EX-10.2






SECURITY AGREEMENT




THIS SECURITY AGREEMENT, dated as of the 31st day of December, 2007 (the
“Agreement”), is made among MAIN STREET CAPITAL CORPORATION, a Maryland corporation (the
“Grantor”), and BRANCH BANKING AND TRUST COMPANY (“BB&T”), acting as agent (in such
capacity, the “Administrative Agent”) for itself and for the other Secured Parties as
defined herein.



W I T N E S S E T H

:




RECITALS:




WHEREAS, the Administrative Agent and the Lenders (as defined in the Credit Agreement defined
below) have agreed to extend credit to the Borrower (as defined in the Credit Agreement) pursuant
to the terms of that certain Treasury Secured Revolving Credit Agreement of even date herewith (as
amended, restated, or otherwise modified from time to time, the “Credit Agreement”) among
the Grantor, the initial guarantor party thereto, the Administrative Agent and the Lenders
signatory thereto;



WHEREAS, the obligations of the Administrative Agent and the Lenders to extend credit under
the Credit Agreement and the other Loan Documents are conditioned upon, among other things, the
execution and delivery by the Grantor of a security agreement in the form hereof to secure (a) the
due and punctual payment by the Borrower of: (i) the principal of and interest on the Notes
(including without limitation, any and all Revolver Advances), when and as due, whether at
maturity, by acceleration, upon one or more dates set for prepayment or otherwise and any renewals,
modifications or extensions thereof, in whole or in part; (ii) each payment required to be made by
the Borrower under the Credit Agreement, when and as due, including payments in respect of
reimbursement of disbursements, interest thereon, and obligations, if any, to provide cash
collateral and any renewals, modifications or extensions thereof, in whole or in part; and (iii)
all other monetary obligations of the Borrower to the Secured Parties under the Credit Agreement
and the other Loan Documents to which the Borrower is or is to be a party and any renewals,
modifications or extensions thereof, in whole or in part; (b) the due and punctual performance of
all other obligations of the Borrower under the Credit Agreement and the other Loan Documents to
which the Borrower is or is to be a party, and any renewals, modifications or extensions thereof,
in whole or in part; and (c) the due and punctual payment and performance of all obligations of the
Guarantor under the Credit Agreement and the other Loan Documents to which they are or are to be a
party and any and all renewals, modifications or extensions thereof, in whole or in part (all the
foregoing indebtedness, liabilities and obligations being collectively called the
“Obligations”).



NOW, THEREFORE, in consideration of the premises and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged by the Grantor and the Administrative
Agent, the parties agree as follows:



1. Definitions. As herein used, the following terms shall have the following
meanings:



(a) “Cash Collateral” shall have the meaning set forth in the Credit Agreement.



(b) “Collateral” means all of Grantor’s rights in and to each of the following,
whether now owned or held by Grantor or hereafter acquired: (i) the Securities Account and any and
all assets and other property, tangible or intangible, now existing or hereafter arising,
maintained in, credited to or recorded in the Securities Account, including without limitation any
and all Investment Property, Treasury Securities, securities and other financial assets maintained
in, recorded in, credited to or contained therein (including, without limitation, the Cash
Collateral); (ii) any and all Security Entitlements with respect to the financial assets maintained
in, recorded in or credited to the Securities Account; (iii) any and all other Investment Property
or assets from time to time maintained in, credited to or recorded in the Securities Account; (iv)
any and all cash and cash equivalents from time to time maintained in, credited to or recorded in
the Securities Account; (v) all Supporting Obligations which relate to, arise from or are in
connection with the assets maintained in, credited to or recorded in the Securities Account; (vi)
all replacements or substitutions for any of the foregoing; and (vii) all proceeds and products of
any of the foregoing and the proceeds and products of other proceeds and products. The parties
hereby expressly agree that all property at any time held in the Securities Account is to be
treated as a “finanical asset.”



(c) “Credit Documents” means the Credit Agreement, the Notes, the Collateral Documents
and all other Loan Documents.



(d) “Event of Default” shall have the meaning assigned to it in Section 6 hereof.



(e) “Executive Office” shall have the meaning assigned to it in Section 5 hereof.



(f) “Financial Assets” means any and all financial assets (as that term is defined in
the U.C.C.).



(g) “Investment Property” means any and all investment property (as that term is
defined in the U.C.C.).



(h) “Obligations” has the meaning set forth in the Recitals.



(i) “Person” means an individual, a corporation, a limited liability company, a
government or governmental subdivision or agency or instrumentality, a business trust, an estate, a
trust, a partnership, a cooperative, an association, two or more Persons having a joint or common
interest or any other legal or commercial entity.



(j) “Proceeds” means any and all proceeds (as that term is defined in the U.C.C.),
including without limitation, whatever is received when Collateral is sold, exchanged, collected or
otherwise disposed of.



(k) “Secured Parties” means collectively (a) the Lenders party to the Credit
Agreement, and (b) the Administrative Agent in its capacity as such under the Credit Agreement,
this Agreement, the Collateral Documents and each other Loan Document, and (c) the successors and
assigns of the foregoing.



(l) “Securities Account” means that certain securities account no. 1582000060 and all
subaccounts related thereto maintained with or held by Securities Intermediary pursuant to an
agreement between Securities Intermediary and Grantor dated as of December 31, 2007 and any and all
modifications, supplements, consolidations, renewals and substitutions thereto or replacements
thereof.



(m) “Security Entitlement” means any and all securities entitlements (as that term is
defined in the U.C.C.).



(n) “Securities Intermediary” means Branch Banking and Trust Company, by and through
its Corporate Trust Services Department.



(o) “Supporting Obligations” means any and all supporting obligations (as that term is
defined in the U.C.C.).



(p) “Treasury Securities” shall mean Treasury Securities of the United States maturing
within 90 days of the date of acquisition thereof.



(q) “U.C.C.” means the Uniform Commercial Code as in effect in the State of North
Carolina.



Terms used herein and not otherwise defined herein shall have the meanings set forth in the
Credit Agreement. The rules of interpretation specified in Section 9.15 of the Credit Agreement
shall be applicable to this Agreement.



2. Security Interest. In consideration of and in order to secure the fulfillment,
satisfaction, payment and performance of all of the Obligations, the Grantor hereby assigns,
pledges, hypothecates and sets over to the Administrative Agent, its successors and its assigns,
for the benefit of the Secured Parties, and grants to the Administrative Agent, its successors and
its assigns, for the benefit of the Secured Parties, a security interest in all of the Collateral.



3. Care of Collateral. The Grantor has the risk of loss of the Collateral. The
Administrative Agent shall have no duty of care with respect to the Collateral, except that the
Administrative Agent shall exercise reasonable care with respect to Collateral in its custody, but
shall be deemed to have exercised reasonable care if such property is accorded treatment
substantially equal to that which the Administrative Agent accords its own property, or if the
Administrative Agent takes such action with respect to the Collateral as a Grantor shall request in
writing but no failure to comply with any such request nor any omission to do any such act
requested by a Grantor shall be deemed a failure to exercise reasonable care, nor shall the
Administrative Agent’s failure to take steps to collect any income accruing on the Collateral or to
preserve rights against any parties or property be deemed a failure to have exercised reasonable
care with respect to Collateral in its custody. The rights and security interest herein provided
are granted as security only and shall not subject the Administrative Agent or any Secured Party
to, or in any way alter or modify, any obligation or liability of the Grantor with respect to or
arising out of any of the Collateral.



4. [Intentionally deleted]



5. Representations, Warranties and Covenants as to Collateral.



The Grantor represents, warrants and covenants to and for the benefit of the Administrative
Agent and the Secured Parties as of the date hereof and as of the date of each Advance under the
Credit Agreement that:



(a) Cash Collateral. Any Cash Collateral included in the calculation of the Cash
Collateral Coverage Ratio under the Credit Agreement constitute Collateral as defined herein.



(b) Good Title; No Existing Encumbrances. The Grantor owns the Collateral free and
clear of any prior lien, and no financing statements or other evidences of the grant of a security
interest respecting the Collateral exist on the public records.



(c) Right to Grant Security Interest; No Further Encumbrances. The Grantor has the
right to grant a security interest in the Collateral. Except as permitted by the Credit Agreement,
the Grantor will pay all taxes and other charges against the Collateral, and the Grantor will not
use the Collateral illegally or allow the Collateral to be encumbered.



(d) Location of Collateral; Location of Executive Office. The Grantor hereby
represents and warrants to the Administrative Agent and the Lenders that, as of the date hereof,
the Collateral is entirely contained within, recorded in, or credited to, the Securities Account,
and the Grantor covenants with the Administrative Agent not to transfer the Collateral to any other
account. The executive office of the Grantor set forth on Schedule I hereto (the “Executive
Office”) is the Grantor’s chief executive office (if the Grantor has more than one place of
business).



(e) Collateral Status. The Grantor will promptly notify the Administrative Agent if
there is any adverse change in the status of the Collateral that would reasonably be expected to
have a Material Adverse Effect.



(f) Delivery of Certain Collateral. Upon the reasonable request of the Administrative
Agent, the Grantor shall deliver all items the physical possession of which is necessary in order
for the Administrative Agent, on behalf of the Secured Parties, to perfect or preserve the priority
of its security interest in the Collateral.



(g) Records Respecting Collateral. The Grantor shall keep complete and accurate books
and records and make all necessary entries thereon to reflect the transactions and facts giving
rise to the Collateral and payments, credits and adjustments applicable thereto, all in accordance
with GAAP. All books and records of the Grantor with respect to the Collateral will be accessible
from the Executive Office (as it may be changed pursuant to Section 5(c)).



(h) Further Assurances. The Grantor shall execute and/or deliver (or cause to be
executed and/or delivered) to the Administrative Agent and Secured Parties any instrument,
document, financing statement, assignment, waiver, consent or other writing reasonably requested by
the Administrative Agent which may be reasonably necessary to the Administrative Agent to carry out
the terms of this Agreement and any of the other Loan Documents and to perfect its security
interest in and facilitate the collection of the Collateral, the proceeds thereof, and any other
property at any time constituting security to the Secured Parties. The Grantor shall perform or
cause to be performed such acts as the Administrative Agent or any Secured Party may reasonably
request to establish and maintain for the Administrative Agent and the Secured Parties a valid and
perfected security interest in and security title to the Collateral, free and clear of any liens.



(i) Maintenance of Insurance. Grantor shall maintain, or cause to be maintained,
insurance as required under the Credit Agreement. The Grantor shall deliver to the Administrative
Agent on or before the date of the first Borrowing under the Credit Agreement, and at such other
times as the Administrative Agent may request, a detailed list of such insurance then in effect
stating the names of the insurance companies, the amounts and rates of insurance, the date of
expiration thereof, the properties and risks covered thereby and the insured with respect thereto.
The Grantor will pay all premiums on the insurance referred to herein as and when they become due
and shall do all things necessary to maintain the insurance in effect.



(j) Change of Chief Executive Office. The Grantor hereby understands and agrees that
if, at any time hereafter, the Grantor elects to move its Executive Office, or if the Grantor
elects to change its name, identity, state of incorporation or organization, or its structure to
other than as existing on the date hereof, the Grantor will notify the Administrative Agent in
writing at least thirty (30) days prior thereto.



(k) Control Agreements. The Grantor will obtain and deliver or cause to be delivered
to the Administrative Agent, an account control agreement in form and substance satisfactory to
Administrative Agent with respect to the Securities Account (“Control Agreement”).



(l) Business Purpose. None of the Obligations is a Consumer Transaction, as defined
in the U.C.C. and none of the Collateral has been or will be purchased or held primarily for
personal, family or household purposes.



6. Events of Default. The happening of any one or more of the following events shall
constitute an Event of Default hereunder: (a) the nonpayment when due of any of the Obligations
which nonpayment is not fully cured within the applicable grace period therefor, if any, or
(b) the occurrence of an Event of Default (as defined in the Credit Agreement).



7. Remedies. Upon the occurrence of an Event of Default and during the continuation
thereof, the Administrative Agent shall have all of the rights and remedies available at law
(including, without limitation, those provided to a secured party by the U.C.C.), or in equity to
collect, enforce or satisfy any Obligations then owing, whether by acceleration or otherwise. In
addition thereto, the Grantor further agrees that (i) in the event that notice is necessary under
applicable law, written notice mailed to Grantor at the Grantor’s address given below, ten (10)
business days prior to the date of sale of any of the Collateral subject to the security interest
created herein or prior to the date after which private sale or any other disposition of said
Collateral will be made shall constitute reasonable notice, but notice given in any other
reasonable manner or at any other time shall be sufficient; (ii) in the event of sale or other
disposition of any such Collateral, the Administrative Agent may apply the proceeds of any such
sale or disposition to the satisfaction of the Administrative Agent’s reasonable attorneys’ fees,
legal expenses, and other costs and expenses incurred in connection with the Administrative Agent’s
taking, retaking, holding, preparing for sale, and selling of the Collateral; (iii) without
precluding any other methods of sale, the sale of Collateral shall have been made in a commercially
reasonable manner if conducted in conformity with reasonable commercial practices of banks
disposing of similar property but in any event the Administrative Agent may sell on such terms as
the Administrative Agent may choose, without assuming any credit risk and without any obligation to
advertise or give notice of any kind; and (iv) the Administrative Agent may comply with any
applicable state or federal law requirements in connection with a disposition of the Collateral and
compliance will not be considered adversely to affect the commercial reasonableness of any sale of
the Collateral. Furthermore, in any such event, to the extent permitted under applicable law, full
power and authority are hereby given the Administrative Agent to sell, assign, and deliver the
whole of the Collateral or any part(s) thereof, at any time(s) at any broker’s board, or at public
or private sale, at the Administrative Agent’s option, and no delay on the Administrative Agent’s
part in exercising any power of sale or any other rights or options hereunder, and no notice or
demand, which may be given to or made upon any or all of the Grantor by the Administrative Agent or
any Secured Party with respect to any power of sale or other right or option hereunder, shall
constitute a waiver thereof, or limit or impair the Administrative Agent’s right to take any action
or to exercise any power of sale or any other rights hereunder, without notice or demand, or
prejudice the Administrative Agent’s rights as against the Grantor in any respect. The Grantor
hereby waives and releases to the fullest extent permitted by law any right or equity of redemption
with respect to the Collateral, whether before or after sale hereunder, and all rights, if any, of
marshaling the Collateral and any other security for the Obligations or otherwise. At any such
sale, unless prohibited by applicable law, the Administrative Agent may bid for and purchase all or
any part of the Collateral so sold free from any such right or equity of redemption. If
Administrative Agent sells any of the Collateral upon credit, the Grantor will be credited only
with payments actually made by the purchaser, received by the Administrative Agent and applied to
the indebtedness of the purchaser. In the event the purchaser fails to pay for the Collateral, the
Administrative Agent may resell the Collateral and the Grantor shall be credited with the proceeds
of the sale as and when received, less expenses. In the event the Administrative Agent purchases
any of the Collateral being sold, the Administrative Agent may pay for the Collateral by crediting
some or all of the Obligations of the Grantor. The Administrative Agent shall not be liable for
failure to collect or realize upon any or all of the Collateral or for any delay in so doing nor
shall the Administrative Agent be under any obligation to take any action whatsoever with regard
thereto. The Administrative Agent has no obligation to attempt to satisfy the Obligations by
collecting them from any other person liable for them and the Administrative Agent may release,
modify or waive any collateral provided by any other Person to secure any of the Obligations, all
without affecting the Administrative Agent’s rights against the Grantor. The Grantor waives any
right it may have to require the Administrative Agent to pursue any third Person for any of the
Obligations. The Administrative Agent may sell the Collateral without giving any warranties as to
the Collateral and may specifically disclaim any warranties of title or the like. This procedure
will not be considered adversely to affect the commercial reasonableness of any sale of the
Collateral.



8. Continuing Security Interest. Any and all of the Administrative Agent’s rights
with respect to the security interests hereunder shall continue unimpaired until the Obligations
have been fully paid and the Lenders’ obligations to extend credit to Grantor under the Credit
Agreement have irrevocably terminated, and the Grantor shall be and remain obligated in accordance
with the terms hereof, notwithstanding the release or substitution of any Collateral at any time or
of any rights or interests therein, or any delay, extension of time, renewal, compromise or other
indulgence granted by the Administrative Agent or any Secured Party in reference to any of the
Obligations, or any promissory note or instrument or Credit Document given in connection therewith,
the Grantor hereby waiving all notice of any such delay, extension, release, substitution, renewal,
compromise or other indulgence, and hereby consenting to be bound thereby as fully and effectually
as if the Grantor had expressly agreed thereto in advance.



9. No Waiver. No delay on the Administrative Agent’s part in exercising any power of
sale, option or other right hereunder, and no notice or demand which may be given to or made upon
the Grantor by the Administrative Agent, shall constitute a waiver thereof, or limit or impair the
Administrative Agent’s right to take any action or to exercise any other power of sale, option or
any other right hereunder, without notice or demand, or prejudice the Administrative Agent’s rights
as against the Grantor in any respect.



10. Financing Statements. The Grantor hereby irrevocably authorizes the
Administrative Agent at any time and from time to time to file in any relevant jurisdiction any
initial financing statements with respect to the Collateral or any part thereof and amendments
thereto that contain the information required by the U.C.C. of each applicable jurisdiction for the
filing of any financing statement or amendment, including (i) whether the Grantor is an
organization, the type of organization and any organizational identification number issued to the
Grantor, and (ii) a description of collateral that describes such property in any other manner as
the Administrative Agent may reasonably determine is necessary or advisable to ensure the
perfection of the security interest in the Collateral granted under this Agreement. The Grantor
agrees to provide such information to the Administrative Agent promptly upon request. The Grantor
agrees to reimburse the Administrative Agent for the expense of any such filings in any location
deemed necessary and appropriate by the Administrative Agent. To the extent lawful, the Grantor
hereby appoints the Administrative Agent as its attorney-in-fact (without requiring the
Administrative Agent to act as such) to perform all other acts that the Administrative Agent deems
appropriate to perfect and continue its security interest in, and to protect and preserve, the
Collateral.



11. Power of Attorney. Effective after the occurrence of an Event of Default and
during the continuation thereof, the Grantor hereby appoints any officer or agent of the
Administrative Agent as the Grantor’s true and lawful attorney-in-fact with power to endorse the
name of the Grantor upon any instruments of payment or Collateral which may come into possession of
the Administrative Agent; to give written notice to such office and officials of the United States
Postal Service to affect such change or changes of address so that all mail addressed to any or all
Grantor may be delivered directly to the Administrative Agent (the Administrative Agent will return
all mail not related to the Obligations or the Collateral); granting unto the Grantor’s said
attorney full power to do any and all things necessary to be done with respect to the above
transactions as fully and effectively as the Grantor might or could do, and hereby ratifying all
its said attorney shall lawfully do or cause to be done by virtue hereof. This power of attorney
shall be irrevocable for the term of this Agreement and all transactions hereunder.



12. Remedies, Etc., Cumulative. Each right, power and remedy of the Administrative
Agent provided for in this Agreement or the Credit Documents or in any of the other instruments or
agreements securing the Obligations or now or hereafter existing at law or in equity or by statute
shall be cumulative and concurrent and shall be in addition to every other such right, power or
remedy. The exercise or beginning of the exercise by the Administrative Agent of any one or more
of the rights, powers or remedies provided for in this Agreement, the Credit Documents or in any
such other instrument or agreement now or hereafter existing at law or in equity or by statute or
otherwise shall not preclude the simultaneous or later exercise by the Administrative Agent of all
such other rights, powers or remedies, and no failure or delay on the part of the Administrative
Agent to exercise any such right, power or remedy shall operate as a waiver thereof.



13. Continuing Agreement. This is a continuing agreement and shall remain in full
force and effect until terminated by written agreement of the parties and until all of the
principal of, premium, if any, and interest on all of the Obligations have been fully paid. This
Agreement and the liens and security interests created and granted hereunder shall remain in
effect, notwithstanding the fact that at any time or from time to time there may be no Obligations
outstanding, in order to secure all future Obligations. If this Security Agreement is revoked by
operation of law as against the Grantor, the Grantor will indemnify and save the Administrative
Agent and its successors or assigns, harmless from any loss which may be suffered or incurred by
them in making, giving, granting or extending any loans or other credit, financing or financial
accommodations, or otherwise acting, hereunder prior to receipt by the Administrative Agent of
notice in writing of such revocation.



14. Miscellaneous. This Agreement shall be governed by the laws of the State of North
Carolina in all respects, including matters of construction, validity and performance except to the
extent that the remedies provided herein with respect to any of the collateral are governed by the
laws of any jurisdiction other than North Carolina; section headings herein are for the convenience
of reference only and shall not affect the construction or interpretation of or alter or modify the
provisions of this Agreement; none of the terms or provisions of this Agreement may be waived,
altered, modified, limited or amended except by an agreement expressly referring hereto and to
which the Administrative Agent consents in writing duly signed for the Administrative Agent and on
the Administrative Agent’s behalf; the rights granted to the Administrative Agent herein shall be
supplementary and in addition to those granted to the Administrative Agent and/or the Secured
Parties in any Credit Documents; the addresses of the parties for delivery of notices, requests,
demands and other communications hereunder are as set forth in the Credit Agreement. No reference
to “proceeds” in this Agreement authorizes any sale, transfer, or other disposition of the
Collateral by the Grantor.



15. Duties of Administrative Agent. The Administrative Agent has been appointed by
the Secured Parties pursuant to the Credit Agreement. Its duties to the Secured Parties, powers to
act on behalf of the Secured Parties, and immunity are set forth solely therein, and shall not be
altered by this Security Agreement. Any amounts realized by the Administrative Agent hereunder
shall be allocated pursuant to the Credit Agreement.



[Remainder of page intentionally left blank]





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IN WITNESS WHEREOF, this Security Agreement has been executed as of the day and year first
above written.



GRANTOR:




MAIN STREET CAPITAL CORPORATION




By: /s/ Todd A. Reppert



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	 	 	Name:	 	 	Todd A. Reppert
	 	 	Title: President	 
	 	 	 	 	 	[CORPORATE SEAL]





SCHEDULE I




Executive Office




The Executive Office of the Grantor is as follows:



11300 Post Oak Boulevard, Suite 800



Houston, TX 77056



Attention: Todd A. Reppert, President




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