UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): January 7, 2010
Main Street Capital Corporation
(Exact name of registrant as specified in its charter)
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| Maryland
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1-33723
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41-2230745 |
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(State or other jurisdiction
of incorporation)
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(Commission File Number)
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(IRS Employer Identification No.) |
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1300 Post Oak Boulevard, Suite 800,
Houston, Texas
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77056 |
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(Zip Code) |
Registrant’s telephone number, including area code: (713) 350-6000
Not Applicable
(Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.01 Completion of Acquisition or Disposition of Assets.
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Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet
Arrangement of a Registrant. |
Item 3.02 Unregistered Sales of Equity Securities.
On January 7, 2010, Main Street Capital Corporation (“Main Street”) consummated the
transactions related to its formal offer to exchange (the “Exchange Offer”) shares of its common
stock for at least a majority of the limited partner interests in Main Street Capital II, LP, a
Delaware limited partnership (“MSC II”). The commencement of the Exchange Offer was previously
disclosed on a Form 8-K filed by Main Street with the Securities and Exchange Commission on
September 23, 2009. The Exchange Offer was applicable to all MSC II limited partner interests
except for any limited partner interests owned by affiliates of Main Street, including any limited
partner interests owned by officers or directors of Main Street. The Exchange Offer was formally
approved by the U.S. Small Business Administration (the “SBA”) prior to closing. At the closing of
the Exchange Offer, approximately 88% of the total dollar value of MSC II limited partner interests
were validly exchanged for 1,239,695 shares of Main Street common stock (the “Shares”). The Shares
are not registered under the Securities Act of 1933, as amended (the “Securities Act”), or any
state securities laws and are also subject to a one-year contractual lock-up from the Exchange
Offer closing date. The Shares were issued under the exemption provided by Section 4(2) under the
Securities Act, Regulation D promulgated thereunder and other similar exceptions under the laws of
the states and jurisdictions where the Exchange Offer was made. A 12% minority ownership in the
total dollar value of the MSC II limited partnership interests remains outstanding, including
approximately 5% owned by affiliates of Main Street. Pursuant to the terms of the Exchange Offer,
100% of the membership interests in the general partner of MSC II (the “General Partner”) were also
transferred to Main Street for no consideration.
MSC II is an investment fund that operates as a Small Business Investment Company (“SBIC”) and
commenced operations in January 2006. MSC II has similar investment strategies to Main Street and
is managed by Main Street pursuant to a separate investment advisory services agreement. In
addition, most of the current MSC II portfolio investments have represented co-investments with
Main Street and/or Main Street’s wholly owned SBIC subsidiary.
MSC II currently has $70 million of SBIC debentures outstanding, which are guaranteed by the
SBA and carry an average fixed interest rate of approximately 6%. SBIC debentures have fixed
interest rates that approximate prevailing 10-year Treasury Note rates when issued plus a
market-determined spread. SBIC debentures are non-recourse and have a maturity of ten years from
issuance. Until maturity, SBIC debentures are interest only with interest payable semi-annually.
The principal amount of the debentures is not required to be paid before maturity but may be
pre-paid at any time. The first principal maturity related to MSC II’s SBIC debentures does not
occur until 2016.
Consummation of the Exchange Offer provides Main Street with access to additional long-term,
low-cost leverage capacity through the SBIC program. The American Recovery and Reinvestment Act of
2009 enacted in February 2009 (the “Stimulus Bill”) increased the maximum amount of combined SBIC
leverage (or SBIC leverage cap) to $225 million for affiliated SBIC funds from the previous SBIC
leverage cap of approximately $137 million as adjusted annually based on the Consumer Price Index.
Since the increase in the SBIC leverage cap applies to affiliated SBIC funds, Main Street is
required to allocate such increased borrowing capacity between its wholly owned SBIC subsidiary and
MSC II. Subsequent to the Exchange Offer, Main Street will have access to an incremental $90
million in SBIC leverage capacity, subject to the required capitalization of each fund, in addition
to the $70 million of existing MSC II SBIC leverage and the $65 million of SBIC leverage at Main
Street’s wholly owned
SBIC subsidiary. At the closing of the Exchange Offer, Main Street funded approximately $24
million in unfunded limited partner commitments for the limited partner interests it acquired in
connection with the Exchange Offer in order to comply with SBA regulatory requirements, which was
funded by Main Street in part with approximately $12 million drawn down under its $30 million,
three-year investment credit facility.
A copy of the press release issued in connection with the announcement of the consummation of
the Exchange Offer is furnished as Exhibit 99.1 hereto and is incorporated herein by reference.
The above summary regarding the MSC II SBIC debentures is not complete and is qualified in its
entirety to the full text of the MSC II SBIC debentures.
An updated version of our Third Quarter 2009 Investor Presentation, including pro forma
information for the Exchange Offer and related transactions, has been posted on the investor
relations section of our web site at www.mainstcapital.com.
Item 9.01. Financial Statements and Exhibits.
(a) Financial statements of businesses acquired.
The following financial statements of MSC II are furnished as Exhibit 99.2 hereto and
incorporated by reference herein:
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Combined balance sheets as of September 30, 2009 (unaudited) and December 31,
2008 and 2007 (audited). |
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Combined statements of operations for the nine months ended September 30, 2009
and 2008 (unaudited) and for the years ended December 31, 2008 and 2007 (audited). |
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Combined statements of changes in members’ equity and partners’ capital for the
nine months ended September 30, 2009 (unaudited) and for the years ended December 31,
2008 and 2007 (audited). |
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Combined statements of cash flows for the nine months ended September 30, 2009
and 2008 (unaudited) and for the years ended December 31, 2008 and 2007 (audited). |
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Combined schedules of investments as of September 30, 2009 (unaudited) and
December 31, 2008 and 2007 (audited). |
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Notes to combined financial statements. |
(b) Pro forma financial information.
The following pro forma financial information is furnished as Exhibit 99.3 hereto and
incorporated by reference herein:
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(1) |
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Unaudited pro forma condensed combined balance sheet as of September 30, 2009. |
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Unaudited pro forma condensed combined income statement for the year ended
December 31, 2008. |
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(3) |
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Unaudited pro forma condensed combined income statement for the nine months
ended September 30, 2009. |
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(4) |
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Unaudited pro forma combined schedule of core portfolio investments as of September 30, 2009. |
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Notes to pro forma condensed combined financial statements. |