SEC Company Response from Main Street Capital (MAIN) — Jul 16, 2015
Main Street Capital CORP
Date: July 16, 2015 · CIK: 0001396440 · Accession: 0001104659-15-051381
AI Filing Summary & Sentiment
File numbers found in text: 333-203147
Letter
Washington, DC 20549 Re: Main Street Capital Corporation Registration Statement on Form N-2 (File Number: 333-203147)
Dear Mr. O’Connor:
On behalf of Main Street Capital Corporation (the “Company”), set forth below is the Company’s response to the oral comment received from the staff of the Division of Investment Management (the “Staff”) of the Securities and Exchange Commission on July 6, 2015 relating to the above-referenced Form N-2 registration statement. The Staff’s comment is set forth below and followed by the Company’s response.
Comment: We are currently reviewing whether various types of unfunded commitments issued by business development companies should be treated as “senior securities” for purposes of Section 18 of the Investment Company Act of 1940, as amended (the “1940 Act”). Prior to any final determination by us with respect thereto, we request that the Company confirm that it (1) has sufficient cash and/or liquid assets to cover the amount of unfunded commitments that are currently outstanding and (2) will not sell additional shares of its common stock unless it has sufficient cash and/or liquid assets to cover the amount of unfunded commitments that are outstanding at the time of any such issuance or sale.
As an alternative to the foregoing, the Company may elect to treat its unfunded commitments as “senior securities” for purposes of Section 18 of the 1940 Act. In the event that the Company selects this alternative, please confirm to us that the Company is currently in compliance with the asset coverage requirement contained in Section 18 of the 1940 Act (the “Asset Coverage Requirement”) and will be in compliance therewith when it issues or sells shares of its common stock.
Finally, please provide us with quantitative support of the Company’s compliance with the selected alternative with respect to the Company’s currently outstanding unfunded commitments
Mr. James E. O’Connor
U.S. Securities and Exchange Commission
July 16, 2015
Page 2
and, if alternative 1 above has been selected by the Company, specifically identify to us the cash and/or liquid assets being used to cover the Company’s currently outstanding unfunded commitments.
Response: The Company hereby confirms that it (1) has elected to treat its unfunded commitments as “senior securities” for the purposes of Section 18 of the 1940 Act and is currently in compliance with the Asset Coverage Requirement and (2) will not sell additional shares of its common stock unless it is in compliance with the Asset Coverage Requirement immediately after such issuance or sale.
In addition, attached hereto please find the requested quantitative support for the Company’s current compliance with the Asset Coverage Requirement based on the election noted above.
* * * * *
Mr. James E. O’Connor
U.S. Securities and Exchange Commission
July 16, 2015
Page 3
If you have any questions or additional comments concerning the foregoing, please contact the undersigned at (202) 383-0805 or Steven B. Boehm at (202) 383-0176.
Sincerely,
/s/ Harry S. Pangas
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CORRESP 1 filename1.htm SUTHERLAND ASBILL & BRENNAN LLP 700 Sixth Street, NW, Suite 700 Washington, DC 20001-3980 202.383.0100 Fax 202.637.3593 www.sutherland.com HARRY S. PANGAS DIRECT LINE: 202.383.0805 E-mail: harry.pangas@sutherland.com July 16, 2015 Mr. James E. O’Connor Senior Counsel U.S. Securities and Exchange Commission Washington, DC 20549 Re: Main Street Capital Corporation Registration Statement on Form N-2 (File Number: 333-203147) Dear Mr. O’Connor: On behalf of Main Street Capital Corporation (the “Company”), set forth below is the Company’s response to the oral comment received from the staff of the Division of Investment Management (the “Staff”) of the Securities and Exchange Commission on July 6, 2015 relating to the above-referenced Form N-2 registration statement. The Staff’s comment is set forth below and followed by the Company’s response. Comment: We are currently reviewing whether various types of unfunded commitments issued by business development companies should be treated as “senior securities” for purposes of Section 18 of the Investment Company Act of 1940, as amended (the “1940 Act”). Prior to any final determination by us with respect thereto, we request that the Company confirm that it (1) has sufficient cash and/or liquid assets to cover the amount of unfunded commitments that are currently outstanding and (2) will not sell additional shares of its common stock unless it has sufficient cash and/or liquid assets to cover the amount of unfunded commitments that are outstanding at the time of any such issuance or sale. As an alternative to the foregoing, the Company may elect to treat its unfunded commitments as “senior securities” for purposes of Section 18 of the 1940 Act. In the event that the Company selects this alternative, please confirm to us that the Company is currently in compliance with the asset coverage requirement contained in Section 18 of the 1940 Act (the “Asset Coverage Requirement”) and will be in compliance therewith when it issues or sells shares of its common stock. Finally, please provide us with quantitative support of the Company’s compliance with the selected alternative with respect to the Company’s currently outstanding unfunded commitments Mr. James E. O’Connor U.S. Securities and Exchange Commission July 16, 2015 Page 2 and, if alternative 1 above has been selected by the Company, specifically identify to us the cash and/or liquid assets being used to cover the Company’s currently outstanding unfunded commitments. Response: The Company hereby confirms that it (1) has elected to treat its unfunded commitments as “senior securities” for the purposes of Section 18 of the 1940 Act and is currently in compliance with the Asset Coverage Requirement and (2) will not sell additional shares of its common stock unless it is in compliance with the Asset Coverage Requirement immediately after such issuance or sale. In addition, attached hereto please find the requested quantitative support for the Company’s current compliance with the Asset Coverage Requirement based on the election noted above. * * * * * Mr. James E. O’Connor U.S. Securities and Exchange Commission July 16, 2015 Page 3 If you have any questions or additional comments concerning the foregoing, please contact the undersigned at (202) 383-0805 or Steven B. Boehm at (202) 383-0176. Sincerely, /s/ Harry S. Pangas Harry S. Pangas Main Street Capital Corp. Leverage Requirement - Consolidated $000s Actual as of March 31, 2015 Consolidated Assets $ 1,830,969 Less: Liabilities (other than senior debt) (93,792 ) Less: SBIC Debt (reclassed to liabilities by exemptive relief) (225,000 ) Total Assets for Leverage Tests 1,512,177 Senior Debt (excluding SBIC Debt for which exemptive relief has been obtained) 429,810 Add: Unfunded Commitments 153,129 Total Senior Securities for Leverage Tests 582,939 Ratio 2.59 BDC Requirement Greater than 2 to 1