Document:

Filed by Bowne Pure Compliance

Exhibit 10.2

Execution version

GENERAL SECURITY AGREEMENT

THIS GENERAL SECURITY AGREEMENT, dated as of the 24th day of October, 2008 (the
“Agreement”), is made among MAIN STREET CAPITAL CORPORATION, a Maryland corporation (the
“Borrower”), MAIN STREET CAPITAL PARTNERS, LLC, a Delaware limited liability company, and
MAIN STREET EQUITY INTERESTS, INC., a Delaware corporation (collectively, the
“Guarantor-Grantors”, and the Borrower and the Guarantor-Grantors being collectively called
the “Grantors”), 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 pursuant to the terms of that certain Credit
Agreement of even date herewith (as amended, restated, or otherwise modified from time to time, the
“Credit Agreement”) among the Borrower, the Guarantor-Grantors, BB&T, as a Lender and as
Administrative Agent, and the Lenders signatory thereto;

WHEREAS, the Borrower may from time to time enter into or guarantee one or more Hedge
Transactions (as defined in the Credit Agreement) with the Hedge Counterparties (as defined in the
Credit Agreement);

WHEREAS, each of the Guarantors (as defined in the Credit Agreement) has agreed to guarantee,
among other things, all the obligations of the Borrower under the Credit Agreement and the other
Loan Documents (as defined in the Credit Agreement);

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 Grantors 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; (c) the due and punctual payment (whether at the stated
maturity, by acceleration or otherwise) of all obligations (including any and all Hedging
Obligations (as defined in the Credit Agreement) arising under Hedging Agreements and obligations
which, but for the automatic stay under Section 362(a) of the Bankruptcy Code, would become due),
indebtedness and liabilities of the Borrower, now existing or hereafter incurred under, arising out
of or in connection with any and all Hedging Agreements and any renewals, modifications or
extensions thereof (including, all obligations, if any, of the Borrower as guarantor under the
Credit Agreement in respect of Hedging Agreements), and the due and punctual performance and
compliance by the Borrower with all of the terms, conditions and agreements contained in any
Hedging Agreement and any renewals, modifications or extensions thereof; (d) the due and punctual
payment and performance of all indebtedness, liabilities and obligations of any one or more of the
Borrower and Guarantors arising out of or relating to any Bank Products; (e) the due and punctual
payment and performance of all indebtedness, liabilities and obligations of any one or more of the
Borrower and Guarantors arising out of or relating to any Cash Management Services; and (f) the due
and punctual payment and performance of all obligations of each of the Guarantors 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 Grantors and the Administrative
Agent, the parties agree as follows:

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

(a) “Account Debtor” means any Person who is or may become obligated to a Grantor
under, with respect to or on account of an Account or any Supporting Obligation related thereto.

(b) “Account” means any and all accounts (as that term is defined in the U.C.C.) of
any Grantor and includes, without limitation, all obligations of every kind at any time owing to
any Grantor, all contract rights, health care insurance receivables and any and all rights of any
Grantor to payment for goods sold or leased or for services rendered whether due or to become due,
whether or not earned by performance and whether now existing or arising in the future, including,
without limitation, Accounts from Affiliates of the Grantors.

(c) “Accounts Receivable Collateral” shall mean all obligations of every kind at any
time owing to Borrower or any Guarantor howsoever evidenced or incurred, whether or not earned by
performance, including, without limitation, all accounts, instruments, notes, drafts, acceptances,
leases, open accounts, contract rights, chattel paper (whether tangible or electronic) and general
intangibles, all returned or repossessed goods and all books, records, computer tapes, programs and
ledger books arising therefrom or relating thereto, whether now owned or hereafter acquired or
arising and all proceeds of the foregoing.

 

 

 

(d) “Chattel Paper” means any and all chattel paper (as that term is defined in the
U.C.C.), whether tangible or electronic, of any Grantor.

(e) “Collateral” means (i) all Accounts, General Intangibles, Documents, Chattel Paper
and Instruments now existing or hereafter arising of each Grantor; (ii) all guarantees of each
Grantor’s existing and future Accounts, General Intangibles, Chattel Paper and Instruments and all
other security held by any Grantor for the payment and satisfaction thereof; (iii) all Inventory
now owned or hereafter acquired by any Grantor; (iv) all Equipment now owned or hereafter acquired
of each Grantor; (v) all Intercompany Claims now existing or hereafter arising; (vi) any and all
now owned or hereafter acquired or arising Deposit Accounts, Investment Related Property, Letter of
Credit Rights, Goods (as that term is defined in the U.C.C.), Commercial Tort Claims and Supporting
Obligations; (vii) all books and records of the Grantors (including, without limitation, computer
records, tapes, discs and programs and all other media, written, electric, magnetic or otherwise,
containing such records) which relate to any Grantor’s Inventory, Equipment, Accounts, Deposit
Accounts, Investment Related Property, Letter of Credit Rights, Goods, Supporting Obligations,
General Intangibles, Chattel Paper and Instruments or guarantees thereof; (viii) all insurance on
all of the foregoing and the proceeds of that insurance; and (ix) all cash and noncash proceeds and
products of all of the foregoing and the proceeds and products of other proceeds and products.

(f) “Collateral Locations” shall have the meaning assigned in Section 6 hereof.

(g) “Commercial Tort Claims” shall mean all commercial tort claims as defined in the
U.C.C., including, without limitation, all commercial tort claims listed on Schedule III (as such
schedule may be amended or supplemented from time to time).

(h) “Commodities Accounts” (i) shall mean all commodity accounts as defined in
Article 9 of the U.C.C. and (ii) shall include, without limitation, all of the accounts listed on
Schedule II under the heading “Commodities Accounts” (as such schedule may be amended or
supplemented from time to time).

(i) “Credit Documents” means the Credit Agreement, the Notes, the Letter of Credit
Application Agreements, the Collateral Documents and all other Loan Documents.

(j) “Deposit Account” means all deposit accounts (as that term is defined in the
U.C.C.) of any Grantor, including without limitation, (i) any and all moneys, sums and amounts now
or hereafter on deposit with any Secured Party or otherwise to the credit of or belonging to any
Grantor and (ii) all of the accounts listed on Schedule II under the heading “Deposit Accounts” (as
such schedule may be amended or supplemented from time to time).

(k) “Documents” means any and all documents (as that term is defined in the U.C.C.) of
any Grantor.

 

 

 

(l) “Equipment” means any and all equipment (as that term is defined in the U.C.C.) of
any Grantor and shall include, without limitation, all equipment, machinery, appliances, tools,
motor vehicles, furniture, furnishings, floor samples, office equipment and supplies, and tangible
personal property, whether or not the same are or may become fixtures,
used or bought for use primarily in the business of any Grantor or leased by any Grantor to
or from others, of every nature, presently existing or hereafter acquired or created, wherever
located, additions, accessories and improvements thereto and substitutions therefor and all parts
which may be attached to or which are necessary for the operation and use of such personal property
or fixtures, whether or not the same shall be deemed to be affixed to real property, all
manufacturer’s warranties therefor, all parts and tools therefor, and all rights under or arising
out of present or future contracts relating to the foregoing. All equipment is and shall remain
personal property irrespective of its use or manner of attachment to real property.

(m) “Excluded Account Assets” means the cash and 90-Day Treasury Securities (as
defined in the Treasury Revolving Credit Agreement) maintained in, credited to or recorded in
Securities Account no. 1582000060 in the name of Main Street Capital Corporation and all
subaccounts related thereto maintained with or held by BB&T, by and through its Corporate Trust
Services Department, as securities intermediary.

(n) “Excluded Capital Securities” means, collectively, (A) any outstanding Capital
Securities issued by each of (i) Main Street Mezzanine Fund, LP and (ii) Main Street Mezzanine
Management, LLC and (B) any outstanding Capital Securities of a Foreign Subsidiary in excess of 65%
of the voting power of all classes of Capital Securities of such Foreign Subsidiary entitled to
vote.

(o) “Executive Office” shall have the meaning assigned to it in Section 6(d).

(p) “General Intangibles” means all general intangibles (as that term is defined in
the U.C.C.) of any Grantor (including, without limitation, all payment intangibles (as that term is
defined in the U.C.C.) and software, company records (paper and electronic), correspondence, credit
files, records and other documents, computer programs, computer software, computer tapes and cards
and other paper and documents in the possession or control of any Grantor or in the possession or
control of any affiliate or computer service bureau, and all contract rights (including, without
limitation, rights under any Hedging Transaction), claims, choses in action, bank balances,
judgments, rights as lessee under any and all leases of personal property, rights and/or claims to
tax refunds and other claims and rights to monies or property, warranties, patents, patent
applications, trademarks, trade names, trade secrets, formulas, licensing agreements, royalty
payments, copyrights, service names, customer lists, service marks, logos, goodwill, intellectual
property and deposit accounts, and all other general intangibles of every kind, type or
description).

(q) “Instruments” means all instruments (as that term is defined in the U.C.C.) of any
Grantor, including without limitation, checks, notes, certificated certificates of deposit,
investment securities, negotiable instruments and writings evidencing a right to the payment of
money of a type transferred in the ordinary course of business by delivery with any necessary
instrument or assignment.

(r) “Intercompany Claims” shall mean any and all rights of any Grantor in respect of
loans, advances or other claims owed to such Grantor by the Borrower, Guarantors or any Subsidiary
of Borrower or any Guarantor.

 

 

 

(s) “Inventory” means any and all inventory (as that term is defined in the U.C.C.) of
any Grantor and shall include, without limitation, tangible personal property held for sale or
lease or to be furnished under contracts of service, tangible personal property which any such
Grantor has so leased or furnished, and raw materials, work in process and materials used, produced
or consumed in such Grantor’s business, and shall include tangible personal property returned to
any such Grantor by a purchaser or lessor thereof following the sale or lease thereof by any such
Grantor.

(t) “Inventory Collateral” shall mean all inventory of the Borrower and Guarantors, or
in which the Borrower or Guarantors have rights, whether now owned or hereafter acquired, wherever
located, including, without limitation, all goods of the Borrower and Guarantors held for sale or
lease or furnished or to be furnished under contracts of service, all goods held for display or
demonstration, goods on lease or consignment, returned and repossessed goods, all raw materials,
work-in-process, finished goods and supplies used or consumed in the business of Borrower or any
Guarantor, together with all documents, documents of title, dock warrants, dock receipts, warehouse
receipts, bills of lading or orders for the delivery of all, or any portion, of the foregoing.

(u) “Investment Accounts” shall mean the Securities Accounts, Commodities Accounts and
Deposit Accounts.

(v) “Investment Related Property” means (i) any and all investment property (as that
term is defined in the U.C.C.) of any Grantor, including without limitation, any and all
securities, whether certificated or uncertificated, Security Entitlements, Securities Accounts,
Commodity Contracts and Commodity Accounts and (ii) all of the following (regardless of whether
classified as investment property under the U.C.C.): all (w) Pledged Equity Interests, (x) Pledged
Debt, (y) the Investment Accounts and (z) Certificates of Deposit.

(w) “Letter of Credit Rights” means any and all letter of credit rights (as that term
is defined in the U.C.C.).

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

(y) “Permitted Liens” shall have the meaning given such term in Section 6(b) hereof.

(z) “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.

(aa) “Pledged Debt” shall mean all indebtedness for borrowed money owed to a Grantor,
whether or not evidenced by any instrument or promissory note, including, without limitation, all
indebtedness described on Schedule II under the heading “Pledged Debt” (as such schedule may be
amended or supplemented from time to time), all monetary obligations owing to any Grantor from any
other Grantor (including Intercompany Claims), the instruments evidencing any of the foregoing, and
all interest, cash, instruments and other property or
proceeds from time to time received, receivable or otherwise distributed in respect of or in
exchange for any or all of the foregoing.

 

 

 

(bb) “Pledged Equity Interests” shall mean all shares of and interests in Capital
Securities owned by a Grantor, including, without limitation, all shares of and interests in
Capital Securities described on Schedule II under the heading “Pledged Equity Interests” (as such
schedule may be amended or supplemented from time to time), and the certificates, if any,
representing such shares and any interest of such Grantor in the entries on the books of the issuer
of such shares or interests or on the books of any securities intermediary pertaining to such
shares or interests, and all dividends, distributions, cash, warrants, rights, options,
instruments, securities and other property or proceeds from time to time received, receivable or
otherwise distributed in respect of or in exchange for any or all of such shares or interests and
any other warrant, right or option to acquire any of the foregoing, but excluding the Excluded
Equity Interests (as defined in the Pledge Agreement).

(cc) “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.

(dd) “Representation Date” means each of (i) the Closing Date and (ii) each Reporting
Date. As used in this definition, “Reporting Date” shall mean the date of delivery of any
amendment or supplement to the Schedules hereto in accordance with the terms of this Agreement,
which delivery shall occur not less frequently than each Fiscal Quarter and shall occur promptly,
and in any event within 20 days, following the end of each Fiscal Quarter.

(ee) “Secured Parties” means collectively (1) the Administrative Agent in its capacity
as such under the Credit Agreement, the Collateral Documents and the other Loan Documents; (2) the
Lenders, (3) the Hedge Counterparties in their capacity as such under the Hedging Agreements; (4)
any of the Lenders’ respective Affiliates as a provider of Bank Products or Cash Management
Services, as provided in the Credit Agreement; and (5) the successors and assigns of the foregoing.

(ff) “Securities Accounts” shall mean all securities accounts as defined in Article 8
of the U.C.C. and (ii) shall include, without limitation, all of the accounts listed on Schedule II
under the heading “Securities Accounts” (as such schedule may be amended or supplemented from time
to time).

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

(hh) “U.C.C.” means the Uniform Commercial Code as in effect in the State of North
Carolina or, when the context relates to perfection or priority of a security interest, the Uniform
Commercial Code as in effect from time to time in any other applicable jurisdiction.

Terms used herein and not otherwise defined herein shall have the meanings set forth in the
Credit Agreement or, if not defined therein, the U.C.C. The rules of interpretation specified in
Section 9.15 of the Credit Agreement shall be applicable to this Agreement and the
provisions of Section 1.04 of the Credit Agreement shall apply to this Agreement as if such
provisions were specifically set forth herein mutatis mutandis.

 

 

 

2. Security Interest. In consideration of and in order to secure the fulfillment,
satisfaction, payment and performance of all of the Obligations, each 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.
Notwithstanding anything herein to the contrary, Collateral shall not include, and the security
interest herein shall not attach to, (x) the Excluded Account Assets; provided
that, immediately upon payment in full and extinguishment of all the obligations owing by
Borrower and the other obligors under the Treasury Revolving Credit Agreement, the Collateral shall
include, and the security interest granted hereunder shall attach to, the Excluded Account Assets
and (y) the Excluded Capital Securities; provided that, immediately upon any
amendment, modification or repeal of the Restrictive Provisions to allow the pledge of the Excluded
Capital Securities, the Collateral shall include, and the security interest granted hereunder shall
attach to, such Capital Securities or (z) any property rights in Capital Securities (other than
Capital Securities issued by any Subsidiary), or any Operating Documents of any issuer of such
Capital Securities to which a Grantor is a party, or any of its rights or interests thereunder, if
the grant of such security interest shall constitute or result in (i) the abandonment, invalidation
or unenforceability of any right, title or interest of the Grantor therein or (ii) in a breach or
termination pursuant to the terms of, or a default under, any such property rights or Operating
Documents (other than to the extent that any such term would be rendered ineffective pursuant to
Sections 9-406, 9-407, 9-408 or 9-409 of the UCC (or any successor provisions) of any relevant
jurisdiction or any other Applicable Law (including the Bankruptcy Code) or principals of equity).

3. Care of Collateral. The Grantors have 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 any Grantor with respect to or
arising out of any of the Collateral.

4. Set-Off. In addition to the rights and security interest elsewhere herein set
forth, the Administrative Agent may, at its option at any time(s) after the occurrence of an Event
of Default and during the continuation thereof, and with or without notice to any Grantor,
appropriate and apply to the payment or reduction, either in whole or in part, of the amount owing
on any one or more of the Obligations, whether or not then due, any and all moneys now or hereafter
on deposit in a Deposit Account maintained with the Administrative Agent or
otherwise to the credit of or belonging to a Grantor in such deposit account, it being
understood and agreed that the Administrative Agent shall not be obligated to assert or enforce any
rights or security interest hereunder or to take any action in reference thereto, and that the
Administrative Agent may in its discretion at any time(s) relinquish its rights as to particular
Collateral hereunder without thereby affecting or invalidating the Administrative Agent’s rights
hereunder as to all or any other Collateral hereinbefore referred to.

 

 

 

5. Collection of Accounts and Pledged Debt; Interest and other Amounts Payable.

(a) Upon occurrence of an Event of Default and during the continuation thereof, the
Administrative Agent shall have the right at any time:

(i) to collect the Accounts and Pledged Debt, to sell, assign, compromise, discharge or extend
the time for payment of any Account or Pledged Debt, to accelerate any Pledge Debt that may be
accelerated in accordance with its terms, to institute legal action for the collection of any
Account or Pledged Debt, and to do all acts and things necessary or incidental thereto, in each
case acting if it so chooses in the name of any or all of the Grantors, and the Grantors hereby
ratify all such acts;

(ii) without notice to any Grantor, to notify the parties obligated on any of the Collateral
of the security interest in favor of the Administrative Agent created hereby and to direct all such
Persons to make payments of all amounts due thereon or thereunder directly to the Administrative
Agent or to an account designated by the Administrative Agent;

(iii) request that the Grantors notify Account Debtors and/or obligors under Pledged Debt and
indicate on all billings that payments thereon are to be made to the Administrative Agent, and the
Grantors hereby agree to make such notification and such indication on billings if so requested.
In the event Account Debtors and/or obligors under Pledged Debt are so notified, no Grantor shall
compromise, discharge, extend the time for payment or otherwise grant any indulgence or allowance
with respect to any Account or Pledged Debt without the prior written consent of the Administrative
Agent.

(b) Each Grantor irrevocably designates and appoints the Administrative Agent its true and
lawful attorney either in the name of the Administrative Agent or in the name of such Grantor,
effective after the occurrence of an Event of Default and during the continuation thereof to ask
for, demand, sue for, collect, compromise, compound, receive, receipt for and give acquittances for
any and all sums owing or which may become due upon any items of the Collateral and, in connection
therewith, to take any and all actions as the Administrative Agent may deem necessary or desirable
in order to realize upon the Collateral, including, without limitation, power to endorse in the
name of such Grantor, any checks, drafts, notes or other instruments received in payment of or on
account of the Collateral, but the Administrative Agent shall not be under any duty to exercise any
such authority or power or in any way be responsible for the collection of the any Collateral.

 

 

 

(c) All interest, income, principal, other amounts and Proceeds (including wire transfers,
checks and other instruments) that are received by any Grantor in violation of the provisions of
clause (a) shall be received in trust for the benefit of the Administrative Agent,
shall be segregated from other property or funds of the Grantors and shall be forthwith deposited
into such account or paid over or delivered to the Administrative Agent in the same form as so
received (with any necessary endorsements or assignments) to be held as Collateral and applied to
the Obligations as provided herein. The rights set forth in this Section 5 are supplementary and
in addition to (and not in limitation of) the rights granted to the Administrative Agent and/or the
Secured Parties in the Credit Documents (including, without limitation, Section 5.37 of the Credit
Agreement).

6. Representations, Warranties and Covenants as to Collateral.

Each Grantor represents, warrants and covenants to and for the benefit of the Administrative
Agent and the Secured Parties, on the date of this Agreement and on each date a Borrowing is made
or deemed made, that:

(a) Sale of Collateral. Upon the sale, exchange or other disposition of the Inventory
Collateral, the security interest and lien created and provided for herein, without break in
continuity and without further formality or act, shall continue in and attach to any proceeds
thereof, including, without limitation, accounts, chattel paper, contract rights, shipping
documents, documents of title, bills of lading, warehouse receipts, dock warrants, dock receipts
and cash or non-cash proceeds, and in the event of any unauthorized sale, shall continue in the
Inventory Collateral itself.

(b) Good Title; No Existing Encumbrances. The Grantors own their respective items of
Collateral free and clear of any prior Lien other than Liens permitted by Section 5.13 of the
Credit Agreement (referred to herein as the “Permitted Liens”), and no financing statements
or other evidences of the grant of a security interest respecting the Collateral exist on the
public records other than with respect to Permitted Liens.

(c) Right to Grant Security Interest; No Further Encumbrances. The Grantors have the
right to grant a security interest in the Collateral. Except as permitted by the Credit Agreement,
the Grantors will pay all taxes and other charges against the Collateral (including, without
limitation, property, use and sales taxes). No Grantor will acquire, use or permit any Collateral
to be used illegally or in violation of Applicable Laws or allow the Collateral to be encumbered
except for Permitted Liens.

(d) Location of Collateral. The Grantors hereby represent and warrant to the
Administrative Agent and the Lenders that, as of the date hereof, the Collateral is situated only
at the collateral locations listed in Schedule I hereto (the “Collateral Locations”), and
the Grantors covenant with the Administrative Agent not to locate the Collateral at any location
other than a Collateral Location without at least 20 days prior written notice to the
Administrative Agent. The executive office of each Grantor set forth on Schedule I hereto (the
“Executive Office”) is, and for the one-year period preceding the Closing Date has been,
such Grantor’s chief executive office (if such Grantor has more than one place of business) or
place of business (if such Grantor has one place of business). In addition, to the extent the
Grantors should warehouse any of the Inventory Collateral, the Grantors acknowledge and agree that
such warehousing may be conducted only by warehousemen who shall: (1) issue non-negotiable
warehouse receipts in the Administrative Agent’s name to evidence any such warehousing of goods
constituting

 

 

 

Inventory Collateral; or (2) issue electronic warehouse receipts in the Administrative Agent’s name to
evidence any such warehousing of goods constituting Inventory Collateral in compliance with
applicable federal regulations and in all other respects satisfactory to the Administrative Agent
in its sole discretion. If the Grantors consign any of the Inventory Collateral, it will comply
with the U.C.C. of any state where such Inventory Collateral is located with respect thereto, and
shall file, cause the filing and hereby authorizes the Administrative Agent to file in the
appropriate public office or offices UCC-1 financing statements showing such Grantor or Grantors,
as the case may be, as consignor and the Administrative Agent as assignee of consignor, and will
furnish copies thereof to the Administrative Agent. If any of the Inventory Collateral or
Equipment Collateral or any records concerning the Collateral are at any time to be located on
premises leased by a Grantor or on premises owned by a Grantor subject to a mortgage or other lien,
such Grantor shall so notify the Administrative Agent and shall if reasonably requested by the
Administrative Agent obtain and deliver or cause to be delivered to the Administrative Agent, an
agreement, in form and substance satisfactory to the Administrative Agent, waiving the landlord’s
or mortgagee’s or lienholder’s right to enforce any claim against the Grantors for monies due under
the landlord’s lien, mortgage or other lien by levy or distraint or other similar proceedings
against the Inventory Collateral or Equipment Collateral or records concerning the Collateral and
assuring the Administrative Agent’s ability to have access to the Inventory Collateral or Equipment
Collateral and records concerning the Collateral in order to exercise its right hereunder to take
possession thereof.

(e) Collateral Status. The Grantors 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 or that would materially and adversely affect the ability of any
Grantor or the Administrative Agent to dispose of the Collateral or any material portion thereof,
or the rights and remedies of the Administrative Agent in relation thereto, including, without
limitation, the levy of any legal process against the Collateral or any material portion thereof.

(f) Delivery of Certain Collateral. Upon the reasonable request of the Administrative
Agent, the Grantors shall deliver to the Administrative Agent (or to the Collateral Custodian as
its agent and bailee), all agreements, letters of credit, promissory notes, instruments,
certificates of deposit, chattel paper or anything else, 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 therein. Without limiting the generality of the
foregoing, with respect to any Investment Related Property that is represented by a certificate or
that is an “instrument” (other than any Investment Related Property credited to a Securities
Account), each Grantor shall cause such certificate or instrument to be delivered to the
Administrative Agent (or to the Collateral Custodian as its agent and bailee), indorsed in blank by
an “effective indorsement” (as defined in Section 8-107 of the U.C.C.), regardless of whether such
certificate constitutes a “certificated security” for purposes of the U.C.C.

(g) Records Respecting Collateral. The Grantors 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 Grantors with respect to the Collateral will be
accessible from the Executive Office (as it may be changed pursuant to Section 6(e)).

 

 

 

(h) Further Assurances. Each Grantor shall duly execute and/or deliver (or cause to
be duly executed and/or delivered) to the Administrative Agent (or to the Collateral Custodian as
its agent and bailee) any instrument, invoice, document, document of title, dock warrant, dock
receipt, warehouse receipt, bill of lading, order, 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. Each 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 other than Permitted Liens.

(i) Maintenance of Insurance. In addition to and cumulative with any other
requirements herein imposed on the Grantors with respect to insurance, the Grantors shall maintain,
or cause to be maintained, insurance as required under the Credit Agreement. The Grantors shall
deliver to the Administrative Agent at such 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 Grantors 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. If any Grantor shall default in its obligation hereunder to insure the
Collateral in a manner satisfactory to the Administrative Agent, then the Administrative Agent
shall have the right (but not the obligation), after reasonable notice to such Grantor, to procure
such insurance and to charge the costs of same to the Grantors, which costs shall be added to and
become a part of the unpaid principal amount of the Obligations and shall be secured by the
Collateral. Each Grantor hereby appoints (which appointment constitutes a power coupled with an
interest and is irrevocable as long as any of the Obligations remain outstanding) Administrative
Agent as its lawful attorney-in-fact, effective after the occurrence of an Event of Default and
during the continuation thereof, with full authority to make, adjust, settle claims under and/or
cancel such insurance and to endorse the applicable Grantor’s name on any instruments or drafts
issued by or upon any insurance companies.

(j) Fundamental Changes. The Grantors hereby agree that no Grantor shall move its
Executive Office, or change its name, identity, state of incorporation or organization, type of
organization or its structure to other than as existing on the date hereof, unless the Grantors
shall have (i) notified the Administrative Agent in writing at least 20 days prior thereto and
provided such other information as the Administrative Agent may reasonably request and (ii) taken
all actions necessary or reasonably requested by the Administrative Agent to maintain the
continuous validity, perfection and the same or better priority of the Administrative Agent’s
Liens.

(k) Name, Jurisdiction and Identification Number of Organization. The exact legal
name of each Grantor, the state of incorporation or organization and organizational identification
number for each Grantor is as set forth below:

	 	 	 	 	 	 	 	 	 
	Main Street Capital Corporation
	 	Maryland	 	 	D11798675	 
	Main Street Capital Partners, LLC
	 	Delaware	 	 	3575385	 
	Main Street Equity Interests, Inc.
	 	Delaware	 	 	4432981	 

 

 

 

Each Grantor was duly organized solely under the laws of such jurisdiction and, except as
provided on Schedule I, such Grantor has not changed its legal name, jurisdiction of organization
or its corporate structure in the five (5) years prior to the Closing Date.

(l) Control Agreements. Each Grantor will obtain and deliver or cause to be delivered
to the Administrative Agent, a control agreement in form and substance satisfactory to
Administrative Agent with respect to the Collateral with respect to: (i) Deposit Accounts;
(ii) Investment Related Property (for Securities Accounts, mutual funds and other uncertificated
securities); and (iii) Letter of Credit Rights; and/or Electronic chattel paper having,
individually, a value in excess of $500,000 or as otherwise requested by the Administrative Agent;
provided that, in each case, no such Collateral shall be included in calculating
the Borrowing Base unless the same is subject to a control agreement. Notwithstanding the
foregoing, the Borrower shall not be required to deliver a control agreement with respect to
account number 53032962 maintained with BB&T Capital Markets (the “Excluded Account”) unless
requested by the Administrative Agent, and the Borrower agrees that no cash, cash equivalents,
investment property, financial assets or other assets shall be maintained in, credited to or
recorded in the Excluded Account at any time while the Excluded Account is not subject to a control
agreement in favor of the Administrative Agent.

(m) Marking of Chattel Paper. If requested by the Administrative Agent, no Grantor
will create any Chattel Paper without placing a legend on the Chattel Paper reasonably acceptable
to the Administrative Agent indicating that the Administrative Agent has a security interest in the
Chattel Paper.

(n) 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.

(o) Assumed Debt. No Grantor has within the last five (5) years become bound (whether
as a result of merger or otherwise) as debtor under a security agreement entered into by another
Person, which has not been terminated prior to the date of this Agreement.

(p) No Authorizations. No authorization, approval or other action by, and no notice
to or filing with, any Governmental Authority or regulatory body is required for either (i) the
pledge or grant by any Grantor of the security interest purported to be created in favor of the
Administrative Agent hereunder or (ii) the exercise by the Administrative Agent of any rights or
remedies in respect of any Collateral (whether specifically granted or created hereunder or created
or provided for by applicable law), except as may be required, in connection with the disposition
of any Investment Related Property, by laws generally affecting the offering and sale of
Securities.

 

 

 

(q) Preservation. No Grantor shall take or permit any action which could materially
impair the Administrative Agent’s rights in the Collateral, subject to Grantors’ rights to dispose
of rights in the Collateral to the extent permitted hereunder or under the Credit
Agreement or the right to grant Permitted Liens. Each Grantor agrees that it will, at its own
cost and expense, take any and all actions necessary to warrant and defend the right, title and
interest of the Secured Parties in and to the Collateral against the claims and demands of all
other Persons (other than the holders of Permitted Liens).

(r) Pledged Debt. On each Representation Date, Schedule II hereto (as such schedule
may be amended or supplemented from time to time) sets forth under the heading “Pledged Debt” all
of the Pledged Debt owned by any Grantor and all of such Pledged Debt with a principal amount in
excess of $500,000 individually has been fully authorized, authenticated or issued, and delivered
and is the legal, valid and binding obligation of the issuers thereof and is not in default and
constitutes all of the issued and outstanding intercompany indebtedness evidenced by an instrument
or certificated security of the respective issuers thereof owing to such Grantor.

(s) Investment Accounts. Schedule II hereto (as such schedule may be amended or
supplemented from time to time) sets forth under the headings “Securities Accounts” and
“Commodities Accounts,” respectively, all of the Securities Accounts and Commodities Accounts in
which each Grantor has an interest (other than Securities Account no. 1582000060 in the name of
Main Street Capital Corporation and all subaccounts related thereto maintained with or held by
BB&T, by and through its Corporate Trust Services Department). Each Grantor is the sole
entitlement holder of each such Securities Account and Commodities Account, and such Grantor has
not consented to, and is not otherwise aware of, any Person (other than the Administrative Agent
pursuant hereto) having “control” (within the meaning of Sections 8-106 and 9-106 of the U.C.C.)
over, or any other interest in, any such Securities Account or Commodity Account or any securities
or other property credited thereto.

(t) Deposit Accounts. Schedule II hereto (as such schedule may be amended or
supplemented from time to time) sets forth under the heading “Deposit Accounts” all of the Deposit
Accounts in which each Grantor has an interest and each Grantor is the sole account holder of each
such Deposit Account and such Grantor has not consented to, and is not otherwise aware of, any
Person (other than the Administrative Agent pursuant hereto) having either sole dominion and
control (within the meaning of Section 9-104 of the U.C.C.) over, or any other interest in, any
such Deposit Account or any money or other property deposited therein.

(u) Commercial Tort Claims. Schedule III (as such schedule may be amended or
supplemented from time to time) sets forth all Commercial Tort Claims of each Grantor.

(v) Letter of Credit Rights. Schedule III (as such schedule may be amended or
supplemented from time to time) lists all letters of credit to which such Grantor has rights.

 

 

 

(w) After-Acquired Property. In the event any Grantor acquires rights in any
Investment Related Property (other than Pledged Entities (as defined in the Equity Pledge Agreement
between the Borrower and the Administrative Agent dated as of the date hereof), Commercial Tort
Claims or Letter of Credit Rights after the date of this Agreement, it shall deliver to the
Administrative Agent a completed Pledge Supplement, substantially in the form of Annex A attached
hereto, together with all Supplements to Schedules thereto, reflecting such new Investment Related
Property, Commercial Tort Claims, Letter of Credit Rights and all other
Investment Related Property, Commercial Tort Claims, Letter of Credit Rights;
provided, however, that the Grantors shall only be required to provide an updated
Pledge Supplement with respect to Pledged Debt acquired during any Fiscal Quarter on or before the
Reporting Date immediately following the end of such Fiscal Quarter. Notwithstanding the
foregoing, it is understood and agreed that the security interest of the Administrative Agent shall
attach to all Investment Related Property (other than Excluded Capital Securities), Commercial Tort
Claims and Letter of Credit Rights immediately upon any Grantor’s acquisition of rights therein and
shall not be affected by the failure of any Grantor to deliver a supplement to Schedule II or
Schedule III as required hereby.

7. 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; (b) the
failure to perform, observe or fulfill any covenant or obligation contained in this Agreement and
the continuation of such failure for more than thirty (30) days after the earlier of: (i) the
first day on which any Loan Party has knowledge of such failure; or (ii) written notice thereof has
been given to any Grantor by the Administrative Agent or (c) the occurrence of an Event of Default
(as defined in the Credit Agreement).

8. 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, each Grantor further agrees that (i) in the event that notice is necessary under
applicable law, written notice mailed to a Grantor at such Grantor’s address as provided herein,
ten (10) business days prior to the date of public 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; (iv) the Administrative Agent may require the Grantors to
assemble the Collateral, taking all necessary or appropriate action to preserve and keep it in good
condition, and make such available to the Administrative Agent at a place and time convenient to
both parties, all at the expense of the Grantors; (v) the Administrative Agent has no obligation to
repair, clean-up or otherwise prepare the Collateral for sale; and (vi) 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 Grantors 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 Grantors in any
respect. The Grantors hereby waive and release 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 Grantors 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 Grantors 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 Grantors. 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 Grantors. The
Grantors waive any right they 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 to adversely affect the commercial reasonableness of
any sale of the Collateral.

9. Continuing Security Interest. Any and all of the Administrative Agent’s rights
with respect to the security interests hereunder shall continue unimpaired, and the Grantors 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, draft, bill of
exchange or other instrument or Credit Document given in connection therewith, the Grantors 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
Grantors had expressly agreed thereto in advance.

10. 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
any 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 any Grantor in any respect.

 

 

 

11. Financing Statements. Each 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 such Grantor is an
organization, the type of organization and any organizational identification number issued to such
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. Each Grantor
agrees to provide such information to the Administrative Agent promptly upon request. Each 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, each 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.

12. Power of Attorney. Each Grantor hereby appoints any officer or agent of the
Administrative Agent as such Grantor’s true and lawful attorney-in-fact with power (i) effective at
any time an Event of Default has occurred and is continuing, to execute and file or record any
Assignments of Mortgage with respect to any Portfolio Investment, (ii) effective after the
occurrence and during the continuance of an Event of Default, to endorse the name of such Grantor
upon any notes, checks, drafts, money orders or other instruments of payment or Collateral which
may come into possession of the Administrative Agent; to sign and endorse the name of such Grantor
upon any invoices, freight or express bills, bills of lading, storage or warehouse receipts, drafts
against Account Debtors, assignments, verifications and notices in connection with Accounts; 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 Grantors 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 such 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.

13. 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.

 

 

 

14. 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 any Grantor, such 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.

15. 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. Each of the
Grantors hereby agrees that all of their liabilities and obligations under this Agreement shall be
joint and several. No reference to “proceeds” in this Agreement authorizes any sale, transfer, or
other disposition of the Collateral by any Grantor.

16. 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 Section 6.04 of the Credit Agreement.

17. Notices of Exclusive Control. The Administrative Agent agrees that it shall not
deliver a notice of exclusive control under any control agreement executed in connection with this
Agreement until a Default or an Event of Default has occurred and is continuing.

[Remainder of page intentionally left blank]

 

 

 

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

	 	 	 	 	 
	 	GRANTORS:

MAIN STREET CAPITAL CORPORATION

 	 
	 	By:  	
/s/ Todd A. Reppert 
 	 
	 	 	Name:  	Todd A. Reppert 	 
	 	 	Title:  	President and Chief Financial Officer 	 

	 	 	 	 	 
	 	MAIN STREET CAPITAL PARTNERS, LLC

 	 
	 	By:  	
/s/ Rodger Stout
 	 
	 	 	Name:  	Rodger Stout 	 
	 	 	Title:  	Chief Financial & Administrative Officer 	 

	 	 	 	 	 
	 	MAIN STREET EQUITY INTERESTS, INC.

 	 
	 	By:  	
/s/ Rodger Stout
 	 
	 	 	Name:  	Rodger Stout 	 
	 	 	Title:  	Vice PresidentFiled by Bowne Pure Compliance

	 	 	 	 	 

Exhibit 10.3

Execution version

 

MAIN STREET CAPITAL CORPORATION

as Borrower,

BRANCH BANKING AND TRUST COMPANY,

MORTGAGE CUSTODY DEPARTMENT OF CORPORATE TRUST SERVICES

as Custodian

and

BRANCH BANKING AND TRUST COMPANY

as Administrative Agent

 

CUSTODIAL AGREEMENT

 

Dated as of October 24, 2008

 

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	 	 	Page	 
	 
	 	 	 	 
	Section 1. Definitions
	 	 	1	 
	 
	 	 	 	 
	Section 2. Delivery of Investment Files
	 	 	2	 
	 
	 	 	 	 
	Section 3. Receipt of Investment Files
	 	 	3	 
	 
	 	 	 	 
	Section 4. Obligations of the Custodian
	 	 	3	 
	 
	 	 	 	 
	Section 5. Representations and Warranties of the Custodian
	 	 	5	 
	 
	 	 	 	 
	Section 6. Trust Receipts
	 	 	6	 
	 
	 	 	 	 
	Section 7. Future Defects
	 	 	7	 
	 
	 	 	 	 
	Section 8. Release
	 	 	7	 
	 
	 	 	 	 
	Section 9. Procedures Upon Default
	 	 	9	 
	 
	 	 	 	 
	Section 10. Fees and Expenses of Custodian
	 	 	10	 
	 
	 	 	 	 
	Section 11. Removal of Custodian
	 	 	10	 
	 
	 	 	 	 
	Section 12. Examination of Investment Files
	 	 	10	 
	 
	 	 	 	 
	Section 13. Insurance of Custodian
	 	 	11	 
	 
	 	 	 	 
	Section 14. Counterparts
	 	 	11	 
	 
	 	 	 	 
	Section 15. Governing Law/Submission to Jurisdiction
	 	 	11	 
	 
	 	 	 	 
	Section 16. Copies of Documents from Investment Files
	 	 	11	 
	 
	 	 	 	 
	Section 17. Resignation of Custodian
	 	 	12	 
	 
	 	 	 	 
	Section 18. Term of Agreement
	 	 	12	 
	 
	 	 	 	 
	Section 19. Notices
	 	 	12	 
	 
	 	 	 	 
	Section 20. Successors and Assigns
	 	 	13	 
	 
	 	 	 	 
	Section 21. Liability of the Custodian
	 	 	13	 
	 
	 	 	 	 
	Section 22. Indemnification
	 	 	13	 
	 
	 	 	 	 
	Section 23. Custodian’s Reliance
	 	 	14	 

 

- i -

 

	 	 	 	 	 
	 	 	Page	 
	 
	 	 	 	 
	Section 24. Merger or Consolidation of Custodian
	 	 	14	 
	 
	 	 	 	 
	Section 25. Transmission of Investment Files
	 	 	14	 
	 
	 	 	 	 
	Section 26. Authorized Representatives
	 	 	14	 
	 
	 	 	 	 
	Section 27. Reproduction of Documents
	 	 	15	 
	 
	 	 	 	 
	Section 28. Force Majeure
	 	 	15	 
	 
	 	 	 	 
	Section 29. Confidentiality Agreement
	 	 	15	 
	 
	 	 	 	 
	Section 30. No Amendments
	 	 	15	 
	 
	 	 	 	 
	Section 31. Express Duties
	 	 	16	 
	 
	 	 	 	 
	Section 32. Enforcement of Rights
	 	 	16	 
	 
	 	 	 	 
	Section 33. No Proceedings
	 	 	16	 
	 
	 	 	 	 
	Section 34. Custody Agreement
	 	 	16	 

	 	 	 
	Exhibit 1

	 	Intentionally Omitted
	 
	 	 
	Exhibit 2

	 	Trust Receipt
	 
	 	 
	Exhibit 3

	 	Request and Receipt for Release of Documents
	 
	 	 
	Exhibit 4

	 	Authorized Representatives of the Agent and Information for Notices
	 
	 	 
	Exhibit 5

	 	Authorized Representatives of the Borrower
	 
	 	 
	Exhibit 6

	 	Authorized Representatives of the Custodian
	 
	 	 
	Exhibit 7

	 	Form of List of Portfolio Investments
	 
	 	 
	Exhibit 8

	 	Form of Comfort Letter
	 
	 	 
	Exhibit 9

	 	Form of Bailee Letter
	 
	 	 
	Exhibit 10

	 	Form of Certification of Sale, Exchange, Transfer or Liquidation

 - ii - 

 

 

 

CUSTODIAL AGREEMENT

THIS CUSTODIAL AGREEMENT (this “Agreement”), dated as of October 24, 2008, by and
among Main Street Capital Corporation (the “Borrower”), Branch Banking and Trust Company,
Mortgage Custody Department of Corporate Trust Services, not individually, but solely in its
capacity as Custodian, having an address at 5130 Parkway Plaza Boulevard, Charlotte, North Carolina
28217 (the “Custodian”) and Branch Banking and Trust Company, acting in its capacity as
agent (the “Agent”) for itself and for the other Secured Parties (as defined in the Credit
Agreement described below).

PRELIMINARY STATEMENT

The Borrower and the Agent, among others, are parties to the Credit Agreement, dated as of
October 24, 2008 (as amended, supplemented, restated or otherwise modified and in effect from time
to time, the “Credit Agreement”), pursuant to which the Borrower has the benefit, subject
to the terms and conditions thereof, of advances from the Lenders (as defined in the Credit
Agreement) to finance, among other things, the making of Portfolio Investments (as defined below)
by the Borrower.

Pursuant to the Credit Agreement, the Borrower is required to take such action as shall be
necessary to maintain the perfection of the liens and security interests of the Agent, for the
benefit of the Secured Parties (as defined in the Credit Agreement) on the Collateral (as defined
in the Credit Agreement). The Borrower desires to have the Custodian take possession of the
related Investment File (as defined below) with respect to each Portfolio Investment, in accordance
with the terms and conditions hereof. The Borrower has agreed to deliver or cause to be delivered
to the Custodian the documents specified in Section 2 of this Agreement with respect to the
Portfolio Investments to be held pursuant to the terms of this Agreement.

The Custodian is a North Carolina banking corporation, and is otherwise authorized to act as
Custodian pursuant to this Agreement.

In consideration of the mutual undertakings herein, expressed, the parties hereto hereby agree
as follow:

Section 1. Definitions.

Unless otherwise defined herein, capitalized terms not otherwise defined herein are used as
defined in the Credit Agreement, and the following terms shall have the following meanings:

Agreement: shall mean this Agreement, as supplemented or amended from time to
time.

Authorized Person: shall have the meaning set forth in Section 26 of this
Agreement.

 

1

 

Business Day: means any day other than a Saturday or Sunday, or a day on which
banking and savings and loan institutions in North Carolina are authorized or obligated by
law of executive order to be closed, and a day on which the Custodian is open in the State
of North Carolina.

Comfort Letter: means a letter substantially in the form attached hereto as
Exhibit 8 furnished to the Custodian by the Borrower in connection with the closing
of the transactions creating a Portfolio Investment, a copy of which letter is delivered to
the Custodian with the related Investment File.

Credit Agreement: shall have the meaning set forth in the first paragraph of
the Preliminary Statement.

Investment File: means those documents listed in Section 2(a) of this
Agreement that are delivered to the Custodian pursuant to Section 2 hereof or that otherwise
come into the possession of the Custodian.

List of Portfolio Investments: means a listing, substantially in the form of
which is attached hereto as Exhibit 7, of all Portfolio Investments delivered to the
Custodian (which List of Portfolio Investments may be in the form of microfiche or computer
file or other medium acceptable to the Custodian).

Person: shall mean an individual, general partnership, limited partnership,
limited liability partnership, corporation, business trust, joint stock company, limited
liability company, trust, unincorporated association, joint venture, governmental authority,
or other entity of whatever nature.

Portfolio Investment: shall have the meaning set forth in the Credit
Agreement.

Trust Receipt: shall mean a trust receipt, substantially in the form set forth
on Exhibit 2 hereto, covering the Investment Files relating to the Portfolio
Investment described therein, which trust receipt is issued to the Agent.

UCC: shall mean the Uniform Commercial Code as in effect in the applicable
jurisdiction.

Section 2. Delivery of Investment Files.

(a) Within five (5) Business Days of the date that the Borrower makes a Portfolio
Investment, the Borrower shall deliver or cause the Borrower’s closing agent to deliver to
the Custodian, the following documents pertaining to such Portfolio Investment, along with a
Comfort Letter listing each document to be included in the Investment File for such
Portfolio Investment so delivered to the Custodian, each of which Portfolio Investment shall
be identified in a Schedule delivered in printed and electronic format therewith:

(i) any and all original executed promissory notes issued by the Obligor
pursuant to the applicable agreements evidencing such Portfolio Investment, together
with an indorsement executed in blank;

 

2

 

(ii) any and all original certificates representing equity interests pledged to
secure the obligations of the Obligor relating to such Portfolio Investment,
together with transfer powers for each such certificate, executed in blank; and

(iii) any and all original letters of credit, instruments, certificates of
deposit or chattel paper or other original documents, the physical possession of
which is necessary in order for the Agent, on behalf of the Secured Parties, to
perfect or preserve the priority of its security interest therein.

(b) From time to time, the Borrower shall forward to the Custodian additional documents
of the type described in the foregoing clause (a) evidencing any assumption, modification,
consolidation or extension of any Portfolio Investment, in accordance with the terms of the
Credit Agreement, and upon receipt of any such additional documents, the Custodian shall
hold such additional documents in accordance with the terms of this Agreement. Any
additional documents forwarded shall include a transmittal with instructions on filing and
the name of the Portfolio Investment to which it relates and any other information
reasonably requested by the Custodian.

Section 3. Receipt of Investment Files.

After receipt of each Investment File, the Custodian shall deliver a Trust Receipt to the
Agent in accordance with Section 6 hereof.

Section 4. Obligations of the Custodian.

The Custodian hereby confirms that (i) with respect to Investment Files delivered to it on the
date hereof, it has reviewed the List of Portfolio Investments therewith, and with respect to any
subsequently delivered Investment Files, it will review the List of Portfolio Investments delivered
therewith, (ii) with respect to Investment Files delivered to it on the date hereof, it holds such
Investment Files corresponding to each Portfolio Investment listed on the List of Portfolio
Investments to which it relates and, with respect to any subsequently delivered Investment Files,
it will hold such Investment Files corresponding to each Portfolio Investment listed on the List of
Portfolio Investments to which it relates and (iii) for each Portfolio Investment, each Investment
File contains each of the documents listed on Schedule A to the Comfort Letter relating to such
Portfolio Investment (excluding the items listed on the schedule of exceptions attached to the
related Trust Receipt) and if Schedule A to the Comfort Letter indicates that a document is an
original, the Custodian confirms that it has received such original document (except as indicated
on the schedule of exceptions attached to the related Trust Receipt). The Custodian shall create a
separate account in the name of the Borrower in which all assets, including the Portfolio
Investments and any Investment Files, shall be held, subject to the security interests of the Agent
pursuant to the Collateral Documents. The Custodian shall
dispose of or release such assets only upon the receipt of proper instruction from the
Authorized Persons of the Borrower or as otherwise specifically set forth in this Agreement.

 

3

 

The Custodian hereby acknowledges that, (A) to secure its obligations under the Credit
Agreement, the Borrower has granted a security interest to the Agent in its Portfolio Investments
and related assets with respect to the Obligations (as defined in the Credit Agreement) including,
without limitation, each document listed on the schedule to each Trust Receipt and (B) (i) it has
in its physical possession the related Investment File with respect to each Portfolio Investment
listed on the schedule to each Trust Receipt (excluding the items listed on the schedule of
exceptions attached to the related Trust Receipt, if any) (the “Property”), (ii) it will
hold the Property as bailee for and on behalf of the Agent for purposes of perfecting the interests
of the Agent therein, for the benefit of the Secured Parties (as defined in the Credit Agreement),
as provided in Section 9-313 of the UCC, and (iii) it is not holding the Property on behalf
of the Borrower or any other person or entity (including itself). The Custodian agrees that it
will continue to hold the Property in its possession and not transfer the Property without the
prior written consent of the Agent and, so long as no Default or Event of Default has occurred and
is continuing, the Borrower, except in accordance with this Agreement. Following indefeasible
payment in full of all amounts owing under the Loan Documents in respect of the Obligations, and
the cancellation or termination of the commitments under the Credit Agreement and any other
contingent obligations, the security interest of the Agent shall be released in accordance with the
terms of the Loan Documents and the Property shall revert to the Borrower.

The Custodian hereby agrees to hold all documents evidencing or representing ownership in or
the Borrower’s interest or investment in a Portfolio Investment which have been or are delivered to
the Custodian by the Borrower or by any other third party at the written direction of the Borrower,
including without limitation all promissory notes, certificates and other “instruments” within the
meaning of the UCC, as agent and bailee of the Agent, as secured party, and acknowledges that this
Agreement constitutes notice in accordance with the UCC and other applicable law of the Agent’s
security interest in such collateral and does hereby consent thereto. The Custodian shall hold all
documents received by it constituting the related Investment File with respect to each Portfolio
Investment as described in the preceding paragraph, and shall make disposition thereof only in
accordance with the terms of this Agreement. The Custodian shall segregate and maintain continuous
custody of all documents constituting each Investment File in a fire resistant vault in accordance
with customary standards for such custody, and such Investment Files shall be clearly marked with
appropriate notation in the Custodian’s computer files to indicate that the Investment Files are
held by the Custodian pursuant to this Agreement in a custodial capacity only. The Borrower and the
Agent shall have the opportunity to inspect the filing procedures, facilities, and the security
procedures. The Agent has made such inspection and has found them to comply with this Agreement.

The Custodian shall conduct, or cause to be conducted, periodic reviews of all items held by
it under this Agreement in such a manner as shall enable the Agent or the Borrower to verify the
accuracy of the Custodian’s record keeping.

The Custodian agrees and covenants that it will separately identify the related Investment
Files with respect to each Portfolio Investment delivered to the Custodian pursuant to this
Agreement from any and all other files, documents or agreements at any time or from time to
time delivered to the Custodian by or on behalf the Borrower or any of its affiliates.

 

4

 

In the event that (i) the Agent, the Borrower or the Custodian shall be served by a third
party with any type of levy, attachment, writ or court order with respect to any Investment File or
any document included within an Investment File or (ii) a third party shall institute any court
proceeding by which any Investment File or a document included within an Investment File shall be
required to be delivered otherwise than in accordance with the provisions of this Agreement, the
party receiving such service shall promptly deliver or cause to be delivered to the other parties
to this Agreement copies of all court papers, orders, documents and other materials concerning such
proceedings. The Custodian shall, to the extent permitted by law and any court order, continue to
hold and maintain all Investment Files that are the subject of such proceedings pending an order of
a court of competent jurisdiction permitting or directing disposition thereof. Upon final
determination of such court, and if permitted by such determination, the Custodian shall release
such Investment File or any document included within such Investment File as directed in writing by
the Borrower (with notice to the Agent), or, if a Default or Event of Default has occurred and is
continuing, the Agent, which shall give a direction consistent with such court determination. The
Custodian shall have no obligation to monitor or appear in any such proceeding on behalf of or in
the name of the Borrower or the Agent. Expenses and fees (including without limitation, attorney’s
fees) of the Custodian incurred as a result of such proceedings shall be borne by the Borrower.

Section 5. Representations and Warranties of the Custodian.

The Custodian represents and warrants to the Administrative Agent that:

(a) The Custodian (i) is duly organized, validly existing and in good standing under
the laws of North Carolina, (ii) has full corporate power and authority to conduct its
business and affairs as a custodian and (iii) is a bank having the qualifications prescribed
in Section 26(a) of the Investment Company Act of 1940, as amended (the “1940 Act”) for the
trustees of unit investment trusts.

(b) The Custodian hereby represents and warrants that it does not control, is not
controlled by, nor is under common control with (either directly or indirectly) the Borrower
or any of its affiliates.

(c) This Agreement, when executed and delivered by the Custodian, shall constitute the
valid, legal and binding obligation of the Custodian, enforceable against the Custodian in
accordance with its terms, except as the enforcement thereof may be limited by applicable
receivership or similar debtor relief laws and that certain equitable remedies may not be
available regardless of whether enforcement is sought in equity or at law.

(d) The Custodian is not in material breach of any material agreement to which it is a
party.

 

5

 

(e) By execution of this Agreement, the Custodian represents, warrants and covenants
that it does not currently hold, and during the existence of this Agreement shall
not hold, any adverse interest, by way of security or otherwise, in any Portfolio
Investment, and hereby waives any lien which the Custodian might have pursuant to statute or
otherwise available at law or in equity on the Portfolio Investments and the documents
constituting the related Investment File with respect to each Portfolio Investment held by
the Custodian hereunder, including all monies and proceeds derived therefrom or relating
thereto.

(f) The Custodian shall not, except with respect to the Custodian’s right to receive
its reasonable and customary fees and expenses hereunder, at any time exercise or seek to
enforce any claim, right or remedy, including any statutory or common law rights of set-off,
if any, that the Custodian may otherwise have against all or any part of an Investment File,
a Portfolio Investment, or any proceeds of the foregoing or against the Borrower or the
Agent.

(g) The
Custodian maintains insurance as required by Section 13 hereof.

The representations and warranties of the Custodian set forth above shall survive the
execution, delivery and termination of this Agreement shall inure to the benefit of the Agent and
the Borrower so long as this Agreement is in effect.

Section 6. Trust Receipts.

Within two Business Days after the receipt of the Investment Files pursuant to Section 2
hereof or such other time period mutually agreed to by the Borrower, the Agent and the Custodian,
the Custodian shall ascertain that (i) all documents required to be delivered to it are in its
possession, and (ii) that each note, certificate or other original collateral document, if any,
listed in Schedule A to each Comfort Letter is an original, executed counterpart of such document,
except as set forth on the exception schedule and (iii) shall deliver to the Agent a Trust Receipt
substantially in the form of Exhibit 2 attached hereto.

Each Trust Receipt issued hereunder shall be numbered sequentially, and the Custodian shall
maintain a record of such numbers and the name of the party to which such Trust Receipt was issued.

The Custodian makes no representation as to: (i) the validity, legality, sufficiency,
enforceability or genuineness of any of the documents contained in each Investment File or (ii) the
collectability, insurability, effectiveness or suitability of any Portfolio Investment. The
Custodian shall have no obligation to verify the receipt of any documents, the existence of which
was not delivered or not made known to the Custodian as part of the Investment File, and the
Custodian shall have no obligation to determine whether the recordation of any document is
necessary, nor shall the Custodian be responsible for the value, form, substance, validity,
perfection, priority, effectiveness or enforceability of any of such documents.

The Custodian shall provide the Agent and the Borrower with an exception report which shall be
attached to such Trust Receipt and shall specifically identify any missing endorsements or
documents required to be delivered to the Custodian pursuant to Section 2 and the party or parties
whose signatures may be required for any such endorsement. The Custodian shall have no duty to
obtain any missing endorsement or document. The Custodian shall be under no duty
or obligation to inspect, review or examine any such documents, instruments, certificates or
other papers to determine that they are genuine, enforceable, executed by an authorized officer, or
appropriate for the represented purpose or that they are other than what they purport to be on
their face.

 

6

 

Section 7. Future Defects.

During the term of this Agreement, the Custodian shall immediately notify the Agent and the
Borrower of any defect with respect to an Investment File or any failure on its part to hold the
Investment Files as herein provided.

Section 8. Release.

(a) From time to time and as requested by the Agent, the Custodian is hereby authorized, upon
receipt from the Agent of a request and receipt for release of documents, in substantially the form
annexed hereto as Exhibit 3, reasonably believed by the Custodian to be signed by an
Authorized Person of the Agent whose name appears on Exhibit 4 hereof to release to the
Agent or its designee the related Investment File or the documents set forth in such request and
receipt of such Person. The Agent agrees with Borrower that it will not make any request for
release unless a Default or Event of Default has occurred and is continuing.

(b) From time to time so long as no Default or an Event of Default has occurred and is
continuing, in connection with a sale, transfer, exchange, liquidation, payment in full or
modification or extension of any Portfolio Investment in the ordinary course of business, and
subject to the other provisions set forth in this Section 8, the Custodian is also authorized, upon
receipt from the Borrower of a request and receipt for release of documents, in substantially the
form annexed hereto as Exhibit 3, reasonably believed by the Custodian to be signed by an
Authorized Person of the Borrower whose name appears on Exhibit 5 hereof, to release the
related Investment File or the related documents set forth in such request and receipt for release
to a party other than the Borrower or any of its Affiliates. The Borrower shall provide a copy of
any such request and receipt for release to the Agent simultaneously with the delivery thereof to
the Custodian. At any time when three (3) or more Investment Files are currently released pursuant
to any request by or on behalf of the Borrower, the Custodian shall, prior to giving effect to such
release, obtain the consent of the Agent prior to complying with such requested release (which
consent shall not be unreasonably withheld prior to the occurrence and continuance of any Default
or Event of Default). The Custodian shall promptly notify the Agent after it has released any
Investment File or any document therein. Any transmittal of documentation pursuant to a request
and receipt for release under this clause (b) shall be under the cover of a transmittal letter
substantially in the form of the Bailee Letter attached as Exhibit 9 hereto, duly completed
and executed by the Custodian. The Custodian shall retain the executed Bailee Letter in the stead
of the related Investment File and shall notify the Agent and the Borrower in the event that the
third party designated to receive such Investment File or such documents fails to execute and
deliver to the Custodian a countersignature to the Bailee Letter within three (3) Business Days of
delivery thereof.

 

7

 

(c) The Custodian shall release any requested Investment Files pursuant to the foregoing at
the direction of the Borrower or the Agent, as the case may be, on the same day, if
the request therefor is received by the Custodian prior to 2:00 p.m. Eastern time, or,
otherwise, on the next succeeding Business Day after receipt of a request of release therefor. The
Custodian shall maintain a list of the Investment Files or if less than the entire Investment File,
the documents released. Upon return of the documents or the Investment File, the Custodian shall
maintain a list of the Investment Files or the documents returned.

(d) The Borrower covenants and agrees that:

(i) in the case of any documents of a type described in clauses 2(a)(i) or 2(a)(iii),
it shall not make any request for the release thereof until the obligations of the Obligor
under the related Portfolio Investment have been repaid in full, except for (A) ultimate
sale or exchange, and in such case the Borrower further agrees that all cash proceeds
thereof shall be deposited in a deposit account that is the subject of a control agreement
that creates a valid and perfected first-priority security interest in and lien in favor of
the Administrative Agent for the benefit of the Secured Parties or (B) renewal, amendment or
registration of transfer; provided that any document received in replacement, substitution
or exchange thereof is delivered to the Custodian prior to release of the existing original;

(ii) it shall not, directly or indirectly, maintain physical possession or “control”
within the meaning of the UCC of any Investment Files or documents released pursuant to this
Section 8 or instruct any Person to release or deliver the Investment Files or any documents
to it or any of its Affiliates or any agent on its or their behalf (other than the Agent);

(iii) it shall instruct each third party to which an Investment File is delivered
pursuant to clause (b) to execute and deliver to the Custodian a countersignature to the
Bailee Letter delivered to such Person in connection therewith (which delivery may be by
facsimile) and, in the event that such Person fails to do so within three (3) Business Days
of receipt of any Investment File or documents, and the Portfolio Investment relating to
such Investment File or document has not yet been sold, exchanged, transferred, liquidated
or paid in full, it shall direct such Person, and shall use its best efforts to cause such
Person, to immediately return the Investment File and any documents to the Custodian;

(iv) it shall promptly instruct such third parties to whom any Investment File or
documents have been delivered to return to the Custodian any Investment File or other such
documents when the need therefor no longer exists, unless the Portfolio Investment shall be
sold, exchanged, transferred or liquidated, in which case, thereupon it shall, in
substantially the form annexed hereto as Exhibit 10, certify to the Custodian and
the Agent that such sale, transfer or liquidation has occurred;

(v) at any time an Investment File or documents therein are not held by the Custodian
or by a bailee that has executed and delivered a valid, binding and effective Bailee Letter
in favor of the Agent , the related Portfolio Investment shall not be eligible for inclusion
in the Borrowing Base unless otherwise agreed in writing by the Agent in its sole
discretion; and

 

8

 

(vi) it shall not make any request for release of any Investment File or documents
therein if, after giving effect to such release, a Default shall occur and be continuing.

The Agent shall have the right to instruct the Custodian not to release, and Custodian
in such instance agrees not to so release, an Investment File if, in its good faith
judgment, the Agent believes that the Borrower’s request does not or shall not comply with
the foregoing covenants.

(e) Any Person may provide an electronic transmission for release of documents in a form
agreed to in advance of the initial transmission by the Borrower, the Agent and the Custodian
containing information readable without intervention by the Custodian’s data processing operations
or computer hardware and software staff, and arranged in a record layout to be specified by the
Custodian (a “Paperless Release Request”). All parties agree to maintain and control
access to electronic signature information and assume liability for any unauthorized use thereof.
Such parties also agree to maintain accurate records of electronic transactions related to the
Investment Files. Each such Person hereby authorizes the Custodian to automatically append the
electronic signature of an Authorized Representative to the applicable request for release of
documents and agrees and acknowledges that by appending such Authorized Representative’s electronic
signature, the Custodian shall be entitled to rely thereon. For purposes of this Agreement, the
term “electronic signature” is defined as an “electronic identifier intended by the person using it
to have the same force and effect as the use of a manual signature.” Each Paperless Release
Request shall be confirmed in writing and delivered to all parties in accordance with Section 19.
All parties agree in advance to comply with all of the Custodian’s security and record layout
standards in connection with any Paperless Release Request as may be amended from time to time upon
notice from the Custodian to such parties. The Custodian reserves the right to restrict or suspend
such parties’ access to the Custodian’s computer systems for maintenance or repairs or for any
other reason in the Custodian’s sole discretion, provided, however, that the
Custodian shall promptly provide such parties notice of such restriction or suspension.
Notwithstanding the foregoing, such parties are authorized to transmit, and the Custodian is
authorized to accept, signed facsimile copies of requests for release.

Section 9. Procedures Upon Default.

(a) The Agent shall notify the Custodian when a Default or an Event of Default has
occurred and is continuing. No knowledge of any Default or Event of Default will be implied
against the Custodian in the absence of such notice. The Custodian shall have no duty to
inquire whether a Default or an Event of Default has occurred and is continuing.

(b) Following notification by the Agent (which may be by facsimile) to the Custodian
that a Default or an Event of Default has occurred and is continuing, the Custodian shall
not release any item relating to any Portfolio Investment (including without limitation the
Investment Files) to the Borrower or any other Person without the express prior written
consent and at the direction of the Agent.

 

9

 

(c) Upon the written direction of the Agent from and after the occurrence of a Default
or an Event of Default, the Custodian shall submit for recording and/or filing any
assignments, instruments of transfer or other documents with respect to each Portfolio
Investments. The Borrower shall be responsible for all reasonable out-of-pocket costs and
expenses of the Custodian associated with the recording and/or filing of any such
assignments, instruments of transfer or other documents with respect to the Portfolio
Investments.

Section 10. Fees and Expenses of Custodian.

All reasonable fees of the Custodian for its services under this Agreement, and any reasonable
expenses incurred by the Custodian (including but not limited to reasonable counsel fees), will be
promptly paid and reimbursed by the Borrower, or its affiliate, pursuant to a fee agreement between
the Borrower, or its affiliate, and the Custodian.

Section 11. Removal of Custodian.

(a) The Agent or the Borrower, upon (i) at least thirty (30) days prior written notice
to the Custodian and the other party, may remove and discharge the Custodian (or any
successor custodian thereafter appointed), with cause, and (ii) at least sixty (60) days
prior written notice to the Custodian and the other party, may remove and discharge the
Custodian (or any successor custodian thereafter appointed), without cause, from the
performance of its obligations under this Custodial Agreement; provided, that, unless a
Default or an Event of Default has occurred and is continuing, neither the Agent nor the
Borrower shall remove or discharge the Custodian without cause without the consent of the
other party, which consent shall not be unreasonably withheld. Promptly after the giving of
notice of removal of the Custodian, the Agent shall appoint, by written instrument, a
successor custodian, which appointment shall, unless a Default or an Event of Default has
occurred and is continuing, require the consent of the Borrower, which consent shall not be
unreasonably withheld. One original counterpart of such instrument of appointment shall be
delivered to each of the Agent, the Borrower, the Custodian and the successor custodian.

(b) In the event of any such removal, the Custodian shall promptly transfer to the
successor custodian, as directed in writing, all the Investment Files being administered
under this Custodial Agreement. The cost of the shipment of Investment Files shall be at the
expense of the Custodian, in the event of a removal for cause, and otherwise at the expense
of the Borrower. The Borrower shall be responsible for the fees and expenses of the
successor custodian.

Section 12. Examination of Investment Files.

Upon reasonable prior written notice to the Custodian, the Borrower and the Agent and their
respective agents, designees, accountants, attorneys and auditors will be permitted during normal
business hours to examine the Investment Files. In addition, the Custodian shall permit access
during normal business hours to vendors, professionals and others employed by the Borrower for the
purpose of reviewing and repairing document deficiencies contained in the
Investment Files. All records relating to the Borrower’s assets shall remain the property of
the Borrower, and the Custodian shall maintain such records in accordance with the 1940 Act. Any
such examination shall be subject to the reasonable procedures of the Custodian. The Borrower
shall indemnify and hold the Custodian harmless from all claims, costs, expenses, losses and
damages incurred by the Custodian as a result of the loss or misplacement of any Investment Files
or documents or papers contained in the Investment Files while in the possession of the examining
party, except in the case of any loss or misplacement resulting from the gross negligence or
willful misconduct of the Agent or its respective agents, designees, accountants, attorneys or
auditors.

 

10

 

The Investment Files will initially be maintained at the Custodian’s office located at 5130
Parkway Plaza Boulevard, Charlotte, North Carolina 28217 and the Custodian will provide at least 30
days prior written notice to the Borrower and the Agent before such location is changed.

Section 13. Insurance of Custodian.

At its own expense, the Custodian shall maintain at all times during the existence of this
Agreement and keep in full force and effect fidelity insurance, theft of documents insurance, and
such insurance shall be in amounts with standard coverage and subject to deductibles as is
customary for insurance typically maintained by banks which act as custodian of assets similar to
the Portfolio Investments, and in no event in an annual amount less than $1,000,000.

Section 14. Counterparts.

For the purpose of facilitating the execution of this Agreement as herein provided and for
other purposes, this Agreement may be executed simultaneously in any number of counterparts each of
which counterparts shall be deemed to be an original, and such counterparts shall constitute and be
one and the same instrument.

Section 15. Governing Law/Submission to Jurisdiction.

This Agreement shall be deemed to have been made in and shall be construed in accordance with
the laws of the State of North Carolina and its validity, construction and effect shall be governed
by the internal laws of the State of North Carolina applicable to agreements wholly performed
therein. The appropriate state and federal courts located in the County of Mecklenburg or the
County of Forsyth in the State of North Carolina shall be an appropriate venue for any action, suit
or other proceeding arising from or based upon this Agreement. The parties hereto waive any
objection to the propriety or convenience of venue in such courts or to the jurisdiction of such
courts over any party and agree that any judgment entered therein may be enforced with no further
defense or offset in any jurisdiction in which the defendant is a citizen, resides or owns
property. Nothing in this Section 15 shall affect the right of the Agent to bring any action or
proceeding against any party hereto or its property in the courts of any other jurisdiction.

Section 16. Copies of Documents from Investment Files.

Upon the request of the Borrower or, with notice to the Borrower, the Agent and at the cost
and expense of the Borrower (including fees and expenses associated with researching and
making its copies), the Custodian shall provide the Borrower or the Agent with copies of the
documents in the related Investment File with respect to each Portfolio Investment.

 

11

 

Section 17. Resignation of Custodian.

The Custodian may resign upon at least 60 days prior written notice to the Borrower and the
Agent. Upon such resignation, the Agent may appoint a successor custodian in accordance with
Section 11 hereof, and the resigning Custodian shall immediately comply with the provisions of such
Section 11. If a successor is not appointed within forty-five (45) days, the Custodian may petition
a court of competent jurisdiction for a successor. Regardless of the reasons for the removal or
resignation of the Custodian, the obligations of a removed or resigning Custodian under this
Custodial Agreement and its status as custodian for and bailee of the Agent with respect to the
Collateral covered hereby shall continue until all of the Investment Files being administered under
this Custodial Agreement have been transferred to the successor custodian in accordance with
Section 11. The payment of such successor custodian’s fees shall be solely the responsibility of
the Borrower.

Section 18. Term of Agreement.

Promptly after written notice from the Agent of the termination of the Credit Agreement and
payment in full of all amounts owing to the Secured Parties and the Agent thereunder, the Custodian
shall deliver all documents remaining in the Investment Files to the Borrower in accordance with
the Borrower’s written instructions. The Borrower shall not be obligated to pay any fees or
expenses of the Custodian, except for shipping costs, attributable to periods following delivery of
the Borrower’s written delivery instructions to the Custodian.

Section 19. Notices.

All demands, notices and communications hereunder shall be in writing and shall be deemed to
have been duly given when received by the recipient party at the address shown on the first page
hereof or at such other address as may hereafter be furnished to the other party by like notice.
Any such demand, notice or communication hereunder shall be deemed to have been received on the
date actually delivered to or received at the premises of the addressee (as evidenced, in the case
of registered or certified mail, by the date noted on the return receipt).

If to Borrower:

Main Street Capital Corporation

1300 Post Oak Boulevard, Suite 800

Houston, Texas 77056

Attention: Rodger Stout

Telephone: (713) 350-6000

Facsimile: (713) 350-6042

If to the Agent:

At such address, phone number and facsimile number as set forth in Exhibit 4 hereto.

 

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If to the Custodian:

Branch Banking and Trust Company,

Mortgage Custody Department of Corporate Trust Services

5130 Parkway Plaza Boulevard

Charlotte, North Carolina 28217-1964

Attention: Susan Tittl

Telephone: (704) 954-1852

Telecopy: (704) 954-1830

Section 20. Successors and Assigns.

Except as provided herein, the Custodian may not assign its rights or delegate its obligations
under this Agreement without the express written consent of the Borrower and the Agent. Any
attempted assignment of rights or delegation of duties by the Custodian without such consent shall
be void. This Agreement shall inure to the benefit of the successors and assigns of the parties
hereto.

Section 21. Liability of the Custodian.

Neither the Custodian nor any of its directors, officers, agents or employees shall be liable
for any action taken or omitted to be taken by it or them hereunder or in connection herewith in
good faith and believed by it or them to be within the purview of this Agreement, including without
limitation in the selection of shippers and methods of shipment, except for its or their own gross
negligence or willful misconduct. In no event shall the Custodian or its directors, officers,
agents and employees be held liable for any special, indirect or consequential damages resulting
from any action taken or omitted to be taken by it or them hereunder or in connection herewith.
The Custodian shall not be responsible to any party for recitals, statements or warranties or
representations of the Borrower contained herein or in any document or be bound to ascertain or
inquire as to the performance or observance of any of the terms of this Agreement or any
participation and servicing agreement with respect to the Portfolio Investments on the part of the
Borrower, except as may otherwise be specifically set forth herein.

Section 22. Indemnification.

The Borrower agrees to defend, indemnify and hold the Custodian and its directors, agents and
employees harmless against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursement of any kind or nature whatsoever,
including reasonable attorney’s fees, that may be imposed on, incurred by, or asserted against it
or them in any way relating to or arising out of this Agreement or any action taken or not taken by
it or them hereunder unless such liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs or expenses are determined by a final judicial decree to result from the
gross negligence, lack of good faith or willful misconduct of the Custodian, its directors,
officers, agents or employees. The foregoing indemnification shall survive any termination of this
Agreement or the resignation or removal of the Custodian.

 

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Section 23. Custodian’s Reliance.

In the absence of bad faith on the part of the Custodian, the Custodian may conclusively rely,
as to the truth of the statements and the correctness of the opinions expressed therein, upon any
request, instructions, certificate, opinion or other document furnished to the Custodian, believed
by the Custodian to be genuine and to have been signed or presented by the proper party or parties
and conforming to the requirements of this Agreement; but in the case of any Investment File or
other request, instruction, document or certificate which by any provision hereof is specifically
required to be furnished to the Custodian, the Custodian shall be under a duty to examine the same
to determine whether or not it conforms to the requirements of this Agreement. The Custodian may
consult with outside counsel approved by the Borrower and any opinion shall be full and complete
authorization and protection in respect of any action taken or suffered or omitted by it hereunder
in good faith and in accordance with such opinion of counsel.

Section 24. Merger or Consolidation of Custodian.

Any Person into which the Custodian may be merged or converted or with which it may be
consolidated, or any Person resulting from any merger, conversion or consolidation to which the
Custodian shall be a party, or any Person succeeding to the business of the Custodian, shall be the
successor of the Custodian under this Agreement, without the execution of filing of any paper or
any further act on the part of the parties hereto, anything herein to the contrary notwithstanding.

Section 25. Transmission of Investment Files.

The Custodian shall use United Parcel Service, Federal Express or other nationally recognized
overnight courier service for the purpose of transmission of the Investment Files in the
performance of the Custodian’s duties hereunder. The Borrower will arrange for the provision of
such services at its sole cost and expense (or, at the Custodian’s option, reimburse the Custodian
for all costs and expenses incurred by the Custodian consistent with such instruction) and will
maintain such insurance against loss or damage to Investment Files as the Agent deems appropriate.
Without limiting the generality of the provisions of
Section 21 above, it is expressly agreed that
in no event shall the Custodian have any liability for any losses or damages to any person,
including without limitation, the Borrower, arising out of actions of the Custodian consistent with
instructions of the Borrower.

Section 26. Authorized Representatives.

Each representative of the Agent, the Borrower and the Custodian who is named on
Exhibit 4, Exhibit 5, or Exhibit 6 hereto, respectively (an “Authorized
Person”) is authorized to give and receive notices, requests and instructions, to deliver
certificates and documents in connection with this Agreement on behalf of the Agent, the Borrower
or the Custodian, respectively, and may, by delivering to the others a revised exhibit, change the
information previously given, but each of the other parties hereto shall be entitled to rely
conclusively on the last exhibit until receipt of a superseding exhibit.

 

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Section 27. Reproduction of Documents.

This Agreement and all documents relating thereto, including, without limitation, (a)
consents, waivers and modifications which may hereafter be executed, and (b) certificates and other
information previously or hereafter furnished, may be reproduced by any photographic, photostatic,
microfilm, microcard, miniature photographic or other similar process. The parties agree that any
such production shall be admissible in evidence as the original itself in any judicial or
administrative proceeding, whether or not the original is in existence and whether or not such
reproduction was made by a party in the regular course of business, and that any enlargement,
facsimile or further reproduction of such reproduction shall likewise be admissible in evidence.

Section 28. Force Majeure.

To the maximum extent permitted by law and notwithstanding any other provision of this
Agreement, the Custodian will not be liable for, and the Borrower hereby releases the Custodian
from responsibility for all losses, claims, liabilities, expenses (including counsel fees both
outside and internal allocated costs) and damages due to errors, delays or inaccuracies in
transmission and from all liability for losses arising out of interruption of business due to acts
of God, acts of governmental authority, acts of a public enemy, or due to any and all wars, riots,
fires, floods, civil commotion, insurrections, labor difficulties, severe weather conditions,
interruption, delay in, or loss (partial or complete) of electrical power or external computer
(hardware or software) or communications services, strikes or other labor disturbance by employees
or nonaffiliates, government, judicial or regulatory organization order, rule or regulation; energy
or natural resource difficulty or storage, and inability to obtain materials, equipment or
transportation and equipment, system and software failures or any other causes beyond the
reasonable control of the Custodian, preventing or delaying performance of any obligation under
this Agreement. This release shall survive termination of this Agreement.

Section 29. Confidentiality Agreement.

The Custodian acknowledges that the Investment Files may contain information which the
Borrower deems “confidential”, “proprietary” and “secret.” The Custodian shall hold and, shall at
all times ensure that its employees and agents hold in confidence all information contained in the
Investment Files, and will prevent (a) the disclosure by it or its agents or employees to others of
any such proprietary, confidential or secret information of the Portfolio Investments or (b) the
use of such information other than for purposes set forth herein, unless authorized to do so in
writing by the Borrower.

Section 30. No Amendments.

No amendments or modifications to this Agreement shall be effective unless agreed to in
witting by all the parties hereto.

 

15

 

Section 31. Express Duties.

It is expressly agreed by the parties hereto that the Custodian has no duties or obligations
regarding the Investment Files other than that specifically set forth in this Agreement and has no
obligation to sign any documents except for those specifically agreed to be executed by the
Custodian under this Agreement as custodian and the Custodian shall not be required to place its
funds at risk and may require written indemnification for any action requested to be taken that is
not specifically set forth in this Agreement. The Custodian may without incurring any liability to
any person delay performance hereunder to verify the authority of any Authorized Person or to
consult with its legal counsel.

Section 32. Enforcement of Rights.

The Custodian and the Borrower each acknowledge that the Agent shall have the right, subject
to the terms of the Loan Documents, to enforce the Borrower’s rights and remedies under this
Agreement, including, without limitation, the right at any time to enforce this Agreement and the
obligations of the Custodian hereunder, and the right at any time to give or withhold any and all
consents, requests, notices, directions, approvals, demands, extensions or waivers under or with
respect to this Agreement with respect to Investment Files; provided, however, that the Agent shall
not be obligated to perform any of the obligations of the Borrower under this Agreement. The
Custodian acknowledges that the rights of the Agent with respect to the rights and remedies in
connection with any indemnification or any breach of any representation, warranty or covenant made
by the Custodian under this Agreement shall be continuing and shall survive any termination of this
Agreement.

Section 33. No Proceedings.

The Custodian hereby agrees that it will not institute suit against the Borrower, or join any
other Person in instituting against the Borrower, any bankruptcy, reorganization, arrangement,
insolvency or liquidation proceedings, or any other proceedings under any federal or state
bankruptcy or similar law. The foregoing shall not limit the Custodian’s right to file any claim
in or otherwise take any action with respect to any insolvency proceeding that was instituted by
any Person other than the Custodian.

Section 34. Custody Agreement.

Each party hereto represents that this Agreement is a 1940 Act custody agreement and shall be
interpreted in accordance therewith; provided, however, that nothing in the foregoing shall be
deemed to adversely affect the perfection of the security interests of the Agent for the benefit of
the Secured Parties in the Collateral pursuant to the provisions of this Agreement.

 

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IN WITNESS WHEREOF, the Borrower, the Agent and the Custodian have caused their names to be
duly signed hereto by their respective officers’ thereunto duly authorized, all as of the first
above written.

	 	 	 	 	 
	 	
BORROWER:

MAIN STREET CAPITAL CORPORATION

 	 
	 	By:  	/s/
Todd A. Reppert 
 	 
	 	 	Name:  	Todd A. Reppert 	 
	 	 	Title:  	President and Chief Financial Officer 	 

	 	 	 	 	 
	 	
CUSTODIAN:

BRANCH BANKING AND TRUST COMPANY,

MORTGAGE CUSTODY DEPARTMENT OF 

CORPORATE TRUST SERVICES

 	 
	 	By:  	/s/
Susan E. Tittl 
 	 
	 	 	Name:  	Susan E. Tittl 	 
	 	 	Title:  	Vice President 	 

	 	 	 	 	 
	 	
AGENT:

BRANCH BANKING AND TRUST COMPANY,

as Agent

 	 
	 	By:  	
/s/ Gregory Drabik
 	 
	 	 	Name:  	Gregory Drabik 	 
	 	 	Title:  	Vice President 	 

 

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