31, 2019. The fair value as of March 31, 2019 for affiliate investments located in this region was $71,188. This represented 4.7% of net assets as of March 31, 2019.

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(7)
Portfolio company located in the Southeast region as determined by location of the corporate headquarters. The fair value as of March 31, 2019 for control investments located in this region was $15,925. This represented 1.0% of net assets as of March 31, 2019. The fair value as of March 31, 2019 for affiliate investments located in this region was $64,907. This represented 4.3% of net assets as of March 31, 2019.

(8)
Portfolio company located in the Southwest region as determined by location of the corporate headquarters. The fair value as of March 31, 2019 for control investments located in this region was $419,339. This represented 27.5% of net assets as of March 31, 2019. The fair value as of March 31, 2019 for affiliate investments located in this region was $124,330. This represented 8.2% of net assets as of March 31, 2019.

(9)
Portfolio company located in the West region as determined by location of the corporate headquarters. The fair value as of March 31, 2019 for control investments located in this region was $308,262. This represented 20.2% of net assets as of March 31, 2019. The fair value as of March 31, 2019 for affiliate investments located in this region was $43,151. This represented 2.8% of net assets as of March 31, 2019.

(10)
All of the Company's portfolio investments are generally subject to restrictions on resale as "restricted securities," unless otherwise noted.

(11)
This schedule should be read in conjunction with the consolidated schedule of investments and notes to the consolidated financial statements. Supplemental information can be located within the schedule of investments including end of period interest rate, preferred dividend rate, maturity date, investments not paid currently in cash and investments whose value was determined using significant unobservable inputs.

(12)
Investment has an unfunded commitment as of March 31, 2019 (see Note K). The fair value of the investment includes the impact of the fair value of any unfunded commitments.

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Item 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

        This Quarterly Report on Form 10-Q contains forward-looking statements regarding the plans and objectives of management for future operations and which relate to future events or our future performance or financial condition. Any such forward-looking statements may involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements to be materially different from future results, performance or achievements expressed or implied by any forward-looking statements. Forward-looking statements, which involve assumptions and describe our future plans, strategies and expectations, are generally identifiable by use of the words "may," "will," "should," "expect," "anticipate," "estimate," "believe," "intend" or "project" or the negative of these words or other variations on these words or comparable terminology. These forward-looking statements are based on assumptions that may be incorrect, and we cannot assure you that the projections included in these forward-looking statements will come to pass. Our actual results could differ materially from those expressed or implied by the forward-looking statements as a result of various factors, including, without limitation: changes in laws and regulations and adverse changes in the economy generally or in the industries in which our portfolio companies operate, including with respect to changes from the impact of the COVID-19 pandemic, and the resulting impacts on our and our portfolio companies' business and operations, liquidity and access to capital; and such other factors discussed in Item 1A entitled "Risk Factors" below in Part 2 of this Quarterly Report on Form 10-Q, in Item 1A entitled "Risk Factors" in Part I of our Annual Report on Form 10-K for the year ended December 31, 2019, filed with the Securities and Exchange Commission (the "SEC") on February 28, 2020 and elsewhere in this Quarterly Report on Form 10-Q and our other SEC filings.

        We have based the forward-looking statements included in this Quarterly Report on Form 10-Q on information available to us on the date of this Quarterly Report on Form 10-Q, and we assume no obligation to update any such forward-looking statements, unless we are required to do so by applicable law. However, you are advised to refer to any additional disclosures that we may make directly to you or through reports that we in the future may file with the SEC, including subsequent periodic and current reports.

ORGANIZATION

        Main Street Capital Corporation ("MSCC") is a principal investment firm primarily focused on providing customized debt and equity financing to lower middle market ("LMM") companies and debt capital to middle market ("Middle Market") companies. The portfolio investments of MSCC and its consolidated subsidiaries are typically made to support management buyouts, recapitalizations, growth financings, refinancings and acquisitions of companies that operate in a variety of industry sectors. MSCC seeks to partner with entrepreneurs, business owners and management teams and generally provides "one stop" financing alternatives within its LMM portfolio. MSCC and its consolidated subsidiaries invest primarily in secured debt investments, equity investments, warrants and other securities of LMM companies based in the United States and in secured debt investments of Middle Market companies generally headquartered in the United States.

        MSCC was formed in March 2007 to operate as an internally managed business development company ("BDC") under the Investment Company Act of 1940, as amended (the "1940 Act"). MSCC wholly owns several investment funds, including Main Street Mezzanine Fund, LP ("MSMF"), Main Street Capital II, LP ("MSC II") and Main Street Capital III, LP ("MSC III" and, collectively with MSMF and MSC II, the "Funds"), and each of their general partners. The Funds are each licensed as a Small Business Investment Company ("SBIC") by the United States Small Business Administration ("SBA"). Because MSCC is internally managed, all of the executive officers and other employees are employed by MSCC. Therefore, MSCC does not pay any external investment advisory fees, but instead directly incurs the operating costs associated with employing investment and portfolio management professionals.

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        MSC Adviser I, LLC (the "External Investment Manager") was formed in November 2013 as a wholly owned subsidiary of MSCC to provide investment management and other services to parties other than MSCC and its subsidiaries or their portfolio companies ("External Parties") and receives fee income for such services. MSCC has been granted no-action relief by the SEC to allow the External Investment Manager to register as a registered investment adviser under the Investment Advisers Act of 1940, as amended. Since the External Investment Manager conducts all of its investment management activities for External Parties, it is accounted for as a portfolio investment of MSCC and is not included as a consolidated subsidiary of MSCC in MSCC's consolidated financial statements.

        MSCC has elected to be treated for U.S. federal income tax purposes as a regulated investment company ("RIC") under Subchapter M of the Internal Revenue Code of 1986, as amended (the "Code"). As a result, MSCC generally will not pay corporate-level U.S. federal income taxes on any net ordinary taxable income or capital gains that it distributes to its stockholders.

        MSCC has certain direct and indirect wholly owned subsidiaries that have elected to be taxable entities (the "Taxable Subsidiaries"). The primary purpose of the Taxable Subsidiaries is to permit MSCC to hold equity investments in portfolio companies which are "pass-through" entities for tax purposes.

        Unless otherwise noted or the context otherwise indicates, the terms "we," "us," "our," the "Company" and "Main Street" refer to MSCC and its consolidated subsidiaries, which include the Funds and the Taxable Subsidiaries.

COVID-19 UPDATE

        The COVID-19 pandemic, and the related effect on the U.S. and global economies, has had, and threatens to continue to have, adverse consequences for our business and operating results, and the businesses and operating results of our portfolio companies. During the quarter ended March 31, 2020, we began to work collectively with our employees and portfolio companies to navigate the significant challenges created by the COVID-19 pandemic. We remain focused on ensuring the safety of our employees and the employees of our portfolio companies, while also managing our ongoing business activities. In this regard, we remain heavily engaged with our portfolio companies. As discussed below under "Discussion and Analysis of Results of Operations," our net asset value as of March 31, 2020 decreased as compared to our net asset value as of December 31, 2019, primarily due to the unrealized depreciation of our Investment Portfolio caused by the immediate adverse economic effects of the COVID-19 pandemic and uncertainty regarding the extent and duration of its impact, as well as the negative impact of the pandemic on our investment income.

        Neither our management nor our Board of Directors is able to predict the full impact of the COVID-19 pandemic, including its duration and the magnitude of its economic and societal impact. As such, while we will continue to monitor the rapidly evolving situation and guidance from U.S. and international authorities, including federal, state and local public health authorities, we are unable to predict with any certainty the extent to which the outbreak will negatively affect our portfolio companies' operating results and financial condition or the impact that such disruptions may have on our results of operations and financial condition.

OVERVIEW

        Our principal investment objective is to maximize our portfolio's total return by generating current income from our debt investments and capital appreciation from our equity and equity-related investments, including warrants, convertible securities and other rights to acquire equity securities in a portfolio company. Our LMM companies generally have annual revenues between $10 million and $150 million, and our LMM portfolio investments generally range in size from $5 million to $50 million. Our Middle Market investments are made in businesses that are generally larger in size

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than our LMM portfolio companies, with annual revenues typically between $150 million and $1.5 billion, and our Middle Market investments generally range in size from $3 million to $20 million. Our Private Loan portfolio investments are primarily debt securities in privately held companies which have been originated through strategic relationships with other investment funds on a collaborative basis. Private Loan investments are typically similar in size, structure, terms and conditions to investments we hold in our LMM portfolio and Middle Market portfolio.

        We seek to fill the financing gap for LMM businesses, which, historically, have had limited access to financing from commercial banks and other traditional sources. The underserved nature of the LMM creates the opportunity for us to meet the financing needs of LMM companies while also negotiating favorable transaction terms and equity participations. Our ability to invest across a company's capital structure, from secured loans to equity securities, allows us to offer portfolio companies a comprehensive suite of financing options, or a "one stop" financing solution. Providing customized, "one stop" financing solutions is important to LMM portfolio companies. We generally seek to partner directly with entrepreneurs, management teams and business owners in making our investments. Our LMM portfolio debt investments are generally secured by a first lien on the assets of the portfolio company and typically have a term of between five and seven years from the original investment date.

        Our Middle Market portfolio investments primarily consist of direct investments in or secondary purchases of interest-bearing debt securities in privately held companies that are generally larger in size than the companies included in our LMM portfolio. Our Middle Market portfolio debt investments are generally secured by either a first or second priority lien on the assets of the portfolio company and typically have an expected duration of between three and seven years from the original investment date.

        Our Private Loan portfolio investments are primarily debt securities in privately held companies that have been originated through strategic relationships with other investment funds on a collaborative basis and are often referred to in the debt markets as "club deals." Private Loan investments are typically similar in size, structure, terms and conditions to investments we hold in our LMM portfolio and Middle Market portfolio. Our Private Loan portfolio debt investments are generally secured by either a first or second priority lien on the assets of the portfolio company and typically have a term of between three and seven years from the original investment date.

        Our other portfolio ("Other Portfolio") investments primarily consist of investments that are not consistent with the typical profiles for our LMM, Middle Market or Private Loan portfolio investments, including investments which may be managed by third parties. In our Other Portfolio, we may incur indirect fees and expenses in connection with investments managed by third parties, such as investments in other investment companies or private funds.

        Our external asset management business is conducted through the External Investment Manager. The External Investment Manager earns management fees based on the assets of the funds under management and may earn incentive fees, or a carried interest, based on the performance of the funds managed. We have entered into an agreement with the External Investment Manager to share employees in connection with its asset management business generally, and specifically for its relationship with HMS Income Fund, Inc. ("HMS Income"). Through this agreement, we share employees with the External Investment Manager, including their related infrastructure, business relationships, management expertise and capital raising capabilities.

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        The following tables provide a summary of our investments in the LMM, Middle Market and Private Loan portfolios as of March 31, 2020 and December 31, 2019 (this information excludes the Other Portfolio investments and the External Investment Manager which are discussed further below):

 
   As of March 31, 2020  
 
   LMM(a)   Middle
Market 		  Private Loan  
 
   (dollars in millions)
  

Number of portfolio companies

     70     48     63  

Fair value

   $ 1,168.2   $ 418.4   $ 629.1  

Cost

   $ 991.5   $ 540.8   $ 740.1  

% of portfolio at cost—debt

     64.1%     94.4%     94.6%  

% of portfolio at cost—equity

     35.9%     5.6%     5.4%  

% of debt investments at cost secured by first priority lien

     98.1%     90.8%     95.4%  

Weighted-average annual effective yield(b)

     11.8%     8.1%     9.0%  

Average EBITDA(c)

   $ 5.5   $ 80.6   $ 51.9  
(a)
At March 31, 2020, we had equity ownership in approximately 99% of our LMM portfolio companies, and the average fully diluted equity ownership in those portfolio companies was approximately 41%.

(b)
The weighted-average annual effective yields were computed using the effective interest rates for all debt investments at cost as of March 31, 2020, including amortization of deferred debt origination fees and accretion of original issue discount but excluding fees payable upon repayment of the debt instruments and any debt investments on non-accrual status. Weighted-average annual effective yield is higher than what an investor in shares of our common stock will realize on its investment because it does not reflect our expenses or any sales load paid by an investor.

(c)
The average EBITDA is calculated using a simple average for the LMM portfolio and a weighted-average for the Middle Market and Private Loan portfolios. These calculations exclude certain portfolio companies, including three LMM portfolio companies, one Middle Market portfolio company and three Private Loan portfolio companies, as

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    EBITDA is not a meaningful valuation metric for our investments in these portfolio companies, and those portfolio companies whose primary purpose is to own real estate.

 
   As of December 31, 2019  
 
   LMM(a)   Middle
Market 		  Private Loan  
 
   (dollars in millions)
  

Number of portfolio companies

     69     51     65  

Fair value

   $ 1,206.9   $ 522.1   $ 692.1  

Cost

   $ 1,002.2   $ 572.3   $ 734.8  

% of portfolio at cost—debt

     65.9%     94.8%     94.6%  

% of portfolio at cost—equity

     34.1%     5.2%     5.4%  

% of debt investments at cost secured by first priority lien

     98.1%     91.3%     95.4%  

Weighted-average annual effective yield(b)

     11.8%     8.6%     9.5%  

Average EBITDA(c)

   $ 5.1   $ 85.0   $ 57.8  
(a)
At December 31, 2019, we had equity ownership in approximately 99% of our LMM portfolio companies, and the average fully diluted equity ownership in those portfolio companies was approximately 42%.

(b)
The weighted-average annual effective yields were computed using the effective interest rates for all debt investments at cost as of December 31, 2019, including amortization of deferred debt origination fees and accretion of original issue discount but excluding fees payable upon repayment of the debt instruments and any debt investments on non-accrual status. Weighted-average annual effective yield is higher than what an investor in shares of our common stock will realize on its investment because it does not reflect our expenses or any sales load paid by an investor.

(c)
The average EBITDA is calculated using a simple average for the LMM portfolio and a weighted-average for the Middle Market and Private Loan portfolios. These calculations exclude certain portfolio companies, including three LMM portfolio companies, two Middle Market portfolio companies and three Private Loan portfolio companies, as EBITDA is not a meaningful valuation metric for our investments in these portfolio companies, and those portfolio companies whose primary purpose is to own real estate.

        As of March 31, 2020, we had Other Portfolio investments in eleven companies, collectively totaling approximately $95.5 million in fair value and approximately $118.5 million in cost basis and which comprised approximately 4.0% of our Investment Portfolio (as defined in "Critical Accounting Policies—Basis of Presentation" below) at fair value. As of December 31, 2019, we had Other Portfolio investments in eleven companies, collectively totaling approximately $106.7 million in fair value and approximately $118.4 million in cost basis and which comprised approximately 4.1% of our Investment Portfolio at fair value.

        As previously discussed, the External Investment Manager is a wholly owned subsidiary that is treated as a portfolio investment. As of March 31, 2020, there was no cost basis in this investment and the investment had a fair value of approximately $61.6 million, which comprised approximately 2.6% of our Investment Portfolio at fair value. As of December 31, 2019, there was no cost basis in this investment and the investment had a fair value of approximately $74.5 million, which comprised approximately 2.9% of our Investment Portfolio at fair value.

        Our portfolio investments are generally made through MSCC and the Funds. MSCC and the Funds share the same investment strategies and criteria, although they are subject to different

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regulatory regimes. An investor's return in MSCC will depend, in part, on the Funds' investment returns as they are wholly owned subsidiaries of MSCC.

        The level of new portfolio investment activity will fluctuate from period to period based upon our view of the current economic fundamentals, our ability to identify new investment opportunities that meet our investment criteria, and our ability to consummate the identified opportunities. The level of new investment activity, and associated interest and fee income, will directly impact future investment income. In addition, the level of dividends paid by portfolio companies and the portion of our portfolio debt investments on non-accrual status will directly impact future investment income. While we intend to grow our portfolio and our investment income over the long term, our growth and our operating results may be more limited during depressed economic periods. However, we intend to appropriately manage our cost structure and liquidity position based on applicable economic conditions and our investment outlook. The level of realized gains or losses and unrealized appreciation or depreciation on our investments will also fluctuate depending upon portfolio activity, economic conditions and the performance of our individual portfolio companies. The changes in realized gains and losses and unrealized appreciation or depreciation could have a material impact on our operating results.

        Because we are internally managed, we do not pay any external investment advisory fees, but instead directly incur the operating costs associated with employing investment and portfolio management professionals. We believe that our internally managed structure provides us with a beneficial operating expense structure when compared to other publicly traded and privately held investment firms which are externally managed, and our internally managed structure allows us the opportunity to leverage our non-interest operating expenses as we grow our Investment Portfolio. For the trailing twelve months ended March 31, 2020 and 2019, the ratio of our total operating expenses, excluding interest expense, as a percentage of our quarterly average total assets was 1.3% and 1.4%, respectively, and 1.4% for the year ended December 31, 2019.

        During May 2012, we entered into an investment sub-advisory agreement with HMS Adviser, LP ("HMS Adviser"), which is the investment advisor to HMS Income, a non-listed BDC, to provide certain investment advisory services to HMS Adviser. In December 2013, after obtaining required no-action relief from the SEC to allow us to own a registered investment adviser, we assigned the sub-advisory agreement to the External Investment Manager since the fees received from such arrangement could otherwise have negative consequences on our ability to meet the source-of-income requirement necessary for us to maintain our RIC tax treatment. Under the investment sub-advisory agreement, the External Investment Manager is entitled to 50% of the base management fee and the incentive fees earned by HMS Adviser under its advisory agreement with HMS Income. During the three months ended March 31, 2020 and 2019, the External Investment Manager earned $2.5 million and $3.0 million, respectively, in management fee income. No incentive fee income was earned in the three months ended March 31, 2020 compared to $0.1 million earned in the three months ended March 31, 2019.

        During April 2014, we received an exemptive order from the SEC permitting co-investments by us and HMS Income in certain negotiated transactions where co-investing would otherwise be prohibited under the 1940 Act. We have made, and in the future intend to continue to make, such co-investments with HMS Income in accordance with the conditions of the order. The order requires, among other things, that we and the External Investment Manager consider whether each such investment opportunity is appropriate for HMS Income and, if it is appropriate, to propose an allocation of the investment opportunity between us and HMS Income. Because the External Investment Manager may receive performance-based fee compensation from HMS Income, this may provide it an incentive to allocate opportunities to HMS Income instead of us. However, both we and the External Investment Manager have policies and procedures in place to manage this conflict.

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CRITICAL ACCOUNTING POLICIES

    Basis of Presentation

        Our consolidated financial statements are prepared in accordance with generally accepted accounting principles in the United States of America ("U.S. GAAP"). For each of the periods presented herein, our consolidated financial statements include the accounts of MSCC and its consolidated subsidiaries. The Investment Portfolio, as used herein, refers to all of our investments in LMM portfolio companies, investments in Middle Market portfolio companies, Private Loan portfolio investments, Other Portfolio investments, and the investment in the External Investment Manager. Our results of operations and cash flows for the three months ended March 31, 2020 and 2019, and financial position as of March 31, 2020 and December 31, 2019, are presented on a consolidated basis. The effects of all intercompany transactions between us and our consolidated subsidiaries have been eliminated in consolidation.

        Our accompanying unaudited consolidated financial statements are presented in conformity with U.S. GAAP for interim financial information and pursuant to the requirements for reporting on Form 10-Q and Articles 6, 10 and 12 of Regulation S-X. Accordingly, certain disclosures accompanying annual financial statements prepared in accordance with U.S. GAAP are omitted. In the opinion of management, the unaudited consolidated financial results included herein contain all adjustments, consisting solely of normal recurring accruals, considered necessary for the fair presentation of financial statements for the interim periods included herein. The results of operations for the three months ended March 31, 2020 and 2019 are not necessarily indicative of the operating results to be expected for the full year. Also, the unaudited financial statements and notes should be read in conjunction with the audited financial statements and notes thereto for the year ended December 31, 2019. Financial statements prepared on a U.S. GAAP basis require management to make estimates and assumptions that affect the amounts and disclosures reported in the financial statements and accompanying notes. Such estimates and assumptions could change in the future as more information becomes known, which could impact the amounts reported and disclosed herein.

        We are an investment company following the accounting and reporting guidance in Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") 946, Financial Services—Investment Companies ("ASC 946"). Under ASC 946, we are precluded from consolidating other entities in which we have equity investments, including those in which we have a controlling interest, unless the other entity is another investment company. An exception to this general principle in ASC 946 occurs if we hold a controlling interest in an operating company that provides all or substantially all of its services directly to us or to any of our portfolio companies. Accordingly, as noted above, our consolidated financial statements include the financial position and operating results for the Funds and the Taxable Subsidiaries. We have determined that all of our portfolio investments do not qualify for this exception, including the investment in the External Investment Manager. Therefore, our Investment Portfolio is carried on the consolidated balance sheet at fair value with any adjustments to fair value recognized as "Net Unrealized Appreciation (Depreciation)" on the consolidated statements of operations until the investment is realized, usually upon exit, resulting in any gain or loss being recognized as a "Net Realized Gain (Loss)."

    Investment Portfolio Valuation

        The most significant determination inherent in the preparation of our consolidated financial statements is the valuation of our Investment Portfolio and the related amounts of unrealized appreciation and depreciation. As of both March 31, 2020 and December 31, 2019, our Investment Portfolio valued at fair value represented approximately 96% of our total assets. We are required to report our investments at fair value. We follow the provisions of FASB ASC 820, Fair Value Measurements and Disclosures ("ASC 820"). ASC 820 defines fair value, establishes a framework for

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measuring fair value, establishes a fair value hierarchy based on the quality of inputs used to measure fair value and enhances disclosure requirements for fair value measurements. ASC 820 requires us to assume that the portfolio investment is to be sold in the principal market to independent market participants, which may be a hypothetical market. Market participants are defined as buyers and sellers in the principal market that are independent, knowledgeable and willing and able to transact. See "Note B.1.—Valuation of the Investment Portfolio" in the notes to consolidated financial statements for a detailed discussion of our investment portfolio valuation process and procedures.

        Due to the inherent uncertainty in the valuation process, our determination of fair value for our Investment Portfolio may differ materially from the values that would have been determined had a ready market for the securities existed. In addition, changes in the market environment, portfolio company performance and other events that may occur over the lives of the investments may cause the gains or losses ultimately realized on these investments to be materially different than the valuations currently assigned. We determine the fair value of each individual investment and record changes in fair value as unrealized appreciation or depreciation.

        Our Board of Directors has the final responsibility for overseeing, reviewing and approving, in good faith, our determination of the fair value for our Investment Portfolio and our valuation procedures, consistent with 1940 Act requirements. We believe our Investment Portfolio as of March 31, 2020 and December 31, 2019 approximates fair value as of those dates based on the markets in which we operate and other conditions in existence on those reporting dates.

    Revenue Recognition

    Interest and Dividend Income

        We record interest and dividend income on the accrual basis to the extent amounts are expected to be collected. Dividend income is recorded as dividends are declared by the portfolio company or at the point an obligation exists for the portfolio company to make a distribution. In accordance with our valuation policies, we evaluate accrued interest and dividend income periodically for collectability. When a loan or debt security becomes 90 days or more past due, and if we otherwise do not expect the debtor to be able to service all of its debt or other obligations, we will generally place the loan or debt security on non-accrual status and cease recognizing interest income on that loan or debt security until the borrower has demonstrated the ability and intent to pay contractual amounts due. If a loan or debt security's status significantly improves regarding the debtor's ability to service the debt or other obligations, or if a loan or debt security is sold or written off, we remove it from non-accrual status.

    Fee Income

        We may periodically provide services, including structuring and advisory services, to our portfolio companies or other third parties. For services that are separately identifiable and evidence exists to substantiate fair value, fee income is recognized as earned, which is generally when the investment or other applicable transaction closes. Fees received in connection with debt financing transactions for services that do not meet these criteria are treated as debt origination fees and are deferred and accreted into income over the life of the financing.

    Payment-in-Kind ("PIK") Interest and Cumulative Dividends

        We hold certain debt and preferred equity instruments in our Investment Portfolio that contain PIK interest and cumulative dividend provisions. The PIK interest, computed at the contractual rate specified in each debt agreement, is periodically added to the principal balance of the debt and is recorded as interest income. Thus, the actual collection of this interest may be deferred until the time of debt principal repayment. Cumulative dividends are recorded as dividend income, and any dividends in arrears are added to the balance of the preferred equity investment. The actual collection of these

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dividends in arrears may be deferred until such time as the preferred equity is redeemed or sold. To maintain RIC tax treatment (as discussed below), these non-cash sources of income may need to be paid out to stockholders in the form of distributions, even though we may not have collected the PIK interest and cumulative dividends in cash. We stop accruing PIK interest and cumulative dividends and write off any accrued and uncollected interest and dividends in arrears when we determine that such PIK interest and dividends in arrears are no longer collectible. For the three months ended March 31, 2020 and 2019, (i) approximately 1.1% and 1.9%, respectively, of our total investment income was attributable to PIK interest income not paid currently in cash and (ii) approximately 1.0% and 1.1%, respectively, of our total investment income was attributable to cumulative dividend income not paid currently in cash.

    Share-Based Compensation

        We account for our share-based compensation plans using the fair value method, as prescribed by ASC 718, Compensation—Stock Compensation. Accordingly, for restricted stock awards, we measure the grant date fair value based upon the market price of our common stock on the date of the grant and amortize the fair value of the awards as share-based compensation expense over the requisite service period, which is generally the vesting term.

        We have also adopted Accounting Standards Update ("ASU") 2016-09, Compensation—Stock Compensation: Improvements to Employee Share-Based Payment Accounting, which requires that all excess tax benefits and tax deficiencies (including tax benefits of dividends on share-based payment awards) be recognized as income tax expense or benefit in the income statement and not delay recognition of a tax benefit until the tax benefit is realized through a reduction to taxes payable. Accordingly, the tax effects of exercised or vested awards are treated as discrete items in the reporting period in which they occur. Additionally, we have elected to account for forfeitures as they occur.

    Income Taxes

        MSCC has elected to be treated for U.S. federal income tax purposes as a RIC. MSCC's taxable income includes the taxable income generated by MSCC and certain of its subsidiaries, including the Funds, which are treated as disregarded entities for tax purposes. As a RIC, MSCC generally will not pay corporate-level U.S. federal income taxes on any net ordinary taxable income or capital gains that MSCC distributes to its stockholders. MSCC must generally distribute at least 90% of its "investment company taxable income" (which is generally its net ordinary taxable income and realized net short-term capital gains in excess of realized net long-term capital losses) and 90% of its tax-exempt income to maintain its RIC status (pass-through tax treatment for amounts distributed). As part of maintaining RIC status, undistributed taxable income (subject to a 4% non-deductible U.S. federal excise tax) pertaining to a given fiscal year may be distributed up to 12 months subsequent to the end of that fiscal year, provided such dividends are declared on or prior to the later of (i) filing of the U.S. federal income tax return for the applicable fiscal year or (ii) the fifteenth day of the ninth month following the close of the year in which such taxable income was generated.

        The Taxable Subsidiaries primarily hold certain portfolio investments for us. The Taxable Subsidiaries permit us to hold equity investments in portfolio companies which are "pass-through" entities for tax purposes and to continue to comply with the "source-of-income" requirements contained in the RIC tax provisions of the Code. The Taxable Subsidiaries are consolidated with us for U.S. GAAP financial reporting purposes, and the portfolio investments held by the Taxable Subsidiaries are included in our consolidated financial statements as portfolio investments and recorded at fair value. The Taxable Subsidiaries are not consolidated with MSCC for income tax purposes and may generate income tax expense, or benefit, and tax assets and liabilities, as a result of their ownership of certain portfolio investments. The taxable income, or loss, of the Taxable Subsidiaries may differ from their book income, or loss, due to temporary book and tax timing differences and permanent

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differences. The Taxable Subsidiaries are each taxed at their normal corporate tax rates based on their taxable income. The income tax expense, or benefit, if any, and the related tax assets and liabilities, of the Taxable Subsidiaries are reflected in our consolidated financial statements.

        The External Investment Manager is an indirect wholly owned subsidiary of MSCC owned through a Taxable Subsidiary and is a disregarded entity for tax purposes. The External Investment Manager has entered into a tax sharing agreement with its Taxable Subsidiary owner. Since the External Investment Manager is accounted for as a portfolio investment of MSCC and is not included as a consolidated subsidiary of MSCC in MSCC's consolidated financial statements, and as a result of the tax sharing agreement with its Taxable Subsidiary owner, for its stand-alone financial reporting purposes the External Investment Manager is treated as if it is taxed at normal corporate tax rates based on its taxable income and, as a result of its activities, may generate income tax expense or benefit. The income tax expense, or benefit, if any, and the related tax assets and liabilities, of the External Investment Manager are reflected in the External Investment Manager's separate financial statements.

        The Taxable Subsidiaries and the External Investment Manager use the liability method in accounting for income taxes. Deferred tax assets and liabilities are recorded for temporary differences between the tax basis of assets and liabilities and their reported amounts in the consolidated financial statements, using statutory tax rates in effect for the year in which the temporary differences are expected to reverse. A valuation allowance is provided, if necessary, against deferred tax assets when it is more likely than not that some portion or all of the deferred tax asset will not be realized.

        Taxable income generally differs from net income for financial reporting purposes due to temporary and permanent differences in the recognition of income and expenses. Taxable income generally excludes net unrealized appreciation or depreciation, as investment gains or losses are not included in taxable income until they are realized.

INVESTMENT PORTFOLIO COMPOSITION

        Our LMM portfolio investments primarily consist of secured debt, equity warrants and direct equity investments in privately held, LMM companies based in the United States. Our LMM portfolio companies generally have annual revenues between $10 million and $150 million, and our LMM investments generally range in size from $5 million to $50 million. The LMM debt investments are typically secured by either a first or second priority lien on the assets of the portfolio company, can include either fixed or floating rate terms and generally have a term of between five and seven years from the original investment date. In most LMM portfolio investments, we receive nominally priced equity warrants and/or make direct equity investments in connection with a debt investment.

        Our Middle Market portfolio investments primarily consist of direct investments in or secondary purchases of interest-bearing debt securities in privately held companies based in the United States that are generally larger in size than the companies included in our LMM portfolio. Our Middle Market portfolio companies generally have annual revenues between $150 million and $1.5 billion, and our Middle Market investments generally range in size from $3 million to $20 million. Our Middle Market portfolio debt investments are generally secured by either a first or second priority lien on the assets of the portfolio company and typically have a term of between three and seven years from the original investment date.

        Our Private Loan portfolio investments are primarily debt securities in privately held companies which have been originated through strategic relationships with other investment funds on a collaborative basis and are often referred to in the debt markets as "club deals." Private Loan investments are typically similar in size, structure, terms and conditions to investments we hold in our LMM portfolio and Middle Market portfolio. Our Private Loan portfolio debt investments are generally secured by either a first or second priority lien on the assets of the portfolio company and typically have a term of between three and seven years from the original investment date.

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        Our Other Portfolio investments primarily consist of investments which are not consistent with the typical profiles for LMM, Middle Market and Private Loan portfolio investments, including investments which may be managed by third parties. In the Other Portfolio, we may incur indirect fees and expenses in connection with investments managed by third parties, such as investments in other investment companies or private funds.

        Our external asset management business is conducted through the External Investment Manager. The External Investment Manager earns management fees based on the assets of the funds under management and may earn incentive fees, or a carried interest, based on the performance of the funds managed. We have entered into an agreement with the External Investment Manager to share employees in connection with its asset management business generally, and specifically for its relationship with HMS Income. Through this agreement, we share employees with the External Investment Manager, including their related infrastructure, business relationships, management expertise and capital raising capabilities, and we allocate the related expenses to the External Investment Manager pursuant to the sharing agreement. Our total expenses for each of the three months ended March 31, 2020 and 2019 are net of expenses allocated to the External Investment Manager of $1.6 million. The External Investment Manager earns management fees based on the assets of the funds under management and may earn incentive fees, or a carried interest, based on the performance of the funds managed. The total contribution of the External Investment Manager to our net investment income consists of the combination of the expenses allocated to the External Investment Manager and the dividend income received from the External Investment Manager. For the three months ended March 31, 2020 and 2019, the total contribution to our net investment income was $2.3 million and $2.7 million, respectively.

        The following tables summarize the composition of our total combined LMM portfolio investments, Middle Market portfolio investments and Private Loan portfolio investments at cost and fair value by type of investment as a percentage of the total combined LMM portfolio investments, Middle Market portfolio investments and Private Loan portfolio investments as of March 31, 2020 and December 31, 2019 (this information excludes the Other Portfolio investments and the External Investment Manager).

Cost:
  March 31,
2020 		  December 31,
2019 		 

First lien debt

     77.3%     78.2%  

Equity

     18.2%     17.2%  

Second lien debt

     3.5%     3.5%  

Equity warrants

     0.5%     0.6%  

Other

     0.5%     0.5%  
​ ​ ​ ​ ​ ​ ​ ​

    100.0%     100.0%  
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​

 

Fair Value:
  March 31,
2020 		  December 31,
2019 		 

First lien debt

     69.1%     70.1%  

Equity

     27.2%     26.0%  

Second lien debt

     2.8%     3.0%  

Equity warrants

     0.4%     0.4%  

Other

     0.5%     0.5%  
​ ​ ​ ​ ​ ​ ​ ​

    100.0%     100.0%  
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​

        Our LMM portfolio investments, Middle Market portfolio investments and Private Loan portfolio investments carry a number of risks including: (1) investing in companies which may have limited

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operating histories and financial resources; (2) holding investments that generally are not publicly traded and which may be subject to legal and other restrictions on resale; and (3) other risks common to investing in below investment grade debt and equity investments in our Investment Portfolio. Please see "Risk Factors—Risks Related to Our Investments" contained in our Form 10-K for the fiscal year ended December 31, 2019 and "Risk Factors" below in this Quarterly Report on Form 10-Q for a more complete discussion of the risks involved with investing in our Investment Portfolio.

PORTFOLIO ASSET QUALITY

        We utilize an internally developed investment rating system to rate the performance of each LMM portfolio company and to monitor our expected level of returns on each of our LMM investments in relation to our expectations for the portfolio company. The investment rating system takes into consideration various factors, including each investment's expected level of returns, the collectability of our debt investments and the ability to receive a return of the invested capital in our equity investments, comparisons to competitors and other industry participants, the portfolio company's future outlook and other factors that are deemed to be significant to the portfolio company.

        As of March 31, 2020, our total Investment Portfolio had ten investments on non-accrual status, which comprised approximately 1.3% of its fair value and 5.3% of its cost. As of December 31, 2019, our total Investment Portfolio had eight investments on non-accrual status, which comprised approximately 1.4% of its fair value and 4.8% of its cost.

        The operating results of our portfolio companies are impacted by changes in the broader fundamentals of the United States economy. In the event that the United States economy contracts, it is likely that the financial results of small to mid-sized companies, like those in which we invest, could experience deterioration or limited growth from current levels, which could ultimately lead to difficulty in meeting their debt service requirements, to an increase in defaults on our debt investments or in realized losses on our investments and to difficulty in maintaining historical dividend payment rates and unrealized appreciation on our equity investments. Consequently, we can provide no assurance that the performance of certain portfolio companies will not be negatively impacted by economic cycles or other conditions, which could also have a negative impact on our future results.

DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS

    Comparison of the three months ended March 31, 2020 and March 31, 2019

 
   Three Months Ended
March 31, 		  Net Change  
 
   2020   2019   Amount   %  
 
   (dollars in thousands)
  

Total investment income

   $ 56,150   $ 61,365   $ (5,215 )   (8)%  

Total expenses

     (19,605 )   (21,874 )   2,269     10%  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Net investment income

     36,545     39,491     (2,946 )   (7)%  

Net realized loss from investments

     (21,865 )   (5,733 )   (16,132 )   NM  

Net realized loss on extinguishment of debt

     (534 )   (5,689 )   5,155     NM  

Net unrealized appreciation (depreciation) from:

                          

Portfolio investments

     (194,308 )   11,224     (205,532 )   NM  

SBIC debentures

     460     5,177     (4,717 )   NM  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Total net unrealized appreciation (depreciation)

     (193,848 )   16,401     (210,249 )   NM  

Income tax benefit (provision)

     8,264     (3,069 )   11,333     NM  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Net increase (decrease) in net assets resulting from operations

   $ (171,438 ) $ 41,401   $ (212,839 )   NM  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

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   Three Months Ended
March 31, 		  Net Change  
 
   2020   2019   Amount   %  
 
   (dollars in thousands,
except per share amounts)
  

Net investment income

   $ 36,545   $ 39,491   $ (2,946 )   (7)%  

Share-based compensation expense

     2,837     2,329     508     22%  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Distributable net investment income(a)

   $ 39,382   $ 41,820   $ (2,438 )   (6)%  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Net investment income per share—Basic and diluted

   $ 0.57   $ 0.64   $ (0.07 )   (11)%  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Distributable net investment income per share—Basic and diluted(a)

   $ 0.61   $ 0.68   $ (0.07 )   (10)%  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
NM
Not Meaningful

(a)
Distributable net investment income is net investment income as determined in accordance with U.S. GAAP, excluding the impact of share-based compensation expense which is non-cash in nature. We believe presenting distributable net investment income and related per share amounts is useful and appropriate supplemental disclosure of information for analyzing our financial performance since share-based compensation does not require settlement in cash. However, distributable net investment income is a non-U.S. GAAP measure and should not be considered as a replacement to net investment income and other earnings measures presented in accordance with U.S. GAAP. Instead, distributable net investment income should be reviewed only in connection with such U.S. GAAP measures in analyzing our financial performance. A reconciliation of net investment income in accordance with U.S. GAAP to distributable net investment income is presented in the table above.

    Investment Income

        Total investment income for the three months ended March 31, 2020 was $56.2 million, an 8% decrease from the $61.4 million of total investment income for the corresponding period of 2019. This comparable period decrease was principally attributable to (i) a $4.5 million decrease in dividend income from Investment Portfolio equity investments, partially attributable to the current negative impact of the COVID-19 pandemic on some of our portfolio companies' operating results, financial condition and liquidity, as well as the uncertainty relative to the duration of the virus' effects, and (ii) a $2.4 million decrease in interest income, which was also partially attributable to the negative impact of the COVID-19 pandemic, partially offset by a $1.7 million increase in fee income. The $5.2 million decrease in total investment income in the three months ended March 31, 2020 is net of the positive impact of an increase of $2.4 million in accelerated prepayment, repricing and other activity for certain Investment Portfolio debt investments.

    Expenses

        Total expenses for the three months ended March 31, 2020 decreased to $19.6 million from $21.9 million in the corresponding period of 2019. This decrease in operating expenses was principally attributable to a $3.6 million decrease in compensation expense, partially offset by (i) a $0.5 million increase in interest expense, (ii) a $0.5 million increase in share-based compensation expense and (iii) a $0.3 million increase in general and administrative expense. The decrease in compensation expense is primarily related to (i) a $2.5 million decrease in cash incentive compensation accruals and (ii) a $1.5 million decrease as a result of the decrease in the fair value of our deferred compensation plan assets, partially offset by a $0.4 million increase in base compensation-related expenses. The increase in interest expense is primarily due to a $4.3 million increase as a result of two separate issuances of our

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5.20% Notes (as defined below) in April 2019 and December 2019, partially offset by decreased interest expense relating to (i) a $2.1 million decrease from the repayment of the 4.50% Notes due 2019 (as defined below) effective December 1, 2019 and (ii) a $1.3 million decrease from our multi-year revolving credit facility (the "Credit Facility") due to the lower average balance outstanding and lower average interest rate on borrowings.

    Net Investment Income

        Net investment income for the three months ended March 31, 2020 decreased 7% to $36.5 million, or $0.57 per share, compared to net investment income of $39.5 million, or $0.64 per share, for the corresponding period of 2019. The decrease in net investment income was principally attributable to the decrease in total investment income, partially offset by lower operating expenses, both as discussed above.

    Distributable Net Investment Income

        Distributable net investment income for the three months ended March 31, 2020 decreased 6% to $39.4 million, or $0.61 per share, compared with $41.8 million, or $0.68 per share, in the corresponding period of 2019. The decline in distributable net investment income was primarily due to the decreased level of total investment income, partially offset by lower operating expenses, both as discussed above. Distributable net investment income on a per share basis for the three months ended March 31, 2020 also reflects a greater number of average shares outstanding compared to the corresponding period in 2019 primarily due to shares issued through the ATM Program (as defined in "—Liquidity and Capital Resources—Capital Resources" below), shares issued pursuant to our equity incentive plans and shares issued pursuant to our dividend reinvestment plan, partially offset by (i) an increase of $0.04 per share due to the increase in interest income from accelerated prepayment, repricing and other income activity considered non-recurring, as discussed above, and (ii) an increase of $0.02 per share due to the decrease in compensation expense as a result of the decrease in the fair value of the deferred compensation plan assets during the first quarter of 2020.

    Net Increase (Decrease) in Net Assets Resulting from Operations

        The net increase (decrease) in net assets resulting from operations for the three months ended March 31, 2020 was $(171.4) million, or $(2.66) per share, compared with $41.4 million, or $0.67 per share, during the three months ended March 31, 2019. This $212.8 million decrease from the prior year was primarily the result of (i) a $205.5 million decrease in net unrealized appreciation (depreciation) from portfolio investments, primarily caused by the adverse economic effects of the COVID-19 pandemic, and including the impact of accounting reversals relating to realized gains/income (losses), (ii) a $16.1 million decrease in the net realized gain (loss) from investments, (iii) a $4.7 million decrease in unrealized appreciation on the SBIC debentures accounted for on a fair value basis and (iv) a $2.9 million decrease in net investment income, as discussed above, partially offset by (i) a $5.2 million decrease in the net realized loss on extinguishment of debt from the prepayment of $22.0 million and $24.0 million of SBIC debentures in the three months ended March 31, 2020 and 2019, respectively, (ii) a $2.3 million decrease in total expenses, as discussed above, and (iii) an $11.3 million benefit from the change in the income tax benefit (provision). The net realized loss from investments of $21.9 million for the three months ended March 31, 2020 was primarily the result of (i) the realized loss of $17.2 million from the partial exit of two LMM investments and (ii) the realized loss of $4.3 million resulting from the full exit of an LMM investment.

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        The following table provides a summary of the total net unrealized depreciation of $193.8 million for the three months ended March 31, 2020:

 
   Three Months Ended March 31, 2020  
 
   LMM(a)   Middle Market   Private Loan   Other   Total  
 
   (dollars in millions)
  

Accounting reversals of net unrealized (appreciation) depreciation recognized in prior periods due to net realized (gains / income) losses recognized during the current period

   $ 17.6   $ 0.1   $ (0.4 )       $ 17.3  

Net unrealized depreciation relating to portfolio investments

   $ (45.6 ) $ (72.2 ) $ (68.4 ) $ (25.4) (b) $ (211.6 )
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Total net unrealized appreciation (depreciation) relating to portfolio investments

   $ (28.0 ) $ (72.1 ) $ (68.8 ) $ (25.4 ) $ (194.3 )
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Unrealized appreciation relating to SBIC debentures(c)

                             0.5  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Total net unrealizd depreciation

                           $ (193.8 )
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
(a)
LMM includes unrealized appreciation on 16 LMM portfolio investments and unrealized depreciation on 39 LMM portfolio investments.

(b)
Other includes (i) $12.9 million of unrealized depreciation relating to the External Investment Manager, (ii) $11.3 million of net unrealized depreciation relating to the Other Portfolio and (iii) $1.1 million of unrealized depreciation relating to deferred compensation plan assets.

(c)
Relates to unrealized depreciation on the SBIC debentures previously issued by MSC II which were accounted for on a fair value basis.

        The income tax benefit for the three months ended March 31, 2020 of $8.3 million principally consisted of a deferred tax benefit of $8.0 million, which is primarily the result of the net activity relating to our portfolio investments held in our Taxable Subsidiaries, including changes in loss carryforwards, changes in net unrealized appreciation/depreciation and other temporary book-tax differences, as well as a current tax benefit of $0.3 million related to a $0.8 million benefit for current U.S. federal and state income taxes, partially offset by a $0.5 million provision for excise tax on our estimated undistributed taxable income.

    Liquidity and Capital Resources

        This "Liquidity and Capital Resources" section should be read in conjunction with the "COVID-19 Update" section above.

    Cash Flows

        For the three months ended March 31, 2020, we experienced a net decrease in cash and cash equivalents in the amount of $1.1 million, which is the net result of $61.4 million of cash provided by our operating activities and $62.4 million of cash used in our financing activities.

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        The $61.4 million of cash provided by our operating activities resulted primarily from (i) cash flows we generated from the operating profits earned totaling $35.4 million, which is our distributable net investment income, excluding the non-cash effects of the accretion of unearned income, payment-in-kind interest income, cumulative dividends and the amortization expense for deferred financing costs, (ii) cash proceeds totaling $160.2 million from the sales and repayments of debt investments and sales of and return on capital of equity investments and (iii) cash proceeds of $4.4 million related to changes in other assets and liabilities, partially offset by cash uses totaling $138.6 million for the funding of new portfolio company investments and settlement of accruals for portfolio investments existing as of December 31, 2019.

        The $62.4 million of cash used in our financing activities principally consisted of (i) $35.6 million in cash dividends paid to stockholders, (ii) $23.0 in net repayments on the Credit Facility, (iii) $22.0 million in repayment of SBIC debentures and (iv) $0.6 million for payment of deferred debt issuance costs, SBIC debenture fees and other costs, partially offset by (i) $15.0 million in cash proceeds from the issuance of SBIC debentures and (ii) $3.9 million in net cash proceeds from our ATM Program (described below) and direct stock purchase plan.

    Capital Resources

        As of March 31, 2020, we had $54.2 million in cash and cash equivalents and $463.0 million of unused capacity under the Credit Facility, which we maintain to support our investment and operating activities. As of March 31, 2020, our net asset value totaled $1,336.2 million, or $20.73 per share.

        The Credit Facility, which provides additional liquidity to support our investment and operational activities, was amended in March 2020 to provide for an increase in total commitments from $705.0 million to $740.0 million and to increase the diversified group of lenders to 18 lenders. The Credit Facility matures in September 2023 and contains an accordion feature which allows us to increase the total commitments under the facility to up to $800.0 million from new and existing lenders on the same terms and conditions as the existing commitments. Borrowings under the Credit Facility bear interest, subject to our election and resetting on a monthly basis on the first of each month, on a per annum basis at a rate equal to the applicable LIBOR rate (1.0% as of March 31, 2020) plus (i) 1.875% (or the applicable base rate (Prime Rate of 3.25% as of March 31, 2020) plus 0.875%) as long as we meet certain agreed upon excess collateral and maximum leverage requirements or (ii) 2.0% (or the applicable base rate plus 1.0%) otherwise. We pay unused commitment fees of 0.25% per annum on the unused lender commitments under the Credit Facility. The Credit Facility is secured by a first lien on the assets of MSCC and its subsidiaries, excluding the equity ownership or assets of the Funds and the External Investment Manager. The Credit Facility contains certain affirmative and negative covenants, including but not limited to: (i) maintaining a minimum availability of at least 10% of the borrowing base, (ii) maintaining an interest coverage ratio of at least 2.0 to 1.0, (iii) maintaining an asset coverage ratio (tangible net worth to Credit Facility borrowings) of at least 1.5 to 1.0 and (iv) maintaining a minimum tangible net worth. The Credit Facility is provided on a revolving basis through its final maturity date in September 2023, and contains two, one-year extension options which could extend the final maturity by up to two years, subject to certain conditions, including lender approval. As of March 31, 2020, we had $277.0 million in borrowings outstanding under the Credit Facility, the interest rate on the Credit Facility was 3.5% (based on the LIBOR rate of 1.6% as of the most recent reset date of March 1, 2020 plus 1.875%) and we were in compliance with all financial covenants of the Credit Facility.

        Through the Funds, we have the ability to issue SBIC debentures guaranteed by the SBA at favorable interest rates and favorable terms and conditions. Under existing SBIC regulations, SBA-approved SBICs under common control have the ability to issue debentures guaranteed by the SBA up to a regulatory maximum amount of $350.0 million. Under existing SBA-approved commitments, we had $304.8 million of outstanding SBIC debentures guaranteed by the SBA as of

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March 31, 2020 through our wholly owned SBICs, which bear a weighted-average annual fixed interest rate of approximately 3.5%, paid semiannually, and mature ten years from issuance. The first maturity related to our SBIC debentures occurs in 2020, and the weighted-average remaining duration is approximately 5.4 years as of March 31, 2020. During the three months ended March 31, 2020, Main Street issued $15.0 million of SBIC debentures and opportunistically prepaid $22.0 million of existing SBIC debentures that were scheduled to mature over the next year as part of an effort to manage the maturity dates of the oldest SBIC debentures. Subsequent to March 31, 2020, we received an additional commitment from the SBA enabling us to issue new SBIC debentures in the future, increasing our total commitment from the SBA to the regulatory maximum of $350.0 million. Debentures guaranteed by the SBA have fixed interest rates that equal prevailing 10-year Treasury Note rates plus a market spread and have a maturity of ten years with interest payable semiannually. The principal amount of the debentures is not required to be paid before maturity, but may be pre-paid at any time with no prepayment penalty. We expect to issue new SBIC debentures under the SBIC program in the future in an amount up to the regulatory maximum amount for affiliated SBIC funds.

        In November 2014, we issued $175.0 million in aggregate principal amount of 4.50% unsecured notes due 2019 (the "4.50% Notes due 2019") at an issue price of 99.53%. The 4.50% Notes due 2019 bore interest at a rate of 4.50% per year payable semiannually on June 1 and December 1 of each year. On December 2, 2019, we repaid the entire principal amount of the issued and outstanding 4.50% Notes due 2019, effective December 1, 2019 (the "Maturity Date"), at par value plus the accrued and unpaid interest thereon from June 1, 2019 through the Maturity Date.

        In November 2017, we issued $185.0 million in aggregate principal amount of 4.50% unsecured notes due December 1, 2022 (the "4.50% Notes due 2022") at an issue price of 99.16%. The 4.50% Notes due 2022 are unsecured obligations and rank pari passu with our current and future unsecured indebtedness; senior to any of our future indebtedness that expressly provides it is subordinated to the 4.50% Notes due 2022; effectively subordinated to all of our existing and future secured indebtedness, to the extent of the value of the assets securing such indebtedness, including borrowings under our Credit Facility; and structurally subordinated to all existing and future indebtedness and other obligations of any of our subsidiaries, including without limitation, the indebtedness of the Funds. The 4.50% Notes due 2022 may be redeemed in whole or in part at any time at our option subject to certain make-whole provisions. The 4.50% Notes due 2022 bear interest at a rate of 4.50% per year payable semiannually on June 1 and December 1 of each year. We may from time to time repurchase 4.50% Notes due 2022 in accordance with the 1940 Act and the rules promulgated thereunder. As of March 31, 2020, the outstanding balance of the 4.50% Notes due 2022 was $185.0 million.

        The indenture governing the 4.50% Notes due 2022 (the "4.50% Notes due 2022 Indenture") contains certain covenants, including covenants requiring our compliance with (regardless of whether we are subject to) the asset coverage requirements set forth in Section 18(a)(1)(A) as modified by Section 61(a)(1) of the 1940 Act, as well as covenants requiring us to provide financial information to the holders of the 4.50% Notes due 2022 and the Trustee if we cease to be subject to the reporting requirements of the Exchange Act. These covenants are subject to limitations and exceptions that are described in the 4.50% Notes due 2022 Indenture.

        In April 2019, we issued $250.0 million in aggregate principal amount of 5.20% unsecured Notes due May 1, 2024 (the "5.20% Notes") at an issue price of 99.125%. Subsequently, in December 2019, we issued an additional $75.0 million of the 5.20% Notes at an issue price of 105.0%. The 5.20% Notes issued in December 2019 have identical terms as, and are a part of a single series with, the 5.20% Notes issued in April 2019. The aggregate net proceeds from the 5.20% Notes issuances were used to repay a portion of the borrowings outstanding under the Credit Facility. The 5.20% Notes are unsecured obligations and rank pari passu with our current and future unsecured indebtedness; senior to any of our future indebtedness that expressly provides it is subordinated to the 5.20% Notes; effectively subordinated to all of our existing and future secured indebtedness, to the extent of the

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value of the assets securing such indebtedness, including borrowings under our Credit Facility; and structurally subordinated to all existing and future indebtedness and other obligations of any of our subsidiaries, including without limitation, the indebtedness of the Funds. The 5.20% Notes may be redeemed in whole or in part at any time at our option subject to certain make-whole provisions. As of March 31, 2020, the outstanding balance of the 5.20% Notes was $325.0 million.

        The indenture governing the 5.20% Notes (the "5.20% Notes Indenture") contains certain covenants, including covenants requiring our compliance with (regardless of whether we are subject to) the asset coverage requirements set forth in Section 18(a)(1)(A) as modified by Section 61(a)(1) of the 1940 Act, as well as covenants requiring us to provide financial information to the holders of the 5.20% Notes and the Trustee if we cease to be subject to the reporting requirements of the Exchange Act. These covenants are subject to limitations and exceptions that are described in the 5.20% Notes Indenture.

        We maintain a program with certain selling agents through which we can sell shares of our common stock by means of at-the-market offerings from time to time (the "ATM Program"). During the three months ended March 31, 2020, we sold 87,500 shares of our common stock at a weighted-average price of $43.39 per share and raised $3.8 million of gross proceeds under the ATM Program. Net proceeds were $3.7 million after commissions to the selling agents on shares sold and offering costs. As of March 31, 2020, there were 8,271,650 shares available for sale under the ATM Program.

        During the year ended December 31, 2019, we sold 2,247,187 shares of our common stock at a weighted-average price of $40.05 per share and raised $90.0 million of gross proceeds under the ATM Program. Net proceeds were $88.8 million after commissions to the selling agents on shares sold and offering costs.

        We anticipate that we will continue to fund our investment activities through existing cash and cash equivalents, cash flows generated through our ongoing operating activities, utilization of available borrowings under our Credit Facility, and a combination of future issuances of debt and equity capital. Our primary uses of funds will be investments in portfolio companies, operating expenses and cash distributions to holders of our common stock.

        We periodically invest excess cash balances into marketable securities and idle funds investments. The primary investment objective of marketable securities and idle funds investments is to generate incremental cash returns on excess cash balances prior to utilizing those funds for investment in our LMM, Middle Market and Private Loan portfolio investments. Marketable securities and idle funds investments generally consist of debt investments, independently rated debt investments, certificates of deposit with financial institutions, diversified bond funds and publicly traded debt and equity investments.

        If our common stock trades below our net asset value per share, we will generally not be able to issue additional common stock at the market price, unless our stockholders approve such a sale and our Board of Directors makes certain determinations. We did not seek stockholder authorization to sell shares of our common stock below the then current net asset value per share of our common stock at our 2020 annual meeting of stockholders because our common stock price per share has generally traded significantly above the net asset value per share of our common stock since 2011. We would therefore need future approval from our stockholders to issue shares below the then current net asset value per share.

        In order to satisfy the Code requirements applicable to a RIC, we intend to distribute to our stockholders, after consideration and application of our ability under the Code to carry forward certain excess undistributed taxable income from one tax year into the next tax year, substantially all of our taxable income. In addition, as a BDC, we generally are required to meet a coverage ratio of total assets to total senior securities, which include borrowings and any preferred stock we may issue in the

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future, of at least 200% (or 150% if certain requirements are met). This requirement limits the amount that we may borrow. In January 2008, we received an exemptive order from the SEC to exclude SBA-guaranteed debt securities issued by MSMF and any other wholly owned subsidiaries of ours which operate as SBICs from the asset coverage requirements of the 1940 Act as applicable to us, which, in turn, enables us to fund more investments with debt capital.

        Although we have been able to secure access to additional liquidity, including through the Credit Facility, public debt issuances, leverage available through the SBIC program and equity offerings, there is no assurance that debt or equity capital will be available to us in the future on favorable terms, or at all.

    Recently Issued or Adopted Accounting Standards

        In August 2018, the SEC adopted rules (the "SEC Release") amending certain disclosure requirements intended to eliminate redundant, duplicative, overlapping, outdated or superseded, in light of other SEC disclosure requirements, U.S. GAAP requirements or changes in the information environment. In part, the SEC Release requires an investment company to present distributable earnings in total on the consolidated balance sheet and consolidated statements of changes in net assets, rather than showing the three components of distributable earnings as previously shown. We adopted this part of the SEC Release during the year ended December 31, 2018. The impact of the adoption of these rules on our consolidated financial statements was not material. Additionally, the SEC Release requires disclosure of changes in net assets within a registrant's Form 10-Q filing on a quarter-to-date and year-to-date basis for both the current year and prior year comparative periods. We adopted the new requirement to present changes in net assets in interim financial statements within Form 10-Q filings effective January 1, 2019. The adoption of these rules did not have a material impact on the consolidated financial statements.

        In March 2020, the FASB issued ASU 2020-04, "Reference rate reform (Topic 848)—Facilitation of the effects of reference rate reform on financial reporting." The amendments in this update provide optional expedients and exceptions for applying U.S. GAAP to certain contracts and hedging relationships that reference LIBOR or another reference rate expected to be discontinued due to reference rate reform and became effective upon issuance for all entities. We have agreements that have LIBOR as a reference rate with certain portfolio companies and also with certain lenders. Many of these agreements include language for choosing an alternative successor rate if LIBOR reference is no longer considered to be appropriate. Contract modifications are required to be evaluated in determining whether the modifications result in the establishment of new contracts or the continuation of existing contracts. We adopted this amendment in March 2020 and plan to apply the amendments in this update to account for contract modifications due to changes in reference rates. We do not believe that it will have a material impact on its consolidated financial statements and disclosures.

        From time to time, new accounting pronouncements are issued by the FASB or other standards setting bodies that are adopted by us as of the specified effective date. We believe that the impact of recently issued standards and any that are not yet effective will not have a material impact on our consolidated financial statements upon adoption.

    Inflation

        Inflation has not had a significant effect on our results of operations in any of the reporting periods presented herein. However, our portfolio companies have experienced, and may in the future experience, the impacts of inflation on their operating results, including periodic escalations in their costs for labor, raw materials and third-party services and required energy consumption.

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    Off-Balance Sheet Arrangements

        We may be a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financial needs of our portfolio companies. These instruments include commitments to extend credit and fund equity capital and involve, to varying degrees, elements of liquidity and credit risk in excess of the amount recognized in the balance sheet. At March 31, 2020, we had a total of $99.6 million in outstanding commitments comprised of (i) thirty-nine investments with commitments to fund revolving loans that had not been fully drawn or term loans with additional commitments not yet funded and (ii) nine investments with equity capital commitments that had not been fully called.

    Contractual Obligations

        As of March 31, 2020, the future fixed commitments for cash payments in connection with our SBIC debentures, the 4.50% Notes due 2022, the 5.20% Notes and rent obligations under our office lease for each of the next five years and thereafter are as follows:

 
   2020   2021   2022   2023   2024   Thereafter   Total  

SBIC debentures

   $ 20,000   $ 40,000   $ —   $ 16,000   $ 63,800   $ 165,000   $ 304,800  

Interest due on SBIC debentures

     5,456     9,487     8,475     8,220     6,772     18,840     57,250  

4.50% Notes due 2022

     —     —     185,000     —     —     —     185,000  

Interest due on 4.50% Notes due 2022

     8,325     8,325     8,325     —     —     —     24,975  

5.20% Notes due 2024

     —     —     —     —     —     325,000     325,000  

Interest due on 5.20% Notes

     16,900     16,900     16,900     16,900     8,450     —     76,050  

Operating Lease Obligation(1)

     572     776     790     804     818     2,611     6,371  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Total

   $ 51,253   $ 75,488   $ 219,490   $ 41,924   $ 79,840   $ 511,451   $ 979,446  
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
(1)
Operating Lease Obligation means a rent payment obligation under a lease classified as an operating lease and disclosed pursuant to ASC 842, as may be modified or supplemented.

        As of March 31, 2020, we had $277.0 million in borrowings outstanding under our Credit Facility, and the Credit Facility is currently scheduled to mature in September 2023. The Credit Facility contains two, one-year extension options which could extend the maturity to September 2025, subject to lender approval. See further discussion of the Credit Facility terms in "—Liquidity and Capital Resources—Capital Resources."

    Related Party Transactions

        As discussed further above, the External Investment Manager is treated as a wholly owned portfolio company of MSCC and is included as part of our Investment Portfolio. At March 31, 2020, we had a receivable of approximately $2.5 million due from the External Investment Manager, which included approximately $1.9 million primarily related to operating expenses incurred by us as required to support the External Investment Manager's business and amounts due from the External Investment Manager to Main Street under a tax sharing agreement (see further discussion above in "—Critical Accounting Policies—Income Taxes") and approximately $0.7 million of dividends declared but not paid by the External Investment Manager.

        In November 2015, our Board of Directors approved and adopted the Main Street Capital Corporation Deferred Compensation Plan (the "2015 Deferred Compensation Plan"). The 2015 Deferred Compensation Plan became effective on January 1, 2016 and replaced the Deferred Compensation Plan for Non-Employee Directors previously adopted by the Board of Directors in June 2013 (the "2013 Deferred Compensation Plan"). Under the 2015 Deferred Compensation Plan,

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non-employee directors and certain key employees may defer receipt of some or all of their cash compensation and directors' fees, subject to certain limitations. Individuals participating in the 2015 Deferred Compensation Plan receive distributions of their respective balances based on predetermined payout schedules or other events as defined by the plan and are also able to direct investments made on their behalf among investment alternatives permitted from time to time under the plan, including phantom Main Street stock units. As of March 31, 2020, $8.9 million of compensation and directors' fees had been deferred under the 2015 Deferred Compensation Plan (including amounts previously deferred under the 2013 Deferred Compensation Plan). Of this amount, $4.2 million was deferred into phantom Main Street stock units, representing 120,101 shares of our common stock. Including phantom stock units issued through dividend reinvestment and net of any shares distributed, the phantom stock units outstanding as of March 31, 2020 represented 154,334 shares of our common stock. Any amounts deferred under the plan represented by phantom Main Street stock units will not be issued or included as outstanding on the consolidated statements of changes in net assets until such shares are actually distributed to the participant in accordance with the plan, but the related phantom stock units are included in weighted-average shares outstanding with the related dollar amount of the deferral included in total expenses in Main Street's consolidated statements of operations as earned. The dividend amounts related to additional phantom stock units are included in the statement of changes in net assets as an increase to dividends to stockholders offset by a corresponding increase to additional paid-in capital.

    Recent Developments

        During May 2020, we declared regular monthly dividends of $0.205 per share for each month of July, August and September of 2020. These regular monthly dividends equal a total of $0.615 per share for the third quarter of 2020, unchanged from the regular monthly dividends paid in the third quarter of 2019. Including the regular monthly dividends declared for the second and third quarters of 2020, we will have paid $28.985 per share in cumulative dividends since our October 2007 initial public offering.

        In April 2020, we led a new portfolio investment to facilitate the recapitalization of Pearl Meyer & Partners ("Pearl Meyer"), an independent provider of executive compensation consulting services, benchmarking data and surveys. We partnered with Pearl Meyer's senior management team to facilitate the recapitalization and provide additional capital to the business as it executes on its consolidation strategy in the fragmented executive compensation advisory segment. We invested $48.8 million in the recapitalization, consisting of a $35.0 million term loan and a $13.8 million preferred equity investment.

        We continue to work collectively with our employees and portfolio companies to navigate the significant challenges created by the ongoing COVID-19 pandemic beginning in the first quarter of 2020. Our business and operating results, and the businesses and operating results of our portfolio companies, have been significantly impacted by COVID-19. Due to the challenges and uncertainty created by COVID-19, we suspended our future semi-annual supplemental dividends, specifically including the supplemental dividend that we previously expected to pay in June 2020. We believe that it is in the best long-term interests of our stockholders to not only maintain a conservative approach to our dividend policy during this volatile economic environment, but to also ensure we have the ability to be opportunistic in funding attractive investments that have the potential to provide long-term value to our stockholders.

Item 3.    Quantitative and Qualitative Disclosures about Market Risk

        We are subject to financial market risks, including changes in interest rates, and changes in interest rates may affect both our interest expense on the debt outstanding under our Credit Facility and our interest income from portfolio investments. Our risk management systems and procedures are designed to identify and analyze our risk, to set appropriate policies and limits and to continually monitor these risks. Our investment income will be affected by changes in various interest rates, including LIBOR and

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prime rates, to the extent that any debt investments include floating interest rates. See "Risk Factors—Risks Relating to Our Business and Structure—The interest rates of our floating-rate loans to our portfolio companies and for any of our borrowings that extend beyond 2021 might be subject to change based on recent regulatory changes" included in our Form 10-K for the fiscal year ended December 31, 2019 for more information regarding risks associated with our debt investments and borrowings that utilize LIBOR as a reference rate.

        The majority of our debt investments are made with either fixed interest rates or floating rates that are subject to contractual minimum interest rates for the term of the investment. As of March 31, 2020, approximately 73% of our debt investment portfolio (at cost) bore interest at floating rates, 84% of which were subject to contractual minimum interest rates. Our interest expense will be affected by changes in the published LIBOR rate in connection with our Credit Facility; however, the interest rates on our outstanding SBIC debentures, 4.50% Notes due 2022 and 5.20% Notes, which collectively comprise the majority of our outstanding debt, are fixed for the life of such debt. As of March 31, 2020, we had not entered into any interest rate hedging arrangements. Due to our limited use of derivatives, we have claimed an exclusion from the definition of the term "commodity pool operator" under the Commodity Exchange Act and, therefore, are not subject to registration or regulation as a pool operator under such Act. The following table shows the approximate annualized increase or decrease in the components of net investment income due to hypothetical base rate changes in interest rates, assuming no changes in our investments and borrowings as of March 31, 2020.

Basis Point Change
  Increase
(Decrease)
in Interest
Income 		  (Increase)
Decrease
in Interest
Expense 		  Increase
(Decrease) in Net
Investment
Income 		  Increase
(Decrease) in Net
Investment
Income per
Share 		 
 
   (dollars in thousands, except per
share amounts)
    
  

(150)

   $ (5,814 ) $ 2,750   $ (3,064 ) $ (0.05 )

(125)

     (5,567 )   2,750     (2,817 )   (0.04 )

(100)

     (5,259 )   2,750     (2,509 )   (0.04 )

(75)

     (4,637 )   2,078     (2,559 )   (0.04 )

(50)

     (4,000 )   1,385     (2,615 )   (0.04 )

(25)

     (2,171 )   693     (1,478 )   (0.02 )

25

     3,150     (693 )   2,457     0.04  

50

     6,438     (1,385 )   5,053     0.08  

75

     9,761     (2,078 )   7,683     0.12  

100

     13,108     (2,770 )   10,338     0.16  

125

     16,542     (3,463 )   13,079     0.20  

150

     19,979     (4,155 )   15,824     0.25  

        The hypothetical results assume that all LIBOR and prime rate changes would be effective on the first day of the period. However, the contractual LIBOR and prime rate reset dates would vary throughout the period, on either a monthly or quarterly basis, for both our investments and our Credit Facility. The hypothetical results would also be impacted by the changes in the amount of debt outstanding under our Credit Facility (with an increase (decrease) in the debt outstanding under the Credit Facility resulting in an (increase) decrease in the hypothetical interest expense).

Item 4.    Controls and Procedures

        As of the end of the period covered by this report, we carried out an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer, President, Chief Financial Officer, Chief Compliance Officer and Chief Accounting Officer, of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in

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Rule 13a-15 of the Exchange Act). Based on that evaluation, our Chief Executive Officer, President, Chief Financial Officer, Chief Compliance Officer and Chief Accounting Officer have concluded that our current disclosure controls and procedures are effective in timely alerting them of material information relating to us that is required to be disclosed in the reports we file or submit under the Exchange Act. There have been no changes in our internal control over financial reporting that occurred during the quarter ended March 31, 2020 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II—OTHER INFORMATION

Item 1.    Legal Proceedings

        We may, from time to time, be involved in litigation arising out of our operations in the normal course of business or otherwise. Furthermore, third parties may seek to impose liability on us in connection with the activities of our portfolio companies. While the outcome of any current legal proceedings cannot at this time be predicted with certainty, we do not expect any current matters will materially affect our financial condition or results of operations; however, there can be no assurance whether any pending legal proceedings will have a material adverse effect on our financial condition or results of operations in any future reporting period.

Item 1A.    Risk Factors

        You should carefully consider the risks described below and all other information contained in this Quarterly Report on Form 10-Q, including our interim financial statements and the related notes thereto, before making a decision to purchase our securities. The risks and uncertainties described below are not the only ones facing us. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may have a material adverse effect on our business, financial condition and/or operating results, as well as the market price of our securities.

        In addition to the other information set forth in this report, you should carefully consider the risk factors previously disclosed in our Annual Report on Form 10-K for the year ended December 31, 2019 that we filed with the SEC on February 28, 2020, which could materially affect our business, financial condition or operating results.

Events outside of our control, including public health crises, could negatively affect our portfolio companies and our results of operations.

        Periods of market volatility have occurred and could continue to occur in response to pandemics or other events outside of our control. These types of events have adversely affected, and could continue to adversely affect, operating results for us and for our portfolio companies. For example, the COVID-19 pandemic has led to, and for an unknown period of time will continue to lead to, disruptions in local, regional, national and global markets and economies affected thereby, including the United States. With respect to U.S. and global credit markets and the economy in general, this outbreak has resulted in, and until fully resolved is likely to continue to result in, the following (among other things): (i) restrictions on travel and the temporary closure of many corporate offices, retail stores and manufacturing facilities and factories, resulting in significant disruption to the business of many companies, including supply chains and demand, as well as layoffs of employees; (ii) increased draws by borrowers on revolving lines of credit; (iii) increased requests by borrowers for amendments or waivers of their credit agreements to avoid default, increased defaults by borrowers and/or increased difficulty in obtaining refinancing; (iv) volatility in credit markets, including greater volatility in pricing and spreads; and (v) rapidly evolving proposals and actions by state and federal governments to address the problems being experienced by markets, businesses and the economy in general, which may not adequately address the problems being faced. The pandemic is having, and any future continuation of the pandemic could have, an adverse impact on the markets and the economy in general.

        Although it is impossible to predict the precise nature and consequences of these events, or of any political or policy decisions and regulatory changes occasioned by emerging events or uncertainty on applicable laws or regulations that impact us and our portfolio companies and investments, it is clear that these types of events are impacting and will, for at least some time, continue to impact us and our portfolio companies; in many instances the impact will be adverse and material. Any potential impact to our results of operations will depend to a large extent on future developments and new information that could emerge regarding the duration and severity of the COVID-19 pandemic and the actions

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taken by authorities and other entities to contain the spread or treat its impact, all of which are beyond our control. These potential impacts, while uncertain, could adversely affect our and our portfolio companies' operating results and financial condition.

        The COVID-19 pandemic and the related disruption and financial distress experienced by our portfolio companies may have material adverse effects on our financial results, including interest income received from our investments and the underlying value of those investments. We may need to restructure our investments in certain portfolio companies as a result of the adverse effects of the COVID-19 pandemic, which could reduce the amount or extend the time for payment of principal or reduce the rate or extend the time of payment of interest, among other things. In addition, if an investment included in the borrowing base for the Credit Facility is deemed to have a material impairment or loss, or if we modify the terms of an investment included in the borrowing base for the Credit Facility, it may reduce the value of the borrowing base, which may have a material adverse effect on our available liquidity, results of operations and financial condition. In addition, any decreases in our net investment income would impact the portion of our cash flows dedicated to servicing existing borrowings under the Credit Facility, the 4.50% Notes due 2022 and the 5.20% Notes and dividends to stockholders. Depending on the duration of the COVID-19 pandemic and the extent of its effects on our portfolio companies' operations and our operating results, any future dividends to our stockholders may be for amounts less than our historical dividends, may be made less frequently than historical practices and may also include return of capital.

        The 1940 Act generally prohibits us, as a BDC, from incurring indebtedness unless immediately after such borrowing we have an asset coverage, as defined in the 1940 Act, of at least 200% (or 150% if certain requirements are met). In addition, the Credit Facility and the indentures governing the 4.50% Notes due 2022 and the 5.20% Notes contain similar limitations or covenants requiring our compliance with the 1940 Act asset coverage requirements, and the Credit Facility also contains other affirmative and negative covenants. A continued significant decrease in the value of our Investment Portfolio, resulting in significant further reductions of our net asset value as a result of the effects of the COVID-19 pandemic or otherwise increases the risk of us not meeting the required asset coverage requirement under the 1940 Act or breaching covenants under the Credit Facility or under the indentures governing the 4.50% Notes due 2022 and the 5.20% Notes. Any such result could have a material adverse effect on our business, liquidity, financial condition, results of operations and ability to pay dividends to our stockholders and attributes thereof.

We are currently operating in a period of capital markets disruption and economic uncertainty.

        The U.S. capital markets have experienced extreme volatility and disruption following the global outbreak of COVID-19 that began in December 2019. Some economists and major investment banks have expressed concern that the continued spread of the virus globally could lead to a world-wide economic downturn. Disruptions in the capital markets have increased the spread between the yields realized on risk-free and higher risk securities, resulting in illiquidity in parts of the capital markets. These and future market disruptions and/or illiquidity would be expected to have an adverse effect on our business, financial condition, results of operations and cash flows. Unfavorable economic conditions also would be expected to increase our funding costs, limit our access to the capital markets or result in a decision by lenders not to extend credit to us. These events could limit our investment originations, limit our ability to grow and have a material negative impact on our operating results and the fair values of our debt and equity investments.

Item 2.    Unregistered Sales of Equity Securities and Use of Proceeds

        During the three months ended March 31, 2020, we issued 108,722 shares of our common stock under our dividend reinvestment plan. These issuances were not subject to the registration requirements of the Securities Act of 1933, as amended. The aggregate value of the shares of common

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stock issued during the three months ended March 31, 2020 under the dividend reinvestment plan was approximately $3.9 million.

        Upon vesting of restricted stock awarded pursuant to our employee equity compensation plan, shares may be withheld to meet applicable tax withholding requirements. Any withheld shares are treated as common stock purchases by the Company in our consolidated financial statements as they reduce the number of shares received by employees upon vesting (see "Purchase of vested stock for employee payroll tax withholding" in the consolidated statements of changes in net assets for share amounts withheld).

Item 6.    Exhibits

        Listed below are the exhibits which are filed as part of this report (according to the number assigned to them in Item 601 of Regulation S-K):

Exhibit
Number 		  Description of Exhibit
  10.1 * Supplement Agreement dated March 23, 2020 (previously filed as Exhibit 10.1 to Main Street Capital Corporation's Current Report on Form 8-K filed on March 24, 2020 (File No. 1-33723)).

 
31.1
 
Certification of Chief Executive Officer Pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934.

 
31.2
 
Certification of Chief Financial Officer Pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934.

 
32.1
 
Certification of Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350).

 
32.2
 
Certification of Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350).
*
Exhibit previously filed with the Securities and Exchange Commission, as indicated, and incorporated herein by reference.

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SIGNATURES

        Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

    Main Street Capital Corporation

Date: May 8, 2020
 
/s/ DWAYNE L. HYZAK
 Dwayne L. Hyzak
 Chief Executive Officer
(principal executive officer)

Date: May 8, 2020
 
/s/ BRENT D. SMITH
 Brent D. Smith
 Chief Financial Officer and Treasurer
(principal financial officer)

Date: May 8, 2020
 
/s/ LANCE A. PARKER
 Lance A. Parker
 Vice President and Chief Accounting Officer
(principal accounting officer)

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