UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549_____________________

FORM 10-K/A(Amendment No. 1)

|þ                                                        |  | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934    
|-------------------------------------------------------- |  | ----------------------------------------------------------------------------------------------
|For the fiscal year ended November 30,
      2011       
|OR                                                      
|o                                                        |  | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934
|For the transition period from __________to
  __________

COMMISSION FILE NUMBER:
001-33292

TORTOISE CAPITAL RESOURCES
CORPORATION(Exact Name of
Registrant as Specified in its Charter)

|Maryland                                                             | 20-3431375                           
|-------------------------------------------------------------------- | -------------------------------------
|(State or Other Jurisdiction of
      Incorporation or Organization) | (IRS Employer Identification
    No.)
|                                                                    
|11550 Ash Street, Suite 300                                          |                                      
|Leawood, Kansas                                                      | 66211                                
|(Address of Principal Executive
      Offices)                       | (Zip
Code)                           

Registrants Telephone
Number, Including Area Code: (913) 981-1020

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

Title of Each
      Class
    
    Name Of Each Exchange On Which
      RegisteredCommon Stock, par
      value
    
    New York Stock
      Exchange$0.001 per
    share


Securities registered
pursuant to Section 12(g) of the Act: None

Indicate by check mark if
the registrant is a well-known seasoned issuer, as defined in Rule 405 of the
Securities Act. Yes oNoþ

Indicate by check mark if
the registrant is not required to file reports pursuant to Section 13 or Section
15(d) of the Act. Yes oNoþ

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. YesþNo o

Indicate by check mark whether the registrant has submitted
electronically and posted on its corporate Web site, if any, every Interactive
Data File required to be submitted and posted pursuant to Rule 405 of Regulation
S-T (§232.405 of this chapter) during the preceding 12 months (or for such
shorter period that the registrant was required to submit and post such files).
Yes oNo o

Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be contained,
to the best of registrants knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. o

Indicate by check mark
whether the registrant is a large accelerated filer, an accelerated filer, a
non-accelerated filer, or a smaller reporting company. See the definitions of
large accelerated filer, accelerated filer, and smaller reporting company
in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer o
    
    Accelerated filerþ
    
    Non-accelerated filer o
    
    Smaller reporting company o(Do not check if a smaller reporting
      company)


Indicate by check mark
whether the registrant is a shell company (as defined in Rule 12b-2 of the Act)
Yes oNoþ

The aggregate market value
of common stock held by non-affiliates of the registrant on May 31, 2011 based
on the closing price on that date of $8.55 on the New York Stock Exchange was
$77,562,171. Common shares held by each executive officer and director and by
each person who owns 10% or more of the outstanding common shares (as determined
by information provided to the registrant) have been excluded in that such
persons may be deemed to be affiliates. This determination of affiliate status
is not necessarily a conclusive determination for other purposes.

As of December 31, 2011,
the registrant had 9,176,889 common shares outstanding.

DOCUMENTS INCORPORATED BY
REFERENCE

Portions of the
registrants Proxy Statement for its 2012 Annual Meeting of Stockholders to be
filed not later than 120 days after the end of the fiscal year covered by this
Annual Report on Form 10-K are incorporated by reference into Part III of this
Form 10-K.

1

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TORTOISE CAPITAL RESOURCES
CORPORATIONFORM 10-K/A

FOR THE FISCAL YEAR ENDED NOVEMBER
30, 2011

Explanatory Note

This Amendment No. 1 to the Annual Report on Form
10-K (the “Amendment”) of Tortoise Capital Resources Corporation (the “Company,” “we”
or “us”) amends the Company’s Annual Report on Form 10-K for the fiscal year ended November 30, 2011 that
was originally filed with the Securities and Exchange Commission (the “Commission”) on February 13, 2012
(the “Original 10-K”). This Amendment is being filed solely to (i) appropriately classify Deferred Tax Benefit
of $557,017, $708,217 and $313,024 for the years ended November 30, 2011, 2010 and 2009, respectively, and move such
amounts from Loss from Operations and into Deferred Tax Expense on the Consolidated Statements of Income in accordance with
Rule 5-03 of Regulation S-X, (ii) to revise the subtotal for Net Cash Provided by Operating Activities for the Year Ended
November 30, 2011 within the Consolidated Statements of Cash Flows of $1,576,222 to reflect the sum of the components of that
subsection of the statement of $2,762,446, (iii) to revise certain condensed financial information of the Company’s
unconsolidated affiliates included in Footnote 6 to the financial statements to describe the dates for which financial
information of unconsolidated affiliates is available and to add detail of operating expenses, net income, current and
noncurrent assets and current and noncurrent liabilities to comply with the requirements of Rule 4-08(g) of Regulation S-X,
and (iv) to revise certain statements regarding the timing of obtaining real estate investment trust (“REIT”)
status. These changes did not impact net income or earnings per share amounts.

In addition, as required by Rule 12b-15 of the Securities
Exchange Act of 1934, new certifications by our principal executive officer and principal financial officer are included herein
as exhibits to this Amendment.

Except as described in this explanatory note, no other
information in the Original Form 10-K has been modified, updated or amended by this Amendment. Accordingly, this Amendment
should be read in conjunction with the Original Form 10-K and the Companys other filings with the SEC. This Amendment
No. 1 consists solely of the preceding cover page, this explanatory note, Part  I (Items  1 and 1A), Part II (Items 5, 6, 7,
8 and 9A), Part IV (Item 15(a)), the signature page and the exhibits identified in Part IV.

|TABLE OF CONTENTS
|-----------------
|PART I           
|Item 1.          
|Item 1A.         
|                 
|PART II          
|Item 5.          
|Item 6.          
|Item 7.          
|Item 8.          
|Item 9A.         
|                 
|PART IV          
|Item
15.         
|Signatures       

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PART I

ITEM 1.
BUSINESSGeneral.

We were organized as a
Maryland corporation on September 8, 2005 and commenced operations on December
8, 2005. We were originally regulated as a business development company (BDC)
under the Investment Company Act of 1940 (the 1940 Act). As authorized by our
shareholders, on September 21, 2011, we withdrew our election to be regulated as
a BDC and we are no longer subject to the regulatory provisions of the 1940
Act.

Our objective is to
provide stockholders with an attractive risk-adjusted total return, with an
emphasis on distributions and distribution growth. We invest primarily in the
U.S. energy infrastructure sector. We historically were limited to investing in
securities of privately-held companies operating in the U.S. energy
infrastructure sector. We believe the U.S. energy infrastructure sector offers
significant opportunities for investment in real property assets. We believe
that we can acquire these assets while also satisfying the income requirements
for qualification as a real estate investment trust (REIT). We believe that
becoming qualified and electing REIT status is in the best interests of our
stockholders because a REIT can provide tax-efficient exposure to the energy
infrastructure sector.

If we qualify for and
elect REIT status in the future, we generally will not pay federal income tax
provided that at least 90 percent of our taxable income is distributed to our
stockholders.

We do not plan to make
additional investments in securities (other than short term, highly liquid
investments to be held pending acquisition of real property assets) and intend
to liquidate our securities portfolio in an orderly manner. As of November 30,
2011, the fair value of our securities portfolio (excluding short-term
investments) totaled $68.9 million. The fair value of the securities remaining
in our portfolio as of November 30, 2011, includes: (i) publicly-traded and
liquid master limited partnership (MLP) equity securities of approximately
$27.0 million and (ii) approximately $41.9 million of other illiquid securities
issued by seven privately-held companies. The publicly traded securities can be
liquidated more readily than the others.

Strategy

We seek to acquire real
property assets from energy infrastructure companies and simultaneously lease
these properties to the seller under long-term triple net leases, defined as a
lease in which the lessee pays rent to the lessor, as well as all taxes,
insurance, and maintenance expenses that arise from the use of the property. We
expect our leases to be configured to include a base lease fee with additional
provisions that enable us to participate in the revenue and/or value of the
underlying energy infrastructure real property asset. These provisions would be
considered a contingent rent or fair value repurchase option upon lease
termination. These sale-leaseback transactions provide the lessee company with a
source of financing that is an alternative to other financing sources such as
corporate borrowing or equity offerings. Our sale-leaseback transactions may
occur in conjunction with acquisitions, recapitalizations, growth projects or
other corporate transactions involving the lessee company. We may act as one of
several sources of financing for these transactions by purchasing real property
from the seller and net leasing it back to the seller or its successor in
interest (the lessee).

Market
Opportunity

We believe the
environment for acquiring energy infrastructure real property assets is
attractive for the following reasons:

- ***Energy infrastructure
  provides essential services, and the stable supply and demand today is
  expected to continue in the future.***We believe energy infrastructure is the backbone
  of modern society. The energy infrastructure sector includes the pipes, wires
  and storage facilities that connect and deliver our most critical resources:
  water, electricity, oil and gas. The demand for these resources is directly
  correlated with population growth, and has a low correlation to market cycles.
  The U.S. is the largest consumer of crude oil and natural gas products, the
  third largest producer of crude oil and the largest producer of natural gas
  products in the world. It is not anticipated that the services provided by
  infrastructure facilities will diminish over time; in fact it is expected to
  grow. U.S. energy consumption is forecasted to grow by 20% from 2009 to the
  year 2035 according to the U.S. Energy Information Administration (EIA),
  Annual Energy Outlook April 2011. The United States has an abundant supply of
  natural gas with enough natural gas to last for approximately 80 to 100 years,
  according to various industry sources. Natural gas provides a means of energy
  independence, as nearly 90% of the natural gas consumed in the United States
  is produced domestically. Demand for natural gas continues to increase as
  environmentally sensitive power generation companies switch to low-cost
  cleaner burning fuels. Natural gas is viewed as a reliable back-up energy
  source to alternative energy (e.g., wind and solar) as it is not dependent on
  weather patterns. Natural gas is the cleanest fossil fuel, with 50% and 30%
  fewer carbon dioxide emissions than coal and oil, respectively, as well as
  lower emissions from sulfur dioxide and other pollutants.

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- ***Investment is needed in U.S. energy
  infrastructure***. Due
  to aging infrastructure, renewable energy requirements and rapid technological
  advances in the methods used to extract oil and natural gas, we believe that
  substantial amounts of capital will be invested in energy infrastructure.
  Investments in the power transmission sector in 2008 were quadruple the
  average investment level throughout the 1990s. The National Energy
  Reliability Council (NERC) projects transmission additions will triple from
  approximately 1,000 miles/year in 2000-2008 to 3,100 miles/year in 2009-2018.
  These investment metrics align with NERCs projections that U.S. peak energy
  demand will grow at a rate of 1.3% per year. According to the Brattle Group,
  this growth translates into $10 billion of annual investments in electric
  transmission alone. In addition, a natural gas market study commissioned in
  2009 by the Interstate Natural Gas Association of America Foundation noted
  that to accommodate the geographical shift of natural gas production from
  mature basins to relatively new areas, it expects a range of investment from
  $133 to $210 billion of new midstream natural gas assets in the U.S. and
  Canada. We believe that the U.S. energy infrastructure sectors high level of
  projected capital expenditures and continuing acquisition and divestiture
  activity provide numerous attractive acquisition
  opportunities.
- We believe there are a number of attractive operating companies with
  capital needs.We believe that there are a number of operating companies in the
  midstream and downstream segments of the U.S. energy infrastructure sector
  with capital expansion plans in which the asset performance will provide
  stable cash flow characteristics similar to those demonstrated by MLPs. We
  believe that these operating companies have assets that represent attractive
  financing opportunities for us. The energy industry is monopolistic, and high
  barriers to entry put the responsibility of development and growth on existing
  operating companies. Decreased federal and state funding for infrastructure
  investment is pushing many operating companies to alternative financing
  options. In addition, we can offer financing for assets that do not qualify
  for inclusion in an MLP, such as renewables and electric power
  transmission.
- There is a large segment of assets in energy infrastructure that
  qualify for being held by a REIT.In 2007, 2009 and 2010 the IRS issued three
  separate private letter rulings that defined certain energy infrastructure
  assets as real estate assets for tax purposes. The qualifying real estate
  assets in the energy infrastructure sector are electric transmission and
  distribution systems, pipeline systems and storage and terminaling systems.
  The private letter rulings treat such assets as qualifying real estate assets
  if the income from these assets is derived from rents on real property. While
  private letter rulings provide insight into the current thinking of the IRS on
  tax issues, such rulings may only be relied upon by the taxpayer to whom
  theywere issued.

Investment
Outlook

If we find sufficient suitable REIT-qualifying investments and satisfy the REIT requirements throughout our
fiscal year, we expect to make an election to be treated as a REIT for tax purposes for that fiscal year by filing a Form 1120-REIT
on or before March 15of the subsequent fiscal year, or such later date to which we have properly extended filing such
income tax return. We do not currently expect that we will be able to elect to be treated as a REIT for tax purposes for the 2012
fiscal year, but also do not expect that our lack of REIT status will hinder our ability to pay distributions on a quarterly basis. The REIT requirements that we must meet are discussed in detail
below, but the principal challenge for us will be meeting the requirement that a
substantial percentage of our assets be REIT-qualifying investments that produce
REIT qualifying income. Our effort to meet that requirement will be accelerated
if: (i) we are able to readily identify appropriate opportunities to liquidate
our securities portfolio, or (ii) we are able to raise capital to fund new
acquisitions. In either event, we will need to have identified and be able to
consummate an adequate number of REIT-qualifying investments meeting our
investment criteria. Subject to certain limitations, we may be able to
accelerate satisfying the REIT requirements by holding non-REIT qualifying
investments, including certain private equity investments, through taxable REIT
subsidiaries. We do not currently have any agreements or binding letters of
intent for such investments. These opportunities are in a preliminary stage of
review, and consummation of any of these opportunities depends on a number of
factors beyond our control. There can be no assurance that any of these
acquisition opportunities will result in consummated transactions. Regardless of
our tax status, an investment in us will not result in Unrelated Business
Taxable Income (UBTI).

Our
Investments

We pursue our investment
objective by investing principally in the energy infrastructure sector. The
energy infrastructure sector broadly includes midstream, downstream and upstream
assets. We intend to focus primarily on midstream and downstream assets as
described below.

- Midstream the
  gathering, processing, storing and transmission of energy resources and their
  byproducts in a form that is usable by wholesale power generation, utility,
  petrochemical, industrial and gasoline customers, including pipelines, gas
  processing plants, liquefied natural gas facilities and other energy
  infrastructure companies.
- Downstream the refining of energy sources, and the
  marketing and distribution of such refined products, such as customer-ready
  natural gas, natural gas liquids, propane and gasoline, to end-user customers,
  and the generation, transmission and distribution of electricity, including
  from coal, nuclear, natural gas, agricultural, thermal, solar, wind and
  biomass.

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Targeted Investment
Characteristics

We anticipate that our
targeted real property asset acquisitions will have the following
characteristics:

- *Long-Life Assets with Stable Cash Flows and Limited Commodity Price
  Sensitivity.*We will seek real
  property assets having the potential to generate stable cash flows over long
  periods of time. We have historically invested in companies that own and
  operate assets with long useful lives and that generate cash flows by
  providing critical services primarily to the producers or end-users of energy.
  We have attempted to limit the direct exposure to energy commodity price risk
  in our portfolio. We have targeted companies that have a majority of their
  cash flows generated by contractual obligations. Our planned acquisitions of
  real property assets will continue to reflect these characteristics. Acquired
  real property assets will be long-lived. (In most cases, we expect the term of
  the lease will approximate the projected asset life.) We anticipate our real
  property assets will generate contracted cash flows with third party entities
  over the term of the investment, thus providing stable cash flows underlying
  our leases.
- Experienced Management Teams with Energy Infrastructure Focus.We have targeted assets
  operated by management teams that have a track record of success and that
  often have substantial knowledge and focus in particular segments of the
  energy infrastructure sector or with certain types of assets. We expect that
  our management teams extensive experience and network of business
  relationships in the energy infrastructure sector will allow us to identify
  and attract opportunities to acquire real property assets that meet these
  criteria.
- Fixed Asset-Intensive Investments.Most of our investments have been made in
  companies with a relatively significant base of fixed assets. As we directly
  acquire infrastructure real property assets, our portfolio will reflect the
  nature of fixed-asset investments. Fixed-asset investments characteristically
  display such attributes as long-term stability, low volatility,
  diversification via low correlation and relatively inelastic
  demand.
- Limited Technological Risk.We generally do not target acquisition
  opportunities involving the application of new technologies or significant
  geological, drilling or development risk.
- Growth Opportunities.We generally will seek to enter into leases that provide base rent and
  participating rent over the term of the lease. These increases are expected to
  be fixed or tied generally to increases in indices such as the Consumer Price
  Index (CPI). We may also attempt to obtain equity enhancements in connection
  with transactions. These equity enhancements may involve warrants exercisable
  at a future time to purchase stock of the tenant or borrower or their
  parent.

Investments, Assets and
Wholly-owned Subsidiary

Lightfoot Capital Partners, LP and Lightfoot Capital Partners GP LLC
(Lightfoot)

Lightfoot owns controlling interest in Arc Terminals, a limited
partnership that operates 11 refined product storage terminals located
throughout the United States with a combined working capacity of approximately
3.6 million barrels. Arc provides storage and delivery services for petroleum,
petrochemical and chemical products to customers under long-term storage and
throughput contracts. In October 2011, Lightfoot acquired a minority interest in
a liquefied natural gas regasification facility located in
Mississippi.

Eastern Interconnect Project (EIP)

The EIP project is a 40 percent undivided interest in a 216 mile,
345-KV bulk power transmission line (Line) and related equipment and
substations including towers, easement rights, converters and other grid support
components. These transmission assets move electric power across New Mexico
between Albuquerque and Clovis. The project is leased on a triple net basis
through April 1, 2015 to Public Service Company of New Mexico (PNM), at which
time the lease can be extended, or allowed to expire. PNM is an independent
electric utility company serving approximately 500,000 customers in New Mexico.
PNM is a subsidiary of PNM Resources. EIP is a critical, East-West link on the
Public Service Company of New Mexico transmission grid. Construction of the Line
was completed in 1984 and is expected to have an additional twenty years of
useful life. The Company does not anticipate any material costs would be
incurred should the lease tenant be replaced.

VantaCore Partners LP (VantaCore)

VantaCore was formed to acquire companies in the aggregate industry
and currently owns a quarry and asphalt plant in Clarksville, Tennessee, sand
and gravel operations located near Baton Rouge, Louisiana and a quarry in Todd
County, Kentucky. Aggregates consist of crushed stone, sand and gravel used in
construction and concrete. The company also controls several hundred acres of
land adjacent to its Clarksville location which recently received zoning
approval for a port on the Cumberland River.

High
Sierra Energy, LP and High Sierra Energy, GP (High Sierra)

High Sierra is a Denver based private limited partnership that
operates midstream businesses in the energy industry. Its four business units
include: transportation, treatment, recycling and disposal of oil and gas
waste-water; gathering, transportation,

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logistics and marketing of crude oil; transportation logistics and
marketing of natural gas liquids and asphalt; and leasing of well head
compression equipment. The companys assets are located in nine of the most
prolific oil and natural gas shale plays in the country and have sales in all
lower 48 U.S. states and Canada.

Mowood, LLC (Mowood)  Wholly Owned Subsidiary

Mowood is the holding company of Omega Pipeline, LLC (Omega). Omega
is a natural gas local distribution company located on the Fort Leonard Wood
military installation in south-central Missouri. Omega owns approximately 50
miles of pipeline, has a long term contract with the Department of Defense and
serves the natural gas needs of Fort Leonard Wood in addition to marketing
natural gas services to several customers in the surrounding area. We hold 100
percent of the equity interests in Mowood.

Investment Strategies and Due
Diligence

In analyzing potential
real property acquisitions, we intend to review all aspects of a transaction,
including tenant and asset fundamentals, to determine whether a potential
acquisition and lease can be structured to satisfy our investment criteria. In
evaluating net lease transactions, we generally consider, among other things,
the following aspects of each transaction:

- Tenant/Borrower Evaluation We evaluate each potential tenant or borrower for its
  creditworthiness, typically considering factors such as management experience,
  industry position and fundamentals, operating history, and capital structure,
  as well as other factors that may be relevant to a particular acquisition. We
  seek opportunities in which we believe the tenant may have a stable or
  improving credit profile or credit potential that has not been recognized by
  the market. In evaluating a possible investment, the creditworthiness of a
  tenant or borrower often will be a more significant factor than the value of
  the underlying real estate, particularly if the underlying property is
  specifically suited to the needs of the tenant; however, in certain
  circumstances where the real estate is attractively valued, the
  creditworthiness of the tenant may be a secondary consideration. Whether a
  prospective tenant or borrower is creditworthy will be determined by our
  investment department and reviewed by the investment committee, as described
  below. Creditworthy does not necessarily mean investment
  grade.
- Important to Tenant/Borrower Operations We generally will focus on properties that
  we believe are essential or important to the ongoing operations of the tenant.
  We believe that these properties provide better protection generally as well
  as in the event of a bankruptcy, since a tenant/borrower is less likely to
  risk the loss of a critically important lease or property in a bankruptcy
  proceeding or otherwise.
- Diversification We attempt to diversify our portfolio to avoid dependence on any
  one particular tenant, borrower, collateral type, and geographic location
  within the U.S. or tenant/borrower industry. By diversifying, we seek to
  reduce the adverse effect of a single under-performing investment or a
  downturn in any particular asset or geographic region within the
  U.S.
- Lease Terms
  Generally, the net leased properties we will acquire will be leased on a full
  recourse basis to the tenants or their affiliates. In addition, we generally
  will seek to include a clause in each lease that provides for increases in
  rent over the term of the lease. These increases are fixed or tied generally
  to increases in indices such as the CPI. The lease will also generally seek to
  provide for participation in gross revenues of the tenant at the property,
  thereby providing exposure to the commercial activity of the tenant, and
  providing the tenant some flexibility in lease terms. Alternatively, a lease
  may provide for mandated rental increases on specific dates, and we may adopt
  other methods in the future.
- Collateral Evaluation We review the physical condition of the property and assess the
  likelihood of replacing the rental stream if the tenant defaults. We also
  generally engage a third party to conduct, or require the seller to conduct a
  preliminary examination, or Phase 1 assessment, of the site to determine the
  potential for contamination or similar environmental site assessments in an
  attempt to identify potential environmental liabilities associated with a
  property prior to its acquisition. If potential environmental liabilities are
  identified, we generally require that identified environmental issues be
  resolved by the seller prior to property acquisition or, where such issues
  cannot be resolved prior to acquisition, require tenants contractually to
  assume responsibility for resolving identified environmental issues
  post-closing and provide indemnification protections against any potential
  claims, losses or expenses arising from such matters. We generally rely on our
  own analysis to determine whether to make an acquisition. Our analysis may
  take into consideration, among other things, the terms and conditions of the
  particular lease transaction, the quality of the lessees credit and the
  conditions of the credit markets at the time the lease transaction is
  negotiated. The value may be greater than the construction cost or the
  replacement cost of a property, and the actual sale price of a property if
  sold may be greater or less than the acquisition cost. In cases of special
  purpose real estate which we expect to acquire, a property is examined in
  light of the prospects for the tenant/borrowers enterprise and the financial
  strength and the role of that asset in the context of the tenants overall
  viability. Operating results of properties and other collateral may be
  examined to determine whether or not projected income levels are likely to be
  met.
- Transaction Provisions to Enhance and Protect
  Value We attempt to
  include provisions in the leases that we believe may help protect a real
  property asset from changes in the operating and financial characteristics of
  a tenant that may affect its ability to satisfy its obligations or reduce the
  value of the real property asset. Such provisions include requiring our
  consent to specified tenant activity, requiring the tenant to provide
  indemnification protections, and requiring the tenant to satisfy specific
  operating tests. We may also seek to enhance the likelihood of a tenants
  lease obligations being satisfied through

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a guaranty of obligations from the tenants corporate parent or other
entity or a letter of credit. This credit enhancement, if obtained, provides
additional financial security. However, in markets where competition for net
lease transactions is strong, some or all of these provisions may be replaced by
other measures of credit quality such as tenant investment in leasehold
improvements and commercial enterprise value of the tenant business conducted in
the property.

In addition, in some
circumstances, tenants may retain the right to repurchase the leased property.
The option purchase price is generally the greater of the contract purchase
price or the fair market value of the property at the time the option is
exercised.

- Equity
  Enhancements We may
  attempt to obtain equity enhancements in connection with transactions. These
  equity enhancements may involve warrants exercisable at a future time to
  purchase stock of the tenant or borrower or their parent. If warrants are
  obtained, and become exercisable, and if the value of the stock subsequently
  exceeds the exercise price of the warrant, equity enhancements can help
  achieve the goal of increasing investor returns.
- Other Real Estate Related
  Assets As other opportunities
  arise, we may also seek to expand the portfolio to include other types of real
  estate-related investments, in all cases within the energy infrastructure
  sector, such as:

- equity investments in real properties that are not long-term net leased
  to a single-tenant and may include partially leased properties, multi-tenanted properties, vacant
  or undeveloped properties and properties subject to short-term net leases,
  among others;
- mortgage loans secured by real
  properties;
- subordinated interests in first mortgage real estate loans, or
  B-notes;
- mezzanine loans related to real estate, which are senior to the
  borrowers equity position but subordinated to other third-party financing;
  and
- equity and debt securities
  (including preferred equity, limited partnership interests, trusts and other
  higher-yieldingstructured debt and
  equity investments) issued by companies that are engaged in
  real-estate-related businesses as defined by regulations promulgated under the
  Internal Revenue Code (the Code), including other REITs.

Real Property Asset
Management

We believe that
effective management of our assets is essential to maintain and enhance property
values. Important aspects of asset management include restructuring transactions
to meet the evolving needs of current tenants, re-leasing properties,
refinancing debt, selling properties and knowledge of the bankruptcy
process.

We are externally
managed by Corridor InfraTrust Management, LLC (formerly Corridor Energy, LLC)
(Corridor). The Corridor team consists of energy asset professionals with
experience across several segments of the energy sector and is primarily
responsible for evaluating, negotiating and structuring potential real property
asset opportunities. Tortoise Capital Advisors, L.L.C., a registered investment
adviser (TCA), provides us certain securities focused investment services
necessary to evaluate, monitor and liquidate our remaining securities portfolio.
Before a real property asset is acquired by us, the transaction is reviewed and
approved by the managing directors of Corridor and TCA. The approval is subject
to final approval by our Board of Directors. Our Board of Directors is not
directly involved in originating or negotiating potential asset acquisitions but
instead functions as a separate and final step in the process.

We monitor, on an
ongoing basis, compliance by tenants with their lease obligations and other
factors that could affect the financial performance of any of our properties.
Monitoring involves receiving assurances that each tenant has paid real estate
taxes, assessments and other expenses relating to the properties it occupies and
confirming that appropriate insurance coverage is being maintained by the
tenant. We review financial statements of tenants and undertake regular physical
inspections of the condition and maintenance of properties. Additionally, we
periodically analyze each tenants financial condition, the industry in which
each tenant operates and each tenants relative strength in its
industry.

Financing
Strategies

Consistent with our
asset acquisition policies, we use leverage when available on terms we believe
are favorable. The amount of leverage that we may employ will depend on our
assessment of market conditions and other factors at the time of any proposed
borrowing. Although we currently do not anticipate doing so, the amount of total
leverage we employ may exceed 50% of our total assets, which was the maximum
amount of leverage we could employ as a BDC. Substantially all of our mortgage
loans are expected to be non-recourse. A lender on non-recourse mortgage debt
generally has recourse only to the property collateralizing such debt and not to
any of our other assets, while full recourse financing would give a lender
recourse to all of our assets. The use of non-recourse debt, therefore, helps us
to limit the exposure of all of our assets to any one debt obligation. Lenders
may, however, have recourse to our other assets in limited circumstances not
related to the repayment of the indebtedness, such as under an environmental
indemnity. We also expect to have an unsecured line of credit that can be used
in connection with refinancing existing debt and making new acquisitions, as
well as to meet other working capital needs. We expect to incur debt which bears
interest at fixed rates, or is effectively converted to fixed rates through
interest rate caps or swap agreements.

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Competition

We compete with public
and private funds, commercial and investment banks and commercial financing
companies to make the types of investments that we plan to make in the U.S.
energy infrastructure sector. Many of our competitors are substantially larger
and have considerably greater financial, technical and marketing resources than
us. For example, some competitors may have a lower cost of funds and access to
funding sources than are available to us. In addition, some of our competitors
may have higher risk tolerances or different risk assessments, allowing them to
consider a wider variety of investments and establish more relationships than
us. These competitive conditions may adversely affect our ability to make
investments in the energy infrastructure sector and could adversely affect our
distributions to stockholders.

Competitive
Advantages

We believe that we are
well positioned to meet the financing needs of companies within the U.S. energy
infrastructure sector for the following reasons:

- Attractive Strategic Partner for Energy and Power Infrastructure
  Companies.We believe
  that we are a desirable partner for energy and power infrastructure companies
  because we have specialized knowledge of the economic, regulatory, and
  stakeholder considerations faced by them. We do not intend to compete with the
  operations of our lessees and are willing to enter into long-term lease and
  financing arrangements that suit the requirements and achieve the goals of
  energy and power infrastructure companies.
- Broad Energy and Power Infrastructure Scope.We intend to focus on assets, among others,
  that transmit commodities or serve customers which are not permissible assets
  to be owned by other specialized energy companies such as MLPs. For example
  the Eastern Interconnect Project and Mowood's Omega pipeline are not MLP
  qualified assets.
- Efficient Capital Provider.If we are able to qualify as a REIT, our
  shareholders will not receive UBTI or Effectively Connected Income. This
  offers us access to investors which desire the risk adjusted return profile
  but which may have limitations on investing in other specialized
  infrastructure vehicles such as direct investment in infrastructure, private
  equity funds, or MLPs. As a REIT, TTO is expected to have a lower overall cost
  of capital when compared to certain other energy and power infrastructure
  acquirors, which should enhance our future cash flows and provide for
  increased value growth opportunities.
- *Disciplined Investment Philosophy.*** As we focus on acquiring real property
  assets, our investment approach emphasizes overall asset operational and
  financial performance with the potential for enhanced returns through
  incremental asset growth, capital appreciation, and minimization of downside
  risk. Our process involves an assessment of the overall attractiveness of the
  specific subsector of the energy infrastructure sector in which a prospective
  operating company is involved; such companys specific competitive position
  within that subsector; operational asset engineering due diligence; potential
  commodity price, supply and demand and regulatory concerns; the stability and
  potential growth of the prospective real property assets cash flows; the
  prospective operating company's management track record and our ability to
  structure an attractive investment.
- *Experienced Management Team.*** The
  principals of Corridor have an average of over 24 years of experience in
  energy operations of multi-national electric and gas utilities, national
  energy marketing and trading businesses and in optimizing portfolios for real
  energy asset investments. Based on their real property asset operational
  experience and strong industry relationships we believe the principals of
  Corridor provide the expertise and knowledge necessary to acquire real
  property assets with strong performance standards. The members of TCAs
  investment committee have an average of over 24 years of financial investment
  experience. TCAs investment professionals are responsible for evaluating,
  monitoring and liquidating our remaining securities
  portfolio.
- Flexible Transaction Structuring.We are not subject to many of the regulatory
  limitations that govern traditional lending institutions such as commercial
  banks. As a result, we can be flexible in structuring asset acquisition
  transactions. This structuring flexibility enables our leases and debt
  instruments to fit the cash flow characteristics of the assets that we
  acquire. TCAs and Corridors professionals have substantial experience in
  structuring investments that balance the needs of an energy infrastructure
  operating company with appropriate risk control.

While we believe we are
well positioned to meet the financing needs of companies within the U.S. energy
infrastructure sector, an investment in our securities involves certain risks
that may preclude us from achieving our investment objective. For example, we
may be unable to identify and complete acquisitions of real property assets or
sell real property assets at timesor at prices that we desire. In
addition, if we elect to be taxed as a REIT, the loss of our REIT status would
have significant adverse consequences.

Employees

We do not currently have
or expect to have any employees. Pursuant to a Management Agreement and
Administration Agreement, Corridor has agreed to use its reasonable best efforts
to present us with suitable acquisition opportunities consistent with our
investment objectives and policies and is generally responsible, subject to the
supervision and review of our Board of Directors, for the day to day
operations.

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Management
Agreement

Pursuant to the
Management Agreement, we pay Corridor quarterly a base management fee equal to
0.25% (1.00% annualized) of our average monthly Managed Assets for such quarter,
calculated and paid in arrears within 30 days of the end of each fiscal quarter.
The term Managed Assets as used in the calculation of the management fee means
all of our securities and real property assets (including any securities or real
property assets purchased with or attributable to borrowed funds) minus accrued
liabilities other than (1) deferred taxes and (2) debt entered into for the
purpose of leverage. Accrued liabilities are expenses incurred in the normal
course of our operations. For purposes of the definition of Managed Assets,
securities includes our securities portfolio, valued at then current market
value. For purposes of the definition of Managed Assets, real property assets
includes our assets invested, directly or indirectly, in equity interests in or
loans secured by real estate and personal property owned in connection with such
real estate (including acquisition related costs and acquisition costs that may
be allocated to intangibles or are unallocated), valued at the aggregate
historical cost, before reserves for depreciation, amortization, impairment
charges or bad debts or other similar noncash reserves. The base management fee
for any partial quarter will be appropriately prorated.

We also pay Corridor
quarterly an incentive fee of 10% of the increase in distributions paid over a
threshold distribution equal to $0.125 per share per quarter, calculated and
paid in arrears within 30 days of the end of each fiscal quarter. No incentive
fee shall be paid on (i) any dividend paid after the Board of Directors has
determined to liquidate us, or (ii) all or any portion of any dividend expected
by the Board of Directors not to be sustainable in subsequent quarters. The
incentive fee for any partial quarter will be appropriately prorated. At least
half of any incentive fee paid to Corridor must be reinvested by Corridor in our
common stock.

Administrative
Services

Pursuant to the
Management Agreement, Corridor furnishes us with office facilities and clerical
and administrative services necessary for our operation (other than services
provided by our custodian, accounting agent, administrator, dividend and
interest paying agent and other service providers). Corridor is authorized to
enter into agreements with third parties to provide such services. To the extent
we request, Corridor will (i) oversee the performance and payment of the fees of
our service providers and make such reports and recommendations to the Board of
Directors concerning such matters as the parties deem desirable, (ii) respond to
inquiries and otherwise assist such service providers in the preparation and
filing of regulatory reports, proxy statements, and stockholder communications,
and the preparation of materials and reports for the Board of Directors; (iii)
establish and oversee the implementation of borrowing facilities or other forms
of leverage authorized by the Board of Directors and (iv) supervise any other
aspect of our administration as may be agreed upon by us and Corridor. We have
agreed, pursuant to the Agreement, to reimburse Corridor for all out-of-pocket
expenses incurred in providing the foregoing.

We bear all expenses not
specifically assumed by Corridor and incurred in our operations. The
compensation and allocable routine overhead expenses of all investment
professionals of Corridor and its staff, when and to the extent engaged in
providing us investment advisory management services, is provided and paid for
by Corridor and not us.

Duration and
Termination

The Management Agreement
was initially reviewed and approved by our Board of Directors. It will remain in
effect until December 31, 2012 and is renewable annually thereafter by us. The
Management Agreement may be terminated by us, by vote of the Board of Directors,
without penalty upon not more than 60 days written notice to Corridor. The
Management Agreement may also be terminated by Corridor without penalty upon not
less than 60 days written notice to us.

Our Manager

We are externally
managed by Corridor InfraTrust Management, LLC (formerly Corridor Energy, LLC)
(Corridor). Corridor is an asset manager specializing in financing the
acquisition or development of infrastructure real property assets. Corridor
assists us in identifying infrastructure real property asset investments that
can be leased to businesses that make goods, provide services or own assets
other than securities, which business we refer to herein as operating
companies and is generally responsible for our day-to-day operations. Tortoise
Capital Advisors, L.L.C., a registered investment adviser (TCA), provides us
certain securities focused investment services necessary to evaluate, monitor
and liquidate our remaining securities portfolio and also provides us with
certain operational (i.e. non-investment) services. Corridor compensates TCA for
the securitiesfocused investments and services TCA provides to
us.

Corridor currently has
four investment professionals who are primarily responsible for the origination,
structuring and managing of our real property asset investments. This team
provides investors and operator partners with the industry expertise of energy
operations, energy portfolio management and capital markets. Corridor is located
at 4200 W. 115th Street, Suite 210, Leawood, Kansas 66211. Corridor is an
affiliate of TCA.

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Richard C. (Rick)
Green


Mr. Green serves as
our Chairman and is a co-founder and Managing Director of Corridor. He has spent
more than 30 years in the energy industry serving as a CEO for more than 20
years. During his tenure, Mr. Green demonstrated leadership and perseverance in
pioneering the strategy and successful execution of a significant business
expansion of Aquila Inc., formerly UtiliCorp United, to a Fortune 30 company.
Aquila Inc. was an international electric and gas utility business and national
energy marketing and trading business. Mr. Green has also been credited with
leading a successful wind down of the merchant trading operations of Aquila Inc.
to provide shareholder focus on the companys utility market strategy during the
2002 energy market crisis. From 2006-2008, Mr. Green successfully directed the
complicated separation and ultimate sale of Aquilas multi-state utility
operations. Mr. Green then founded The Calvin Group LLC, a consulting firm that
leveraged the management and operational experience of the partners to catalyze
the management teams of energy companies. Mr. Green is currently on the board,
and was previously a chairman of, the Midwest Research Institute, and has also
served on the board for the National Renewable Energy Laboratories in Golden,
Colorado.


David J. Schulte, CFA,
CPA Mr. Schulte is
a co-founder and Managing Director of both Corridor and TCA, where he serves on
the investment committee, and is also our Chief Executive Officer. In addition,
Mr. Schulte serves as Senior Vice President of Tortoise Energy Infrastructure
Corporation (NYSE: TYG), Tortoise Energy Capital Corporation (NYSE: TYY),
Tortoise North American Energy Corporation (NYSE: TYN), Tortoise Power and
Energy Infrastructure Fund Inc. (NYSE: TPZ), Tortoise MLP Fund, Inc. (NYSE: NTG)
and Tortoise Pipeline & Energy Fund, Inc. (NYSE: TPZ). From 1993-2002, Mr.
Schulte was a Managing Director at Kansas City Equity Partners, L.C. (KCEP).
While a partner at KCEP, Mr. Schulte led private financing for two growth MLPs
in the energy infrastructure sector, Inergy, L.P., where he served as a
director, and MarkWest Energy Partners, L.P., where he was a board observer.
Prior to joining KCEP, Mr. Schulte had over five years of experience completing
acquisition and publicequity financings as an
investment banker at the predecessor of Oppenheimer & Co., Inc. In 2011, Mr.
Schulte and his partners at TCA were awarded the Ernst & Young Entrepreneur
of the Year® award for financial services companies in the Central Midwest
region.

David W.
HaleyMr. Haley is
a Director of Corridor and our Senior Vice President. He has over 20 years of
experience in the energy industry. Prior to joining Corridor, Mr. Haley was a
Vice President at the consulting firm, The Calvin Group. From 2002-2008 he was
Managing Director of EnFocus, a consulting firm focused on risk management and
structuring transactions for clients in the energy and financial services
industries. Mr. Haley was previously Vice President of Cross Commodity Trading
for Aquila Merchant Services, where he directed a group engaged in market
marking, risk management and proprietary trading of crude oil, natural gas,
residual and heating oil, electricity, coal and financial transmission
rights/transmission congestion credits. He was also responsible for managing the
risks and optimizing a portfolio of asset investments including power plants,
electric transmission, natural gas transportation and natural gas storage.
Before joining Aquila, he was Vice President of Cinergy Corp. where he directed
structuring, valuation analysis and transaction pricing for mergers &
acquisitions and leveraged buyouts/ financial restructurings of independent
power projects.

Rebecca M.
SandringMs.
Sandring is Principal of Corridor and our Treasurer. She has over 20 years of
experience in the energy industry. As a Vice President with The Calvin Group,
she created strategic business plans resulting in third party investments and
provided financial leadership to a wind development company, which resulted in
planned project cost reductions. From 1993-2008 Ms. Sandring had various roles
at Aquila Inc, formerly UtiliCorp United, a regulated gas and electric utility
serving a multi-state region with international operations including
transmission, distribution and generation. Ms. Sandrings roles at UtiliCorp and
then Aquila Inc. were in operational finance, and included business valuations,
project and corporate finance, process efficiency, implementation of complex
GAAP accounting policies and internal accounting and risk system designs. As
Director of Finance at Aquila, Inc. she was responsible for leading the internal
finance team, which worked with external advisors regarding the strategic
alternatives for Aquila, Inc. In her role as Director of Finance for the
unregulated power generation division, which had over 4,000 megawatts of
generation capacity, she was responsible for building the accounting, strategic
planning and forecasting team and process.

Tortoise Capital Advisors,
L.L.C.

Tortoise Capital
Advisors, L.L.C., a registered investment adviser, provides us certain
securities focused investment services necessary to evaluate, monitor and
liquidate our remaining securities portfolio and also provides us with certain
operational (i.e. non-investment) services. We have also entered into an
Administration Agreement with TCA pursuant to which TCA acts as our
administrator and performs (or oversees or arranges for the performance of) the
administrative services necessary for our operation, including without
limitation providing us with equipment, clerical, bookkeeping and record keeping
services. For these services we pay TCA a fee equal to 0.04% of our aggregate
average daily Managed Assets, with a minimum annual fee of
$30,000.

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The investment committee
of TCA consists of H. Kevin Birzer, Zachary A. Hamel, Kenneth P. Malvey, Terry
C. Matlack and David J. Schulte, all of whom are Managing Directors of TCA. TCA
is located at 11550 Ash Street, Suite 300, Leawood, Kansas 66211. TCA
specializes in listed energy infrastructure investments. As of January 31, 2012,
TCA had approximately $7.8 billion of assets under management in NYSE listed
closed-end investment companies, an open-end fund and other accounts. Corridor
compensates TCA for the services TCA provides to us, other than the services
provided to us pursuant to the Administration Agreement to which we and TCA are
a party.

Consultant
Arrangement

Corridor has retained
Kenmont Capital Partners L.P. as a consultant. Kenmont assists Corridor in
identifying potential real property asset acquisition opportunities for us.
Corridor compensates Kenmont for the services it provides to us.

Available
Information

Our principal executive
offices are located at 11550 Ash Street, Suite 300, Leawood, Kansas 66211. Our
telephone number is (913) 981-1020, or toll-free 1-866-362-9331, and our Web
site is www.tortoiseadvisors.com/tto.cfm. We are required to file reports, proxy
statements and other information with the SEC. We will make available free of
charge our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current
Reports on Form 8-K and any amendments to those reports on or through our Web
site at www.tortoiseadvisors.com/tto.cfm as soon as reasonably practicable after
such material is electronically filed with, or furnished to, the SEC. This
information may also be obtained, without charge, upon request by calling us at
(913) 981-1020 or toll-free at (866) 362-9331. This information will also be
available at the SECs Public Reference Room at 100 F Street, NE, Washington, DC
20549. You may obtain information on the operation of the Public Reference Room
by calling the SEC at 1-800-SEC-0330. The SEC maintains an Internet site that
contains reports, proxy and information statements and other information filed
by us with the SEC which is available on the SECs internet site at www.sec.gov.
Please note that any internet addresses provided in this Form 10-K are for
informational purposes only and are not intended to be hyperlinks. Accordingly,
no information found and/or provided at such internet address is intended or
deemed to be included by reference herein.

ITEM 1A. RISK
FACTORSThere are
many risks and uncertainties that can affect our future business, financial
performance or share price. Many of these are beyond our control. A description
follows of some of the important factors that could have a material negative
impact on our future business, operating results, financial condition or share
price. This discussion includes a number of forward-looking statements. You
should refer to the description of the qualifications and limitations on
forward-looking statements in the first paragraph under Item 7 Managements
Discussion and Analysis of Financial Condition and Results of Operations of
this Form 10-K.

Risks Related to Our
Operations

Investors are no longer
protected by the regulatory provisions of the 1940 Act.On September 21, 2011, we withdrew our election to
be regulated as a BDC under the 1940 Act. Thus, we are no longer regulated as a
BDC and are no longer subject to the regulatory provisions of the 1940 Act. The
1940 Act is designed to protect the interests of investors in investment
companies, with requirements relating to insurance, custody, and capital
structure, composition of the Board of Directors, affiliated transactions,
leverage limitations and compensation arrangements.

We intend in the future to
elect to be taxed as a REIT, but may not be able to qualify as a
REIT.We intend to
elect to be a REIT for federal income tax purposes. In order to qualify as a
REIT, a substantial percentage of our income must be derived from, and our
assets consist of, real estate assets, and, in certain cases, other investment
property. We intend to acquire and manage investments to satisfy the REIT tests.
Whether a particular investment is considered a real estate asset for such
purposes depends upon the facts and circumstances of the investment. Due to the
factual nature of the determination, at this time we do not know whether any
particular investment will qualify as a real estate asset or satisfy the REIT
income tests. In determining whether an investment is a real property asset, we
will look at the Code and the IRSs interpretation of the Code in regulations,
published rulings, private letter rulings and other guidance. In the case of a
private letter ruling issued to another taxpayer, we would not be able to bind
the IRS to the holding of such ruling. If we fail to qualify as a REIT we may
not be able to achieve our objectives and the value of our stock may
decline.

If we elect to be taxed as a
REIT, we would be subject to a corporate level tax on certain built in gains if
certain assets were sold during the 10 year period following such
election.We are
currently taxed as a C corporation, which subjects our income to double level
taxation. Generally, a REIT is treated as a flow-through entity for federal
income tax purposes, as a REITs income is generally subject to a single level
of federal taxation.

If we find sufficient suitable REIT-qualifying investments and satisfy the REIT requirements throughout our
fiscal year, we expect to make an election to be treated as a REIT for tax purposes for that fiscal year by filing a Form 1120-REIT
on or before March 15of the subsequent fiscal year, or such later date to which we have properly extended filing such
income tax return. We do not currently expect that we will be able to elect to be treated as a REIT for tax purposes for the 2012
fiscal year, but also do not expect that our lack of REIT status will hinder our ability to pay distributions on a quarterly basis.

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A REIT generally
operates without incurring any corporate level federal income tax, which is
accomplished by the REIT annually distributing at least ninety percent of its
REIT taxable income. If it satisfies the minimum distribution requirement, the
REIT generally is entitled to a deduction for dividends paid. The REIT
stockholders are then required to report the REIT dividend as ordinary income. A
REIT stockholders receipt of dividends generally will not qualify as qualified
dividend income or for the dividends received deduction discussed above. Thus,
if we are able to qualify as a REIT, we will be more favorably treated for
federal income tax purposes than our current taxation.

In order to qualify as a
REIT, we would be required to satisfy gross income and asset tests. Generally,
such tests require that a substantial percentage of the REITs income be derived
from, and assets consist of, real estate assets, and, in certain cases, other
investment property. This will be a factual determination that we generally will
have to make annually with respect to the income tests and quarterly with
respect to the asset tests.

If we elect to be taxed as a
REIT, loss of our status as a REIT would have significant adverse
consequences.If we
fail to qualify as a REIT in any taxable year, then we would be subject to
federal income tax (including any applicable minimum tax) on our taxable income
computed in the usual manner for corporate taxpayers without any deduction for
distributions to our stockholders. Unless entitled to relief under specific
statutory provisions, we would be disqualified from treatment as a REIT for the
four taxable years following the year of losing our REIT status, assuming we had
previously been treated as a REIT. To renew our REIT qualification at the end of
such a four-year period, we would be required to distribute all of our current
and accumulated earnings and profits before the end of the period and the funds
available for satisfying our obligations and for distribution to our
stockholders could be significantly reduced.

If we elect to be taxed as a
REIT, re-characterization of sale-leaseback transactions may cause us to lose
our REIT status.We
intend to purchase properties and simultaneously lease the same property back to
the seller of such properties. While we will use our best efforts to structure
any such sale-leaseback transaction so that the lease will be characterized as a
true lease, thereby allowing us to be treated as the owner of the property for
U.S. federal income tax purposes, the IRS could challenge such characterization.
In the event that any sale-leaseback transaction is re-characterized as a
financing transaction or loan for U.S. federal income tax purposes, deductions
for depreciation and cost recovery relating to such property would be
disallowed. If a sale-leaseback transaction were so re-characterized, we might
fail to satisfy the REIT qualification asset tests or the income tests and,
consequently, lose our REIT status effective with the year of
re-characterization. Alternatively, the amount of our REIT taxable income could
be recalculated which might also cause us to fail to meet the distribution
requirement for a taxable year.

We may be unable to identify
and complete acquisitions of real property assets.Our ability to identify and complete
acquisitions of real property assets on favorable terms and conditions are
subject to the following risks:

- we may be unable to acquire a
  desired asset because of competition from other investors with significant
  capital, includingpublicly
  traded REITs and institutional investment funds;
- competition from other investors
  may significantly increase the purchase price of a desired real property asset
  or result in lessfavorable
  terms;
- we may not complete the acquisition
  of a desired real property asset even if we have signed an agreement to
  acquire such realproperty
  asset because such agreements are subject to customary conditions to closing,
  including completion of due diligence investigations to our
  satisfaction;
- we may be unable to finance
  acquisitions of real property assets on favorable terms or at all.

Net leases may not result in
fair market lease rates over time.We expect a large portion of our future income
to come from net leases. Net leases typically have longer lease terms and, thus,
there is an increased risk that if market rental rates increase in future years,
the rates under our net leases will be less than fair market rental rates during
those years. As a result, our income and distributions could be lower than they
would otherwise be if we did not engage in net leases. We generally will seek to
include a clause in each lease that provides increases in rent over the term of
the lease, but there can be no assurance we will be successful in obtaining such
a clause.

Some losses related to our
real property assets may not be covered by insurance and would adversely impact
distributions to stockholders.Our leases will generally require the tenant
company to carry comprehensive liability and casualty insurance on our
properties comparable in amounts and against risks customarily insured against
by other companies engaged in similar businesses in the same geographic region
as our tenant company. We believe the required coverage will be of the type, and
amount, customarily obtained by an owner of similar properties. However, there
are some types of losses, such as catastrophic acts of nature, acts of war or
riots, for which we or our tenants cannot obtain insurance at an acceptable
cost. If there is an uninsured loss or a loss in

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excess of insurance limits, we could
lose both the revenues generated by the affected property and the capital we
have invested in the property if our tenant company fails to pay us the casualty
value in excess of such insurance limit, if any, or to indemnify us for such
loss. This would in turn reduce the amount of income available for
distributions. We would, however, remain obligated to repay any secured
indebtedness or other obligations related to the property. Since September 11,
2001, the cost of insurance protection against terrorist acts has risen
dramatically. The cost of coverage for acts of terrorism is currently mitigated
by the Terrorism Risk Insurance Act (TRIA). If TRIA is not extended beyond its
current expiration date of December 31, 2014, our tenants may incur higher
insurance costs and greater difficulty in obtaining insurance that covers
terrorist-related damages. There can be no assurance our tenant companies will
be able to obtain terrorism insurance coverage, or that any coverage they do
obtain will adequately protect our properties against loss from terrorist
attack.

If a sale-leaseback
transaction is re-characterized in a lessee companys bankruptcy proceeding, our
financial condition could be adversely affected.We intend to enter into sale-leaseback
transactions, whereby we purchase a property and then simultaneously lease the
same property back to the seller. In the event of the bankruptcy of a lessee
company, a transaction structured as a sale-leaseback may be re-characterized as
either a financing or a joint venture, either of which outcomes could adversely
affect our business. If the sale-leaseback were re-characterized as a financing,
we might not be considered the owner of the property, and as a result would have
the status of a creditor in relation to the lessee company. In that event, we
would no longer have the right to sell or encumber our ownership interest in the
property. Instead, we would have a claim against the lessee company for the
amounts owed under the lease, with the claim arguably secured by the property.
The lessee company/debtor might have the ability to restructure the terms,
interest rate and amortization schedule of its outstanding balance. If confirmed
by the bankruptcy court, we could be bound by the new terms, and prevented from
foreclosing our lien on the property. If the sale-leaseback were
re-characterized as a joint venture, we and the lessee company could be treated
as co-ventures with regard to the property. As a result, we could be held
liable, under some circumstances, for debts incurred by the lessee company
relating to the property. Either of these outcomes could adversely affect our
cash flow and the amount available for distribution.

We may not be able to sell our
real property asset investments when we desire.Investments in real property assets are
relatively illiquid compared to other investments. Accordingly, we may not be
able to sell real property asset investments when we desire or at prices
acceptable to us in response to changes in economic or other conditions. This
could substantially reduce the funds available for satisfying our obligations
and for distribution to our stockholders.

Costs of complying with
governmental laws and regulations, including those relating to environmental
matters, may adversely affect our income and the cash available for
distribution.We
have invested, and expect to continue to invest, in real property assets, which
are subject to laws and regulations relating to the protection of the
environment and human health and safety. These laws and regulations generally
govern wastewater discharges, air emissions, the operation and removal of
underground and aboveground storage tanks, the use, storage, treatment,
transportation and disposal of solid and hazardous materials, and the
remediation of contamination associated with disposals. Environmental laws and
regulations may impose joint and several liabilities on tenants, owners or
operators for the costs to investigate or remediate contaminated properties,
regardless of fault or whether the acts causing the contamination were legal.
This liability could be substantial. In addition, the presence of hazardous
substances, or the failure to properly remediate these substances, may adversely
affect our ability to sell, rent or pledge such property as collateral for
future borrowings.

Some of these laws and
regulations have been amended so as to require compliance with new or more
stringent standards as of future dates. Compliance with new or more stringent
laws or regulations or stricter interpretation of existing laws may require
material expenditures by us. Future laws, ordinances or regulations may impose
material environmental liability. Additionally, our tenant companies
operations, the existing condition of land when we buy it, operations in the
vicinity of our properties, such as the presence of underground storage tanks,
or activities of unrelated third parties may affect our properties. In addition,
there are various local, state and federal fire, health, life-safety and similar
regulations with which we may be required to comply, and that may subject us to
liability in the form of fines or damages for noncompliance. Any material
expenditures, fines, or damages we must pay will reduce our ability to make
distributions.

State and federal laws
in this area are constantly evolving, and we intend to monitor these laws and
take commercially reasonable steps to protect ourselves from the impact of these
laws, including where deemed necessary, obtaining environmental assessments of
properties that we acquire; however, we will not obtain an independent
third-party environmental assessment for every property we acquire. In addition,
any such assessment that we do obtain may not reveal all environmental
liabilities or whether a prior owner of a property created a material
environmental condition not known to us. The cost of defending against claims of
liability, of compliance with environmental regulatory requirements, of
remediating any contaminated property, or of paying personal injury claims would
materially adversely affect our business, assets or results of operations and,
consequently, amounts available for distribution.

13

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If we elect to be treated as a
REIT, we will be required to make distributions, other than capital gain
distributions, to our stockholders each year in the amount of at least 90% of
our REIT taxable income As a result; we will continue to need additional capital
to make new investments. If additional funds are unavailable or not available on
favorable terms, our ability to make new investments will be
impaired.If we
elect to be treated as a REIT, we will be required to distribute at least 90% of
our REIT taxable income, and as such we may require additional capital to make
new investments or carry existing investments. We may acquire additional capital
from the issuance of securities senior to our common shares, including
additional borrowings or other indebtedness or the issuance of additional
securities. We may also acquire additional capital through the issuance of
additional equity. However, we may not be able to raise additional capital in
the future on favorable terms or at all. Unfavorable economic conditions could
increase our funding costs, limit our access to the capital markets or result in
a decision by lenders not to extend credit to us. We may issue debt securities,
other instruments of indebtedness or preferred stock, and we borrow money from
banks or other financial institutions, which we refer to collectively as senior
securities. As a result of issuing senior securities, we will also be exposed
to typical risks associated with leverage, including increased risk of loss. If
we issue preferred securities which will rank senior to our common shares in
our capital structure, the holders of such preferred securities may have
separate voting rights and other rights, preferences or privileges more
favorable than those of our common shares, and the issuance of such preferred
securities could have the effect of delaying, deferring or preventing a
transaction or a change of control that might involve a premium price for
security holders or otherwise be in our best interest.

To the extent our
ability to issue debt or other senior securities is constrained, we will depend
on issuances of additional common shares to finance new investments. If we raise
additional funds by issuing more of our common shares or senior securities
convertible into, or exchangeable for, our common shares, the percentage
ownership of our stockholders at that time would decrease, and you may
experience dilution.

Corridor may serve as a
manager to other entities, which may create conflicts of interest not in the
best interest of us or our stockholders.Corridors services under the Management
Agreement are not exclusive, and, while it currently does not have any
contractual arrangement to do so, it is free to furnish the same or similar
services to other entities, including businesses that may directly or indirectly
compete with us so long as its services to us are not impaired by the provision
of such services to others. Corridor and its members may have obligations to
other entities, the fulfillment of which might not be in the best interests of
us or our stockholders.

We will be dependent upon key
personnel of Corridor for our future success.We have entered into a management agreement
with Corridor to provide full management services to us for real property asset
investments. We will be dependent on the diligence, expertise and business
relationships of the management of Corridor to implement our strategy of
acquiring real property assets. The departure of one or more investment
professionals of Corridor could have a material adverse effect on our ability to
implement this strategy and on the value of our common shares. There can be no
assurance that we will be successful in implementing our
strategy.

We are dependent upon TCAs
key personnel to effectuate an orderly liquidation of our remaining securities
portfolio.TCAs
investment professionals and management will evaluate, monitor and liquidate our
remaining securities portfolio. The departure of one or more investment
professionals of TCA could have a material adverse effect on our ability to
achieve an orderly liquidation of our remaining securities portfolio. We will
rely on employees of TCA who will be devoting significant amounts of their time
to non-Company related activities of TCA. To the extent TCAs investment
professionals and management are unable to, or do not, devote sufficient amounts
of their time and energy to our affairs, our performance may
suffer.

Our remaining securities
investments in privately-held companies present certain challenges, including
availability of information about these companies and illiquidity that may
impact our ability to liquidate investments in a timely and/ or advantageous
manner.We
currently have securities investments remaining in privately-held companies.
Generally, little public information exists about these companies, and we are
required to rely on the ability of TCA to obtain adequate information to
evaluate the potential risks and returns involved with these companies. If TCA
is unable to obtain all material information about these companies, including
with respect to operational, regulatory, environmental, litigation and
managerial risks, TCA may not make a fully-informed investment decision, and we
may lose some or all of the money invested in these companies. Substantially all
of these securities are subject to legal and other restrictions on resale or are
otherwise less liquid than publicly traded securities. The illiquidity of these
investments may make it difficult for us to sell such investments at
advantageous times and prices or in a timely manner. In addition, if we are
required to liquidate all or a portion of our remaining securities portfolio
quickly, we may realize significantly less than the value at which we previously
have recorded our investments. We also may face other restrictions on our
ability to liquidate an investment in the securities of a portfolio company to
the extent that we or one of our affiliates have material non-public information
regarding such portfolio company.

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All of our remaining
securities investments are, and will continue to be, recorded at fair value.
Because such valuations are inherently uncertain, our determinations of fair
value may differ materially from the values that would have been used if a ready
market for these securities existed.We continue to hold investments that are in the
form of securities or loans that are not publicly traded. The fair value of
these investments may not be readily determinable. For securities investments
that are reported at fair value, we will value these investments quarterly at
fair value. We have retained Lincoln Partners Advisors, LLC (an independent
valuation firm) to provide third party valuation consulting services. The Board
of Directors is ultimately responsible for determining the fair value of the
investments in good faith. The types of factors that may be considered in fair
value pricing of an investment include the nature and realizable value of any
collateral, the portfolio companys earnings and ability to make payments, the
markets in which the portfolio company does business, comparison to publicly
traded companies, discounted cash flow and other relevant factors. Because such
valuations are inherently uncertain, our determinations of fair value may differ
materially from the values that would have been used if a ready market for these
securities existed. As a result, we may not be able to dispose of our holdings
at a price equal to or greater than the determined fair value, which could have
a negative impact on our equity and earnings.

The lack of liquidity in our
securities investments may make it difficult to liquidate our securities
portfolio at favorable prices and, as a result, we may suffer
losses.We have
historically invested in the equity of companies whose securities are not
publicly traded, and whose securities may be subject to legal and other
restrictions on resale or otherwise be less liquid than publicly-traded
securities. As of November 30, 2011, approximately 61% of our investments were
invested in illiquid securities. The illiquidity of these investments may make
it difficult for us to sell these investments when desired. In addition, we may
realize significantly less than the value at which we had previously recorded
these investments when we liquidate our securities portfolio. The illiquidity of
most of our securities investments may make it difficult for us to dispose of
them at favorable prices, and, as a result, we may suffer losses.

If our acquisitions do not
meet our performance expectations, you may not receive
distributions.We
intend to make distributions on a quarterly basis to our stockholders out of
assets legally available for distribution. We may not be able to achieve
operating results that will allow us to make distributions at a specific level
or to increase the amount of these distributions from time to time. Also,
restrictions and provisions in any credit facilities we enter into or debt
securities we issue may limit our ability to make distributions. We cannot
assure you that you will receive distributions at a particular level or at
all.

If we were deemed an
investment company under the Investment Company Act of 1940, applicable
restrictions could make it impractical for us to continue our business as
contemplated and could have a material adverse effect on our business and the
price of our securities.We do not believe that we are an investment company under the 1940
Act. If during the period in which we are liquidating our securities portfolio
we make an investment in securities, or one of our infrastructure real property
asset acquisitions were characterized as an investment in securities, we could
be deemed as an investment company for purposes of the 1940 Act. If we were to
be deemed an investment company, however, restrictions imposed by the 1940 Act,
including limitations on our capital structure, could make it impractical for us
to continue our business as contemplated and would have a material adverse
effect on our operations and the price of our common shares.

Changes in laws or regulations
or in the interpretations of laws or regulations could significantly affect our
operations and cost of doing business.We are subject to federal, state and local laws
and regulations and are subject to judicial and administrative decisions that
affect our operations, including loan originations, maximum interest rates, fees
and other charges, disclosures to portfolio companies, the terms of secured
transactions, collection and foreclosure procedures and other trade practices.
If these laws, regulations or decisions change, we may have to incur significant
expenses in order to comply, or we may have to restrict our operations. In
addition, if we do not comply with applicable laws, regulations and decisions,
or fail to obtain licenses that may become necessary for the conduct of our
business; we may be subject to civil fines and criminal penalties, any of which
could have a material adverse effect upon our business, results of operations or
financial condition.

Provisions of the Maryland
General Corporation Law and our charter and bylaws could deter takeover attempts
and have an adverse impact on the price of our common
shares.The
Maryland General Corporation Law and our charter and bylaws contain provisions
that may have the effect of discouraging, delaying or making difficult a change
in control of our company or the removal of our incumbent directors.

We are subject to the
Business Combination Act of the Maryland General Corporation Law which prohibits
certain business combinations between a Maryland corporation and an interested
stockholder or their affiliate. As permitted by law, however, our Board of
Directors has adopted a resolution exempting us from the Maryland Business
Combination Act for any business combination between us and any person to the
extent that such business combination receives the prior approval of our
Board.

The Maryland Control
Share Acquisition Act generally provides that a holder of control shares of a
Maryland corporation acquired in a control share acquisition has no voting
rights except to the extent approved by a vote of two-thirds of the votes
entitled to be cast on the matter. Shares owned by a person who makes a proposal
to make a control share acquisition and by

15

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officers or by directors
who are employees of the corporation are excluded from shares entitled to vote
on the matter. Our Bylaws exempt from the Maryland Control Share Acquisition Act
acquisitions of stock by any person. If we amend our Bylaws to repeal the
exemption from the Maryland Control Share Acquisition Act, the Maryland Control
Share Acquisition Act also may make it more difficult to obtain control of the
Company.

Under our charter, our
Board of Directors is divided into three classes serving staggered terms, which
will make it more difficult for a hostile bidder to acquire control of us. In
addition, our Board of Directors may, without stockholder action, authorize the
issuance of shares of stock in one or more classes or series, including
preferred stock. Our Board of Directors may, without stockholder action, amend
our charter to increase the number of shares of stock of any class or series
that we have authority to issue. The existence of these provisions, among
others, may have a negative impact on the price of our common shares and may
discourage third party bids for ownership of our Company. These provisions may
prevent any premiums being offered to you for our common shares.

Risks Related to an Investment in
the U.S. Energy Infrastructure Sector

Our focus on the energy
infrastructure sector will subject us to more risks than if we were broadly
diversified.Because we specifically focus on the energy infrastructure sector,
investments in our common shares may present more risks than if we were broadly
diversified over numerous sectors of the economy. Therefore, a downturn in the
U.S. energy infrastructure sector would have a larger impact on us than on a
company that does not concentrate in one sector of the economy. The energy
infrastructure sector can be significantly affected by the supply of and demand
for specific products and services; the supply and demand for crude oil, natural
gas, and other energy commodities; the price of crude oil, natural gas, and
other energy commodities; exploration, production and other capital
expenditures; government regulation; world and regional events and economic
conditions.

Energy infrastructure
companies are subject to variations in the supply and demand of various energy
commodities.A
decrease in the production of natural gas, natural gas liquids, crude oil, coal,
refined petroleum products or other such commodities, or a decrease in the
volume of such commodities available for transportation, mining, processing,
storage or distribution, may adversely impact the financial performance of
companies in the energy infrastructure sector. Production declines and volume
decreases could be caused by various factors, including catastrophic events
affecting production, depletion of resources, labor difficulties, political
events, OPEC actions, environmental proceedings, increased regulations,
equipment failures and unexpected maintenance problems, failure to obtain
necessary permits, unscheduled outages, unanticipated expenses, inability to
successfully carry out new construction or acquisitions, import supply
disruption, increased competition from alternative energy sources or related
commodity prices. Alternatively, a sustained decline in demand for such
commodities could also adversely affect the financial performance of companies
in the energy infrastructure sector. Factors that could lead to a decline in
demand include economic recession or other adverse economic conditions, higher
fuel taxes or governmental regulations, increases in fuel economy, consumer
shifts to the use of alternative fuel sources, changes in commodity prices or
weather. Factors that could lead to a decrease in market demand include a
recession or other adverse economic conditions, an increase in the market price
of the underlying commodity, higher taxes or other regulatory actions that
increase costs, or a shift in consumer demand for such products. Demand may also
be adversely impacted by consumer sentiment with respect to global warming
and/or by any state or federal legislation intended to promote the use of
alternative energy sources such as bio-fuels, solar and wind. Should energy
infrastructure companies experience variations in supply and demand as described
above, the resulting decline in operating or financial performance could impact
the value or quality of our assets.

Many companies in the energy
infrastructure sector are subject to the risk that they, or their customers,
will be unable to replace depleted reserves of energy
commodities.Many
companies in the energy infrastructure sector are either (i) engaged in the
production of natural gas liquids, refined petroleum products, or aggregates
such as crushed stone, sand and gravel, or (ii) are engaged in transporting,
storing, distributing and processing these items on behalf of producers. To
maintain or grow their revenues, many customers of these companies need to
maintain or expand their reserves through exploration of new sources of supply,
through the development of existing sources, through acquisitions, or through
long-term contracts to acquire reserves. The financial performance of companies
in the energy infrastructure sector may be adversely affected if the companies
to which they provide service are unable to cost-effectively acquire additional
reserves sufficient to replace the natural decline.

Energy infrastructure
companies are and will be subject to extensive regulation because of their
participation in the energy infrastructure sector.Companies in the energy infrastructure sector
are subject to significant federal, state and local government regulation in
virtually every aspect of their operations, including how facilities are
constructed, maintained and operated, environmental and safety controls, and the
prices they may charge for the products and services they provide. Various
governmental authorities have the power to enforce compliance with these
regulations and the permits issued under them, and violators are subject to
administrative, civil and criminal penalties, including civil fines, injunctions
or both. Stricter laws, regulations or enforcement policies could be enacted in
the future that likely would increase compliance costs and may adversely affect
the financial performance of companies in the energy infrastructure
sector.

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Energy infrastructure
companies are and will be subject to the risk of fluctuations in commodity
prices.The
operations and financial performance of companies in the energy infrastructure
sector may be directly affected by energy commodity prices, especially those
companies in the energy infrastructure sector owning the underlying energy
commodity. Commodity prices fluctuate for several reasons, including changes in
market and economic conditions, the impact of weather on demand or supply,
levels of domestic production and imported commodities, energy conservation,
domestic and foreign governmental regulation and taxation and the availability
of local, intrastate and interstate transportation systems. Volatility of
commodity prices, which may lead to a reduction in production or supply, may
also negatively impact the performance of companies in the energy infrastructure
sector that are solely involved in the transportation, processing, storing,
distribution or marketing of commodities. Volatility of commodity prices may
also make it more difficult for companies in the energy infrastructure sector to
raise capital to the extent the market perceives that their performance may be
tied directly or indirectly to commodity prices. Historically, energy commodity
prices have been cyclical and exhibited significant volatility. Should energy
infrastructure companies experience variations in supply and demand as described
above, the resulting decline in operating or financial performance could impact
the value or quality of our assets.

Energy infrastructure
companies are and will be subject to the risk of extreme weather
patterns.Extreme
weather patterns, such as prolonged or abnormal seasons, or specific events,
such as hurricanes, could result in significant volatility in the supply of
energy and power. This volatility may create fluctuations in commodity prices
and earnings of companies in the energy infrastructure sector. Moreover, any
extreme weather events, such as hurricanes, could adversely impact the assets
and valuation of our real property assets or investment
securities.

Additional Risks to Common
Stockholders

Our use of leverage increases
the risk of investing in our securities and will increase the costs borne by
common stockholders.Our use of leverage through the issuance of any preferred stock or
debt securities, and any additional borrowings or other transactions involving
indebtedness (other than for temporary or emergency purposes) are or would be
considered senior securities and create risks. Leverage is a speculative
technique that may adversely affect common stockholders. If the return on
securities acquired with borrowed funds or other leverage proceeds does not
exceed the cost of the leverage, the use of leverage could cause us to lose
money.

Our issuance of senior
securities involves offering expenses and other costs, including interest
payments, which are borne indirectly by our common stockholders. Fluctuations in
interest rates could increase interest or dividend payments on our senior
securities, and could reduce cash available for distribution on common stock.
Increased operating costs, including the financing cost associated with any
leverage, may reduce our total return to common stockholders.

Rating agency guidelines
applicable to any senior securities may impose asset coverage requirements,
dividend limitations, voting right requirements (in the case of the senior
equity securities), and restrictions on our portfolio composition and our use of
certain investment techniques and strategies. The terms of any senior securities
or other borrowings may impose additional requirements, restrictions and
limitations that are more stringent than those required by a rating agency that
rates outstanding senior securities. These requirements may have an adverse
effect on us and may affect our ability to pay distributions on common stock and
preferred stock. To the extent necessary, we may redeem our senior securities to
maintain the required asset coverage. Doing so may require that we liquidate
investments at a time when it would not otherwise be desirable to do
so.

In addition, lenders
from whom we may borrow money or holders of our debt securities may have fixed
dollar claims on our assets that are superior to the claims of our stockholders,
and we have granted, and may in the future grant, a security interest in our
assets in connection with our debt. In the case of a liquidation event, those
lenders or note holders would receive proceeds before our stockholders. If the
value of our assets increases, then leveraging would cause the net asset value
attributable to our common shares to increase more than it otherwise would have
had we not leveraged. Conversely, if the value of our assets decreases,
leveraging would cause the net asset value attributable to our common shares to
decline more than it otherwise would have had we not leveraged. Similarly, any
increase in our revenue in excess of interest expense on our borrowed funds
would cause our net income to increase more than it would without the leverage.
Any decrease in our revenue would cause our net income to decline more than it
would have had we not borrowed funds and could negatively affect our ability to
make distributions on our common shares. Our ability to service any debt that we
incur will depend largely on our financial performance and the performance of
our portfolio companies and will be subject to prevailing economic conditions
and competitive pressures.

Sales of our common stock may
put pressure on our stock price.The sale of our common stock (or the perception
that such sales may occur) may have an adverse effect on prices in the secondary
market for our common stock. An increase in the number of common shares
available may put downward pressure on the market price for our common stock and
make it more difficult for stockholders to sell their shares. These sales also
might make it more difficult for us to sell additional equity securities in the
future at a time and price we deem appropriate.

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Additional Risks to Senior
Security Holders

Generally, an investment
in our senior securities is subject to the following risks:

We will be subject to interest
rate risk.Distributions and interest payable on our senior securities are
subject to interest rate risk. To the extent that distributions or interest on
such securities are based on short-term rates, our leverage costs may rise so
that the amount of dividends or interest due to holders of senior securities
would exceed available cash flow. To the extent that any of our leverage costs
are fixed, our leverage costs may increase when our senior securities mature.
This might require us to sell investments at a time when we would otherwise not
do so, which may affect adversely our future ability to generate cash
flow.

Preferred stock will be junior
to any outstanding notes or other borrowings.Preferred stock will be junior in liquidation
and with respect to distribution rights to debt securities and any other
borrowings.

Senior securities
representing indebtedness may constitute a substantial lien and burden on
preferred stock by reason of their prior claim against our income and against
our net assets in liquidation. We may not be permitted to declare dividends or
other distributions with respect to any series of preferred stock unless at such
time we meet applicable asset coverage requirements and the payment of principal
or interest is not in default with respect to any notes or other
borrowings.

Our debt securities,
upon issuance, are expected to be unsecured obligations and, upon our
liquidation, dissolution or winding up, will rank: (1) senior to all of our
outstanding common stock and any outstanding preferred stock; (2) on a parity
with any of our unsecured creditors and any unsecured senior securities
representing our indebtedness; and (3) junior to any of our secured creditors.
Secured creditors of ours may include, without limitation, parties entering into
interest rate swap, floor or cap transactions, or other similar transactions
with us that create liens, pledges, charges, security interests, security
agreements or other encumbrances on our assets.

We may be subject to ratings
and asset coverage risk.To the extent that senior securities are rated, a rating does not
eliminate or necessarily mitigate the risks of investing in our senior
securities, and a rating may not fully or accurately reflect all of the credit
and market risks associated with a security. A rating agency could downgrade the
rating of our shares of preferred stock or debt securities, which may make such
securities less liquid at an auction or in the secondary market, though probably
with higher resulting interest rates. If a rating agency downgrades, or
indicates a potential downgrade to, the rating assigned to a senior security, we
may alter our portfolio or redeem a portion of our senior securities. We may
voluntarily redeem a senior security under certain circumstances to the extent
permitted by its governing documents.

Inflation may negatively
impact our senior securities.Inflation is the reduction in the purchasing power of money resulting
from an increase in the price of goods and services. Inflation risk is the risk
that the inflation adjusted or real value of an investment in preferred stock
or debt securities or the income from that investment will be worth less in the
future. As inflation occurs, the real value of the preferred stock or debt
securities and the dividend payable to holders of preferred stock or interest
payable to holders of debt securities declines.

Additional Risks Related to
Warrants and Subscription Rights

An active public market for
our warrants or subscription rights may not develop.Currently, no public market exists for our
warrants or for subscription rights we may issue. We cannot assure you that one
will develop. We do not currently intend to apply to list the warrants, and may
not list any subscription rights, on any national securities exchange or
automated quotation system.

There may be dilution of the
value of our common shares when our warrants or subscription rights are
exercised or if we issue common shares below book
value.The issuance
of additional common shares upon the exercise of any warrants or subscription
rights, if the warrants or subscription rights are exercised at a time when the
exercise price is less than the book value per share of our common shares will
have a dilutive effect on the value of our common shares.

The warrants or subscription
rights may have no value in bankruptcy.In the event a bankruptcy or reorganization is
commenced by or against us, a bankruptcy court may hold that unexercised
warrants or subscription rights are executory contracts subject to rejection by
us with approval of the bankruptcy court. As a result, holders of warrants or
subscription rights may, even if sufficient funds are available, not be entitled
to receive any consideration or may receive an amount less than they would be
entitled to if they had exercised their warrants or subscription rights prior to
the commencement of any such bankruptcy or reorganization.

As a holder of warrants or
subscription rights, you will not receive distributions on our common
stock.Holders of
warrants or subscription rights will not have the right to receive any
distributions and will not have any voting rights so long as their warrants or
subscription rights are unexercised.

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PART II

ITEM 5. MARKET
FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES
OF EQUITY SECURITIESPrice Range
of Common Stock

Our common shares began
trading on the NYSE under the symbol TTO on February 2, 2007 at a price of
$15.00 per share. Prior to our initial public offering, there was no public
market for our common shares.

The following table sets
forth the range of high and low sales prices of our common shares and the
distributions declared by us for each fiscal quarter for our two most recent
fiscal years:

NAV/
    
    **Price
      Range**
    
    Cash
      Distribution2010
    
    Book Value(1)
    
    High
    
    Low
    
    per Share(2)First
      quarter
    
    
    $
    9.60
    
    
    $
    7.58
    
    $
    6.00
    
    
    $
    0.1300Second quarter
    
    
    $
    8.69
    
    
    $
    7.93
    
    $
    5.27
    
    
    $
    0.1000Third
      quarter
    
    
    $
    9.74
    
    
    $
    6.44
    
    $
    5.10
    
    
    $
    0.1000Fourth quarter
    
    
    $
    10.44
    
    
    $
    7.42
    
    $
    5.40
    
    
    $
    0.10002011First
      quarter
    
    
    $
    10.46
    
    
    $
    8.55
    
    $
    6.79
    
    
    $
    0.1000Second quarter
    
    
    $
    10.66
    
    
    $
    9.27
    
    $
    8.17
    
    
    $
    0.1000Third
      quarter
    
    
    $
    10.62
    
    
    $
    9.02
    
    $
    7.41
    
    
    $
    0.1000Fourth
      quarter(1)
    
    
    $
    9.85
    
    
    $
    8.38
    
    $
    6.59
    
    
    $
    0.1100


|(1) | By
      withdrawing our election to be regulated as a BDC, we are no longer
      regulated by the 1940 Act. Our prospective reporting will conform to other
      commonly used processes of REITs. The primary visibility of this reporting
      will be the decreased emphasis on fair value based NAV to traditional
      historical cost based accounting of book value. This reporting does not
      change the strategy of holding our private investments until an attractive
      liquidity opportunity is presented. In line with our intent and the change
      in our business during the fourth quarter 2011, book value per share is
      shown in place of NAV, and reflects the impact of consolidating the
      operations of Mowood as opposed to reporting it at fair value as in the
      prior periods presented. Net asset value and book value per share is
      generally determined as of the last day in the relevant period and
      therefore may not reflect the net asset value or book value per share on
      the date of the high and low sales prices. The net asset values and book
      value shown are based on outstanding shares at the end of each
      period.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | Represents
      the distribution declared in the specified
  period.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                

The last reported price
for our common stock as of December 31, 2011 was $8.06 per share. As of December
31, 2011, we had 27 stockholders of record.

Dividend
Policy

Our investments in
securities and real property assets generate cash flow to us from which we
expect to pay distributions to stockholders. The Board of Directors will
determine the amount of any distribution we expect to pay our stockholders. A
REIT is generally required to distribute during the taxable year an amount equal
to at least 90% of the REIT taxable income (determined under IRC section
857(b)(2), without regard to the deduction for dividends paid). We intend to
adhere to this requirement in order to qualify as a REIT.

Taxation of our
Distributions

If we elect to be
treated as a REIT, we will be required to make distributions, other than capital
gain distributions, to our stockholders each year in the amount of at least 90%
of our REIT taxable income. We have historically paid, and intend to continue to
pay, subject to adjustment at the discretion of our Board of Directors,
quarterly distributions to our stockholders. Our Board of Directors will
determine the amount of each distribution. Because of the effect of other items,
including depreciation and amortization associated with real estate investments,
distributions, in whole or in part, in any period may constitute a return of
capital for federal tax purposes. On February 6, 2012, our Board of Directors
declared a $0.11 per share distribution to be paid on March 1, 2012 to
stockholders of record on February 22, 2012. There is no assurance that we will
continue to make regular distributions.

Taxation

Currently, as a
corporation, we are obligated to pay federal and state income tax on our taxable
income. Our tax expense or benefit is included in our Consolidated Statements of
Operations. Deferred income taxes reflect the net tax effects of temporary
differences between the carrying amounts of assets and liabilities for financial
reporting purposes and the amounts used for income tax purposes. Based on
current information, we believe we have sufficient net operating losses or other
tax attributes to offset any potential tax expense in 2011. If we find sufficient suitable REIT-qualifying investments and satisfy the REIT requirements throughout our
fiscal year, we expect to make an election to be treated as a REIT for tax purposes for that fiscal year by filing a Form 1120-REIT
on or before March 15of the subsequent fiscal year, or such later date to which we have properly extended filing such
income tax return. We do not currently expect that we will be able to elect to be treated as a REIT for tax purposes for the 2012
fiscal year, but also do not expect that our lack of REIT status will hinder our ability to pay distributions on a quarterly basis. If we
elect REIT status in the future, we will be taxed as a REIT rather than a C
corporation and generally will not pay federal

19

---



income tax on taxable
income that is distributed to our stockholders. Currently, our distributions
from earnings and profits are treated as qualified dividend income (QDI) and
return of capital, with dividends received by corporate shareholders generally
qualifying for the dividends received deduction (DRD). If we elect REIT
status, our distributions from earnings and profits will be treated as ordinary
income and generally will not qualify as QDI and will not be qualifying for
purposes of the DRD. As a REIT, certain dividends related to long term capital
gains may be taxed as capital gains dividends. If we make a REIT election, we
will be subject to a corporate level tax on certain built-in gains on certain
assets if such assets are sold during the 10 year period following conversion.
Built-in gain assets are assets whose fair market value exceeds the REITs
adjusted tax basis at the time of conversion. In addition, a REIT may not have
any earnings and profits accumulated in a non-REIT year. Thus, upon conversion
to a REIT, the putative REIT is generally required to distribute to its
stockholders all accumulated earnings and profits, if any. Such distribution
would be taxable to the stockholders as dividend income, and, as discussed
above, may qualify as qualified dividend income for non-corporate stockholders
and for the dividends received deduction for corporate
stockholders.

Recent Sales of Unregistered
Securities

We did not sell any
securities during the year ended November 30, 2011 that were not registered
under the Securities Act of 1933.

Issuer Purchases of Equity
Securities

We did not repurchase
any shares of our common stock during the year ended November 30,
2011.

Performance
Graphs

The following graph
compares the return on our common stock (TTO) with that of the Wachovia MLP
Total Return Index (WMLPT) and a BDC Peer Group (BDC Peers), for the period
February 2, 2007 to November 30, 2011. The graph assumes that, on February 2,
2007, a $100 investment was made in each of our common stock, WMLPT and the BDC
Peers, and assumes the reinvestment of all cash dividends. The comparisons in
the graph below are based on historical data and are not intended to forecast
future performance of our common stock.



|(1) | Our shares
      began trading on the NYSE on February 2, 2007.                                                                                                                       
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | The BDC
      Peer Group consists of the following closed-end investment companies that
      have elected to be regulated as business development companies under the
      1940 Act:

| | American Capital
      Strategies   | Firsthand Technology
      Value   | Keating Capital
      Inc.      | PennantPark Floating
      Rate  
| | ----------------------------------- | ---------------------------------- | ------------------------------- | ---------------------------------
| | Ameritrans Capital
      Corp.      | Full Circle Capital
      Corp.    | Kohlberg Capital
      Corp.    | PennantPark
      Investment Corp
| | Apollo Investment
      Corp.       | Gladstone Capital
      Corp.      | Main Street Capital
      Corp. | Prospect Capital
      Corp.     
| | Ares Capital
      Corporation      | Gladstone Investment
      Corp.   | MCG Capital
      Corp.         | Saratoga Investment
      Corp.  
| | Blackrock Kelso
      Capital Corp. | Golub Capital BDC
      Inc.       | Medallion Financial
      Corp. | Solar Capital
      Ltd.         
| | Capital Southwest
      Corp.       | GSV Capital
      Corp.            | Medley Capital
      Corp.      | Solar Senior Capital
      Ltd.  
| | Equus Total
      Return            | Harris & Harris
      Group Inc.   | MVC
      Capital               | THL Credit
      Inc.            
| | Fidus Investment
      Group        | Hercules Tech Growth
      Capital | NGP Capital Resources
      Co. | TICC
      Capital               
| | Fifth Street Finance
      Corp.    | Horizon Technology
      Finance   | Oxford Lane Capital
      Corp. | Triangle Capital
      Corp.     

As a result of the
Companys withdrawal of its election to be regulated as a BDC and the
anticipated liquidation of the securities portfolio, the performance comparable
group has also been revised from that shown above to reflect a more appropriate
set of benchmarks. As the Company intends to be treated as a REIT in the future,
and is changing its focus to the acquisition of real property energy
infrastructure assets that are leased backed to operating companies such as
utilities or other energy operators, it was determined that the FTSE NAREIT
Equity REIT Index (FTSE NAREIT), the Dow Jones Utilities Average Index (DJ
UTIL), and the S&P 500 (SPX) are a more relevant set of indices. The
graph assumes that, on February 2, 2007, a $100 investment was made in each of
our common stock, FTSE NAREIT and the SPX, and assumes the reinvestment of all
cash dividends. The comparisons in the graph below are based on historical data
and are not intended to forecast future performance of our common
stock.

20

---





|(1) | Our shares began trading on
      the NYSE on February 2,
2007.
|--- | ---------------------------------------------------------------

ITEM 6. SELECTED
FINANCIAL DATAThe selected
financial data set forth below should be read in conjunction with Managements
Discussion and Analysis of Financial Condition and Results of Operations, and
the financial statements and related notes included in this Annual Report on
Form 10-K. The Companys consolidated financial statements include the accounts
of the Company and its wholly-owned subsidiary, Mowood, LLC (Mowood). See Note
2B in the Notes to Consolidated Financial Statements for further disclosure.
Financial information presented below for the years ended November 30, 2011,
November 30, 2010, November 30, 2009, November 30, 2008 and November 30, 2007
has been derived from our financial statements audited by Ernst & Young LLP,
our independent registered public accounting firm. The historical data is not
necessarily indicative of results to be expected for any future
period.

Results of operations for
the year ended November 30, 2011 and the financial position at November 30, 2011
reflect the consolidation of the Companys wholly-owned subsidiary, Mowood, LLC,
effective September 21, 2011.

|                                                        |  | Year Ended   |            | Year Ended   |  | Year Ended   |            | Year Ended   |  | Year Ended  
|------------------------------------------------------- |  | ------------ | ---------- | ------------ |  | ------------ | ---------- | ------------ |  | ------------
|                                                        |  | November 30, |            | November 30, |  | November 30, |            | November 30, |  | November 30,
|                                                        |  | 2011         |            | 2010         |  | 2009         |            | 2008         |  | 2007        
|Income statement data:                                  |  |              |            |              |  |              |            |              |  |             
|Sales
      revenue                                     |  | $            | 2,161,723  |              |  | $            |           |              |  | $           
|Lease income                                            |  |              | 1,063,740  |              |  |              |           |              |  |             
|Total revenue                                           |  |              | 3,225,463  |              |  |              |           |              |  |             
|Cost of sales                                           |  |              | 1,689,374  |              |  |              |           |              |  |             
|Management fees,
      net of expense reimbursements(1) |  |              | 968,163    |              |  |              | 925,820    |              |  |             
|All other expenses(2)                                   |  |              | 2,038,347  |              |  |              | 972,556    |              |  |             
|Total expenses                                          |  |              | 4,695,884  |              |  |              | 1,898,376  |              |  |             
|Income (loss) from operations(3)                        |  |              | (1,470,421 | )            |  |              | (1,898,376 | )            |  |             
|Realized and
      unrealized gain (loss) on securities |  |              |            |              |  |              |            |              |  |             
|transactions, before income taxes(4)                    |  |              | 4,583,748  |              |  |              | 19,446,071 |              |  |             
|Distributions and dividend income, net                  |  |              | 651,673    |              |  |              | 1,853,247  |              |  |             
|Other
      income                                      |  |              | 40,000     |              |  |              | 38,580     |              |  |             
|Total other income
      (loss)                         |  |              | 5,275,421  |              |  |              | 21,337,898 |              |  |             
|Income (loss)
      before income taxes                 |  |              | 3,805,000  |              |  |              | 19,439,522 |              |  |             
|Current and deferred tax benefit (expense), net(3)      |  |              | (882,857   | )            |  |              | (4,772,648 | )            |  |             
|Net income (loss)                                       |  | $            | 2,922,143  |              |  | $            | 14,666,874 |              |  | $           
|Per common share data:                                  |  |              |            |              |  |              |            |              |  |             
|Distributions to
      common stockholders(5)           |  | $            | 0.41       |              |  | $            | 0.43       |              |  | $           
|Earnings per common share:                              |  |              |            |              |  |              |            |              |  |             
|Basic and diluted                                       |  | $            | 0.32       |              |  | $            | 1.61       |              |  | $           

21

---



|                                           |  | November 30, |            | November 30, |   | November 30, |  | November 30, |            | November 30,
|------------------------------------------ |  | ------------ | ---------- | ------------ | - | ------------ |  | ------------ | ---------- | ------------
|                                           |  | 2011         |            | 2010         |   | 2009         |  | 2008         |            | 2007        
|Balance sheet data:                        |  |              |            |              |   |              |  |              |            |             
|Securities
      investments               |  | $            | 68,894,372 |              | $ | 93,736,230   |  | $            | 82,483,094 |             
|Leased property, net                       |  |              | 13,832,540 |              |   |             |  |              |           |             
|Property and
      equipment, net          |  |              | 3,842,675  |              |   |             |  |              |           |             
|Other assets                               |  |              | 7,717,809  |              |   | 2,305,163    |  |              | 6,994,959  |             
|Total assets                               |  | $            | 94,287,396 |              | $ | 96,041,393   |  | $            | 89,478,053 |             
|                                          
|Long-term debt                             |  |              | 2,279,883  |              |   |             |  |              |           |             
|Other
      liabilities                    |  |              | 1,581,200  |              |   | 562,220      |  |              | 5,181,468  |             
|Total liabilities                          |  |              | 3,861,083  |              |   | 562,220      |  |              | 5,181,468  |             
|Total
      stockholders equity           |  | $            | 90,426,313 |              | $ | 95,479,173   |  | $            | 84,296,585 |             
|Total liabilities and stockholders equity |  | $            | 94,287,396 |              | $ | 96,041,393   |  | $            | 89,478,053 |             
|                                           |  |              |            |              |   |              |  |              |            |             

|(1) | Management fee
      analysis for the years ending:
|--- | ---------------------------------------------------

| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |  | **Nov 30, 2011** |           | **Nov 30, 2010** |  | **Nov 30, 2009** |           | **Nov 30, 2008** |  | **Nov 30,
  2007**
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ---------------- | --------- | ---------------- |  | ---------------- | --------- | ---------------- |  | ------------------
| | Gross Management Fees                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |  | $                | 1,452,245 |                  |  | $                | 1,233,823 |                  |  | $                 
| | Capital Gain
      Incentive Fees Payable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |  |                  |          |                  |  |                  |          |                  |  |                   
| | Expense Reimbursements                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |  |                  | (484,092  | )                |  |                  | (308,003  | )                |  |                   
| | Net Management Fees                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |  | $                | 968,163   |                  |  | $                | 925,820   |                  |  | $                 
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | *The payable for capital gain
      incentive fees is a result of the increase or decrease in the fair value
      of investments and realized gains or losses from investments. Pursuant to
      the Investment Advisory Agreement, the capital gain incentive fee is paid
      annually only if there are realization events and only if the calculation
      defined in the agreement results in an amount due. No capital gain
      incentive fees have been due or payable since the commencement of
      operations.*

|(2) | Other expense
      analysis for the years ending:
|--- | --------------------------------------------------

| |                                             | **Nov 30, 2011** |           | **Nov 30, 2010** |   | **Nov 30, 2009** |  | **Nov 30, 2008** |           | **Nov 30,
  2007**
| | ------------------------------------------- | ---------------- | --------- | ---------------- | - | ---------------- |  | ---------------- | --------- | ------------------
| | Operating Expenses                          | $                | 1,363,654 |                  | $ | 926,937          |  | $                | 911,779   |                   
| | Asset
      Acquisition Expenses            |                  | 638,185   |                  |   |                 |  |                  |          |                   
| | Interest Expense                            |                  | 36,508    |                  |   | 45,619           |  |                  | 627,707   |                   
| | Loss on
      Redemption of Preferred Stock |                  |          |                  |   |                 |  |                  |          |                   
| | Preferred Stock Distributions               |                  |          |                  |   |                 |  |                  |          |                   
| | Total Other Expenses                        | $                | 2,038,347 |                  | $ | 972,556          |  | $                | 1,539,486 |                   
| |                                             |                  |           |                  |   |                  |  |                  |           |                   

|    | The Series A Redeemable Preferred Stock issuance in
      December 2006 was utilized as bridge financing to fund portfolio
      investments and was fully redeemed upon completion of our initial public
      offering in February 2007. Other expenses do not include current and
      deferred income taxes.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(3) | These amounts have been revised to correct the classification of certain deferred tax benefits as described further in Note 15 to the Consolidated Financial Statements.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|(4) | For the year ended November 30, 2007, the Company had
      unrealized appreciation of $10,561,888 (before deferred taxes) and
      realized gains of $260,290 (before deferred taxes). The unrealized
      appreciation was primarily attributable to increases in fair value of the
      Companys private portfolio companies and the realized gains were
      attributable to a sale of a small percent of the Companys interest in
      High Sierra Energy GP, LLC.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|    | For the year ended November 30, 2008, the Company had
      unrealized depreciation of $41,581,120 (before deferred taxes) and
      realized gains of $8,716,197 (before deferred taxes). The unrealized
      depreciation was triggered by write-downs of the Companys public and
      private portfolio holdings; generally resulting from the broad, global
      economic recession, major institution failures and bailouts and the
      accompanying collapse of most major asset class valuations in the latter
      part of the year. The realized gains were attributable to the LONESTAR and
      Millennium realization events and VantaCore debt
  redemption.                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|    | For the year ended November 30, 2009, the Company had
      unrealized appreciation of $24,247,380 (before deferred taxes) and
      realized losses of $23,120,748 (before deferred taxes). The unrealized
      appreciation was driven by increased fair values of portfolio holdings
      resulting from a significant rebound in the MLP sector from the downturn
      in late 2008. During the credit crisis of 2008 and 2009, access to credit
      through the bank market became more restrictive and expensive. During that
      time, the Company was not able to renew its credit facility and liquidated
      a portion of its portfolio holdings in order to pay off the credit
      facility, resulting in the recognition of realized
losses.                                                                                                                                                                                                                                                                                                                                                                            
|    | For the year ended November 30, 2010, the Company had
      unrealized appreciation of $30,564,590 (before deferred taxes) and
      realized losses of $11,118,519 (before deferred taxes). The unrealized
      appreciation was driven by primarily by an increase in the fair value of
      its private holdings, most notably Internal Resource Partners which
      increased approximately $18 million during the year. Quest Midstream
      Partners completed its transformation into a publicly traded C-corp,
      PostRock Energy Corp. (NASDAQ: PSTR) in March 2010. PSTR was a new
      corporation formed for the purpose of wholly owning all three Quest
      entities. Upon closing of the merger, the Company received nearly half a
      million freely tradable common units of PSTR in exchange for its common
      units of Quest Midstream. Subsequently, the stock price declined
      significantly and the Company sold its units in an orderly liquidation,
      resulting in the recognition of realized losses.                                                                                         
|(5) | The character of distributions made during the year may
      differ from the ultimate characterization for federal income tax purposes.
      For the year ended November 30, 2011, the Companys distributions for tax
      purposes were comprised of 100 percent investment income and the source of
      the distributions for book purposes was 100 percent return of capital. For
      the year ended November 30, 2010, the Companys distributions, for book
      and tax purposes, were comprised of 100 percent return of capital. For the
      year ended November 30, 2009, the Companys distributions, for book and
      tax purposes, were comprised of 100 percent return of capital. For the
      year ended November 30, 2008, the Companys distributions, for book
      purposes, were comprised of 100 percent return of capital, and for tax
      purposes were comprised of 3.2 percent investment income and 96.8 percent
      return of capital. For the year ended November 30, 2007, the Companys
      distributions, for book and tax purposes, were comprised of 100 percent
      return of capital.

22

---



ITEM 7.
MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONSAll statements
contained herein, other than historical facts, constitute forward-looking
statements. These statements may relate to, among other things, future events
or our future performance or financial condition. In some cases, you can
identify forward-looking statements by terminology such as may, might,
believe, will, provided, anticipate, future, could, growth,
plan, intend, expect, should, would, if, seek, possible,
potential, likely or the negative of such terms or comparable. These
forward-looking statements involve known and unknown risks, uncertainties and
other factors that may cause our actual results, levels of activity, performance
or achievements to be materially different from any anticipated results, levels
of activity, performance or achievements expressed or implied by such
forward-looking statements. For a discussion of factors that could cause our
actual results to differ from forward-looking statements contained herein,
please see the discussion under the heading Risk Factors in Part I, Item 1A.
of this report.

We may experience
fluctuations in our operating results due to a number of factors, including the
return on our equity investments, the interest rates payable on our debt
investments, the default rates on such investments, the level of our expenses,
variations in and the timing of the recognition of realized and unrealized gains
or losses, the degree to which we encounter competition in our markets and
general economic conditions. As a result of these factors, results for any
period should not be relied upon as being indicative of performance in future
periods.

Performance Review

Our stock price increased
approximately 7.1 percent this year, closing at $7.80 on November 30, 2011
compared to $7.28 on November 30, 2010. This contributed to a total investment
return based on market value and assuming reinvestment of distributions of
approximately 12.6 percent for the year ended November 30, 2011. The fair value
of our investment securities, excluding cash equivalents, was approximately
$68.9 million at November 30, 2011, with approximately $41.9 million in private
securities and approximately $27.0 million in publicly-traded
securities.

Results of Operations

Comparison of the Years Ended
November 30, 2011, November 30, 2010 and November 30, 2009

Revenue:Revenue for the year ended November 30, 2011 was
$3,225,463. This represents sales revenue from our wholly owned subsidiary,
Mowood, for the period from September 21, 2011 through November 30, 2011 as well
as lease income from our Public Service Company of New Mexico investment during
the year. Our Public Service Company of New Mexico investment was made in June
2011 and the results of Mowoods operations were consolidated for the period
from September 21, 2011 through November 30, 2011 and, thus, there are no
comparable revenues for the years ended November 30, 2010 and November 30, 2009.
Amounts related to our investment securities previously reported as revenue in
prior periods are now reflected below Income (Loss) from Operations. Investment
income as presented in our 2010 10-K is now reflected in the line items
Distributions and dividend income, net and other income. As we do not plan
to make additional investments in securities (other than short term, highly
liquid investments to be held pending acquisition of real property assets) and
intend to liquidate our securities portfolio in an orderly manner, investments
are no longer considered part of our operations, consistent with our intentions
to invest in real property assets which can be leased.

Other
Income:Other income
represents our earnings on our portfolio of trading securities and other equity
securities that are reported at fair value under the fair value option. Other
income for the year ended November 30, 2011 totaled $5,275,421. This represents
a decrease of $16,062,477 as compared to total other income of $21,337,898 for
the year ended November 30, 2010. The decrease is due to lower realized and
unrealized gains on our securities portfolio and lower securities distributions
and dividends received. Other income for the year ended November 30, 2010
reflected an increase of $18,406,735 as compared to total other income of
$2,931,163 for the year ended November 30, 2009. The increase was primarily due
to higher realized and unrealized gains on our securities portfolio.

The following table shows
the gross income received from our investment securities on a cash basis, less
the amounts that were comprised of return of capital:

|                                                |  | Year Ended   |            | Year Ended   |  | Year        
|----------------------------------------------- |  | ------------ | ---------- | ------------ |  | ------------
|                                                |  | November 30, |            | November 30, |  | November 30,
|                                                |  | 2011         |            | 2010         |  | 2009        
|Income received from investment securities      |  | $            | 3,568,128  |              |  | $           
|Less return of
      capital on distributions   |  |              | (2,916,455 | )            |  |             
|Income received from investment securities, net |  | $            | 651,673    |              |  | $           
|                                                |  |              |            |              |  |             

23

---



|Expenses:              
|-----------------------
|Year Ended             
|November 30, 2011      
|November 30,
      2010
|Variance               
|                       

The increase in expenses
from 2010 to 2011 was primarily related to cost of sales and other operating
expenses of ourconsolidated wholly owned subsidiary, Mowood,
reflected for the period from September 21, 2011 through November 30, 2011 and
costs pertaining to our asset acquisition in June 2011 and related depreciation
expense that was recognized during the year ended November 30, 2011. The
decrease in expenses from the year ended November 30, 2009 to the year ended
November 30, 2010 is primarily attributed to lower base management fees due to a
decrease in the fair value of our securities portfolio, an increase in the
expense reimbursement by the Adviser, and significantly lower leverage costs.

Net Income:Net income for the year ended
November 30, 2011 was $2,922,143, compared to $14,666,874 and $10,994 for the
years ended November 30, 2010 and 2009, respectively. The variance in net income
is related to the changes in revenue and expenses as described above.

Distributions:The
following table sets forth distributions for the three years ended November 30,
2011, November 30, 2010 and November 30, 2009.

Period
    
    Amount
    
    Period
    
    Amount
    
    Period
    
    Amount2011
    
    
    
    
    2010
    
    
    
    
    2009Fourth
      Quarter
    
    $
    0.1100
    
    Fourth
      Quarter
    
    $
    0.1000
    
    Fourth
      Quarter
    
    $
    0.1300Third Quarter
    
    $
    0.1000
    
    Third Quarter
    
    $
    0.1000
    
    Third Quarter
    
    $
    0.1300Second
      Quarter
    
    $
    0.1000
    
    Second
      Quarter
    
    $
    0.1000
    
    Second
      Quarter
    
    $
    0.1300First Quarter
    
    $
    0.1000
    
    First Quarter
    
    $
    0.1300
    
    First Quarter
    
    $
    0.2300


Private Company
Update

High Sierra Energy, LP and High
Sierra Energy, GP (High Sierra)High Sierras fair value increased approximately $4.2 million since
November 30, 2010. In March 2011, High Sierra closed on a new $215 million,
3-year committed senior secured credit facility led by BNP Paribas. The new
facility financed the buyout of High Sierras minority partners at Anticline
Disposal, resulting in High Sierra owning 100 percent of the membership
interests of that business. In June 2011, High Sierra completed the sale of its
70 percent owned subsidiary, Monroe Gas Storage Company, LLC (Monroe), which
operates a natural gas storage facility in northeastern Mississippi, to Cardinal
Gas Storage Partners LLC. High Sierra also acquired the assets of Marcum
Midstream 1995-2 Business Trust and Marcum Midstream 1995-EC Holdings, LLC
(collectively Marcum). The company continues to divest of its non-core assets
and during the fourth quarter completed the sale of Asgard Energy. High Sierra
did not make cash distributions to its LP and GP unit holders during our first
two fiscal quarters of the year. In the third quarter, High Sierra returned to
paying cash distributions at $0.15 per unit and increased the per unit payout to
$0.30 in our fourth quarter. In the coming year we expect High Sierra to
maintain its current level of cash distributions with modest room for
growth.

Lightfoot Capital Partners LP and
Lightfoot Capital Partners GP LLC (Lightfoot)In June 2011, we purchased an 8.2 percent
ownership interest in Magnetar MLP Investment, LP (Magnetar MLP) for net
consideration of $9.9 million. The Magnetar MLP investment represented an
indirect investment into Lightfoot Capital Partners, LP (Lightfoot), which
owned 83.5 percent of the outstanding limited partner units of Arc Terminals LP
(Arc) and 100 percent of Arc Terminals GP, which also included a 2.0 percent
limited partnership interest. At the time of investment, Lightfoot also held
approximately $60 million in cash available for new investments. Arc provides
storage and delivery services for petroleum, petrochemical and chemical products
to customers under long-term storage and throughput contracts. In October 2011,
Magnetar MLP sold a substantial portion of its interest in Lightfoot Capital
Partners LP and Lightfoot Capital Partners GP to provide liquidity to certain
original investors in the fund. As part of this transaction we elected to
receive direct ownership interests in Lightfoot Capital Partners, LP (6.72%) and
Lightfoot Capital Partners GP LLC (1.52%). Immediately following this
transaction LCP invested its remaining cash in a minority interest in a
Liquefied Natural Gas facility located in Mississippi. The decrease in value
since August 31, 2011 (approximately $500,000) was due in large part to the
anticipated expenses of potential acquisitions and capital market events in the
coming year. The addition of the LNG facility and LCPs existing refined product
storage assets should provide for growing distributions in the
future.

24

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VantaCore Partners LP
(VantaCore)VantaCores
fair value decreased approximately $7.2 million since November 30, 2010.
VantaCore was unable to meet its minimum quarterly cash distribution (MQD)
throughout this past year. Common and preferred unitholders elected to receive a
small percentage of the MQD in cash with the remainder paid in newly issued
preferred units. VantaCore reported year-to-date EBITDA below budget, with the
Southern Aggregates property in Louisiana continuing to fall short. In August
2011, VantaCore completed its acquisition of Cherry Grove Quarry in Todd County,
Kentucky and a milling machine. We invested an additional $1.2 million in
VantaCore in August 2011 in exchange for newly issued Preferred B units to
provide a portion of the funding needed for the acquisition. Although VantaCore
has done a better job of meeting expectations, we continue to lower our EBITDA
expectations for 2012 due to the economic outlook in our territories which
contributed to the reduction in fair value for VantaCore, particularly in the
fourth quarter. We do believe that the fair value of VantaCore will ultimately
increase as the construction and housing markets improve, although the timing
and extent of such improvement in unknown. Until that time, VantaCore continues
to look for small acquisitions and operationalimprovements at its existing
facilities.

Mowood, LLC (Mowood)  Wholly
Owned SubsidiaryAs a
result of our withdrawal to be regulated as a BDC, we no longer prepare our
financials as an investment company but rather as a general corporate entity and
therefore began consolidating the operations of Mowood in the fourth quarter
2011. Lincoln Partners Advisors, LLC (an independent valuation firm) prepared a
positive assurance valuation of our Mowood equity investment as of November 30,
2011 even though the valuation is unaudited and not used as the carrying value
in the consolidated financial statements. The resulting valuation increased
slightly from that which was reported last quarter. In 2012 we expect Mowood to
meet and slightly exceed 2011 EBITDA.

Below is a summary of the
fair values of the other equity securities that we held at November 30, 2011 as
they compare to the fair values at November 30, 2010.

|                        |  | Fair Value at           |            | Fair Value at          
|----------------------- |  | ----------------------- | ---------- | -----------------------
|Portfolio
      Company |  | November 30,
      2011 |            | November 30,
      2010
|High Sierra             |  | $                       | 25,512,814 |                        
|Lightfoot               |  |                         | 9,536,390  |                        
|VantaCore               |  |                         | 6,750,526  |                        
|Lonestar                |  |                         | 57,000     |                        

Basis of Presentation

The consolidated financial
statements include Tortoise Capital Resources Corporation and its wholly-owned
portfolio company, Mowood, LLC (Mowood). All significant intercompany accounts
and transactions are eliminated upon consolidation.

Critical Accounting PoliciesThe financial
statements included in this report are based on the selection and application of
critical accounting policies, which require management to make significant
estimates and assumptions. Critical accounting policies are those that are both
important to the presentation of our financial condition and results of
operations and require managements most difficult, complex or subjective
judgments. The preparation of the consolidated financial statements in
conformity with U.S. generally accepted accounting principles (GAAP) requires
management to make estimates and assumptions that affect the reported amount of
assets and liabilities, recognition of distribution income and disclosure of
contingent assets and liabilities at the date of the consolidated financial
statements. Actual results could differ from those estimates. Note 2 to the
Consolidated Financial Statements, included in this report, further details
information related to our significant accounting policies.

Investment
SecuritiesOur investments
in securities are classified as either trading or other equity
securities:

- Trading securities  our publicly
  traded equity securities are classified as trading securities and are reported
  at fair value because we intend to sell these securities in order to acquire
  real asset investments.
- Other equity securities represent
  interests in private companies for which we have elected to report these at
  fair value under  the fair value option.

Securities transactions are
accounted for on the date the securities are purchased or sold (trade date).
Realized gains and losses are reported on an identified cost basis.

Our investment securities
are primarily in illiquid securities of privately-held companies that are
generally subject to restrictions on resale, have no established trading market
and are fair valued on a quarterly basis. Because of the inherent uncertainty of
valuation, the fair values of such securities, which are determined in
accordance with procedures approved by our Board of Directors, may differ
materially from the values that would have been used had a ready market existed
for the investments.

25

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Long-Lived Assets and
IntangiblesProperty and
equipment are stated at cost less accumulated depreciation. Depreciation is
computed using the straight-line method over the estimated useful lives of the
assets ranging from five to twenty years. Expenditures for repairs and
maintenance are charged to operations as incurred, and improvements, which
extend the useful lives of assets, are capitalized and depreciated over the
remaining estimated useful life of the asset.

We initially record
long-lived assets at their acquisition cost, unless the transaction is accounted
for as a business combination. If the transaction is accounted for as a business
combination, we allocate the purchase price to the acquired tangible and
intangible assets and liabilities based on their estimated fair values. We
determine the fair values of assets and liabilities based on discounted cash
flow models using current market assumptions, appraisals, recent transactions
involving similar assets or liabilities and/or other objective evidence, and
depreciates the asset values over the estimated remaining useful
lives.

In connection with these
transactions, we may acquire long-lived assets that are subject to an existing
lease contract with the seller or other lessee party and we may assume
outstanding debt of the seller as part of the consideration paid. If, at the
time of acquisition, the existing lease or debt contract is not at current
market terms, we will record an asset or liability at the time of acquisition
representing the amount by which the fair value of the lease or debt contract
differs from its contractual value. Such amount is then amortized over the
remaining contract term as an adjustment to the related lease revenue or
interest expense.

Revenue
RecognitionSpecific
policies for our revenue and other income items are as follows:

- *Sales Revenue* Omega, acting as a principal, provides for
  transportation services and natural gas supply for its customers on a firm
  basis. In addition, Omega is paid fees for the operation and maintenance of
  its pipeline, including expansion of the pipeline. Omega is responsible for
  the coordination, supervision and quality of the expansions while actual
  construction is generally performed by third party contractors. Revenues
  related to natural gas distribution are recognized upon delivery of natural
  gas and upon the substantial performance of management and supervision
  services related to the expansion of the natural gas distribution system.
- *Dividends and distributions from investments* Dividends and distributions from investments
  are recorded on their ex-dates and are reflected as other income within the
  accompanying Consolidated Statements of Income. Distributions received from
  our investments generally are comprised of ordinary income, capital gains and
  return of capital. We record investment income, capital gains and return of
  capital based on estimates made at the time such distributions are received.
  Such estimates are based on information available from each company and/or
  other industry sources. These estimates may subsequently be revised based on
  information received from the entities after their tax reporting periods are
  concluded, as the actual character of these distributions is not known until
  after our fiscal year end.
- *Realized and unrealized gains (losses) on trading securities and other
  equity securities* Changes in the
  fair values of the Companys securities during the period reported and the
  gains or losses realized upon sale of securities during the period are
  reflected as other income within the accompanying Consolidated Statements of
  Income.
- *Lease Income* Income related
  to our leased property is recognized on a straight-line basis over the term of
  the lease when collectability is reasonably assumed. Rental payments on the
  leased property are typically received on a semi-annual basis and are included
  as lease income within the accompanying Consolidated Statements of
  Income.

Cost of
SalesIncluded in our cost
of sales are the amounts paid for gas and propane that are delivered to
customers as well as the cost of material and labor related to the expansion of
the natural gas distribution system.

Federal and State Income
TaxationCurrently, as a
corporation, we are obligated to pay federal and state income tax on our taxable
income. Our tax expense or benefit is included in the Consolidated Statements of
Operations. Deferred income taxes reflect the net tax effects of temporary
differences between the carrying amounts of assets and liabilities for financial
reporting purposes and the amounts used for income tax purposes. Based on
current information, we believe we have sufficient net operating losses or other
tax attributes to offset any potential significant tax expense in 2011.

If we elect REIT status in
the future, we will be taxed as a REIT rather than a C corporation and generally
will not pay federal income tax on taxable income that is distributed to our
stockholders. Before withdrawal of the BDC election, our distributions from
earnings and profits were treated as qualified dividend income (QDI) and
return of capital. Following the withdrawal, and assuming we subsequently elect
REIT status, our distributions from earnings and profits will be treated as
ordinary income and generally will not qualify as QDI. If we do not elect or do
not qualify as a REIT, with respect to years prior to 2013, our distributions
would continue to be treated as QDI and return of capital. Thereafter, under
existing law, our distributions would be treated as ordinary income and return
of capital.

26

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Liquidity and Capital
ResourcesWe entered
into a 180-day rolling evergreen margin loan facility with Bank of America, N.A.
on November 30, 2011. The terms of the agreement provide for a $10,000,000
facility that is secured by certain of our assets. Outstanding balances
generally will accrue interest at a variable rate equal to one-month LIBOR plus
0.75 percent and unused portions of the facility will accrue a fee equal to an
annual rate of 0.25 percent.

On October 29, 2011, Mowood
entered into a revolving note payable with a financial institution with a
maximum borrowing base of $1,250,000. Borrowings on the note are secured by all
of Mowoods assets. Interest accrues at LIBOR, plus a 400 percent margin (4.25
percent at November 30, 2011), is payable monthly, with all outstanding
principal and accrued interest payable on October 29, 2012. There are no
outstanding borrowings under this agreement at November 30, 2011. The agreement
contains various restrictive covenants, with the most significant relating to
minimum consolidated fixed charge ratio, the incidence of additional
indebtedness, member distributions, extension of guaranties, future investments
in other subsidiaries and change in ownership.

On January 25, 2012, we
filed an amendment to our shelf registration statement on Form S-3 with the
Securities and Exchange Commission. When effective, the universal shelf
registration will allow us to prudently raise additional capital. While we have
had the ability to utilize various forms of leverage  including a credit
facility, senior notes and other borrowings, as well as preferred stock 
historically, we have only been able to access leverage at attractive costs
through a credit facility. During the credit crisis of late 2008 and 2009,
access to credit through the bank market became more restrictive and expensive.
During that time, we were not able to renew our credit facility and we
liquidated a portion of our portfolio holdings in order to repay the credit
facility in full. We believe lenders are more reluctant to lend against equity
investments in private companies than to entities that invest in real assets.
Consistent with our initial investment strategy, we intend to utilize leverage
to enhance the total returns of our portfolio.

We expect to have greater
flexibility in issuing securities with common equity participation features
(such as warrants and convertible notes) and/or additional classes of stock
(such as convertible preferred) in order to facilitate capital formation now
that we are no longer subject to the restrictions of the 1940 Act. We also hold
publicly listed MLPs which can be liquidated in order to fund future
acquisitions. We expect to hold our private investments until a natural
liquidity event is presented to each company.

Contractual
ObligationsThe
following table summarizes our significant contractual payment obligations as of
November 30, 2011.

Payments due by period****
    
    More thanTotal
    
    Less than 1
    year
    
    1-3 years
    
    3-5 years
    
    5 yearsLong-term Debt(1)
    
    $
    2,188,000
    
    $
    2,188,000
    
    $
    
    
    $
    
    
    $
    Operating Lease
      Obligations
    
    
    107,550
    
    
    79,908
    
    
    27,642
    
    
    
    
    
    $
    2,295,550
    
    $
    2,267,908
    
    $
    27,642
    
    $
    
    
    $
    


|(1) | At November 30,
      2011, the principal balance outstanding on the debt assumed in the Eastern
      Interconnect Project was $2,188,000. Principal payments will be made on a
      semi-annual basis through the maturity date of October 1,
    2012.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Eastern Interconnect Project
Investment (EIP)The Companys investment in EIP is leased under net operating leases with
various terms. As of November 30, 2011, approximately 100 percent of the
Companys leased property, based on the gross book value of real estate
investments, was leased to Public Service Company of New Mexico (PNM). PNM is
referred to as the Major Tenant. Approximately 33 percent of the Companys total
revenue for the year ended November 30, 2011 was derived from the Major Tenant.

In view of the fact that
the Major Tenant leases a substantial portion of the Companys net leased
property which is a significant source of revenues and operating income, its
financial condition and ability and willingness to satisfy its obligations under
its lease with the Company, have a considerable impact on the results of
operation and the Companys ability to service its indebtedness.

The Major Tenant is
currently subject to the reporting requirements of the Securities Exchange Act
of 1934, as amended, and is required to file with the SEC annual reports
containing audited financial statements and quarterly reports containing
unaudited financial statements. The audited financial statements and unaudited
financial statements of the Major Tenant can be found on the SECs website at
www.sec.gov. The Company makes no representation as to the accuracy or
completeness of the audited and unaudited financial statements of the Major
Tenant but has no reason not to believe the accuracy or completeness of such
information. In addition, the Major Tenant has no duty, contractual or
otherwise, to advise the Company of any events that might have occurred
subsequent to the date of such financial statements which could affect the
significance or accuracy of such information. None of the information in the
public reports of the Major Tenant that are filed with the SEC is incorporated
by reference into, or in any way form part of this filing.

27

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Off-Balance Sheet
ArrangementsWe do
not have any off-balance sheet arrangements that have or are reasonably likely
to have a current or future effect on our financial condition, changes in
financial condition, revenues or expenses, results of operations, liquidity,
capital expenditures, or capital resources.

StrategyIn
2007, 2009 and 2010 the IRS issued three separate private letter rulings that
defined certain energy infrastructure assets as real estate assets for tax
purposes. The potential qualifying real estate assets in the energy
infrastructure sector are electric transmission and distribution systems,
pipeline systems and storage systems and systems used to transfer substances
between modes of transportation, also known as terminaling systems. We refer to
such REIT-qualifying assets herein as real property assets. While private
letter rulings provide insight into the current thinking of the IRS on tax
issues, such rulings may only be relied upon by the taxpayer to whom they were
issued.

We do not plan to make
additional investments in securities (other than short-term, highly liquid
investments to be held pending acquisition of real property assets) and intend
to liquidate our securities portfolio in an orderly manner. If we find
sufficient suitable REIT-qualifying investments during 2012 and satisfy the REIT
requirements throughout 2012, we expect to make an election to be treated as a
REIT for tax purposes for 2012 by filing a Form 1120-REIT on or before March 15,
2013,or such later date to which we have properly extended filing such income
tax return. The REIT requirements that we must meet are discussed in detail
below, but the principal challenge for us will be meeting the requirement that a
substantial percentage of our assets be REIT-qualifying investments that produce
REIT qualifying income. Our effort to meet that requirement will be accelerated
if: (i) we are able to readily identify appropriate opportunities to liquidate
our securities portfolio, or (ii) we are able to raise capital to fund new
acquisitions. In either event, we will need to have identified and be able to
consummate an adequate number of REIT-qualifying investments meeting our
investment criteria. Subject to certain limitations, we may be able to
accelerate satisfying the REIT requirements by holding non-REIT qualifying
investments, including certain private equity investments, through taxable REIT
subsidiaries. We do not currently have any agreements or binding letters of
intent for such investments. These opportunities are in a preliminary stage of
review, and consummation of any of these opportunities depends on a number of
factors beyond our control. There can be no assurance that any of these
acquisition opportunities will result in consummated transactions. Regardless of
our tax status, an investment in us will not result in Unrelated Business
Taxable Income (UBTI).

Performance
Measurement

In the past, we have
provided investors with a measure of cash flow from operations, labeled
distributable cash flow. Prospectively we intend to provide standard performance
measures utilized by REITs including Funds from Operations (FFO) and Adjusted
Funds from Operations (AFFO).

As defined by the National
Association of Real Estate Investment Trusts (NAREIT), FFO represents net
income, plus depreciation and amortization, and after adjustments for
unconsolidated partnerships and joint ventures. It was intended to be a standard
supplemental measure of REIT operating performance that excluded historical cost
depreciation from  or added it back to  GAAP net income. Since introduction
of the definition, the term has come to be widely used by REITs.

AFFO is another non-GAAP
metric which makes adjustments for certain non-operating and non-cash items
included in the calculation of FFO such as impairment charges, acquisition fees
and mark to market adjustments. We believe that AFFO allows securities analysts,
investors and other interested parties to evaluate current period results to
results prior to acquisitions.

Our objective is to
maximize long-term value for shareholders. To achieve this goal, we target
annualized total returns of 8 to 10 percent from our current operations and
assets that we acquire over the long term. There is no assurance that our
targets will be met in any particular period.

ITEM 8. FINANCIAL STATEMENTS
AND SUPPLEMENTARY DATAOur financial
statements and financial statement schedules are set forth beginning on page F-1
in this Annual Report and are incorporated herein by reference.

28

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ITEM 9A. CONTROLS AND
PROCEDURES

Disclosure Controls and Procedures

The Company maintains disclosure controls and procedures that are designed to provide reasonable assurance
that information required to be disclosed in the Company’s reports under the Securities Exchange Act of 1934, as amended
(the “Exchange Act”), is recorded, processed, summarized and reported within the time periods specified in the SEC’s
rules and forms, and that such information is accumulated and communicated to management, including the Company’s Chief Executive
Officer (“CEO”) and Chief Financial Officer (“CFO”), as appropriate, to allow timely decisions regarding
required disclosure. In designing and evaluating the disclosure controls and procedures, management recognizes that any controls
and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control
objectives and management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible
controls and procedures.

In connection with the preparation of the Annual Report on Form 10-K, an evaluation is performed under the supervision and with the participation of the Company's management, including the CEO and CFO, of the effectiveness of the design and operation of the Company's disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act). Based on that evaluation, the Company's CEO and CFO conclude whether the Company's disclosure controls and procedures are effective as of the reporting date at the reasonable assurance level.

In connection with this Annual Report on Form 10-K for the year ended November 30, 2011, an evaluation was
performed of the effectiveness of the design and operation of the Company’s disclosure controls and procedures as of November
30, 2011. Based on that evaluation, the Company’s CEO and CFO concluded that the disclosure controls and procedures were
effective as of November 30, 2011 at the reasonable assurance level.

Management’s Report on Internal Control Over Financial Reporting

Management of the Company is responsible for establishing and maintaining adequate internal control over financial
reporting, as defined in Rule 13a-15(f) under the Exchange Act. The Company’s internal control over financial reporting is
a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial
statements for external purposes in accordance with generally accepted accounting principles. Because of its inherent limitations,
internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness
to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree
of compliance with the policies or procedures may deteriorate.

Management conducts an evaluation and assesses the effectiveness of the Company’s internal control over
financial reporting as of the reporting date. In making its assessment of internal control over financial reporting, management
uses the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) in Internal
Control-Integrated Framework.

A material weakness is a control deficiency, or combination of control deficiencies, that result in more than
a remote likelihood that a material misstatement of the annual or interim financial statements will not be prevented or detected.
As of November 30, 2011, management conducted an evaluation and assessed the effectiveness of the Company’s internal control
over financial reporting. Based on its evaluation, management concluded that the Company’s internal control over financial
reporting was effective as of November 30, 2011.  Ernst & Young LLP, the Company’s independent registered
public accounting firm, has audited the consolidated financial statements of the Company for the year ended November 30, 2011,
and has also issued an audit report dated February 13, 2012, on the effectiveness of the Company’s internal control
over financial reporting as of November 30, 2011, which is included in this Annual Report on Form 10-K.

Changes in Internal Control Over Financial Reporting

There have been no changes in the Company’s internal control over financial reporting during the most
recently completed fiscal quarter that have materially affected, or are reasonably likely to materially affect, the Company’s
internal control over financial reporting.

29

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REPORT OF INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and
ShareholdersTortoise Capital Resources Corporation

We have audited Tortoise Capital
Resources Corporation internal control over financial reporting as of November
30, 2011, based on criteria established in Internal ControlIntegrated Framework
issued by the Committee of Sponsoring Organizations of the Treadway Commission
(the COSO criteria). Tortoise Capital Resources Corporations management is
responsible for maintaining effective internal control over financial reporting,
and for its assessment of the effectiveness of internal control over financial
reporting included in the accompanying Managements Annual Report on Internal
Control over Financial Reporting. Our responsibility is to express an opinion on
the companys internal control over financial reporting based on our
audit.

We conducted our audit in accordance
with the standards of the Public Company Accounting Oversight Board (United
States). Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether effective internal control over financial
reporting was maintained in all material respects. Our audit included obtaining
an understanding of internal control over financial reporting, assessing the
risk that a material weakness exists, testing and evaluating the design and
operating effectiveness of internal control based on the assessed risk, and
performing such other procedures as we considered necessary in the
circumstances. We believe that our audit provides a reasonable basis for our
opinion.

A companys internal control over
financial reporting is a process designed to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of
financial statements for external purposes in accordance with generally accepted
accounting principles. A companys internal control over financial reporting
includes those policies and procedures that (1) pertain to the maintenance of
records that, in reasonable detail, accurately and fairly reflect the
transactions and dispositions of the assets of the company; (2) provide
reasonable assurance that transactions are recorded as necessary to permit
preparation of financial statements in accordance with generally accepted
accounting principles, and that receipts and expenditures of the company are
being made only in accordance with authorizations of management and directors of
the company; and (3) provide reasonable assurance regarding prevention or timely
detection of unauthorized acquisition, use or disposition of the companys
assets that could have a material effect on the financial statements.

Because of its inherent limitations,
internal control over financial reporting may not prevent or detect
misstatements. Also, projections of any evaluation of effectiveness to future
periods are subject to the risk that controls may become inadequate because of
changes in conditions, or that the degree of compliance with the policies or
procedures may deteriorate.

In our opinion, Tortoise Capital
Resources Corporation maintained, in all material respects, effective internal
control over financial reporting as of November 30, 2011, based on the COSO
criteria.

We also have audited, in accordance
with the standards of the Public Company Accounting Oversight Board (United
States), the consolidated balance sheets of Tortoise Capital Resources
Corporation (the Company) as of November 30, 2011 and 2010, and the related
consolidated statements of income, equity, and cash flows for each of the three
years in the period ended November 30, 2011 and our report dated February 13,
2012, except for Note 15, as to which the date is April 27, 2012, expressed an unqualified opinion thereon.

/s/Ernst &
      Young LLP


Kansas City, Missouri  February 13,
2012

30

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Oversight and
Monitoring

As part of our internal control
processes; we monitor, on an ongoing basis, compliance by tenants with their
lease obligations and other factors that could affect the financial performance
of any of our properties. Monitoring involves receiving assurances that each
tenant has paid real estate taxes, assessments and other expenses relating to
the properties it occupies and confirming that appropriate insurance coverage is
being maintained by the tenant. We review financial statements of tenants and
undertake regular physical inspections of the condition and maintenance of
properties. Additionally, we periodically analyze each tenants financial
condition, the industry in which each tenant operates and each tenants relative
strength in its industry. In addition, monitoring may be accomplished by
attendance at Board of Directors meetings, the review of periodic operating and
financial reports, an analysis of capital expenditure plans as they relate to
the owned assets, and periodic consultations with engineers, geologists and
other experts. The performance of each asset will be periodically compared to
performance of similarly sized companies with comparable assets and businesses
to assess performance relative to peers. Other monitoring activities are
expected to provide the necessary access to monitor compliance with existing
covenants, enhance ability to make qualified valuation decisions, and assist in
the evaluation of the nature of the risks involved in the various components of
the portfolio.

31

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PART IV

ITEM 15. EXHIBITS
AND FINANCIAL STATEMENT SCHEDULESThe following documents are filed as part of this Annual Report on Form
10-K:

| | 1. |  | The Financial
      Statements listed in the Index to Financial Statements on Page
    F-1.
| | -- |  | -------------------------------------------------------------------------------------------
| |    |  |                                                                                            
| | 2. |  | The Exhibits listed
      in the Exhibit Index below.                                      

|ExhibitNo. |  | Description of
    Document                                                                                                                                                             
|---------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|*31.1*     |  | Certification by Chief
      Executive Officer pursuant to Exchange Act Rule 13a-14(a), as adopted
      pursuant to Section 302 of the Sarbanes-Oxley Act of 2002filed
      herewith.
|           |  |                                                                                                                                                                                         
|*31.2*     |  | Certification by Chief
      Financial Officer pursuant to Exchange Act Rule 13a-14(a), as adopted
      pursuant to Section 302 of the Sarbanes-Oxley Act of 2002filed
      herewith.

32

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|INDEX TO FINANCIAL
      STATEMENTS
|-----------------------------------

|                                                                                                     |  | Page
|---------------------------------------------------------------------------------------------------- |  | ----
|                                                                                                     |  |     
|Report of Independent Registered Public Accounting
      Firm                                        |  | F-2 
|Consolidated Balance Sheets for the years ended November 30,
      2011, November 30, 2010           |  |     
|and November 30,
      2009                                                                          |  | F-3 
|Consolidated Statements of Income as of November
      30, 2011 and November 30, 2010                |  | F-4 
|Consolidated Statements of Equity for the years ended
      November 30, 2011, November 30, 2010     |  |     
|and November 30,
      2009                                                                          |  | F-5 
|Consolidated Statements of Cash Flows for the years
      ended November 30, 2011, November 30, 2010 |  |     
|and November 30,
      2009                                                                          |  | F-6 
|Notes to Consolidated Financial Statements                                                           |  | F-7 
|Additional Information (Unaudited)                                                                   |  | F-20
|EXHIBIT 31.1                                                                                         |  |     
|EXHIBIT 31.2                                                                                         |  |     

F-1

---



REPORT OF
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and
ShareholdersTortoise Capital Resources Corporation

We have audited the
accompanying consolidated balance sheets of Tortoise Capital Resources
Corporation (the Company) as of November 30, 2011 and 2010, and the related
consolidated statements of income, equity, and cash flows for each of the three
years in the period ended November 30, 2011. These financial statements are the
responsibility of the Companys management. Our responsibility is to express an
opinion on these financial statements based on our audits.

We conducted our audits in
accordance with the standards of the Public Company Accounting Oversight Board
(United States). Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.

In our opinion, the
financial statements referred to above present fairly, in all material respects,
the consolidated financial position of Tortoise Capital Resources Corporation at
November 30, 2011 and 2010, and the consolidated results of its operations and
its cash flows for each of the three years in the period ended November 30,
2011, in conformity with U.S. generally accepted accounting
principles.

We also have audited, in
accordance with the standards of the Public Company Accounting Oversight Board
(United States), Tortoise Capital Resources Corporations internal control over
financial reporting as of November 30, 2011, based on criteria established in
Internal Control-Integrated Framework issued by the Committee of Sponsoring
Organizations of the Treadway Commission and our report dated February 13, 2012,
expressed an unqualified opinion thereon.

/s/Ernst & Young LLP


Kansas City,
MissouriFebruary 13, 2012 except for Note 15, as to which the date is  April 27, 2012

F-2

---



| | Tortoise Capital Resources
      Corporation
| | --------------------------------------------

CONSOLIDATED
BALANCE SHEETS

|                                                                                                                |  | **November 30, 2011** |            | **November 30, 2010**
|--------------------------------------------------------------------------------------------------------------- |  | --------------------- | ---------- | ---------------------
|Assets                                                                                                          |  |                       |            |                      
|Trading securities, at fair
      value                                                                         |  | $                     | 27,037,642 |                      
|Other equity securities, at fair
      value                                                                    |  |                       | 41,856,730 |                      
|Leased property, net of accumulated
      depreciation of $294,309                                              |  |                       | 13,832,540 |                      
|Cash and cash equivalents                                                                                       |  |                       | 2,793,326  |                      
|Property and equipment, net of
      accumulated depreciation of $1,483,616                                     |  |                       | 3,842,675  |                      
|Escrow receivable                                                                                               |  |                       | 1,677,052  |                      
|Accounts receivable                                                                                             |  |                       | 1,402,955  |                      
|Intangible lease asset, net of
      accumulated amortization of $121,641                                       |  |                       | 973,130    |                      
|Lease receivable                                                                                                |  |                       | 474,152    |                      
|Prepaid expenses                                                                                                |  |                       | 140,017    |                      
|Receivable for Adviser expense
      reimbursement                                                              |  |                       | 121,962    |                      
|Interest receivable                                                                                             |  |                       |           |                      
|Deferred tax asset                                                                                              |  |                       | 27,536     |                      
|Other assets                                                                                                    |  |                       | 107,679    |                      
|**Total
    Assets**                                                                                            |  |                       | 94,287,396 |                      
|                                                                                                               
|Liabilities and Stockholders Equity                                                                            |  |                       |            |                      
|Liabilities                                                                                                     |  |                       |            |                      
|Management fees payable to
      Adviser                                                                        |  |                       | 365,885    |                      
|Accounts payable                                                                                                |  |                       | 597,157    |                      
|Long-term debt                                                                                                  |  |                       | 2,279,883  |                      
|Lease obligation                                                                                                |  |                       | 107,550    |                      
|Accrued expenses and other
      liabilities                                                                    |  |                       | 510,608    |                      
|Total Liabilities                                                                                               |  |                       | 3,861,083  |                      
|                                                                                                               
|Stockholders Equity                                                                                            |  |                       |            |                      
|Warrants, no par value; 945,594
      issued and outstanding                                                    |  |                       |            |                      
|at
      November 30, 2011 and November 30, 2010                                                                |  |                       |            |                      
|(5,000,000
      authorized)                                                                                    |  | $                     | 1,370,700  |                      
|Capital stock, non-convertible,
      $0.001 par value; 9,176,889 shares issued                                 |  |                       |            |                      
|and
      outstanding at November 30, 2011 and 9,146,506 shares issued                                          |  |                       |            |                      
|and
      outstanding at November 30, 2010 (100,000,000 shares authorized)                                      |  |                       | 9,177      |                      
|Additional paid-in capital                                                                                      |  |                       | 95,682,738 |                      
|Accumulated deficit                                                                                             |  |                       | (6,636,302 | )                    
|**Total Stockholders
      Equity**                                                                            |  | $                     | 90,426,313 |                      
|**Total Liabilities and
      Stockholders Equity**                                                            |  | $                     | 94,287,396 |                      
|                                                                                                               
|**Book value per share (total
      stockholders equity divided by
                shares
      outstanding)** |  | $                     | 9.85       |                      

See accompanying Notes to
Consolidated Financial Statements.

F-3

---



| | Tortoise Capital Resources
      Corporation
| | --------------------------------------------

CONSOLIDATED
STATEMENTS OF INCOME

|                                                                    | **Year
      EndedNovember 30, 2011** |            | **Year
      EndedNovember 30, 2010** |  | **Year
      EndedNovember 30, 2009**
|------------------------------------------------------------------- | ------------------------------------- | ---------- | ------------------------------------- |  | -------------------------------------
|Revenue                                                             |                                       |            |                                       |  |                                      
|Sales Revenue                                                       | $                                     | 2,161,723  |                                       |  | $                                    
|Lease income                                                        |                                       | 1,063,740  |                                       |  |                                      
|**Total
      Revenue**                                             |                                       | 3,225,463  |                                       |  |                                      
|                                                                   
|Expenses                                                            |                                       |            |                                       |  |                                      
|Cost of sales                                                       |                                       | 1,689,374  |                                       |  |                                      
|Management fees, net of expense
      reimbursements                |                                       | 968,163    |                                       |  |                                      
|Asset acquisition expense                                           |                                       | 638,185    |                                       |  |                                      
|Professional fees                                                   |                                       | 548,759    |                                       |  |                                      
|Depreciation expense                                                |                                       | 364,254    |                                       |  |                                      
|Operating expenses                                                  |                                       | 196,775    |                                       |  |                                      
|Directors fees                                                     |                                       | 70,192     |                                       |  |                                      
|Interest expense                                                    |                                       | 36,508     |                                       |  |                                      
|Other expenses                                                      |                                       | 183,674    |                                       |  |                                      
|**Total
      Expenses**                                            |                                       | 4,695,884  |                                       |  |                                      
|                                                                   
|Loss from Operations                                                |                                       | (1,470,421 | )                                     |  |                                      
|                                                                   
|Other Income                                                        |                                       |            |                                       |  |                                      
|Net realized and unrealized gain
      (loss) on trading securities |                                       | 2,299,975  |                                       |  |                                      
|Net realized and unrealized gain on
      other equity securities   |                                       | 2,283,773  |                                       |  |                                      
|Distributions and dividend income,
      net                        |                                       | 651,673    |                                       |  |                                      
|Other income                                                        |                                       | 40,000     |                                       |  |                                      
|Total Other
      Income                                            |                                       | 5,275,421  |                                       |  |                                      
|Income before Income Taxes                                          |                                       | 3,805,000  |                                       |  |                                      
|Current tax expense                                                 |                                       | (253,650   | )                                     |  |                                      
|Deferred tax expense                                                |                                       | (629,207   | )                                     |  |                                      
|Income
      tax expense, net                                       |                                       | (882,857   | )                                     |  |                                      
|                                                                   
|Net Income                                                          | $                                     | 2,922,143  |                                       |  | $                                    
|                                                                   
|Earnings Per Common Share:                                          |                                       |            |                                       |  |                                      
|Basic and Diluted                                                   | $                                     | 0.32       |                                       |  | $                                    
|                                                                   
|Weighted Average Shares of Common Stock Outstanding:                |                                       |            |                                       |  |                                      
|Basic and Diluted                                                   |                                       | 9,159,809  |                                       |  |                                      

See accompanying Notes to
Consolidated Financial Statements.

F-4

---



| | Tortoise Capital Resources
      Corporation
| | --------------------------------------------

CONSOLIDATED
STATEMENTS OF EQUITY

|                                      |  | ****                    |  |            |       | **Additional** |   | **Retained Earnings** |  |             
|------------------------------------- |  | ----------------------- |  | ---------- | ----- | -------------- | - | --------------------- |  | ------------
|                                      |  | **Capital
      Stock** |  |            |       | **Paid-in**    |   | **(Accumulated**      |  |             
|                                      |  | **Shares**              |  | **Amount** |       | **Warrants**   |   | **Capital**           |  | **Deficit)**
|Balance at December 1, 2008           |  | 8,962,147               |  | $          | 8,962 |                | $ | 1,370,700             |  | $           
|Net
    Income                        |  |                         |  |            |       |                |   |                       |  |             
|Distributions to stockholders sourced |  |                         |  |            |       |                |   |                       |  |             
|as return of capital                  |  |                         |  |            |       |                |   |                       |  |             
|Reinvestment of
      distributions   |  |                         |  |            |       |                |   |                       |  |             
|to stockholders                       |  | 115,943                 |  |            | 116   |                |   |                       |  |             
|Balance at November 30, 2009          |  | 9,078,090               |  |            | 9,078 |                |   | 1,370,700             |  |             
|Net
    Income                        |  |                         |  |            |       |                |   |                       |  |             
|Distributions to stockholders sourced |  |                         |  |            |       |                |   |                       |  |             
|as return of capital                  |  |                         |  |            |       |                |   |                       |  |             
|Reinvestment of
      distributions   |  |                         |  |            |       |                |   |                       |  |             
|to stockholders                       |  | 68,416                  |  |            | 69    |                |   |                       |  |             
|Balance at November 30, 2010          |  | 9,146,506               |  |            | 9,147 |                |   | 1,370,700             |  |             
|Net
    Income                        |  |                         |  |            |       |                |   |                       |  |             
|Distributions to stockholders sourced |  |                         |  |            |       |                |   |                       |  |             
|as return of capital                  |  |                         |  |            |       |                |   |                       |  |             
|Reinvestment of
      distributions   |  |                         |  |            |       |                |   |                       |  |             
|to stockholders                       |  | 30,383                  |  |            | 30    |                |   |                       |  |             
|Consolidation of wholly-owned         |  |                         |  |            |       |                |   |                       |  |             
|subsidiary                            |  |                         |  |            |       |                |   |                       |  |             
|Balance at
      November 30, 2011    |  | 9,176,889               |  | $          | 9,177 |                | $ | 1,370,700             |  | $           

See accompanying Notes to
Consolidated Financial Statements.

F-5

---



| | Tortoise Capital Resources
      Corporation
| | --------------------------------------------

CONSOLIDATED
STATEMENTS OF CASH FLOWS

|                                                                                                                 |  | **Year
      EndedNovember 30, 2011** |             | **Year
      EndedNovember 30, 2010** |  | **Year
      EndedNovember 30, 2009**
|---------------------------------------------------------------------------------------------------------------- |  | ------------------------------------- | ----------- | ------------------------------------- |  | -------------------------------------
|Operating Activities                                                                                             |  |                                       |             |                                       |  |                                      
|Net Income                                                                                                       |  | $                                     | 2,922,143   |                                       |  | $                                    
|Adjustments:                                                                                                     |  |                                       |             |                                       |  |                                      
|Distributions received from investment securities                                                                |  |                                       | 2,845,434   |                                       |  |                                      
|Deferred
      income tax expense, net                                                                           |  |                                       | 629,207     |                                       |  |                                      
|Depreciation
      expense                                                                                       |  |                                       | 364,254     |                                       |  |                                      
|Amortization
      of intangible lease asset                                                                     |  |                                       | 121,641     |                                       |  |                                      
|Amortization
      of assumed debt premium                                                                       |  |                                       | (94,611     | )                                     |  |                                      
|Realized
      and unrealized (gain) loss on trading securities                                                  |  |                                       | (2,299,975  | )                                     |  |                                      
|Realized
      and unrealized (gain) loss on other
                          equity
      securities             |  |                                       | (2,283,773  | )                                     |  |                                      
|Changes
      in assets and liabilities:                                                                         |  |                                       |             |                                       |  |                                      
|(Increase)
      decrease in interest, dividend and
                               distribution
      receivable |  |                                       | 42,778      |                                       |  |                                      
|Decrease
      in lease receivable                                                                               |  |                                       | 237,077     |                                       |  |                                      
|Increase
      in accounts receivable                                                                            |  |                                       | (92,473     | )                                     |  |                                      
|Decrease
      in income tax receivable                                                                          |  |                                       |            |                                       |  |                                      
|Decrease
      (increase) in prepaid expenses
                               and
      other assets              |  |                                       | 70,109      |                                       |  |                                      
|Increase
      (decrease) in management fees
                               payable
      to Adviser, net of     |  |                                       |             |                                       |  |                                      
|expense
      reimbursement                                                                                      |  |                                       | 25,632      |                                       |  |                                      
|Increase
      in accounts payable                                                                               |  |                                       | 236,579     |                                       |  |                                      
|Increase
      (decrease) in accrued expenses
                               and
      other liabilities         |  |                                       | 38,424      |                                       |  |                                      
|Net cash provided by
      operating activities                                                                  |  | $                                     | 2,762,446   |                                       |  | $                                    
|                                                                                                                
|Investing Activities                                                                                             |  |                                       |             |                                       |  |                                      
|Purchases
      of long-term investments                                                                         |  |                                       | (38,060,281 | )                                     |  |                                      
|Proceeds
      from sales of long-term investments                                                               |  |                                       | 53,950,583  |                                       |  |                                      
|Cash
      paid in business combination                                                                          |  |                                       | (12,250,000 | )                                     |  |                                      
|Purchases
      of property and equipment                                                                        |  |                                       | (1,045      | )                                     |  |                                      
|Net cash provided by investing
      activities                                                                  |  | $                                     | 3,639,257   |                                       |  | $                                    
|                                                                                                                
|Financing Activities                                                                                             |  |                                       |             |                                       |  |                                      
|Payments
      on long-term debt                                                                                 |  |                                       | (1,221,000  | )                                     |  |                                      
|Payments
      on lease obligation                                                                               |  |                                       | (44,816     | )                                     |  |                                      
|Advances
      from revolving line of credit                                                                     |  |                                       |            |                                       |  |                                      
|Repayments
      on revolving line of credit                                                                     |  |                                       | (400,000    | )                                     |  |                                      
|Distributions
      paid to common stockholders                                                                  |  |                                       | (3,503,365  | )                                     |  |                                      
|Net cash used in financing
      activities                                                                      |  | $                                     | (5,169,181  | )                                     |  | $                                    
|                                                                                                                
|Net Change in Cash and Cash Equivalents                                                                          |  | $                                     | 1,232,522   |                                       |  | $                                    
|Consolidation of wholly-owned subsidiary                                                                         |  |                                       | 94,611      |                                       |  |                                      
|Cash and Cash Equivalents at beginning of year                                                                   |  |                                       | 1,466,193   |                                       |  |                                      
|Cash and Cash Equivalents at end of year                                                                         |  | $                                     | 2,793,326   |                                       |  | $                                    
|                                                                                                                
|Supplemental Disclosure of Cash Flow Information                                                                 |  |                                       |             |                                       |  |                                      
|Interest paid                                                                                                    |  | $                                     | 176,595     |                                       |  | $                                    
|Income taxes paid                                                                                                |  | $                                     | 253,650     |                                       |  | $                                    
|Non-Cash Financing Activities                                                                                    |  |                                       |             |                                       |  |                                      
|Reinvestment of distributions by
      common stockholders                                                       |  |                                       |             |                                       |  |                                      
|in
      additional common shares                                                                                |  | $                                     | 252,242     |                                       |  | $                                    

See accompanying Notes to
Consolidated Financial Statements.

F-6

---



| | Tortoise Capital Resources
      Corporation
| | --------------------------------------------

NOTES TO
CONSOLIDATED FINANCIAL STATEMENTSNovember
30, 2011

1. Organization

Tortoise Capital Resources
Corporation (the Company) was organized as a Maryland corporation on September
8, 2005. The Company completed its initial public offering in February 2007 as a
non-diversified closed-end management investment company regulated as a business
development company (BDC) under the Investment Company Act of 1940, as amended
(the 1940 Act). The Company withdrew its election to be treated as a BDC on
September 21, 2011 in order to pursue qualification as a real estate investment
trust (REIT). Historically as a BDC, the Company invested primarily in
privately held companies operating in the U.S. energy infrastructure sector. The
Companys shares are listed on the New York Stock Exchange under the symbol
TTO.

2. Significant Accounting
Policies

A. Use of Estimates  The preparation of the consolidated financial
statements in conformity with U.S. generally accepted accounting principles
(GAAP) requires management to make estimates and assumptions that affect the
reported amount of assets and liabilities, recognition of distribution income
and disclosure of contingent assets and liabilities at the date of the
consolidated financial statements. Actual results could differ from those
estimates.

B. Basis of Presentation  The Companys consolidated financial statements
include the accounts of the Company and its wholly-owned subsidiary, Mowood, LLC
(Mowood). Mowood is the holding company for Omega Pipeline Company (Omega).
Omega is a natural gas local distribution company that owns and operates a
natural gas distribution system in Fort Leonard Wood, Missouri. Omega is
responsible for purchasing and coordinating delivery of natural gas to Fort
Leonard Wood as well as performing maintenance and expansion of the pipeline. In
addition, Omega provides gas marketing services to local commercial end users.
All significant inter-company balances and transactions have been eliminated in
consolidation.

Consolidation of Mowood was
triggered at the time the Company withdrew its election to be treated as a BDC
(September 21, 2011) and began reporting its financial results in accordance
with general corporate reporting guidelines instead of under the AICPA
Investment Company Audit Guide (the Guide). The accompanying consolidated
financial statements reflect the results of the Companys operations for the
years ended November 30, 2009 and 2010 and the period from December 1, 2010 to
September 21, 2011, during which time the Company reported under the Guide, and
therefore reported and accounted for Mowood as an investment carried at fair
value. Subsequent to September 21, 2011, the Company ceased reporting under the
Guide. The results of operations for Mowood for the period from September 21,
2011 to November 30, 2011 and related balances at November 30, 2011 are included
in the Companys consolidated financial statements as of and for the year ended
November 30, 2011. Certain prior year balances have been reclassified to conform
to the presentation required for general corporate entities and to provide
comparability of financial results across reporting periods. The
reclassification of account balances for prior years, which are summarized
below, did not impact the Companys financial position or reported net results
of operations:

- Investments at fair value, including securities of
  control, affiliated and non-affiliated companies, at November 30, 2010 have
  been reclassified as either trading or other equity
  securities.
- Components of Stockholders Equity on the
  Consolidated Balance Sheets as of November 30, 2010 have been combined.
  Accumulated net investment loss, net of income taxes of $(3,308,522),
  accumulated realized loss, net of income taxes of $(18,532,648), and net
  unrealized appreciation of investments, net of income taxes of $17,495,544
  have been combined into Accumulated Deficit.
- Items on the Consolidated Statements of Income for
  the years ended November 30, 2010 and 2009 have been reclassified and
  aggregated to conform to the presentation of the results of operations for the
  year ended November 30, 2011. However, there was no impact to net income or
  earnings per share. Income from investment securities are no longer considered
  to be part of the Companys operations and therefore have been classified as
  Other Income.
- Components of cash flows for the years ended
  November 30, 2010 and 2009 have been reclassified and aggregated to conform to
  the presentation of cash flows for the year ended November 30, 2011.

C.Investment Securities The Companys investments in securities are
classified as either trading or other equity securities:

- Trading securities  the Companys publicly traded equity securities are
  classified as trading securities and are reported at fair value because the Company intends to sell
  these securities in order to acquire real asset investments.
- Other equity securities  the Companys other equity securities
  represent interests in private companies for which theCompany has elected to report these at fair
  value under the fair value option.

D.Security Transactions and Fair
Value Security transactions are
accounted for on the date the securities are purchased or sold (trade date).
Realized gains and losses are reported on an identified cost basis.

F-7

---



For equity securities that
are freely tradable and listed on a securities exchange or over-the-counter
market, the Company fair values those securities at their last sale price on
that exchange or over-the-counter market on the valuation date. If the security
is listed on more than one exchange, the Company will use the price from the
exchange that it considers to be the principal exchange on which the security is
traded. Securities listed on the NASDAQ will be valued at the NASDAQ Official
Closing Price, which may not necessarily represent the last sale price. If there
has been no sale on such exchange or over-the-counter market on such day, the
security will be valued at the mean between the last bid price and last ask
price on such day.

An equity security of a
publicly traded company acquired in a private placement transaction without
registration is subject to restrictions on resale that can affect the securitys
liquidity and fair value. Such securities that are convertible into or otherwise
will become freely tradable will be valued based on the market value of the
freely tradable security less an applicable discount. Generally, the discount
will initially be equal to the discount at which the Company purchased the
securities. To the extent that such securities are convertible or otherwise
become freely tradable within a time frame that may be reasonably determined, an
amortization schedule may be used to determine the discount.

The Company holds
investments in illiquid securities including debt and equity securities of
privately-held companies. These investments generally are subject to
restrictions on resale, have no established trading market and are fair valued
on a quarterly basis. Because of the inherent uncertainty of valuation, the fair
values of such investments, which are determined in accordance with procedures
approved by the Companys Board of Directors, may differ materially from the
values that would have been used had a ready market existed for the investments.
The Companys Board of Directors may consider other methods of valuing
investments as appropriate and in conformity with GAAP.

The Company determines fair
value to be the price that would be received to sell an asset or paid to
transfer a liability in an orderly transaction between market participants at
the measurement date. The Company has determined the principal market, or the
market in which the Company exits its private portfolio investments with the
greatest volume and level of activity, to be the private secondary market.
Typically, private companies are bought and sold based on multiples of EBITDA,
cash flows, net income, revenues, or in limited cases, book value.

For private company
investments, value is often realized through a liquidity event of the entire
company. Therefore, the value of the company as a whole (enterprise value) at
the reporting date often provides the best evidence of the value of the
investment and is the initial step for valuing the Companys privately issued
securities. For any one company, enterprise value may best be expressed as a
range of fair values, from which a single estimate of fair value will be
derived. In determining the enterprise value of a portfolio company, an analysis
is prepared consisting of traditional valuation methodologies including market
and income approaches. The Company considers some or all of the traditional
valuation methods based on the individual circumstances of the portfolio company
in order to derive its estimate of enterprise value.

The fair value of
investments in private portfolio companies is determined based on various
factors, including enterprise value, observable market transactions, such as
recent offers to purchase a company, recent transactions involving the purchase
or sale of the equity securities of the company, or other liquidation events.
The determined equity values may be discounted when the Company has a minority
position, is subject to restrictions on resale, has specific concerns about the
receptivity of the capital markets to a specific company at a certain time, or
other comparable factors exist.

The Board of Directors
undertakes a multi-step valuation process each quarter in connection with
determining the fair value of private investments. An independent valuation firm
has been engaged by the Board of Directors to provide independent, third-party
valuation consulting services based on procedures that the Board of Directors
has identified and may ask them to perform from time to time on all or a
selection of private investments as determined by the Board of Directors. The
multi-step valuation process is specific to the level of assurance that the
Board of Directors requests from the independent valuation firm. For positive
assurance, the process is as follows:

- The independent valuation firm prepares the preliminary valuations and the
  supporting analysis. At November 30, 2011, the independent valuation firm performed positive assurance valuation
  procedures on five portfolio companies comprising approximately 99.9 percent
  of the total fair value of other equity securities;
- The investment professionals of the
  Adviser review the preliminary valuations and supporting analyses, and
  consider andassess, as
  appropriate, any changes that may be required to the preliminary
  valuations;
- The Investment Committee of the Adviser reviews the preliminary valuations
  and supporting analyses, and considers and assesses, as appropriate, any
  changes that may be required to the preliminary valuations;
- The Board of Directors assesses the
  final valuations and ultimately determines the fair value of each investment
  in theCompanys portfolio in good
  faith.

The following section
describes the valuation methodologies used by the Company for estimating fair
value for financial instruments not recorded at fair value as required under
disclosure guidance

F-8

---



related to the fair value
of financial instruments.

Cash and Cash Equivalents The carrying value of cash, amounts due from
banks, federal funds sold and securities purchased under resale agreements
approximates fair value.

Escrow Receivable The fair value of the escrow receivable due the
Company, which relates to the sale of International Resource Partners, LP, will
be released upon satisfaction of certain post closing obligations and/or the
expiration of certain time periods (the shortest of which is 14 months from the
April 2011 closing date of the sale).

Long-term Debt The fair value of the Companys long-term debt
is calculated, for disclosure purposes, by discounting future cash flows by a
rate equal to the Companys current expected rate for an equivalent
transaction.

The estimated fair values
of the Companys financial instruments are shown in the table below:

|                          | **2011**                |           |                | **2010**
|------------------------- | ----------------------- | --------- | -------------- | --------
|                          | **Carrying
    Amount** |           | **Fair value** |         
|**Financial assets**      |                         |           |                |         
|Cash and cash equivalents | $                       | 2,793,326 |                | $       
|Escrow Receivable         |                         | 1,677,052 |                |         
|**Financial Liabilities** |                         |           |                |         
|Long-term debt            |                         | 2,279,883 |                |         

E.Cash and Cash Equivalents The Company maintains cash balances at
financial institutions in amounts that regularly exceed FDIC insured limits. The
Companys cash equivalents are comprised of short-term, liquid money market
instruments.

F.Accounts Receivable Accounts receivable are presented at face value
net of an allowance for doubtful accounts. Accounts are considered past due
based on the terms of sale with the customers. The Company reviews accounts for
collectability based on an analysis of specific outstanding receivables, current
economic conditions and past collection experience. Management determined that
an allowance for doubtful accounts was not necessary at November 30,
2011.

G.Revenue and Other Income
Recognition Specific policies
for the Companys revenue and other income items are as follows:

- *Sales Revenue* Omega, acting
  as a principal, provides for transportation services and natural gas supply
  for its customers on a firm basis. In addition, Omega is paid fees for the
  operation and maintenance of its pipeline, including expansion of the
  pipeline. Omega is responsible for the coordination, supervision and quality
  of the expansions while actual construction is generally performed by third
  party contractors. Revenues related to natural gas distribution are recognized
  upon delivery of natural gas and upon the substantial performance of
  management and supervision services related to the expansion of the natural
  gas distribution system.
- Dividends and distributions from
  investments Dividends and
  distributions from investments are recorded on their ex-dates and are
  reflected as other income within the accompanying Consolidated Statements of
  Income. Distributions received from the Companys investments generally are
  comprised of ordinary income, capital gains and return of capital. The Company
  records investment income, capital gains and return of capital based on
  estimates made at the time such distributions are received. Such estimates are
  based on information available from each company and/or other industry
  sources. These estimates may subsequently be revised based on information
  received from the entities after their tax reporting periods are concluded, as
  the actual character of these distributions is not known until after the
  fiscal year end of the Company.  During the year ended November 30,
  2011, the Company reallocated the amount of 2010 income and return of capital
  it recognized for the period from December 1, 2009 through November 30, 2010
  based on the 2010 tax reporting information received from the individual
  portfolio companies. This reclassification amounted to a decrease in pre-tax
  net income of approximately $422,000 or $0.046 per share ($263,000 or $0.029
  per share, net of deferred tax benefit); an increase in net realized and
  unrealized gains on trading securities of approximately $47,000 or $0.005 per
  share ($29,000 or $0.003 per share, net of deferred tax expense) and an
  increase in net realized and unrealized gains on other equity securities of
  approximately $375,000 or $0.041 per share ($234,000 or $0.026 per share, net
  of deferred tax expense) for the year ended November 30,
  2011.
- Realized and unrealized gains
  (losses) on trading securities and other equity securities Changes in the fair values of the Companys
  securities during the period reported and the gains or losses realized upon
  sale of securities during the period are reflected as other income within the
  accompanying Consolidated Statements of Income.
- Lease Income Income related to the Companys leased
  property is recognized on a straight-line basis over the term of the lease
  when collectability is reasonably assumed. Rental payments on the leased
  property are typically received on a semi-annual basis and are included as
  lease income within the accompanying Consolidated Statements of
  Income.

F-9

---



H.Cost of Sales Included in the Companys cost of sales are the
amounts paid for gas and propane that are delivered to customers as well as the
cost of material and labor related to the expansion of the natural gas
distribution system.

I.Distributions to Stockholders The amount of any quarterly distributions to
stockholders will be determined by the Board of Directors. Distributions to
stockholders are recorded on the ex-dividend date. The character of
distributions made during the year may differ from their ultimate
characterization for federal income tax purposes. For the years ended November
30, 2011, November 30, 2010 and November 30, 2009, the source of the Companys
distributions for book purposes was 100 percent return of capital. For the year
ended November 30, 2011, the Companys distributions for tax purposes were
comprised of 100 percent qualified dividend income. For the years ended November
30, 2010 and November 30, 2009, the Companys distributions for tax purposes
were comprised of 100 percent return of capital.

J.Federal and State Income Taxation The Company, as a corporation, is obligated to
pay federal and state income tax on its taxable income. Currently, the highest
regular marginal federal income tax rate for a corporation is 35 percent. The
Company may be subject to a 20 percent federal alternative minimum tax on its
federal alternative minimum taxable income to the extent that its alternative
minimum tax exceeds its regular federal income tax.

The Companys trading
securities and other equity securities are limited partnerships or limited
liability companies which are treated as partnerships for federal and state
income tax purposes. As a limited partner, the Company reports its allocable
share of taxable income in computing its own taxable income. The Companys tax
expense or benefit is included in the Consolidated Statements of Income.
Deferred income taxes reflect the net tax effects of temporary differences
between the carrying amounts of assets and liabilities for financial reporting
purposes and the amounts used for income tax purposes. A valuation allowance is
recognized if, based on the weight of available evidence, it is more likely than
not that some portion or all of the deferred income tax asset will not be
realized.

K.Leases The Company includes assets subject to lease arrangements within
Leased property, net of accumulated depreciation in the Consolidated Balance
Sheet. Lease payments received are reflected in lease income on the Consolidated
Statements of Income, net of amortization of any off market
adjustments.

L.Long-Lived Assets and Intangibles Property and equipment are stated at cost less
accumulated depreciation. Depreciation is computed using the straight-line
method over the estimated useful lives of the assets ranging from five to twenty
years. Expenditures for repairs and maintenance are charged to operations as
incurred, and improvements, which extend the useful lives of assets, are
capitalized and depreciated over the remaining estimated useful life of the
asset.

The Company initially
records long-lived assets at their acquisition cost, unless the transaction is
accounted for as a business combination. If the transaction is accounted for as
a business combination, the Company allocates the purchase price to the acquired
tangible and intangible assets and liabilities based on their estimated fair
values. The Company determines the fair values of assets and liabilities based
on discounted cash flow models using current market assumptions, appraisals,
recent transactions involving similar assets or liabilities and/or other
objective evidence, and depreciates the asset values over the estimated
remaining useful lives.

In connection with these
transactions, the Company may acquire long-lived assets that are subject to an
existing lease contract with the seller or other lessee party and the Company
may assume outstanding debt of the seller as part of the consideration paid. If,
at the time of acquisition, the existing lease or debt contract is not at
current market terms, the Company will record an asset or liability at the time
of acquisition representing the amount by which the fair value of the lease or
debt contract differs from its contractual value. Such amount is then amortized
over the remaining contract term as an adjustment to the related lease revenue
or interest expense.

M.Offering Costs Offering costs related to the issuance of
common stock are charged to additional paid-in capital when the stock is
issued.

N.Recent Accounting Pronouncement In May 2011, the FASB issued ASU No. 2011-04
Amendments to Achieve Common Fair Value Measurement and Disclosure
Requirements in GAAP and the International Financial Reporting Standards
(IFRSs). ASU No. 2011-04 amends FASB ASC Topic 820, Fair Value Measurements
and Disclosures, to establish common requirements for measuring fair value and
for disclosing information about fair value measurements in accordance with GAAP
and IFRSs. ASU No. 2011-04 is effective for fiscal years beginning after
December 15, 2011 and for interim periods within those fiscal years. Management
is currently evaluating the impact of these amendments and does not believe they
will have a material impact on the Companys consolidated financial
statements.

3. Concentrations

The Company has
historically invested in securities of privately-held and publicly-traded
companies in the midstream and downstream segments of the U.S. energy
infrastructure sector. As of November 30, 2011, investments in securities of
energy infrastructure companies represented approximately 73 percent of the
Companys total assets. The Company is now focused on identifying and acquiring
real property assets in the U.S. energy infrastructure sector that are REIT
qualified.

F-10

---



The Companys leased
property at November 30, 2011 is leased to a single entity, Public Service
Company of New Mexico, as further described in Note 7 below. Public Service
Company of New Mexicos financial condition and ability and willingness to
satisfy its obligations under its leases with the Company have a considerable
impact on the Companys results of operations and ability to service its
indebtedness.

Mowood, the Companys
wholly owned subsidiary, has a ten-year contract expiring in 2015 to supply
natural gas to the Department of Defense (DOD). Revenue related to the DOD
contract accounted for 88 percent of sales revenues for the period from
September 21, 2011 through November 30, 2011. Mowood, through its wholly owned
subsidiary Omega, performs management and supervision services related to the
expansion of the natural gas distribution system used by the DOD. Revenues
related to these services accounted for 16 percent of sales revenues for the
period from September 21, 2011 through November 30, 2011. Amounts due from the
DOD account for 85 percent of the consolidated accounts receivable balance at
November 30, 2011.

Mowoods contracts for its supply of
natural gas are concentrated among select providers. Payments to the top
supplier of natural gas accounted for 60 percent of cost of sales for the period
from September 21, 2011 through November 30, 2011.

4. Agreements

The Company entered into a
new management agreement after its fiscal year end as more fully described in
Note 15. From the Companys inception through November 30, 2011, it had an
Investment Advisory Agreement with Tortoise Capital Advisors, L.L.C. Under the
terms of the Investment Advisory Agreement, the Adviser is paid a fee consisting
of a base management fee and an incentive fee. The base management fee is 0.375
percent (1.5 percent annualized) of the Companys average monthly Managed
Assets, calculated and paid quarterly in arrears within thirty days of the end
of each fiscal quarter. The term Managed Assets as used in the calculation of
the management fee means total assets (including any assets purchased with or
attributable to borrowed funds but excluding any net deferred tax asset) minus
accrued liabilities other than (1) net deferred tax liabilities, (2) debt
entered into for the purpose of leverage and (3) the aggregate liquidation
preference of any outstanding preferred shares. The base management fee for any
partial quarter is appropriately prorated.

The Adviser reimbursed the
Company for certain expenses in an amount equal to an annual rate of 0.25
percent of the Companys average monthly Managed Assets during the period from
December 1, 2008 through May 31, 2010 and in an amount equal to an annual rate
of 0.50 percent of the Companys average monthly Managed Assets from June 1,
2010 through November 30, 2011. During the years ended November 30, 2011,
November 30, 2010 and November 30, 2009, the Adviser reimbursed the Company
$484,082, $308,003 and $225,266, respectively, which are included in management
fees, net of expense reimbursement in the Consolidated Statements of Income. If
the Adviser had not reimbursed the Company for these fees, management fees would
have been higher.

The incentive fee consists
of two parts. The first part, the investment income fee, is equal to 15 percent
of the excess, if any, of the Companys Net Investment Income for the fiscal
quarter over a quarterly hurdle rate equal to 2 percent (8 percent annualized),
and multiplied, in either case, by the Companys average monthly Net Assets for
the quarter. Net Assets means the Managed Assets less deferred taxes, debt
entered into for the purposes of leverage and the aggregate liquidation
preference of any outstanding preferred shares. Net Investment Income means
interest income (including accrued interest that we have not yet received in
cash), dividend and distribution income from equity investments (but excluding
that portion of cash distributions that are treated as a return of capital), and
any other income (including any fees such as commitment, origination,
syndication, structuring, diligence, monitoring, and consulting fees or other
fees that the Company is entitled to receive from portfolio companies) accrued
during the fiscal quarter, minus the Companys operating expenses for such
quarter (including the base management fee, expense reimbursements payable
pursuant to the Investment Advisory Agreement, any interest expense, any accrued
income taxes related to net investment income, and distributions paid on issued
and outstanding preferred stock, if any, but excluding the incentive fee
payable). Net Investment Income also includes, in the case of investments with a
deferred interest or income feature (such as original issue discount, debt or
equity instruments with a payment-in-kind feature, and zero coupon securities),
accrued income that the Company has not yet received in cash. Net Investment
Income does not include any realized capital gains, realized capital losses, or
unrealized capital appreciation or depreciation. The investment income fee is
calculated and payable quarterly in arrears within thirty (30) days of the end
of each fiscal quarter. The investment income fee calculation is adjusted
appropriately on the basis of the number of calendar days in the first fiscal
quarter the fee accrues or the fiscal quarter during which the Agreement is in
effect in the event of termination of the Agreement during any fiscal quarter.
During the years ended November 30, 2011, November 30, 2010 and November 30,
2009, the Company accrued no investment income fees.

The second part of the
incentive fee payable to the Adviser, the capital gain incentive fee, is equal
to: (A) 15 percent of (i) the Companys net realized capital gains (realized
capital gains less realized capital losses) on a cumulative basis from inception
to the end of each fiscal year, less (ii) any unrealized capital depreciation at
the end of such fiscal year, less (B) the aggregate amount of all capital gain
fees paid to the Adviser in prior fiscal years. The capital gain incentive fee
is calculated and payable annually within thirty (30) days of the end of each
fiscal year. In the event the Investment Advisory Agreement is terminated, the
capital gain incentive fee calculation shall be undertaken as of, and any
resulting capital gain incentive fee shall be paid

F-11

---



within thirty (30) days of
the date of termination. The Adviser may, from time to time, waive or defer all
or any part of the compensation described in the Investment Advisory
Agreement.

The calculation of the
capital gain incentive fee does not include any capital gains that result from
that portion of any scheduled periodic distributions made possible by the
normally recurring cash flow from the operations of portfolio companies
(Expected Distributions) that are characterized by the Company as return of
capital for U.S. generally accepted accounting principles purposes. In that
regard, any such return of capital will not be treated as a decrease in the cost
basis of an investment for purposes of calculating the capital gain incentive
fee. This does not apply to any portion of any distribution from a portfolio
company that is not an Expected Distribution. Realized capital gains on a
security will be calculated as the excess of the net amount realized from the
sale or other disposition of such security over the adjusted cost basis for the
security. Realized capital losses on a security will be calculated as the amount
by which the net amount realized from the sale or other disposition of such
security is less than the adjusted cost basis of such security. Unrealized
capital depreciation on a security will be calculated as the amount by which the
Companys adjusted cost basis of such security exceeds the fair value of such
security at the end of a fiscal year.

The payable for capital
gain incentive fees is a result of the increase or decrease in the fair value of
investments and realized gains or losses from investments. For the years ended
November 30, 2011, November 30, 2010 and November 30, 2009, the Company accrued
no capital gain incentive fees. Pursuant to the Investment Advisory Agreement,
the capital gain incentive fee is paid annually only if there are realization
events and only if the calculation defined in the agreement results in an amount
due. No capital gain incentive fees have been paid since the commencement of
operations.

U.S. Bancorp Fund Services,
LLC serves as the Companys fund accounting services provider. The Company pays
the provider a monthly fee computed at an annual rate of $24,000 on the first
$50,000,000 of the Companys Net Assets, 0.0125 percent on the next $200,000,000
of Net Assets, 0.0075 percent on the next $250,000,000 of Net Assets and 0.0025
percent on the balance of the Companys Net Assets.

The Adviser serves as the
Companys administrator. The Company paid the administrator a fee equal to an
annual rate of 0.07 percent of aggregate average daily Managed Assets up to and
including $150,000,000, 0.06 percent of aggregate average daily Managed Assets
on the next $100,000,000, 0.05 percent of aggregate average daily Managed Assets
on the next $250,000,000, and 0.02 percent on the balance thru November 30,
2010. On December 1, 2010, the Company entered into an Amended Administration
Agreement with the administrator that decreased the fee to an amount equal to an
annual rate of 0.04 percent of aggregate average daily Managed Assets, with a
minimum annual fee of $30,000. This fee is calculated and accrued daily and paid
quarterly in arrears.

5. Income Taxes

Deferred income taxes
reflect the net tax effect of temporary differences between the carrying amount
of assets and liabilities for financial reporting and tax purposes. Components
of the Companys deferred tax assets and liabilities as of November 30, 2011 and
November 30, 2010 are as follows:

|                                                    |  | November 30,
      2011 |            | November 30,
      2010
|--------------------------------------------------- |  | ----------------------- | ---------- | -----------------------
|Deferred tax assets:                                |  |                         |            |                        
|Organization costs                                  |  | $                       | (20,068    | )                      
|Capital loss carryforwards                          |  |                         |           |                        
|Net operating loss carryforwards                    |  |                         | (2,624,525 | )                      
|Cost recovery of leased assets                      |  |                         | (119,970   | )                      
|AMT and State of Kansas credit                      |  |                         | (205,039   | )                      
|Valuation allowance                                 |  |                         |           |                        
|                                                    |  |                         | (2,969,602 | )                      
|Deferred tax liabilities:                           |  |                         |            |                        
|Basis reduction of investment in
      partnerships |  |                         | 2,244,914  |                        
|Net unrealized gain on investment
      securities  |  |                         | 697,152    |                        
|                                                    |  |                         | 2,942,066  |                        
|Total net deferred tax asset                        |  | $                       | (27,536    | )                      
|                                                    |  |                         |            |                        

At November 30, 2011, a
valuation allowance on deferred tax assets was not deemed necessary because the
Company believes it is more likely than not that there is an ability to realize
its deferred tax assets through future taxable income. Any adjustments to the
Companys estimates of future taxable income will be made in the period such
determination is made. The Companys policy is to record interest and penalties
on uncertain tax positions as part of tax expense. As of November 30, 2011, the
Company had no uncertain tax positions and no penalties and interest were
accrued. The Company does not expect any change to its unrecognized tax
positions in the twelve months subsequent to November 30, 2011. Tax years
subsequent to the year ending November 30, 2006 remain open to examination by
federal and state tax authorities.

F-12

---



Total income tax expense
differs from the amount computed by applying the federal statutory income tax
rates of 35 percent for the year ended November 30, 2011 and 34 percent for the
years ended November 30, 2010 and 2009 to net investment loss and net realized
and unrealized gains (losses) on investments for the years presented, as
follows:

|                                                                         | For the year ended      |           | For the year ended      |  | For the year ended     
|------------------------------------------------------------------------ | ----------------------- | --------- | ----------------------- |  | -----------------------
|                                                                         | November 30,
      2011 |           | November 30,
      2010 |  | November 30,
      2009
|Application of statutory income tax rate                                 | $                       | 1,331,750 |                         |  | $                      
|State income
      taxes, net of federal tax benefit                     |                         | 133,158   |                         |  |                        
|Dividends received deduction                                             |                         | (86       | )                       |  |                        
|Change in
      deferred tax liability due to change in overall tax rate |                         | (23,432   | )                       |  |                        
|Change in deferred tax valuation allowance                               |                         | (558,533  | )                       |  |                        
|Total income tax
      expense                                           | $                       | 882,857   |                         |  | $                      
|                                                                         |                         |           |                         |  |                        

Total income taxes are
computed by applying the federal statutory rate plus a blended state income tax
rate. During the year, the Company re-evaluated its overall federal and state
income tax rate, increasing it from 35.82 percent to 37.62 percent, due to (1)
an anticipated 35 percent federal rate, and (2) anticipated state apportionment
of income and gains.

The components of income
tax expense include the following for the years presented:

|                                                                     |  | For the year ended      |         | For the year ended      |   | For the year ended     
|-------------------------------------------------------------------- |  | ----------------------- | ------- | ----------------------- | - | -----------------------
|                                                                     |  | November 30,
      2011 |         | November 30,
      2010 |   | November 30,
      2009
|Current tax expense                                                  |  |                         |         |                         |   |                        
|State (reflects a federal tax benefit in
      deferred tax expense) |  | $                       | 53,650  |                         | $ |                       
|AMT                                                                  |  |                         | 200,000 |                         |   |                       
|Total current
      tax expense                                      |  |                         | 253,650 |                         |   |                       
|Deferred tax expense                                                 |  |                         |         |                         |   |                        
|Federal                                                              |  |                         | 585,386 |                         |   | 4,530,152              
|State (net of federal tax
    benefit)                               |  |                         | 43,821  |                         |   | 242,496                
|Total deferred
      tax expense                                     |  |                         | 629,207 |                         |   | 4,772,648              
|Total income tax expense                                             |  | $                       | 882,857 |                         | $ | 4,772,648              
|                                                                     |  |                         |         |                         |   |                        

The deferred income tax
expense for the years ended November 30, 2011, 2010 and 2009 includes the impact
of the change in valuation allowance for such respective years.

As of November 30, 2011,
the Company had a net operating loss for federal income tax purposes of
approximately $7,236,000. The net operating loss may be carried forward for 20
years. If not utilized, this net operating loss will expire as follows:
$3,883,000 and $3,353,000 in the years ending November 30, 2029 and 2030,
respectively. As of November 30, 2011, the Company utilized its capital loss
carryforward of approximately $12,000,000. The capital gains for the year ended
November 30, 2011 have been estimated based on information currently available.
Such estimate is subject to revision upon receipt of the 2011 tax reporting
information from the individual partnerships. For corporations, capital losses
can only be used to offset capital gains and cannot be used to offset ordinary
income. As of November 30, 2011, an alternative minimum tax credit of $203,109
was available, which may be credited in the future against regular income tax.
This credit may be carried forward indefinitely.

The
aggregate cost of securities for federal income tax purposes and securities with
unrealized appreciation and depreciation, were as follows:

|                                               |  | November 30,
      2011 |            | November 30,
      2010
|---------------------------------------------- |  | ----------------------- | ---------- | -----------------------
|Aggregate cost for federal income tax purposes |  | $                       | 68,264,534 |                        
|Gross unrealized
      appreciation            |  |                         | 8,307,122  |                        
|Gross unrealized depreciation                  |  |                         | (4,883,958 | )                      
|Net unrealized
      appreciation              |  | $                       | 3,423,164  |                        
|                                               |  |                         |            |                        

6. Fair Value of Financial
Instruments

Various inputs are used in
determining the fair value of the Companys assets and liabilities. These inputs
are summarized in the three broad levels listed below:

- Level 1  quoted prices in active markets for identical
  investments
- Level 2  other significant
  observable inputs (including quoted prices for similar investments, market
  corroborated inputs,etc.)
- Level 3  significant unobservable
  inputs (including the Companys own assumptions in determining the fair value
  ofinvestments)

F-13

---



Valuation
TechniquesIn general, and
where applicable, the Company uses readily available market quotations based
upon the last updated sales price from the principal market to determine fair
value. This pricing methodology applies to the Companys Level 1 trading
securities.

The Companys other equity
securities are classified as Level 3. See discussion of the valuation technique
and assumptions in Note 2.

The inputs or methodology
used for valuing securities are not necessarily an indication of the risk
associated with investing in those securities. The following tables provide the
fair value measurements of applicable Company assets and liabilities by level
within the fair value hierarchy as of November 30, 2011 and November 30, 2010.
These assets and liabilities are measured on a recurring basis.

|November 30,
      2011 |  |                         |            |         |   |            |  |         |   |  |  
|----------------------- |  | ----------------------- | ---------- | ------- | - | ---------- |  | ------- | - |  | -
|                        |  |                         |            |         |   |            |  |         |   |  |  
|                        |  | Fair Value at           |            |         |   |            |  |         |   |  |  
|Description             |  | November 30,
      2011 |            | Level 1 |   | Level 2    |  | Level 3
|Assets:                 |  |                         |            |         |   |            |  |         |   |  |  
|Trading Securities      |  | $                       | 27,037,642 |         | $ | 27,037,642 |  | $       |  |  | $
|Other Equity Securities |  |                         | 41,856,730 |         |   |           |  |         |  |  |  
|Total
      Assets      |  | $                       | 68,894,372 |         | $ | 27,037,642 |  | $       |  |  | $
|                        |  |                         |            |         |   |            |  |         |   |  |  
|November 30,
      2010 |  |                         |            |         |   |            |  |         |   |  |  
|                        |  |                         |            |         |   |            |  |         |   |  |  
|                        |  | Fair Value at           |            |         |   |            |  |         |   |  |  
|Description             |  | November 30,
      2010 |            | Level 1 |   | Level 2    |  | Level 3
|Assets:                 |  |                         |            |         |   |            |  |         |   |  |  
|Trading Securities      |  | $                       | 20,806,821 |         | $ | 20,806,821 |  | $       |  |  | $
|Other Equity Securities |  |                         | 72,929,409 |         |   |           |  |         |  |  |  
|Total
      Assets      |  | $                       | 93,736,230 |         | $ | 20,806,821 |  | $       |  |  | $
|                        |  |                         |            |         |   |            |  |         |   |  |  

The changes for all Level 3
assets measured at fair value on a recurring basis using significant
unobservable inputs for the years ended November 30, 2011 and November 30, 2010,
are as follows:

|                                                                                 |  | Year ended              |             | Year ended             
|-------------------------------------------------------------------------------- |  | ----------------------- | ----------- | -----------------------
|                                                                                 |  | November 30,
      2011 |             | November 30,
      2010
|Fair value beginning balance                                                     |  | $                       | 72,929,409  |                        
|Total realized
      and unrealized gains included in net income                 |  |                         | 1,026,134   |                        
|Purchases                                                                        |  |                         | 20,987,605  |                        
|Sales                                                                            |  |                         | (42,275,886 | )                      
|Return of capital adjustments impacting cost basis of
      securities           |  |                         | (1,518,285  | )                      
|Transfers
      out                                                              |  |                         | (9,292,247  | )                      
|Fair value ending balance                                                        |  | $                       | 41,856,730  |                        
|                                                                                
|The amount of total gains (losses) for the period included in net
      income   |  |                         |             |                        
|attributable to the change in unrealized
      gains (losses) relating to assets |  |                         |             |                        
|still held at the reporting date                                                 |  | $                       | (3,287,478  | )                      

The Company utilizes the
beginning of reporting period method for determining transfers between levels.
For the year ended November 30, 2011, there were transfers out of Level 3 assets
in the amount of $9,292,247, which represents the values of the Companys equity
interest in Mowood and subordinated debt issued to Mowood at the beginning of
the year that were eliminated upon consolidation. There were no transfers
between Level 1 and Level 2 for the years ended November 30, 2011 and November
30, 2010, respectively.

Certain condensed financial
information of the unconsolidated affiliates follows. The information is the
most recently available financial information for these companies, which is the
last twelve months ended September 30, 2011 for High Sierra Energy, LP and
VantaCore Partners, LP, and the last twelve months ended October 31, 2011 for
Lightfoot Capital Partners LP.

|Revenues                 | $ | 2,867,168,000 |  | Current
      Assets         | $ | 440,956,000
|------------------------ | - | ------------- |  | ---------------------------- | - | -----------
|Operating
      Expenses | $ | 151,493,000   |  | Noncurrent
      Assets      | $ | 486,214,000
|Net Income               | $ | 15,308,334    |  | Current Liabilities          | $ | 338,406,000
|                         |   |               |  | Noncurrent
      Liabilities | $ | 189,768,000
|                         |   |               |  | Partners
      Equity       | $ | 398,996,000
|                         |   |               |  |                              |   |            

F-14

---



7. Acquisition of Eastern
Interconnect Project

On June 30, 2011, the
Company purchased 100 percent ownership of a 40 percent undivided interest in
the Eastern Interconnect Project (EIP) for approximately $15.6 million,
including the assumption of $3.4 million of debt. The acquisition of the EIP was
accounted for as a business combination, in accordance with ASC 805. The Company
incurred costs of approximately $0.6 million in connection with the acquisition
which were expensed during the year ended November 30, 2011. The transaction
resulted in the acquisition of assets and liabilities as follows:

Physical assets
    $
    14,126,849Lease
      receivable
    
    711,229Intangible lease asset
    
    1,094,771Debt
    
    (3,409,000
    )Fair value premium on debt
    
    (186,493
    )Interest
      payable
    
    (87,356
    )Net cash consideration paid
    $
    12,250,000


Physical Assets:The EIP transmission assets move electricity
across New Mexico between Albuquerque and Clovis. The physical assets include
216 miles of 345 kilovolts transmission lines, towers, easement rights,
converters and other grid support components. The assets are depreciated for
book purposes over an estimated useful life of 20 years. The amount of
depreciation of leased property reflected during the year ended November 30,
2011 was $294,309.

Lease:The project is leased on a triple net basis
through April 1, 2015 to Public Service Company of New Mexico, an independent
electric utility company serving approximately 500,000 customers in New Mexico.
Public Service Company of New Mexico is a subsidiary of PNM Resources (NYSE:
PNM). At the time of expiration of the lease, the Company may choose to renew
the lease with the lessee, the lessee may offer to repurchase the EIP, or the
lease can be allowed to expire and the Company will find another lessee. Under
the terms of the lease, the Company will receive semi-annual lease payments. At
the time of acquisition, the rate of the lease was determined to be above market
rates for similar leased assets and the Company recorded an intangible asset of
$1,094,771 for this premium which is being amortized as contra-lease income over
the remaining lease term.

DebtThe Company assumed a note with an outstanding
principal balance of $3.4 million. The debt is collateralized by the EIP
transmission assets. The note matures on October 1, 2012 and accrues interest at
an annual rate of 10.25 percent, with principal and interest payments due on a
semi-annual basis. At the time of acquisition, the interest rate on the assumed
debt was determined to be above market rates for similar debt and the Company
recorded an intangible of $186,493 for this premium which is being amortized as
a contra-interest expense over the remaining debt term.

8. Property and
Equipment

Property and equipment
consists of the following:

November 30,
      2011Natural gas pipeline
    
    $
    5,215,424Vehicles
    
    
    98,717Computers
    
    
    12,1505,326,291Less accumulated depreciation
    
    
    (1,483,616
    )$
    3,842,675


The amount of depreciation
of property and equipment recognized for the period from September 21, 2011
through November 30, 2011 was $69,945.

F-15

---



9. Leases

The Companys investment in
EIP is leased under net operating leases with various terms to Public Service
Company of New Mexico (PNM). PNM is referred to as the Major
Tenant.

The future contracted
minimum rental receipts for all net leases as of November 30, 2011 are as
follows:

Year Ending November
    30,
    Amount2012
    $
    2,844,9142013
    
    2,844,9142014
    
    2,844,9142015
    
    1,422,457Thereafter
    
    Total
    $
    9,957,199


In view of the fact that
the Major Tenant leases a substantial portion of the Companys net leased
property which is a significant source of revenues and operating income, its
financial condition and ability and willingness to satisfy its obligations under
its lease with the Company, have a considerable impact on the results of
operation and the Companys ability to service its indebtedness.

The Major Tenant is
currently subject to the reporting requirements of the Securities Exchange Act
of 1934, as amended, and is required to file with the SEC annual reports
containing audited financial statements and quarterly reports containing
unaudited financial statements. The audited financial statements and unaudited
financial statements of the Major Tenant can be found on the SECs website at
www.sec.gov. The Company makes no representation as to the accuracy or
completeness of the audited and unaudited financial statements of the Major
Tenant but has no reason not to believe the accuracy or completeness of such
information. In addition, the Major Tenant has no duty, contractual or
otherwise, to advise the Company of any events that might have occurred
subsequent to the date of such financial statements which could affect the
significance or accuracy of such information. None of the information in the
public reports of the Major Tenant that are filed with the SEC is incorporated
by reference into, or in any way form part of this filing.

On December 31, 2009,
Mowood sold one of its wholly owned subsidiaries to an unrelated third party. As
part of that agreement, Mowood assumed a lease obligation, including insurance
and other maintenance costs, for office space to be used by the sold subsidiary
through April 2013. The fair value of the future minimum lease payments and
estimated costs were recorded as a liability upon the sale of the
subsidiary.

|Years Ending November
    30, |  | Lease
    Obligation |         | Interest
    Portion |   | Estimated
      Expenses |   | Total
    Obligation
|----------------------------- |  | -------------------- | ------- | -------------------- | - | ------------------------ | - | --------------------
|2012                          |  | $                    | 80,453  |                      | $ | (2,948                   | ) |                     
|2013                          |  |                      | 27,079  |                      |   | (238                     | ) |                     
|                              |  | $                    | 107,532 |                      | $ | (3,186                   | ) |                     
|                              |  |                      |         |                      |   |                          |   |                     

10. Intangibles

The Company has recorded an
intangible lease asset for the fair value of the amount by which the remaining
contractual lease payments exceed market lease rates at the time of acquisition.
The intangible lease asset is being amortized on a straight-line basis over the
life of the lease term, which expires on April 1, 2015. Amortization of the
intangible lease asset is reflected in the accompanying Consolidated Statements
of Income as a reduction to lease income.

Intangible
      lease assetBalance at June 30, 2011
    $
    1,094,771Less accumulated
      depreciation
    
    (121,641
    )Balance at November 30, 2011
    $
    973,130


Estimated amortization
expense for the five years succeeding November 30, 2011 are as
follows:

Year Ending November
    30,
    Amount2012
    $
    291,9392013
    
    291,9392014
    
    291,9392015
    
    97,3132016
    
    Total
    $
    973,130


F-16

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11. Credit Facilities

On November 30, 2011, the
Company entered into a 180-day rolling evergreen margin loan facility with Bank
of America, N.A. The terms of the agreement provide for a $10,000,000 facility
that is secured by certain of the Companys assets. Outstanding balances
generally will accrue interest at a variable rate equal to one-month LIBOR plus
0.75 percent and unused portions of the facility will accrue a fee equal to an
annual rate of 0.25 percent. The Company did not have any borrowings outstanding
as of November 30, 2011. As of November 30, 2011, the Company had segregated
trading securities with an aggregate value of $1,245,350 to serve as collateral
for potential borrowings under the loan facility.

On October 29, 2011, Mowood
entered into a revolving note payable with a financial institution with a
maximum borrowing base of $1,250,000. Borrowings on the note are secured by all
of Mowoods assets. Interest accrues at LIBOR, plus a 400 percent margin (4.25
percent at November 30, 2011), is payable monthly, with all outstanding
principal and accrued interest payable on October 29, 2012. There are no
outstanding borrowings under this agreement at November 30, 2011. The agreement
contains various restrictive covenants, with the most significant relating to
minimum consolidated fixed charge ratio, the incidence of additional
indebtedness, member distributions, extension of guaranties, future investments
in other subsidiaries and change in ownership.

12. Warrants

At November 30, 2011 and
November 30, 2010, the Company had 945,594 warrants issued and outstanding. The
warrants were issued to stockholders that invested in the Companys initial
private placements and became exercisable on February 7, 2007 (the closing date
of the Companys initial public offering of common shares), subject to a lock-up
period with respect to the underlying common shares. Each warrant entitled the
holder to purchase one common share at the exercise price of $15.00 per common
share. Warrants were issued as separate instruments from the common shares and
are permitted to be transferred independently from the common shares. The
warrants have no voting rights and the common shares underlying the unexercised
warrants have no voting rights until such common shares are received upon
exercise of the warrants.

On April 8, 2011, a
proposal was approved by the Companys stockholders which allowed the Company to
amend the exercise price of its outstanding warrants from $15.00 per common
share to an amount equal to the greater of the market price of the Companys
common shares on the New York Stock Exchange or NAV, each as determined at the
end of the fiscal quarter immediately following approval of the proposal, plus
7.0 percent, and to extend the expiration date of such warrants by one year.
Based on these guidelines, the exercise price of the warrants was changed to
$11.41 per common share as of May 31, 2011. All warrants expire on February 6,
2014. This modification was not material to the financial statements.

13. Earnings Per
Share

The following table sets
forth the computation of basic and diluted earnings per share:

|                                                   |  | For the year ended      |           | For the year ended      |   | For the year ended     
|-------------------------------------------------- |  | ----------------------- | --------- | ----------------------- | - | -----------------------
|                                                   |  | November 30,
      2011 |           | November 30,
      2010 |   | November 30,
      2009
|Net income                                         |  | $                       | 2,922,143 |                         | $ | 14,666,874             
|Basic and
      diluted weighted average shares(1) |  |                         | 9,159,809 |                         |   | 9,107,070              
|Basic and diluted earnings per share               |  | $                       | 0.32      |                         | $ | 1.61                   

|(1) | Warrants to purchase shares of
      common stock were outstanding during the periods reflected in the table
      above, but were not included in the computation of diluted earnings per
      share because the warrants exercise price was greater than the average
      market value of the common shares and, therefore, the effect would be
      anti-dilutive.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

F-17

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14. Quarterly Financial Data
(Unaudited)

Summarized unaudited
quarterly financial data:

|                                                    |  |                         |           | **For the Fiscal Quarter Ended** |  |                    
|--------------------------------------------------- |  | ----------------------- | --------- | -------------------------------- |  | -------------------
|                                                    |  | February 28,
      2011 |           | May 31, 2011                     |  | August 31,
    2011
|Sales revenue                                       |  | $                       |          |                                  |  | $                  
|Lease
      income                                  |  |                         |          |                                  |  |                    
|Total revenue                                       |  |                         |          |                                  |  |                    
|Cost of
      sales                                 |  |                         |          |                                  |  |                    
|Management fees, net of expense reimbursements      |  |                         | 234,680   |                                  |  |                    
|All other
      expenses                            |  |                         | 153,843   |                                  |  |                    
|Total expenses                                      |  |                         | 388,523   |                                  |  |                    
|Income (loss)
      from operations                 |  |                         | (388,523  | )                                |  |                    
|Realized and unrealized gain (loss) on securities   |  |                         |           |                                  |  |                    
|transactions, before income
taxes                   |  |                         | 677,745   |                                  |  |                    
|Distributions
      and dividend income, net        |  |                         | 561,786   |                                  |  |                    
|Other income                                        |  |                         |          |                                  |  |                    
|Total other income (loss)                           |  |                         | 1,239,531 |                                  |  |                    
|Income (loss) before income taxes                   |  |                         | 851,008   |                                  |  |                    
|Current and deferred tax benefit (expense),
    net |  |                         | 262,262   |                                  |  |                    
|Net income (loss)                                   |  | $                       | 1,113,270 |                                  |  | $                  
|Basic and diluted earnings per share                |  | $                       | 0.12      |                                  |  | $                  
|                                                    |  |                         |           |                                  |  |                    

|(1) | Results of operations for the
      fiscal quarter ended November 30, 2011 reflect the consolidation of the
      Companys wholly owned subsidiary, Mowood, LLC, effective September 21,
      2011.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                                        |  |                         |           |              |  |                     | For the Fiscal Quarter Ended |                         |  |   |            |  
|------------------------------------------------------- |  | ----------------------- | --------- | ------------ |  | ------------------- | ---------------------------- | ----------------------- |  | - | ---------- | -
|                                                        |  | February 28,
      2010 |           | May 31, 2010 |  | August 31,
    2010 |                              | November 30,
      2010
|Total revenue                                           |  | $                       |          |              |  | $                   |                             |                         |  | $ |           |  
|Management fees,
      net of expense reimbursements    |  |                         | 258,268   |              |  |                     | 258,087                      |                         |  |   | 191,174    |  
|All other expenses                                      |  |                         | 220,187   |              |  |                     | 255,058                      |                         |  |   | 370,734    |  
|Total expenses                                          |  |                         | 478,455   |              |  |                     | 513,145                      |                         |  |   | 561,908    |  
|Income (loss) from operations                           |  |                         | (478,455  | )            |  |                     | (513,145                     | )                       |  |   | (561,908   | )
|Realized and
      unrealized gain (loss) on securities |  |                         |           |              |  |                     |                              |                         |  |   |            |  
|transactions, before income taxes                       |  |                         | 4,529,473 |              |  |                     | (6,711,026                   | )                       |  |   | 11,649,852 |  
|Distributions and dividend income, net                  |  |                         | 681,764   |              |  |                     | 380,495                      |                         |  |   | 14,865     |  
|Other
      income                                      |  |                         | 10,392    |              |  |                     | 8,688                        |                         |  |   | 8,000      |  
|Total other income (loss)                               |  |                         | 5,221,629 |              |  |                     | (6,321,843                   | )                       |  |   | 11,672,717 |  
|Income (loss) before income taxes                       |  |                         | 4,743,174 |              |  |                     | (6,834,988                   | )                       |  |   | 11,110,809 |  
|Current
    and deferred tax benefit (expense), net     |  |                         | (725,651  | )            |  |                     | (445,382                     | )                       |  |   | (567,618   | )
|Net income
      (loss)                                 |  | $                       | 4,017,523 |              |  | $                   | (7,280,370                   | )                       |  | $ | 10,543,191 |  
|Basic and diluted earnings per share                    |  | $                       | 0.44      |              |  | $                   | (0.80                        | )                       |  | $ | 1.16       |  
|                                                        |  |                         |           |              |  |                     |                              |                         |  |   |            |  

F-18

---



15. Subsequent Events

On December 1, 2011, the
Company terminated its Investment Advisory Agreement with the Adviser and
executed a Management Agreement with Corridor InfraTrust Management, LLC
(Corridor). The terms of the new Management Agreement include a quarterly
management fee equal to 0.25 percent (1.00 percent annualized) of the value of
the Companys average monthly managed assets for such quarter. Managed assets
means all of the securities of the Company and all of the real property assets
of the Company (including any securities or real property assets purchased with
or attributable to any borrowed funds) minus all of the accrued liabilities
other than (1) deferred taxes and (2) debt entered into for the purpose of
leverage. The Management Agreement also includes a quarterly incentive fee of 10
percent of the increase in distributions paid over a threshold distribution
equal to $0.125 per share per quarter. The Management Agreement also requires at
least half of any incentive fees to be reinvested in the Companys common stock.
In addition, the Company entered into a new Advisory Agreement by and among the
Company, Tortoise Capital Advisors, L.L.C. and Corridor under which Tortoise
Capital Advisors, L.L.C. will provide certain securities focused investment
services necessary to evaluate, monitor and liquidate the Companys remaining
securities portfolio and also provide the Company with certain operational (i.e.
non-investment) services. Corridor will compensate Tortoise Capital Advisors,
L.L.C. for such services provided to the Company.

On January 25, 2012, the
Company filed an amended shelf registration statement with the Securities and
Exchange Commission for the purposes of raising additional capital.

On February 6, 2012, the
Company declared a $0.11 per share distribution to be paid on March 1, 2012 to
stockholders of record on February 22, 2012.

The Company performed an
evaluation of subsequent events through the date the financial statements were
issued and determined that no additional items require recognition or
disclosure.

This Amendment No. 1 to the Annual Report on Form 10-K (the “Amendment”) of Tortoise Capital Resources
Corporation (the “Company,” “we” or “us”) amends the Company’s Annual Report on Form
10-K for the fiscal year ended November 30, 2011 that was originally filed with the Securities and Exchange Commission (the “Commission”)
on February 13, 2012 (the “Original 10-K”). This Amendment is being filed solely to (i) appropriately classify Deferred
Tax Benefit of $557,017, $708,217 and $313,024 for the years ended November 30, 2011, 2010 and 2009, respectively, and move such
amounts from Loss from Operations and into Deferred Tax Expense on the Consolidated Statements of Income in accordance with Rule
5-03 of Regulation S-X, (ii) to revise the subtotal for Net Cash Provided by Operating Activities for the Year Ended November 30,
2011 within the Consolidated Statements of Cash Flows of $1,576,222 to reflect the sum of the components of that subsection of
the statement of $2,762,446, (iii) to revise certain condensed financial information of the Company’s unconsolidated affiliates
included in Footnote 6 to the financial statements to describe the dates for which financial information of unconsolidated affiliates
is available and to add detail of operating expenses, net income, current and noncurrent assets and current and noncurrent liabilities
to comply with to the requirements of Rule 4-08(g) of Regulation S-X, and (iv) to revise the Company’s outlook with respect
to obtaining real estate investment trust (“REIT”) status. These changes did not impact net income or earnings per
share amounts.

F-19

---



ADDITIONAL
INFORMATION(Unaudited)

Officers and Directors as of
December 1, 2011

Name
    TTO PositionConrad S. Ciccotello
    DirectorJohn R.
      Graham
    DirectorCharles E. Heath
    DirectorRichard C.
      Green
    Director and
      Chairman of the BoardDavid J. Schulte
    Director and Chief Executive OfficerTerry C.
      Matlack
    Chief Financial
      OfficerEdward Russell
    PresidentDavid
      Haley
    Senior Vice
      PresidentRebecca M. Sandring
    TreasurerP. Bradley
      Adams
    Assistant
      TreasurerConnie J. Savage
    SecretaryDiane M.
      Bono
    Assistant
      Secretary


Director and Officer
Compensation

The Company does not
compensate any of its directors who are interested persons (as defined in
Section 2 (a) (19) of the 1940 Act) or any of its officers. For the year ended
November 30, 2011, the aggregate compensation paid by the Company to the
independent directors was $69,000. The Company did not pay any special
compensation to any of its directors or officers.

Forward-Looking
Statements

This report contains
forward-looking statements. By their nature, all forward-looking statements
involve risk and uncertainties, and actual results could differ materially from
those contemplated by the forward-looking statements.

Certifications

The Companys Chief
Executive Officer submitted to the New York Stock Exchange the annual CEO
certification as required by Section 303A.12(a) of the NYSE Listed Company
Manual.

The Company has filed with
the SEC the certification of its Chief Executive Officer and Chief Financial
Officer required by Section 302 of the Sarbanes-Oxley Act.

Proxy Voting Policies

A description of the
policies and procedures that the Company uses to determine how to vote proxies
relating to portfolio securities owned by the Company is available to
stockholders (i) without charge, upon request by calling the Company at (913)
981-1020 or toll-free at (866) 362-9331 and on the Companys Web site at
www.tortoiseadvisors.com/tto.cfm; and (ii) on the SECs Web site at
www.sec.gov.

Privacy Policy

The Company is committed to
maintaining the privacy of its stockholders and safeguarding their non-public
personal information. The following information is provided to help you
understand what personal information the Company collects, how the Company
protects that information and why, in certain cases, the Company may share
information with select other parties.

Generally, the Company does
not receive any non-public personal information relating to its stockholders,
although certain non-public personal information of its stockholders may become
available to the Company. The Company does not disclose any non-public personal
information about its stockholders or a former stockholder to anyone, except as
required by law or as is necessary in order to service stockholder accounts (for
example, to a transfer agent).

The Company restricts
access to non-public personal information about its stockholders to employees of
its Adviser with a legitimate business need for the information. The Company
maintains physical, electronic and procedural safeguards designed to protect the
non-public personal information of its stockholders.

Automatic Dividend Reinvestment
Plan

If a stockholders shares
of common stock (common shares) of the Company are registered directly with
the Company or with a brokerage firm that participates in the Automatic Dividend
Reinvestment Plan (the Plan) through the facilities of the Depository Trust
Company and such stockholders account is coded dividend reinvestment by such
brokerage firm, all distributions are automatically reinvested for stockholders
by the Plan Agent, Computershare Trust Company, Inc. (the Agent) in additional
common shares (unless a stockholder is ineligible or elects
otherwise).

The Company will use
primarily newly-issued shares of the Companys common stock to implement the
Plan, whether its shares are trading at a premium or discount to net asset value
(NAV). However, the Company reserves the right to instruct the Agent to
purchase shares in the open market in connection with the Companys obligations
under the Plan. The number of

F-20

---



newly issued shares will be
determined by dividing the total dollar amount of the distribution payable to
the participant by the closing price per share of the Companys common stock on
the distribution payment date, or the average of the reported bid and asked
prices if no sale is reported for that day. If distributions are reinvested in
shares purchased on the open market, then the number of shares received by a
stockholder shall be determined by dividing the total dollar amount of the
distribution payable to such stockholder by the weighted average price per share
(including brokerage commissions and other related costs) for all shares
purchased by the Agent on the open-market in connection with such distribution.
Such open-market purchases will be made by the Agent as soon as practicable, but
in no event more than 30 days after the distribution payment date.

There will be no brokerage
charges with respect to shares issued directly by us as a result of
distributions payable either in shares or in cash. However, each participant
will pay a pro rata share of brokerage commissions incurred with respect to the
Plan Agents open-market purchases in connection with the reinvestment of
distributions. If a participant elects to have the Plan Agent sell part or all
of his or her common shares and remit the proceeds, such participant will be
charged his or her pro rata share of brokerage commissions on the shares sold
plus a $15.00 transaction fee. The automatic reinvestment of distributions will
not relieve participants of any federal, state or local income tax that may be
payable (or required to be withheld) on such distributions.

Participation in the Plan
is completely voluntary and may be terminated at any time without penalty by
giving notice in writing to the Agent at the address set forth below, or by
contacting the Agent as set forth below; such termination will be effective with
respect to a particular distribution if notice is received prior to the record
date for such distribution.

Additional information
about the Plan may be obtained by writing to Computershare Trust Company, N.A.,
P.O. Box 43078, Providence, Rhode Island 02940-3078, by contacting them by phone
at (800) 426-5523, or by visiting their Web site atwww.computershare.com.

F-21

---



Tortoise Capital Resources
      Corporation


SIGNATURES

Pursuant to the
requirements of Section 13 or 15(d) 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.

TORTOISE CAPITAL RESOURCES
      CORPORATION(Registrant)By:
    /s/David J.
      SchulteDavid J.
    SchulteDirector and Chief Executive
      Officer


May 1, 2012


Pursuant to the requirements of the
Securities Exchange Act of 1934, this report has been signed below by the
following persons on behalf of the company and in the capacities indicated on
May 1, 2012.



Signature
    
    Capacity/s/Terry C.Matlack
    
    
    Chief Financial
    Officer(Principal Financial and
      Accounting Officer)/s/David J.Schulte
    
    
    Director and Chief Executive
    Officer(Principal Executive
      Officer)/s/Conrad S.Ciccotello *
    
    
    Director/s/John R.Graham *
    
    
    Director/s/Charles E.Heath *
    
    
    Director/s/Richard C.
      Green *
    
    
    Director


* By David J. Schulte pursuant to Power of Attorney, filed with Registrants Form 10-K on February 13, 2012.

F-22

---