Main Street Capital CORP - Quarter Report: 2022 June (Form 10-Q)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q


(Mark One)
☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2022
OR
☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from: to

Commission File Number: 001-33723

Main Street Capital Corporation

(Exact name of registrant as specified in its charter)


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

(713) 350-6000

(Registrant’s telephone number including area code)

n/a

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

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 ☒ No ☐

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 ☐ No ☐

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 ☒	Accelerated filer ☐	Non-accelerated filer ☐	Smaller reporting company ☐ Emerging growth company ☐

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. ☐

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

The number of shares outstanding of the issuer’s common stock as of August 4, 2022 was 73,905,636.

Table of Contents

TABLE OF CONTENTS


	PART I
	FINANCIAL INFORMATION
Item 1.	Consolidated Financial Statements
	Consolidated Balance Sheets—June 30, 2022 (unaudited) and December 31, 2021	1
	Consolidated Statements of Operations (unaudited)—Three and six months ended June 30, 2022 and 2021	2
	Consolidated Statements of Changes in Net Assets (unaudited)—Six months ended June 30, 2022 and 2021	3
	Consolidated Statements of Cash Flows (unaudited)—Six months ended June 30, 2022 and 2021	4
	Consolidated Schedule of Investments (unaudited)—June 30, 2022	5
	Consolidated Schedule of Investments—December 31, 2021	28
	Notes to Consolidated Financial Statements (unaudited)	51
	Consolidated Schedules of Investments in and Advances to Affiliates (unaudited)—Six months ended June 30, 2022 and 2021	88
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	99
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	122
Item 4.	Controls and Procedures	122
	PART II
	OTHER INFORMATION
Item 1.	Legal Proceedings	123
Item 1A.	Risk Factors	123
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	123
Item 6.	Exhibits	124
	Signatures	125

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Balance Sheets

(in thousands, except shares and per share amounts)


	June 30,		December 31,
	2022		2021
	(Unaudited)
ASSETS
Investments at fair value:
Control investments (cost: $1,145,692 and $1,107,597 as of June 30, 2022 and December 31, 2021, respectively)	$	1,538,158	$	1,489,257
Affiliate investments (cost: $540,457 and $578,539 as of June 30, 2022 and December 31, 2021, respectively)		518,061		549,214
Non‑Control/Non‑Affiliate investments (cost: $1,737,243 and $1,573,110 as of June 30, 2022 and December 31, 2021, respectively)		1,661,551		1,523,360
Total investments (cost: $3,423,392 and $3,259,246 as of June 30, 2022 and December 31, 2021, respectively)		3,717,770		3,561,831
Cash and cash equivalents		43,383		32,629
Interest and dividend receivable and other assets		59,421		56,488
Receivable for securities sold		1,441		35,125
Deferred financing costs (net of accumulated amortization of $9,948 and $9,462 as of June 30, 2022 and December 31, 2021, respectively)		3,730		4,217
Total assets	$	3,825,745	$	3,690,290
LIABILITIES
Credit facility	$	380,000	$	320,000
3.00% Notes due 2026 (par: $500,000 as of both June 30, 2022 and December 31, 2021)		497,872		497,609
5.20% Notes due 2024 (par: $450,000 as of both June 30, 2022 and December 31, 2021)		450,999		451,272
SBIC debentures (par: $350,000 as of both June 30, 2022 and December 31, 2021)		343,323		342,731
4.50% Notes due 2022 (par: $185,000 as of both June 30, 2022 and December 31, 2021)		184,747		184,444
Accounts payable and other liabilities		29,978		40,469
Payable for securities purchased		—		5,111
Interest payable		14,968		14,926
Dividend payable		15,673		15,159
Deferred tax liability, net		43,022		29,723
Total liabilities		1,960,582		1,901,444
Commitments and contingencies (Note K)
NET ASSETS
Common stock, $0.01 par value per share (150,000,000 shares authorized; 73,455,801 and 70,700,885 shares issued and outstanding as of June 30, 2022 and December 31, 2021, respectively)		735		707
Additional paid‑in capital		1,837,305		1,736,346
Total undistributed earnings		27,123		51,793
Total net assets		1,865,163		1,788,846
Total liabilities and net assets	$	3,825,745	$	3,690,290
NET ASSET VALUE PER SHARE	$	25.37	$	25.29

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

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Statements of Operations

(in thousands, except shares and per share amounts)

(Unaudited)


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2022		2021		2022		2021
INVESTMENT INCOME:
Interest, fee and dividend income:
Control investments	$	36,808	$	27,027	$	69,385	$	51,052
Affiliate investments		11,893		11,005		25,810		22,511
Non‑Control/Non‑Affiliate investments		36,499		29,262		69,401		56,539
Total investment income		85,200		67,294		164,596		130,102
EXPENSES:
Interest		(17,295)		(14,400)		(33,982)		(28,206)
Compensation		(8,807)		(6,895)		(16,076)		(13,216)
General and administrative		(4,238)		(3,417)		(7,464)		(6,392)
Share‑based compensation		(3,596)		(2,759)		(6,414)		(5,092)
Expenses allocated to the External Investment Manager		3,462		2,572		6,279		4,952
Total expenses		(30,474)		(24,899)		(57,657)		(47,954)
NET INVESTMENT INCOME		54,726		42,395		106,939		82,148
NET REALIZED GAIN (LOSS):
Control investments		—		(2,320)		—		(13,245)
Affiliate investments		47		13,913		739		9,110
Non‑Control/Non‑Affiliate investments		(5,111)		6,407		(2,467)		6,405
Total net realized gain (loss)		(5,064)		18,000		(1,728)		2,270
NET UNREALIZED APPRECIATION (DEPRECIATION):
Control investments		4,822		30,824		13,101		45,084
Affiliate investments		1,731		9,816		4,772		16,232
Non‑Control/Non‑Affiliate investments		(31,146)		3,801		(27,714)		17,124
Total net unrealized appreciation (depreciation)		(24,593)		44,441		(9,841)		78,440
INCOME TAXES:
Federal and state income, excise and other taxes		(809)		(656)		(2,118)		(1,289)
Deferred taxes		(9,511)		(9,070)		(13,299)		(9,118)
Income tax benefit (provision)		(10,320)		(9,726)		(15,417)		(10,407)
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	14,749	$	95,110	$	79,953	$	152,451
NET INVESTMENT INCOME PER SHARE—BASIC AND DILUTED	$	0.75	$	0.62	$	1.47	$	1.20
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS PER SHARE—BASIC AND DILUTED	$	0.20	$	1.39	$	1.10	$	2.23
WEIGHTED AVERAGE SHARES OUTSTANDING—BASIC AND DILUTED		73,304,619		68,514,683		72,512,793		68,321,701

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

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Statements of Changes in Net Assets

(in thousands, except shares)

(Unaudited)


						Total
	Common Stock			Additional		Undistributed
	Number of	Par		Paid‑In		(Overdistributed)		Total Net
	Shares	Value		Capital		Earnings		Asset Value
Balances at December 31, 2020	67,762,032	$	677	$	1,615,940	$	(101,850)	$	1,514,767
Public offering of common stock, net of offering costs	117,388		2		3,626		—		3,628
Share‑based compensation	—		—		2,333		—		2,333
Purchase of vested stock for employee payroll tax withholding	(180)		—		(7)		—		(7)
Dividend reinvestment	106,651		1		3,698		—		3,699
Amortization of directors’ deferred compensation	—		—		195		—		195
Issuance of restricted stock	15,007		—		—		—		—
Dividends to stockholders	—		—		96		(41,893)		(41,797)
Net increase resulting from operations	—		—		—		57,346		57,346
Balances at March 31, 2021	68,000,898	$	680	$	1,625,881	$	(86,397)	$	1,540,164
Public offering of common stock, net of offering costs	231,795		2		9,396		—		9,398
Share‑based compensation	—		—		2,759		—		2,759
Purchase of vested stock for employee payroll tax withholding	(114,357)		(1)		(4,464)		—		(4,465)
Dividend reinvestment	91,632		1		3,755		—		3,756
Amortization of directors’ deferred compensation	—		—		163		—		163
Issuance of restricted stock, net of forfeited shares	321,821		3		(3)		—		—
Dividends to stockholders	—		—		96		(42,140)		(42,044)
Net increase resulting from operations	—		—		—		95,110		95,110
Balances at June 30, 2021	68,531,789	$	685	$	1,637,583	$	(33,427)	$	1,604,841

Balances at December 31, 2021	70,737,021	$	707	$	1,736,346	$	51,793	$	1,788,846
Public offering of common stock, net of offering costs	1,502,430		15		63,507		—		63,522
Share‑based compensation	—		—		2,818		—		2,818
Dividend reinvestment	114,043		1		4,812		—		4,813
Amortization of directors’ deferred compensation	—		—		147		—		147
Issuance of restricted stock, net of forfeited shares	16,913		—		—		—		—
Dividends to stockholders	—		—		109		(51,804)		(51,695)
Net increase resulting from operations	—		—		—		65,203		65,203
Balances at March 31, 2022	72,370,407	$	723	$	1,807,739	$	65,192	$	1,873,654
Public offering of common stock, net of offering costs	662,828		7		25,626		—		25,633
Share‑based compensation	—		—		3,596		—		3,596
Purchase of vested stock for employee payroll tax withholding	(115,071)		(1)		(4,894)		—		(4,895)
Dividend reinvestment	132,156		1		4,999		—		5,000
Amortization of directors’ deferred compensation	—		—		130		—		130
Issuance of restricted stock, net of forfeited shares	467,238		5		(5)		—		—
Dividends to stockholders	—		—		114		(52,818)		(52,704)
Net increase resulting from operations	—		—		—		14,749		14,749
Balances at June 30, 2022	73,517,558	$	735	$	1,837,305	$	27,123	$	1,865,163

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

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Statements of Cash Flows

(in thousands)

(Unaudited)


	Six Months Ended
	June 30,
	2022		2021
CASH FLOWS FROM OPERATING ACTIVITIES
Net increase in net assets resulting from operations	$	79,953	$	152,451
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		(540,429)		(520,706)
Proceeds from sales and repayments of debt investments in portfolio companies		381,697		279,303
Proceeds from sales and return of capital of equity investments in portfolio companies		30,293		55,915
Net unrealized (appreciation) depreciation		9,841		(78,440)
Net realized (gain) loss		1,728		(2,270)
Accretion of unearned income		(7,354)		(6,391)
Payment-in-kind interest		(2,364)		(4,672)
Cumulative dividends		(1,062)		(858)
Share-based compensation expense		6,414		5,092
Amortization of deferred financing costs		1,372		1,494
Deferred tax (benefit) provision		13,299		9,118
Changes in other assets and liabilities:
Interest and dividend receivable and other assets		(3,686)		(5,047)
Interest payable		42		3,220
Accounts payable and other liabilities		(10,216)		1,234
Deferred fees and other		1,037		2,363
Net cash used in operating activities		(39,435)		(108,194)

CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from public offering of common stock, net of offering costs		89,155		13,026
Proceeds from public offering of 3.00% Notes due 2026		-		300,000
Dividends paid		(94,071)		(76,221)
Proceeds from issuance of SBIC debentures		-		52,200
Repayments of SBIC debentures		-		(40,000)
Proceeds from credit facility		303,000		446,000
Repayments on credit facility		(243,000)		(546,000)
Debt issuance premiums (costs), net		-		(9,462)
Purchases of vested stock for employee payroll tax withholding		(4,895)		(4,472)
Net cash provided by financing activities		50,189		135,071

Net increase in cash and cash equivalents		10,754		26,877
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD		32,629		31,919
CASH AND CASH EQUIVALENTS AT END OF PERIOD	$	43,383	$	58,796

Supplemental cash flow disclosures:
Interest paid	$	32,505	$	23,427
Taxes paid	$	4,920	$	1,609
Non-cash financing activities:
Value of shares issued pursuant to the DRIP	$	9,813	$	7,455

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

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments

June 30, 2022

(dollars in thousands)

(Unaudited)


Portfolio Company (1) (20)		Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate (39)	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)

Control Investments (5)

Analytical Systems Keco Holdings, LLC		Manufacturer of Liquid and Gas Analyzers
			Secured Debt	(9)	8/16/2019		12.00% (L+10.00%, Floor 2.00%)	8/16/2024	$	4,805	$	4,641	$	4,641
			Preferred Member Units		8/16/2019	3,200						3,200		-
			Preferred Member Units		5/20/2021	2,427						2,426		4,318
			Warrants	(27)	8/16/2019	420		8/16/2029				316		-
												10,583		8,959
ASC Interests, LLC		Recreational and Educational Shooting Facility
			Secured Debt		12/31/2019		13.00%	7/31/2024		170		170		170
			Secured Debt		8/1/2013		13.00%	7/31/2024		1,650		1,648		1,648
			Member Units		8/1/2013	1,500						1,500		800
												3,318		2,618
ATS Workholding, LLC	(10)	Manufacturer of Machine Cutting Tools and Accessories
			Secured Debt	(14)	11/16/2017		5.00%	8/16/2023		4,728		4,570		2,939
			Preferred Member Units		11/16/2017	3,725,862						3,726		-
												8,296		2,939
Barfly Ventures, LLC	(10)	Casual Restaurant Group
			Secured Debt		10/15/2020		7.00%	10/31/2024		711		711		711
			Member Units		10/26/2020	37						1,584		2,400
												2,295		3,111
Batjer TopCo, LLC		HVAC Mechanical Contractor
			Secured Debt		3/7/2022		11.00%	3/31/2027		11,025		10,913		10,913
			Preferred Stock		3/7/2022	4,073						4,073		4,073
												14,986		14,986
Bolder Panther Group, LLC		Consumer Goods and Fuel Retailer
			Secured Debt	(9)	12/31/2020		10.50% (L+9.00%, Floor 1.50%)	12/31/2025		49,194		48,920		49,194
			Class B Preferred Member Units	(8)	12/31/2020	140,000	8.00%					14,000		25,930
												62,920		75,124
Brewer Crane Holdings, LLC		Provider of Crane Rental and Operating Services
			Secured Debt	(9)	1/9/2018		11.06% (L+10.00%, Floor 1.00%)	1/9/2023		7,812		7,801		7,801
			Preferred Member Units	(8)	1/9/2018	2,950						4,279		7,050
												12,080		14,851
Bridge Capital Solutions Corporation		Financial Services and Cash Flow Solutions Provider
			Secured Debt		7/25/2016		13.00%	12/11/2024		8,813		8,813		8,813
			Secured Debt	(30)	7/25/2016		13.00%	12/11/2024		1,000		1,000		1,000
			Preferred Member Units	(8) (30)	7/25/2016	17,742						1,000		1,000
			Warrants	(27)	7/25/2016	82		7/25/2026				2,132		4,260
												12,945		15,073
Café Brazil, LLC		Casual Restaurant Group
			Member Units	(8)	6/9/2006	1,233						1,742		2,520

California Splendor Holdings LLC		Processor of Frozen Fruits
			Secured Debt	(9)	3/30/2018		11.00% (L+10.00%, Floor 1.00%)	7/29/2026		28,000		27,944		28,000

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

June 30, 2022

(dollars in thousands)

(Unaudited)


Portfolio Company (1) (20)	Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate (39)	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)
		Preferred Member Units	(8) (19)	7/31/2019	3,671	15.00% PIK					3,713		3,713
		Preferred Member Units	(8)	3/30/2018	6,157						10,775		19,295
											42,432		51,008
CBT Nuggets, LLC	Produces and Sells IT Training Certification Videos
		Member Units	(8)	6/1/2006	416						1,300		47,900

Centre Technologies Holdings, LLC	Provider of IT Hardware Services and Software Solutions
		Secured Debt	(9)	1/4/2019		12.00% (L+10.00%, Floor 2.00%)	1/4/2026		15,030		14,941		14,941
		Preferred Member Units		1/4/2019	13,309						6,122		6,890
											21,063		21,831
Chamberlin Holding LLC	Roofing and Waterproofing Specialty Contractor
		Secured Debt	(9)	2/26/2018		9.13% (L+8.00%, Floor 1.00%)	2/26/2023		17,466		17,422		17,466
		Member Units	(8)	2/26/2018	4,347						11,440		22,510
		Member Units	(8) (30)	11/2/2018	1,047,146						1,322		1,540
											30,184		41,516
Charps, LLC	Pipeline Maintenance and Construction
		Unsecured Debt		8/26/2020		10.00%	1/31/2026		5,694		4,626		5,694
		Preferred Member Units	(8)	2/3/2017	1,829						1,963		13,450
											6,589		19,144
Clad-Rex Steel, LLC	Specialty Manufacturer of Vinyl-Clad Metal
		Secured Debt	(9)	12/20/2016		10.63% (L+9.50%, Floor 1.00%)	1/15/2024		10,480		10,421		10,421
		Secured Debt		12/20/2016		10.00%	12/20/2036		1,065		1,055		1,055
		Member Units	(8)	12/20/2016	717						7,280		10,250
		Member Units	(30)	12/20/2016	800						210		610
											18,966		22,336
CMS Minerals Investments	Oil & Gas Exploration & Production
		Member Units	(8) (30)	4/1/2016	100						1,691		2,274

Cody Pools, Inc.	Designer of Residential and Commercial Pools
		Secured Debt	(9)	3/6/2020		12.25% (L+10.50%, Floor 1.75%)	12/17/2026		41,649		41,315		41,637
		Preferred Member Units	(8) (30)	3/6/2020	587						8,317		51,190
											49,632		92,827
Colonial Electric Company LLC	Provider of Electrical Contracting Services
		Secured Debt		3/31/2021		12.00%	3/31/2026		25,540		25,351		25,351
		Preferred Member Units	(8)	3/31/2021	17,280						7,680		8,940
											33,031		34,291
CompareNetworks Topco, LLC	Internet Publishing and Web Search Portals
		Secured Debt	(9)	1/29/2019		10.13% (L+9.00%, Floor 1.00%)	1/29/2024		5,741		5,726		5,741
		Preferred Member Units	(8)	1/29/2019	1,975						1,975		17,230
											7,701		22,971

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

June 30, 2022

(dollars in thousands)

(Unaudited)


Portfolio Company (1) (20)		Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate (39)	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)
Copper Trail Fund Investments	(12) (13)	Investment Partnership
			LP Interests (CTMH, LP)	(31)	7/17/2017	38.8%						710		710

Datacom, LLC		Technology and Telecommunications Provider
			Secured Debt		3/31/2021		7.50%	12/31/2025		8,757		8,245		7,617
			Preferred Member Units	(8)	3/31/2021	9,000						2,610		2,670
												10,855		10,287
Digital Products Holdings LLC		Designer and Distributor of Consumer Electronics
			Secured Debt	(9)	4/1/2018		11.13% (L+10.00%, Floor 1.00%)	4/1/2023		16,193		16,163		16,163
			Preferred Member Units	(8)	4/1/2018	3,857						9,501		9,835
												25,664		25,998
Direct Marketing Solutions, Inc.		Provider of Omni-Channel Direct Marketing Services
			Secured Debt	(9)	2/13/2018		12.13% (L+11.00%, Floor 1.00%)	2/13/2024		24,678		24,561		24,678
			Preferred Stock	(8)	2/13/2018	8,400						8,400		21,550
												32,961		46,228
Flame King Holdings, LLC		Propane Tank and Accessories Distributor
			Secured Debt	(9)	10/29/2021		7.50% (L+6.50%, Floor 1.00%)	10/31/2026		7,600		7,532		7,600
			Secured Debt	(9)	10/29/2021		12.00% (L+11.00%, Floor 1.00%)	10/31/2026		21,200		21,017		21,200
			Preferred Equity	(8)	10/29/2021	9,360						10,400		13,410
												38,949		42,210
Gamber-Johnson Holdings, LLC		Manufacturer of Ruggedized Computer Mounting Systems
			Secured Debt	(9)	6/24/2016		10.00% (L+8.00%, Floor 2.00%)	1/1/2025		21,598		21,545		21,598
			Member Units	(8)	6/24/2016	9,042						17,692		46,300
												39,237		67,898
Garreco, LLC		Manufacturer and Supplier of Dental Products
			Secured Debt	(9)	7/15/2013		9.00% (L+8.00%, Floor 1.00%, Ceiling 1.50%)	7/31/2023		4,196		4,196		4,196
			Member Units	(8)	7/15/2013	1,200						1,200		2,490
												5,396		6,686
GRT Rubber Technologies LLC		Manufacturer of Engineered Rubber Products
			Secured Debt		12/19/2014		9.06% (L+8.00%)	10/29/2026		38,885		38,694		38,885
			Member Units	(8)	12/19/2014	5,879						13,065		46,190
												51,759		85,075
Gulf Manufacturing, LLC		Manufacturer of Specialty Fabricated Industrial Piping Products
			Member Units	(8)	8/31/2007	438						2,980		5,510

Gulf Publishing Holdings, LLC		Energy Industry Focused Media and Publishing
			Secured Debt	(9) (17) (19)	9/29/2017		10.60% (5.25% Cash, 5.25% PIK)	9/30/2020		257		257		257

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

June 30, 2022

(dollars in thousands)

(Unaudited)


Portfolio Company (1) (20)		Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate (39)	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)
							(L+9.50%, Floor 1.00%)
			Secured Debt	(17) (19)	4/29/2016		12.50% (6.25% Cash, 6.25% PIK)	4/29/2021		13,565		13,565		7,529
			Member Units		4/29/2016	3,681						3,681		-
												17,503		7,786
Harris Preston Fund Investments	(12) (13)	Investment Partnership
			LP Interests (2717 MH, L.P.)	(31)	10/1/2017	49.3%						3,877		6,554
			LP Interests (2717 HPP-MS, L.P.)	(31)	3/11/2022	49.3%						244		244
												4,121		6,798
Harrison Hydra-Gen, Ltd.		Manufacturer of Hydraulic Generators
			Common Stock		6/4/2010	107,456						718		3,330

Jensen Jewelers of Idaho, LLC		Retail Jewelry Store
			Secured Debt	(9)	11/14/2006		10.75% (Prime+6.75%, Floor 2.00%)	11/14/2023		2,450		2,441		2,450
			Member Units	(8)	11/14/2006	627						811		15,120
												3,252		17,570
Johnson Downie Opco, LLC		Executive Search Services
			Secured Debt	(9)	12/10/2021		13.00% (L+11.50%, Floor 1.50%)	12/10/2026		10,437		10,328		10,421
			Preferred Equity	(8)	12/10/2021	3,150						3,150		5,880
												13,478		16,301
JorVet Holdings, LLC		Supplier and Distributor of Veterinary Equipment and Supplies
			Secured Debt		3/28/2022		12.00%	3/28/2027		25,650		25,406		25,406
			Common Stock		3/28/2022	107,406						10,741		10,741
												36,147		36,147
KBK Industries, LLC		Manufacturer of Specialty Oilfield and Industrial Products
			Member Units	(8)	1/23/2006	325						783		13,930

Kickhaefer Manufacturing Company, LLC		Precision Metal Parts Manufacturing
			Secured Debt		10/31/2018		11.50%	10/31/2023		20,415		20,349		20,349
			Secured Debt		10/31/2018		9.00%	10/31/2048		3,897		3,860		3,860
			Member Units		10/31/2018	581						12,240		12,240
			Member Units	(8) (30)	10/31/2018	800						992		2,460
												37,441		38,909
Market Force Information, LLC		Provider of Customer Experience Management Services
			Secured Debt	(9)	7/28/2017		12.13% (L+11.00%, Floor 1.00%)	7/28/2023		4,400		4,400		4,400
			Secured Debt	(14) (19)	7/28/2017		12.00% PIK	7/28/2023		26,079		25,952		7,531
			Member Units		7/28/2017	743,921						16,642		-
												46,994		11,931
MH Corbin Holding LLC		Manufacturer and Distributor of Traffic Safety Products
			Secured Debt	(17)	8/31/2015		13.00%	3/31/2022		8,090		8,090		4,288
			Preferred Member Units		3/15/2019	66,000						4,400		-
			Preferred Member Units		9/1/2015	4,000						6,000		-
												18,490		4,288
MS Private Loan Fund I, LP	(12) (13)	Investment Partnership
			LP Interests	(8) (31)	1/26/2021	14.5%						11,250		10,787

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

June 30, 2022

(dollars in thousands)

(Unaudited)


Portfolio Company (1) (20)		Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate (39)	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)
MSC Adviser I, LLC	(16)	Third Party Investment Advisory Services
			Member Units	(8)	11/22/2013							29,500		118,320

MSC Income Fund, Inc.	(12) (13)	Business Development Company
			Common Equity		5/2/2022	94,697						750		750

Mystic Logistics Holdings, LLC		Logistics and Distribution Services Provider for Large Volume Mailers
			Secured Debt		8/18/2014		10.00%	1/31/2024		6,098		6,098		6,098
			Common Stock	(8)	8/18/2014	5,873						2,720		16,210
												8,818		22,308
NAPCO Precast, LLC		Precast Concrete Manufacturing
			Member Units	(8)	1/31/2008	2,955						2,975		11,830

Nebraska Vet AcquireCo, LLC		Mixed-Animal Veterinary and Animal Health Product Provider
			Secured Debt		12/31/2020		12.00%	12/31/2025		10,500		10,423		10,423
			Secured Debt		12/31/2020		12.00%	12/31/2025		11,452		11,373		11,373
			Preferred Member Units		12/31/2020	6,987						6,987		7,700
												28,783		29,496
NexRev LLC		Provider of Energy Efficiency Products & Services
			Secured Debt		2/28/2018		11.00%	2/28/2025		12,265		12,094		8,262
			Preferred Member Units	(8)	2/28/2018	103,144,186						8,213		940
												20,307		9,202
NRP Jones, LLC		Manufacturer of Hoses, Fittings and Assemblies
			Secured Debt		12/21/2017		12.00%	3/20/2023		2,080		2,080		2,080
			Member Units	(8)	12/22/2011	65,962						3,717		5,470
												5,797		7,550
NuStep, LLC		Designer, Manufacturer and Distributor of Fitness Equipment
			Secured Debt	(9)	1/31/2017		7.63% (L+6.50%, Floor 1.00%)	1/31/2025		3,200		3,200		3,200
			Secured Debt		1/31/2017		12.00%	1/31/2025		18,440		18,408		18,440
			Preferred Member Units		1/31/2017	406						10,200		11,560
												31,808		33,200
OMi Topco, LLC		Manufacturer of Overhead Cranes
			Secured Debt		8/31/2021		12.00%	8/31/2026		16,750		16,610		16,750
			Preferred Member Units	(8)	4/1/2008	900						1,080		20,300
												17,690		37,050
Orttech Holdings, LLC		Distributor of Industrial Clutches, Brakes and Other Components
			Secured Debt	(9)	7/30/2021		12.15% (L+11.00%, Floor 1.00%)	7/31/2026		23,975		23,779		23,779
			Preferred Stock	(8) (30)	7/30/2021	10,000						10,000		10,000
												33,779		33,779
Pearl Meyer Topco LLC		Provider of Executive Compensation Consulting Services
			Secured Debt		4/27/2020		12.00%	4/27/2025		28,681		28,506		28,681
			Member Units	(8)	4/27/2020	13,800						13,000		39,750
												41,506		68,431
PPL RVs, Inc.		Recreational Vehicle Dealer

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

June 30, 2022

(dollars in thousands)

(Unaudited)


Portfolio Company (1) (20)	Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate (39)	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)
		Secured Debt	(9)	11/15/2016		7.97% (L+7.00%, Floor 0.50%)	11/15/2027		19,655		19,394		19,645
		Common Stock	(8)	6/10/2010	2,000						2,150		18,490
											21,544		38,135
Principle Environmental, LLC	Noise Abatement Service Provider
		Secured Debt		2/1/2011		13.00%	11/15/2026		473		471		471
		Secured Debt		7/1/2011		13.00%	11/15/2026		5,924		5,820		5,820
		Preferred Member Units	(8)	2/1/2011	21,806						5,709		11,530
		Common Stock		1/27/2021	1,037						1,200		740
											13,200		18,561
Quality Lease Service, LLC	Provider of Rigsite Accommodation Unit Rentals and Related Services
		Member Units		6/8/2015	1,000						8,063		1,075

River Aggregates, LLC	Processor of Construction Aggregates
		Member Units	(8) (30)	12/20/2013	1,500						369		3,380

Robbins Bros. Jewelry, Inc.	Bridal Jewelry Retailer
		Secured Debt	(9)	12/15/2021		12.00% (L+11.00%, Floor 1.00%)	12/15/2026		36,135		35,774		35,774
		Preferred Equity		12/15/2021	11,070						11,070		15,740
											46,844		51,514
Tedder Industries, LLC	Manufacturer of Firearm Holsters and Accessories
		Secured Debt		8/31/2018		12.00%	8/31/2022		1,840		1,840		1,840
		Secured Debt		8/31/2018		12.00%	8/31/2023		15,200		15,185		15,185
		Preferred Member Units		8/31/2018	518						8,801		7,314
											25,826		24,339
Televerde, LLC	Provider of Telemarketing and Data Services
		Member Units		1/6/2011	460						1,290		5,145
		Preferred Stock		1/26/2022	248						718		1,794
											2,008		6,939
Trantech Radiator Topco, LLC	Transformer Cooling Products and Services
		Secured Debt		5/31/2019		12.00%	5/31/2024		8,320		8,277		8,314
		Common Stock	(8)	5/31/2019	615						4,655		8,090
											12,932		16,404
Vision Interests, Inc.	Manufacturer / Installer of Commercial Signage
		Series A Preferred Stock	(8)	12/23/2011	3,000,000						3,000		3,000

VVS Holdco LLC	Omnichannel Retailer of Animal Health Products
		Secured Debt	(30)	12/1/2021		11.50%	12/1/2026		30,400		30,102		30,102
		Preferred Equity	(8) (30)	12/1/2021	11,840						11,840		12,080
											41,942		42,182
Ziegler’s NYPD, LLC	Casual Restaurant Group
		Secured Debt		6/1/2015		12.00%	10/1/2022		625		625		625
		Secured Debt		10/1/2008		6.50%	10/1/2022		1,000		1,000		1,000
		Secured Debt		10/1/2008		14.00%	10/1/2022		2,750		2,750		2,750
		Preferred Member Units		6/30/2015	10,072						2,834		1,680
		Warrants	(27)	7/1/2015	587		10/1/2025				600		-
											7,809		6,055
Subtotal Control Investments (82.5% of net assets at fair value)										$	1,145,692	$	1,538,158

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

June 30, 2022

(dollars in thousands)

(Unaudited)


Portfolio Company (1) (20)		Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate (39)	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)

Affiliate Investments (6)

AAC Holdings, Inc.	(11)	Substance Abuse Treatment Service Provider
			Secured Debt	(19)	12/11/2020		18.00% PIK	6/25/2025	$	10,621	$	10,457	$	10,090
			Common Stock		12/11/2020	593,928						3,148		800
			Warrants	(27)	12/11/2020	554,353		12/11/2025				-		740
												13,605		11,630
AFG Capital Group, LLC		Provider of Rent-to-Own Financing Solutions and Services
			Preferred Member Units	(8)	11/7/2014	186						1,200		8,780

ATX Networks Corp.	(11)	Provider of Radio Frequency Management Equipment
			Secured Debt	(9)	9/1/2021		8.92% (L+7.50%, Floor 1.00%)	9/1/2026		7,071		6,496		6,187
			Unsecured Debt	(19)	9/1/2021		10.00% PIK	9/1/2028		3,225		2,121		2,242
			Common Stock		9/1/2021	583						-		-
												8,617		8,429
BBB Tank Services, LLC		Maintenance, Repair and Construction Services to the Above-Ground Storage Tank Market
			Unsecured Debt	(9) (17)	4/8/2016		12.06% (L+11.00%, Floor 1.00%)	4/8/2021		4,800		4,800		2,298
			Preferred Stock (non-voting)	(19)	12/17/2018		15.00% PIK					162		-
			Member Units		4/8/2016	800,000						800		-
												5,762		2,298
Boccella Precast Products LLC		Manufacturer of Precast Hollow Core Concrete
			Secured Debt		9/23/2021		10.00%	2/28/2027		320		320		320
			Member Units	(8)	6/30/2017	2,160,000						2,256		4,510
												2,576		4,830
Buca C, LLC		Casual Restaurant Group
			Secured Debt	(9)	6/30/2015		10.37% (L+9.25%, Floor 1.00%)	6/30/2023		18,270		18,270		13,149
			Preferred Member Units	(19)	6/30/2015	6	6.00% PIK					4,770		-
												23,040		13,149
Career Team Holdings, LLC		Provider of Workforce Training and Career Development Services
			Secured Debt		12/17/2021		12.50%	12/17/2026		20,250		20,070		20,070
			Common Stock		12/17/2021	450,000						4,500		4,500
												24,570		24,570
Chandler Signs Holdings, LLC	(10)	Sign Manufacturer
			Class A Units		1/4/2016	1,500,000						1,500		620

Classic H&G Holdings, LLC		Provider of Engineered Packaging Solutions
			Secured Debt	(9)	3/12/2020		7.00% (L+6.00%, Floor 1.00%)	3/12/2025		5,560		5,560		5,560
			Secured Debt		3/12/2020		8.00%	3/12/2025		19,274		19,160		19,274
			Preferred Member Units	(8)	3/12/2020	154						5,760		23,790
												30,480		48,624
Congruent Credit Opportunities Funds	(12) (13)	Investment Partnership

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

June 30, 2022

(dollars in thousands)

(Unaudited)


Portfolio Company (1) (20)		Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate (39)	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)
			LP Interests (Congruent Credit Opportunities Fund III, LP)	(8) (31)	2/4/2015	17.4%						8,659		8,299

DMA Industries, LLC		Distributor of aftermarket ride control products
			Secured Debt		11/19/2021		12.00%	11/19/2026		21,200		21,014		21,200
			Preferred Equity		11/19/2021	5,944						5,944		6,920
												26,958		28,120
Dos Rios Partners	(12) (13)	Investment Partnership
			LP Interests (Dos Rios Partners, LP)	(31)	4/25/2013	20.2%						6,605		8,610
			LP Interests (Dos Rios Partners - A, LP)	(31)	4/25/2013	6.4%						2,097		2,734
												8,702		11,344
Dos Rios Stone Products LLC	(10)	Limestone and Sandstone Dimension Cut Stone Mining Quarries
			Class A Preferred Units	(30)	6/27/2016	2,000,000						2,000		350

EIG Fund Investments	(12) (13)	Investment Partnership
			LP Interests (EIG Global Private Debt Fund-A, L.P.)	(8) (31)	11/6/2015	11.1%						436		389

Freeport Financial Funds	(12) (13)	Investment Partnership
			LP Interests (Freeport Financial SBIC Fund LP)	(8) (31)	3/23/2015	9.3%						4,064		4,116
			LP Interests (Freeport First Lien Loan Fund III LP)	(8) (31)	7/31/2015	6.0%						7,250		6,795
												11,314		10,911
GFG Group, LLC.		Grower and Distributor of a Variety of Plants and Products to Other Wholesalers, Retailers and Garden Centers
			Secured Debt		3/31/2021		9.00%	3/31/2026		12,545		12,448		12,545
			Preferred Member Units	(8)	3/31/2021	226						4,900		6,990
												17,348		19,535
Harris Preston Fund Investments	(12) (13)	Investment Partnership
			LP Interests (HPEP 3, L.P.)	(8) (31)	8/9/2017	8.2%						2,833		4,331
			LP Interests (423 COR, LP)	(31)	6/2/2022	22.9%						1,400		1,400
												4,233		5,731
Hawk Ridge Systems, LLC		Value-Added Reseller of Engineering Design and Manufacturing Solutions
			Secured Debt	(9)	12/2/2016		7.13% (L+6.00%, Floor 1.00%)	1/15/2026		2,585		2,585		2,585
			Secured Debt		12/2/2016		8.00%	1/15/2026		34,800		34,687		34,800
			Preferred Member Units	(8)	12/2/2016	226						2,850		20,030
			Preferred Member Units	(30)	12/2/2016	226						150		1,050

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

June 30, 2022

(dollars in thousands)

(Unaudited)


Portfolio Company (1) (20)		Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate (39)	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)
												40,272		58,465
Houston Plating and Coatings, LLC		Provider of Plating and Industrial Coating Services
			Unsecured Convertible Debt		5/1/2017		8.00%	10/2/2024		3,000		3,000		2,750
			Member Units	(8)	1/8/2003	322,297						2,352		2,520
												5,352		5,270
I-45 SLF LLC	(12) (13)	Investment Partnership
			Member Units (Fully diluted 20.0%; 21.75% profits interest)	(8)	10/20/2015							19,000		12,949

Iron-Main Investments, LLC		Consumer Reporting Agency Providing Employment Background Checks and Drug Testing
			Secured Debt		8/2/2021		12.50%	11/15/2026		4,600		4,561		4,561
			Secured Debt		9/1/2021		12.50%	11/15/2026		3,200		3,173		3,173
			Secured Debt		11/15/2021		12.50%	11/15/2026		28,944		28,769		28,769
			Common Stock		8/3/2021	179,778						1,798		1,798
												38,301		38,301
L.F. Manufacturing Holdings, LLC	(10)	Manufacturer of Fiberglass Products
			Preferred Member Units (non-voting)	(8) (19)	1/1/2019		14.00% PIK					115		115
			Member Units	(8)	12/23/2013	2,179,001						2,019		3,150
												2,134		3,265
OnAsset Intelligence, Inc.		Provider of Transportation Monitoring / Tracking Products and Services
			Secured Debt	(14) (19)	5/20/2014		12.00% PIK	12/31/2022		964		964		808
			Secured Debt	(14) (19)	3/21/2014		12.00% PIK	12/31/2022		983		983		825
			Secured Debt	(14) (19)	5/10/2013		12.00% PIK	12/31/2022		2,116		2,116		1,776
			Secured Debt	(14) (19)	4/18/2011		12.00% PIK	12/31/2022		4,415		4,415		3,704
			Unsecured Debt	(14) (19)	6/5/2017		10.00% PIK	12/31/2022		197		197		197
			Preferred Stock	(14) (19)	4/18/2011	912	7.00% PIK					1,981		-
			Common Stock		4/15/2021	635						830		-
			Warrants	(27)	4/18/2011	4,699		5/10/2023				1,089		-
												12,575		7,310
Oneliance, LLC		Construction Cleaning Company
			Secured Debt	(9)	8/6/2021		12.06% (L+11.00%, Floor 1.00%)	8/6/2026		5,600		5,553		5,553
			Preferred Stock		8/6/2021	1,056						1,056		1,056
												6,609		6,609
Rocaceia, LLC (Quality Lease and Rental Holdings, LLC)		Provider of Rigsite Accommodation Unit Rentals and Related Services
			Secured Debt	(14) (17)	6/30/2015		12.00%	1/8/2018		30,369		29,865		-
			Preferred Member Units		1/8/2013	250						2,500		-
												32,365		-
SI East, LLC		Rigid Industrial Packaging Manufacturing
			Secured Debt		8/31/2018		10.25%	8/31/2023		64,361		64,285		64,361
			Preferred Member Units	(8)	8/31/2018	157						1,218		12,830
												65,503		77,191
Slick Innovations, LLC		Text Message Marketing Platform
			Secured Debt		9/13/2018		12.00%	9/13/2023		4,640		4,596		4,640
			Common Stock		9/13/2018	70,000						700		1,640
			Warrants	(27)	9/13/2018	18,084		9/13/2028				181		440
												5,477		6,720
Sonic Systems International, LLC	(10)	Nuclear Power Staffing Services

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

June 30, 2022

(dollars in thousands)

(Unaudited)


Portfolio Company (1) (20)		Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate (39)	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)
			Secured Debt	(9)	8/20/2021		8.50% (L+7.50%, Floor 1.00%)	8/20/2026		15,769		15,495		15,260
			Common Stock		8/20/2021	9,968						1,356		1,420
												16,851		16,680
Superior Rigging & Erecting Co.		Provider of Steel Erecting, Crane Rental & Rigging Services
			Secured Debt		8/31/2020		12.00%	8/31/2025		21,500		21,355		21,355
			Preferred Member Units		8/31/2020	1,571						4,500		4,500
												25,855		25,855
The Affiliati Network, LLC		Performance Marketing Solutions
			Secured Debt		8/9/2021		11.83%	8/9/2026		11,761		11,643		11,643
			Preferred Stock	(8)	8/9/2021	1,280,000						6,400		6,400
												18,043		18,043
UnionRock Energy Fund II, LP	(12) (13)	Investment Partnership
			LP Interests	(8) (31)	6/15/2020	11.1%						2,567		3,865

UniTek Global Services, Inc.	(11)	Provider of Outsourced Infrastructure Services
			Secured Debt	(9) (19)	10/15/2018		9.07% (7.07% cash, 2.00% PIK) (2.00% PIK, L+5.50% Floor 1.00%)	8/20/2024		401		400		366
			Secured Debt	(9) (19)	8/27/2018		9.07% (7.07% cash, 2.00% PIK) (2.00% PIK, L+5.50% Floor 1.00%)	8/20/2024		2,006		1,996		1,828
			Secured Convertible Debt	(19)	1/1/2021		15.00% PIK	2/20/2025		1,339		1,339		2,588
			Preferred Stock	(8) (19)	8/29/2019	1,133,102	20.00% PIK					1,938		2,833
			Preferred Stock	(19)	8/21/2018	1,521,122	20.00% PIK					2,188		1,891
			Preferred Stock	(19)	6/30/2017	2,281,682	19.00% PIK					3,667		-
			Preferred Stock	(19)	1/15/2015	4,336,866	13.50% PIK					7,924		-
			Common Stock		4/1/2020	945,507						-		-
												19,452		9,506
Universal Wellhead Services Holdings, LLC	(10)	Provider of Wellhead Equipment, Designs, and Personnel to the Oil & Gas Industry
			Preferred Member Units	(19) (30)	12/7/2016	716,949	14.00% PIK					1,032		-
			Member Units	(30)	12/7/2016	4,000,000						4,000		-
												5,032		-
Volusion, LLC		Provider of Online Software-as-a-Service eCommerce Solutions
			Secured Debt	(17)	1/26/2015		11.50%	1/26/2020		17,084		17,084		17,084
			Unsecured Convertible Debt		5/16/2018		8.00%	11/16/2023		409		409		409
			Preferred Member Units		1/26/2015	4,876,670						14,000		2,930
			Warrants	(27)	1/26/2015	1,831,355		1/26/2025				2,576		-
												34,069		20,423
Subtotal Affiliate Investments (27.8% of net assets at fair value)											$	540,457	$	518,061

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

June 30, 2022

(dollars in thousands)

(Unaudited)


Portfolio Company (1) (20)		Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate (39)	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)

Non-Control/Non-Affiliate Investments (7)

Acousti Engineering Company of Florida	(10)	Interior Subcontractor Providing Acoustical Walls and Ceilings
			Secured Debt	(9)	11/2/2020		10.00% (L+8.50%, Floor 1.50%)	11/2/2025	$	11,840	$	11,750	$	11,267
			Secured Debt	(9)	5/26/2021		14.00% (L+12.50%, Floor 1.50%)	11/2/2025		828		821		828
												12,571		12,095
Acumera, Inc.	(10)	Managed Security Service Provider
			Secured Debt	(9)	6/28/2022		10.56% (L+9.50%, Floor 1.00%)	10/26/2027		17,763		17,294		17,294

Adams Publishing Group, LLC	(10)	Local Newspaper Operator
			Secured Debt		3/11/2022		10.75%	3/11/2027		788		788		788
			Secured Debt	(9)	3/11/2022		8.72% (L+7.00%, Floor 1.00%)	3/11/2027		24,945		24,883		24,883
												25,671		25,671
ADS Tactical, Inc.	(11)	Value-Added Logistics and Supply Chain Provider to the Defense Industry
			Secured Debt	(9)	3/29/2021		7.20% (L+5.75%, Floor 1.00%)	3/19/2026		21,861		21,512		20,213

American Health Staffing Group, Inc.	(10)	Healthcare Temporary Staffing
			Secured Debt	(9)	11/19/2021		8.01% (L+6.00%, Floor 1.00%)	11/19/2026		6,650		6,579		6,324

American Nuts, LLC	(10)	Roaster, Mixer and Packager of Bulk Nuts and Seeds
			Secured Debt	(9) (39)	3/11/2022		7.75% (SOFR+6.75%, Floor 1.00%)	4/10/2026		15,682		15,428		15,428
			Secured Debt	(9) (39)	3/11/2022		9.75% (SOFR+8.75%, Floor 1.00%)	4/10/2026		15,707		15,451		15,451
												30,879		30,879
American Teleconferencing Services, Ltd.	(11)	Provider of Audio Conferencing and Video Collaboration Solutions
			Secured Debt	(9) (14)	9/17/2021		7.50% (L+6.50%, Floor 1.00%)	6/30/2022		2,980		2,980		171
			Secured Debt	(9) (14)	5/19/2016		7.50% (L+6.50%, Floor 1.00%)	6/28/2023		14,370		13,706		826
												16,686		997
ArborWorks, LLC	(10)	Vegetation Management Services
			Secured Debt	(9)	11/9/2021		9.00% (L+7.00%, Floor 1.00%)	11/9/2026		2,807		2,684		2,557
			Secured Debt	(9)	11/9/2021		8.37% (L+7.00%, Floor 1.00%)	11/9/2026		30,178		29,649		27,492
			Common Equity		11/9/2021	234						234		14
												32,567		30,063
Arrow International, Inc	(10)	Manufacturer and Distributor of Charitable Gaming Supplies
			Secured Debt	(9) (23) (39)	12/21/2020		8.21% (SOFR+6.63%, Floor 1.00%)	12/21/2025		36,000		35,693		35,656

ATS Operating, LLC	(10)	For-Profit Thrift Retailer
			Secured Debt	(9) (39)	1/18/2022		6.50%(SOFR+5.50%, Floor 1.00%)	1/18/2027		6,660		6,660		6,660
			Secured Debt	(9) (39)	1/18/2022		8.50%(SOFR+7.50%, Floor 1.00%)	1/18/2027		6,660		6,660		6,660
			Common Stock		1/18/2022	720,000						720		720

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

June 30, 2022

(dollars in thousands)

(Unaudited)


Portfolio Company (1) (20)		Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate (39)	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)
												14,040		14,040
AVEX Aviation Holdings, LLC	(10)	Specialty Aircraft Dealer
			Secured Debt	(9)	12/15/2021		8.82% (L+7.00%, Floor 1.00%)	12/15/2026		12,179		11,962		11,195
			Secured Debt	(9)	12/15/2021		9.06% (L+7.00%, Floor 1.00%)	12/15/2026		1,440		1,375		1,324
			Common Equity		12/15/2021	360						360		258
												13,697		12,777
Berry Aviation, Inc.	(10)	Charter Airline Services
			Secured Debt	(19)	7/6/2018		12.00% (10.50% Cash, 1.50% PIK)	1/6/2024		194		194		194
			Preferred Member Units	(8) (19) (30)	11/12/2019	122,416	16.00% PIK					182		372
			Preferred Member Units	(8) (19) (30)	7/6/2018	1,548,387	8.00% PIK					2,105		4,475
												2,481		5,041
Bettercloud, Inc.	(10)	SaaS Provider of Workflow Management and Business Application Solutions
			Secured Debt	(9) (19) (39)	6/30/2022		8.53% (1.00% Cash, 7.53% PIK) (SOFR+7.25%, Floor 0.75%)	6/30/2028		26,811		26,199		26,199

Binswanger Enterprises, LLC	(10)	Glass Repair and Installation Service Provider
			Secured Debt	(9) (39)	3/10/2017		10.12% (SOFR+8.50%, Floor 1.00%)	6/10/2024		11,807		11,700		11,599
			Member Units		3/10/2017	1,050,000						1,050		560
												12,750		12,159
Bluestem Brands, Inc.	(11)	Multi-Channel Retailer of General Merchandise
			Secured Debt	(9)	8/28/2020		10.00% (L+8.50%, Floor 1.50%)	8/28/2025		5,357		5,357		5,346
			Common Stock	(8)	10/1/2020	723,184						1		5,790
												5,358		11,136
Brainworks Software, LLC	(10)	Advertising Sales and Newspaper Circulation Software
			Secured Debt	(9) (14) (17)	8/12/2014		12.50% (Prime+9.25%, Floor 3.25%)	7/22/2019		7,817		7,817		4,201

Brightwood Capital Fund Investments	(12) (13)	Investment Partnership
			LP Interests (Brightwood Capital Fund V, LP)	(31)	7/12/2021	1.3%						2,000		2,139
			LP Interests (Brightwood Capital Fund III, LP)	(8) (31)	7/21/2014	1.6%						7,062		4,454
			LP Interests (Brightwood Capital Fund IV, LP)	(8) (31)	10/26/2016	0.6%						4,350		4,394
												13,412		10,987
Burning Glass Intermediate Holding Company, Inc.	(10)	Provider of Skills-Based Labor Market Analytics
			Secured Debt	(9)	6/14/2021		6.12% (L+5.00%, Floor 1.00%)	6/10/2026		929		898		913
			Secured Debt	(9)	6/14/2021		6.06% (L+5.00%, Floor 1.00%)	6/10/2028		19,983		19,680		19,626
												20,578		20,539
Cadence Aerospace LLC	(10)	Aerostructure Manufacturing

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

June 30, 2022

(dollars in thousands)

(Unaudited)


Portfolio Company (1) (20)		Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate (39)	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)
			Secured Debt	(9) (19) (34)	11/14/2017		9.49% Cash, 0.24% PIK	11/14/2023		28,502		28,399		27,923

CAI Software LLC		Provider of Specialized Enterprise Resource Planning Software
			Preferred Equity	(8)	12/13/2021	1,788,527						1,789		1,789
			Preferred Equity		12/13/2021	596,176						-		-
												1,789		1,789
Camin Cargo Control, Inc.	(11)	Provider of Mission Critical Inspection, Testing and Fuel Treatment Services
			Secured Debt	(9)	6/14/2021		7.86% (L+6.50%, Floor 1.00%)	6/4/2026		15,338		15,214		15,261

CaseWorthy, Inc.	(10)	SaaS Provider of Case Management Solutions
			Secured Debt	(9) (39)	5/18/2022		7.46% (SOFR+6.00%, Floor 1.00%)	5/18/2027		6,148		6,077		6,077

Cenveo Corporation	(11)	Provider of Digital Marketing Agency Services
			Common Stock		9/7/2018	322,907						6,183		7,221

Channel Partners Intermediateco, LLC	(10)	Outsourced Consumer Services Provider
			Secured Debt	(9) (39)	2/7/2022		8.00% (SOFR+6.50%, Floor 1.00%)	2/7/2027		5,183		5,069		5,069
			Secured Debt	(9) (37)	2/7/2022		7.74%	2/7/2027		39,253		38,518		38,518
												43,587		43,587
Clarius BIGS, LLC	(10)	Prints & Advertising Film Financing
			Secured Debt	(14) (17) (19)	9/23/2014		15.00% PIK	1/5/2015		2,734		2,734		17

Computer Data Source, LLC	(10)	Third Party Maintenance Provider to the Data Center Ecosystem
			Secured Debt	(9)	8/6/2021		8.87% (L+7.50%, Floor 1.00%)	8/6/2026		23,794		23,398		22,285

Construction Supply Investments, LLC	(10)	Distribution Platform of Specialty Construction Materials to Professional Concrete and Masonry Contractors
			Member Units	(8)	12/29/2016	861,618						3,335		19,320

Darr Equipment LP	(10)	Heavy Equipment Dealer
			Secured Debt		12/26/2017		11.50%	6/22/2023		4,681		4,681		4,337
			Warrants	(29)	4/15/2014	915,734		12/23/2023				474		510
												5,155		4,847
DTE Enterprises, LLC	(10)	Industrial Powertrain Repair and Services
			Secured Debt	(9)	4/13/2018		9.00% (L+7.50%, Floor 1.50%)	4/13/2023		8,574		8,538		8,106
			Class AA Preferred Member Units (non-voting)	(8) (19)	4/13/2018		10.00% PIK					1,104		1,104
			Class A Preferred Member Units	(19)	4/13/2018	776,316	8.00% PIK					776		180
												10,418		9,390
Dynamic Communities, LLC	(10)	Developer of Business Events and

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

June 30, 2022

(dollars in thousands)

(Unaudited)


Portfolio Company (1) (20)		Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate (39)	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)
		Online Community Groups
			Secured Debt	(9)	7/17/2018		10.13% (L+8.50%, Floor 1.00%)	7/17/2023		5,611		5,581		5,048

Eastern Wholesale Fence LLC	(10)	Manufacturer and Distributor of Residential and Commercial Fencing Solutions
			Secured Debt	(9)	11/19/2020		8.58%, (L+7.00%, Floor 1.00%)	10/30/2025		33,302		32,810		31,614

Emerald Technologies Acquisition Co, Inc.	(11)	Design & Manufacturing
			Secured Debt	(9) (39)	2/10/2022		7.25% (SOFR+6.25%, Floor 0.75%)	2/10/2028		9,375		9,198		9,094

EnCap Energy Fund Investments	(12) (13)	Investment Partnership
			LP Interests (EnCap Energy Capital Fund VIII, L.P.)	(8) (31)	1/22/2015	0.1%						3,591		2,188
			LP Interests (EnCap Energy Capital Fund VIII Co- Investors, L.P.)	(8) (31)	1/21/2015	0.4%						1,984		1,037
			LP Interests (EnCap Energy Capital Fund IX, L.P.)	(8) (31)	1/22/2015	0.1%						3,807		2,230
			LP Interests (EnCap Energy Capital Fund X, L.P.)	(8) (31)	3/25/2015	0.1%						8,337		9,978
			LP Interests (EnCap Flatrock Midstream Fund II, L.P.)	(31)	3/30/2015	0.8%						5,358		1,583
			LP Interests (EnCap Flatrock Midstream Fund III, L.P.)	(8) (31)	3/27/2015	0.2%						6,042		5,212
												29,119		22,228
Engineering Research & Consulting, LLC	(10)	Provider of Engineering & Consulting Services to US Department of Defense
			Secured Debt	(9)	5/23/2022		9.50% (Prime+5.50%, Floor 0.75%)	5/23/2027		851		801		801
			Secured Debt	(9)	5/23/2022		9.50% (Prime+5.50%, Floor 0.75%)	5/23/2028		16,379		16,061		16,061
												16,862		16,862
EPIC Y-Grade Services, LP	(11)	NGL Transportation & Storage
			Secured Debt	(9)	6/22/2018		8.08% (L+6.00%, Floor 1.00%)	6/30/2027		6,858		6,792		6,018

Event Holdco, LLC	(10)	Event and Learning Management Software for Healthcare Organizations and Systems
			Secured Debt	(9) (30)	12/22/2021		8.00% (L+7.00%, Floor 1.00%)	12/22/2026		3,692		3,659		3,520
			Secured Debt	(9) (30)	12/22/2021		7.75% (L+6.75%, Floor 1.00%)	12/22/2026		44,308		43,911		42,235
												47,570		45,755

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

June 30, 2022

(dollars in thousands)

(Unaudited)


Portfolio Company (1) (20)		Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate (39)	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)
Flip Electronics LLC	(10)	Distributor of Hard-to-Find and Obsolete Electronic Components
			Secured Debt	(9) (39)	1/4/2021		9.60% (SOFR+7.50%, Floor 1.00%)	1/2/2026		6,185		6,069		6,069
			Secured Debt	(9) (39)	3/24/2022		8.50% (SOFR+7.50%, Floor 1.00%)	1/2/2026		245		245		245
												6,314		6,314
Fuse, LLC	(11)	Cable Networks Operator
			Secured Debt		6/30/2019		12.00%	6/28/2024		1,810		1,810		1,512
			Common Stock		6/30/2019	10,429						256		-
												2,066		1,512
GeoStabilization International (GSI)	(11)	Geohazard Engineering Services & Maintenance
			Secured Debt		1/2/2019		6.61% (L+5.25%)	12/19/2025		20,604		20,521		20,088

GS HVAM Intermediate, LLC	(10)	Specialized Food Distributor
			Secured Debt	(9)	10/18/2019		6.81% (L+5.75%, Floor 1.00%)	10/2/2024		13,159		13,097		12,678

HDC/HW Intermediate Holdings	(10)	Managed Services and Hosting Provider
			Secured Debt	(9)	12/21/2018		8.51% (L+7.50%, Floor 1.00%)	12/21/2023		3,437		3,414		3,056

Heartland Dental, LLC	(10)	Dental Support Organization
			Secured Debt	(9)	9/9/2020		8.17% (L+6.50%, Floor 1.00%)	4/30/2025		14,700		14,417		14,479

HOWLCO LLC	(11) (13) (21)	Provider of Accounting and Business Development Software to Real Estate End Markets
			Secured Debt	(9)	8/19/2021		7.50% (L+6.00%, Floor 1.00%)	10/23/2026		25,418		25,418		24,609

Hybrid Promotions, LLC	(10)	Wholesaler of Licensed, Branded and Private Label Apparel
			Secured Debt	(9) (39)	6/30/2021		9.25% (SOFR+8.25%, Floor 1.00%)	6/30/2026		7,088		6,972		6,550

IG Parent Corporation	(11)	Software Engineering
			Secured Debt	(9)	7/30/2021		6.96% (L+5.75%, Floor 1.00%)	7/30/2026		188		156		181
			Secured Debt	(9)	7/30/2021		6.99% (L+5.75%, Floor 1.00%)	7/30/2026		9,543		9,421		9,205
												9,577		9,386
Implus Footcare, LLC	(10)	Provider of Footwear and Related Accessories
			Secured Debt	(9) (19)	6/1/2017		9.01% (8.76% Cash, 0.25% PIK) (0.25% PIK + L+7.75%, Floor 1.00%)	4/30/2024		18,609		18,427		17,169

Independent Pet Partners Intermediate Holdings, LLC	(10)	Omnichannel Retailer of Specialty Pet Products
			Secured Debt	(19) (35)	8/20/2020		9.89% PIK	12/22/2022		6,658		6,658		6,658
			Secured Debt	(19)	12/10/2020		6.00% PIK	11/20/2023		18,428		17,664		17,121
			Preferred Stock (non-voting)	(19)	12/10/2020		6.00% PIK					3,235		2,874
			Preferred Stock (non-voting)		12/10/2020							-		-
			Member Units		11/20/2018	1,558,333						1,558		-

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

June 30, 2022

(dollars in thousands)

(Unaudited)


Portfolio Company (1) (20)		Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate (39)	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)
												29,115		26,653
Industrial Services Acquisition, LLC	(10)	Industrial Cleaning Services
			Secured Debt	(9)	8/13/2021		8.38% (L+6.75%, Floor 1.00%)	8/13/2026		463		426		426
			Secured Debt	(9)	8/13/2021		7.81% (L+6.75%, Floor 1.00%)	8/13/2026		19,385		19,061		19,033
			Preferred Member Units	(8) (19) (30)	1/31/2018	144	10.00% PIK					125		159
			Preferred Member Units	(8) (19) (30)	5/17/2019	80	20.00% PIK					86		98
			Member Units	(30)	6/17/2016	900						900		690
												20,598		20,406
Infolinks Media Buyco, LLC	(10)	Exclusive Placement Provider to the Advertising Ecosystem
			Secured Debt	(9)	11/1/2021		6.76% (L+5.75%, Floor 1.00%)	11/1/2026		8,637		8,465		8,331

Interface Security Systems, L.L.C	(10)	Commercial Security & Alarm Services
			Secured Debt	(9)	12/9/2021		11.75% (L+10.00%, Floor 1.75%)	8/7/2023		938		938		938
			Secured Debt	(9) (14) (19)	8/7/2019		9.75% PIK (L+8.00% PIK, Floor 1.75%)	8/7/2023		7,313		7,237		3,550
			Common Stock		12/7/2021	2,143						-		-
												8,175		4,488
Intermedia Holdings, Inc.	(11)	Unified Communications as a Service
			Secured Debt	(9)	8/3/2018		7.36% (L+6.00%, Floor 1.00%)	7/19/2025		20,573		20,515		19,442

Invincible Boat Company, LLC.	(10)	Manufacturer of Sport Fishing Boats
			Secured Debt	(9)	8/28/2019		8.73% (L+6.50%, Floor 1.50%)	8/28/2025		311		306		306
			Secured Debt	(9)	8/28/2019		8.00% (L+6.50%, Floor 1.50%)	8/28/2025		16,889		16,765		16,244
												17,071		16,550
INW Manufacturing, LLC	(11)	Manufacturer of Nutrition and Wellness Products
			Secured Debt	(9)	5/19/2021		7.38% (L+5.75%, Floor 0.75%)	3/25/2027		7,219		7,041		6,822

Isagenix International, LLC	(11)	Direct Marketer of Health & Wellness Products
			Secured Debt	(9)	6/21/2018		7.34% (L+5.75%, Floor 1.00%)	6/14/2025		4,951		4,932		2,966

Jackmont Hospitality, Inc.	(10)	Franchisee of Casual Dining Restaurants
			Secured Debt	(9)	5/26/2015		7.51% (L+6.50%, Floor 1.00%)	11/4/2024		2,090		2,090		1,993
			Preferred Equity	(8)	11/8/2021	2,826,667						110		610
												2,200		2,603
Joerns Healthcare, LLC	(11)	Manufacturer and Distributor of Health Care Equipment & Supplies
			Secured Debt	(9)	8/21/2019		7.55% (L+6.00%, Floor 1.00%)	8/21/2024		4,034		3,997		2,626
			Secured Debt	(19)	11/15/2021		15.00% PIK	11/8/2022		1,768		1,768		1,768
			Common Stock		8/21/2019	472,579						4,429		-
												10,194		4,394
JTI Electrical & Mechanical, LLC	(10)	Electrical, Mechanical and Automation Services
			Secured Debt	(9)	12/22/2021		7.01% (L+6.00%, Floor 1.00%)	12/22/2026		37,421		36,598		36,366
			Common Equity		12/22/2021	1,684,211						1,684		1,760
												38,282		38,126

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

June 30, 2022

(dollars in thousands)

(Unaudited)


Portfolio Company (1) (20)		Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate (39)	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)
KMS, LLC	(10)	Wholesaler of Closeout and Value-priced Products
			Secured Debt	(9)	10/4/2021		8.31% (L+7.25%, Floor 1.00%)	10/4/2026		7,543		7,413		6,941
			Secured Debt	(9)	10/4/2021		9.31% (L+7.25%, Floor 1.00%)	10/4/2026		1,086		1,034		1,034
												8,447		7,975
Kore Wireless Group Inc.	(11) (13)	Mission Critical Software Platform
			Secured Debt		12/31/2018		7.13% (L+5.50%)	12/20/2024		11,356		11,298		11,271

Laredo Energy, LLC	(10)	Oil & Gas Exploration & Production
			Member Units		5/4/2020	1,155,952						11,560		11,383

Lightbox Holdings, L.P.	(11)	Provider of Commercial Real Estate Software
			Secured Debt		5/23/2019		6.63% (L+5.00%)	5/9/2026		14,550		14,404		14,186

LKCM Headwater Investments I, L.P.	(12) (13)	Investment Partnership
			LP Interests	(8) (31)	1/25/2013	2.3%						1,746		3,074

LL Management, Inc.	(10)	Medical Transportation Service Provider
			Secured Debt	(9) (39)	5/2/2019		8.25% (SOFR+7.25%, Floor 1.00%)	9/25/2023		17,424		17,332		17,279
			Secured Debt	(9) (39)	5/12/2022		8.25% (SOFR+7.25%, Floor 1.00%)	9/25/2023		10,855		10,711		10,711
												28,043		27,990
LLFlex, LLC	(10)	Provider of Metal-Based Laminates
			Secured Debt	(9)	8/16/2021		10.00% (L+9.00%, Floor 1.00%)	8/16/2026		4,455		4,371		4,130

Logix Acquisition Company, LLC	(10)	Competitive Local Exchange Carrier
			Secured Debt	(9)	1/8/2018		6.81% (L+5.75%, Floor 1.00%)	12/22/2024		19,662		18,876		18,320

Looking Glass Investments, LLC	(12) (13)	Specialty Consumer Finance
			Member Units		7/1/2015	3						125		25

Mac Lean-Fogg Company	(10)	Manufacturer and Supplier for Auto and Power Markets
			Secured Debt	(9)	4/22/2019		6.06% (L+5.25%, Floor 0.625%)	12/22/2025		16,993		16,919		16,314
			Preferred Stock	(19)	10/1/2019		13.75% (4.50% Cash, 9.25% PIK)					1,962		1,785
												18,881		18,099
Mako Steel, LP	(10)	Self-Storage Design & Construction
			Secured Debt	(9)	3/15/2021		8.81% (L+7.25%, Floor 0.75%)	3/13/2026		2,556		2,509		2,388
			Secured Debt	(9)	3/15/2021		8.38 % (L+7.25%, Floor 0.75%)	3/13/2026		15,503		15,267		14,489
												17,776		16,877
MB2 Dental Solutions, LLC	(11)	Dental Partnership Organization
			Secured Debt	(9)	1/28/2021		7.24% (L+6.00%, Floor 1.00%)	1/29/2027		7,916		7,813		7,712
			Secured Debt	(9) (36)	1/28/2021		7.52%	1/29/2027		6,168		6,112		6,008
												13,925		13,720
Microbe Formulas, LLC	(10)	Nutritional Supplements Provider
			Secured Debt	(9) (39)	4/4/2022		7.48% (SOFR+6.25%, Floor 1.00%)	4/3/2028		30,319		29,683		29,683

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

June 30, 2022

(dollars in thousands)

(Unaudited)


Portfolio Company (1) (20)		Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate (39)	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)
Mills Fleet Farm Group, LLC	(10)	Omnichannel Retailer of Work, Farm and Lifestyle Merchandise
			Secured Debt	(9)	10/24/2018		7.31% (L+6.25%, Floor 1.00%)	10/24/2024		17,300		17,125		16,759

MonitorUS Holding, LLC	(10) (13) (21)	SaaS Provider of Media Intelligence Services
			Secured Debt	(9)	5/24/2022		8.51% (L+7.00%, Floor 1.00%)	5/24/2027		17,038		16,537		16,537

NBG Acquisition Inc	(11)	Wholesaler of Home Décor Products
			Secured Debt	(9)	4/28/2017		7.00% (L+5.50%, Floor 1.00%)	4/26/2024		3,904		3,884		2,194

NinjaTrader, LLC	(10)	Operator of Futures Trading Platform
			Secured Debt	(9)	12/18/2019		7.25% (L+6.25%, Floor 1.00%)	12/18/2024		31,425		30,934		30,743

NNE Partners, LLC	(10)	Oil & Gas Exploration & Production
			Secured Debt		3/2/2017		10.31% (L+9.25%)	12/31/2023		24,781		24,727		23,486

Northstar Group Services, Inc	(11)	Commercial & Industrial Services
			Secured Debt	(9)	11/1/2021		6.86% (L+5.50%, Floor 1.00%)	11/12/2026		9,806		9,764		9,451

NTM Acquisition Corp.	(11)	Provider of B2B Travel Information Content
			Secured Debt	(9) (19)	7/12/2016		8.26% (7.26% Cash, 1.00% PIK) (1.00%PIK + L+6.25%, Floor 1.00%)	6/7/2024		4,478		4,478		4,322

NWN Corporation	(10)	Value Added Reseller and Provider of Managed Services to a Diverse Set of Industries
			Secured Debt	(9)	5/7/2021		7.87% (L+6.50%, Floor 1.00%)	5/7/2026		40,719		39,958		37,228

Ospemifene Royalty Sub LLC	(10)	Estrogen-Deficiency Drug Manufacturer and Distributor
			Secured Debt	(14)	7/8/2013		11.50%	11/15/2026		4,526		4,526		76

OVG Business Services, LLC	(10)	Venue Management Services
			Secured Debt	(9)	11/29/2021		7.25% (L+6.25%, Floor 1.00%)	11/19/2028		13,965		13,837		13,267

Paragon Healthcare, Inc.	(10)	Infusion Therapy Treatment Provider
			Secured Debt	(9) (39)	1/19/2022		6.75% (SOFR+5.75%, Floor 1.00%)	1/19/2027		18,881		18,165		18,165

Project Eagle Holdings, LLC	(10)	Provider of Secure Business Collaboration Software
			Secured Debt	(9)	7/6/2020		7.76% (L+6.75%, Floor 1.00%)	7/6/2026		29,588		29,068		28,143

RA Outdoors LLC	(10)	Software Solutions Provider for Outdoor Activity Management

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

June 30, 2022

(dollars in thousands)

(Unaudited)


Portfolio Company (1) (20)		Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate (39)	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)
			Secured Debt	(9) (39)	4/8/2021		8.10% (SOFR+6.75%, Floor 1.00%)	4/8/2026		13,369		13,208		11,882

Research Now Group, Inc. and Survey Sampling International, LLC	(11)	Provider of Outsourced Online Surveying
			Secured Debt	(9)	12/29/2017		6.50% (L+5.50%, Floor 1.00%)	12/20/2024		20,071		19,793		18,606

RM Bidder, LLC	(10)	Scripted and Unscripted TV and Digital Programming Provider
			Member Units		11/12/2015	2,779						46		23
			Warrants	(26)	11/12/2015	187,161		10/20/2025				425		-
												471		23
Roof Opco, LLC	(10)	Residential Re-Roofing/Repair
			Secured Debt	(9)	8/27/2021		7.00% (L+6.00%, Floor 1.00%)	8/27/2026		2,800		2,740		2,559
			Secured Debt	(9)	8/27/2021		7.01% (L+6.00%, Floor 1.00%)	8/27/2026		1,929		1,885		1,772
												4,625		4,331
RTIC Subsidiary Holdings, LLC	(10)	Direct-To-Consumer eCommerce Provider of Outdoor Products
			Secured Debt	(9)	9/1/2020		9.00% (L+7.75%, Floor 1.25%)	9/1/2025		20,486		20,321		19,711

Rug Doctor, LLC.	(10)	Carpet Cleaning Products and Machinery
			Secured Debt	(9)	7/16/2021		7.31% (L+6.25%, Floor 1.00%)	11/16/2024		14,190		13,994		12,255

Salient Partners L.P.	(11)	Provider of Asset Management Services
			Secured Debt	(9)	8/31/2018		7.01% (L+6.00%, Floor 1.00%)	10/30/2022		6,251		6,249		4,920
			Secured Debt	(9)	9/30/2021		7.00% (L+6.00%, Floor 1.00%)	10/30/2022		1,250		1,250		2,435
												7,499		7,355
Savers, Inc.	(11)	For-Profit Thrift Retailer
			Secured Debt	(9)	5/14/2021		7.13% (L+5.75%, Floor 0.75%)	4/26/2028		11,343		11,247		10,729

SIB Holdings, LLC	(10)	Provider of Cost Reduction Services
			Secured Debt	(9)	10/29/2021		7.58% (L+6.00%, Floor 1.00%)	10/29/2026		8,508		8,352		8,352
			Common Equity		10/29/2021	95,238						200		200
												8,552		8,552
South Coast Terminals Holdings, LLC	(10)	Specialty Toll Chemical Manufacturer
			Secured Debt	(9)	12/10/2021		7.51% (L+6.25%, Floor 1.00%)	12/13/2026		41,463		40,644		40,644
			Common Equity		12/10/2021	863,636						864		919
												41,508		41,563
Staples Canada ULC	(10) (13) (21)	Office Supplies Retailer
			Secured Debt	(9) (22)	9/14/2017		9.34% (L+7.00%, Floor 1.00%)	9/12/2024		14,928		14,872		13,911

Stellant Systems, Inc.	(11)	Manufacturer of Traveling Wave Tubes and Vacuum Electronic Devices
			Secured Debt	(9)	10/22/2021		7.14% (L+5.50%, Floor 0.75%)	10/1/2028		7,662		7,592		7,125

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

June 30, 2022

(dollars in thousands)

(Unaudited)


Portfolio Company (1) (20)		Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate (39)	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)
Student Resource Center, LLC	(10)	Higher Education Services
			Secured Debt	(9)	6/25/2021		9.01% (L+8.00%, Floor 1.00%)	6/25/2026		10,588		10,406		9,090

Tacala Investment Corp.	(33)	Quick Service Restaurant Group
			Secured Debt	(9)	3/19/2021		4.86% (L+3.75%, Floor 0.75%)	2/5/2027		1,984		1,984		1,861

Team Public Choices, LLC	(11)	Home-Based Care Employment Service Provider
			Secured Debt	(9)	12/22/2020		6.33% (L+5.00%, Floor 1.00%)	12/18/2027		15,040		14,738		14,513

Tectonic Financial, LLC		Financial Services Organization
			Common Stock	(8)	5/15/2017	200,000						2,000		5,630

Tex Tech Tennis, LLC	(10)	Sporting Goods & Textiles
			Common Stock	(30)	7/7/2021	1,000,000						1,000		1,320

U.S. TelePacific Corp.	(11)	Provider of Communications and Managed Services
			Secured Debt	(9) (19) (39)	5/17/2017		9.25% (2.00% Cash, 7.25% PIK) (SOFR+1.00%, Floor 1.00%, 7.25% PIK)	5/2/2026		17,690		17,612		7,518

USA DeBusk LLC	(10)	Provider of Industrial Cleaning Services
			Secured Debt	(9)	10/22/2019		6.81% (L+5.75%, Floor 1.00%)	9/8/2026		37,002		36,318		35,439

Veregy Consolidated, Inc.	(11)	Energy Service Company
			Secured Debt	(9)	11/9/2020		7.24% (L+6.00%, Floor 1.00%)	11/3/2027		17,730		16,675		16,213

Vida Capital, Inc	(11)	Alternative Asset Manager
			Secured Debt		10/10/2019		7.36% (L+6.00%)	10/1/2026		16,141		15,986		13,074

Vistar Media, Inc.	(10)	Operator of Digital Out-of-Home Advertising Platform
			Preferred Stock		4/3/2019	70,207						767		2,350

VORTEQ Coil Finishers, LLC	(10)	Specialty Coating of Aluminum and Light-Gauge Steel
			Secured Debt	(9)	11/30/2021		8.26% (L+7.25%, Floor 1.00%)	11/30/2026		25,637		25,183		24,989
			Common Equity	(8)	11/30/2021	1,038,462						1,038		2,240
												26,221		27,229
Wahoo Fitness Acquisition L.L.C.	(11)	Fitness Training Equipment Provider
			Secured Debt	(9) (39)	8/17/2021		6.90% (SOFR+5.75%, Floor 1.00%)	8/12/2028		14,813		14,419		12,072

Wall Street Prep, Inc.	(10)	Financial Training Services
			Secured Debt	(9)	7/19/2021		8.00% (L+7.00%, Floor 1.00%)	7/19/2026		4,290		4,213		3,960
			Common Stock		7/19/2021	400,000						400		400
												4,613		4,360
Watterson Brands, LLC	(10)	Facility Management Services
			Secured Debt	(9)	12/17/2021		7.01% (L+6.00%, Floor 1.00%)	12/17/2026		29,030		28,547		28,547

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

June 30, 2022

(dollars in thousands)

(Unaudited)


Portfolio Company (1) (20)		Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate (39)	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)
West Star Aviation Acquisition, LLC	(10)	Aircraft, Aircraft Engine and Engine Parts
			Secured Debt	(9) (39)	3/1/2022		6.75% (SOFR+6.0%, Floor 0.75%)	3/1/2028		10,848		10,622		10,622
			Common Stock		3/1/2022	1,522,200						1,541		1,541
												12,163		12,163
Winter Services LLC	(10)	Provider of Snow Removal and Ice Management Services
			Secured Debt	(9)	11/19/2021		8.00% (L+7.00%, Floor 1.00%)	11/19/2026		10,000		9,766		9,442

Xenon Arc, Inc.	(10)	Tech-enabled Distribution Services to Chemicals and Food Ingredients Primary Producers
			Secured Debt	(9)	12/17/2021		6.75% (L+6.00%, Floor 0.75%)	12/17/2026		38,407		37,354		36,712

YS Garments, LLC	(11)	Designer and Provider of Branded Activewear
			Secured Debt	(9)	8/22/2018		6.54% (L+5.50%, Floor 1.00%)	8/9/2024		12,846		12,793		12,397

Zips Car Wash, LLC	(10)	Express Car Wash Operator
			Secured Debt	(9)	2/11/2022		8.26%(L+7.25%, Floor 1.00%)	3/1/2024		17,600		17,266		17,266
			Secured Debt	(9) (38)	2/11/2022		8.72%	3/1/2024		4,017		3,979		3,979
												21,245		21,245
Subtotal Non-Control/Non-Affiliate Investments (89.1% of net assets at fair value)											$	1,737,243	$	1,661,551
Total Portfolio Investments, June 30, 2022 (199.3% of net assets at fair value)											$	3,423,392	$	3,717,770


(1)	All investments are Lower Middle Market portfolio investments, unless otherwise noted. See Note C—Fair Value Hierarchy for Investments—Portfolio Composition 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 by footnote (8), as described below.
(3)	See Note C—Fair Value Hierarchy for Investments—Portfolio Composition 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 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, SOFR or an alternate Base Rate (commonly based on the Federal Funds Rate or the Prime Rate), which typically resets every one, three, or six months at the borrower’s option. As noted in this schedule, 69% of the loans (based on the par amount) contain LIBOR or Term SOFR ("SOFR") floors which range between 0.50% and 2.00%, with a weighted-average floor of 1.04%.

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

June 30, 2022

(dollars in thousands)

(Unaudited)

(10)	Private Loan portfolio investment. See Note C—Fair Value Hierarchy for Investments—Portfolio Composition for a description of Private Loan portfolio investments.
(11)	Middle Market portfolio investment. See Note C—Fair Value Hierarchy for Investments—Portfolio Composition for a description of Middle Market portfolio investments.
(12)	Other Portfolio investment. See Note C—Fair Value Hierarchy for Investments—Portfolio Composition 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)	All of the Company’s portfolio investments are generally subject to restrictions on resale as “restricted securities.”
(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—Fair Value Hierarchy for Investments—Portfolio Composition 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 $18.4 million Canadian Dollars and receive $14.5 million U.S. Dollars with a settlement date of September 14, 2022. The unrealized appreciation on the forward foreign currency contract was not significant as of June 30, 2022.
(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 7.25% (Floor 1.25%) per the credit agreement and the Consolidated Schedule of Investments above reflects such higher rate.
(24)	Investment date represents the date of initial investment in the security position.
(25)	Warrants are presented in equivalent shares with a strike price of $10.92 per share.
(26)	Warrants are presented in equivalent units with a strike price of $14.28 per unit.
(27)	Warrants are presented in equivalent shares/units with a strike price of $0.01 per share/unit.
(28)	Warrants are presented in equivalent shares with a strike price of $0.001 per share.
(29)	Warrants are presented in equivalent units with a strike price of $1.50 per unit.
(30)	Shares/Units represent ownership in a related Real Estate or HoldCo entity.
(31)	Investment is not unitized. Presentation is made in percent of fully diluted ownership unless otherwise indicated.
(32)	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.
(33)	Short-term portfolio investments. See Note C—Fair Value Hierarchy for Investments—Portfolio Composition for a description of short-term portfolio investments.
(34)	The security has an effective contractual interest rate of 2.00% PIK + LIBOR+6.50%, Floor 1.00%, but the issuer may, in its discretion, elect to pay the PIK interest in cash. The rate presented represents the effective current yield based on actual payments received during the period.

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

June 30, 2022

(dollars in thousands)

(Unaudited)

(35)	As of June 30, 2022, borrowings under the loan facility bear interest at LIBOR+6.50% PIK or Prime+5.50% PIK. Revolving facility permits the borrower to make an interest rate election regarding the base rate on each draw under the facility. The rate presented represents a weighted-average rate for borrowings under the facility.
(36)	As of June 30, 2022, borrowings under the loan facility bear interest at LIBOR+6.00% (Floor 1.00%) or Prime+5.00%. Delayed draw term loan facility permits the borrower to make an interest rate election regarding the base rate on each draw under the facility. The rate presented represents a weighted-average rate for borrowings under the facility.
(37)	As of June 30, 2022, borrowings under the loan facility bear interest at LIBOR+6.50% (Floor 1.00%). Each new draw on the delayed draw term loan facility has a different floating rate reset date. The rate presented represents a weighted-average rate for borrowings under the facility.
(38)	As of June 30, 2022, borrowings under the loan facility bear interest at LIBOR+7.25% (Floor 1.00%). Each new draw on the delayed draw term loan facility has a different floating rate reset date. The rate presented represents a weighted-average rate for borrowings under the facility.
(39)	SOFR based contracts may include a credit spread adjustment (the “Adjustment”) that is charged in addition to the stated spread. The Adjustment is applied when the SOFR rate, plus the Adjustment, exceeds the stated floor rate, as applicable. As of June 30, 2022, SOFR based contracts in the portfolio had Adjustments ranging from 0.10% to 0.26%.

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments

December 31, 2021

(dollars in thousands)


Portfolio Company (1) (20)		Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)

Control Investments (5)

Analytical Systems Keco Holdings, LLC		Manufacturer of Liquid and Gas Analyzers
			Secured Debt	(9)	8/16/2019		12.00% (L+10.00%, Floor 2.00%)	8/16/2024	$	4,945	$	4,736	$	4,736
			Preferred Member Units		8/16/2019	3,200						3,200		-
			Preferred Member Units		5/20/2021	2,427						2,427		4,894
			Warrants	(27)	8/16/2019	420		8/16/2029				316		-
												10,679		9,630
ASC Interests, LLC		Recreational and Educational Shooting Facility
			Secured Debt		12/31/2019		13.00%	7/31/2022		200		200		200
			Secured Debt		8/1/2013		13.00%	7/31/2022		1,650		1,636		1,636
			Member Units		8/1/2013	1,500						1,500		720
												3,336		2,556
ATS Workholding, LLC	(10)	Manufacturer of Machine Cutting Tools and Accessories
			Secured Debt	(14)	11/16/2017		5.00%	8/16/2023		4,794		4,635		3,005
			Preferred Member Units		11/16/2017	3,725,862						3,726		-
												8,361		3,005
Barfly Ventures, LLC	(10)	Casual Restaurant Group
			Secured Debt		10/15/2020		7.00%	10/31/2024		711		711		711
			Member Units		10/26/2020	37						1,584		1,930
												2,295		2,641
Bolder Panther Group, LLC		Consumer Goods and Fuel Retailer
			Secured Debt	(9)	12/31/2020		10.50% (L+9.00%, Floor 1.50%)	12/31/2025		39,000		38,687		39,000
			Class A Preferred Member Units	(8)	12/31/2020		14.00%					10,194		10,194
			Class B Preferred Member Units	(8)	12/31/2020	140,000	8.00%					14,000		23,170
												62,881		72,364
Brewer Crane Holdings, LLC		Provider of Crane Rental and Operating Services
			Secured Debt	(9)	1/9/2018		11.00% (L+10.00%, Floor 1.00%)	1/9/2023		8,060		8,037		8,037
			Preferred Member Units	(8)	1/9/2018	2,950						4,280		7,710
												12,317		15,747
Bridge Capital Solutions Corporation		Financial Services and Cash Flow Solutions Provider
			Secured Debt		7/25/2016		13.00%	12/11/2024		8,813		8,813		8,813
			Warrants	(27)	7/25/2016	82		7/25/2026				2,132		4,060
			Secured Debt	(30)	7/25/2016		13.00%	12/11/2024		1,000		1,000		1,000
			Preferred Member Units	(8) (30)	7/25/2016	17,742						1,000		1,000
												12,945		14,873
Café Brazil, LLC		Casual Restaurant Group
			Member Units	(8)	6/9/2006	1,233						1,742		2,570

California Splendor Holdings LLC		Processor of Frozen Fruits
			Secured Debt	(9)	3/30/2018		11.00% (L+10.00%, Floor 1.00%)	3/30/2023		28,000		27,915		27,915
			Preferred Member Units	(8) (19)	7/31/2019	6,725	15.00% PIK					9,510		9,510
			Preferred Member Units	(8)	3/30/2018	6,157						10,775		13,275
												48,200		50,700

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2021

(dollars in thousands)


Portfolio Company (1) (20)		Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)
CBT Nuggets, LLC		Produces and Sells IT Training Certification Videos
			Member Units	(8)	6/1/2006	416						1,300		50,620

Centre Technologies Holdings, LLC		Provider of IT Hardware Services and Software Solutions
			Secured Debt	(9)	1/4/2019		12.00% (L+10.00%, Floor 2.00%)	1/4/2024		9,416		9,370		8,864
			Preferred Member Units		1/4/2019	12,696						5,840		5,840
												15,210		14,704
Chamberlin Holding LLC		Roofing and Waterproofing Specialty Contractor
			Secured Debt	(9)	2/26/2018		9.00% (L+8.00%, Floor 1.00%)	2/26/2023		17,817		17,738		17,817
			Member Units	(8)	2/26/2018	4,347						11,440		24,140
			Member Units	(8) (30)	11/2/2018	1,047,146						1,322		1,540
												30,500		43,497
Charps, LLC		Pipeline Maintenance and Construction
			Unsecured Debt		8/26/2020		10.00%	1/31/2024		5,694		4,599		5,694
			Preferred Member Units	(8)	2/3/2017	1,829						1,963		13,990
												6,562		19,684
Clad-Rex Steel, LLC		Specialty Manufacturer of Vinyl-Clad Metal
			Secured Debt	(9)	12/20/2016		10.50% (L+9.50%, Floor 1.00%)	1/15/2024		10,480		10,401		10,401
			Member Units	(8)	12/20/2016	717						7,280		10,250
			Secured Debt		12/20/2016		10.00%	12/20/2036		1,081		1,071		1,071
			Member Units	(30)	12/20/2016	800						210		530
												18,962		22,252
CMS Minerals Investments		Oil & Gas Exploration & Production
			Member Units	(8) (30)	4/1/2016	100						1,838		1,974

Cody Pools, Inc.		Designer of Residential and Commercial Pools
			Secured Debt	(9)	3/6/2020		12.25% (L+10.50%, Floor 1.75%)	12/17/2026		42,497		42,117		42,484
			Preferred Member Units	(8) (30)	3/6/2020	587						8,317		47,640
												50,434		90,124
Colonial Electric Company LLC		Provider of Electrical Contracting Services
			Secured Debt		3/31/2021		12.00%	3/31/2026		24,570		24,351		24,351
			Preferred Member Units	(8)	3/31/2021	17,280						7,680		9,130
												32,031		33,481
CompareNetworks Topco, LLC		Internet Publishing and Web Search Portals
			Secured Debt	(9)	1/29/2019		10.00% (L+9.00%, Floor 1.00%)	1/29/2024		6,477		6,452		6,477
			Preferred Member Units	(8)	1/29/2019	1,975						1,975		12,000
												8,427		18,477
Copper Trail Fund Investments	(12) (13)	Investment Partnership
			LP Interests (CTMH, LP)	(31)	7/17/2017	38.8%						710		710

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2021

(dollars in thousands)


Portfolio Company (1) (20)		Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)
Datacom, LLC		Technology and Telecommunications Provider
			Secured Debt		3/31/2021		5.00%	12/31/2025		8,892		8,296		7,668
			Preferred Member Units		3/31/2021	9,000						2,610		2,610
												10,906		10,278
Digital Products Holdings LLC		Designer and Distributor of Consumer Electronics
			Secured Debt	(9)	4/1/2018		11.00% (L+10.00%, Floor 1.00%)	4/1/2023		16,853		16,801		16,801
			Preferred Member Units	(8)	4/1/2018	3,857						9,501		9,835
												26,302		26,636
Direct Marketing Solutions, Inc.		Provider of Omni-Channel Direct Marketing Services
			Secured Debt	(9)	2/13/2018		12.00% (L+11.00%, Floor 1.00%)	2/13/2024		24,070		23,911		24,048
			Preferred Stock	(8)	2/13/2018	8,400						8,400		18,350
												32,311		42,398
Gamber-Johnson Holdings, LLC		Manufacturer of Ruggedized Computer Mounting Systems
			Secured Debt	(9)	6/24/2016		9.50% (L+7.50%, Floor 2.00%)	1/1/2025		21,598		21,535		21,598
			Member Units	(8)	6/24/2016	9,042						17,692		49,700
												39,227		71,298
Garreco, LLC		Manufacturer and Supplier of Dental Products
			Secured Debt	(9)	7/15/2013		9.00% (L+8.00%, Floor 1.00%, Ceiling 1.50%)	7/31/2022		4,196		4,196		4,196
			Member Units	(8)	7/15/2013	1,200						1,200		2,270
												5,396		6,466
GRT Rubber Technologies LLC		Manufacturer of Engineered Rubber Products
			Secured Debt		12/19/2014		8.10% (L+8.00%)	10/29/2026		38,885		38,672		38,885
			Member Units	(8)	12/19/2014	5,879						13,065		46,190
												51,737		85,075
Gulf Manufacturing, LLC		Manufacturer of Specialty Fabricated Industrial Piping Products
			Member Units	(8)	8/31/2007	438						2,980		5,640

Gulf Publishing Holdings, LLC		Energy Industry Focused Media and Publishing
			Secured Debt	(9) (17) (19)	9/29/2017		10.50% (5.25% Cash, 5.25% PIK) (L+9.50%, Floor 1.00%)	9/30/2020		257		257		257
			Secured Debt	(17) (19)	4/29/2016		12.50% (6.25% Cash, 6.25% PIK)	4/29/2021		13,565		13,565		9,717
			Member Units		4/29/2016	3,681						3,681		-
												17,503		9,974
Harris Preston Fund Investments	(12) (13)	Investment Partnership
			LP Interests (2717 MH, L.P.)	(31)	10/1/2017	49.3%						2,703		3,971

Harrison Hydra-Gen, Ltd.		Manufacturer of Hydraulic Generators
			Common Stock		6/4/2010	107,456						718		3,530

Jensen Jewelers of Idaho, LLC		Retail Jewelry Store
			Secured Debt	(9)	11/14/2006		10.00% (Prime+6.75%, Floor 2.00%)	11/14/2023		2,550		2,536		2,550

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2021

(dollars in thousands)


Portfolio Company (1) (20)		Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)
			Member Units	(8)	11/14/2006	627						811		12,420
												3,347		14,970
Johnson Downie Opco, LLC		Executive Search Services
			Secured Debt	(9)	12/10/2021		13.00% (L+11.50%, Floor 1.50%)	12/10/2026		11,475		11,344		11,344
			Preferred Equity		12/10/2021	3,150						3,150		3,150
												14,494		14,494
KBK Industries, LLC		Manufacturer of Specialty Oilfield and Industrial Products
			Member Units	(8)	1/23/2006	325						783		13,620

Kickhaefer Manufacturing Company, LLC		Precision Metal Parts Manufacturing
			Secured Debt		10/31/2018		11.50%	10/31/2023		20,415		20,324		20,324
			Member Units		10/31/2018	581						12,240		12,310
			Secured Debt		10/31/2018		9.00%	10/31/2048		3,915		3,876		3,876
			Member Units	(8) (30)	10/31/2018	800						992		2,460
												37,432		38,970
Market Force Information, LLC		Provider of Customer Experience Management Services
			Secured Debt	(9)	7/28/2017		12.00% (L+11.00%, Floor 1.00%)	7/28/2023		3,400		3,400		3,400
			Secured Debt	(14) (19)	7/28/2017		12.00% PIK	7/28/2023		26,079		25,952		8,936
			Member Units		7/28/2017	743,921						16,642		-
												45,994		12,336
MH Corbin Holding LLC		Manufacturer and Distributor of Traffic Safety Products
			Secured Debt		8/31/2015		13.00%	3/31/2022		8,250		8,241		5,934
			Preferred Member Units		3/15/2019	66,000						4,400		-
			Preferred Member Units		9/1/2015	4,000						6,000		-
												18,641		5,934
MS Private Loan Fund I, LP	(12) (13)	Investment Partnership
			Unsecured Debt		2/11/2021		5.00%	2/28/2022		63,151		63,151		63,151
			LP Interests	(31)	1/26/2021	12.1%						2,500		2,581
												65,651		65,732
MSC Adviser I, LLC	(16)	Third Party Investment Advisory Services
			Member Units	(8)	11/22/2013							29,500		140,400

Mystic Logistics Holdings, LLC		Logistics and Distribution Services Provider for Large Volume Mailers
			Secured Debt		8/18/2014		12.00%	1/17/2022		6,378		6,377		6,378
			Common Stock	(8)	8/18/2014	5,873						2,720		8,840
												9,097		15,218
NAPCO Precast, LLC		Precast Concrete Manufacturing
			Member Units	(8)	1/31/2008	2,955						2,975		13,560

Nebraska Vet AcquireCo, LLC		Mixed-Animal Veterinary and Animal Health Product Provider
			Secured Debt		12/31/2020		12.00%	12/31/2025		10,500		10,412		10,412
			Secured Debt		12/31/2020		12.00%	12/31/2025		4,868		4,829		4,829
			Preferred Member Units		12/31/2020	6,987						6,987		7,700
												22,228		22,941
NexRev LLC		Provider of Energy Efficiency Products & Services
			Secured Debt		2/28/2018		11.00%	2/28/2023		16,217		16,173		14,045
			Preferred Member Units	(8)	2/28/2018	86,400,000						6,880		2,690
												23,053		16,735
NRP Jones, LLC		Manufacturer of Hoses, Fittings and Assemblies
			Secured Debt		12/21/2017		12.00%	3/20/2023		2,080		2,080		2,080
			Member Units	(8)	12/22/2011	65,962						3,717		6,440
												5,797		8,520

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2021

(dollars in thousands)


Portfolio Company (1) (20)	Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)
NuStep, LLC	Designer, Manufacturer and Distributor of Fitness Equipment
		Secured Debt	(9)	1/31/2017		7.50% (L+6.50%, Floor 1.00%)	1/31/2025		1,720		1,720		1,720
		Secured Debt		1/31/2017		11.00%	1/31/2025		17,240		17,236		17,240
		Preferred Member Units		1/31/2017	406						10,200		13,500
											29,156		32,460
OMi Topco, LLC	Manufacturer of Overhead Cranes
		Secured Debt		8/31/2021		12.00%	8/31/2026		18,000		17,831		18,000
		Preferred Member Units	(8)	4/1/2008	900						1,080		20,210
											18,911		38,210
Orttech Holdings, LLC	Distributor of Industrial Clutches, Brakes and Other Components
		Secured Debt	(9)	7/30/2021		12.00% (L+11.00%, Floor 1.00%)	7/31/2026		24,375		24,151		24,151
		Preferred Stock	(8) (30)	7/30/2021	10,000						10,000		10,000
											34,151		34,151
Pearl Meyer Topco LLC	Provider of Executive Compensation Consulting Services
		Secured Debt		4/27/2020		12.00%	4/27/2025		32,674		32,438		32,674
		Member Units	(8)	4/27/2020	13,800						13,000		26,970
											45,438		59,644
PPL RVs, Inc.	Recreational Vehicle Dealer
		Secured Debt	(9)	10/31/2019		7.50% (L+7.00%, Floor 0.50%)	11/15/2022		750		726		726
		Secured Debt	(9)	11/15/2016		7.50% (L+7.00%, Floor 0.50%)	11/15/2022		11,655		11,655		11,655
		Common Stock	(8)	6/10/2010	2,000						2,150		14,360
											14,531		26,741
Principle Environmental, LLC	Noise Abatement Service Provider
		Secured Debt		2/1/2011		13.00%	11/15/2026		1,473		1,465		1,465
		Secured Debt		7/1/2011		13.00%	11/15/2026		5,924		5,808		5,808
		Preferred Member Units		2/1/2011	21,806						5,709		11,160
		Common Stock		1/27/2021	1,037						1,200		710
											14,182		19,143
Quality Lease Service, LLC	Provider of Rigsite Accommodation Unit Rentals and Related Services
		Member Units		6/8/2015	1,000						9,213		2,149

River Aggregates, LLC	Processor of Construction Aggregates
		Member Units	(8) (30)	12/20/2013	1,500						369		3,280

Robbins Bros. Jewelry, Inc.	Bridal Jewelry Retailer
		Secured Debt	(9)	12/15/2021		12.00% (L+11.00%, Floor 1.00%)	12/15/2026		36,360		35,956		35,956
		Preferred Equity		12/15/2021	11,070						11,070		11,070
											47,026		47,026
Tedder Industries, LLC	Manufacturer of Firearm Holsters and Accessories
		Secured Debt		8/31/2018		12.00%	8/31/2022		16,240		16,181		16,181
		Preferred Member Units		8/31/2018	505						8,579		8,579
											24,760		24,760
Televerde, LLC	Provider of Telemarketing and Data Services
		Member Units		1/6/2011	460						1,290		7,280

Trantech Radiator Topco, LLC	Transformer Cooling Products and Services

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2021

(dollars in thousands)


Portfolio Company (1) (20)		Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)
			Secured Debt		5/31/2019		12.00%	5/31/2024		8,720		8,663		8,712
			Common Stock	(8)	5/31/2019	615						4,655		8,660
												13,318		17,372
UnionRock Energy Fund II, LP	(12) (13)	Investment Partnership
			LP Interests	(8) (31)	6/15/2020	49.6%						3,828		6,122

Vision Interests, Inc.		Manufacturer / Installer of Commercial Signage
			Series A Preferred Stock		12/23/2011	3,000,000						3,000		3,000

VVS Holdco LLC		Omnichannel Retailer of Animal Health Products
			Secured Debt	(9)(30)	12/1/2021		7.00% (L+6.00%, Floor 1.00%)	12/1/2026		1,200		1,170		1,169
			Secured Debt	(30)	12/1/2021		11.50%	12/1/2026		30,400		30,100		30,100
			Preferred Equity	(30)	12/1/2021	11,840						11,840		11,840
												43,110		43,109
Ziegler’s NYPD, LLC		Casual Restaurant Group
			Secured Debt		6/1/2015		12.00%	10/1/2022		625		625		625
			Secured Debt		10/1/2008		6.50%	10/1/2022		1,000		1,000		1,000
			Secured Debt		10/1/2008		14.00%	10/1/2022		2,750		2,750		2,750
			Preferred Member Units		6/30/2015	10,072						2,834		2,130
			Warrants	(27)	7/1/2015	587		10/1/2025				600		-
												7,809		6,505
Subtotal Control Investments (83.3% of net assets at fair value)											$	1,107,597	$	1,489,257

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2021

(dollars in thousands)


Portfolio Company (1) (20)		Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)

Affiliate Investments (6)

AAC Holdings, Inc.	(11)	Substance Abuse Treatment Service Provider
			Secured Debt	(19)	12/11/2020		18.00% (10.00% Cash, 8.00% PIK)	6/25/2025	$	10,202	$	10,011	$	9,794
			Common Stock		12/11/2020	593,928						3,148		2,079
			Warrants	(27)	12/11/2020	554,353		12/11/2025				-		1,940
												13,159		13,813
AFG Capital Group, LLC		Provider of Rent-to-Own Financing Solutions and Services
			Secured Debt		4/25/2019		10.00%	5/25/2022		144		144		144
			Preferred Member Units	(8)	11/7/2014	186						1,200		7,740
												1,344		7,884
ATX Networks Corp.	(11)	Provider of Radio Frequency Management Equipment
			Secured Debt	(9)	9/1/2021		8.50% (L+7.50%, Floor 1.00%)	9/1/2026		7,667		7,092		7,092
			Unsecured Debt	(19)	9/1/2021		10.00% PIK	9/1/2028		3,067		1,963		1,963
			Common Stock		9/1/2021	583						-		-
												9,055		9,055
BBB Tank Services, LLC		Maintenance, Repair and Construction Services to the Above-Ground Storage Tank Market
			Unsecured Debt	(9) (17)	4/8/2016		12.00% (L+11.00%, Floor 1.00%)	4/8/2021		4,800		4,800		2,508
			Preferred Stock (non-voting)	(8) (19)	12/17/2018		15.00% PIK					162		-
			Member Units		4/8/2016	800,000						800		-
												5,762		2,508
Boccella Precast Products LLC		Manufacturer of Precast Hollow Core Concrete
			Secured Debt		9/23/2021		10.00%	2/28/2027		320		320		320
			Member Units	(8)	6/30/2017	2,160,000						2,256		4,830
												2,576		5,150
Brightwood Capital Fund Investments	(12) (13)	Investment Partnership
			LP Interests (Brightwood Capital Fund V, LP)	(31)	7/12/2021	15.8%						1,000		1,000

Buca C, LLC		Casual Restaurant Group
			Secured Debt	(9) (17)	6/30/2015		10.25% (L+9.25%, Floor 1.00%)	6/30/2020		19,491		19,491		14,370
			Preferred Member Units	(19)	6/30/2015	6	6.00% PIK					4,770		-
												24,261		14,370
Career Team Holdings, LLC		Provider of Workforce Training and Career Development Services
			Secured Debt		12/17/2021		12.50%	12/17/2026		20,250		20,050		20,050
			Class A Common Units		12/17/2021	450,000						4,500		4,500
												24,550		24,550
Chandler Signs Holdings, LLC	(10)	Sign Manufacturer
			Class A Units		1/4/2016	1,500,000						1,500		460

Classic H&G Holdings, LLC		Provider of Engineered Packaging Solutions

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2021

(dollars in thousands)


Portfolio Company (1) (20)		Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)
			Secured Debt	(9)	3/12/2020		7.00% (L+6.00%, Floor 1.00%)	3/12/2025		4,000		4,000		4,000
			Secured Debt		3/12/2020		8.00%	3/12/2025		19,274		19,139		19,274
			Preferred Member Units	(8)	3/12/2020	154						5,760		15,260
												28,899		38,534
Congruent Credit Opportunities Funds	(12) (13)	Investment Partnership
			LP Interests (Congruent Credit Opportunities Fund III, LP)	(8) (31)	2/4/2015	17.4%						10,256		9,959

DMA Industries, LLC		Distributor of aftermarket ride control products
			Secured Debt		11/19/2021		12.00%	11/19/2026		21,200		20,993		20,993
			Preferred Equity		11/19/2021	5,944						5,944		5,944
												26,937		26,937
Dos Rios Partners	(12) (13)	Investment Partnership
			LP Interests (Dos Rios Partners, LP)	(31)	4/25/2013	20.2%						6,605		10,329
			LP Interests (Dos Rios Partners - A, LP)	(31)	4/25/2013	6.4%						2,097		3,280
												8,702		13,609
Dos Rios Stone Products LLC	(10)	Limestone and Sandstone Dimension Cut Stone Mining Quarries
			Class A Preferred Units	(30)	6/27/2016	2,000,000						2,000		640

EIG Fund Investments	(12) (13)	Investment Partnership
			LP Interests (EIG Global Private Debt Fund-A, L.P.)	(8) (31)	11/6/2015	5,000,000						594		547

Flame King Holdings, LLC		Propane Tank and Accessories Distributor
			Secured Debt	(9)	10/29/2021		7.50% (L+6.50%, Floor 1.00%)	10/31/2026		6,400		6,324		6,324
			Secured Debt	(9)	10/29/2021		12.00% (L+11.00%, Floor 1.00%)	10/31/2026		21,200		20,996		20,996
			Preferred Equity		10/29/2021	9,360						10,400		10,400
												37,720		37,720
Freeport Financial Funds	(12) (13)	Investment Partnership
			LP Interests (Freeport Financial SBIC Fund LP)	(31)	3/23/2015	9.3%						5,974		6,078
			LP Interests (Freeport First Lien Loan Fund III LP)	(8) (31)	7/31/2015	6.0%						7,629		7,231
												13,603		13,309
GFG Group, LLC.		Grower and Distributor of a Variety of Plants and Products to Other Wholesalers, Retailers and Garden Centers
			Secured Debt		3/31/2021		12.00%	3/31/2026		12,545		12,435		12,545
			Preferred Member Units	(8)	3/31/2021	226						4,900		6,990
												17,335		19,535
Harris Preston Fund Investments	(12) (13)	Investment Partnership

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2021

(dollars in thousands)


Portfolio Company (1) (20)		Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)
			LP Interests (HPEP 3, L.P.)	(31)	8/9/2017	8.2%						3,193		4,712

Hawk Ridge Systems, LLC	(13)	Value-Added Reseller of Engineering Design and Manufacturing Solutions
			Secured Debt	(9)	12/2/2016		7.00% (L+6.00%, Floor 1.00%)	1/15/2026		2,585		2,585		2,585
			Secured Debt		12/2/2016		8.00%	1/15/2026		34,800		34,672		34,800
			Preferred Member Units	(8)	12/2/2016	226						2,850		14,680
			Preferred Member Units	(30)	12/2/2016	226						150		770
												40,257		52,835
Houston Plating and Coatings, LLC		Provider of Plating and Industrial Coating Services
			Unsecured Convertible Debt		5/1/2017		8.00%	5/1/2022		3,000		3,000		2,960
			Member Units	(8)	1/8/2003	322,297						2,352		3,210
												5,352		6,170
I-45 SLF LLC	(12) (13)	Investment Partnership
			Member Units (Fully diluted 20.0%; 24.40% profits interest) (8)	(8)	10/20/2015							19,000		14,387

Iron-Main Investments, LLC		Consumer Reporting Agency Providing Employment Background Checks and Drug Testing
			Secured Debt		8/3/2021		13.00%	8/1/2026		4,600		4,557		4,557
			Secured Debt		9/1/2021		12.50%	9/1/2026		3,200		3,170		3,170
			Secured Debt		8/3/2021		12.50%	11/30/2026		20,000		19,805		19,805
			Secured Debt	(19)	8/3/2021		12.50% PIK	3/31/2022		8,944		8,944		8,944
			Common Stock		8/3/2021	179,778						1,798		1,798
												38,274		38,274
L.F. Manufacturing Holdings, LLC	(10)	Manufacturer of Fiberglass Products
			Preferred Member Units (non-voting)	(8) (19)	1/1/2019		14.00% PIK					107		107
			Member Units		12/23/2013	2,179,001						2,019		2,557
												2,126		2,664
OnAsset Intelligence, Inc.		Provider of Transportation Monitoring / Tracking Products and Services
			Secured Debt	(19)	5/20/2014		12.00% PIK	12/31/2022		935		935		935
			Secured Debt	(19)	3/21/2014		12.00% PIK	12/31/2022		954		954		954
			Secured Debt	(19)	5/10/2013		12.00% PIK	12/31/2022		2,055		2,055		2,055
			Secured Debt	(19)	4/18/2011		12.00% PIK	12/31/2022		4,286		4,286		4,286
			Unsecured Debt	(19)	6/5/2017		10.00% PIK	12/31/2022		192		192		192
			Preferred Stock	(19)	4/18/2011	912	7.00% PIK					1,981		-
			Common Stock		4/15/2021	635						830		-
			Warrants	(27)	4/18/2011	4,699		5/10/2023				1,089		-
												12,322		8,422
Oneliance, LLC		Construction Cleaning Company
			Secured Debt	(9)	8/6/2021		12.00% (L+11.00%, Floor 1.00%)	8/6/2026		5,600		5,547		5,547
			Preferred Stock		8/6/2021	1,056						1,056		1,056
												6,603		6,603
Rocaceia, LLC (Quality Lease and Rental Holdings, LLC)		Provider of Rigsite Accommodation Unit Rentals and Related Services
			Secured Debt	(14) (17)	6/30/2015		12.00%	1/8/2018		30,369		29,865		-
			Preferred Member Units		1/8/2013	250						2,500		-
												32,365		-

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2021

(dollars in thousands)


Portfolio Company (1) (20)		Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)
SI East, LLC		Rigid Industrial Packaging Manufacturing
			Secured Debt		8/31/2018		10.25%	8/31/2023		65,850		65,738		65,850
			Preferred Member Units	(8)	8/31/2018	157						1,218		11,570
												66,956		77,420
Slick Innovations, LLC		Text Message Marketing Platform
			Secured Debt		9/13/2018		13.00%	9/13/2023		5,320		5,248		5,320
			Common Stock		9/13/2018	70,000						700		1,510
			Warrants	(27)	9/13/2018	18,084		9/13/2028				181		400
												6,129		7,230
Sonic Systems International, LLC	(10)	Nuclear Power Staffing Services
			Secured Debt	(9)	8/20/2021		8.50% (L+7.50%, Floor 1.00%)	8/20/2026		11,982		11,757		11,757
			Common Stock		8/20/2021	7,866						1,070		1,070
												12,827		12,827
Superior Rigging & Erecting Co.		Provider of Steel Erecting, Crane Rental & Rigging Services
			Secured Debt		8/31/2020		12.00%	8/31/2025		21,500		21,332		21,332
			Preferred Member Units		8/31/2020	1,571						4,500		4,500
												25,832		25,832
The Affiliati Network, LLC		Performance Marketing Solutions
			Secured Debt		8/9/2021		7.00%	8/9/2026		280		262		262
			Secured Debt		8/9/2021		11.83%	8/9/2026		12,961		12,834		12,834
			Preferred Stock	(8)	8/9/2021	1,280,000						6,400		6,400
												19,496		19,496
UniTek Global Services, Inc.	(11)	Provider of Outsourced Infrastructure Services
			Secured Debt	(9) (19)	10/15/2018		8.50% (6.50% cash, 2.00% PIK) (2.00% PIK, L+5.50% Floor 1.00%)	8/20/2024		397		396		371
			Secured Debt	(9) (19)	8/27/2018		8.50% (6.50% cash, 2.00% PIK) (2.00% PIK, L+5.50% Floor 1.00%)	8/20/2024		1,986		1,974		1,852
			Secured Convertible Debt	(19)	1/1/2021		15.00% PIK	2/20/2025		1,197		1,197		2,375
			Preferred Stock	(8) (19)	8/29/2019	1,133,102	20.00% PIK					1,757		2,833
			Preferred Stock	(19)	8/21/2018	1,521,122	20.00% PIK					2,188		1,498
			Preferred Stock	(19)	1/15/2015	4,336,866	13.50% PIK					7,924		-
			Preferred Stock	(19)	6/30/2017	2,281,682	19.00% PIK					3,667		-
			Common Stock		4/1/2020	945,507						-		-
												19,103		8,929
Universal Wellhead Services Holdings, LLC	(10)	Provider of Wellhead Equipment, Designs, and Personnel to the Oil & Gas Industry
			Preferred Member Units	(19) (30)	12/7/2016	716,949	14.00% PIK					1,032		-
			Member Units	(30)	12/7/2016	4,000,000						4,000		-
												5,032		-
Volusion, LLC		Provider of Online Software-as-a-Service eCommerce Solutions
			Secured Debt	(17)	1/26/2015		11.50%	1/26/2020		17,434		17,434		17,434
			Unsecured Convertible Debt		5/16/2018		8.00%	11/16/2023		409		409		409
			Preferred Member Units		1/26/2015	4,876,670						14,000		5,990
			Warrants	(27)	1/26/2015	1,831,355		1/26/2025				2,576		-
												34,419		23,833

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2021

(dollars in thousands)


Portfolio Company (1) (20)		Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)
Subtotal Affiliate Investments (30.7% of net assets at fair value)											$	578,539	$	549,214

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2021

(dollars in thousands)


Portfolio Company (1) (20)		Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)

Non-Control/Non-Affiliate Investments (7)

Acousti Engineering Company of Florida	(10)	Interior Subcontractor Providing Acoustical Walls and Ceilings
			Secured Debt	(9)	11/2/2020		10.00% (L+8.50%, Floor 1.50%)	11/2/2025	$	12,111	$	12,005	$	12,111
			Secured Debt	(9)	5/26/2021		14.00% (L+12.50%, Floor 1.50%)	11/2/2025		850		841		850
												12,846		12,961
ADS Tactical, Inc.	(11)	Value-Added Logistics and Supply Chain Provider to the Defense Industry
			Secured Debt	(9)	3/29/2021		6.75% (L+5.75%, Floor 1.00%)	3/19/2026		22,136		21,734		22,012

American Health Staffing Group, Inc.	(10)	Healthcare Temporary Staffing
			Secured Debt	(9)	11/19/2021		7.00% (L+6.00%, Floor 1.00%)	11/19/2026		7,067		6,988		6,988

American Nuts, LLC	(10)	Roaster, Mixer and Packager of Bulk Nuts and Seeds
			Secured Debt	(9)	12/21/2018		9.00% (L+8.00%, Floor 1.00%)	4/10/2025		12,017		11,854		12,017

American Teleconferencing Services, Ltd.	(11)	Provider of Audio Conferencing and Video Collaboration Solutions
			Secured Debt	(9) (14) (17)	9/17/2021		7.50% (L+6.50%, Floor 1.00%)	9/9/2021		2,980		2,980		89
			Secured Debt	(9) (14)	5/19/2016		7.50% (L+6.50%, Floor 1.00%)	6/28/2023		14,370		13,706		431
												16,686		520
ArborWorks, LLC	(10)	Vegetation Management Services
			Secured Debt	(9)	11/9/2021		8.00% (L+7.00%, Floor 1.00%)	11/9/2026		32,605		31,873		31,873
			Common Equity		11/9/2021	234						234		234
												32,107		32,107
Arrow International, Inc	(10)	Manufacturer and Distributor of Charitable Gaming Supplies
			Secured Debt	(9) (23)	12/21/2020		9.18% (L+7.93%, Floor 1.25%)	12/21/2025		22,500		22,300		22,500

AVEX Aviation Holdings, LLC	(10)	Specialty Aircraft Dealer
			Secured Debt	(9)	12/15/2021		7.50% (L+6.50%, Floor 1.00%)	12/15/2026		13,320		13,005		13,005
			Common Equity		12/15/2021	360						360		360
												13,365		13,365
Berry Aviation, Inc.	(10)	Charter Airline Services
			Secured Debt	(19)	7/6/2018		12.00% (10.50% Cash, 1.50% PIK)	1/6/2024		4,694		4,674		4,694
			Preferred Member Units	(8) (19) (30)	11/12/2019	122,416	16.00% PIK					168		208
			Preferred Member Units	(19) (30)	7/6/2018	1,548,387	8.00% PIK					1,671		2,487
												6,513		7,389

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2021

(dollars in thousands)


Portfolio Company (1) (20)		Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)
Binswanger Enterprises, LLC	(10)	Glass Repair and Installation Service Provider
			Secured Debt	(9)	3/10/2017		9.50% (L+8.50%, Floor 1.00%)	3/10/2023		12,194		12,107		12,194
			Member Units		3/10/2017	1,050,000						1,050		730
												13,157		12,924
Bluestem Brands, Inc.	(11)	Multi-Channel Retailer of General Merchandise
			Secured Debt	(9)	8/28/2020		10.00% (L+8.50%, Floor 1.50%)	8/28/2025		5,357		5,357		5,337
			Common Stock	(8)	10/1/2020	723,184						1		1,515
												5,358		6,852
Brainworks Software, LLC	(10)	Advertising Sales and Newspaper Circulation Software
			Secured Debt	(9) (14) (17)	8/12/2014		12.50% (Prime+9.25%, Floor 3.25%)	7/22/2019		7,817		7,817		4,201

Brightwood Capital Fund Investments	(12) (13)	Investment Partnership
			LP Interests (Brightwood Capital Fund III, LP)	(8) (31)	7/21/2014	1.6%						7,200		4,269
			LP Interests (Brightwood Capital Fund IV, LP)	(8) (31)	10/26/2016	0.6%						4,350		4,394
												11,550		8,663
Burning Glass Intermediate Holding Company, Inc.	(10)	Provider of Skills-Based Labor Market Analytics
			Secured Debt	(9)	6/14/2021		6.00% (L+5.00%, Floor 1.00%)	6/10/2026		465		429		429
			Secured Debt	(9)	6/14/2021		6.00% (L+5.00%, Floor 1.00%)	6/10/2028		20,134		19,803		19,985
												20,232		20,414
Cadence Aerospace LLC	(10)	Aerostructure Manufacturing
			Secured Debt	(19) (35)	11/14/2017		9.28% Cash, 0.22% PIK	11/14/2023		28,540		28,399		26,767

CAI Software LLC		Provider of Specialized Enterprise Resource Planning Software
			Preferred Equity		12/13/2021	1,788,527						1,789		1,789
			Preferred Equity		12/13/2021	596,176						-		-
												1,789		1,789
Camin Cargo Control, Inc.	(11)	Provider of Mission Critical Inspection, Testing and Fuel Treatment Services
			Secured Debt	(9)	6/14/2021		7.50% (L+6.50%, Floor 1.00%)	6/4/2026		15,920		15,775		15,840

Cenveo Corporation	(11)	Provider of Digital Marketing Agency Services
			Common Stock		9/7/2018	322,907						6,183		2,852

Chisholm Energy Holdings, LLC	(10)	Oil & Gas Exploration & Production
			Secured Debt	(9)	5/15/2019		7.75% (L+6.25%, Floor 1.50%)	5/15/2026		2,857		2,804		2,663

Clarius BIGS, LLC	(10)	Prints & Advertising Film Financing
			Secured Debt	(14) (17) (19)	9/23/2014		15.00% PIK	1/5/2015		2,756		2,756		33

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2021

(dollars in thousands)


Portfolio Company (1) (20)		Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)
Computer Data Source, LLC	(10)	Third Party Maintenance Provider to the Data Center Ecosystem
			Secured Debt	(9)	8/6/2021		8.50% (L+7.50%, Floor 1.00%)	8/6/2026		21,681		21,234		21,234

Construction Supply Investments, LLC	(10)	Distribution Platform of Specialty Construction Materials to Professional Concrete and Masonry Contractors
			Member Units	(8)	12/29/2016	861,618						3,335		14,640

Darr Equipment LP	(10)	Heavy Equipment Dealer
			Secured Debt	(19)	12/26/2017		12.50% (11.50% Cash, 1.00% PIK)	6/22/2023		4,685		4,685		4,227
			Warrants	(29)	4/15/2014	915,734		12/23/2023				474		160
												5,159		4,387
DTE Enterprises, LLC	(10)	Industrial Powertrain Repair and Services
			Secured Debt	(9)	4/13/2018		9.50% (L+8.00%, Floor 1.50%)	4/13/2023		9,324		9,259		8,884
			Class AA Preferred Member Units (non-voting)	(8) (19)	4/13/2018		10.00% PIK					1,051		1,051
			Class A Preferred Member Units	(19)	4/13/2018	776,316	8.00% PIK					776		320
												11,086		10,255
Dynamic Communities, LLC	(10)	Developer of Business Events and Online Community Groups
			Secured Debt	(9)	7/17/2018		9.50% (L+8.50%, Floor 1.00%)	7/17/2023		5,681		5,638		5,569

Eastern Wholesale Fence LLC	(10)	Manufacturer and Distributor of Residential and Commercial Fencing Solutions
			Secured Debt	(9)	11/19/2020		8.00%, (L+7.00%, Floor 1.00%)	10/30/2025		31,810		31,238		31,810

EnCap Energy Fund Investments	(12) (13)	Investment Partnership
			LP Interests (EnCap Energy Capital Fund VIII, L.P.)	(8) (31)	1/22/2015	0.1%						3,745		1,599
			LP Interests (EnCap Energy Capital Fund VIII Co- Investors, L.P.)	(31)	1/21/2015	0.4%						2,097		777
			LP Interests (EnCap Energy Capital Fund IX, L.P.)	(8) (31)	1/22/2015	0.1%						4,047		2,284
			LP Interests (EnCap Energy Capital Fund X, L.P.)	(8) (31)	3/25/2015	0.1%						8,443		8,276
			LP Interests (EnCap Flatrock Midstream Fund II, L.P.)	(31)	3/30/2015	0.8%						6,582		2,796
			LP Interests (EnCap Flatrock	(8) (31)	3/27/2015	0.2%						6,082		5,064

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2021

(dollars in thousands)


Portfolio Company (1) (20)		Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)
			Midstream Fund III, L.P.)
												30,996		20,796
EPIC Y-Grade Services, LP	(11)	NGL Transportation & Storage
			Secured Debt	(9)	6/22/2018		7.00% (L+6.00%, Floor 1.00%)	6/30/2027		6,892		6,819		5,862

Event Holdco, LLC	(10)	Event and Learning Management Software for Healthcare Organizations and Systems
			Secured Debt	(9)(30)	12/22/2021		8.00% (L+7.00%, Floor 1.00%)	12/22/2026		51,692		51,135		51,135

Flip Electronics LLC	(10)	Distributor of Hard-to-Find and Obsolete Electronic Components
			Secured Debt	(9) (33)	1/4/2021		9.09% (L+8.09%, Floor 1.00%)	1/2/2026		5,400		5,304		5,287

Fortna Acquisition Co., Inc.	(10)	Process, Physical Distribution and Logistics Consulting Services
			Secured Debt		7/23/2019		5.09% (L+5.00%)	4/8/2025		7,595		7,525		7,595

Fuse, LLC	(11)	Cable Networks Operator
			Secured Debt		6/30/2019		12.00%	6/28/2024		1,810		1,810		1,672
			Common Stock		6/30/2019	10,429						256		-
												2,066		1,672
GeoStabilization International (GSI)	(11)	Geohazard Engineering Services & Maintenance
			Secured Debt		1/2/2019		5.35% (L+5.25%)	12/19/2025		20,710		20,615		20,606

GoWireless Holdings, Inc.	(11)	Provider of Wireless Telecommunications Carrier Services
			Secured Debt	(9)	1/10/2018		7.50% (L+6.50%, Floor 1.00%)	12/22/2024		18,534		18,440		18,576

Grupo Hima San Pablo, Inc.	(11)	Tertiary Care Hospitals
			Secured Debt	(9) (14) (17)	3/7/2013		9.25% (L+7.00%, Floor 1.50%)	4/30/2019		4,504		4,504		1,269
			Secured Debt	(14) (17)	3/7/2013		13.75%	10/15/2018		2,055		2,040		49
			Secured Debt	(17)	3/7/2013		12.00%	12/24/2021		147		147		147
												6,691		1,465
GS HVAM Intermediate, LLC	(10)	Specialized Food Distributor
			Secured Debt	(9)	10/18/2019		6.75% (L+5.75%, Floor 1.00%)	10/2/2024		13,243		13,167		13,243

GS Operating, LLC	(10)	Distributor of Industrial and Specialty Parts
			Secured Debt	(9)	2/24/2020		8.00% (L+6.50%, Floor 1.50%)	2/24/2025		28,451		28,068		28,451

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2021

(dollars in thousands)


Portfolio Company (1) (20)		Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)
HDC/HW Intermediate Holdings	(10)	Managed Services and Hosting Provider
			Secured Debt	(9)	12/21/2018		8.50% (L+7.50%, Floor 1.00%)	12/21/2023		3,449		3,419		3,059

Heartland Dental, LLC	(10)	Dental Support Organization
			Secured Debt	(9)	9/9/2020		7.50% (L+6.50%, Floor 1.00%)	4/30/2025		14,813		14,477		14,887

HOWLCO LLC	(11) (13) (21)	Provider of Accounting and Business Development Software to Real Estate End Markets
			Secured Debt	(9)	8/19/2021		7.00% (L+6.00%, Floor 1.00%)	10/23/2026		25,546		25,546		25,546

Hybrid Promotions, LLC	(10)	Wholesaler of Licensed, Branded and Private Label Apparel
			Secured Debt	(9)	6/30/2021		9.25% (L+8.25%, Floor 1.00%)	6/30/2026		7,088		6,957		7,028

IG Parent Corporation	(11)	Software Engineering
			Secured Debt	(9)	7/30/2021		6.75% (L+5.75%, Floor 1.00%)	7/30/2026		9,591		9,419		9,419

Implus Footcare, LLC	(10)	Provider of Footwear and Related Accessories
			Secured Debt	(9)	6/1/2017		8.75% (L+7.75%, Floor 1.00%)	4/30/2024		18,702		18,471		17,743

Independent Pet Partners Intermediate Holdings, LLC	(10)	Omnichannel Retailer of Specialty Pet Products
			Secured Debt	(36)	8/20/2020		7.20%	12/22/2022		6,563		6,563		6,563
			Secured Debt	(19)	12/10/2020		6.00% PIK	11/20/2023		17,891		16,861		16,861
			Preferred Stock (non-voting)	(19)	12/10/2020		6.00% PIK					3,235		4,329
			Preferred Stock (non-voting)		12/10/2020							-		-
			Member Units		11/20/2018	1,558,333						1,558		-
												28,217		27,753
Industrial Services Acquisition, LLC	(10)	Industrial Cleaning Services
			Secured Debt	(9)	8/13/2021		7.75% (L+6.75%, Floor 1.00%)	8/13/2026		19,897		19,490		19,490
			Preferred Member Units	(8) (19) (30)	1/31/2018	144	10.00% PIK					120		164
			Preferred Member Units	(8) (19) (30)	5/17/2019	80	20.00% PIK					81		99
			Member Units	(30)	6/17/2016	900						900		730
												20,591		20,483
Infolinks Media Buyco, LLC	(10)	Exclusive Placement Provider to the Advertising Ecosystem
			Secured Debt	(9)	11/1/2021		7.00% (L+6.00%, Floor 1.00%)	11/1/2026		8,680		8,487		8,487

Interface Security Systems, L.L.C	(10)	Commercial Security & Alarm Services
			Secured Debt	(9)	12/9/2021		11.75% (L+10.00%, Floor 1.75%)	8/7/2023		525		525		525
			Secured Debt	(9) (14) (19)	8/7/2019		9.75% (8.75% Cash, 1.00% PIK) (1.00% PIK +	8/7/2023		7,313		7,237		5,233

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2021

(dollars in thousands)


Portfolio Company (1) (20)		Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)
							L+7.00%, Floor 1.75%)
												7,762		5,758
Intermedia Holdings, Inc.	(11)	Unified Communications as a Service
			Secured Debt	(9)	8/3/2018		7.00% (L+6.00%, Floor 1.00%)	7/19/2025		20,627		20,559		20,527

Invincible Boat Company, LLC.	(10)	Manufacturer of Sport Fishing Boats
			Secured Debt	(9)	8/28/2019		8.00% (L+6.50%, Floor 1.50%)	8/28/2025		17,510		17,354		17,510

INW Manufacturing, LLC	(11)	Manufacturer of Nutrition and Wellness Products
			Secured Debt	(9)	5/19/2021		6.50% (L+5.75%, Floor 0.75%)	3/25/2027		7,406		7,205		7,258

Isagenix International, LLC	(11)	Direct Marketer of Health & Wellness Products
			Secured Debt	(9)	6/21/2018		6.75% (L+5.75%, Floor 1.00%)	6/14/2025		5,158		5,135		3,865

Jackmont Hospitality, Inc.	(10)	Franchisee of Casual Dining Restaurants
			Secured Debt	(9)	5/26/2015		8.00% (L+7.00%, Floor 1.00%)	11/4/2024		2,100		2,100		2,100
			Preferred Equity		11/8/2021	2,826,667						314		314
												2,414		2,414
Joerns Healthcare, LLC	(11)	Manufacturer and Distributor of Health Care Equipment & Supplies
			Secured Debt	(9)	8/21/2019		7.00% (L+6.00%, Floor 1.00%)	8/21/2024		4,034		3,989		3,658
			Secured Debt	(19)	11/15/2021		15.00% PIK	11/8/2022		1,000		1,004		1,004
			Common Stock		8/21/2019	472,579						4,429		-
												9,422		4,662
JTI Electrical & Mechanical, LLC	(10)	Electrical, Mechanical and Automation Services
			Secured Debt	(9)	12/22/2021		7.00% (L+6.00%, Floor 1.00%)	12/22/2026		37,895		36,972		36,972
			Common Equity		12/22/2021	1,684,211						1,684		1,684
												38,656		38,656
Klein Hersh, LLC	(10)	Executive and C-Suite Placement for the Life Sciences and Healthcare Industries
			Secured Debt	(9)	11/13/2020		7.75% (L+7.00%, Floor 0.75%)	11/13/2025		43,321		42,342		43,278

KMS, LLC	(10)	Wholesaler of Closeout and Value-priced Products
			Secured Debt	(9)	10/4/2021		8.25% (L+7.25%, Floor 1.00%)	10/4/2026		7,581		7,415		7,415

Kore Wireless Group Inc.	(11) (13)	Mission Critical Software Platform
			Secured Debt		12/31/2018		5.72% (L+5.50%)	12/20/2024		11,415		11,345		11,400

Laredo Energy, LLC	(10)	Oil & Gas Exploration & Production
			Member Units		5/4/2020	1,155,952						11,560		9,659

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2021

(dollars in thousands)


Portfolio Company (1) (20)		Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)
LaserAway Intermediate Holdings II, LLC	(11)	Aesthetic Dermatology Service Provider
			Secured Debt	(9)	10/18/2021		6.50% (L+5.75%, Floor 0.75%)	10/14/2027		4,130		4,050		4,115

Lightbox Holdings, L.P.	(11)	Provider of Commercial Real Estate Software
			Secured Debt		5/23/2019		5.22% (L+5.00%)	5/9/2026		14,625		14,460		14,442

LKCM Headwater Investments I, L.P.	(12) (13)	Investment Partnership
			LP Interests	(8) (31)	1/25/2013	2.3%						1,746		2,541

LL Management, Inc.	(10)	Medical Transportation Service Provider
			Secured Debt	(9)	5/2/2019		8.25% (L+7.25%, Floor 1.00%)	9/25/2023		17,438		17,309		17,438

LLFlex, LLC	(10)	Provider of Metal-Based Laminates
			Secured Debt	(9)	8/16/2021		10.00% (L+9.00%, Floor 1.00%)	8/16/2026		4,478		4,382		4,382

Logix Acquisition Company, LLC	(10)	Competitive Local Exchange Carrier
			Secured Debt	(9)	1/8/2018		6.75% (L+5.75%, Floor 1.00%)	12/22/2024		25,850		24,605		24,428

Looking Glass Investments, LLC	(12) (13)	Specialty Consumer Finance
			Member Units		7/1/2015	3						125		25

Mac Lean-Fogg Company	(10)	Manufacturer and Supplier for Auto and Power Markets
			Secured Debt	(9)	4/22/2019		5.88% (L+5.25%, Floor 0.625%)	12/22/2025		17,080		16,995		17,080
			Preferred Stock	(19)	10/1/2019		13.75% (4.50% Cash, 9.25% PIK)					1,920		1,920
												18,915		19,000
Mako Steel, LP	(10)	Self-Storage Design & Construction
			Secured Debt	(9)	3/15/2021		8.00% (L+7.25%, Floor 0.75%)	3/13/2026		17,589		17,267		17,589

MB2 Dental Solutions, LLC	(11)	Dental Partnership Organization
			Secured Debt	(9)	1/28/2021		7.00% (L+6.00%, Floor 1.00%)	1/29/2027		11,682		11,531		11,682

Mills Fleet Farm Group, LLC	(10)	Omnichannel Retailer of Work, Farm and Lifestyle Merchandise
			Secured Debt	(9)	10/24/2018		7.25% (L+6.25%, Floor 1.00%)	10/24/2024		17,781		17,563		17,781

NBG Acquisition Inc	(11)	Wholesaler of Home Décor Products
			Secured Debt	(9)	4/28/2017		6.50% (L+5.50%, Floor 1.00%)	4/26/2024		3,987		3,961		2,758

NinjaTrader, LLC	(10)	Operator of Futures Trading Platform
			Secured Debt	(9)	12/18/2019		7.25% (L+6.25%, Floor 1.00%)	12/18/2024		31,425		30,837		31,368

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2021

(dollars in thousands)


Portfolio Company (1) (20)		Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)
NNE Partners, LLC	(10)	Oil & Gas Exploration & Production
			Secured Debt	(19)	3/2/2017		9.37% (4.87% Cash, 4.50% PIK) (4.50% PIK + L+4.75%)	12/31/2023		24,781		24,709		23,154

Northstar Group Services, Inc	(11)	Commercial & Industrial Services
			Secured Debt	(9)	11/1/2021		6.50% (L+5.50%, Floor 1.00%)	11/12/2026		10,000		9,952		10,034

NTM Acquisition Corp.	(11)	Provider of B2B Travel Information Content
			Secured Debt	(9) (19)	7/12/2016		8.25% (7.25% Cash, 1.00% PIK) (1.00%PIK + L+6.25%, Floor 1.00%)	6/7/2024		4,598		4,598		4,552

NWN Corporation	(10)	Value Added Reseller and Provider of Managed Services to a Diverse Set of Industries
			Secured Debt	(9)	5/7/2021		7.50% (L+6.50%, Floor 1.00%)	5/7/2026		42,972		42,108		42,323

Ospemifene Royalty Sub LLC	(10)	Estrogen-Deficiency Drug Manufacturer and Distributor
			Secured Debt	(14)	7/8/2013		11.50%	11/15/2026		4,562		4,562		112

OVG Business Services, LLC	(10)	Venue Management Services
			Secured Debt	(9)	11/29/2021		7.25% (L+6.25%, Floor 1.00%)	11/19/2028		14,000		13,861		13,861

Project Eagle Holdings, LLC	(10)	Provider of Secure Business Collaboration Software
			Secured Debt	(9)	7/6/2020		7.75% (L+6.75%, Floor 1.00%)	7/6/2026		29,738		29,151		29,714

PT Network, LLC	(10)	Provider of Outpatient Physical Therapy and Sports Medicine Services
			Secured Debt	(9) (19)	10/12/2017		8.50% (6.50% Cash, 2.00% PIK) (2.00% PIK + L+5.50%, Floor 1.00%)	11/30/2023		8,889		8,889		8,889
			Common Stock		1/1/2020	2						-		80
												8,889		8,969
RA Outdoors LLC	(10)	Software Solutions Provider for Outdoor Activity Management
			Secured Debt	(9)	4/8/2021		7.75% (L+6.75%, Floor 1.00%)	4/8/2026		19,374		19,193		18,352

Research Now Group, Inc. and Survey Sampling International, LLC	(11)	Provider of Outsourced Online Surveying
			Secured Debt	(9)	12/29/2017		6.50% (L+5.50%, Floor 1.00%)	12/20/2024		20,124		19,789		19,899

RM Bidder, LLC	(10)	Scripted and Unscripted TV and

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2021

(dollars in thousands)


Portfolio Company (1) (20)		Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)
		Digital Programming Provider
			Member Units		11/12/2015	2,779						46		26
			Warrants	(26)	11/12/2015	187,161		10/20/2025				425		-
												471		26
Roof Opco, LLC	(10)	Residential Re-Roofing/Repair
			Secured Debt	(9)	8/27/2021		7.00% (L+6.00%, Floor 1.00%)	8/27/2026		2,800		2,704		2,704

RTIC Subsidiary Holdings, LLC	(10)	Direct-To-Consumer eCommerce Provider of Outdoor Products
			Secured Debt	(9)	9/1/2020		9.00% (L+7.75%, Floor 1.25%)	9/1/2025		18,191		17,997		18,191

Rug Doctor, LLC.	(10)	Carpet Cleaning Products and Machinery
			Secured Debt	(9)	7/16/2021		7.25% (L+6.25%, Floor 1.00%)	11/16/2024		11,145		10,902		10,902

Salient Partners L.P.	(11)	Provider of Asset Management Services
			Secured Debt	(9)	8/31/2018		7.00% (L+6.00%, Floor 1.00%)	10/30/2022		6,251		6,247		4,063
			Secured Debt	(9)	9/30/2021		6.00% (L+5.00%, Floor 1.00%)	10/30/2022		1,250		1,250		2,435
												7,497		6,498
Savers, Inc.	(11)	For-Profit Thrift Retailer
			Secured Debt	(9)	5/14/2021		6.25% (L+5.50%, Floor 0.75%)	4/26/2028		11,400		11,295		11,386

SIB Holdings, LLC	(10)	Provider of Cost Reduction Services
			Secured Debt	(9)	10/29/2021		7.00% (L+6.00%, Floor 1.00%)	10/29/2026		6,282		6,134		6,145
			Common Equity		10/29/2021	95,238						200		200
												6,334		6,345
South Coast Terminals Holdings, LLC	(10)	Specialty Toll Chemical Manufacturer
			Secured Debt	(9)	12/10/2021		7.25% (L+6.25%, Floor 1.00%)	12/13/2026		50,704		49,589		49,589
			Common Equity		12/10/2021	863,636						864		864
												50,453		50,453
Staples Canada ULC	(10) (13) (21)	Office Supplies Retailer
			Secured Debt	(9) (22)	9/14/2017		8.00% (L+7.00%, Floor 1.00%)	9/12/2024		16,116		16,039		15,620

Stellant Systems, Inc.	(11)	Manufacturer of Traveling Wave Tubes and Vacuum Electronic Devices
			Secured Debt	(9)	10/22/2021		6.25% (L+5.50%, Floor 0.75%)	10/1/2028		7,700		7,625		7,700

Student Resource Center, LLC	(10)	Higher Education Services
			Secured Debt	(9)	6/25/2021		9.00% (L+8.00%, Floor 1.00%)	6/25/2026		10,969		10,753		10,826

Tacala Investment Corp.	(34)	Quick Service Restaurant Group

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2021

(dollars in thousands)


Portfolio Company (1) (20)		Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)
			Secured Debt	(9)	3/19/2021		4.25% (L+3.50%, Floor 0.75%)	2/5/2027		1,995		1,995		1,994

Team Public Choices, LLC	(11)	Home-Based Care Employment Service Provider
			Secured Debt	(9)	12/22/2020		6.00% (L+5.00%, Floor 1.00%)	12/18/2027		15,109		14,778		15,071

Tectonic Financial, LLC		Financial Services Organization
			Common Stock	(8)	5/15/2017	200,000						2,000		4,650

Tex Tech Tennis, LLC	(10)	Sporting Goods & Textiles
			Common Stock	(30)	7/7/2021	1,000,000						1,000		1,000

U.S. TelePacific Corp.	(11)	Provider of Communications and Managed Services
			Secured Debt	(9)	5/17/2017		7.00% (L+6.00%, Floor 1.00%)	5/2/2023		17,088		16,985		12,917

USA DeBusk LLC	(10)	Provider of Industrial Cleaning Services
			Secured Debt	(9)	10/22/2019		6.75% (L+5.75%, Floor 1.00%)	9/8/2026		37,281		36,510		37,281

Veregy Consolidated, Inc.	(11)	Energy Service Company
			Secured Debt	(9)	11/9/2020		6.25% (L+5.25, Floor 1.00%)	11/3/2025		5,875		5,111		5,111
			Secured Debt	(9)	11/9/2020		7.00% (L+6.00%, Floor 1.00%)	11/3/2027		14,888		14,524		14,925
												19,635		20,036
Vida Capital, Inc	(11)	Alternative Asset Manager
			Secured Debt		10/10/2019		6.10% (L+6.00%)	10/1/2026		17,089		16,905		15,850

Vistar Media, Inc.	(10)	Operator of Digital Out-of-Home Advertising Platform
			Preferred Stock		4/3/2019	70,207						767		1,726

VORTEQ Coil Finishers, LLC	(10)	Specialty Coating of Aluminum and Light-Gauge Steel
			Secured Debt	(9)	11/30/2021		8.50% (L+7.50%, Floor 1.00%)	11/30/2026		25,962		25,450		25,450
			Common Equity		11/30/2021	1,038,462						1,038		1,038
												26,488		26,488
Wahoo Fitness Acquisition L.L.C.	(11)	Fitness Training Equipment Provider
			Secured Debt	(9)	8/17/2021		6.75% (L+5.75%, Floor 1.00%)	8/12/2028		15,000		14,569		14,916

Wall Street Prep, Inc.	(10)	Financial Training Services
			Secured Debt	(9)	7/19/2021		8.00% (L+7.00%, Floor 1.00%)	7/19/2026		4,373		4,288		4,285
			Common Stock		7/19/2021	400,000						400		400
												4,688		4,685
Watterson Brands, LLC	(10)	Facility Management Services
			Secured Debt	(9)	12/17/2021		7.25% (L+6.25%, Floor 1.00%)	12/17/2026		25,876		25,267		25,267

Winter Services LLC	(10)	Provider of Snow Removal and Ice Management Services

Table of Contents

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2021

(dollars in thousands)


Portfolio Company (1) (20)		Business Description	Type of Investment (2) (3) (15)		Investment Date (24)	Shares/Units	Rate	Maturity Date	Principal (4)		Cost (4)		Fair Value (18)
			Secured Debt	(9)	11/19/2021		8.00% (L+7.00%, Floor 1.00%)	11/19/2026		10,278		10,018		10,061

Xenon Arc, Inc.	(10)	Tech-enabled Distribution Services to Chemicals and Food Ingredients Primary Producers
			Secured Debt	(9)	12/17/2021		6.75% (L+6.00%, Floor 0.75%)	12/17/2026		38,600		37,423		37,423

YS Garments, LLC	(11)	Designer and Provider of Branded Activewear
			Secured Debt	(9)	8/22/2018		6.50% (L+5.50%, Floor 1.00%)	8/9/2024		13,034		12,967		12,578
Subtotal Non-Control/Non-Affiliate Investments (85.2% of net assets at fair value)											$	1,573,110	$	1,523,360
Total Portfolio Investments, December 31, 2021 (199.2% of net assets at fair value)											$	3,259,246	$	3,561,831


(1)	All investments are Lower Middle Market portfolio investments, unless otherwise noted. See Note C—Fair Value Hierarchy for Investments—Portfolio Composition 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 by footnote (8), as described below.
(3)	See Note C—Fair Value Hierarchy for Investments—Portfolio Composition 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 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 every one, three, or six months at the borrower’s option. As noted in this schedule, 67% 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 1.06%.
(10)	Private Loan portfolio investment. See Note C—Fair Value Hierarchy for Investments—Portfolio Composition for a description of Private Loan portfolio investments.
(11)	Middle Market portfolio investment. See Note C—Fair Value Hierarchy for Investments—Portfolio Composition for a description of Middle Market portfolio investments.
(12)	Other Portfolio investment. See Note C—Fair Value Hierarchy for Investments—Portfolio Composition 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)	All of the Company’s portfolio investments are generally subject to restrictions on resale as “restricted securities.”

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MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments (Continued)

December 31, 2021

(dollars in thousands)

(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—Fair Value Hierarchy for Investments—Portfolio Composition 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 $21.4 million Canadian Dollars and receive $16.9 million U.S. Dollars with a settlement date of September 14, 2022. The unrealized depreciation on the forward foreign currency contract was not significant as of December 31, 2021.
(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 7.25% (Floor 1.25%) per the credit agreement and the Consolidated Schedule of Investments above reflects such higher rate.
(24)	Investment date represents the date of initial investment in the security position.
(25)	Warrants are presented in equivalent shares with a strike price of $10.92 per share.
(26)	Warrants are presented in equivalent units with a strike price of $14.28 per unit.
(27)	Warrants are presented in equivalent shares/units with a strike price of $0.01 per share/unit.
(28)	Warrants are presented in equivalent shares with a strike price of $0.001 per share.
(29)	Warrants are presented in equivalent units with a strike price of $1.50 per unit.
(30)	Shares/Units represent ownership in a related Real Estate or HoldCo entity.
(31)	Investment is not unitized. Presentation is made in percent of fully diluted ownership unless otherwise indicated.
(32)	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.
(33)	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 7.96% (Floor 1.00%) per the credit agreement and the Consolidated Schedule of Investments above reflects such higher rate.
(34)	Short-term portfolio investments. See Note C—Fair Value Hierarchy for Investments—Portfolio Composition for a description of short-term portfolio investments.
(35)	The security has an effective contractual interest rate of 2.00% PIK + LIBOR+6.50%, Floor 1.00%, but the issuer may, in its discretion, elect to pay the PIK interest in cash. The rate presented represents the effective current yield based on actual payments received during the period.
(36)	As of December 31, 2021, borrowings under the loan facility bear interest at LIBOR+6.00% or Prime+5.00%. Delayed draw term loan facility permits the borrower to make an interest rate election on each new tranche of borrowings under the facility. The rate presented represents a weighted-average rate for borrowings under the facility.

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MAIN STREET CAPITAL CORPORATION

Notes to the 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 investment strategy. 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”). 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.

MSCC wholly owns several investment funds, including Main Street Mezzanine Fund, LP (“MSMF”) and Main Street Capital III, LP (“MSC III” and, together with MSMF, 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”).

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 does 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.

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

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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 Private Loan portfolio companies, investments in Middle Market portfolio companies, Other Portfolio investments and the investment in the External Investment Manager (see Note C—Fair Value Hierarchy for Investments—Portfolio Composition—Investment Portfolio Composition for additional discussion of Main Street’s Investment Portfolio and definitions for the defined terms Private Loan and Other Portfolio). Main Street’s results of operations for the three and six months ended June 30, 2022 and 2021, cash flows for the six months ended June 30, 2022 and 2021, and financial position as of June 30, 2022 and December 31, 2021, 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. 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, 2021. 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 and six months ended June 30, 2022 are not necessarily indicative of the operating results to be expected for the full year. 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.

Principles of Consolidation

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 none of its portfolio investments qualify for this exception, including the investment in the External Investment Manager. Therefore, Main Street’s Investment Portfolio is carried on the Consolidated Balance Sheets at fair value, as discussed further in Note B.1.—Summary of Significant Accounting Policies—Valuation of the Investment Portfolio, with any adjustments to fair value recognized as “Net Unrealized Appreciation (Depreciation)” until the investment is realized, usually upon exit, resulting in any gain or loss being recognized as a “Net Realized Gain (Loss)”, in both cases on the Consolidated Statements of Operations.

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. For purposes of determining the classification of its Investment Portfolio, Main Street has excluded consideration of any voting securities or board appointment rights held by third-party investment funds advised by the External Investment Manager.

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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 debt securities issued by Middle Market companies that are generally larger in size than the LMM companies and that can be more liquid than the debt securities issued by 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 directly by Main Street or 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 made in companies that are consistent with the size of companies Main Street invests in through 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, Private Loan portfolio investments or Middle Market portfolio investments, including investments which may be managed by third parties. Main Street’s portfolio may also include short-term portfolio investments that are atypical of Main Street’s LMM, Private Loan and Middle Market portfolio investments in that they are intended to be a short-term deployment of capital and are more liquid than investments within the other portfolios. 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 and short-term portfolio investments 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, with such 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 investments and an income approach using a yield-to-maturity model (“Yield-to-Maturity”) valuation method for its LMM debt investments. For Middle Market and short-term 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 Private Loan and Middle Market 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

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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 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, changes in market-based interest rates 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.

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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 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 36 LMM portfolio companies for the six months ended June 30, 2022, representing 54% of the total LMM portfolio at fair value as of June 30, 2022, and on a total of 31 LMM portfolio companies for the six months ended June 30, 2021, representing 52% of the total LMM portfolio at fair value as of June 30, 2021. Excluding its investments in LMM portfolio companies that, as of June 30, 2022 and 2021, 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 Main Street’s independent financial advisory services firm for the six months ended June 30, 2022 and 2021 was 61% and 55% of the total LMM portfolio at fair value as of June 30, 2022 and 2021, respectively.

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 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 29 Private Loan portfolio companies for the six months ended June 30, 2022, representing 44% of the total Private Loan portfolio at fair value as of June 30, 2022, and on a total of 26 Private Loan portfolio companies for the six months ended June 30, 2021, representing 45% of the total Private Loan portfolio at fair value as of June 30, 2021. Excluding its investments in Private Loan portfolio companies that, as of June 30, 2022 and 2021, 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 Main Street’s independent financial advisory services firm for the six months ended June 30, 2022 and 2021 was 67% and 60% of the total Private Loan portfolio at fair value as of June 30, 2022 and 2021, 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

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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. The Company generally consults on a limited basis with a financial advisory services firm in connection with determining the fair value of its Middle Market portfolio investments due to the nature of these investments. The vast majority (92% and 93% as of June 30, 2022 and December 31, 2021, respectively) of the Middle Market portfolio investments (i) are valued using third-party quotes or other independent pricing services, (ii) have received an assurance certification from independent financial services firm within the last twelve months or (iii) are new investments that have not been in the Investment Portfolio for at least twelve months subsequent to the initial investment.

For valuation purposes, all of Main Street’s short-term 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. Because all of the short-term portfolio investments are typically valued using third-party quotes or other independent pricing services, Main Street generally does not consult with any financial advisory services firms in connection with determining the fair value of its short-term portfolio investments.

For valuation purposes, all of Main Street’s Other Portfolio investments are non-control investments. Main Street’s Other Portfolio investments comprised 2.9% and 4.7% of Main Street’s Investment Portfolio at fair value as of June 30, 2022 and December 31, 2021, 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, Private Loan and Middle Market portfolio companies. This system takes into account both quantitative and qualitative factors of the LMM, Private Loan and Middle Market portfolio company.

In December 2020, the SEC adopted Rule 2a-5 under the 1940 Act, which permits a BDC’s board of directors to designate its executive officers or investment adviser as a valuation designee to determine the fair value for its investment portfolio, subject to the active oversight of the board. Main Street’s Board of Directors has approved policies and procedures pursuant to Rule 2a-5 (the “Valuation Procedures”) and has designated a group of its executive officers to serve as the Board of Directors’ valuation designee. Main Street adopted the Valuation Procedures effective April 1, 2021. Main Street believes its Investment Portfolio as of June 30, 2022 and December 31, 2021 approximates fair value as of those dates based on the markets in which it operates and other conditions in existence on those reporting dates.

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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.—Summary of Significant Accounting Policies—Valuation of the Investment Portfolio, the consolidated financial statements include investments in the Investment Portfolio whose values have been estimated by Main Street, pursuant to valuation policies and procedures approved and overseen 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.

Macroeconomic factors, including the COVID-19 pandemic, risk of recession, inflation, supply chain constraints or disruptions and rising interest rates, and the related effect on the U.S. and global economies, have impacted, and may continue to impact, the businesses and operating results of certain of Main Street’s portfolio companies, as well as market interest rate spreads. As a result of these and other current effects of macroeconomic factors, as well as the uncertainty regarding the extent and duration of their impact, the valuation of Main Street’s Investment Portfolio has and may continue to experience increased volatility.

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 June 30, 2022, cash balances totaling $40.9 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 its debt obligation, 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 obligation, or if a loan or debt security is sold or written off, Main Street removes it from non-accrual status.

As of June 30, 2022, Main Street’s total Investment Portfolio had nine investments on non-accrual status, which comprised 0.7% of its fair value and 3.2% of its cost. As of December 31, 2021, Main Street’s total Investment Portfolio had nine investments on non-accrual status, which comprised 0.7% of its fair value and 3.3% 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. —Summary of Significant Accounting Policies—Income Taxes 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

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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 June 30, 2022 and 2021, (i) 1.7% and 3.4%, respectively, of Main Street’s total investment income was attributable to PIK interest income not paid currently in cash and (ii) 0.2% and 0.6%, respectively, of Main Street’s total investment income was attributable to cumulative dividend income not paid currently in cash. For the six months ended June 30, 2022 and 2021, (i) 1.4% and 3.6%, respectively, of Main Street’s total investment income was attributable to PIK interest income not paid currently in cash and (ii) 0.6% and 0.7%, 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				Six Months Ended
	June 30,				June 30,
	2022		2021		2022		2021

	(dollars in thousands)
Interest, fee and dividend income:
Interest income	$	63,984	$	45,944	$	123,426	$	89,416
Dividend income		17,913		18,619		34,535		36,316
Fee income		3,303		2,731		6,635		4,370
Total interest, fee and dividend income	$	85,200	$	67,294	$	164,596	$	130,102

5. Deferred Financing Costs

Deferred financing costs include commitment fees and other direct 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 (3.4% of the total commitment and draw amounts, as applicable) on the SBIC debentures. See further discussion of Main Street’s debt in Note E—Debt. Deferred financing costs in connection with the Credit Facility are capitalized as an asset. Deferred financing costs in connection with all other debt arrangements are a direct deduction from the principal amount outstanding.

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 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

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netted against the applicable debt investment, and accreted into interest income 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 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 over the life of the debt investment.

To maintain RIC tax treatment (as discussed in Note B.9.—Summary of Significant Accounting Policies—Income Taxes 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 June 30, 2022 and 2021, 2.0% and 2.4%, 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. For the six months ended June 30, 2022 and 2021, 2.0% and 2.4%, 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.

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 twelve 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

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Taxable Subsidiaries are each taxed at corporate income 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.

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 corporate income 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. Main Street’s net assets as included on the Consolidated Balance Sheets and Consolidated Statements of Changes in Net Assets include an adjustment to classification as a result of permanent book-to-tax differences, which include differences in the book and tax treatment of income and expenses.

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.

To estimate the fair value of Main Street’s multiple tranches of unsecured debt instruments as disclosed in Note E – Debt, Main Street uses quoted market prices. For the estimated fair value of Main Street’s SBIC debentures, Main Street uses the Yield-to-Maturity valuation method based on projections of the discounted future free cash flows that the debt security will likely generate, including both the discounted cash flows of the associated interest and principal amounts for the debt security.

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,

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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 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 when LIBOR reference is no longer used. The Company utilized the optional expedients and exceptions provided by ASU 2020-04 during the six months ended June 30, 2022, the effect of which was not material to the consolidated financial statements and the notes thereto. The Company continues to evaluate the potential impact that the amendments in this update will have on its consolidated financial statements and disclosures.

In December 2021, the SEC published Staff Accounting Bulletin No. 120 (“SAB 120”) to provide accounting and disclosure guidance for stock compensation awards made to executives and conforming amendments to the Staff Accounting Bulletin Series to align with the current authoritative accounting guidance in ASC 718, Compensation – Stock Compensation. In part, SAB 120 requires that an entity disclose how it determines the current price of underlying shares for grant-date fair value, the policy for when an adjustment to the share price is required, how it determines the amount of an adjustment to the share price and any significant assumptions used in determining an adjustment to the share price. SAB 120 is effective for all stock compensation awards issued after December 1, 2021. Main Street is in compliance with the guidance pursuant to SAB 120 for any share-based compensation disclosures. See Note J – Share-Based Compensation for further discussion of Main Street’s policies and procedures regarding share-based compensation. The impact of SAB 120 was not material to the consolidated financial statements and the notes thereto.

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.

NOTE C—FAIR VALUE HIERARCHY FOR INVESTMENTS—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).

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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).

As of June 30, 2022 and December 31, 2021, all of Main Street’s LMM portfolio investments consisted of illiquid securities issued by privately held companies and the fair value determination for these investments primarily consisted of unobservable inputs. As a result, all of Main Street’s LMM portfolio investments were categorized as Level 3 as of June 30, 2022 and December 31, 2021.

As of June 30, 2022 and December 31, 2021, 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 June 30, 2022 and December 31, 2021.

As of June 30, 2022 and December 31, 2021, 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 June 30, 2022 and December 31, 2021.

As of June 30, 2022 and December 31, 2021, Main Street’s Other Portfolio investments consisted of illiquid securities issued by privately held companies and 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 June 30, 2022 and December 31, 2021.

As of June 30, 2022, Main Street held one short-term portfolio investment, which was a secured debt investment. The fair value determination for this investment consisted of available observable inputs in non-active markets sufficient to determine the fair value of the investment. As a result, Main Street’s short-term portfolio investment was categorized as Level 2 as of June 30, 2022. As of December 31, 2021, Main Street held one short-term portfolio investment, which was a secured debt investment. The fair value determination for this investment consisted of

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available observable inputs in non-active markets sufficient to determine the fair value of the investment. As a result, Main Street’s short-term portfolio investment was categorized as Level 2 as of December 31, 2021.

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;

●

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, Private Loan and Middle Market 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

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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 June 30, 2022 and December 31, 2021:


	Fair Value as of
	June 30,
Type of	2022			Significant		Weighted
Investment	(in thousands)		Valuation Technique	Unobservable Inputs	Range(3)	Average(3)		Median(3)
Equity investments	$	1,107,893	Discounted cash flow	WACC	9.5% - 22.1%	14.6	%	15.6	%
			Market comparable / Enterprise value	EBITDA multiple (1)	4.5x - 8.3x(2)	6.6x		6.0x
Debt investments	$	2,282,777	Discounted cash flow	Risk adjusted discount factor	6.8% - 15.0%(2)	10.4	%	10.6	%
				Expected principal recovery percentage	0.0% - 200.0%	99.4	%	100.0	%
Debt investments	$	325,239	Market approach	Third‑party quote	5.75 - 99.8	92.0		94.5
Total Level 3 investments	$	3,715,909

(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 2.2x - 15.7x and the range for risk adjusted discount factor is 5.0% - 38.5%.

(3)	Does not include investments for which the valuation technique does not include the use of the applicable fair value input.


	Fair Value as of
	December 31,
Type of	2021			Significant		Weighted
Investment	(in thousands)		Valuation Technique	Unobservable Inputs	Range(3)	Average(3)		Median(3)
Equity investments	$	1,050,269	Discounted cash flow	WACC	9.1% - 20.6%	13.8	%	14.8	%
			Market comparable / Enterprise value	EBITDA multiple (1)	4.8x - 7.7x(2)	6.6x		5.9x
Debt investments	$	2,158,424	Discounted cash flow	Risk adjusted discount factor	5.6% - 15.7%(2)	9.8	%	9.3	%
				Expected principal recovery percentage	0.0% - 100.0%	99.6	%	100.0	%
Debt investments	$	351,144	Market approach	Third‑party quote	3.0 - 100.5	94.4		99.0
Total Level 3 investments	$	3,559,837

(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 2.2x - 11.0x and the range for risk adjusted discount factor is 4.2% - 38.5%.

(3)	Does not include investments for which the valuation technique does not include the use of the applicable fair value input.

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The following tables provide a summary of changes in fair value of Main Street’s Level 3 portfolio investments for the six-month periods ended June 30, 2022 and 2021 (amounts in thousands):


									Net
	Fair Value		Transfers						Changes		Net				Fair Value
	as of		Into						from		Unrealized				as of
Type of	December 31,		Level 3		Redemptions/		New		Unrealized		Appreciation				June 30,
Investment	2021		Hierarchy		Repayments		Investments		to Realized		(Depreciation)		Other(1)		2022
Debt	$	2,509,568	$	—	$	(351,315)	$	508,045	$	3,656	$	(60,605)	$	(1,333)	$	2,608,016
Equity		1,043,709		—		(27,338)		34,765		(1,977)		51,451		1,333		1,101,943
Equity Warrant		6,560		—		—		—		—		(610)		—		5,950
	$	3,559,837	$	—	$	(378,653)	$	542,810	$	1,679	$	(9,764)	$	—	$	3,715,909

(1)	Includes the impact of non-cash conversions. These transactions represent non-cash investing activities. See additional cash flow information in the Consolidated Statements of Cash Flows.


									Net
	Fair Value		Transfers						Changes		Net				Fair Value
	as of		Into						from		Unrealized				as of
Type of	December 31,		Level 3		Redemptions/		New		Unrealized		Appreciation				June 30,
Investment	2020		Hierarchy		Repayments		Investments		to Realized		(Depreciation)		Other(1)		2021
Debt	$	1,807,134	$	—	$	(282,896)	$	457,028	$	9,781	$	11,278	$	(3,485)	$	1,998,840
Equity		866,734		—		(49,565)		20,584		5,177		57,120		5,515		905,565
Equity Warrant		10,998		—		—		—		1,128		484		(2,030)		10,580
	$	2,684,866	$	—	$	(332,461)	$	477,612	$	16,086	$	68,882	$	—	$	2,914,985

(1)	Includes the impact of non-cash conversions. These transactions represent non-cash investing activities. See additional cash flow information in the Consolidated Statements of Cash Flows.

At June 30, 2022 and December 31, 2021, Main Street’s investments at fair value were categorized as follows in the fair value hierarchy for ASC 820 purposes:


			Fair Value Measurements
			(in thousands)
			Quoted Prices in				Significant
			Active Markets for		Significant Other		Unobservable
			Identical Assets		Observable Inputs		Inputs
At June 30, 2022	Fair Value		(Level 1)		(Level 2)		(Level 3)
LMM portfolio investments	$	1,816,255	$	—	$	—	$	1,816,255
Private Loan portfolio investments		1,309,020		—		—		1,309,020
Middle Market portfolio investments		363,468		—		—		363,468
Other Portfolio investments		108,846		—		—		108,846
External Investment Manager		118,320		—		—		118,320
Short-term portfolio investments		1,861		—		1,861		—
Total investments	$	3,717,770	$	—	$	1,861	$	3,715,909


			Fair Value Measurements
			(in thousands)
			Quoted Prices in				Significant
			Active Markets for		Significant Other		Unobservable
			Identical Assets		Observable Inputs		Inputs
At December 31, 2021	Fair Value		(Level 1)		(Level 2)		(Level 3)
LMM portfolio investments	$	1,716,415	$	—	$	—	$	1,716,415
Private Loan portfolio investments		1,141,772		—		—		1,141,772
Middle Market portfolio investments		395,167		—		—		395,167
Other Portfolio investments		166,083		—		—		166,083
External Investment Manager		140,400		—		—		140,400
Short-term portfolio investments		1,994		—		1,994		—
Total investments	$	3,561,831	$	—	$	1,994	$	3,559,837

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Investment Portfolio Composition

Main Street’s principal investment objective is to maximize its portfolio’s total return by generating current income from its debt investments and current income and capital appreciation from its equity and equity-related investments, including warrants, convertible securities and other rights to acquire equity securities in a portfolio company. Main Street seeks to achieve its investment objective through its LMM, Private Loan and Middle Market investment strategies.

Main Street’s LMM investment strategy involves investments in 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 $75 million. The LMM debt investments are typically secured by a first 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 private loan (“Private Loan”) investment strategy involves investments in privately held companies that are generally consistent with the size of its LMM portfolio companies or Middle Market portfolio companies, and its Private Loan investments generally range in size from $10 million to $75 million. Main Street’s Private Loan investments generally consist of loans that have been originated directly by Main Street or through strategic relationships with other investment funds on a collaborative basis, and are often referred to in the debt markets as “club deals.” Main Street’s Private Loan portfolio debt investments are generally secured by a first 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 may have the option to invest alongside the sponsor in the equity securities of its Private Loan portfolio companies.

Main Street’s Middle Market investment strategy involves investments in syndicated loans to or debt securities in Middle Market companies, which Main Street defines as companies with annual revenues between $150 million and $1.5 billion, and its Middle Market investments generally range in size from $3 million to $25 million. Main Street’s Middle Market portfolio debt investments are generally secured by a first 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.

Main Street’s other portfolio (“Other Portfolio”) investments primarily consist of investments that are not consistent with the typical profiles for its LMM, Private Loan or Middle Market portfolio 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.

Based upon Main Street’s liquidity and capital structure management activities, Main Street’s Investment Portfolio may also include short-term portfolio investments that are atypical of Main Street’s LMM, Private Loan and Middle Market portfolio investments in that they are intended to be a short-term deployment of capital. Those assets are typically expected to be liquidated in one year or less. These short-term investments are not expected to be a significant portion of the overall Investment Portfolio.

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 under management for external parties and may earn incentive fees, or a carried interest, based on the performance of the assets 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 MSC Income Fund, Inc. (“MSC 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 the three months ended June 30, 2022 and 2021 are net of expenses allocated to the External Investment Manager of $3.5 million and $2.6 million, respectively, and for the six months ended June 30, 2022 and 2021 of $6.3 million and $5.0 million, respectively.

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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 and six months ended June 30, 2022 and 2021, 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, Private Loan and Middle Market portfolios as of June 30, 2022 and December 31, 2021 (this information excludes the Other Portfolio, short-term portfolio investments and the External Investment Manager, which are discussed further below):


	As of June 30, 2022
	LMM (a)			Private Loan			Middle Market

	(dollars in millions)
Number of portfolio companies		75			82			34
Fair value	$	1,816.3		$	1,309.0		$	363.5
Cost	$	1,508.9		$	1,347.9		$	419.0
Debt investments as a % of portfolio (at cost)		71.9	%		96.1	%		92.9	%
Equity investments as a % of portfolio (at cost)		28.1	%		3.9	%		7.1	%
% of debt investments at cost secured by first priority lien		99.0	%		99.4	%		99.2	%
Weighted-average annual effective yield (b)		11.2	%		8.5	%		8.0	%
Average EBITDA (c)	$	7.5		$	41.2		$	71.4

(a)	At June 30, 2022, Main Street had equity ownership in all of its LMM portfolio companies, and the average fully diluted equity ownership in those portfolio companies was 41%.

(b)

The weighted-average annual effective yields were computed using the effective interest rates for all debt investments at cost as of June 30, 2022, 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 on Main Street’s debt portfolio as of June 30, 2022 including debt investments on non-accrual status was 10.5% for its LMM portfolio, 8.3% for its Private Loan portfolio and 7.6% for its Middle Market portfolio. The weighted-average annual effective yield is not reflective of what an investor in shares of Main Street’s common stock will realize on its investment because it does not reflect changes in the market value of Main Street’s stock, Main Street’s utilization of debt capital in its capital structure, 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 Private Loan and Middle Market portfolios. These calculations exclude certain portfolio companies, including three LMM 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 December 31, 2021
	LMM (a)			Private Loan			Middle Market

	(dollars in millions)
Number of portfolio companies		73			75			36
Fair value	$	1,716.4		$	1,141.8		$	395.2
Cost	$	1,455.7		$	1,157.5		$	440.9
Debt investments as a % of portfolio (at cost)		70.9	%		95.7	%		93.3	%
Equity investments as a % of portfolio (at cost)		29.1	%		4.3	%		6.7	%
% of debt investments at cost secured by first priority lien		99.0	%		98.7	%		98.7	%
Weighted-average annual effective yield (b)		11.2	%		8.2	%		7.5	%
Average EBITDA (c)	$	6.2		$	41.3		$	76.0

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(a)	At December 31, 2021, Main Street had equity ownership in all of its LMM portfolio companies, and the average fully diluted equity ownership in those portfolio companies was 40%.

(b)

The weighted-average annual effective yields were computed using the effective interest rates for all debt investments at cost as of December 31, 2021, 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 on Main Street’s debt portfolio as of December 31, 2021 including debt investments on non-accrual status was 10.6% for its LMM portfolio, 8.0% for its Private Loan portfolio and 6.9% for its Middle Market portfolio. The weighted-average annual effective yield is not reflective of what an investor in shares of Main Street’s common stock will realize on its investment because it does not reflect changes in the market value of Main Street’s stock, Main Street’s utilization of debt capital in its capital structure, 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 Private Loan and Middle Market portfolios. These calculations exclude certain portfolio companies, including three LMM portfolio companies, three Private Loan portfolio companies and one Middle Market portfolio company, 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.

For the three months ended June 30, 2022 and 2021, Main Street achieved an annualized total return on investments of 6.5% and 19.7%, respectively. For the six months ended June 30, 2022 and 2021, Main Street achieved an annualized total return on investments of 9.2% and 16.0%, respectively. For the year ended December 31, 2021, Main Street achieved an annualized total return on investments of 16.6%. Total return on investments is calculated using the interest, dividend and fee income, as well as the realized and unrealized change in fair value of the Investment Portfolio for the specified period. Main Street’s total return on investments is not reflective of what an investor in shares of Main Street’s common stock will realize on its investment because it does not reflect changes in the market value of Main Street’s stock, Main Street’s utilization of debt capital in its capital structure, Main Street’s expenses or any sales load paid by an investor.

As of June 30, 2022, Main Street had Other Portfolio investments in 14 companies, collectively totaling $108.8 million in fair value and $116.1 million in cost basis and which comprised 2.9% and 3.4% of Main Street’s Investment Portfolio at fair value and cost, respectively. As of December 31, 2021, Main Street had Other Portfolio investments in 13 companies, collectively totaling $166.1 million in fair value and $173.7 million in cost basis and which comprised 4.7% and 5.3% of Main Street’s Investment Portfolio at fair value and cost, respectively.

As of June 30, 2022, Main Street had one short-term portfolio investment, which was a secured debt investment that had $1.9 million in fair value and $2.0 million in cost basis and which comprised 0.1% of Main Street’s Investment Portfolio at both fair value and cost. As of December 31, 2021, Main Street had one short-term portfolio investment, which was a secured debt investment that had $2.0 million in both fair value and cost basis and which comprised 0.1% of Main Street’s Investment Portfolio at both fair value and cost.

As discussed further in Note A.1—Organization and Basis of Presentation—Organization, Main Street holds an investment in the External Investment Manager, a wholly-owned subsidiary that is treated as a portfolio investment. As of June 30, 2022, this investment had a fair value of $118.3 million and a cost basis of $29.5 million, which comprised 3.2% and 0.9% of Main Street’s Investment Portfolio at fair value and cost, respectively. As of December 31, 2021, this investment had a fair value of $140.4 million and a cost basis of $29.5 million, which comprised 3.9% and 0.9% of Main Street’s Investment Portfolio at fair value and cost, respectively.

The following tables summarize the composition of Main Street’s total combined LMM portfolio investments, Private Loan portfolio investments and Middle Market portfolio investments at cost and fair value by type of investment as a percentage of the total combined LMM portfolio investments, Private Loan portfolio investments and Middle

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Market portfolio investments, as of June 30, 2022 and December 31, 2021 (this information excludes the Other Portfolio investments, short-term portfolio investments and the External Investment Manager, which are discussed above).


Cost:	June 30, 2022		December 31, 2021
First lien debt	83.9	%	82.5	%
Equity	15.2	%	16.2	%
Second lien debt	0.3	%	0.6	%
Equity warrants	0.2	%	0.3	%
Other	0.4	%	0.4	%
	100.0	%	100.0	%


Fair Value:	June 30, 2022		December 31, 2021
First lien debt	74.0	%	74.3	%
Equity	25.1	%	24.6	%
Second lien debt	0.3	%	0.5	%
Equity warrants	0.2	%	0.2	%
Other	0.4	%	0.4	%
	100.0	%	100.0	%

The following tables summarize the composition of Main Street’s total combined LMM portfolio investments, Private Loan portfolio investments and Middle Market 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, Private Loan portfolio investments and Middle Market portfolio investments, as of June 30, 2022 and December 31, 2021 (this information excludes the Other Portfolio, short-term portfolio investments and the External Investment Manager). The geographic composition is determined by the location of the corporate headquarters of the portfolio company.


Cost:	June 30, 2022		December 31, 2021
West	28.0	%	28.3	%
Northeast	21.1	%	22.6	%
Southwest	20.2	%	21.6	%
Midwest	15.5	%	15.1	%
Southeast	14.0	%	11.6	%
Canada	0.7	%	0.8	%
Other Non-United States	0.5	%	—	%
	100.0	%	100.0	%


Fair Value:	June 30, 2022		December 31, 2021
West	28.4	%	28.5	%
Southwest	21.4	%	23.0	%
Northeast	20.9	%	21.9	%
Midwest	15.9	%	15.8	%
Southeast	12.3	%	10.0	%
Canada	0.6	%	0.8	%
Other Non-United States	0.5	%	—	%
	100.0	%	100.0	%

Main Street’s LMM portfolio investments, Private Loan portfolio investments and Middle Market 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, Private Loan portfolio investments and

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Middle Market portfolio investments by industry at cost and fair value as of June 30, 2022 and December 31, 2021 (this information excludes the Other Portfolio, short-term portfolio investments and the External Investment Manager).


Cost:	June 30, 2022		December 31, 2021
Internet Software & Services	8.3	%	7.2	%
Machinery	7.6	%	7.3	%
Construction & Engineering	7.2	%	7.8	%
Commercial Services & Supplies	5.6	%	5.9	%
Diversified Consumer Services	5.2	%	3.4	%
Distributors	4.5	%	4.7	%
Leisure Equipment & Products	4.4	%	4.1	%
Health Care Providers & Services	4.2	%	3.9	%
Professional Services	4.1	%	4.6	%
Energy Equipment & Services	3.6	%	4.0	%
Specialty Retail	3.5	%	3.5	%
IT Services	3.5	%	3.5	%
Aerospace & Defense	2.6	%	1.9	%
Media	2.5	%	1.8	%
Building Products	2.2	%	2.3	%
Containers & Packaging	2.1	%	2.3	%
Textiles, Apparel & Luxury Goods	2.1	%	2.2	%
Communications Equipment	2.0	%	2.3	%
Diversified Financial Services	1.9	%	2.1	%
Tobacco	1.9	%	2.1	%
Diversified Telecommunication Services	1.8	%	2.6	%
Food Products	1.7	%	2.0	%
Software	1.7	%	1.8	%
Oil, Gas & Consumable Fuels	1.5	%	1.8	%
Internet & Catalog Retail	1.4	%	1.6	%
Health Care Equipment & Supplies	1.4	%	0.3	%
Food & Staples Retailing	1.3	%	0.8	%
Chemicals	1.3	%	1.7	%
Electronic Equipment, Instruments & Components	1.3	%	1.4	%
Hotels, Restaurants & Leisure	1.2	%	1.4	%
Computers & Peripherals	1.2	%	1.3	%
Electrical Equipment	1.0	%	0.7	%
Pharmaceuticals	1.0	%	0.1	%
Household Durables	0.9	%	1.0	%
Life Sciences Tools & Services	—	%	1.4	%
Other (1)	2.3	%	3.2	%
	100.0	%	100.0	%

(1)	Includes various industries with each industry individually less than 1.0% of the total combined LMM portfolio investments, Private Loan portfolio investments and Middle Market portfolio investments at each date.

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Fair Value:	June 30, 2022		December 31, 2021
Machinery	8.7	%	8.5	%
Diversified Consumer Services	7.4	%	5.9	%
Internet Software & Services	7.2	%	6.4	%
Construction & Engineering	6.8	%	7.7	%
Commercial Services & Supplies	5.1	%	5.5	%
Distributors	4.7	%	4.7	%
Specialty Retail	4.1	%	4.1	%
Leisure Equipment & Products	4.1	%	4.0	%
Professional Services	3.9	%	3.9	%
Health Care Providers & Services	3.9	%	3.6	%
IT Services	3.3	%	3.3	%
Media	3.1	%	2.2	%
Aerospace & Defense	2.4	%	1.7	%
Energy Equipment & Services	2.3	%	2.8	%
Containers & Packaging	2.3	%	2.5	%
Tobacco	2.2	%	2.2	%
Diversified Financial Services	2.1	%	2.3	%
Textiles, Apparel & Luxury Goods	2.1	%	2.1	%
Building Products	2.0	%	2.2	%
Software	2.0	%	2.0	%
Computers & Peripherals	1.9	%	2.2	%
Food Products	1.7	%	1.9	%
Diversified Telecommunication Services	1.6	%	2.5	%
Internet & Catalog Retail	1.5	%	1.5	%
Oil, Gas & Consumable Fuels	1.3	%	1.4	%
Food & Staples Retailing	1.2	%	0.8	%
Chemicals	1.2	%	1.6	%
Health Care Equipment & Supplies	1.2	%	0.1	%
Communications Equipment	1.1	%	1.5	%
Construction Materials	1.1	%	1.1	%
Electrical Equipment	1.0	%	0.8	%
Hotels, Restaurants & Leisure	0.9	%	1.0	%
Life Sciences Tools & Services	—	%	1.3	%
Other (1)	4.6	%	4.7	%
	100.0	%	100.0	%

(1)	Includes various industries with each industry individually less than 1.0% of the total combined LMM portfolio investments, Private Loan portfolio investments and Middle Market portfolio investments at each date.

At June 30, 2022 and December 31, 2021, 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 evaluating its unconsolidated controlled portfolio companies in accordance with Regulation S-X, there are two tests that Main Street must utilize to determine if any of Main Street’s Control Investments (as defined in Note A–Organization and Basis of Presentation, 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 and the income test. The investment test is generally measured by dividing Main Street’s investment in the Control Investment by the value of Main Street’s total investments. The income test is generally measured by dividing the absolute value of the combined sum of total investment income, net realized gain (loss) and net unrealized appreciation (depreciation) from the relevant Control Investment for the period being tested by the absolute value of Main Street’s change in net assets resulting from operations for the same period. Rules 3-

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09 and 4-08(g) of Regulation S-X require Main Street to include (1) 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 and (2) summarized financial information of a Control Investment in a quarterly report, respectively, if certain thresholds of the investment or income tests are exceeded and the unconsolidated portfolio company qualifies as a significant subsidiary.

As of June 30, 2022 and December 31, 2021, Main Street had no single investment that qualified as a significant subsidiary under either the investment or income tests.

NOTE D—EXTERNAL INVESTMENT MANAGER

As discussed further in Note A.1—Organization and Basis of Presentation—Organization and Note C—Fair Value Hierarchy for Investments—Portfolio Composition—Investment Portfolio Composition, 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.

The External Investment Manager serves as the investment adviser and administrator to MSC Income pursuant to an Investment Advisory and Administrative Services Agreement entered into in October 2020 between the External Investment Manager and MSC Income (the “Advisory Agreement”). Under the Advisory Agreement, the External Investment Manager earns a 1.75% annual base management fee on MSC Income’s average total assets, an incentive fee equal to 20% of pre-investment fee net investment income above a specified investment return hurdle rate and a 20% incentive fee on cumulative net realized capital gains in exchange for providing advisory services to MSC Income.

As described more fully in Note L – Related Party Transactions, the External Investment Manager also serves as the investment adviser and administrator to MS Private Loan Fund I, LP, a private investment fund with a strategy to co-invest with Main Street in Private Loan portfolio investments (the “Private Loan Fund”). The External Investment Manager entered into an Investment Management Agreement in December 2020 with the Private Loan Fund, pursuant to which the External Investment Manager provides investment advisory and management services to the Private Loan Fund in exchange for an asset-based fee and certain incentive fees. The External Investment Manager may also advise other clients, including funds and separately managed accounts, pursuant to advisory and services agreements with such clients in exchange for asset-based and incentive fees.

The External Investment Manager provides administrative services for certain External Party clients that, to the extent not waived, are reported as administrative services fees. The administrative services fees generally represent expense reimbursements for a portion of the compensation, overhead and related expenses for certain professionals directly attributable to performing administrative services for a client. These fees are recognized as other revenue in the period in which the related services are rendered.

During the three months ended June 30, 2022 and 2021, the External Investment Manager earned $5.4 million and $4.2 million, respectively, in base management fee income. During the three months ended June 30, 2022, the External Investment Manager earned $0.1 million in incentive fee income. No incentive fee income was earned in the three months ended June 30, 2021. During the three months ended June 30, 2022, the External Investment Manager earned $0.2 million in administrative services fee income. No administrative services fee income was earned in the three months ended June 30, 2021. During the six months ended June 30, 2022 and 2021, the External Investment Manager earned $10.9 million and $8.1 million, respectively, in base management fee income. During the six months ended June 30, 2022, the External Investment Manager earned $0.2 million in incentive fee income. No incentive fee income was earned in the six months ended June 30, 2021. During the six months ended June 30, 2022, the External Investment Manager earned $0.3 million in administrative services fee income. No administrative services fee income was earned in the six months ended June 30, 2021.

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.—Summary of Significant Accounting Policies—Valuation of the Investment Portfolio). Any change in fair value of the investment in the External Investment Manager is

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recognized on Main Street’s Consolidated Statements of Operations in “Net Unrealized Appreciation (Depreciation)—Control investments.”

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 corporate income 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 the three months ended June 30, 2022 and 2021, Main Street allocated $3.5 million and $2.6 million of total expenses, respectively, to the External Investment Manager. For the six months ended June 30, 2022 and 2021, Main Street allocated $6.3 million and $5.0 million of total expenses, respectively, 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 earned from the External Investment Manager. For the three months ended June 30, 2022 and 2021, the total contribution to Main Street’s net investment income was $5.2 million and $3.8 million, respectively. For the six months ended June 30, 2022 and 2021, the total contribution to Main Street’s net investment income was $10.3 million and $7.4 million, respectively.

Summarized financial information from the separate financial statements of the External Investment Manager as of June 30, 2022 and December 31, 2021 and for the three and six months ended June 30, 2022 and 2021 is as follows:


	As of		As of
	June 30,		December 31,
	2022		2021

	(dollars in thousands)
Cash	$	381	$	—
Accounts receivable - advisory clients		5,878		5,595
Intangible Asset		29,500		29,500
Total assets	$	35,759	$	35,095

Accounts payable to MSCC and its subsidiaries	$	4,549	$	3,288
Dividend payable to MSCC and its subsidiaries		1,710		2,307
Equity		29,500		29,500
Total liabilities and equity	$	35,759	$	35,095

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	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2022		2021		2022		2021

	(dollars in thousands)
Management fee income	$	5,421	$	4,212	$	10,865	$	8,115
Incentive fees		90		-		227		-
Administrative services fees		153		-		304		-
Total revenues		5,664		4,212		11,396		8,115
Expenses allocated from MSCC or its subsidiaries:
Salaries, share-based compensation and other personnel costs		(2,653)		(2,073)		(4,913)		(4,116)
Other G&A expenses		(809)		(499)		(1,366)		(836)
Total allocated expenses		(3,462)		(2,572)		(6,279)		(4,952)
Pre-tax income		2,202		1,640		5,117		3,163
Tax expense		(492)		(370)		(1,134)		(714)
Net income	$	1,710	$	1,270	$	3,983	$	2,449

NOTE E—DEBT

Summary of debt as of June 30, 2022 is as follows:


	Outstanding Balance		Unamortized Debt Issuance (Costs)/Premiums (2)		Recorded Value		Estimated Fair Value (1)

	(in thousands)
Credit Facility	$	380,000	$	—	$	380,000	$	380,000
3.00% Notes due 2026		500,000		(2,128)		497,872		437,595
5.20% Notes due 2024		450,000		999		450,999		448,637
SBIC Debentures		350,000		(6,677)		343,323		304,805
4.50% Notes due 2022		185,000		(253)		184,747		185,250
Total Debt	$	1,865,000	$	(8,059)	$	1,856,941	$	1,756,287

(1)	Estimated fair value for outstanding debt if Main Street had adopted the fair value option under ASC 825. See discussion of the methods used to estimate the fair value of Main Street’s debt in Note B.11.—Summary of Significant Accounting Policies—Fair Value of Financial Instruments.

(2)

The unamortized debt issuance costs for the Credit Facility are reflected as Deferred financing costs on the Consolidated Balance Sheets, while the deferred debt issuance costs related to the 3.00% Notes due 2026, 5.20% Notes due 2024, 4.50% Notes due 2022 and SBIC Debentures are reflected as contra-liabilities on the Consolidated Balance Sheets.

Summary of debt as of December 31, 2021 is as follows:

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	Outstanding Balance		Unamortized Debt Issuance (Costs)/Premiums (2)		Recorded Value		Estimated Fair Value (1)

		(in thousands)
Credit Facility	$	320,000	$	—	$	320,000	$	320,000
3.00% Notes due 2026		500,000		(2,391)		497,609		502,285
5.20% Notes due 2024		450,000		1,272		451,272		480,767
SBIC Debentures		350,000		(7,269)		342,731		328,206
4.50% Notes due 2022		185,000		(556)		184,444		190,043
Total Debt	$	1,805,000	$	(8,944)	$	1,796,056	$	1,821,301

(1)	Estimated fair value for outstanding debt if Main Street had adopted the fair value option under ASC 825. See discussion of the methods used to estimate the fair value of Main Street’s debt in Note B.11.—Summary of Significant Accounting Policies—Fair Value of Financial Instruments.

(2)

Summarized interest expense for the three and six months ended June 30, 2022 and 2021is as follows (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Credit Facility	$	2,640	$	1,408	$	4,698	$	2,374
3.00% Notes due 2026		3,882		2,489		7,763		4,638
5.20% Notes due 2024		5,713		5,713		11,428		11,430
SBIC Debentures		2,827		2,557		5,627		5,298
4.50% Notes due 2022		2,233		2,233		4,466		4,466
Total Interest Expense	$	17,295	$	14,400	$	33,982	$	28,206

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 $350.0 million at both June 30, 2022 and December 31, 2021. SBIC debentures provide for interest to be paid semiannually, with principal due at the applicable 10-year maturity date of each debenture. Main Street expects to maintain SBIC debentures under the SBIC program in the future, subject to periodic repayments and borrowings, in an amount up to the regulatory maximum amount for affiliated SBIC funds. The weighted-average annual interest rate on the SBIC debentures was 2.9% as of June 30, 2022 and December 31, 2021. The first principal maturity due under the existing SBIC debentures is in 2023, and the weighted-average remaining duration as of June 30, 2022 was 5.6 years. In accordance with SBIC regulations, the Funds are precluded from incurring additional non-SBIC debt without the prior approval of the SBA.

As of June 30, 2022, the SBIC debentures consisted of (i) $175.0 million par value of SBIC debentures outstanding issued by MSMF, with a recorded value of $171.7 million that was net of unamortized debt issuance costs of $3.3 million and (ii) $175.0 million par value of SBIC debentures issued by MSC III with a recorded value of $171.6 million that was net of unamortized debt issuance costs of $3.4 million.

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Credit Facility

Main Street maintains the Credit Facility to provide additional liquidity to support its investment and operational activities. As of June 30, 2022, the Credit Facility included total commitments of $855.0 million from a diversified group of 18 lenders, held a maturity date in April 2026 and contained an accordion feature with the right to request an increase in commitments under the facility from new and existing lenders on the same terms and conditions as the existing commitments up to a total of $1.2 billion.

As of June 30, 2022, borrowings under the Credit Facility bore 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 plus (i) 1.875% (or the applicable Prime Rate 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 Prime 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. As of June 30, 2022, the Credit Facility contained certain affirmative and negative covenants, including but not limited to: (i) maintaining minimum liquidity, (ii) maintaining an interest coverage ratio of at least 2.0 to 1.0, (iii) maintaining a 1940 Act asset coverage ratio of at least 1.5 to 1.0, (iv) maintaining a minimum tangible net worth and (v) maintaining a minimum asset coverage ratio of 200% with respect to the consolidated assets (with certain limitations on the contribution of equity in financing subsidiaries as specified therein) of MSCC and the guarantors under the Credit Facility to the secured debt of MSCC and the guarantors.

As of June 30, 2022, the interest rate on the Credit Facility was 2.9%. The average interest rate for borrowings under the Credit Facility was 2.7% and 2.0% for the three months ended June 30, 2022 and 2021, respectively, and 2.3% and 2.0% for the six months ended June 30, 2022 and 2021, respectively. As of June 30, 2022, Main Street was in compliance with all financial covenants of the Credit Facility.

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”) at an issue price of 99.16%. The 4.50% 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 4.50% 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 4.50% Notes 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 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, resulting from the issue price and after underwriting discounts and estimated offering expenses payable, were $182.2 million. Main Street may from time to time repurchase the 4.50% Notes in accordance with the 1940 Act and the rules promulgated thereunder.

The indenture governing the 4.50% Notes (the “4.50% 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 4.50% 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 4.50% Notes Indenture. As of June 30, 2022, Main Street was in compliance with these covenants.

5.20% Notes due 2024

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 aggregate principal amount of the 5.20% Notes at an issue price of 105.0% and, in July 2020, Main Street issued an additional $125.0 million aggregate principal amount at an issue price of 102.674%. The 5.20%

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Notes issued in December 2019 and July 2020 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 proceeds from the 5.20% Notes, resulting from the issue price and after net issue price premiums and estimated offering expenses payable, were $451.4 million. Main Street may from time to time repurchase the 5.20% Notes in accordance with the 1940 Act and the rules promulgated thereunder.

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 June 30, 2022, Main Street was in compliance with these covenants.

3.00% Notes due 2026

In January 2021, Main Street issued $300.0 million in aggregate principal amount of 3.00% unsecured notes due July 14, 2026 (the “3.00% Notes”) at an issue price of 99.004%. Subsequently, in October 2021, Main Street issued an additional $200.0 million aggregate principal amount of the 3.00% Notes at an issue price of 101.741%. The 3.00% Notes issued in October 2021 have identical terms as, and are a part of a single series with, the 3.00% Notes issued in January 2021. The 3.00% 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 3.00% 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 3.00% Notes may be redeemed in whole or in part at any time at Main Street’s option subject to certain make-whole provisions. The 3.00% Notes bear interest at a rate of 3.00% per year payable semiannually on January 14 and July 14 of each year. The total net proceeds from the 3.00% Notes, resulting from the issue price and after net issue price premiums and estimated offering expenses payable, were $498.3 million. Main Street may from time to time repurchase the 3.00% Notes in accordance with the 1940 Act and the rules promulgated thereunder.

The indenture governing the 3.00% Notes (the “3.00% 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 3.00% 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 3.00% Notes Indenture. As of June 30, 2022, Main Street was in compliance with these covenants.

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NOTE F—FINANCIAL HIGHLIGHTS


	Six Months Ended June 30,
Per Share Data:	2022		2021
NAV at the beginning of the period	$	25.29	$	22.35
Net investment income(1)		1.47		1.20
Net realized gain (loss)(1)(2)		(0.02)		0.03
Net unrealized appreciation (depreciation)(1)(2)		(0.14)		1.15
Income tax benefit (provision)(1)(2)		(0.21)		(0.15)
Net increase in net assets resulting from operations(1)		1.10		2.23
Dividends paid from net investment income		(1.44)		(1.23)
Distributions from capital gains		—		—
Dividends paid		(1.44)		(1.23)
Accretive effect of stock offerings (issuing shares above NAV per share)		0.48		0.07
Accretive effect of DRIP issuance (issuing shares above NAV per share)		0.05		0.04
Other(3)		(0.11)		(0.04)
NAV at the end of the period	$	25.37	$	23.42
Market value at the end of the period	$	38.53	$	41.09
Shares outstanding at the end of the period		73,517,558		68,531,789

(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.

(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.


	Six Months Ended June 30,
	2022			2021

	(dollars in thousands)
NAV at end of period	$	1,865,163		$	1,604,841
Average NAV	$	1,842,554		$	1,553,257
Average outstanding debt	$	1,793,857		$	1,311,114
Ratio of total expenses, including income tax expense, to average NAV (1)(2)		3.97	%		3.76	%
Ratio of operating expenses to average NAV (2)(3)		3.13	%		3.09	%
Ratio of operating expenses, excluding interest expense, to average NAV (2)(3)		1.28	%		1.27	%
Ratio of net investment income to average NAV (2)		5.80	%		5.29	%
Portfolio turnover ratio (2)		10.48	%		11.86	%
Total investment return (2)(4)		(10.96)	%		31.59	%
Total return based on change in NAV (2)(5)		4.47	%		10.06	%

(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 of $6.3 million and $5.0 million for the six months ended June 30, 2022 and 2021, respectively.

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(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 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.

NOTE G—DIVIDENDS, DISTRIBUTIONS AND TAXABLE INCOME

Main Street currently pays regular monthly dividends to its stockholders and periodically pays supplemental dividends to its stockholders. Future dividends, if any, will be determined by its Board of Directors on a quarterly basis. Main Street paid regular monthly dividends of $0.215 per share, totaling $47.1 million, or $0.645 per share, for the three months ended June 30, 2022, and $93.1 million, or $1.29 per share, for the six months ended June 30, 2022 compared to aggregate regular monthly dividends of $42.0 million, or $0.615 per share, for the three months ended June 30, 2021, and $83.9 million, or $1.23 per share, for the six months ended June 30, 2021. Main Street also paid a supplemental dividend of $5.5 million, or $0.075 per share, during the three months ended June 30, 2022, and $10.9 million, or $0.15 per share, during the six months ended June 30, 2022. Main Street did not pay a supplemental dividend during the three or six months ended June 30, 2021.

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 twelve 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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Listed below is a reconciliation of “Net increase in net assets resulting from operations” to taxable income and to total distributions declared to common stockholders for the six months ended June 30, 2022 and 2021.


	Six Months Ended June 30,
	2022		2021

	(estimated, dollars in thousands)
Net increase in net assets resulting from operations	$	79,953	$	152,451
Book-tax difference from share-based compensation expense		(6,906)		(6,967)
Net unrealized (appreciation) depreciation		9,841		(78,440)
Income tax provision (benefit)		15,417		10,407
Pre-tax book (income) loss not consolidated for tax purposes		(9,249)		(17,971)
Book income and tax income differences, including debt origination, structuring fees, dividends, realized gains and changes in estimates		13,568		7,780
Estimated taxable income (1)		102,624		67,260
Taxable income earned in prior year and carried forward for distribution in current year		50,834		24,350
Taxable income earned prior to period end and carried forward for distribution next period		(64,509)		(21,626)
Dividend payable as of period end and paid in the following period		15,673		14,049
Total distributions accrued or paid to common stockholders	$	104,622	$	84,033

(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 income tax expense (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. The income tax expense, or benefit, and the related tax assets and liabilities generated by the Taxable Subsidiaries, if any, are reflected in Main Street’s Consolidated Statement of Operations. Main Street’s provision for income taxes was comprised of the following for the three and six months ended June 30, 2022 and 2021 (amounts in thousands):

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	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Current tax expense (benefit):
Federal	$	64	$	97	$	115	$	141
State		71		359		614		655
Excise		674		200		1,389		493
Total current tax expense (benefit)		809		656		2,118		1,289
Deferred tax expense (benefit):
Federal		7,166		7,101		9,973		7,295
State		2,345		1,969		3,326		1,823
Total deferred tax expense (benefit)		9,511		9,070		13,299		9,118

Total income tax provision (benefit)	$	10,320	$	9,726	$	15,417	$	10,407

The net deferred tax liability at June 30, 2022 and December 31, 2021 was $43.0 million and $29.7 million, respectively, with the change 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 June 30, 2022, 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 2034 through 2037. Any net operating losses generated in 2018 and future periods are not subject to expiration and will carryforward indefinitely until utilized. 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 six months ended June 30, 2022, Main Street sold 2,159,117 shares of its common stock at a weighted-average price of $41.71 per share and raised $90.1 million of gross proceeds under the ATM Program. Net proceeds were $88.9 million after commissions to the selling agents on shares sold and offering costs. As of June 30, 2022, sales transactions representing 61,757 shares had not settled and are not included in shares issued and outstanding on the face of the Consolidated Balance Sheets but are included in the weighted average shares outstanding in the Consolidated Statement of Operations and in the shares used to calculate the net asset value per share. In March 2022, Main Street entered into new distribution agreements to sell up to 15,000,000 shares through the ATM Program. As of June 30, 2022, 13,710,949 shares remained available for sale under the ATM Program.

During the year ended December 31, 2021, Main Street sold 2,332,795 shares of its common stock at a weighted-average price of $42.71 per share and raised $99.6 million of gross proceeds under the ATM Program. Net proceeds were $98.4 million after commissions to the selling agents on shares sold and offering costs. As of December 31, 2021, sales transactions representing 36,136 shares had not settled and are not included in shares issued and outstanding on the face of the Consolidated Balance Sheets but are included in the weighted average shares outstanding in the Consolidated Statement of Operations and in the shares used to calculate the net asset value per share.

NOTE I—DIVIDEND REINVESTMENT PLAN

The dividend reinvestment feature of Main Street’s dividend reinvestment and direct stock purchase plan (the “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 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

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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.

Summarized DRIP information for the six months ended June 30, 2022 and 2021 is as follows:


	Six Months Ended June 30,
	2022		2021

	($ in millions)
DRIP participation	$	9.8	$	7.5
Shares issued for DRIP		246,199		198,283

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 2022 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 June 30, 2022.


Restricted stock authorized under the plan		5,000,000
Less net restricted stock granted during:
Six months ended June 30, 2022		—
Restricted stock available for issuance as of June 30, 2022		5,000,000

As of June 30, 2022, 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 2022 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 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:
Six months ended June 30, 2022		(4,590)
Restricted stock available for issuance as of June 30, 2022		295,410

For the three months ended June 30, 2022 and 2021, Main Street recognized total share-based compensation expense of $3.6 million and $2.8, respectively, related to the restricted stock issued to Main Street employees and non-employee directors. For the six months ended June 30, 2022 and 2021, Main Street recognized total share-based compensation expense of $6.4 million and $5.1, respectively, related to the restricted stock issued to Main Street employees and non-employee directors.

As of June 30, 2022, there was $28.0 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 2.6 years as of June 30, 2022.

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NOTE K—COMMITMENTS AND CONTINGENCIES

At June 30, 2022, Main Street had the following outstanding commitments (in thousands):


Investments with equity capital commitments that have not yet funded:	Amount

Brightwood Capital Fund Investments
Brightwood Capital Fund V, LP	$	3,000
Brightwood Capital Fund III, LP		300
	$	3,300

Freeport Fund Investments
Freeport First Lien Loan Fund III LP	$	4,871
Freeport Financial SBIC Fund LP		2,868
	$	7,739

Harris Preston Fund Investments
HPEP 4, L.P.	$	10,000
HPEP 3, L.P.		1,555
HPEP 423 COR, LP		600
2717 HPP-MS, LP		56
	$	12,211

MS Private Loan Fund I, LP	$	3,750

UnionRock Energy Fund II, LP	$	3,624

Total Equity Commitments (1)(2)	$	30,624

Investments with commitments to fund revolving loans that have not been fully drawn or term loans with additional commitments not yet funded:

Xenon Arc, Inc.	$	32,400
MonitorUS Holding, LLC		14,213
CaseWorthy, Inc.		10,452
MS Private Loan Fund I, LP		10,000
NWN Corporation		8,760
JTI Electrical & Mechanical, LLC		8,421
Paragon Healthcare, Inc.		7,571
NinjaTrader, LLC		7,472
Adams Publishing Group, LLC		7,094
Veregy Consolidated, Inc.		5,875
Watterson Brands, LLC		5,789
SI East, LLC		5,250
Bolder Panther Group, LLC		5,000
Pearl Meyer Topco LLC		5,000
Robbins Bros. Jewelry, Inc.		4,500
South Coast Terminals Holdings, LLC		4,465
Winter Services LLC		4,444
ArborWorks, LLC		4,210
Bettercloud, Inc.		4,189
VVS Holdco, LLC		3,200
Cody Pools, Inc.		2,950
Microbe Formulas, LLC		2,881
Batjer TopCo, LLC		2,700
Infolinks Media Buyco, LLC		2,520
Nebraska Vet AcquireCo, LLC		2,500

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	Amount

Classic H&G Holdco, LLC	$	2,440
West Star Aviation Acquisition, LLC		2,411
Centre Technologies Holdings, LLC		2,400
IG Parent Corporation		2,313
AVEX Aviation Holdings, LLC		2,160
Direct Marketing Solutions, Inc.		2,125
PPL RVs, Inc.		2,000
The Affiliati Network, LLC		2,000
Roof Opco, LLC		1,960
Evergreen North America Acquisitions, LLC		1,854
ATS Operating, LLC		1,800
Career Team Acquireco LLC		1,800
Johnson Downie Opco, LLC		1,800
Engineering Research & Consulting, LLC		1,769
Chamberlin Holding LLC		1,600
Trantech Radiator Topco, LLC		1,600
Mako Steel, LP		1,501
Hawk Ridge Systems, LLC		1,415
Burning Glass Intermediate Holding Company, Inc.		1,394
GS HVAM Intermediate, LLC		1,364
GRT Rubber Technologies LLC		1,340
American Health Staffing Group, Inc.		1,333
RA Outdoors LLC		1,278
Project Eagle Holdings, LLC		1,250
Acumera, Inc.		1,238
Gamber-Johnson Holdings, LLC		1,200
NuStep, LLC		1,200
KMS, LLC		1,086
BDS Solutions IntermediateCo, LLC		1,032
CompareNetworks Topco, LLC		1,000
Interface Security Systems, L.L.C		898
Mystic Logistics Holdings, LLC		800
Invincible Boat Company, LLC.		768
Project BarFly, LLC		760
DTE Enterprises, LLC		750
Student Resource Center, LLC		750
Flip Electronics LLC		736
MB2 Dental Solutions, LLC		656
Orttech Holdings, LLC		625
Market Force Information, LLC		600
ASC Interests, LLC		530
Jensen Jewelers of Idaho, LLC		500
Datacom, LLC		450
Flame King Holdings, LLC		400
Wall Street Prep, Inc.		400
Zips Car Wash, LLC		383
SIB Holdings, LLC		354
Dynamic Communities, LLC		250
Acousti Engineering Company of Florida		53

Total Loan Commitments	$	232,182

Total Commitments	$	263,602

(1)

This table excludes commitments related to six additional Other Portfolio investments for which the investment period has expired and remaining commitments may only be drawn to pay fund expenses. The Company does not expect any material future capital to be called on its commitment to these investments and as a result has excluded those commitments from this table.

(2)

This table excludes commitments related to three additional Other Portfolio investments for which the investment period has expired and remaining commitments may only be drawn to pay fund expenses or for follow on investments in existing portfolio companies. The Company does not expect any material future capital to be called on its commitment to these investments to pay fund expenses, and based on representations from the fund manager,

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the Company does not expect any further capital will be called on its commitment for follow on investments. As a result, the Company has excluded those commitments from this table.

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.

Main Street has one operating lease for its office space. The lease commenced May 15, 2017 and expires March 31, 2034. It contains two five-year extension options for a final expiration date of March 31, 2044.

In accordance with ASC 842, Main Street has recorded this lease as a right-of-use asset and a lease liability and records lease expense on a straight-line basis.

Total operating lease cost incurred by Main Street for each of the three months ended June 30, 2022 and 2021 was $0.2 million and for each of the six months ended June 30, 2022 and 2021 was $0.4 million. As of June 30, 2022, the asset related to the operating lease was $3.5 million and is included in the interest receivable and other assets balance on the Consolidated Balance Sheets. The lease liability was $4.1 million and is included in the accounts payable and other liabilities balance on the Consolidated Balance Sheets. As of June 30, 2022, the remaining lease term was 5.6 years and the discount rate was 4.2%.

The following table shows future minimum payments under Main Street’s operating lease as of June 30, 2022 (in thousands):


For the Years Ended December 31,	Amount
2022	$	395
2023		804
2024		818
2025		832
2026		846
Thereafter		933
Total	$	4,628

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.

NOTE L—RELATED PARTY TRANSACTIONS

As discussed further in Note D—External Investment Manager, 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 June 30, 2022, Main Street had a receivable of $6.3 million due from the External Investment Manager, which included (i) $4.5 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—External Investment Manager) and (ii) $1.7 million of dividends declared but not paid by the External Investment Manager. MSCC has entered into an agreement with the External Investment Manager to share employees in connection with its asset management business generally, and specifically for the External Investment Manager’s relationship with MSC Income and its other clients (see further discussion in Note A.1—Organization and Basis of Presentation—Organization and Note D—External Investment Manager).

From time to time, Main Street may make investments in clients of the External Investment Manager in the form of debt or equity capital on terms approved by Main Street’s Board of Directors. In January 2021, Main Street

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entered into a Term Loan Agreement with MSC Income (the “Term Loan Agreement”). The Term Loan Agreement was unanimously approved by Main Street’s Board of Directors, including each director who is not an “interested person,” as such term is defined in Section 2(a)(19) of the 1940 Act, and the board of directors of MSC Income, including each director who is not an “interested person” of MSC Income or the External Investment Manager. The Term Loan Agreement initially provided for a term loan of $40.0 million to MSC Income, bearing interest at a fixed rate of 5.00% per annum, and maturing in January 2026. The Term Loan Agreement was amended in July 2021 to provide for borrowings up to an additional $35.0 million, $20.0 million of which was funded upon signing of the amendment and $15.0 million available in two additional advances during the six months following the amendment date. Borrowings under the Term Loan Agreement were expressly subordinated and junior in right of payment to all secured indebtedness of MSC Income. In October 2021, MSC Income fully repaid all borrowings outstanding under the Term Loan Agreement and the Term Loan Agreement was extinguished.

In May 2022, Main Street purchased 94,697 shares of common stock of MSC Income from MSC Income at the price shares were purchased by MSC Income stockholders pursuant to MSC Income’s dividend reinvestment plan for its May dividend on such date. Main Street’s purchase of MSC Income common stock was unanimously approved by the Board of Directors and MSC Income’s board of directors, including each director who is not an “interested person,” as such term is defined in Section 2(a)(19) of the 1940 Act, of each board. As of June 30, 2022, Main Street owned 94,697 shares of MSC Income. In addition, certain of Main Street’s officers and employees own shares of MSC Income and therefore have direct pecuniary interests in MSC Income.

In December 2020, the External Investment Manager entered into an Investment Management Agreement with the Private Loan Fund to provide investment advisory and management services in exchange for an asset-based fee and certain incentive fees. The Private Loan Fund is a private investment fund exempt from registration under the 1940 Act that co-invests with Main Street in Main Street’s Private Loan investment strategy. In connection with the Private Loan Fund’s initial closing in December 2020, Main Street committed to contribute up to $10.0 million as a limited partner and will be entitled to distributions on such interest. In February 2022, Main Street increased its total commitment to the Private Loan Fund from $10.0 million to $15.0 million. In addition, certain of Main Street’s officers and employees (and certain of their immediate family members) have made capital commitments to the Private Loan Fund as limited partners and therefore have direct pecuniary interests in the Private Loan Fund. As of June 30, 2022, Main Street has funded $11.3 million of its limited partner commitment and Main Street’s unfunded commitment was $3.7 million. Main Street’s limited partner commitment to the Private Loan Fund was unanimously approved by the Board of Directors, including each director who is not an “interested person,” as such term is defined in Section 2(a)(19) of the 1940 Act.

Additionally, Main Street provided the Private Loan Fund with a revolving line of credit pursuant to an Unsecured Revolving Promissory Note, dated February 5, 2021 and was subsequently amended on November 30, 2021 and on December 29, 2021 (as amended, the “PL Fund 2021 Note”), in an aggregate amount equal to the amount of limited partner capital commitments to the Private Loan Fund up to $85.0 million. Borrowings under the PL Fund 2021 Note bore interest at a fixed rate of 5.00% per annum and matured on February 28, 2022. The PL Fund 2021 Note was unanimously approved by Main Street’s Board of Directors, including each director who is not an “interested person,” as such term is defined in Section 2(a)(19) of the 1940 Act. In February 2022, the Private Loan Fund fully repaid all borrowings outstanding under the PL Fund 2021 Note and the PL Fund 2021 Note was extinguished.

In March 2022, Main Street provided the Private Loan Fund with a new revolving line of credit pursuant to a Secured Revolving Promissory Note, dated March 17, 2022 (the “PL Fund 2022 Note”), which provides for borrowings up to $10.0 million. Borrowings under the PL Fund 2022 Note bear interest at a fixed rate of 5.00% per annum and mature on the date upon which the Private Loan Fund’s investment period concludes, which is scheduled to occur in March 2026. Available borrowings under the PL Fund 2022 Note are subject to a 0.25% non-use fee. The PL Fund 2022 Note was unanimously approved by Main Street’s Board of Directors, including each director who is not an “interested person,” as such term is defined in Section 2(a)(19) of the 1940 Act. As of June 30, 2022, there were no borrowings outstanding under the PL Fund 2022 Note.

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

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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 June 30, 2022, $14.9 million of compensation, plus net unrealized gains and losses and investment income, and minus distributions had been deferred under the 2015 Deferred Compensation Plan (including amounts previously deferred under the 2013 Deferred Compensation Plan). Of this amount, $6.1 million had been deferred into phantom Main Street stock units, representing 158,865 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 the deferred fees represented by such phantom stock units are earned over the service period. The dividend amounts related to additional phantom stock units are included in the Consolidated 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

In August 2022, Main Street declared a supplemental cash dividend of $0.10 per share payable in September 2022. This supplemental cash dividend is in addition to the previously announced regular monthly cash dividends that Main Street declared for the third quarter of 2022 of $0.215 per share for each of July, August and September 2022.

In August 2022, Main Street declared regular monthly dividends of $0.22 per share for each month of October, November and December of 2022. These regular monthly dividends equal a total of $0.66 per share for the fourth quarter of 2022, representing a 4.8% increase from the regular monthly dividends paid in the fourth quarter of 2021. Including the regular monthly and supplemental dividends declared for the third and fourth quarters of 2022, Main Street will have paid $35.02 per share in cumulative dividends since its October 2007 initial public offering.

During August 2022, Main Street amended its Credit Facility to, among other changes, (i) increase the revolving commitments by lenders to $920.0 million, and with the right to request an increase in commitments under the Credit Facility from new and existing lenders on the same terms and conditions as the existing commitments up to a total of $1.4 billion, subject to certain conditions, (ii) extend the revolving period under the Credit Facility to August 4, 2026 and the final maturity date of the Credit Facility to August 4, 2027, (iii) transition the reference rate used to determine the borrowing interest rate from LIBOR to SOFR plus an applicable credit spread adjustment, while maintaining the interest rate spread of 1.875%.

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Schedule 12-14

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments In and Advances to Affiliates

June 30, 2022

(dollars in thousands)

(unaudited)


							Amount of
							Interest,
							Fees or
			Amount of		Amount of		Dividends		December 31,						June 30,
			Realized		Unrealized		Credited to		2021		Gross		Gross		2022
Company	Investment(1)(10)(11)	Geography	Gain/(Loss)		Gain/(Loss)		Income(2)		Fair Value		Additions(3)		Reductions(4)		Fair Value
Majority‑owned investments
ASK (Analytical Systems Keco Holdings, LLC)	12.00% (L+10.00%, Floor 2.00%) Secured Debt	(8)	$	-	$	-	$	339	$	4,736	$	45	$	140	$	4,641
	Preferred Member Units	(8)		-		(576)		-		4,894		-		576		4,318
Brewer Crane Holdings, LLC	11.06% (L+10.00%, Floor 1.00%) Secured Debt	(9)		-		-		448		8,037		12		248		7,801
	Preferred Member Units	(9)		-		(660)		530		7,710		-		660		7,050
Café Brazil, LLC	Member Units	(8)		-		(50)		99		2,570		-		50		2,520
California Splendor Holdings LLC	11.00% (L+10.00%, Floor 1.00%) Secured Debt	(9)		-		56		1,578		27,915		85		-		28,000
	15.00% PIK Preferred Member Units	(9)		-		-		652		9,510		652		6,449		3,713
	Preferred Member Units	(9)		-		6,020		125		13,275		6,020		-		19,295
Clad-Rex Steel, LLC	10.63% (L+9.50%, Floor 1.00%) Secured Debt	(5)		-		-		574		10,401		20		-		10,421
	10.00% Secured Debt	(5)		-		-		54		1,071		-		16		1,055
	Member Units	(5)				80		-		530		80				610
	Member Units	(5)		-		-		764		10,250		-		-		10,250
CMS Minerals Investments	Member Units	(9)		-		447		69		1,974		447		147		2,274
Cody Pools, Inc.	12.25% (L+10.50%, Floor 1.75%) Secured Debt	(8)		-		(45)		2,702		42,484		2,910		3,757		41,637
	Preferred Member Units	(8)		-		3,550		1,749		47,640		3,550		-		51,190
CompareNetworks Topco, LLC	10.13% (L+9.00%, Floor 1.00%) Secured Debt	(9)		-		(10)		308		6,477		10		746		5,741
	Preferred Member Units	(9)		-		5,230		316		12,000		5,230		-		17,230
Datacom, LLC	7.50% Secured Debt	(8)		-		-		416		7,668		84		135		7,617
	Preferred Member Units	(8)		-		60		48		2,610		60		-		2,670
Direct Marketing Solutions, Inc.	12.13% (L+11.00%, Floor 1.00%) Secured Debt	(9)		-		(20)		1,551		24,048		1,317		687		24,678
	Preferred Stock	(9)		-		3,200		686		18,350		3,200		-		21,550
Gamber-Johnson Holdings, LLC	10.00% (L+8.00%, Floor 2.00%) Secured Debt	(5)		-		(11)		1,100		21,598		11		11		21,598
	Member Units	(5)		-		(3,400)		360		49,700		-		3,400		46,300
GRT Rubber Technologies LLC	9.06% (L+8.00%) Secured Debt	(8)		-		(22)		1,676		38,885		22		22		38,885
	Member Units	(8)		-		-		2,441		46,190		-		-		46,190
Jensen Jewelers of Idaho, LLC	10.75% (Prime+6.75%, Floor 2.00%) Secured Debt	(9)		-		(4)		130		2,550		4		104		2,450
	Member Units	(9)		-		2,700		1,376		12,420		2,700		-		15,120
Kickhaefer Manufacturing Company, LLC	11.50% Secured Debt	(5)		-		-		1,205		20,324		25		-		20,349
	9.00% Secured Debt	(5)		-		-		177		3,876		1		17		3,860
	Member Units	(5)		-		(70)		-		12,310		-		70		12,240
	Member Units	(5)		-		-		55		2,460		-		-		2,460
Market Force Information, LLC	12.13% (L+11.00%, Floor 1.00%) Secured Debt	(9)		-		-		217		3,400		1,000		-		4,400
	12.00% PIK Secured Debt	(9)		-		(1,405)		-		8,936		-		1,405		7,531
MH Corbin Holding LLC	13.00% Secured Debt	(5)		-		(1,495)		540		5,934		9		1,655		4,288
MSC Adviser I, LLC	Member Units	(8)		-		(22,080)		3,983		140,400		-		22,080		118,320
Mystic Logistics Holdings, LLC	10.00% Secured Debt	(6)		-		(1)		312		6,378		1		281		6,098
	Common Stock	(6)		-		7,370		1,596		8,840		7,370		-		16,210
OMi Topco, LLC	12.00% Secured Debt	(8)		-		(29)		1,099		18,000		29		1,279		16,750
	Preferred Member Units	(8)		-		90		1,197		20,210		90		-		20,300
PPL RVs, Inc.	7.97% (L+7.00%, Floor 0.50%) Secured Debt	(8)		-		251		683		12,381		9,264		2,000		19,645
	Common Stock	(8)		-		4,130		462		14,360		4,130		-		18,490
Principle Environmental, LLC	13.00% Secured Debt	(8)		-		-		86		1,465		6		1,000		471
	13.00% Secured Debt	(8)				-		399		5,808		12				5,820
	Preferred Member Units	(8)		-		370		437		11,160		370		-		11,530
	Common Stock	(8)		-		30		-		710		30		-		740
Quality Lease Service, LLC	Member Units	(7)		-		76		-		2,149		76		1,150		1,075
Robbins Bros. Jewelry, Inc.	12.00% (L+11.00%, Floor 1.00%) Secured Debt	(9)		-		-		2,241		35,956		43		225		35,774
	Preferred Equity	(9)		-		4,670		279		11,070		4,670		-		15,740

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							Amount of
							Interest,
							Fees or
			Amount of		Amount of		Dividends		December 31,						June 30,
			Realized		Unrealized		Credited to		2021		Gross		Gross		2022
Company	Investment(1)(10)(11)	Geography	Gain/(Loss)		Gain/(Loss)		Income(2)		Fair Value		Additions(3)		Reductions(4)		Fair Value
Trantech Radiator Topco, LLC	12.00% Secured Debt	(7)		-		(12)		528		8,712		14		412		8,314
	Common Stock	(7)		-		(570)		58		8,660		-		570		8,090
Ziegler’s NYPD, LLC	12.00% Secured Debt	(8)		-		-		38		625		-		-		625
	6.50% Secured Debt	(8)		-		-		33		1,000		-		-		1,000
	14.00% Secured Debt	(8)		-		-		194		2,750		-		-		2,750
	Preferred Member Units	(8)		-		(450)		-		2,130		-		450		1,680
Other controlled investments
2717 MH, L.P.	LP Interests (2717 MH, L.P.)	(8)		-		1,408		-		3,971		2,583		-		6,554
	LP Interests (2717 HPP-MS, L.P.)	(8)		-		-		-		-		244		-		244
ASC Interests, LLC	13.00% Secured Debt	(8)		-		-		13		200		-		30		170
	13.00% Secured Debt	(8)		-		-		120		1,636		12		-		1,648
	Member Units	(8)		-		80		-		720		80		-		800
ATS Workholding, LLC	5.00% Secured Debt	(9)		-		-		-		3,005		-		66		2,939
Barfly Ventures, LLC	7.00% Secured Debt	(5)		-		-		25		711		-		-		711
	Member Units	(5)		-		470		-		1,930		470		-		2,400
Batjer TopCo, LLC	11.00% Secured Debt	(8)		-		-		512		-		11,372		459		10,913
	Member Units	(8)		-		-		-		-		4,073		-		4,073
Bolder Panther Group, LLC	10.50% (L+9.00%, Floor 1.50%) Secured Debt	(9)		-		(39)		2,491		39,000		10,233		39		49,194
	Class B Preferred Member Units	(9)		-		2,760		276		23,170		2,760		-		25,930
Bridge Capital Solutions Corporation	13.00% Secured Debt	(6)		-		-		576		8,813		-		-		8,813
	13.00% Secured Debt	(6)		-		-		65		1,000		-		-		1,000
	Preferred Member Units	(6)		-		-		50		1,000		-		-		1,000
	Warrants	(6)		-		200		-		4,060		200		-		4,260
CBT Nuggets, LLC	Member Units	(9)		-		(2,720)		1,647		50,620		-		2,720		47,900
Centre Technologies Holdings, LLC	12.00% (L+10.00%, Floor 2.00%) Secured Debt	(8)		-		507		838		8,864		7,903		1,826		14,941
	Preferred Member Units	(8)		-		768		60		5,840		1,050		-		6,890
Chamberlin Holding LLC	9.13% (L+8.00%, Floor 1.00%) Secured Debt	(8)		-		(35)		845		17,817		35		386		17,466
	Member Units	(8)				(1,630)		348		24,140		-		1,630		22,510
	Member Units	(8)		-		-		34		1,540		-		-		1,540
Charps, LLC	10.00% Unsecured Debt	(5)		-		(27)		309		5,694		27		27		5,694
	Preferred Member Units	(5)		-		(540)		417		13,990		-		540		13,450
Colonial Electric Company LLC	12.00% Secured Debt	(6)		-		-		1,703		24,351		1,630		630		25,351
	Preferred Member Units	(6)		-		(190)		805		9,130		-		190		8,940
Copper Trail Energy Fund I, LP - CTMH	LP Interests (CTMH, LP)	(9)		-		-		-		710		-		-		710
Digital Products Holdings LLC	11.13% (L+10.00%, Floor 1.00%) Secured Debt	(5)		-		-		929		16,801		23		661		16,163
	Preferred Member Units	(5)		-		-		100		9,835		-		-		9,835
Flame King Holdings, LLC	7.50% (L+6.50%, Floor 1.00%) Secured Debt	(9)		-		68		288		6,324		1,276		-		7,600
	12.00% (L+11.00%, Floor 1.00%) Secured Debt	(9)		-		183		1,300		20,996		204		-		21,200
	Preferred Equity	(9)		-		3,010		559		10,400		3,010		-		13,410
Garreco, LLC	9.00% (L+8.00%, Floor 1.00%, Ceiling 1.50%) Secured Debt	(8)		-		-		190		4,196		-		-		4,196
	Member Units	(8)		-		220		321		2,270		220		-		2,490
Gulf Manufacturing, LLC	Member Units	(8)		-		(130)		985		5,640		-		130		5,510
Gulf Publishing Holdings, LLC	10.60% (5.25% Cash, 5.25% PIK) (L+9.50%, Floor 1.00%) Secured Debt	(8)		-		-		7		257		-		-		257
	12.50% (6.25% Cash, 6.25% PIK) Secured Debt	(8)		-		(2,188)		426		9,717		-		2,188		7,529
Harrison Hydra-Gen, Ltd.	Common Stock	(8)		-		(200)		-		3,530		-		200		3,330
Johnson Downie Opco, LLC	13.00% (L+11.50%, Floor 1.50%) Secured Debt	(8)		-		92		755		11,344		115		1,038		10,421
	Preferred Equity	(8)		-		2,730		566		3,150		2,730		-		5,880
JorVet Holdings, LLC	12.00% Secured Debt	(9)		-		-		1,082		-		25,406		-		25,406
	Common Stock	(9)		-		-		54		-		10,741		-		10,741
KBK Industries, LLC	Member Units	(5)		-		310		685		13,620		310		-		13,930
MS Private Loan Fund	LP Interests	(8)		-		(544)		191		2,581		8,750		544		10,787
MSC Income Fund, Inc.	Common Equity	(8)		-		-		-		-		750		-		750
NAPCO Precast, LLC	Member Units	(8)		-		(1,730)		4		13,560		-		1,730		11,830
Nebraska Vet AcquireCo, LLC (NVS)	12.00% Secured Debt	(5)		-		-		649		10,412		11		-		10,423
	12.00% Secured Debt	(5)				-		548		4,829		6,544		-		11,373
	Preferred Member Units	(5)		-		-		-		7,700		-		-		7,700
NexRev LLC	11.00% Secured Debt	(8)		-		(1,703)		1,222		14,045		-		5,783		8,262
	Preferred Member Units	(8)		-		(3,080)		40		2,690		-		1,750		940
NRP Jones, LLC	12.00% Secured Debt	(5)		-		-		126		2,080		-		-		2,080
	Member Units	(5)		-		(970)		198		6,440		-		970		5,470
NuStep, LLC	7.63% (L+6.50%, Floor 1.00%) Secured Debt	(5)		-		-		110		1,720		1,480		-		3,200
	12.00% Secured Debt	(5)		-		28		1,043		17,240		1,200		-		18,440
	Preferred Member Units	(5)		-		(1,940)		-		13,500		-		1,940		11,560

Table of Contents


							Amount of
							Interest,
							Fees or
			Amount of		Amount of		Dividends		December 31,						June 30,
			Realized		Unrealized		Credited to		2021		Gross		Gross		2022
Company	Investment(1)(10)(11)	Geography	Gain/(Loss)		Gain/(Loss)		Income(2)		Fair Value		Additions(3)		Reductions(4)		Fair Value
Orttech Holdings, LLC	12.00% (L+11.00%, Floor 1.00%) Secured Debt	(5)		-		-		1,494		24,150		29		400		23,779
	Preferred Stock	(5)		-		-		386		10,000		-		-		10,000
Pearl Meyer Topco LLC	12.00% Secured Debt	(6)		-		(61)		1,942		32,674		1,561		5,554		28,681
	Member Units	(6)		-		12,780		2,856		26,970		12,780		-		39,750
River Aggregates, LLC	Member Units	(8)		-		100		-		3,280		100		-		3,380
Tedder Industries, LLC	12.00% Secured Debt	(9)		-		-		961		15,141		44		-		15,185
	12.00% Secured Debt	(9)				-		102		1,040		800		-		1,840
	Preferred Member Units	(9)		-		(1,487)		-		8,579		222		1,487		7,314
Televerde, LLC	Member Units	(8)		-		(2,135)		-		7,280		-		2,135		5,145
	Preferred Stock	(8)		-		1,076		-		-		1,794		-		1,794
Vision Interests, Inc.	Series A Preferred Stock	(9)		-		-		144		3,000		-		-		3,000
VVS Holdco LLC	11.50% Secured Debt	(5)		-		-		1,821		31,269		34		1,201		30,102
	Preferred Equity	(5)		-		240		200		11,840		240		-		12,080


Other
Amounts related to investments transferred to or from other 1940 Act classification during the period				-		-		57		41,748		-		-		-
Total Control investments			$	-	$	13,101	$	69,385	$	1,489,257	$	176,645	$	85,996	$	1,538,158
Affiliate Investments
AAC Holdings, Inc.	18.00% (10.00% Cash, 8.00% PIK) Secured Debt	(7)	$	-	$	(150)	$	970	$	9,794	$	296	$	-	$	10,090
	Common Stock	(7)		-		(1,279)		-		2,079		-		1,279		800
	Warrants	(7)		-		(1,200)		-		1,940		-		1,200		740
AFG Capital Group, LLC	10.00% Secured Debt	(8)		-		-		2		144		-		144		-
	Preferred Member Units	(8)		-		1,040		-		7,740		1,040		-		8,780
ATX Networks Corp.	8.92% (L+7.50%, Floor 1.00%) Secured Debt	(6)		-		(309)		388		7,092		228		1,133		6,187
	10.00% PIK Unsecured Debt	(6)		-		120		159		1,963		437		158		2,242
BBB Tank Services, LLC	12.06% (L+11.00%, Floor 1.00%) Unsecured Debt	(8)		-		(209)		290		2,507		-		209		2,298
	Preferred Stock (non-voting)	(8)		-		-		-		-		-		-		-
	Member Units	(8)		-		-		-		-		-		-		-
Boccella Precast Products LLC	10.00% Secured Debt	(6)		-		-		16		320		-		-		320
	Member Units	(6)		-		(320)		70		4,830		-		320		4,510
Buca C, LLC	10.37% (L+9.25%, Floor 1.00%) Secured Debt	(7)		-		-		1,036		14,370		-		1,221		13,149
Career Team Holdings, LLC	12.50% Secured Debt	(6)		-		-		1,296		20,050		20		-		20,070
	Class A Common Units	(6)		-		-		-		4,499		1		-		4,500
Chandler Signs Holdings, LLC	Class A Units	(8)		-		160		-		460		160		-		620
Classic H&G Holdings, LLC	7.00% (L+6.00%, Floor 1.00%) Secured Debt	(6)		-		-		349		4,000		7,920		6,360		5,560
	8.00% Secured Debt	(6)		-		(21)		797		19,274		21		21		19,274
	Preferred Member Units	(6)		-		8,530		947		15,260		8,530		-		23,790
Congruent Credit Opportunities Funds	LP Interests (Congruent Credit Opportunities Fund III, LP)	(8)		-		(63)		300		9,959		-		1,660		8,299
DMA Industries, LLC	12.00% Secured Debt	(7)		-		186		1,300		20,993		207		-		21,200
	Preferred Equity	(7)		-		976		-		5,944		976		-		6,920
Dos Rios Partners	LP Interests (Dos Rios Partners - A, LP)	(8)		-		(546)		-		3,280		-		546		2,734
	LP Interests (Dos Rios Partners, LP)	(8)		-		(1,719)		-		10,329		-		1,719		8,610
Dos Rios Stone Products LLC	Class A Preferred Units	(8)		-		(290)		-		640		-		290		350
EIG Fund Investments	LP Interests (EIG Global Private Debt Fund-A, L.P.)	(8)		11		-		28		547		-		158		389
Freeport Financial SBIC Fund LP	LP Interests (Freeport Financial SBIC Fund LP)	(5)		-		(52)		2		6,078		-		1,962		4,116
	LP Interests (Freeport First Lien Loan Fund III LP)	(5)		-		(57)		242		7,231		-		436		6,795
GFG Group, LLC.	9.00% Secured Debt	(5)		-		(13)		675		12,545		13		13		12,545
	Preferred Member Units	(5)		-		-		378		6,990		-		-		6,990
Hawk Ridge Systems, LLC	7.13% (L+6.00%, Floor 1.00%) Secured Debt	(9)		-		-		94		2,585		-		-		2,585
	8.00% Secured Debt	(9)		-		(16)		1,416		34,800		16		16		34,800
	Preferred Member Units	(9)		-		5,350		704		14,680		5,350				20,030
	Preferred Member Units	(9)		-		280		-		771		279		-		1,050
Houston Plating and Coatings, LLC	8.00% Unsecured Convertible Debt	(8)		-		(210)		121		2,960		-		210		2,750
	Member Units	(8)		-		(690)		16		3,210		-		690		2,520
HPEP 3, L.P.	LP Interests (HPEP 3, L.P.)	(8)		779		(21)		(80)		4,712		-		381		4,331
	LP Interests (423 COR, LP)	(8)		-		-		-		-		1,400		-		1,400

Table of Contents


							Amount of
							Interest,
							Fees or
			Amount of		Amount of		Dividends		December 31,						June 30,
			Realized		Unrealized		Credited to		2021		Gross		Gross		2022
Company	Investment(1)(10)(11)	Geography	Gain/(Loss)		Gain/(Loss)		Income(2)		Fair Value		Additions(3)		Reductions(4)		Fair Value
I-45 SLF LLC	Member Units (Fully diluted 20.0%; 21.75% profits interest)	(8)		-		(1,438)		943		14,387		-		1,438		12,949
Iron-Main Investments, LLC	12.50% Secured Debt	(5)		-		-		204		3,170		3		-		3,173
	12.50% Secured Debt	(5)		-		-		294		4,557		4		-		4,561
	12.50% Secured Debt	(5)		-		-		1,839		28,749		20		-		28,769
	Common Stock	(5)		-		-		-		1,798		-		-		1,798
L.F. Manufacturing Holdings, LLC	Preferred Member Units (non-voting)	(8)		-		-		8		107		8		-		115
	Member Units	(8)		-		590		224		2,560		590		-		3,150
OnAsset Intelligence, Inc.	12.00% PIK Secured Debt	(8)		-		(155)		28		935		28		155		808
	12.00% PIK Secured Debt	(8)		-		(158)		29		954		29		158		825
	12.00% PIK Secured Debt	(8)		-		(341)		62		2,055		62		341		1,776
	12.00% PIK Secured Debt	(8)		-		(710)		129		4,286		129		711		3,704
	10.00% PIK Unsecured Debt	(8)		-		-		5		191		11		5		197
Oneliance, LLC	12.06% (L+11.00%, Floor 1.00%) Secured Debt	(7)		-		-		344		5,547		6		-		5,553
	Preferred Stock	(7)		-		-		-		1,056		-		-		1,056
Rocaceia, LLC (Quality Lease and Rental Holdings, LLC)	12.00% Secured Debt	(8)		(51)		-		-		-		-		-		-
SI East, LLC (Stavig)	10.25% Secured Debt	(7)		-		(36)		3,751		65,850		36		1,525		64,361
	Preferred Member Units	(7)		-		1,260		345		11,570		1,260		-		12,830
Slick Innovations, LLC	13.00% Secured Debt	(6)		-		(28)		340		5,320		28		708		4,640
	Common Stock	(6)		-		130		-		1,510		130		-		1,640
	Warrants	(6)		-		40		-		400		40		-		440
Sonic Systems International, LLC	8.50% (L+7.50%, Floor 1.00%) Secured Debt	(8)		-		(233)		565		11,757		3,737		234		15,260
	Common Stock	(8)		-		64		21		1,070		350		-		1,420
Superior Rigging & Erecting Co.	12.00% Secured Debt	(7)		-		-		1,320		21,332		23		-		21,355
	Preferred Member Units	(7)		-		-		-		4,500		-		-		4,500
The Affiliati Network, LLC	11.83% Secured Debt	(9)		-		-		794		13,096		2,187		3,640		11,643
	Preferred Stock	(9)		-		-		302		6,400		-		-		6,400
UnionRock Energy Fund II, LP	LP Interests	(9)		-		(997)		55		6,123		1,324		3,582		3,865
UniTek Global Services, Inc.	9.07% (7.07% cash, 2.00% PIK) (2.00% PIK, L+5.50% Floor 1.00%) Secured Debt	(6)		-		(9)		18		371		8		13		366
	9.07% (7.07% cash, 2.00% PIK) (2.00% PIK, L+5.50% Floor 1.00%) Secured Debt	(6)		-		(47)		88		1,852		42		66		1,828
	15.00% PIK Secured Convertible Debt	(6)		-		72		95		2,375		309		96		2,588
	Preferred Stock	(6)		-		(181)		181		2,833		181		181		2,833
	Preferred Stock	(6)		-		393		-		1,498		393		-		1,891
Volusion, LLC	11.50% Secured Debt	(8)		-		-		992		17,434		-		350		17,084
	8.00% Unsecured Convertible Debt	(8)		-		-		16		409		-		-		409
	Preferred Member Units	(8)		-		(3,060)		-		5,989		-		3,059		2,930
Other				-
Amounts related to investments transferred to or from other 1940 Act classification during the period				-		139		1,302		32,597		-		-		-
Total Affiliate investments			$	739	$	4,772	$	25,810	$	549,214	$	37,832	$	36,388	$	518,061

(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 included in Item 1. Consolidated Financial Statements of this Quarterly Report on Form 10-Q.

(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 related to investments transferred from other 1940 Act classifications during the period.”

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(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 June 30, 2022 for control investments located in this region was $341,821. This represented 22.2% of net assets as of June 30, 2022. The fair value as of June 30, 2022 for affiliate investments located in this region was $68,747. This represented 13.3% of net assets as of June 30, 2022.

(6)

Portfolio company located in the Northeast region and Canada as determined by location of the corporate headquarters. The fair value as of June 30, 2022 for control investments located in this region was $140,103. This represented 9.1% of net assets as of June 30, 2022. The fair value as of June 30, 2022 for affiliate investments located in this region was $102,679. This represented 19.8% of net assets as of June 30, 2022.

(7)

Portfolio company located in the Southeast region as determined by location of the corporate headquarters. The fair value as of June 30, 2022 for control investments located in this region was $17,479. This represented 1.1% of net assets as of June 30, 2022. The fair value as of June 30, 2022 for affiliate investments located in this region was $162,554. This represented 31.4% of net assets as of June 30, 2022.

(8)

Portfolio company located in the Southwest region as determined by location of the corporate headquarters. The fair value as of June 30, 2022 for control investments located in this region was $588,039. This represented 38.2% of net assets as of June 30, 2022. The fair value as of June 30, 2022 for affiliate investments located in this region was $103,708. This represented 20.0% of net assets as of June 30, 2022.

(9)

Portfolio company located in the West region as determined by location of the corporate headquarters. The fair value as of June 30, 2022 for control investments located in this region was $450,716. This represented 29.3% of net assets as of June 30, 2022. The fair value as of June 30, 2022 for affiliate investments located in this region was $80,373. This represented 15.5% of net assets as of June 30, 2022.

(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 included in Item 1. Consolidated Financial Statements of this Quarterly Report on Form 10-Q. Supplemental information can be located within the Consolidated 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 June 30, 2022 (see Note K). The fair value of the investment includes the impact of the fair value of any unfunded commitments.

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Schedule 12-14

MAIN STREET CAPITAL CORPORATION

Consolidated Schedule of Investments in and Advances to Affiliates

June 30, 2021

(dollars in thousands)

(unaudited)


							Amount of
							Interest,
							Fees or
			Amount of		Amount of		Dividends		December 31,						June 30,
			Realized		Unrealized		Credited to		2020		Gross		Gross		2021
Company	Investment(1)(10)(11)	Geography	Gain/(Loss)		Gain/(Loss)		Income(2)		Fair Value		Additions(3)		Reductions(4)		Fair Value
Majority‑owned investments
ASK (Analytical Systems Keco Holdings, LLC)	12.00% (L+10.00%, Floor 2.00%) Secured Debt	(8)	$	-	$	-	$	346	$	4,874	$	114	$	150	$	4,838
	Preferred Member Units	(8)		-		(1,830)		-		3,200		-		1,830		1,370
	Preferred Member Units	(8)		-		986		-		-		1,640		-		1,640
	Warrants	(8)		-		(10)		-		10		-		10		-
CMS Minerals Investments	Member Units	(9)		-		453		13		1,624		453		107		1,970
Café Brazil, LLC	Member Units	(8)		-		460		31		2,030		460		-		2,490
California Splendor Holdings LLC	Preferred Member Units	(9)		-		2,897		125		6,241		2,897		-		9,138
	Preferred Member Units	(9)		-		-		623		8,255		623		-		8,878
	11.00% (L+10.00%, Floor 1.00%) Secured Debt	(9)		-		36		1,708		35,832		113		8,129		27,816
Clad-Rex Steel, LLC	Member Units	(5)		-		810		143		8,610		810		-		9,420
	Member Units	(5)		-		-		-		530		-		-		530
	10.50% (L+9.50%, Floor 1.00%) Secured Debt	(5)		-		-		589		10,853		-		469		10,384
	10.00% Secured Debt	(5)		-		-		55		1,100		-		14		1,086
Cody Pools, Inc.	Preferred Member Units	(8)		-		7,260		106		14,940		7,260		-		22,200
	12.25% (L+10.50%, Floor 1.75%) Secured Debt	(8)		-		(30)		843		14,216		30		2,400		11,846
Datacom, LLC	Preferred Member Units	(8)		-		-		-		-		2,610		-		2,610
	5.00% Secured Debt	(8)		-		-		336		-		8,175		54		8,121
Direct Marketing Solutions, Inc.	Preferred Stock	(9)		-		(1,560)		-		19,380		-		1,560		17,820
	12.00% (L+11.00%, Floor 1.00%) Secured Debt	(9)		-		-		932		15,007		18		-		15,025
GRT Rubber Technologies LLC	Member Units	(8)		-		-		2,192		44,900		-		-		44,900
	7.09% (L+7.00%) Secured Debt	(8)		-		-		600		16,775		-		-		16,775
Gamber-Johnson Holdings, LLC	Member Units	(5)		-		912		3,477		52,490		3,760		-		56,250
	9.00% (L+7.00%, Floor 2.00%) Secured Debt	(5)		-		(30)		954		19,838		830		30		20,638
	9.00% (L+7.00%, Floor 2.00%) Secured Debt	(5)		-		(1)		4		-		1		1		-
Jensen Jewelers of Idaho, LLC	Member Units	(9)		-		1,990		597		7,620		1,990		-		9,610
	10.00% (Prime+6.75%, Floor 2.00%) Secured Debt	(9)		-		(7)		167		3,400		7		407		3,000
Kickhaefer Manufacturing Company, LLC	Member Units	(5)		-		-		-		12,240		-		-		12,240
	11.50% Secured Debt	(5)		-		-		1,296		22,269		29		1,200		21,098
	Member Units	(5)		-		50		50		1,160		50		-		1,210
	9.00% Secured Debt	(5)		-		-		177		3,909		-		16		3,893
MH Corbin Holding LLC	13.00% (10.00% Cash, 3.00% PIK) Secured Debt	(5)		-		(521)		569		8,280		17		681		7,616
	Preferred Member Units	(5)		-		(2,370)		-		2,370		-		2,370		-
MSC Adviser I, LLC	Member Units	(8)		-		4,970		2,449		116,760		4,970		-		121,730
Market Force Information, LLC	12.00% PIK Secured Debt	(9)		-		(294)		-		13,562		-		294		13,268
	12.00% (L+11.00%, Floor 1.00%) Secured Debt	(9)		-		-		178		1,600		1,800		-		3,400
Mystic Logistics Holdings, LLC	Common Stock	(6)		-		(3,070)		548		8,990		-		3,070		5,920
	12.00% Secured Debt	(6)		-		-		410		6,723		5		24		6,704
	12.00% Secured Debt	(6)		-		-		2		-		-		-		-
OMi Holdings, Inc.	Common Stock	(8)		-		(1,550)		1,080		20,380		-		1,550		18,830
PPL RVs, Inc.	Common Stock	(8)		-		1,630		569		11,500		1,630		-		13,130

Table of Contents


							Amount of
							Interest,
							Fees or
			Amount of		Amount of		Dividends		December 31,						June 30,
			Realized		Unrealized		Credited to		2020		Gross		Gross		2021
Company	Investment(1)(10)(11)	Geography	Gain/(Loss)		Gain/(Loss)		Income(2)		Fair Value		Additions(3)		Reductions(4)		Fair Value
	7.50% (L+7.00%, Floor 0.50%) Secured Debt	(8)		-		(14)		470		11,806		27		214		11,619
Principle Environmental, LLC	13.00% Secured Debt	(8)		-		(62)		430		6,397		12		62		6,347
	Common Stock	(8)		-		(440)		-		-		1,200		440		760
	Preferred Member Units	(8)		-		(360)		-		10,500		-		360		10,140
Quality Lease Service, LLC	Member Units	(7)		-		(311)		-		4,460		-		1,561		2,899
Trantech Radiator Topco, LLC	Common Stock	(7)		-		(40)		58		6,030		-		40		5,990
	12.00% Secured Debt	(7)		-		-		538		8,644		10		-		8,654
Ziegler’s NYPD, LLC	Preferred Member Units	(8)		-		290		-		1,780		290		-		2,070
	14.00% Secured Debt	(8)		-		-		194		2,750		-		-		2,750
	12.00% Secured Debt	(8)		-		-		38		625		-		-		625
	6.50% Secured Debt	(8)		-		21		33		979		21		-		1,000
Other controlled investments
2717 MH, L.P.		(8)		-		-		-		250		-		250		-
	LP Interests (2717 MH, L.P.)	(8)		-		-		-		2,702		46		-		2,748
ASC Interests, LLC	Member Units	(8)		-		(110)		-		1,120		-		110		1,010
	13.00% Secured Debt	(8)		-		-		126		1,715		110		-		1,825
ATS Workholding, LLC	5.00% Secured Debt	(9)		-		(305)		-		3,347		-		385		2,962
Barfly Ventures, LLC	Member Units	(5)		-		116		-		1,584		116		-		1,700
	7.00% Secured Debt	(5)		-		-		45		343		368		-		711
Bolder Panther Group, LLC	14.00% Class A Preferred Member Units	(9)		-		-		704		10,194		-		-		10,194
	8.00% Class B Preferred Member Units	(9)		-		3,420		1,135		14,000		3,420		-		17,420
	10.50% (L+9.00%, Floor 1.50%) Secured Debt	(9)		-		-		1,514		27,225		525		500		27,250
Bond-Coat, Inc.		(8)		(2,320)		4,310		-		2,040		4,310		6,350		-
Brewer Crane Holdings, LLC	Preferred Member Units	(9)		-		(710)		367		5,850		-		710		5,140
	11.00% (L+10.00%, Floor 1.00%) Secured Debt	(9)		-		-		473		8,513		10		248		8,275
Bridge Capital Solutions Corporation	13.00% Secured Debt	(6)		-		-		925		8,403		349		-		8,752
	Warrants	(6)		-		510		-		3,220		510		-		3,730
	Preferred Member Units	(6)		-		-		50		1,000		-		-		1,000
	13.00% Secured Debt	(6)		-		-		67		998		1		-		999
CBT Nuggets, LLC	Member Units	(9)		-		6,540		678		46,080		6,540		-		52,620
Centre Technologies Holdings, LLC	Preferred Member Units	(8)		-		(320)		60		6,160		-		320		5,840
	12.00% (L+10.00%, Floor 2.00%) Secured Debt	(8)		-		-		667		11,549		22		1,906		9,665
Chamberlin Holding LLC	Member Units	(8)		-		(1,420)		3,559		28,070		-		1,420		26,650
	9.00% (L+8.00%, Floor 1.00%) Secured Debt	(8)		-		(22)		691		15,212		22		1,417		13,817
	Member Units	(8)		-		110		34		1,270		110		-		1,380
Charps, LLC	Preferred Member Units	(5)		-		1,060		1,543		10,520		1,060		-		11,580
	10.00% Unsecured Debt	(5)		-		(382)		683		8,475		262		3,646		5,091
	0.15 Secured Debt	(5)		-		-		4		669		-		669		-
Colonial Electric Company LLC	Preferred Member Units	(6)		-		-		100		-		7,680		-		7,680
	12.00% Secured Debt	(6)		-		-		1,162		-		24,958		-		24,958
CompareNetworks Topco, LLC	Preferred Member Units	(9)		-		3,250		158		6,780		3,250		-		10,030
	10.00% (L+9.00%, Floor 1.00%) Secured Debt	(9)		-		(9)		430		7,954		9		709		7,254
Copper Trail Energy Fund I, LP - CTMH	LP Interests (CTMH, LP)	(9)		-		-		-		747		-		37		710
Datacom, LLC	Preferred Member Units	(8)		(6,030)		6,030		-		-		6,030		6,030		-
	Preferred Member Units	(8)		(1,294)		1,294		-		-		1,294		1,294		-
	10.50% PIK Secured Debt	(8)		(1,801)		1,945		1		10,531		1,945		12,476		-
	8.00% Secured Debt	(8)		(1,800)		185		-		1,615		185		1,800		-
Digital Products Holdings LLC	Preferred Member Units	(5)		-		-		100		9,835		-		-		9,835
	11.00% (L+10.00%, Floor 1.00%) Secured Debt	(5)		-		-		1,000		18,077		22		660		17,439
Garreco, LLC	Member Units	(8)		-		350		-		1,410		350		-		1,760

Table of Contents


							Amount of
							Interest,
							Fees or
			Amount of		Amount of		Dividends		December 31,						June 30,
			Realized		Unrealized		Credited to		2020		Gross		Gross		2021
Company	Investment(1)(10)(11)	Geography	Gain/(Loss)		Gain/(Loss)		Income(2)		Fair Value		Additions(3)		Reductions(4)		Fair Value
	9.00% (L+8.00%, Floor 1.00%, Ceiling 1.50%) Secured Debt	(8)		-		-		204		4,519		-		-		4,519
Gulf Manufacturing, LLC	Member Units	(8)		-		790		347		4,510		790		-		5,300
Gulf Publishing Holdings, LLC	12.50% (6.25% Cash, 6.25% PIK) Secured Debt	(8)		-		(1,752)		849		12,044		849		2,171		10,722
	10.50% (5.25% Cash, 5.25% PIK) (L+9.50%, Floor 1.00%) Secured Debt	(8)		-		-		14		250		14		7		257
Harrison Hydra-Gen, Ltd.	Common Stock	(8)		-		(600)		-		5,450		-		600		4,850
J&J Services, Inc.	Preferred Stock	(7)		-		370		-		12,680		370		-		13,050
	11.50% Secured Debt	(7)		-		(17)		746		12,800		17		817		12,000
KBK Industries, LLC	Member Units	(5)		-		330		221		13,200		330		-		13,530
MS Private Loan Fund	LP Interests	(8)		-		-		-		-		285		-		285
	5.00% Unsecured Debt	(8)		-		-		300		-		16,220		-		16,220
MSC Income Fund Inc.	5.00% Unsecured Debt	(8)		-		210		891		-		39,840		-		39,840
NAPCO Precast, LLC	Member Units	(8)		-		(530)		81		16,100		-		530		15,570
NRI Clinical Research, LLC	9.00% Secured Debt	(9)		-		(20)		262		5,620		20		865		4,775
	Member Units	(9)		-		2,434		399		5,600		2,434		-		8,034
NRI Clinical Research, LLC	Warrants	(9)		-		540		-		1,490		540		-		2,030
NRP Jones, LLC	Member Units	(5)		-		419		(45)		2,821		419		-		3,240
	12.00% Secured Debt	(5)		-		-		126		2,080		-		-		2,080
Nebraska Vet AcquireCo, LLC (NVS)	12.00% Secured Debt	(5)		-		-		651		10,395		9		-		10,404
	Preferred Member Units	(5)		-		-		-		6,500		-		-		6,500
NexRev LLC	Preferred Member Units	(8)		-		1,810		40		1,470		1,810		-		3,280
	11.00% Secured Debt	(8)		-		178		946		16,726		197		436		16,487
	Preferred Member Units	(5)		-		1,570		-		10,780		1,570		-		12,350
	11.00% Secured Debt	(5)		-		26		1,017		17,193		47		-		17,240
	7.50% (L+6.50%, Floor 1.00%) Secured Debt	(5)		-		-		6		-		400		400		-
Pearl Meyer Topco LLC	Member Units	(6)		-		2,550		1,528		15,940		2,550		-		18,490
	12.00% Secured Debt	(6)		-		272		2,170		37,202		311		3,840		33,673
Pegasus Research Group, LLC	Member Units	(8)		-		(560)		-		8,830		-		560		8,270
Principle Environmental, LLC	Warrants	(8)		-		330		-		870		330		1,200		-
River Aggregates, LLC	Member Units	(8)		-		50		-		3,240		50		-		3,290
Tedder Industries, LLC	Preferred Member Units	(9)		-		-		-		8,136		-		-		8,136
	12.00% Secured Debt	(9)		-		-		960		16,300		582		1,599		15,283
UnionRock Energy Fund II, LP	LP Interests	(9)		-		737		-		2,894		2,113		220		4,787
Vision Interests, Inc.	13.00% Secured Debt	(9)		-		-		133		2,028		-		-		2,028
	Series A Preferred Stock	(9)		-		(160)		-		3,160		-		160		3,000
Other Amounts related to investments transferred to or from other 1940 Act classification during the period				-		-		-		-		-		-		-
Total Control Investments			$	(13,245)	$	45,084	$	51,052	$	1,113,725	$	177,453	$	81,385	$	1,209,793
Affiliate Investments
AAC Holdings, Inc.	Common Stock	(7)	$	-	$	(1,069)	$	-	$	3,148	$	-	$	1,069	$	2,079
	(L+11.00%, Floor 1.00%) Secured Debt	(7)		-		-		(16)		-		-		-		-
	18.00% (10.00% Cash, 8.00% PIK) Secured Debt	(7)		-		(89)		883		9,187		401		89		9,499
AAC Holdings, Inc.	Warrants	(7)		-		(998)		-		2,938		-		998		1,940
AFG Capital Group, LLC	Preferred Member Units	(8)		-		1,150		-		5,810		1,150		-		6,960
	10.00% Secured Debt	(8)		-		-		20		491		-		173		318
BBB Tank Services, LLC	Member Units	(8)		-		(280)		-		280		-		280		-
	15.00% PIK Preferred Stock (non-voting)	(8)		-		(162)		11		151		11		162		-
	12.00% (L+11.00%, Floor 1.00%) Unsecured Debt	(8)		-		-		317		4,722		27		-		4,749
Boccella Precast Products LLC	Member Units	(6)		-		(1,090)		370		6,040		-		1,090		4,950
Buca C, LLC	6.00% PIK Preferred Member Units	(7)		-		-		-		-		-		-		-
	10.25% (L+9.25%, Floor 1.00%) Secured Debt	(7)		-		(373)		747		14,256		487		373		14,370
CAI Software LLC	Member Units	(6)		-		6,741		1,900		7,190		6,741		1,921		12,010
	12.50% Secured Debt	(6)		-		37		3,350		47,474		23,600		3,353		67,721

Table of Contents


							Amount of
							Interest,
							Fees or
			Amount of		Amount of		Dividends		December 31,						June 30,
			Realized		Unrealized		Credited to		2020		Gross		Gross		2021
Company	Investment(1)(10)(11)	Geography	Gain/(Loss)		Gain/(Loss)		Income(2)		Fair Value		Additions(3)		Reductions(4)		Fair Value
Chandler Signs Holdings, LLC	Class A Units	(8)		-		(810)		-		1,460		-		810		650
Classic H&G Holdings, LLC	Preferred Member Units	(6)		-		2,250		570		9,510		2,250		-		11,760
	10.00% Secured Debt	(6)		-		(64)		1,412		24,800		64		5,590		19,274
Congruent Credit Opportunities Funds	LP Interests (Fund II)	(8)		(4,449)		4,355		-		94		4,355		4,449		-
	LP Interests (Congruent Credit Opportunities Fund III, LP)	(8)		-		(178)		389		11,540		-		178		11,362
Copper Trail Energy Fund I, LP	LP Interests (Copper Trail Energy Fund I, LP)	(9)		-		61		319		1,782		61		-		1,843
Dos Rios Partners	LP Interests (Dos Rios Partners, LP)	(8)		-		1,608		-		5,417		1,608		-		7,025
	LP Interests (Dos Rios Partners - A, LP)	(8)		-		510		-		1,720		510		-		2,230
Dos Rios Stone Products LLC	Class A Preferred Units	(8)		-		(230)		-		1,250		-		230		1,020
EIG Fund Investments	LP Interests (EIG Global Private Debt Fund-A, L.P.)	(8)		8		92		33		526		126		166		486
East Teak Fine Hardwoods, Inc.	Common Stock	(7)		-		130		-		300		130		-		430
Freeport Financial SBIC Fund LP	LP Interests (Freeport Financial SBIC Fund LP)	(5)		-		386		-		5,264		386		-		5,650
	LP Interests (Freeport First Lien Loan Fund III LP)	(5)		-		-		455		10,321		-		2,317		8,004
GFG Group, LLC.	Preferred Member Units	(5)		-		-		290		-		4,900		-		4,900
	12.00% Secured Debt	(5)		-		-		822		-		15,626		3,200		12,426
HPEP 3, L.P.	LP Interests (HPEP 3, L.P.)	(8)		-		531		-		3,258		905		-		4,163
Hawk Ridge Systems, LLC	Preferred Member Units	(9)		-		2,600		691		8,030		2,600		-		10,630
	Preferred Member Units	(9)		-		140		-		420		140		-		560
	9.50% Secured Debt	(9)		-		(17)		919		18,400		17		17		18,400
	9.50% Secured Debt	(9)		-		-		4		-		-		-		-
Houston Plating and Coatings, LLC	8.00% Unsecured Convertible Debt	(8)		-		-		121		2,900		-		-		2,900
	Member Units	(8)		-		(1,560)		2		5,080		-		1,560		3,520
I-45 SLF LLC	Member Units (Fully diluted 20.0%; 24.40% profits interest) (8)	(8)		-		877		935		15,789		1,677		2,000		15,466
L.F. Manufacturing Holdings, LLC	Member Units	(8)		-		(140)		-		2,050		-		140		1,910
	14.00% PIK Preferred Member Units (non-voting)	(8)		-		-		7		93		7		-		100
OnAsset Intelligence, Inc.	12.00% PIK Secured Debt	(8)		-		-		447		7,301		447		-		7,748
	Common Stock	(8)		-		(830)		-		-		830		830		-
	10.00% PIK Unsecured Debt	(8)		-		-		3		64		6		3		67
OnAsset Intelligence, Inc.	Warrants	(8)		-		830		-		-		830		830		-
Rocaceia, LLC (Quality Lease and Rental Holdings, LLC)	12.00% Secured Debt	(8)		(356)		-		-		-		-		-		-
SI East, LLC (Stavig)	Preferred Member Units	(7)		-		5,250		-		9,780		5,250		-		15,030
	8.75% Secured Debt	(7)		-		(60)		1,456		32,961		57		3,847		29,171
Slick Innovations, LLC	12.00% Secured Debt	(6)		-		(23)		362		5,720		23		343		5,400
	Common Stock	(6)		-		180		-		1,330		180		-		1,510
	Warrants	(6)		-		40		-		360		40		-		400
Superior Rigging & Erecting Co.	Preferred Member Units	(7)		-		-		-		4,499		-		-		4,499
	12.00% Secured Debt	(7)		-		-		1,314		21,298		17		-		21,315
UniTek Global Services, Inc.	20.00% PIK Preferred Stock	(6)		-		(239)		149		2,833		149		239		2,743
	20.00% PIK Preferred Stock	(6)		-		(375)		-		374		-		374		-
	15.00% PIK Secured Debt	(6)		-		355		61		-		1,550		42		1,508
	8.50% (6.50% cash, 2.00% PIK) (2.00% PIK, L+5.50% Floor 1.00%) Secured Debt	(6)		-		62		130		2,426		163		442		2,147
Volusion, LLC	8.00% Unsecured Convertible Debt	(8)		-		118		16		291		118		-		409
	11.50% Secured Debt	(8)		-		992		1,170		19,243		991		-		20,234
	Preferred Member Units	(8)		-		-		-		5,990		-		-		5,990
Other Amounts related to				13,907		(4,476)		2,852		20,140		2,591		22,731		-

Table of Contents


							Amount of
							Interest,
							Fees or
			Amount of		Amount of		Dividends		December 31,						June 30,
			Realized		Unrealized		Credited to		2020		Gross		Gross		2021
Company	Investment(1)(10)(11)	Geography	Gain/(Loss)		Gain/(Loss)		Income(2)		Fair Value		Additions(3)		Reductions(4)		Fair Value
investments transferred to or from other 1940 Act classification during the period
Total Affiliate investments			$	9,110	$	16,232	$	22,511	$	366,301	$	81,021	$	59,846	$	387,476

(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 included in Item 1. Consolidated Financial Statements of this Quarterly Report on Form 10-Q.

(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)

(4)

(5)

Portfolio company located in the Midwest region as determined by location of the corporate headquarters. The fair value as of June 30, 2021 for control investments located in this region was $256,063. This represented 16.0% of net assets as of June 30, 2021. The fair value as of June 30, 2021 for affiliate investments located in this region was $30,980. This represented 1.9% of net assets as of June 30, 2021.

(6)

Portfolio company located in the Northeast region as determined by location of the corporate headquarters. The fair value as of June 30, 2021 for control investments located in this region was $111,907. This represented 7.0% of net assets as of June 30, 2021. The fair value as of June 30, 2021 for affiliate investments located in this region was $129,419. This represented 8.1% of net assets as of June 30, 2021.

(7)

Portfolio company located in the Southeast region as determined by location of the corporate headquarters. The fair value as of June 30, 2021 for control investments located in this region was $42,591. This represented 2.7% of net assets as of June 30, 2021. The fair value as of June 30, 2021 for affiliate investments located in this region was $98,336. This represented 6.1% of net assets as of June 30, 2021.

(8)

Portfolio company located in the Southwest region as determined by location of the corporate headquarters. The fair value as of June 30, 2021 for control investments located in this region was $499,378. This represented 31.1% of net assets as of June 30, 2021. The fair value as of June 30, 2021 for affiliate investments located in this region was $97,305. This represented 6.1% of net assets as of June 30, 2021.

(9)

Portfolio company located in the West region as determined by location of the corporate headquarters. The fair value as of June 30, 2021 for control investments located in this region was $299,854. This represented 18.7% of net assets as of June 30, 2021. The fair value as of June 30, 2021 for affiliate investments located in this region was $31,433. This represented 2.0% of net assets as of June 30, 2021.

Table of Contents

(10)	All of the Company’s portfolio investments are generally subject to restrictions on resale as “restricted securities,” unless otherwise noted.

(11)

(12)	Investment has an unfunded commitment as of June 30, 2021 (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 the factors referenced in Item 1A entitled “Risk Factors” below in Part II of this Quarterly Report on Form 10-Q, if any, and discussed in Item 1A entitled “Risk Factors” in Part I of our Annual Report on Form 10-K for the year ended December 31, 2021, filed with the Securities and Exchange Commission (“SEC”) on February 25, 2022 and elsewhere in this Quarterly Report on Form 10-Q and our other SEC filings. Other factors that could cause actual results to differ materially include changes in the economy and future changes in laws or regulations and conditions in our operating areas.

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.

This discussion should be read in conjunction with our consolidated financial statements as of December 31, 2021, and for the year then ended, and Management’s Discussion and Analysis of Financial Condition and Results of Operations, both contained in our Annual Report on Form 10-K for the year ended December 31, 2021, as well as the consolidated financial statements (unaudited) and notes to the consolidated financial statements (unaudited) contained in this report.

ORGANIZATION

Main Street Capital Corporation (“MSCC” or “Main Street”) is a principal investment firm. MSCC wholly owns several investment funds, including Main Street Mezzanine Fund, LP (“MSMF”) and Main Street Capital III, LP (“MSC III” and, together with MSMF, the “Funds”), and each of their general partners. 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.

COVID-19 UPDATE

The COVID-19 pandemic and its effect on the U.S. and global economies, including the current related impacts to supply chain delays, labor and material availability and price increases, 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 June 30, 2022, we continued to work collectively with our employees and portfolio companies to navigate these significant challenges. Neither our management team 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 evolving situation, we are unable to predict with any certainty the extent to which these events, or any future impacts related to the pandemic, 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 in the future.

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OVERVIEW OF OUR BUSINESS

Our principal investment objective is to maximize our portfolio’s total return by generating current income from our debt investments and current income 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. We seek to achieve our investment objective through our lower middle market (“LMM”), Private Loan (as defined below) and middle market (“Middle Market”) investment strategies. Our LMM investment strategy involves investments in companies that generally have annual revenues between $10 million and $150 million and our LMM portfolio investments generally range in size from $5 million to $75 million. Our Middle Market investment strategy involves investments in companies that are generally larger in size than our LMM 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 $25 million. Our private loan (“Private Loan”) investment strategy involves investments in companies that are consistent with the size of the companies in our LMM and Middle Market investment strategies, and our Private Loan investments generally range in size from $10 million to $75 million.

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.

Private Loan investments generally consist of loans that have been originated directly by us or through strategic relationships with other investment funds on a collaborative basis and are often referred to in the debt markets as “club deals.” Our Private Loan portfolio debt investments are generally secured by a first 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. We may also invest alongside the sponsor in the equity securities of our Private Loan portfolio companies.

Our Middle Market portfolio investments primarily consist of direct investments in or secondary purchases of interest-bearing syndicated loans or 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 debt investments are generally secured by a first 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 other portfolio (“Other Portfolio”) investments primarily consist of investments that are not consistent with the typical profiles for our LMM, Private Loan or Middle Market 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.

Subject to changes in our cash and overall liquidity, our Investment Portfolio may also include short-term portfolio investments that are atypical of our LMM, Private Loan and Middle Market portfolio investments in that they are intended to be a short-term deployment of capital. These assets are typically expected to be liquidated in one year or less and are not expected to be a significant portion of the overall Investment Portfolio.

Our external asset management business is conducted through MSC Adviser I, LLC (the “External Investment Manager”). 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 MSC Income Fund, Inc. (“MSC Income”) and its other clients. Through this agreement, we share employees with the External Investment Manager, including their related infrastructure, business relationships, management expertise and capital raising capabilities.

Our portfolio investments are generally made through MSCC, the Taxable Subsidiaries and the Funds. MSCC, the Taxable Subsidiaries and the Funds share the same investment strategies and criteria, although they are subject to different regulatory regimes. An investor’s return in MSCC will depend, in part, on the Taxable Subsidiaries’ and the Funds’ investment returns as they are wholly-owned subsidiaries of MSCC.

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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 better alignment of interests between our management team, our employees and our shareholders, and a beneficial operating expense structure when compared to other publicly traded and privately held investment firms which are externally managed. Our internally managed structure allows us the opportunity to leverage our non-interest operating expenses as we grow our Investment Portfolio and our External Investment Manager’s asset management business. The ratio of our total operating expenses, excluding interest expense, as a percentage of our quarterly average total assets was 1.5% and 1.4%, for the trailing twelve months ended June 30, 2022 and 2021, respectively, and 1.5% for the year ended December 31, 2021. The ratio of our total operating expenses, including interest expense, as a percentage of our quarterly average total assets was 3.3% for each of the trailing twelve months ended June 30, 2022 and 2021, and 3.4% for the year ended December 31, 2021. Our ratio of expenses as a percentage of our average net asset value is described in greater detail in Note F – Financial Highlights to the consolidated financial statements included in Item 1. Consolidated Financial Statements of this Quarterly Report on Form 10-Q.

Additionally, the External Investment Manager has entered into an Investment Management Agreement with MS Private Loan Fund I, LP, a private investment fund with a strategy to co-invest with Main Street in Private Loan portfolio investments (the “Private Loan Fund”), pursuant to which the External Investment Manager provides investment advisory and management services to the Private Loan Fund in exchange for an asset-based fee and certain incentive fees.

The External Investment Manager earns management fees based on the assets of the funds and accounts under management and may earn incentive fees, or a carried interest, based on the performance of the funds and accounts 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 earned from the External Investment Manager. The total contribution to our net investment income was $5.2 million and $3.8 million for the three months ended June 30, 2022 and 2021, respectively. The External Investment Manager earned base management fee income of $5.4 million and $4.2 million during the three months ended June 30, 2022 and 2021, respectively. During the three months ended June 30, 2022, the External Investment Manager earned $0.1 million in incentive fee income. No incentive fee income was earned in the three months ended June 30, 2021. During the three

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months ended June 30, 2022, the External Investment Manager earned $0.2 million in administrative services fee income. No administrative services fee income was earned in the three months ended June 30, 2021. Our total expenses are net of expenses allocated to the External Investment Manager for the three months ended June 30, 2022 and 2021 of $3.5 million and $2.6 million, respectively. The total contribution to our net investment income was $10.3 million and $7.4 million for the six months ended June 30, 2022 and 2021, respectively. The External Investment Manager earned base management fee income of $10.9 million and $8.1 million during the six months ended June 30, 2022 and 2021, respectively. During the six months ended June 30, 2022, the External Investment Manager earned $0.2 million in incentive fee income. No incentive fee income was earned in the six months ended June 30, 2021. During the six months ended June 30, 2022, the External Investment Manager earned $0.3 million in administrative services fee income. No administrative services fee income was earned in the six months ended June 30, 2021. Our total expenses are net of expenses allocated to the External Investment Manager for the six months ended June 30, 2022 and 2021 of $6.3 million and $5.0 million, respectively.

We have received an exemptive order from the SEC permitting co-investments among us, MSC Income and other funds and clients advised by the External Investment Manager in certain negotiated transactions where co-investing would otherwise be prohibited under the 1940 Act. We have made co-investments with, and in the future intend to continue to make co-investments with MSC Income, the Private Loan Fund and other clients advised by the External Investment Manager, 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 us and the External Investment Manager’s advised clients, as applicable, and if it is appropriate, to propose an allocation of the investment opportunity between such parties. Because the External Investment Manager may receive performance-based fee compensation from funds and clients advised by the External Investment Manager, this may provide the Company and the External Investment Manager an incentive to allocate opportunities to other participating funds and clients instead of us. However, both we and the External Investment Manager have policies and procedures in place to manage this conflict, including oversight by the independent members of our Board of Directors. Additional information regarding the operation of the co-investment program is set forth in the order granting exemptive relief, which may be reviewed on the SEC’s website at www.sec.gov. In addition to the co-investment program described above, we also co-invest in syndicated deals and other transactions where price is the only negotiated point by us and our affiliates.

INVESTMENT PORTFOLIO SUMMARY

The following tables provide a summary of our investments in the LMM, Private Loan and Middle Market portfolios as of June 30, 2022 and December 31, 2021 (this information excludes the Other Portfolio investments, short-term portfolio investments and the External Investment Manager which are discussed further below):


	As of June 30, 2022
	LMM (a)			Private Loan			Middle Market

	(dollars in millions)
Number of portfolio companies		75			82			34
Fair value	$	1,816.3		$	1,309.0		$	363.5
Cost	$	1,508.9		$	1,347.9		$	419.0
Debt investments as a % of portfolio (at cost)		71.9	%		96.1	%		92.9	%
Equity investments as a % of portfolio (at cost)		28.1	%		3.9	%		7.1	%
% of debt investments at cost secured by first priority lien		99.0	%		99.4	%		99.2	%
Weighted-average annual effective yield (b)		11.2	%		8.5	%		8.0	%
Average EBITDA (c)	$	7.5		$	41.2		$	71.4

(a)	At June 30, 2022, we had equity ownership in all of our LMM portfolio companies, and the average fully diluted equity ownership in those portfolio companies was 41%.

(b)

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what an investor in shares of our common stock will realize on its investment because it does not reflect changes in the market value of our stock, our utilization of debt capital in our capital structure, 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 Private Loan and Middle Market portfolios. These calculations exclude certain portfolio companies, including three LMM 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 December 31, 2021
	LMM (a)			Private Loan			Middle Market

	(dollars in millions)
Number of portfolio companies		73			75			36
Fair value	$	1,716.4		$	1,141.8		$	395.2
Cost	$	1,455.7		$	1,157.5		$	440.9
Debt investments as a % of portfolio (at cost)		70.9	%		95.7	%		93.3	%
Equity investments as a % of portfolio (at cost)		29.1	%		4.3	%		6.7	%
% of debt investments at cost secured by first priority lien		99.0	%		98.7	%		98.7	%
Weighted-average annual effective yield (b)		11.2	%		8.2	%		7.5	%
Average EBITDA (c)	$	6.2		$	41.3		$	76.0

(a)	At December 31, 2021, we had equity ownership in all of our LMM portfolio companies, and the average fully diluted equity ownership in those portfolio companies was 40%.

(b)

The weighted-average annual effective yields were computed using the effective interest rates for all debt investments at cost as of December 31, 2021, 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 on our debt portfolio as of December 31, 2021 including debt investments on non-accrual status was 10.6% for our LMM portfolio, 8.0% for our Private Loan portfolio and 6.9% for our Middle Market portfolio. The weighted-average annual effective yield is not reflective of what an investor in shares of our common stock will realize on its investment because it does not reflect changes in the market value of our stock, our utilization of debt capital in our capital structure, 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 Private Loan and Middle Market portfolios. These calculations exclude certain portfolio companies, including three LMM portfolio companies, three Private Loan portfolio companies and one Middle Market portfolio company, 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.

For the three months ended June 30, 2022 and 2021, we achieved an annualized total return on investments of 6.5% and 19.7%, respectively. For the six months ended June 30, 2022 and 2021, we achieved an annualized total return on investments of 9.2% and 16.0%, respectively. For the year ended December 31, 2021, we achieved an annualized total return on investments of 16.6%. Total return on investments is calculated using the interest, dividend and fee income, as well as the realized and unrealized change in fair value of the Investment Portfolio for the specified period. Our total return on investments is not reflective of what an investor in shares of our common stock will realize on its investment because it does not reflect changes in the market value of our stock, our utilization of debt capital in our capital structure, our expenses or any sales load paid by an investor.

As of June 30, 2022, we had Other Portfolio investments in 14 companies, collectively totaling $108.8 million in fair value and $116.1 million in cost basis and which comprised 2.9% and 3.4% of our Investment Portfolio at fair value and cost, respectively. As of December 31, 2021, we had Other Portfolio investments in 13 companies, collectively totaling $166.1 million in fair value and $173.7 million in cost basis and which comprised 4.7% and 5.3% of our Investment Portfolio at fair value and cost, respectively.

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As of June 30, 2022, we had one short-term portfolio investment, which was a secured debt investment that had $1.9 million in fair value and $2.0 million in cost basis and which comprised 0.1% of our Investment Portfolio at both fair value and cost. As of December 31, 2021, we had one short-term portfolio investment, which was a secured debt investment that had $2.0 million in both fair value and cost basis and which comprised 0.1% of our Investment Portfolio at both fair value and cost.

As previously discussed, the External Investment Manager is a wholly-owned subsidiary that is treated as a portfolio investment. As of June 30, 2022, this investment had a fair value of $118.3 million and a cost basis of $29.5 million, which comprised 3.2% and 0.9% of our Investment Portfolio at fair value and cost, respectively. As of December 31, 2021, this investment had a fair value of $140.4 million and a cost basis of $29.5 million, which comprised 3.9% and 0.9% of our Investment Portfolio at fair value and cost, respectively.

CRITICAL ACCOUNTING POLICIES

The preparation of financial statements and related disclosures in conformity with generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and contingent assets and liabilities at the date of the financial statements, and revenues and expenses during the periods reported. Actual results could materially differ from those estimates. Critical accounting policies are those that require management to make subjective or complex judgments about the effect of matters that are inherently uncertain and may change in subsequent periods. Changes that may be required in the underlying assumptions or estimates in these areas could have a material impact on our current and future financial condition and results of operations.

Management has discussed the development and selection of each critical accounting policy and estimate with the Audit Committee of the Board of Directors. Our critical accounting policies and estimates include the Investment Portfolio Valuation and Revenue Recognition policies described below. Our significant accounting policies are described in greater detail in Note B—Summary of Significant Accounting Policies to the consolidated financial statements included in Item 1. Consolidated Financial Statements of this Quarterly Report on Form 10-Q.

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. We consider this determination to be a critical accounting estimate, given the significant judgments and subjective measurements required. As of both June 30, 2022 and December 31, 2021, our Investment Portfolio valued at fair value represented 97% 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 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 included in Item 1. Consolidated Financial Statements of this Quarterly Report on Form 10-Q 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.

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serve as the Board of Directors’ valuation designee. We adopted the Valuation Procedures effective April 1, 2021. We believe our Investment Portfolio as of June 30, 2022 and December 31, 2021 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 its debt obligation, 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 obligation, 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 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.—Summary of Significant Accounting Policies—Income Taxes included in Item 1. Consolidated Financial Statements of this Quarterly Report on Form 10-Q), 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 June 30, 2022 and 2021, (i) 1.7% and 3.4%, respectively, of our total investment income was attributable to PIK interest income not paid currently in cash and (ii) 0.2% and 0.6%, respectively, of our total investment income was attributable to cumulative dividend income not paid currently in cash. For the six months ended June 30, 2022 and 2021, (i) 1.4% and 3.6%, respectively, of our total investment income was attributable to PIK interest income not paid currently in cash and (ii) 0.6% and 0.7%, respectively, of our total investment income was attributable to cumulative dividend income not paid currently in cash.

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INVESTMENT PORTFOLIO COMPOSITION

The following tables summarize the composition of our total combined LMM portfolio investments, Private Loan portfolio investments and Middle Market portfolio investments at cost and fair value by type of investment as a percentage of the total combined LMM portfolio investments, Private Loan portfolio investments and Middle Market portfolio investments as of June 30, 2022 and December 31, 2021 (this information excludes the Other Portfolio, short-term portfolio investments and the External Investment Manager).


Cost:	June 30, 2022		December 31, 2021
First lien debt	83.9	%	82.5	%
Equity	15.2	%	16.2	%
Second lien debt	0.3	%	0.6	%
Equity warrants	0.2	%	0.3	%
Other	0.4	%	0.4	%
	100.0	%	100.0	%


Fair Value:	June 30, 2022		December 31, 2021
First lien debt	74.0	%	74.3	%
Equity	25.1	%	24.6	%
Second lien debt	0.3	%	0.5	%
Equity warrants	0.2	%	0.2	%
Other	0.4	%	0.4	%
	100.0	%	100.0	%

Our LMM portfolio investments, Private Loan portfolio investments and Middle Market portfolio investments carry a number of risks including: (1) investing in companies which may have limited 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 Annual Report on Form 10-K for the fiscal year ended December 31, 2021for 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, Private Loan and Middle Market portfolio company and to monitor our expected level of returns on each of our LMM, Private Loan and Middle Market 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 June 30, 2022, our total Investment Portfolio had nine investments on non-accrual status, which comprised 0.7% of its fair value and 3.2% of its cost. As of December 31, 2021, our total Investment Portfolio had nine investments on non-accrual status, which comprised 0.7% of its fair value and 3.3% of its cost.

The operating results of our portfolio companies are impacted by changes in the broader fundamentals of the United States economy. In periods during which 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 future economic cycles or other conditions, which could also have a negative impact on our future results.

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DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS

Comparison of the three months ended June 30, 2022 and June 30, 2021

Set forth below is a comparison of the results of operations, and a reconciliation of net investment income to distributable net investment income and adjusted distributable net investment income, for the three months ended June 30, 2022 and June 30, 2021, respectively.


	Three Months Ended
	June 30,				Net Change
	2022		2021		Amount		%

	(dollars in thousands)
Total investment income	$	85,200	$	67,294	$	17,906	27	%
Total expenses		(30,474)		(24,899)		(5,575)	22	%
Net investment income		54,726		42,395		12,331	29	%
Net realized gain (loss) from investments		(5,064)		18,000		(23,064)	NM
Net unrealized appreciation (depreciation) from investments		(24,593)		44,441		(69,034)	NM
Income tax benefit (provision)		(10,320)		(9,726)		(594)	NM
Net increase in net assets resulting from operations	$	14,749	$	95,110	$	(80,361)	(84)	%


	Three Months Ended
	June 30,				Net Change
	2022		2021		Amount		%

	(dollars in thousands, except per share amounts)
Net investment income	$	54,726	$	42,395	$	12,331	29	%
Share‑based compensation expense		3,596		2,759		837	30	%
Distributable net investment income(a)	$	58,322	$	45,154	$	13,168	29	%
Deferred compensation expense (benefit)		(1,225)		482		(1,707)	NM
Adjusted distributable net investment income (b)	$	57,097	$	45,636	$	11,461	25	%
Net investment income per share—Basic and diluted	$	0.75	$	0.62	$	0.13	21	%
Distributable net investment income per share—Basic and diluted (a)	$	0.80	$	0.66	$	0.14	21	%
Adjusted distributable net investment income—Basic and diluted (b)	$	0.78	$	0.67	$	0.11	16	%

NM	Net change % 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.

(b)

Adjusted distributable net investment income is net investment income as determined in accordance with U.S. GAAP, excluding the impacts of share-based compensation expense and deferred compensation expense or benefit which are non-cash in nature. We believe presenting adjusted 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 and deferred compensation expense or benefit do not require settlement in cash. However, adjusted 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, adjusted 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

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investment income in accordance with U.S. GAAP to adjusted distributable net investment income is presented in the table above. In future quarters, we plan to eliminate the historical disclosure of distributable net investment income and present adjusted distributable net investment income under the heading of distributable net investment income.

Investment Income

Total investment income for the three months ended June 30, 2022 was $85.2 million, a 27% increase from the $67.3 million of total investment income for the corresponding period of 2021. The following table provides a summary of the changes in the comparable period activity.


	Three Months Ended
	June 30,				Net Change
	2022		2021		Amount		%

		(dollars in thousands)
Interest income	$	63,984	$	45,944	$	18,040	39	%	(a)
Dividend income		17,913		18,619		(706)	(4)	%	(b)
Fee income		3,303		2,731		572	21	%	(c)
Total investment income	$	85,200	$	67,294	$	17,906	27	%	(d)

(a)

The increase in interest income was primarily due to higher average levels of Investment Portfolio debt investments following (i) net origination activity in our LMM portfolio of $348.6 million and $52.3 million for the year ended December 31, 2021 and six months ended June 30, 2022, respectively, and (ii) net origination activity in our Private Loan portfolio of $370.3 million and $186.5 million for the year ended December 31, 2021 and six months ended June 30, 2022, respectively and a $2.3 million increase in accelerated prepayment repricing and other activity related to certain investment portfolio debt investments.

(b)

The decrease in dividend income from Investment Portfolio equity investments was primarily a result of a $3.7 million decrease related to dividend income considered to be less consistent or non-recurring, partially offset by continued strong dividend income from a variety of portfolio companies resulting from the improved operating results, financial condition and liquidity positions of certain of our portfolio companies.

(c)	The increase in fee income was primarily related to a $0.5 million increase from refinancing and prepayment of debt investments.

(d)

The increase in total investment income includes a net reduction in the impact of certain income considered less consistent or non-recurring, including a $3.7 million decrease in dividend income, partially offset by a $2.3 million increase in accelerated prepayment, repricing and other activity related to certain Investment Portfolio debt investments.

Expenses

Total expenses for the three months ended June 30, 2022 were $30.5 million, a 22% increase from the $24.9 million in the corresponding period of 2021. The following table provides a summary of the changes in the comparable period activity.


	Three Months Ended
	June 30,				Net Change
	2022		2021		Amount		%

		(dollars in thousands)
Employee compensation expenses	$	10,032	$	6,287	$	3,745	60	%	(a)
Deferred compensation plan expense (benefit)		(1,225)		608		(1,833)	(301)	%	(b)
Total compensation expense		8,807		6,895		1,912	28	%
G&A expense		4,238		3,417		821	24	%
Interest expense		17,295		14,400		2,895	20	%	(c)
Share-based compensation expense		3,596		2,759		837	30	%
Gross expenses		33,936		27,471		6,465	24	%
Allocation of expenses to the External Investment Manager		(3,462)		(2,572)		(890)	35	%
Total expenses	$	30,474	$	24,899	$	5,575	22	%

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(a)	The increase in compensation expense is primarily related to increased headcount, base compensation rates and incentive compensation accruals.

(b)

The change in the non-cash deferred compensation plan expense (benefit) was due to the comparable period reduction to compensation expense resulting from a decrease in the fair value of deferred compensation plan assets and corresponding liabilities in the second quarter of 2022 compared to an increase in such fair values in the corresponding period of 2021.

(c)

The increase in interest expense was primarily related to increased borrowings to support our investment activity, including an aggregate of $200.0 million in principal amount of our 3.00% Notes (as defined in “—Liquidity and Capital Resources—Capital Resources” below) issued in October 2021 and greater amounts of borrowings under our multi-year revolving credit facility (our “Credit Facility”).

Net Investment Income

Net investment income for the three months ended June 30, 2022 increased 29% to $54.7 million, or $0.75 per share, compared to net investment income of $42.4 million, or $0.62 per share, for the corresponding period of 2021. The increase in net investment income was principally attributable to the increase in total investment income, partially offset by higher operating expenses, both as discussed above. The increase in net investment income per share reflects these changes and the impact of the increase in weighted average shares outstanding for the three months ended June 30, 2022, 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. The increase in net investment income on a per share basis includes a $0.02 per share decrease in investment income considered less consistent or non-recurring offset by a decrease in compensation expense of $0.02 per share resulting from the comparable period difference in the fair value of deferred compensation plan assets and corresponding liabilities, both of which are discussed above.

Distributable Net Investment Income

Distributable net investment income for the three months ended June 30, 2022 increased 29% to $58.3 million, or $0.80 per share, compared with $45.2 million, or $0.66 per share, in the corresponding period of 2021. The increase in distributable net investment income was primarily due to the increased level of total investment income, partially offset by higher operating expenses, excluding share-based compensation expense, both as discussed above. The increase in distributable net investment income per share reflects these changes and the net impact of the increase in weighted average shares outstanding for the three months ended June 30, 2022, 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. The increase in distributable net investment income on a per share basis includes a $0.02 per share decrease in investment income considered less consistent or non-recurring, offset by a $0.02 per share decrease in compensation expense resulting from the comparable period difference in the fair value of deferred compensation plan assets and corresponding liabilities, both of which are discussed above.

Adjusted Distributable Net Investment Income

Adjusted distributable net investment income for the three months ended June 30, 2022 increased 25% to $57.1 million, or $0.78 per share, compared with $45.6 million, or $0.67 per share, in the corresponding period of 2021. The increase in adjusted distributable net investment income was primarily due to the increased level of total investment income, partially offset by higher operating expenses, excluding share-based compensation expense and deferred compensation expense (benefit), both as discussed above. The increase in adjusted distributable net investment income per share reflects the net impact of the increase in weighted average shares outstanding for the three months ended June 30, 2022, primarily due to shares issued through the ATM Program, shares issued pursuant to our equity incentive plans and shares issued pursuant to our dividend reinvestment plan. The increase in adjusted distributable net investment income on a per share basis includes a $0.02 per share decrease in investment income considered less consistent or non-recurring, as discussed above.

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Net Realized Gain (Loss) from Investments

The following table provides a summary of the primary components of the total net realized loss on investments of $5.1 million for the three months ended June 30, 2022:


	Three Months Ended June 30, 2022
	Full Exits			Partial Exits			Restructures			Other (a)		Total
	Net Gain/(Loss)		# of Investments	Net Gain/(Loss)		# of Investments	Net Gain/(Loss)		# of Investments	Net Gain/(Loss)		Net Gain/(Loss)

	(dollars in thousands)
LMM Portfolio	$	-	-	$	-	-	$	-	-	$	(450)	$	(450)
Private Loan Portfolio		-	-		-	-		-	-		216		216
Middle Market Portfolio		(6,069)	1		-	-		-	-		-		(6,069)
Other Portfolio		-	-		1,038	1		-	-		201		1,239
Short-term Portfolio		-	-		-	-		-	-		-		-
Total net realized gain/(loss)	$	(6,069)	1	$	1,038	1	$	-	-	$	(33)	$	(5,064)

(a)	Other activity includes realized gains and losses from transactions involving 10 portfolio companies which are not considered to be significant individually or in the aggregate.

Net Unrealized Appreciation (Depreciation)

The following table provides a summary of the total net unrealized depreciation of $24.6 million for the three months ended June 30, 2022:


	Three Months Ended June 30, 2022
			Private		Middle
	LMM(a)		Loan		Market		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	$	0.5	$	(2.0)	$	6.0	$	(1.2)		$	3.3
Net unrealized appreciation (depreciation) relating to portfolio investments		25.2		(23.4)		(15.1)		(14.6)	(b)		(27.9)
Total net unrealized appreciation (depreciation) relating to portfolio investments	$	25.7	$	(25.4)	$	(9.1)	$	(15.8)		$	(24.6)

(a)	LMM includes unrealized appreciation on 25 LMM portfolio investments and unrealized depreciation on 25 LMM portfolio investments.

(b)

Other includes (i) $14.6 million of unrealized depreciation relating to the External Investment Manager and (ii) $1.2 million of unrealized depreciation relating to the Main Street Capital Corporation Deferred Compensation Plan (see “Related Party Transactions and Agreements” below), partially offset by $1.4 million of net unrealized appreciation relating to the Other Portfolio.

Income Tax Benefit (Provision)

The income tax provision for the three months ended June 30, 2022 of $10.3 million principally consisted of (i) a deferred tax provision of $9.5 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, and (ii) a current tax provision of $0.8 million, related to a $0.7 million provision for excise tax on our estimated undistributed taxable income and a $0.1 million provision for current U.S. federal and state income taxes. The income tax provision for the three months ended June 30, 2021 of $9.7 million principally consisted of (i) a deferred tax provision of $9.0 million, and (ii) a current tax provision of $0.7 million related to a $0.5 million provision for current U.S. federal and state income taxes, and a $0.2 million provision for excise tax on our estimated undistributed taxable income.

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Net Increase in Net Assets Resulting from Operations

The net increase in net assets resulting from operations for the three months ended June 30, 2022 was $14.7 million, or $0.20 per share, compared with $95.1 million, or $1.39 per share, during the three months ended June 30, 2021. The tables above provide a summary of the reasons for the change in net increase in net assets resulting from operations for the three months ended June 30, 2022 as compared to the three months ended June 30, 2021.

Comparison of the six months ended June 30, 2022 and June 30, 2021

Set forth below is a comparison of the results of operations, and a reconciliation of net investment income to distributable net investment income and adjusted distributable net investment income, for the six months ended June 30, 2022 and June 30, 2021, respectively.


	Six Months Ended
	June 30,				Net Change
	2022		2021		Amount		%

	(dollars in thousands)
Total investment income	$	164,596	$	130,102	$	34,494	27	%
Total expenses		(57,657)		(47,954)		(9,703)	20	%
Net investment income		106,939		82,148		24,791	30	%
Net realized gain (loss) from investments		(1,728)		2,270		(3,998)	NM
Net unrealized appreciation (depreciation) from investments		(9,841)		78,440		(88,281)	NM
Income tax benefit (provision)		(15,417)		(10,407)		(5,010)	NM
Net increase in net assets resulting from operations	$	79,953	$	152,451	$	(72,498)	(48)	%


	Six Months Ended
	June 30,				Net Change
	2022		2021		Amount		%

	(dollars in thousands, except per share amounts)
Net investment income	$	106,939	$	82,148	$	24,791	30	%
Share‑based compensation expense		6,414		5,092		1,322	26	%
Distributable net investment income(a)	$	113,353	$	87,240	$	26,113	30	%
Deferred compensation expense (benefit)		(1,601)		728		(2,329)	NM
Adjusted distributable net investment income (b)	$	111,752	$	87,968	$	23,784	27	%
Net investment income per share—Basic and diluted	$	1.47	$	1.20	$	0.27	23	%
Distributable net investment income per share—Basic and diluted (a)	$	1.56	$	1.28	$	0.28	22	%
Adjusted distributable net investment income—Basic and diluted (b)	$	1.54	$	1.29	$	0.25	19	%

NM	Net change % not meaningful

(a)

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(b)

Investment Income

Total investment income for the six months ended June 30, 2022 was $164.6 million, a 27% increase from the $130.1 million of total investment income for the corresponding period of 2021. The following table provides a summary of the changes in the comparable period activity.


	Six Months Ended
	June 30,				Net Change
	2022		2021		Amount		%

		(dollars in thousands)
Interest Income	$	123,426	$	89,416	$	34,010	38	%	(a)
Dividend Income		34,535		36,316		(1,781)	(5)	%	(b)
Fee Income		6,635		4,370		2,265	52	%	(c)
Total Investment Income	$	164,596	$	130,102	$	34,494	27	%	(d)

(a)

(b)

The decrease in dividend income from Investment Portfolio equity investments was primarily a result of a $6.6 million decrease related to dividend income considered to be less consistent or non-recurring, partially offset by continued strong dividend income from a variety of portfolio companies resulting from the improved operating results, financial condition and liquidity positions of certain of our portfolio companies.

(c)	The increase in fee income is primarily related to (i) a $1.2 million increase related to higher originations of Investment Portfolio investments as discussed above and (ii) a $1.0 million increase from refinancing and prepayment of debt investments.

(d)

The increase in total investment income includes a net reduction in the impact of certain income considered less consistent or non-recurring, including a $6.6 million decrease in dividend income, partially offset by a $3.0 million increase in accelerated prepayment, repricing and other activity related to certain Investment Portfolio debt investments.

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Expenses

Total expenses for the six months ended June 30, 2022 were $57.7 million, a 20% increase from the $48.0 million in the corresponding period of 2021. The following table provides a summary of the changes in the comparable period activity.


	Six Months Ended
	June 30,				Net Change
	2022		2021		Amount		%

		(dollars in thousands)
Employee compensation expenses	$	17,576	$	12,238	$	5,338	44	%	(a)
Deferred compensation plan expense (benefit)		(1,500)		978		(2,478)	(253)	%	(b)
Total compensation expense		16,076		13,216		2,860	22	%
G&A expense		7,464		6,392		1,072	17	%
Interest expense		33,982		28,206		5,776	20	%	(c)
Share-based compensation expense		6,414		5,092		1,322	26	%
Gross expenses		63,936		52,906		11,030	21	%
Allocation of expenses to the External Investment Manager		(6,279)		(4,952)		(1,327)	27	%
Total expenses	$	57,657	$	47,954	$	9,703	20	%

(a)	The increase in compensation expense is primarily related to increased headcount, base compensation rates and incentive compensation accruals.

(b)

The change in the non-cash deferred compensation plan expense was due to the comparable period reduction to compensation expense resulting from a decrease in the fair value of deferred compensation plan assets and corresponding liabilities in the first quarter of 2022 compared to an increase in such fair values in the corresponding period of 2021.

(c)	The increase in interest expense was primarily related to increased borrowings to support our investment activity, including an aggregate of $200.0 million in principal amount of our 3.00% Notes issued in October 2021 and greater amounts of borrowings under our Credit Facility.

Net Investment Income

Net investment income for the six months ended June 30, 2022 increased 30% to $106.9 million, or $1.47 per share, compared to net investment income of $82.1 million, or $1.20 per share, for the corresponding period of 2021. The increase in net investment income was principally attributable to the increase in total investment income, partially offset by higher operating expenses, both as discussed above. The increase in net investment income per share reflects these changes and the impact of the increase in weighted average shares outstanding for the six months ended June 30, 2022, primarily due to shares issued through the ATM Program, shares issued pursuant to our equity incentive plans and shares issued pursuant to our dividend reinvestment plan. The increase in net investment income on a per share basis includes (i) a $0.06 per share decrease in investment income considered less consistent or non-recurring and (ii) a decrease in compensation expense of $0.03 per share resulting from the comparable period difference in the fair value of deferred compensation plan assets and corresponding liabilities, both of which are discussed above.

Distributable Net Investment Income

Distributable net investment income for the six months ended June 30, 2022 increased 30% to $113.4 million, or $1.56 per share, compared with $87.2 million, or $1.28 per share, in the corresponding period of 2021. The increase in distributable net investment income was primarily due to the increased level of total investment income, partially offset by higher operating expenses, excluding share-based compensation expense, both as discussed above. The increase in distributable net investment income per share reflects these changes and the net impact of the increase in weighted average shares outstanding for the six months ended June 30, 2022, primarily due to shares issued through the ATM Program, shares issued pursuant to our equity incentive plans and shares issued pursuant to our dividend reinvestment plan. The increase in distributable net investment income on a per share basis includes (i) a $0.06 per share decrease in investment income considered less consistent or non-recurring and (ii) a decrease in compensation expense of $0.03 per

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share resulting from the comparable period difference in the fair value of deferred compensation plan assets and corresponding liabilities, both of which are discussed above.

Adjusted Distributable Net Investment Income

Adjusted distributable net investment income for the six months ended June 30, 2022 increased 27% to $111.8 million, or $1.54 per share, compared with $88.0 million, or $1.29 per share, in the corresponding period of 2021. The increase in adjusted distributable net investment income was primarily due to the increased level of total investment income, partially offset by higher operating expenses, excluding share-based compensation expense and deferred compensation expense (benefit), both as discussed above. The increase in adjusted distributable net investment income per share reflects the net impact of the increase in weighted average shares outstanding for the six months ended June 30, 2022, 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. The increase in distributable net investment income on a per share basis includes a $0.06 per share decrease in investment income considered less consistent or non-recurring, as discussed above.

Net Realized Gain (Loss) from Investments

The following table provides a summary of the primary components of the total net realized loss on investments of $1.7 million for the six months ended June 30, 2022:


	Six Months Ended June 30, 2022
	Full Exits			Partial Exits			Restructures			Other (a)		Total
	Net Gain/(Loss)		# of Investments	Net Gain/(Loss)		# of Investments	Net Gain/(Loss)		# of Investments	Net Gain/(Loss)		Net Gain/(Loss)

	(dollars in thousands)
LMM Portfolio	$	-	-	$	-	-	$	-	-	$	(458)	$	(458)
Private Loan Portfolio		1,560	1		-	-		-	-		185		1,745
Middle Market Portfolio		(6,069)	1		-	-		-	-		-		(6,069)
Other Portfolio		-	-		2,569	2		-	-		441		3,010
Short-term Portfolio		-	-		-	-		-	-		44		44
Total net realized gain/(loss)	$	(4,509)	2	$	2,569	2	$	-	-	$	212	$	(1,728)

(a)	Other activity includes realized gains and losses from transactions involving 10 portfolio companies which are not considered to be significant individually or in the aggregate.

Net Unrealized Appreciation (Depreciation)

The following table provides a summary of the total net unrealized depreciation of $9.8 million for the six months ended June 30, 2022:


	Six Months Ended June 30, 2022
			Private		Middle
	LMM(a)		Loan		Market		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	$	0.9	$	(2.5)	$	6.0	$	(2.9)		$	1.5
Net unrealized appreciation (depreciation) relating to portfolio investments		45.7		(20.4)		(15.7)		(20.9)	(b)		(11.3)
Total net unrealized appreciation (depreciation) relating to portfolio investments	$	46.6	$	(22.9)	$	(9.7)	$	(23.8)		$	(9.8)

(a)	LMM includes unrealized appreciation on 31 LMM portfolio investments and unrealized depreciation on 30 LMM portfolio investments.

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(b)

Other includes (i) $22.1 million of unrealized depreciation relating to the External Investment Manager and (ii) $1.6 million of net unrealized depreciation relating to the Main Street Capital Corporation Deferred Compensation Plan, partially offset by $1.5 million of net unrealized appreciation relating to the Other Portfolio.

Income Tax Benefit (Provision)

The income tax provision for the six months ended June 30, 2022 of $15.4 million principally consisted of (i) a deferred tax provision of $13.3 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 and (ii) a current tax provision of $2.1 million related to a $1.4 million provision for excise tax on our estimated undistributed taxable income and a $0.7 million provision for current U.S. federal and state income taxes. The income tax benefit for the six months ended June 30, 2021 of $10.4 million principally consisted of (i) a deferred tax provision of $9.1 million and (ii) a current tax provision of $1.3 million primarily related to a $0.8 million provision for current U.S. federal and state income taxes and a $0.5 million provision for excise tax in our estimated undistributed taxable income.

Net Increase in Net Assets Resulting from Operations

The net increase in net assets resulting from operations for the six months ended June 30, 2022 was $80.0 million, or $1.10 per share, compared with $152.5 million, or $2.23 per share, during the six months ended June 30, 2021. The tables above provide a summary of the reasons for the change in net increase in net assets resulting from operations for the six months ended June 30, 2022 as compared to the six months ended June 30, 2021.

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 six months ended June 30, 2022, we realized a net increase in cash and cash equivalents of $10.8 million, which is the result of $50.2 million of cash provided by our financing activities, offset by $39.4 million of cash used in our operating activities.

The $39.4 million of cash used in our operating activities resulted primarily from (i) cash uses totaling $540.4 million for the funding of new and follow-on portfolio company investments and settlement of accruals for portfolio investments existing as of December 31, 2021 and (ii) cash payments of $15.0 million related to changes in other assets and liabilities, partially offset by (i) cash proceeds totaling $412.1 million from the sales and repayments of debt investments and sales of and return on capital from equity investments and (ii) cash flows that we generated from the operating profits earned totaling $103.9 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.

The $50.2 million of cash provided by our financing activities principally consisted of (i) $89.2 million in net cash proceeds from our ATM Program (described below) and direct stock purchase plan and (ii) $60.0 million in net proceeds from the Credit Facility, partially offset by (i) $94.1 million in cash dividends paid to stockholders and (ii) $4.9 million for purchases of vested restricted stock from employees to satisfy their tax withholding requirements upon the vesting of such restricted stock.

Capital Resources

As of June 30, 2022, we had $43.4 million in cash and cash equivalents and $475.0 million of unused capacity under the Credit Facility which we maintain to support our investment and operating activities. As of June 30, 2022, our net asset value totaled $1,865.2 million, or $25.37 per share.

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The Credit Facility provides additional liquidity to support our investment and operational activities. As of June 30, 2022, the Credit Facility included total commitments of $855.0 million from a diversified group of 18 lenders, held a maturity date in April 2026 and contained an accordion feature with the right to request an increase in commitments under the facility from new and existing lenders on the same terms and conditions as the existing commitments up to a total of $1.2 billion. As of June 30, 2022, borrowings under the Credit Facility bore 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 plus (i) 1.875% (or the applicable Prime Rate plus 0.875%) as long as we meet certain agreed upon excess collateral and maximum leverage requirements or (ii) 2.0% (or the applicable Prime 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. As of June 30, 2022, the Credit Facility contained certain affirmative and negative covenants, including but not limited to: (i) maintaining minimum liquidity, (ii) maintaining an interest coverage ratio of at least 2.0 to 1.0, (iii) maintaining a 1940 Act asset coverage ratio of at least 1.5 to 1.0, (iv) maintaining a minimum tangible net worth and (v) maintaining a minimum asset coverage ratio of 200% with respect to the consolidated assets (with certain limitations on the contribution of equity in financing subsidiaries as specified therein) of MSCC and the guarantors under the Credit Facility to the secured debt of MSCC and the guarantors. As of June 30, 2022, we had $380.0 million in borrowings outstanding under the Credit Facility, the interest rate on the Credit Facility was 2.9% 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 $350.0 million of outstanding SBIC debentures guaranteed by the SBA as of June 30, 2022 through our wholly-owned SBICs, which bear a weighted-average annual fixed interest rate of 2.9%, paid semiannually, and mature ten years from issuance. The first maturity related to our SBIC debentures occurs in 2023, and the weighted-average remaining duration is 5.6 years as of June 30, 2022. 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 maintain SBIC debentures under the SBIC program in the future, subject to periodic repayments and borrowings, in an amount up to the regulatory maximum amount for affiliated SBIC funds.

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”) at an issue price of 99.16%. The 4.50% 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 4.50% Notes; 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 may be redeemed in whole or in part at any time at our option subject to certain make-whole provisions. The 4.50% Notes 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 the 4.50% Notes in accordance with the 1940 Act and the rules promulgated thereunder. As of June 30, 2022, the outstanding principal balance of the 4.50% Notes was $185.0 million.

The indenture governing the 4.50% Notes (the “4.50% 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 4.50% 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 4.50% Notes Indenture. As of June 30, 2022, we were in compliance with these covenants.

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 in aggregate principal amount of the 5.20% Notes at an issue price of 105.0%. Also, in July 2020, we issued an additional $125.0 million in aggregate principal amount of the 5.20% Notes at an issue price of 102.674%. The

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5.20% Notes issued in December 2019 and July 2020 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 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. 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. We may from time to time repurchase the 5.20% Notes in accordance with the 1940 Act and the rules promulgated thereunder. As of June 30, 2022, the outstanding principal balance of the 5.20% Notes was $450.0 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. As of June 30, 2022, we were in compliance with these covenants.

In January 2021, we issued $300.0 million in aggregate principal amount of 3.00% unsecured notes due July 14, 2026 (the “3.00% Notes”) at an issue price of 99.004%. In October 2021, we issued an additional $200.0 million in aggregate principal amount of the 3.00% Notes at an issue price of 101.741%. The 3.00% Notes issued in October 2021 have identical terms as, and are a part of a single series with, the 3.00% Notes issued in January 2021. The 3.00% 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 3.00% Notes; 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 3.00% Notes may be redeemed in whole or in part at any time at our option subject to certain make whole provisions. The 3.00% Notes bear interest at a rate of 3.00% per year payable semiannually on January 14 and July 14 of each year. We may from time to time repurchase the 3.00% Notes in accordance with the 1940 Act and the rules promulgated thereunder. As of June 30, 2022, the outstanding principal balance of the 3.00% Notes was $500.0 million.

The indenture governing the 3.00% Notes (the “3.00% 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 3.00% 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 3.00% Notes Indenture. As of June 30, 2022, we were in compliance with these covenants.

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 six months ended June 30, 2022, we sold 2,159,117 shares of our common stock at a weighted-average price of $41.71 per share and raised $90.1 million of gross proceeds under the ATM Program. Net proceeds were $88.9 million after commissions to the selling agents on shares sold and offering costs. As of June 30, 2022, sales transactions representing 61,757 shares had not settled and are not included in shares issued and outstanding on the face of the Consolidated Balance Sheets but are included in the weighted average shares outstanding in the Consolidated Statement of Operations and in the shares used to calculate the net asset value per share. In March 2022, we entered into new distribution agreements to sell up to 15,000,000 shares through the ATM Program. As of June 30, 2022, 13,710,949 shares remained available for sale under the ATM Program.

During the year ended December 31, 2021, we sold 2,332,795 shares of our common stock at a weighted-average price of $42.71 per share and raised $99.6 million of gross proceeds under the ATM Program. Net proceeds were $98.4 million after commissions to the selling agents on shares sold and offering costs. As of December 31, 2021, sales transactions representing 36,136 shares had not settled and are not included in shares issued and

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outstanding on the face of the Consolidated Balance Sheets but are included in the weighted average shares outstanding in the Consolidated Statement of Operations and in the shares used to calculate the net asset value per share.

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, Private Loan and Middle Market 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. We may also invest in short-term portfolio investments that are atypical of our LMM, Private Loan and Middle Market portfolio investments in that they are intended to be a short-term deployment of capital and are more liquid than investments within the other portfolios. Short-term portfolio investments consist primarily of investments in secured debt investments and independently rated debt 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 2022 annual meeting of stockholders, and have not sought such authorization since 2012, 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, or BDC asset coverage ratio, of total assets to total senior securities, which include borrowings and any preferred stock we may issue in the future, of at least 200% (or 150% if certain requirements are met). In January 2008, we received an exemptive order from the SEC to exclude SBA-guaranteed debt securities issued by the Funds and any other wholly-owned subsidiaries of ours which operate as SBICs from the BDC asset coverage ratio which, in turn, enables us to fund more investments with debt capital. In May 2022, our stockholders also approved the application of the reduced BDC asset coverage ratio. As a result, the BDC asset coverage ratio applicable to us decreased from 200% to 150% effective May 3, 2022. As of June 30, 2022, our BDC asset coverage ratio was 223%.

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

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. For a description of recently issued or adopted accounting standards, see Note B.13 – Recently Issued or Adopted Accounting Standards included in Item 1. Consolidated Financial Statements of this Quarterly Report on Form 10-Q.

Inflation

Inflation has not historically had a significant effect on our results of operations in any of the reporting periods presented herein. However, our portfolio companies have experienced, specifically including over the last few quarters as a result of the COVID-19 pandemic, recent geopolitical events and the related supply chain and labor issues, and may continue to experience, the increasing 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. These issues and

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challenges related to inflation are receiving significant attention from our investment teams and the management teams of our portfolio companies as we work to manage these growing challenges. Prolonged or more severe impacts of inflation to our portfolio companies could continue to impact their operating profits and, thereby, increase their borrowing costs, and as a result negatively impact their ability to service their debt obligations and/or reduce their available cash for distributions. In addition, these factors could have a negative impact on the fair value of our investments in these portfolio companies. The combined impacts of these impacts in turn could negatively affect our results of operations.

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 June 30, 2022, we had a total of $263.6 million in outstanding commitments comprised of (i) 74 investments with commitments to fund revolving loans that had not been fully drawn or term loans with additional commitments not yet funded and (ii) 10 investments with equity capital commitments that had not been fully called.

Contractual Obligations

As of June 30, 2022, the future fixed commitments for cash payments in connection with our SBIC debentures, the 4.50% Notes, the 5.20% Notes, the 3.00% Notes and rent obligations under our office lease for each of the next five years and thereafter are as follows (dollars in thousands):


	2022		2023		2024		2025		2026		Thereafter		Total
3.00% Notes due 2026	$	—	$	—	$	—	$	—	$	500,000	$	—	$	500,000
Interest due on 3.00% Notes due 2026		7,517		15,000		15,000		15,000		15,000		—		67,517
5.20% Notes due 2024		—		—		450,000		—		—		—		450,000
Interest due on 5.20% Notes due 2024		11,700		23,400		11,700		—		—		—		46,800
SBIC debentures		—		16,000		63,800		—		—		270,200		350,000
Interest due on SBIC debentures		5,166		9,899		8,455		7,228		7,228		15,565		53,541
4.50% Notes due 2022		185,000		—		—		—		—		—		185,000
Interest due on 4.50% Notes due 2022		4,163		—		—		—		—		—		4,163
Operating Lease Obligation (1)		395		804		818		832		846		933		4,628
Total	$	213,941	$	65,103	$	549,773	$	23,060	$	523,074	$	286,698	$	1,661,649

(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 June 30, 2022, we had $380.0 million in borrowings outstanding under our Credit Facility, and the Credit Facility is scheduled to mature in April 2026.

Related Party Transactions and Agreements

As discussed further above, the External Investment Manager is treated as a wholly-owned portfolio company of ours and is included as part of our Investment Portfolio. At June 30, 2022, we had a receivable of $6.3 million due from the External Investment Manager, which included $4.5 million related primarily 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 us under a tax sharing agreement (see further discussion in Note B.9—Summary of Significant Accounting Policies—Income Taxes and Note D – External Investment Manager included in Item 1. Consolidated Financial Statements of this Quarterly Report on Form 10-Q) and $1.7 million of dividends declared but not paid by the External Investment Manager. We have entered into an agreement with the External Investment Manager to share employees in

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connection with its asset management business generally, and specifically for the External Investment Manager’s relationship with MSC Income and its other clients. See Note A.1—Organization and Basis of Presentation—Organization and Note D – External Investment Manager included in Item 1. Consolidated Financial Statements of this Quarterly Report on Form 10-Q for more information regarding the External Investment Manager.

From time to time, we may make investments in clients of the External Investment Manager in the form of debt or equity capital on terms approved by our Board of Directors. In January 2021, we entered into a Term Loan Agreement with MSC Income (the “Term Loan Agreement”). The Term Loan Agreement was unanimously approved by our Board of Directors, including each director who is not an “interested person,” as such term is defined in Section 2(a)(19) of the 1940 Act and the board of directors of MSC Income, including each director who is not an “interested person” of MSC Income or the External Investment Manager. The Term Loan Agreement initially provided for a term loan of $40.0 million to MSC Income, bearing interest at a fixed rate of 5.00% per annum, and maturing in January 2026. The Term Loan Agreement was amended in July 2021 to provide for borrowings up to an additional $35.0 million, $20.0 million of which was funded upon signing of the amendment and $15.0 million available in two additional advances during the six months following the amendment date. Borrowings under the Term Loan Agreement were expressly subordinated and junior in right of payment to all secured indebtedness of MSC Income. In October 2021, MSC Income fully repaid all borrowings outstanding under the Term Loan Agreement and the Term Loan Agreement was extinguished.

In May 2022, we purchased 94,697 shares of common stock of MSC Income totaling $750,000 from MSC Income at the price shares were purchased by MSC Income stockholders pursuant to MSC Income’s dividend reinvestment plan for its May dividend on such date. Our purchase of MSC Income common stock was unanimously approved by the Board of Directors and MSC Income’s board of directors, including each director who is not an “interested person,” as such term is defined in Section 2(a)(19) of the 1940 Act, of each board. As of June 30, 2022, we owned 94,697 shares of MSC Income. In addition, certain of our officers and employees own shares of MSC Income and therefore have direct pecuniary interests in MSC Income.

In December 2020, the External Investment Manager entered into an Investment Management Agreement with the Private Loan Fund, pursuant to which the External Investment Manager provides investment advisory and management services to the Private Loan Fund in exchange for an asset-based fee and certain incentive fees. The Private Loan Fund is a private investment fund exempt from registration under the 1940 Act that co-invests with Main Street in Main Street’s Private Loan investment strategy. In connection with the Private Loan Fund’s initial closing in December 2020, we committed to contribute up to $10.0 million as a limited partner and will be entitled to distributions on such interest. In February 2022, Main Street increased its total commitment to the Private Loan Fund from $10.0 million to $15.0 million. In addition, certain of our officers and employees (and certain of their immediate family members) have made capital commitments to the Private Loan Fund as limited partners and therefore have direct pecuniary interests in the Private Loan Fund. As of June 30, 2022, we have funded $11.3 million of our limited partner commitment and our unfunded commitment was $3.7 million. Our limited partner commitment to the Private Loan Fund was unanimously approved by our Board of Directors, including each director who is not an “interested person,” as such term is defined in Section 2(a)(19) of the 1940 Act.

Additionally, we provided the Private Loan Fund with a revolving line of credit pursuant to an Unsecured Revolving Promissory Note, dated February 5, 2021 and was subsequently amended on November 30, 2021 and on December 29, 2021 (as amended, the “PL Fund 2021 Note”), in an aggregate amount equal to the amount of limited partner capital commitments to the Private Loan Fund up to $85.0 million. Borrowings under the PL Fund 2021 Note bore interest at a fixed rate of 5.00% per annum and matured on February 28, 2022. The PL Fund 2021 Note was unanimously approved by our Board of Directors, including each director who is not an “interested person,” as such term is defined in Section 2(a)(19) of the 1940 Act. In February 2022, the Private Loan Fund fully repaid all borrowings outstanding under the PL Fund 2021 Note and the PL Fund 2021 Note was extinguished.

In March 2022, we provided the Private Loan Fund with a new revolving line of credit pursuant to a Secured Revolving Promissory Note, dated March 17, 2022 (the “PL Fund 2022 Note”), which provides for borrowings up to $10.0 million. Borrowings under the PL Fund 2022 Note bear interest at a fixed rate of 5.00% per annum and mature on the date upon which the Private Loan Fund’s investment period concludes, which is scheduled to occur in March 2026. Available borrowings under the PL Fund 2022 Note are subject to a 0.25% non-use fee. The PL Fund 2022 Note was unanimously approved by our Board of Directors, including each director who is not an “interested person,” as such term

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is defined in Section 2(a)(19) of the 1940 Act. As of June 30, 2022, there were no borrowings outstanding under the PL Fund 2022 Note.

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, 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 June 30, 2022, $14.9 million of compensation, plus net unrealized gains and losses and investment income and minus distributions had been deferred under the 2015 Deferred Compensation Plan (including amounts previously deferred under the 2013 Deferred Compensation Plan). Of this amount, $6.1 million had been deferred into phantom Main Street stock units, representing 158,865 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 the deferred fees represented by such phantom stock units are earned over the service period. The dividend amounts related to additional phantom stock units are included in the Consolidated Statements of Changes in Net Assets as an increase to dividends to stockholders offset by a corresponding increase to additional paid-in capital.

Recent Developments

In August 2022, we declared a supplemental cash dividend of $0.10 per share payable in September 2022. This supplemental cash dividend is in addition to the previously announced regular monthly cash dividends that we declared for the third quarter of 2022 of $0.215 per share for each of July, August and September 2022 or total monthly cash dividends of $0.645 per share for the quarter.

In August 2022, we declared regular monthly dividends of $0.22 per share for each of October, November and December of 2022. These regular monthly dividends equal a total of $0.66 per share for the fourth quarter of 2022, representing a 4.8% increase from the regular monthly dividends paid in the fourth quarter of 2021. Including the regular monthly and supplemental dividends declared for the third and fourth quarters of 2022 we will have paid $35.02 per share in cumulative dividends since our October 2007 initial public offering.

During August 2022, we amended our Credit Facility to, among other changes, (i) increase the revolving commitments by lenders to $920.0 million, and with the right to request an increase in commitments under the Credit Facility from new and existing lenders on the same terms and conditions as the existing commitments up to a total of $1.4 billion, subject to certain conditions, (ii) extend the revolving period under the Credit Facility to August 4, 2026 and the final maturity date of the Credit Facility to August 4, 2027, (iii) transition the reference rate used to determine the borrowing interest rate from LIBOR to Term SOFR (“SOFR”) plus an applicable credit spread adjustment, while maintaining the interest rate spread of 1.875%.

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, SOFR and prime rates, to the extent that any debt investments include floating interest rates. See “Risk Factors—Risks Related to our Investments — Changes relating to the LIBOR calculation process, the phase-out of LIBOR and the use of replacement rates for LIBOR may adversely affect the value of our portfolio securities.”, “Risk Factors — Risks Related to our Investments — We are subject to risks associated with the current interest rate environment and changes in interest rates will affect our cost of capital, net investment

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income and the value of our investments.” and “Risk Factors — Risks Related to Leverage — Because we borrow money, the potential for gain or loss on amounts invested in us is magnified and may increase the risk of investing in us.” included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021 for more information regarding risks associated with our debt investments and borrowings that utilize LIBOR, SOFR or Prime 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 June 30, 2022, 75% of our debt investment portfolio (at cost) bore interest at floating rates, 94% of which were subject to contractual minimum interest rates. Our interest expense will be affected by changes in the published LIBOR (or after August 4, 2022, SOFR) rate in connection with our Credit Facility; however, the interest rates on our outstanding SBIC debentures, 4.50% Notes, 5.20% Notes and 3.00% Notes, which collectively comprise the majority of our outstanding debt, are fixed for the life of such debt. As of June 30, 2022, 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 June 30, 2022.


	Increase		(Increase)		Increase		Increase
	(Decrease)		Decrease		(Decrease) in Net		(Decrease) in Net
	in Interest		in Interest		Investment		Investment
Basis Point Change	Income		Expense		Income		Income per Share

	(dollars in thousands, except per share amounts)
(150)	$	(23,680)	$	4,066	$	(19,614)	$	(0.27)
(100)		(19,055)		3,800		(15,255)		(0.21)
(50)		(10,404)		1,900		(8,504)		(0.12)
(25)		(5,395)		950		(4,445)		(0.06)
25		4,938		(950)		3,988		0.05
50		10,206		(1,900)		8,306		0.11
75		15,475		(2,850)		12,625		0.17
100		20,745		(3,800)		16,945		0.23
125		26,014		(4,750)		21,264		0.29
150		31,283		(5,700)		25,583		0.35

The hypothetical results assume that all LIBOR, SOFR and prime rate changes would be effective on the first day of the period. However, the contractual LIBOR, SOFR 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 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 June 30, 2022 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

In addition to the other information set forth in this report, you should carefully consider the risk factors described in Part I, “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021 that we filed with the SEC on February 25, 2022, which could materially affect our business, financial condition and/or operating results. There have been no material changes to the risk factors as previously disclosed in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021.

The risks described in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021 are not the only risks facing us. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially and adversely affect our business, financial condition and/or operating results.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

During the three months ended June 30, 2022, we issued 132,156 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 stock issued during the three months ended June 30, 2022 under the dividend reinvestment plan was $5.0 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).

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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		Third Amendment, dated as of August 4, 2022, to the Third Amended and Restated Credit Agreement by and among Main Street, the guarantors party thereto, Truist Bank, as administrative agent, and the lenders party thereto (previously filed as Exhibit 10.1 to Main Street Capital Corporation’s Current Report on Form 8-K filed on August 4, 2022 (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
	/s/ DWAYNE L. HYZAK
Date: August 5, 2022	Dwayne L. Hyzak
	Chief Executive Officer
	(principal executive officer)
	/s/ JESSE E. MORRIS
Date: August 5, 2022	Jesse E. Morris
	Chief Financial Officer and Chief Operating Officer
	(principal financial officer)
	/s/ LANCE A. PARKER
Date: August 5, 2022	Lance A. Parker
	Vice President and Chief Accounting Officer
	(principal accounting officer)

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