As filed with the Securities and Exchange Commission on May 5, 2015
Registration No. 333-
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
Main Street Capital Corporation
(Exact name of registrant as specified in its charter)
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Maryland |
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41-2230745 |
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(State or other jurisdiction of |
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(I.R.S. Employer |
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incorporation or organization) |
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Identification No.) |
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1300 Post Oak Boulevard, 8th Floor |
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Houston, TX |
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77056 |
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(Address of principal executive offices) |
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(Zip code) |
Main Street Capital Corporation 2015 Equity and Incentive Plan
Main Street Capital Corporation 2015 Non-Employee Director Restricted Stock Plan
(Full title of the plan)
Vincent D. Foster
President and Chief Executive Officer
Main Street Capital Corporation
1300 Post Oak Boulevard, 8th Floor
Houston, TX 77056
(Name, address and telephone number, including area code, of agent for service)
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.
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Large accelerated filer x |
Accelerated filer o |
Non-accelerated filer
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Smaller reporting company o |
CALCULATION OF REGISTRATION FEE
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Amount to be |
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Proposed maximum offering |
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Proposed maximum aggregate |
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Title of securities to be registered |
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registered (1) |
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price per share (4) |
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offering price (4) |
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Amount of registration fee (5) |
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Common Stock, par value $0.01 per share |
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3,000,000 |
(2) |
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31.40 |
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94,200,000 |
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$ |
10,946.04 |
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Common Stock, par value $0.01 per share |
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300,000 |
(3) |
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31.40 |
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$ |
9,420,000 |
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$ |
1,094.60 |
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(1) Pursuant to Rule 416 under the Securities Act of 1933, as amended (the “Securities Act”), this registration statement also covers an indeterminate number of common stock as may be necessary to adjust the number of common stock being offered or issued pursuant to the anti-dilution provisions of the plans referenced above, as a result of stock splits, stock dividends or similar transactions.
(2) Represents common stock reserved for issuance under the Main Street Capital Corporation 2015 Equity and Incentive Plan.
(3) Represents common stock reserved for issuance under the Main Street Capital Corporation 2015 Non-Employee Director Restricted Stock Plan.
(4) Estimated solely for the purpose of determining the amount of the registration fee in accordance with Rule 457(c) and (h) under the Securities Act and based upon the average of the high and low sales prices of the shares of Common Stock of Main Street Capital Corporation as reported on the New York Stock Exchange on May 4, 2015.
(5) Pursuant to Rule 457(p) under the Securities Act of 1933, as amended, a portion of the registration fee is offset by: (i) registration fees of $310.79 previously paid with respect to 639,808 unissued shares of Common Stock that were registered pursuant to a Registration Statement on Form S-8 (No. 333-151799) filed by the registrant on June 20, 2008 (the “Prior Registration Statement”). The registrant has filed a post-effective amendment to the Prior Registration Statement to deregister all of the shares that were registered under the Prior Registration Statements that were not sold.
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2015 Equity and Incentive Plan |
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2015 Non-Employee Director Restricted Stock Plan |
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Form of Restricted Stock Agreement |
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Form of Restricted Stock Agreement |
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Opinion of Sutherland Asbill & Brennan LLP |
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Consent of Grant Thornton LLP |
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INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
The document(s) containing the information required in Part I of Form S-8 will be sent or given to participants as specified by Rule 428(b)(1) under the Securities Act. In accordance with Rule 428 and the requirements of Part I of Form S-8, such documents are not being filed with the Securities and Exchange Commission (the “Commission”) either as part of this registration statement or as prospectuses or prospectus supplements pursuant to Rule 424 under the Securities Act. Main Street Capital Corporation (“Main Street,” “us” or “we”) will maintain a file of such documents in accordance with the provisions of Rule 428. Upon request, Main Street will furnish to the Commission or its staff a copy or copies of all of the documents included in that file. These documents and the documents incorporated herein by reference pursuant to Item 3 of Part II of this registration statement, taken together, constitute a prospectus that meets the requirements of Section 10(a) of the Securities Act.
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The following documents that have been filed with the Commission by Main Street are incorporated herein by reference and made a part hereof:
· Main Street’s Annual Report on Form 10-K for the year ended December 31, 2014 (File No. 001-33723);
· Main Street’s Current Reports on Form 8-K filed with the Commission (File No. 001-33723) on March 13, 2015, April 23, 2015, April 30, 2015 and May 5, 2015 (only to the extent the information contained in each of these Forms 8-K has been filed and not furnished); and
· The description of Main Street’s common stock contained in the Form 8-A filed by Main Street with the Commission on October 13, 2010, including any amendments or reports filed for the purpose of updating such description.
Each document filed with the Commission by Main Street pursuant to Section 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), (excluding any information furnished pursuant to Item 2.02 or Item 7.01 on any current report on Form 8-K) subsequent to the date of this registration statement and prior to the filing of a post-effective amendment to this registration statement that indicates that all securities offered hereby have been sold, or that deregisters all securities then remaining unsold, shall be deemed to be incorporated by reference in this registration statement and to be a part hereof from the date of filing of such documents.
Any statement contained in this registration statement or in a document incorporated or deemed to be incorporated herein by reference shall be deemed to be modified or superseded for purposes of this registration statement to the extent that a statement contained herein or in any subsequently filed document, which also is, or is deemed to be, incorporated by reference herein, modifies or supersedes such statement. Any such statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this registration statement.
Item 4. Description of Securities.
Not applicable.
Item 5. Interests of Named Experts and Counsel.
Not applicable.
Item 6. Indemnification of Directors and Officers.
Maryland law permits a Maryland corporation to include in its articles of incorporation a provision limiting the liability of its directors and officers to the corporation and its stockholders for money damages except for liability resulting from (a) actual receipt of an improper benefit or profit in money, property or services or (b) active and deliberate dishonesty established by a final judgment as being material to the cause of action. Our articles of incorporation contain such a provision that eliminates directors’ and officers’ liability to the maximum extent permitted by Maryland law, subject to the requirements of the Investment Company Act of 1940, as amended (the “1940 Act”).
Our articles of incorporation require us, to the maximum extent permitted by Maryland law and subject to the requirements of the 1940 Act, to indemnify any present or former director or officer or any individual who, while a director or officer and at our request, serves or has served another corporation, real estate investment trust, partnership, joint venture, trust, employee benefit plan or other enterprise as a director, officer, partner or trustee, from and against any claim or liability to which such person may become subject or which such person may incur by reason of his or her service in any such capacity, except with respect to any matter as to which such person shall have been finally adjudicated in any proceeding not to have acted in good faith in the reasonable belief that his or her action was in our best interest or to be liable to us or our stockholders by reason of willful misfeasance, bad faith, gross negligence or reckless disregard of the duties involved in the conduct of such person’s office.
Our bylaws obligate us, to the maximum extent permitted by Maryland law and subject to the requirements of the 1940 Act, to indemnify any present or former director or officer or any individual who, while a director or officer and at our request, serves or has served another corporation, real estate investment trust, partnership, joint venture, trust, employee benefit plan or other enterprise as a director, officer, partner or trustee and who is made, or threatened to be made, a party to a proceeding by reason of his or her service in any such capacity from and against any claim or liability to which that person may become subject or which that person may incur by reason of his or her service in any such capacity, except with respect to any matter as to which such person shall have been finally adjudicated in any proceeding not to have acted in good faith in the reasonable belief that his or her action was in our best interest or to be liable to us or our stockholders by reason of willful misfeasance, bad faith, gross negligence or reckless disregard of the duties involved in the conduct of such person’s office. Our bylaws also require that, to the maximum extent permitted by Maryland law, without requiring a preliminary determination of the ultimate entitlement to indemnification, to pay or reimburse reasonable expenses incurred by any such indemnified person in advance of the final disposition of a proceeding.
Maryland law requires a corporation (unless its articles of incorporation provide otherwise, which our articles of incorporation do not) to indemnify a director or officer who has been successful in the defense of any proceeding to which he or she is made, or threatened to be made, a party by reason of his or her service in that capacity. Maryland law permits a corporation to indemnify its present and former directors and officers, among others, against judgments, penalties, fines, settlements and reasonable expenses actually incurred by them in connection with any proceeding to which they may be made, or threatened to be made, a party by reason of his or her service in those or other capacities unless it is established that (a) the act or omission of the director or officer was material to the matter giving rise to the proceeding and (1) was committed in bad faith or (2) was the result of active and deliberate dishonesty, (b) the director or officer actually received an improper personal benefit in money, property or services or (c) in the case of any criminal proceeding, the director or officer had reasonable cause to believe that the act or omission was unlawful. However, under Maryland law, a Maryland corporation may not indemnify for an adverse judgment in a suit by or in the right of the corporation or for a judgment of liability on the basis that a personal benefit was improperly received, unless in either case a court orders indemnification, and then only for expenses. In addition, Maryland law permits a corporation to advance reasonable expenses to a director or officer upon the corporation’s receipt of (a) a written affirmation by the director or officer of his or her good faith belief that he or she has met the standard of conduct necessary for indemnification by the corporation and (b) a written undertaking by him or her or on his or her behalf to repay the amount paid or reimbursed by the corporation if it is ultimately determined that the standard of conduct was not met.
In addition, we have entered into Indemnity Agreements with our directors and executive officers. The form of Indemnity Agreement entered into with each director and officer was previously filed with the Commission as
Exhibit (k)(13) to our Registration Statement on Form N-2 (Reg. No. 333-142879). The Indemnity Agreements generally provide that we will, to the extent specified in the agreements and to the fullest extent permitted by the 1940 Act and Maryland law as in effect on the day the agreement is executed, indemnify and advance expenses to each indemnitee that is, or is threatened to be made, a party to or a witness in any civil, criminal or administrative proceeding. We will indemnify the indemnitee against all expenses, judgments, fines, penalties and amounts paid in settlement actually and reasonably incurred in connection with any such proceeding unless it is established that (i) the act or omission of the indemnitee was material to the matter giving rise to the proceeding and (a) was committed in bad faith or (b) was the result of active and deliberate dishonesty, (ii) the indemnitee actually received an improper personal benefit, or (iii) in the case of a criminal proceeding, the indemnitee had reasonable cause to believe his conduct was unlawful. Additionally, for so long as the we are subject to the 1940 Act, no advancement of expenses will be made until (i) the indemnitee provides a security for his undertaking, (ii) we are insured against losses arising by reason of any lawful advances, or (iii) the majority of a quorum of our disinterested directors, or independent counsel in a written opinion, determine based on a review of readily available facts that there is reason to believe that the indemnitee ultimately will be found entitled to indemnification. The Indemnity Agreements also provide that if the indemnification rights provided for therein are unavailable for any reason, we will pay, in the first instance, the entire amount incurred by the indemnitee in connection with any covered proceeding and waive and relinquish any right of contribution we may have against the indemnitee. The rights provided by the Indemnity Agreements are in addition to any other rights to indemnification or advancement of expenses to which the indemnitee may be entitled under applicable law, our articles of incorporation, our bylaws, any agreement, a vote of stockholders or a resolution of directors, or otherwise. No amendment or repeal of the Indemnity Agreements will limit or restrict any right of the indemnitee in respect of any action taken or omitted by the indemnitee prior to such amendment or repeal. The Indemnity Agreements will terminate upon the later of (i) ten years after the date the indemnitee has ceased to serve as our director or officer, or (ii) one year after the final termination of any proceeding for which the indemnitee is granted rights of indemnification or advancement of expenses or which is brought by the indemnitee. The above description of the Indemnity Agreements is subject to, and is qualified in its entirety by reference to, all the provisions of the form of Indemnity Agreement, previously filed with the Commission as Exhibit (k)(13) to our Registration Statement on Form N-2 (Reg. No. 333-142879).
We have obtained primary and excess insurance policies insuring our directors and officers against certain liabilities they may incur in their capacity as directors and officers. Under such policies, the insurer, on our behalf, may also pay amounts for which we have granted indemnification to the directors or officers.
Reference is made to Item 9 for our undertakings with respect to indemnification for liabilities arising under the Securities Act.
Item 7. Exemption from Registration Claimed.
Not Applicable.
The following documents are filed as a part of this registration statement or incorporated by reference herein:
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Exhibit |
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No. |
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Description |
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4.1 |
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Articles of Amendment and Restatement of Main Street Capital Corporation (incorporated by reference to Exhibit (a) to Main Street Capital Corporation’s Pre-Effective Amendment No. 2 to the Registration Statement on Form N-2 filed on August 15, 2007 (Reg. No. 333-142879)). |
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4.2 |
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Amended and Restated Bylaws of Main Street Capital Corporation (incorporated by reference to Exhibit 3.1 to Main Street Capital Corporation’s Current Report on Form 8-K filed on March 6, 2013 (File No. 1-33723)). |
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4.3 |
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Form of Common Stock Certificate (incorporated by reference to Exhibit (d) to Main Street Capital Corporation’s Pre-Effective Amendment No. 2 to the Registration Statement on Form N-2 filed on August 15, 2007 (Reg. No. 333-142879)). |
* Filed herewith.
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement;
(iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement;
Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) of this section do not apply if the registration statement is on Form S-8 and the information required to be included in a post-effective amendment by those paragraphs is contained in reports filed with or furnished to the Commission by the registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the registration statement.
(2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.
(b) The registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the registrant’s annual report pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan’s annual report pursuant to Section
15(d) of the Securities Exchange Act of 1934) that is incorporated by reference in this registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the provisions described under Item 6 above, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act of 1933 and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act of 1933 and will be governed by the final adjudication of such issue.
Pursuant to the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-8 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Houston, State of Texas, on May 5, 2015.
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MAIN STREET CAPITAL CORPORATION |
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By: |
/s/ Vincent D. Foster |
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Vincent D. Foster |
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Chairman, President and Chief Executive Officer |
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below hereby constitutes and appoints Vincent D. Foster and Brent D. Smith, and each of them (with full power to each of them to act alone), his true and lawful attorneys-in-fact and agents, with full power of substitution and re-substitution, for him and on his behalf and in his name, place and stead, in any and all capacities, to sign, execute and file this registration statement under the Securities Act of 1933, as amended, and any or all amendments (including, without limitation, post-effective amendments) to this registration statement, with all exhibits and any and all documents required to be filed with respect thereto, with the Securities and Exchange Commission or any other regulatory authority, granting unto such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing appropriate or necessary to be done in order to effectuate the same, as fully to all intents and purposes as he himself might or could do in person, hereby ratifying and confirming all that such attorneys-in-fact and agents, or any of them, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities indicated on May 5, 2015.
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Signature |
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Title |
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/s/ Vincent D. Foster |
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Chairman, President and Chief Executive Officer |
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Vincent D. Foster |
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(principal executive officer) |
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/s/ Brent D. Smith |
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Chief Financial Officer and Treasurer |
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Brent D. Smith |
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(principal financial officer) |
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/s/ Shannon D. Martin |
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Vice President and Chief Accounting Officer |
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Shannon D. Martin |
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(principal accounting officer) |
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/s/ Michael Appling Jr. |
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Director |
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Michael Appling Jr. |
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/s/ Joseph E. Canon |
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Director |
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Joseph E. Canon |
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/s/ Arthur L. French |
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Director |
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Arthur L. French |
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/s/ J. Kevin Griffin |
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Director |
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J. Kevin Griffin |
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/s/ John E. Jackson |
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Director |
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John E. Jackson |
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Exhibit |
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No. |
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Description |
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4.1 |
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Articles of Amendment and Restatement of Main Street Capital Corporation (incorporated by reference to Exhibit (a) to Main Street Capital Corporation’s Pre-Effective Amendment No. 2 to the Registration Statement on Form N-2 filed on August 15, 2007 (Reg. No. 333-142879)). |
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4.2 |
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Amended and Restated Bylaws of Main Street Capital Corporation (incorporated by reference to Exhibit 3.1 to Main Street Capital Corporation’s Current Report on Form 8-K filed on March 6, 2013 (File No. 1-33723)). |
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4.3 |
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Form of Common Stock Certificate (incorporated by reference to Exhibit (d) to Main Street Capital Corporation’s Pre-Effective Amendment No. 2 to the Registration Statement on Form N-2 filed on August 15, 2007 (Reg. No. 333-142879)). |
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*4.4 |
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Main Street Capital Corporation 2015 Equity and Incentive Plan. |
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*4.5 |
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Main Street Capital Corporation 2015 Non-Employee Director Restricted Stock Plan. |
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*4.6 |
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Form of Restricted Stock Agreement — Main Street Capital Corporation 2015 Equity and Incentive Plan. |
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*4.7 |
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Form of Restricted Stock Agreement — Main Street Capital Corporation 2015 Non-Employee Director Restricted Stock Plan. |
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*5.1 |
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Opinion of Sutherland Asbill & Brennan LLP as to the validity of the securities being registered. |
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*23.1 |
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Consent of Grant Thornton LLP. |
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*23.2 |
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Consent of Sutherland Asbill & Brennan LLP (included in Exhibit 5.1). |
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*24.1 |
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Power of Attorney (set forth in the signature page contained in Part II of this registration statement). |
* Filed herewith.
Exhibit 4.4
MAIN STREET CAPITAL CORPORATION
2015 EQUITY AND INCENTIVE PLAN
1. PURPOSE.
(A) General Purpose . The Plan has been established to advance the interests of Main Street Capital Corporation (the “Company”) by providing for the grant of Awards to Participants.
(B) Available Awards . The purpose of the Plan is to provide a means by which eligible recipients of Awards may be motivated to achieve the Company’s goals and be given an opportunity to benefit from increases in the value of the Company’s Stock through the granting of Restricted Stock, Incentive Stock Options, Non-Statutory Stock Options, Dividend Equivalent Rights, Other Stock-Based Awards or Performance Awards.
(C) Eligible Participants . All Employees and all Employee Directors are eligible to be granted Awards by the Board under the Plan; provided that, no person shall be granted Awards of Restricted Stock unless such person is an Employee of the Company or an Employee of a subsidiary of the Company.
2. DEFINITIONS.
(A) “1940 Act” means the Investment Company Act of 1940, as amended, and the rules and regulations promulgated thereunder.
(B) “Affiliate” means any corporation or other entity that stands in a relationship to the Company that would result in the Company and such corporation or other entity being treated as one employer under Section 414(b) or Section 414(c) of the Code, except that in determining eligibility for the grant of an Option by reason of service for an Affiliate, Sections 414(b) and 414(c) of the Code shall be applied by substituting “at least 50%” for “at least 80%” under Section 1563(a)(1), (2) and (3) of the Code and Treas. Reg. § 1.414(c)-2. The Company may at any time by amendment provide that different ownership thresholds (consistent with Section 409A) apply. Notwithstanding the foregoing provisions of this definition, except as otherwise determined by the Board, a corporation or other entity shall be treated as an Affiliate only if its employees would be treated as employees of the Company for purposes of the rules promulgated under the Securities Act of 1933, as amended, with respect to the use of Form S-8.
(C) “Award” means an award of Restricted Stock, Incentive Stock Options, Non-Statutory Stock Options, Dividend Equivalent Rights, Other Stock-Based Awards or Performance Awards granted pursuant to the Plan.
(D) “Board” means the Board of Directors of the Company.
(E) “Code” means the Internal Revenue Code of 1986, as amended and in effect, or any successor statute as from time to time in effect. Any reference to a provision of the Code
shall be deemed to include a reference to any applicable guidance (as determined by the Board) with respect to such provision.
(F) “Commission” means the Securities and Exchange Commission.
(G) “Committee” means a committee of two or more members of the Board appointed by the Board in accordance with Section 3(C).
(H) “Company” means Main Street Capital Corporation, a Maryland corporation.
(I) “Continuous Service” means the Participant’s uninterrupted service with the Company or an Affiliate, whether as an Employee or Employee Director.
(J) “Change in Control” means an event set forth in any one of the following paragraphs:
(i) any “person” or group (as defined in Section 3(a)(9) of the Exchange Act, and as modified in Section 13(d) and 14(d) of the Exchange Act), together with their affiliates and associates (both as defined in Rule 12b-2 under the Exchange Act) other than (i) the Company or any of its subsidiaries, (ii) any employee benefit plan of the Company or any of its subsidiaries, or the trustee or other fiduciary holding securities under any such employee benefit plan, (iii) a company owned, directly or indirectly, by stockholders of the Company in substantially the same proportions as their ownership of the Company or (iv) an underwriter temporarily holding securities pursuant to an offering of such securities by the Company, becomes the “beneficial owner” (as defined in Rule 13d-3 of the Exchange Act), directly or indirectly, of more than 30% of combined voting power of the voting securities of the Company then outstanding; or
(ii) individuals who, as of the effective date of the Plan, constitute the Board (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board; provided, however, that for purposes of this definition of Change in Control, any individual becoming a director subsequent to the effective date of the Plan whose appointment or nomination for election to the Board was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of an election contest with respect to the election or removal of directors or other solicitation of proxies or consents by or on behalf of a person other than the Board; or
(iii) the consummation of any merger, reorganization, business combination or consolidation of the Company or one of its subsidiaries (a “Business Combination”) with or into any other entity, other than a merger, reorganization, business combination or consolidation a result of which (or immediately after which) the holders of the voting securities of the Company outstanding immediately prior thereto holding securities would represent
immediately after such merger, reorganization, business combination or consolidation more than a majority of the combined voting power of the voting securities of the Company or the surviving entity or the parent of such surviving entity; or
(iv) the consummation of a sale or disposition by the Company of all or substantially all of the Company’s assets, other than a sale or disposition if the holders of the voting securities of the Company outstanding immediately prior thereto hold securities immediately thereafter which represent more than a majority of the combined voting power of the voting securities of the acquirer, or parent of the acquirer, of such assets; or
(v) the stockholders of the Company approve a plan of complete liquidation or dissolution of the Company.
Notwithstanding the foregoing, a “Change in Control” shall not be deemed to have occurred by virtue of the consummation of any transaction or series of integrated transactions immediately following which the record holders of the Stock of the Company immediately prior to such transaction or series of transactions continue to have substantially the same proportionate ownership in an entity which owns all or substantially all of the assets of the Company immediately following such transaction or series of transactions.
(K) “Dividend Equivalent Rights” has the meaning set forth in Section 13.
(L) “Employee” means any person employed by the Company or an Affiliate.
(M) “Employee Director” means a member of the Board of Directors of the Company who is also an Employee of the Company.
(N) “Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.
(O) “Family Member” means any child, stepchild, grandchild, parent, stepparent, grandparent, spouse, former spouse, sibling, niece, nephew, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law, or sister-in-law, including adoptive relationships, any person sharing the Participant’s household (other than a tenant or employee), a trust in which these persons have more than 50% of the beneficial interest, a foundation in which these persons (or the Participant) control the management of assets, and any other entity in which these persons (or the Participant) own more than 50% of the voting interests.
(P) “Incentive Award” means a type of Performance Award granted to a Participant under Section 10(C) representing a conditional right to receive a cash payment based on business performance in a performance period of one or more fiscal years or portions thereof.
(Q) “Incentive Stock Option” means an Option intended to qualify as an incentive stock option within the meaning of Section 422 of the Code and the regulations promulgated thereunder.
(R) “Non-Employee Director Plan” means the 2015 Non-Employee Director Restricted Stock Plan, as from time to time amended and in effect.
(S) “Non-Statutory Stock Option” means an Option that is not an Incentive Stock Option.
(T) “Option” means an Incentive Stock Option or a Non-Statutory Stock Option granted pursuant to the Plan.
(U) “Other Stock-Based Award” means an Award described in Section 9 of this Plan that is not covered by Section 7 or 8.
(V) “Participant” means a person to whom an Award is granted pursuant to the Plan.
(W) “Performance Award” means an Award made pursuant to this Plan that is subject to the attainment of one or more performance goals.
(X) “Performance Goal” means a standard established by the Committee to determine in whole or in part whether a Qualified Performance Award shall be earned.
(Y) “Permitted Transferee” means a Family Member of a Participant to whom an Award has been transferred by gift.
(Z) “Plan” means this 2015 Equity and Incentive Plan, as from time to time amended and in effect (and together with the Non-Employee Director Plan, the 2008 Equity Incentive Plan and the 2008 Non-Employee Director Restricted Stock Plan, the “Plans” ).
(AA) “Plan Administrator” means the Board or the Committee responsible for administering the Plan pursuant to Section 3.
(BB) “Qualified Performance Award” means a Performance Award made to a Participant who is an Employee that is intended to qualify as qualified performance-based compensation under Section 162(m) of the Code, as described in Section 10(B) of the Plan.
(CC) “Restricted Stock” means an award of Stock for so long as the Stock remains subject to restrictions requiring that it be forfeited to the Company if specified conditions are not satisfied.
(DD) “Securities Act” means the Securities Act of 1933, as amended.
(EE) “Stock” means the common stock of the Company, par value $.01 per share.
3. ADMINISTRATION.
(A) Administration by Board . The Board shall administer the Plan unless and until it delegates administration to a Committee, as provided in Section 3(C).
(B) Powers of the Board . The Board shall have the power, subject to the express provisions of the Plan and applicable law:
To determine from time to time which of the persons eligible under the Plan shall be granted Awards; when and how each Award shall be granted and documented; what type or combination of types of Awards shall be granted; the provisions of each Award granted, including the time or times when a person shall be permitted to exercise an Award; and the number of shares of Stock with respect to which an Award shall be granted to each such person.
To construe and interpret the Plan and Awards granted under it, and to establish, amend and revoke rules and regulations for its administration. The Board, in the exercise of this power, may correct any defect, omission or inconsistency in the Plan or in any Award documentation, in such manner and to such extent as it shall deem necessary or expedient to make the Plan fully effective.
To amend the Plan or an Award as provided in Section 14.
To terminate or suspend the Plan as provided in Section 15.
Generally, to exercise such powers and to perform such acts as the Board deems necessary or expedient to promote the best interests of the Company and that are not in conflict with the provisions of the Plan.
(C) Delegation to Committee . The Board may delegate the administration of the Plan to a Committee or Committees composed of not less than two members of the Board, each of whom shall be (i) a “Non-Employee Director” for purposes of Section 16 of the Exchange Act and Rule 16b-3 thereunder, (ii) an “outside director” for purposes of Section 162(m) and the regulations promulgated under the Code, and each of whom shall be “independent” within the meaning of the listing standards of the New York Stock Exchange, and the term “Committee” shall apply to any persons to whom such authority has been delegated; provided that a “required majority,” as defined in Section 57(o) of the 1940 Act, must approve each issuance of Awards and Dividend Equivalent Rights in accordance with Section 61(a)(3)(A)(iv) of the 1940 Act. If administration is delegated to a Committee, the Committee shall have, in connection with the administration of the Plan, the powers theretofore possessed by the Board, including the power to delegate to a subcommittee any of the administrative powers the Committee is authorized to exercise (and references in this Plan to the Board, other than the Board reference at the end of this sentence and the Board references in the last sentence of this subsection (c), shall thereafter be to the Committee or subcommittee), subject, however, to such resolutions, not inconsistent with the provisions of the Plan, as may be adopted from time to time by the Board. The Board may abolish the Committee at any time and revest in the Board the administration of the Plan, unless such actions are prohibited by the condition of exemptive relief obtained from the Commission. The Board hereby initially delegates all of its administrative and other powers under the Plan to the Compensation Committee of the Board until such powers may be revoked or delegated otherwise by the Board.
(D) Effect of the Board’s Decision . Determinations, interpretations and constructions made by the Board in good faith shall not be subject to review by any person and shall be final, binding and conclusive on all persons.
4. AWARD AGREEMENTS.
All Awards granted under the Plan, other than Incentive Awards, will be evidenced by an agreement. The agreement documenting the Award shall contain such terms and conditions as the Board shall deem advisable. Agreements evidencing Awards made to different participants or at different times need not contain similar provisions. In the case of any discrepancy between the terms of the Plan and the terms of any Award agreement, the Plan provisions shall control.
5. SHARES SUBJECT TO THE PLAN; CERTAIN LIMITS.
(A) Share Reserve . The maximum aggregate number of shares of Stock that may be issued under the Plan pursuant to grants of Restricted Stock or Other Stock-Based Awards or the exercise of Options is three million (3,000,000) shares.
(B) Reversion of Shares to the Share Reserve . If any Award shall for any reason expire or otherwise terminate, in whole or in part, the shares of Stock not acquired under such Award shall revert to and again become available for issuance under the Plan. Any shares of Stock used for tax withholding shall not revert to or again become available for issuance under the Plan.
(C) Type of Shares . The shares of Stock subject to the Plan may be unissued shares or reacquired shares bought on the market or otherwise. No fractional shares of Stock will be delivered under the Plan.
(D) Limits on Individual Grants . The maximum number of shares of Stock for which any Employee or Employee Director may be granted Awards in any calendar year is five hundred thousand (500,000) shares.
(E) Limits on Grants of Restricted Stock . The combined maximum amount of Restricted Stock that may be issued under the Plans and any other compensation plan of the Company will be 10% of the outstanding shares of Stock on the effective date of the Plans plus 10% of the number of shares of Stock issued or delivered by the Company (other than pursuant to compensation plans) during the term of the Plans. No one person shall be granted Awards of Restricted Stock relating to more than 25% of the shares available for issuance under this Plan.
(F) No Grants in Contravention of 1940 Act . At all times during such periods as the Company qualifies as a “business development company,” no Award may be granted under the Plan if the grant of such Award would cause the Company to violate the 1940 Act, including, without limitation, Section 61(a)(3), and, if otherwise approved for grant, shall be void and of no effect.
(G) Limits on Number of Awards . The amount of voting securities that would result from the exercise of all of the Company’s outstanding warrants, options, and rights, together with any Restricted Stock issued pursuant to the Plans and any other compensation plan of the Company at the time of issuance shall not exceed 25% of the outstanding voting securities of the Company, provided, however, that if the amount of voting securities that would result from the exercise of all of the Company’s outstanding warrants, options, and rights issued to the Company’s directors, officers, and employees, together with any Restricted Stock issued
pursuant to this Plans and any other compensation plan of the Company would exceed 15% of the outstanding voting securities of the Company, then the total amount of voting securities that would result from the exercise of all outstanding warrants, options, and rights, together with any Restricted Stock issued pursuant to the Plans and any other compensation plan of the Company at the time of issuance shall not exceed 20% of the outstanding voting securities of the Company.
(H) Date of Award’s Grant . The date on which the “required majority,” as defined in Section 57(o) of the 1940 Act, approves the issuance of an Award will be deemed the date on which such Award is granted.
6. ELIGIBILITY.
All Employees and all Employee Directors are eligible to be granted Awards by the Board under the Plan; provided that, no person shall be granted Awards of Restricted Stock unless such person is an Employee of the Company or an Employee of a subsidiary of the Company. By accepting any Award granted hereunder, the Participant agrees to the terms of the Award and the Plan. Notwithstanding any provision of this Plan to the contrary, awards of an acquired company that are converted, replaced or adjusted in connection with the acquisition may contain terms and conditions that are inconsistent with the terms and conditions specified herein, as determined by the Board.
7. OPTION PROVISIONS.
Each Option shall be evidenced by a written agreement containing such terms and conditions as the Board shall deem appropriate. All Options shall be separately designated Incentive Stock Options or Non-Statutory Stock Options at the time of grant, and, if certificates are issued, a separate certificate or certificates shall be issued for shares of Stock purchased on exercise of each type of Option. The provisions of separate Options need not be identical, but, to the extent relevant, each Option shall include (through incorporation by reference or otherwise) the substance of each of the following provisions:
(A) Time and Manner of Exercise . Unless the Board expressly provides otherwise, an Option will not be deemed to have been exercised until the Board receives a notice of exercise (in a form acceptable to the Board) signed by the appropriate person and accompanied by any payment required under the Award. If the Option is exercised by any person other than the Participant, the Board may require satisfactory evidence that the person exercising the Option has the right to do so. No Option shall be exercisable after the expiration of ten (10) years from the date on which it was granted.
(B) Exercise Price of an Option . The exercise price for each Option shall not be less than the closing stock price on the New York Stock Exchange on the date of grant (or the price on such other national securities exchange on which the stock is traded if the stock is not traded on the New York Stock Exchange on date of grant). If the stock is not traded on any national securities exchange on the date of grant, the exercise price will not be less than the net asset value of a share of stock, as determined by the Board in good faith, on the date of grant. If the exercise price as so determined would be less than the “fair market value” of the Stock within the meaning of the regulations under Section 409A of the Code, then the Options shall not be
granted. In the case of an Option granted to a 10% Holder and intended to qualify as an Incentive Stock Option, the exercise price will not be less than 110% of the current market value determined as of the date of grant. A “10% Holder” is an individual owning stock possessing more than 10% of the total combined voting power of all classes of stock of the Company or its parent or subsidiary corporations. No such Stock Option, once granted, may be repriced other than in accordance with the 1940 Act and the applicable stockholder approval requirements of the New York Stock Exchange, and in a manner that would continue to exclude the option from being subject to Section 409A of the Code.
(C) Consideration . The purchase price for Stock acquired pursuant to an Option shall be paid in full at the time of exercise either (i) in cash, or, if so permitted by the Board and if permitted by the 1940 Act and otherwise legally permissible, (ii) through a broker-assisted exercise program acceptable to the Board, (iii) through a net-settlement, using shares of Stock received in the Option exercise or other shares of Stock owned by the Participant, (iv) by such other means of payment as may be acceptable to the Board, or (v) in any combination of the foregoing permitted forms of payment.
(D) Transferability of an Incentive Stock Option . An Incentive Stock Option shall not be transferable except by will or by the laws of descent and distribution and shall be exercisable during the lifetime of the Participant only by the Participant.
(E) Transferability of a Non-Statutory Stock Option . A Non-Statutory Stock Option shall not be transferable except by will or by the laws of descent and distribution, or, to the extent provided by the Board, by gift to a Permitted Transferee, and a Non-Statutory Stock Option that is nontransferable except at death shall be exercisable during the lifetime of the Participant only by the Participant.
(F) Limitation on Repurchase Rights . If an Option gives the Company the right to repurchase shares of Common Stock issued pursuant to the Plan upon termination of employment of such Participant, the terms of such repurchase right must comply with the 1940 Act.
(G) Exercisability . The Board may determine the time or times at which an Option will vest or become exercisable and the terms on which an Option requiring exercise will remain exercisable. Notwithstanding the foregoing, vesting shall take place at the rate of at least 20% per year over not more than five years from the date the award is granted, subject to reasonable conditions such as continued employment; provided, however , that options may be subject to such reasonable forfeiture conditions as the Board may choose to impose. With respect to Awards granted as Incentive Stock Options, to the extent that the aggregate fair market value of the shares of Stock with respect to which such Incentive Stock Options are exercisable for the first time by the Participant during any calendar year (under all plans of the Company and any Affiliate) exceeds one hundred thousand dollars ($100,000), such Options will be treated as Non-Statutory Stock Options. For purposes of this Section 7(G), Incentive Stock Options will be taken into account in the order in which they were granted.
(H) Termination of Continuous Service . Unless the Board expressly provides otherwise, immediately upon the cessation of a Participant’s Continuous Service that portion, if
any, of any Option held by the Participant or the Participant’s Permitted Transferee that is not then exercisable will terminate and the balance will remain exercisable for the lesser of (i) a period of three months or (ii) the period ending on the latest date on which such Option could have been exercised without regard to this Section 6(H), and will thereupon terminate subject to the following provisions (which shall apply unless the Board expressly provides otherwise):
· if a Participant’s Continuous Service ceases by reason of death, or if a Participant dies following the cessation of his or her Continuous Service but while any portion of any Option then held by the Participant or the Participant’s Permitted Transferee is still exercisable, the then exercisable portion, if any, of all Options held by the Participant or the Participant’s Permitted Transferee immediately prior to the Participant’s death will remain exercisable for the lesser of (A) the one year period ending with the first anniversary of the Participant’s death or (B) the period ending on the latest date on which such Option could have been exercised without regard to this Section 6(H)(i), and will thereupon terminate; and
· if the Board in its sole discretion determines that the cessation of a Participant’s Continuous Service resulted for reasons that cast such discredit on the Participant as to justify immediate termination of his or her Options, all Options then held by the Participant or the Participant’s Permitted Transferee will immediately terminate.
8. RESTRICTED STOCK PROVISIONS.
Each grant of Restricted Stock shall be evidenced by a written agreement containing such terms and conditions as the Board shall deem appropriate. The provisions of separate grants of Restricted Stock need not be identical, but, to the extent relevant, each grant shall include (through incorporation by reference or otherwise) the substance of each of the following provisions:
(A) Consideration . To the extent permitted by the 1940 Act, Awards of Restricted Stock may be made in exchange for past services or other lawful consideration.
(B) Transferability of Restricted Stock . Except as the Board otherwise expressly provides, Restricted Stock shall not be transferable other than by will or by the laws of descent and distribution.
(C) Vesting . The Board may determine the time or times at which shares of Restricted Stock will vest.
(D) Termination of Continuous Service . Unless the Board expressly provides otherwise, immediately upon the cessation of a Participant’s Continuous Service that portion, if any, of any Restricted Stock held by the Participant or the Participant’s Permitted Transferee that is not then vested will thereupon terminate and the unvested shares will be returned to the Company and will be available to be issued as Awards under this Plan. The Board may provide in any Award agreement, or may determine in any individual case, that restrictions or forfeiture conditions relating to Restricted Stock will be waived in whole or in part in the event of
terminations resulting from any cause, and the Board may in other cases waive in whole or in part the forfeiture of Restricted Stock.
9. OTHER STOCK-BASED AWARDS.
The Board shall have the authority to determine the Participants who shall receive an Other Stock-Based Award, which shall consist of any right that is (i) not an Award described in Sections 7 or 8 above and (ii) an Award of Shares or an Award denominated or payable in, valued in whole or in part by reference to, or otherwise based on or related to, Shares (including, without limitation, securities convertible into Shares), as deemed by the Board to be consistent with the purposes of the Plan. Subject to the terms of the Plan and any applicable Award agreement, the Board shall determine the terms and conditions of any such Other Stock-Based Award.
10. PERFORMANCE AWARD.
Without limiting the type or number of Awards that may be made under the other provisions of this Plan, an Award may be in the form of a Performance Award. The terms, conditions and limitations applicable to an Award that is a Performance Award shall be determined by the Plan Administrator; provided that in the case of a Performance Award that is intended to comply with Section 162(m) of the Code, the Plan Administrator shall be the Committee. The Plan Administrator shall set performance goals in its discretion which, depending on the extent to which they are met, will determine the value and/or amount of Performance Awards that will be paid out to the Employee and/or the portion that may be exercised.
(A) Non-qualified Performance Awards . Performance Awards granted to Employees that are not intended to qualify as qualified performance based compensation under Section 162(m) of the Code shall be based on achievement of such goals and be subject to such terms, conditions and restrictions as the Plan Administrator or its delegate shall determine.
(B) Qualified Performance Awards . Performance Awards granted to Employees under the Plan that are intended to qualify as qualified performance based compensation under Section 162(m) of the Code shall be granted, paid, vested or otherwise deliverable solely on account of the attainment of one or more pre-established, objective Performance Goals established by the Plan Administrator. Such a Performance Goal may be based on one or more business criteria that apply to the Employee, one or more business segments, units, or divisions of the Company, or the Company as a whole, and if so desired by the Plan Administrator, by comparison with a peer group of companies. A Performance Goal shall be one or more of the following:
· Net Unrealized Appreciation and Net Realized Gains;
· Net Investment Income or Net Realized Income per share (actual or targeted growth);
· Economic value added (“EVA”);
· Net Investment Income or Net Realized Income measures;
· Dividend and Dividends per share measures;
· Cash flow and liquidity measures;
· Return measures (including but not limited to return on capital employed, return on equity, return on investment and return on assets);
· Operating measures (including but not limited to productivity, efficiency, and scheduling measures);
· Expense targets (including but not limited to funding and development costs and general and administrative expenses); or
· Stock price measures (including but not limited to growth measures and total stockholder return).
Unless otherwise stated, such a Performance Goal need not be based upon an increase or positive result under a particular business criterion and could include, for example, maintaining the status quo or limiting economic losses (measured, in each case, by reference to specific business criteria). In interpreting Plan provisions applicable to Performance Goals and Qualified Performance Awards, it is the intent of the Plan to conform with the standards of Section 162(m) of the Code and Treasury Regulation §1.162-27(e)(2)(i), as to grants to those Employees whose compensation is, or is likely to be, subject to Section 162(m) of the Code, and the Plan Administrator in establishing such goals and interpreting the Plan shall be guided by such provisions. Prior to the payment of any compensation based on the achievement of Performance Goals, the Plan Administrator must certify in writing that applicable Performance Goals and any of the material terms thereof were, in fact, satisfied. The Plan Administrator may, in its discretion and consistent with the terms of the Performance Award, reduce the amount of a Performance Award paid upon achievement of the Performance Goals, but it may not exercise any discretion to increase such amount. Subject to the foregoing provisions, the terms, conditions and limitations applicable to any Qualified Performance Awards made pursuant to this Plan shall be determined by the Plan Administrator.
A Qualified Performance Award of any Participant shall be subject to the limits set forth in Section 5(D); provided, however, in the case of a Qualified Performance Award that is an Incentive Award, the maximum dollar amount that may be granted with respect to performance periods of a single year or less is $5,000,000 and the maximum dollar amount that may be granted with respect to performance periods of more than one year is $5,000,000 multiplied by the number of full years in the performance period.
11. MISCELLANEOUS.
(A) Acceleration . The Board shall have the power to accelerate the time at which an Award or any portion thereof vests or may first be exercised, regardless of the tax or other
consequences to the Participant or the Participant’s Permitted Transferee resulting from such acceleration.
(B) Stockholder Rights . No Participant or other person shall be deemed to be the holder of, or to have any of the rights of a holder with respect to, any shares of Stock subject to an Option unless and until such Award has been delivered to the Participant or other person upon exercise of the Award. Holders of Restricted Stock shall have all the rights of a holder upon issuance of the Restricted Stock Award including, without limitation, voting rights and the right to receive dividends.
(C) No Employment or Other Service Rights . Nothing in the Plan or any instrument executed or Award granted pursuant thereto shall confer upon any Participant any right to continue in the employment of, or to continue to serve as a director of, the Company or an Affiliate or shall affect the right of the Company or an Affiliate to terminate (i) the employment of the Participant (if the Participant is an Employee) with or without notice and with or without cause or (ii) the service of an Employee Director (if the Participant is an Employee Director) pursuant to the Bylaws of the Company or an Affiliate and any applicable provisions of the corporate law of the state in which the Company or the Affiliate is incorporated. Nothing in the Plan will be construed as giving any person any rights as a stockholder except as to shares of Stock actually issued under the Plan. The loss of existing or potential profit in Awards will not constitute an element of damages in the event of termination of service for any reason, even if the termination is in violation of an obligation of the Company or an Affiliate to the Participant.
(D) Legal Conditions on Delivery of Stock . The Company will not be obligated to deliver any shares of Stock pursuant to the Plan or to remove any restriction from shares of Stock previously delivered under the Plan until: (i) the Company is satisfied that all legal matters in connection with the issuance and delivery of such shares have been addressed and resolved; (ii) if the outstanding Stock is at the time of delivery listed on any stock exchange or national market system, the shares to be delivered have been listed or authorized to be listed on such exchange or system upon official notice of issuance; and (iii) all conditions of the Award have been satisfied or waived. If the sale of Stock has not been registered under the Securities Act, the Company may require, as a condition to the grant or the exercise of the Award, such representations or agreements as counsel for the Company may consider appropriate to avoid violation of the Securities Act. The Company may require that certificates evidencing Stock issued under the Plan bear an appropriate legend reflecting any restriction on transfer applicable to such Stock, and the Company may hold the certificates pending lapse of the applicable restrictions.
(E) Withholding Obligations . Each grant or exercise of an Award granted hereunder shall be subject to the Participant’s having made arrangements satisfactory to the Board for the full and timely satisfaction of all federal, state, local and other tax withholding requirements applicable to such grant, exercise or exchange. The Company or its designated third party administrator shall have the right to deduct applicable taxes from any Award payment and withhold, at the time of delivery or vesting of cash or shares of Stock under this Plan, an appropriate amount of cash or number of shares of Stock or a combination thereof for payment of taxes or other amounts required by law or to take such other action as may be necessary in the opinion of the Company to satisfy all obligations for withholding of such taxes. The Plan Administrator may also permit withholding to be satisfied by the transfer to the Company of
shares of Stock theretofore owned by the holder of the Award with respect to which withholding is required. If shares of Stock are used to satisfy tax withholding, such shares shall be valued based on the fair market value when the tax withholding is required to be made.
(F) Section 409A . Awards under the Plan are intended either to qualify for an exemption from Section 409A or to comply with the requirements thereof, and shall be construed accordingly.
12. ADJUSTMENTS UPON CHANGES IN STOCK.
(A) Capitalization Adjustments . In the event of a stock dividend, stock split or combination of shares (including a reverse stock split), recapitalization or other change in the Company’s capital structure, the Board will make appropriate adjustments to the maximum number of shares specified in Section 5(A) that may be delivered under the Plan, to the maximum per-participant share limit described in Section 5(D) and will also make appropriate adjustments to the number and kind of shares of stock or securities subject to Awards then outstanding or subsequently granted, any exercise prices relating to Awards and any other provision of Awards affected by such change. To the extent consistent with qualification of Incentive Stock Options under Section 422 of the Code, the performance-based compensation rules of Section 162(m), and continued exclusion from or compliance with Section 409A of the Code, where applicable, the Board may also make adjustments of the type described in the preceding sentence to take into account distributions to stockholders other than those provided for in such sentence, or any other event, if the Board determines that adjustments are appropriate to avoid distortion in the operation of the Plan and to preserve the value of Awards granted hereunder; provided, however , that the exercise price of Awards granted under the Plan will not be adjusted unless the Company receives an exemptive order from the Commission or written confirmation from the staff of the Commission that the Company may do so.
(B) Change in Control . Except as otherwise provided in an Award, in the event of a Change in Control in which there is an acquiring or surviving entity, the Board may provide for the assumption of some or all outstanding Awards, or for the grant of new awards in substitution therefor, by the acquirer or survivor or an affiliate of the acquirer or survivor, in each case on such terms and subject to such conditions as the Board determines. In the absence of such an assumption or if there is no substitution, except as otherwise provided in the Award, each stock-based Award will become fully vested or exercisable prior to the Change in Control on a basis that gives the holder of the Award a reasonable opportunity, as determined by the Board, to participate as a stockholder in the Change in Control following vesting or exercise, and the Award will terminate upon consummation of the Change in Control.
13. DIVIDEND EQUIVALENT RIGHTS.
The Board may provide for the payment of amounts in lieu of cash dividends or other cash distributions ( “Dividend Equivalent Rights” ) with respect to Stock subject to an Award; provided, however , that grants of Dividend Equivalent Rights must be approved by order of the Commission. The Board may impose such terms, restrictions and conditions on Dividend Equivalent Rights, including the date such rights will terminate, as it deems appropriate, and may terminate, amend or suspend such Dividend Equivalent Rights at any time without the consent of
the Participant or Participants to whom such Dividend Equivalent Rights have been granted, if any.
14. AMENDMENT OF THE PLAN AND AWARDS.
The Board may at any time or times amend the Plan or any outstanding Award for any purpose which may at the time be permitted by law, and may at any time terminate the Plan as to any future grants of Awards; provided , that except as otherwise expressly provided in the Plan the Board may not, without the Participant’s consent, alter the terms of an Award so as to affect substantially and adversely the Participant’s rights under the Award, unless the Board expressly reserved the right to do so at the time of the grant of the Award. Any amendments to the Plan shall be conditioned upon stockholder approval only to the extent, if any, such approval is required by law (including the Code and applicable stock exchange requirements), as determined by the Board.
15. TERMINATION OR SUSPENSION OF THE PLAN.
(A) Plan Term . The Board may suspend or terminate the Plan at any time. Unless sooner terminated, the Plan shall terminate on the day before the tenth (10th) anniversary of the date the Plan is approved by the stockholders of the Company. Notwithstanding the termination of the Plan, Awards granted prior to termination of the Plan shall continue to be effective and shall be governed by the Plan. No Awards may be granted under the Plan while the Plan is suspended or after it is terminated.
(B) No Impairment of Rights . Suspension or termination of the Plan shall not impair rights and obligations under any Awards granted while the Plan is in effect except with the written consent of the Participant.
16. EFFECTIVE DATE OF PLAN.
The Plan shall become effective upon approval by the stockholders of the Company, which approval shall be within twelve (12) months before or after the date the Plan is adopted by the Board.
17. 1940 ACT.
No provision of this Plan is intended to contravene any portion of the 1940 Act, and in the event of any conflict between the provisions of the Plan or any Award and the 1940 Act, the applicable Section of the 1940 Act shall control and all Awards under the Plan shall be so modified. All Participants holding such modified Awards shall be notified of the change to their Awards and such change shall be binding on such Participants.
18. INFORMATION RIGHTS OF PARTICIPANTS.
The Company shall provide to each Participant who acquires Stock pursuant to the Plan, not less frequently than annually, copies of annual financial statements (which need not be audited). The Company shall not be required to provide such statements to key employees whose duties in connection with the Company assure their access to equivalent information.
19. SEVERABILITY.
If any provision of this Plan or any Award is or becomes or is deemed to be invalid, illegal, or unenforceable in any jurisdiction or as to any Participant or Award, or would disqualify this Plan or any Award under any applicable law, such provision shall be construed or deemed amended to conform to the applicable laws, or if it cannot be construed or deemed amended without, in the determination of the Board, materially altering the intent of this Plan or the Award, such provision shall be stricken as to such jurisdiction, Participant or Award and the remainder of this Plan and any such Award shall remain in full force and effect.
20. OTHER COMPENSATION ARRANGEMENTS.
The existence of the Plan or the grant of any Award will not in any way affect the Company’s right to award a person bonuses or other compensation in addition to Awards under the Plan.
21. WAIVER OF JURY TRIAL.
By accepting an Award under the Plan, each Participant waives any right to a trial by jury in any action, proceeding or counterclaim concerning any rights under the Plan and any Award, or under any amendment, waiver, consent, instrument, document or other agreement delivered or which in the future may be delivered in connection therewith, and agrees that any such action, proceedings or counterclaim shall be tried before a court and not before a jury. By accepting an Award under the Plan, each Participant certifies that no officer, representative, or attorney of the Company has represented, expressly or otherwise, that the Company would not, in the event of any action, proceeding or counterclaim, seek to enforce the foregoing waivers.
22. LIMITATION ON LIABILITY.
Notwithstanding anything to the contrary in the Plan, neither the Company nor the Board, nor any person acting on behalf of the Company or the Board, shall be liable to any Participant or to the estate or beneficiary of any Participant by reason of any acceleration of income, or any additional tax, asserted by reason of the failure of an Award to satisfy the requirements of Section 422 or Section 409A or by reason of Section 4999 of the Code; provided , that nothing in this Section 22 shall limit the ability of the Board or the Company to provide by express agreement with a Participant for a gross-up payment or other payment in connection with any such tax or additional tax.
23. GOVERNING LAW.
The Plan and all Awards and actions hereunder shall be governed by the laws of the state of Texas, without regard to the choice of law principles of any jurisdiction.
Exhibit 4.5
MAIN STREET CAPITAL CORPORATION
2015 NON-EMPLOYEE DIRECTOR RESTRICTED STOCK PLAN
1. PURPOSE OF THE PLAN
The purpose of this Restricted Stock Plan (this “Plan” ) is to advance the interests of Main Street Capital Corporation (the “Company” ) by providing to members of the Company’s Board of Directors who are not employees of the Company ( “Non-Employee Directors” ) additional incentives, to the extent permitted by law, to exert their best efforts on behalf of the Company, and to provide a means to attract and retain persons of outstanding ability to the service of the Company. It is recognized that the Company’s efforts to attract or retain these individuals will be facilitated with this additional form of compensation.
2. ADMINISTRATION
This Plan shall be administered by the Compensation Committee (the “Committee” ) of the Company’s Board of Directors ( “Board” ), which is comprised solely of directors who are not interested persons of the Company within the meaning of Section 2(a)(19) of the Investment Company Act of 1940, as amended (the “Act” ). The Committee shall interpret this Plan and, to the extent and in the manner contemplated herein, shall exercise the discretion reserved to it hereunder. The Committee may prescribe, amend and rescind rules and procedures relating to this Plan and make all other determinations necessary for its administration. The decision of the Committee on any interpretation of this Plan or administration hereof, if in compliance with the provisions of the Act and regulations promulgated thereunder, shall be final and binding with respect to the Company and the Non-Employee Directors.
3. SHARES SUBJECT TO THE PLAN
The shares subject to this Plan shall be shares of the Company’s common stock, par value $0.01 per share ( “Shares” ). Subject to the provisions hereof concerning adjustment, the total number of shares that may be awarded as restricted shares under this Plan shall not exceed 300,000 Shares. Any Shares that were granted pursuant to an award of restricted stock under this Plan but that are forfeited pursuant to the terms of the Plan or an award agreement shall again be available under this Plan. Shares used for tax withholding shall not again be available under this Plan. Shares may be made available from authorized, un-issued or reacquired stock or partly from each.
4. AWARDS
(A) Non-Employee Directors. Non-Employee Directors will each receive a grant of shares of restricted stock at or about the beginning of each one-year term of service on the Board, for which forfeiture restrictions will lapse at the end of that term; provided that the Board may provide in any award agreement, or may determine in any individual case, that restrictions or forfeiture conditions relating to restricted stock will be waived in whole or in part in the event of terminations resulting from any cause, and the Board may in other cases waive in whole or in
part the forfeiture of restricted stock. The number of shares of restricted stock granted to each Non-Employee Director each year will be the equivalent of $30,000 worth of shares based on the market value at the close of the exchange on the date of grant.
(B) Award Agreements. All restricted stock granted under this Plan will be evidenced by an agreement. The agreement documenting the award of any restricted stock granted pursuant to this Plan shall contain such terms and conditions as the Committee shall deem advisable, including but not limited to the lapsing of forfeiture restrictions. Agreements evidencing awards made to different participants or at different times need not contain similar provisions. In the case of any discrepancy between the terms of this Plan and the terms of any award agreement, the Plan provisions shall control.
(C) Stockholder Rights. Holders of restricted stock shall have all the rights of a holder upon issuance of the restricted stock award including, without limitation, voting rights and the right to receive dividends.
5. LIMITATIONS ON RESTRICTED STOCK AWARDS
Grants of restricted stock awards shall be subject to the following limitations:
(A) The total number of shares that may be outstanding as restricted shares under all of the Company’s compensation plans shall not exceed ten (10) percent of the total number of Shares outstanding on the effective date of the Plan and the Company’s 2015 Equity and Incentive Plan (together, the “Plans” ) plus ten (10) percent of the number of shares of Stock issued or delivered by the Company (other than pursuant to compensation plans) during the term of the Plans.
(B) The amount of voting securities that would result from the exercise of all of the Company’s outstanding warrants, options, and rights, together with any restricted stock issued pursuant to this Plan and any other compensation plan of the Company, at the time of issuance shall not exceed twenty-five (25) percent of the outstanding voting securities of the Company, provided, however, that if the amount of voting securities that would result from the exercise of all of the Company’s outstanding warrants, options, and rights issued to the Company’s directors, officers, and employees, together with any restricted stock issued pursuant to this Plan and any other compensation plan of the Company, would exceed fifteen (15) percent of the outstanding voting securities of the Company, then the total amount of voting securities that would result from the exercise of all outstanding warrants, options, and rights, together with any restricted stock issued pursuant to this Plan and any other compensation plan of the Company, at the time of issuance shall not exceed twenty (20) percent of the outstanding voting securities of the Company.
6. TRANSFERABILITY OF RESTRICTED STOCK
While subject to forfeiture provisions, restricted stock shall not be transferable other than to the spouse or lineal descendants (including adopted children) of the participant, any trust for the benefit of the participant or the benefit of the spouse or lineal descendants (including adopted children) of the participant, or the guardian or conservator of the participant ( “Permitted Transferees” ).
7. EFFECT OF CHANGE IN STOCK SUBJECT TO THE PLAN
(A) Capitalization Adjustments . In the event of a stock dividend, stock split or combination of shares (including a reverse stock split), recapitalization or other change in the Company’s capital structure, the Board will make appropriate adjustments to the maximum number of shares that may be delivered under this Plan, to the maximum per-participant share limit, and will also make appropriate adjustments to the number and kind of shares of stock or securities subject to awards then outstanding or subsequently granted and any other provision of awards affected by such change. To the extent consistent with continued exclusion from or compliance with Section 409A of the Internal Revenue Code of 1986, as amended and in effect, or any successor statute as from time to time in effect, and other applicable law, the Board may also make adjustments of the type described in the preceding sentence to take into account distributions to stockholders other than those provided for in such sentence, or any other event, if the Board determines that adjustments are appropriate to avoid distortion in the operation of the Plan and to preserve the value of awards granted hereunder.
(B) Change in Control . Except as otherwise provided in an award, in the event of a Change in Control (as defined below) in which there is an acquiring or surviving entity, the Board may provide for the assumption of some or all outstanding awards, or for the grant of new awards in substitution therefor, by the acquirer or survivor or an affiliate of the acquirer or survivor, in each case on such terms and subject to such conditions as the Board determines. In the absence of such an assumption or if there is no substitution, except as otherwise provided in the award, each award will become fully vested or exercisable prior to the Change in Control on a basis that gives the holder of the award a reasonable opportunity, as determined by the Board, to participate as a stockholder in the Change in Control following vesting or exercise, and the award will terminate upon consummation of the Change in Control.
A “Change in Control” means an event set forth in any one of the following paragraphs:
(i) any “person” or group (as defined in Section 3(a)(9) of the Securities Exchange Act of 1934 (as amended, and including the rules and regulations promulgated thereunder, the “Exchange Act” ), and as modified in Section 13(d) and 14(d) of the Exchange Act), together with their affiliates and associates (both as defined in Rule 12b-2 under the Exchange Act) other than (i) the Company or any of its subsidiaries, (ii) any employee benefit plan of the Company or any of its subsidiaries, or the trustee or other fiduciary holding securities under any such employee benefit plan, (iii) a company owned, directly or indirectly, by stockholders of the Company in substantially the same proportions as their ownership of the Company or (iv) an underwriter temporarily holding securities pursuant to an offering of such securities by the Company, becomes the “beneficial owner” (as defined in Rule 13d-3 of the Exchange Act), directly or indirectly, of more than thirty (30) percent of combined voting power of the voting securities of the Company then outstanding; or
(ii) individuals who, as of the effective date of the Plan, constitute the Board (the “Incumbent Board” ) cease for any reason to constitute at least a majority of the Board; provided, however, that for purposes of this definition of Change in Control,
any individual becoming a director subsequent to the effective date of the Plan whose appointment or nomination for election to the Board was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of an election contest with respect to the election or removal of directors or other solicitation of proxies or consents by or on behalf of a person other than the Board; or
(iii) the consummation of any merger, reorganization, business combination or consolidation of the Company or one of its subsidiaries (a “Business Combination” ) with or into any other entity, other than a merger, reorganization, business combination or consolidation a result of which (or immediately after which) the holders of the voting securities of the Company outstanding immediately prior thereto holding securities would represent immediately after such merger, reorganization, business combination or consolidation more than a majority of the combined voting power of the voting securities of the Company or the surviving entity or the parent of such surviving entity; or
(iv) the consummation of a sale or disposition by the Company of all or substantially all of the Company’s assets, other than a sale or disposition if the holders of the voting securities of the Company outstanding immediately prior thereto hold securities immediately thereafter which represent more than a majority of the combined voting power of the voting securities of the acquirer, or parent of the acquirer, of such assets; or
(v) the stockholders of the Company approve a plan of complete liquidation or dissolution of the Company.
Notwithstanding the foregoing, a “Change in Control” shall not be deemed to have occurred by virtue of the consummation of any transaction or series of integrated transactions immediately following which the record holders of the stock of the Company immediately prior to such transaction or series of transactions continue to have substantially the same proportionate ownership in an entity which owns all or substantially all of the assets of the Company immediately following such transaction or series of transactions.
8. MISCELLANEOUS PROVISIONS
(A) The Committee is authorized to take appropriate steps to ensure that neither the grant of nor the lapsing of the forfeiture restrictions on awards under this Plan would have an effect contrary to the interests of the Company’s stockholders. This authority includes the authority to prevent or limit the granting of additional awards under this Plan.
(B) The granting of any award under the Plan shall not impose upon the Company any obligation to appoint or to continue to appoint as a director or employee any participant, and the right of the Company and its subsidiaries to terminate the employment of any employee, or
service of any director, shall not be diminished or affected by reason of the fact that an award has been made under the Plan to such participant.
(C) The Company may make such provisions as it deems appropriate to withhold any taxes the Company determines it is required to withhold with respect to any award.
(D) The Plan and all awards and actions taken hereunder shall be governed by the laws of the state of Texas, without regard to the choice of law principles of any jurisdiction.
9. AMENDMENT AND TERMINATION
(A) The Board may modify, revise or terminate this Plan at any time and from time to time, subject to applicable requirements in (a) the Company’s articles of incorporation or by-laws and (b) applicable law and orders. The Board shall seek stockholder approval of any action modifying a provision of the Plan where it is determined that such stockholder approval is appropriate under the provisions of (a) applicable law or orders, or (b) the Company’s articles of incorporation or by-laws.
(B) Unless sooner terminated, the Plan shall terminate on the day before the tenth (10th) anniversary of the date the Plan is approved by the stockholders of the Company. Notwithstanding the termination of the Plan, awards granted prior to termination of the Plan shall continue to be effective and shall be governed by the Plan.
10. EFFECTIVE DATE OF THE PLAN
The Plan shall become effective upon the approval of this Plan by the shareholders of the Company.
Exhibit 4.6
MAIN STREET CAPITAL CORPORATION
2015 EQUITY AND INCENTIVE PLAN
RESTRICTED STOCK AGREEMENT
This Restricted Stock Agreement (this “Agreement” ) between Main Street Capital Corporation (the “Company” ) and (the “Grantee” ), an employee of the Company or one of its subsidiaries, regarding an award ( “Award” ) of shares of Stock (as defined in the 2015 Equity and Incentive Plan (the “Plan” ), such Stock comprising this Award referred to herein as “Restricted Stock” ) awarded to the Grantee under the Plan on (the “Award Date” ), such number of shares subject to adjustment as provided in the Plan, and further subject to the following terms and conditions:
1. Relationship to Plan.
This Award is subject to all of the terms, conditions and provisions of the Plan and administrative interpretations thereunder or amendments, if any, which are adopted by the Committee. Except as defined herein, capitalized terms used herein shall have the same meanings ascribed to them under the Plan. For purposes of this Agreement:
(a) Termination for “Cause” means termination by the Company of the Grantee’s employment with the Company or one of its subsidiaries for the Grantee’s:
(i) willful failure to substantially perform the Grantee’s duties to the Company or any of its subsidiaries;
(ii) breach of the Grantee’s duty of loyalty to the Company or any of its subsidiaries;
(iii) commission of an act of dishonesty toward the Company or any of its subsidiaries, theft of corporate property of the Company or any of its subsidiaries, or usurpation of the corporate opportunities of the Company or any of its subsidiaries;
(iv) unethical business conduct including any violation of law connected with the Grantee’s employment at the Company or any of its subsidiaries; or
(v) conviction of any felony involving dishonest or immoral conduct.
For purposes of this Section 1(a), an act or failure to act by the Grantee shall be considered “willful” only if the Grantee’s conduct was not in good faith and the Grantee lacked a reasonable belief that the Grantee’s act or omission was in the best interests of the Company.
(b) “Disability” means, due to sickness or as a direct result of accidental injury, the Grantee is eligible for and receiving long-term disability benefits under a disability income replacement plan offered by the Company.
(c) “Employment” means employment with the Company or any of its Subsidiaries.
(d) “Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.
(e) Termination for “Good Reason” shall mean a termination by the Grantee of the Grantee’s employment with the Company for any of the following reasons:
(i) the Company’s failure to perform any of its material obligations under the terms of the Grantee’s employment arrangement or agreement;
(ii) unless otherwise agreed or waived, written notice of a proposed relocation by the Company of the Grantee’s principal place of employment to a site outside a fifty (50) mile radius of the current site of the Grantee’s principal place of employment; or
(iii) the failure by a successor in interest to the Company to expressly assume the Company’s obligations under the terms of the Grantee’s employment arrangement or agreement.
A termination by the Grantee for Good Reason may not occur unless the Grantee has given notice to the Company within 90 days of the Grantee’s knowledge of the initial existence of a condition described in clauses (i) through (iii) above, and the Company shall have a period of at least 30 days (the “Correction Period” ) during which it may remedy the condition. If the Company remedies the condition within the Correction Period, the Grantee may not terminate for that Good Reason event.
A termination for “Good Reason” may occur only within 30 days immediately following the expiration of the Correction Period.
(f) Termination “Without Cause” shall mean a termination by the Company of the Grantee’s employment for any reason other than death, Disability, or Cause.
2. Vesting Schedule.
(a) The restrictions on the shares of Restricted Stock subject to this Award shall lapse and such shares shall vest in equal installments on (each a “Vesting Date” ), provided that the Grantee has been in continuous Employment from the Award Date through the respective Vesting Date, provided, further that if an Award anniversary falls on a day that is not a business day, the Vesting Date shall be the next following business day. Notwithstanding the foregoing, pursuant to the terms of the Plan, the Board or its Committee may, in its sole discretion, accelerate the time at which the shares of Restricted Stock subject to this Award shall vest.
(b) All shares of Restricted Stock subject to this Award shall vest, irrespective of the limitations set forth in subparagraph (a) above, provided that the Grantee has been in continuous Employment since the Award Date, upon the occurrence of:
(i) a Change in Control;
(ii) the Grantee’s termination of employment by reason of death or Disability; or
(iii) the Grantee’s termination of employment by the Grantee for Good Reason or by the Company Without Cause.
3. Forfeiture of Award.
Except as specifically provided in Section 2 above, upon the Grantee’s termination of employment all unvested shares of Restricted Stock as of the termination date shall be forfeited.
4. Escrow of Shares.
During the period of time between the Award Date and the earlier of the date the Restricted Stock vests or is forfeited (the “Restriction Period” ), the Restricted Stock shall be registered in the name of the Grantee and held in escrow by the Company or in a book-entry account with the Company’s transfer agent, and the Grantee agrees, upon the Company’s written request, to provide a stock power endorsed by the Grantee in blank. Any certificate or book-entry account shall bear a legend or notation as provided by the Company, conspicuously referring to the terms, conditions and restrictions described in this Agreement. Upon termination of the Restriction Period, if the shares of Restricted Stock are held in certificated form, a certificate representing such shares without any legend referring to the terms, conditions and restrictions described in this Agreement shall be delivered to the Grantee, and if the shares of Restricted Stock are held in book-entry form, the Company shall instruct the transfer agent to remove any notation referring to the terms, conditions and restrictions described in this Agreement, in each case, as promptly as is reasonably practicable following such termination. Fractional shares will not be issued and shares issued will be rounded up to the nearest whole share.
5. Code Section 83(b) Election.
The Grantee shall be permitted to make an election under Code Section 83(b), to include an amount in income in respect of the Award of Restricted Stock in accordance with the requirements of Code Section 83(b). Grantee acknowledges that such election must be filed with the Internal Revenue Service within 30 days of the grant of the Award for which such election is made. Grantee is solely responsible for making such election.
6. Dividends and Voting Rights.
During the Restricted Period, the Grantee shall have the right to vote or execute proxies with respect to the shares of Restricted Stock subject to this Award and to receive any
cash or stock dividends paid or distributed with respect thereto, unless and until the Restricted Stock is forfeited. Cash or stock dividends paid or distributed with respect to outstanding Restricted Stock shall be fully vested and nonforfeitable upon receipt. Notwithstanding the foregoing, in the case of a stock split affected by the Company by means of a stock dividend or any stock dividends affected as part of a recapitalization of the Company or similar event, any stock dividends distributed with respect to the underlying Restricted Stock shall be subject to the same restrictions provided for herein with respect to such Restricted Stock, and the dividend shares so paid or distributed shall be deemed Restricted Stock subject to all terms and conditions herein, provided that the vesting schedule with respect thereto shall be equal installments over the remaining number of installments applicable to the Restricted Stock with respect to which such shares are paid or distributed.
7. Delivery of Shares.
The Company shall not be obligated to deliver any shares of Stock if counsel to the Company determines that such sale or delivery would violate any applicable law or any rule or regulation of any governmental authority or any rule or regulation of, or agreement of the Company with, any securities exchange or association upon which the Stock is listed or quoted. The Company shall in no event be obligated to take any affirmative action in order to cause the delivery of shares of Stock to comply with any such law, rule, regulation or agreement.
8. Assignment of Award.
Except as otherwise permitted by the Committee, the Grantee’s rights under the Plan and this Agreement are personal; no assignment or transfer of the Grantee’s rights under and interest in this Award may be made by the Grantee other than by will or by the laws of descent and distribution.
9. Restrictions on Stock.
In consideration of the Award being made hereunder, the Grantee agrees that the Company (or a representative of any underwriters, initial purchasers or placement agents the Company may designate) may, in connection with any offering of any securities of the Company require that the Grantee not sell or otherwise transfer or dispose of any shares of Stock or other securities of the Company during such period (not to exceed 180 days) following such offering or such other date as may be requested by the Company or such representative of the underwriters, initial purchasers or placement agents. For purposes of this restriction, the Grantee will be deemed to own shares of Stock which: (a) are owned directly or indirectly by the Grantee, including securities held for the Grantee’s benefit by nominees, custodians, brokers, or pledgees; (b) may be acquired by the Grantee under this Award at any time, or otherwise be acquired by the Grantee within 60 days of the offering or other date set by the Company or the representative of the underwriters; (c) are owned directly or indirectly, by or for the Grantee’s spouse and any of his children who reside at his principal residence and over which Grantee can exercise dispositive authority; or (d) are owned, directly or indirectly, by or for a corporation, partnership, estate, or trust of which the Grantee is a shareholder, partner, beneficiary, or trustee and over which Grantee can exercise dispositive authority, but in the event the Grantee is a shareholder, partner, or beneficiary, only to the extent of the Grantee’s proportionate interest
therein as a shareholder, partner, or beneficiary thereof. The Grantee further agrees that the Company may impose “stop transfer” instructions with respect to securities subject to the foregoing restrictions until the end of such period.
10. Withholding.
At the time of delivery or vesting of Restricted Stock, the amount of, if applicable, all federal, state and other governmental withholding tax requirements imposed upon the Company with respect to the delivery or vesting of such shares of Restricted Stock shall be remitted to the Company or provisions to pay such withholding requirements shall have been made to the satisfaction of the Committee. The Committee may make such provisions as it may deem appropriate for the withholding of any taxes which it determines is required in connection with this Award. The Committee may satisfy such withholding by retaining shares of Restricted Stock that have vested, or by permitting the Grantee to deliver cash or previously owned shares of Stock, in each case having a fair market value (as determined by the Committee in accordance with the Plan), equal to the amount required to be withheld or paid.
11. Restrictive Legend or Notation.
Certificates or book-entry account representing the Stock issued pursuant to the Award will bear all legends or notations required by law or determined by the Company or its counsel as necessary or advisable to effectuate the provisions of the Plan and this Award. The Company may place a “stop transfer” order against shares of the Stock issued pursuant to this Award until all restrictions and conditions set forth in the Plan or this Agreement and in the legends or notations referred to in this Section 11 have been complied with. The stock transfer records of the Company will reflect stock transfer instructions with respect to such shares.
12. Successors and Assigns.
This Agreement shall bind and inure to the benefit of and be enforceable by the Grantee, the Company and their respective permitted successors and assigns (including personal representatives, heirs and legatees), except that the Grantee may not assign any rights or obligations under this Agreement except to the extent and in the manner expressly permitted herein.
13. Tax Matters.
Grantee acknowledges that the tax consequences associated with the Award are complex and that the Company has urged Grantee to review with the Grantee’s own tax advisors the federal, state and local tax consequences of this Award. Grantee is relying solely on such advisors and not on the statements or representations of the Company or its agents. Grantee understands that Grantee (and not the Company) will be responsible for Grantee’s own tax liability that may arise as a result of the Award.
14. No Employment Guaranteed.
No provision of this Agreement shall confer any right upon the Grantee to continued Employment.
15. Governing Law.
This Agreement shall be governed by, construed, and enforced in accordance with the laws of the State of Texas without regard to any jurisdiction’s choice of law principles.
16. Amendment.
This Agreement cannot be modified, altered or amended except by an agreement, in writing, signed by both the Company and the Grantee.
17. Dispute Resolution.
The provisions of this Section 17 shall be the exclusive means of resolving disputes of between the Grantee and the Company arising from the Plan or this Agreement, other than a dispute under Section 19. The parties shall attempt in good faith to resolve any disputes arising out of or relating to the Plan or this Agreement by negotiation between individuals who have authority to settle the controversy. Within 30 days of written notification regarding a dispute, the parties shall meet at such times and places as may be required to attempt to resolve the dispute. If the dispute has not been resolved within 90 days of the written notification, either party may file suit and all parties agree that any suit, action or proceeding arising in connection with the Plan or this Agreement shall be brought in the United States District Court of the Southern District of Texas (or should such Court lack jurisdiction to hear such action, suit or proceeding, in a Texas state court in Harris County, Texas) and that the parties shall submit to the jurisdiction of such court. The parties to this Agreement irrevocably waive, to the fullest extent permitted by law, any objection a party may have to the laying of venue for any such suit, action or proceeding brought in such court. THE PARTIES ALSO WAIVE ANY RIGHT THEY HAVE OR MAY HAVE TO A JURY TRIAL OF ANY SUCH SUIT, ACTION OR PROCEEDING. If any one or more provisions of this Section 17 shall for any reason be held invalid or unenforceable, it is the specific intent of the parties that such provisions shall be modified to the minimum extent necessary to make it or its application valid and enforceable.
18. Section 409A of the Code.
Notwithstanding any provision of this Agreement to the contrary, this Agreement is intended to provide for a grant of a stock right that is exempt from Section 409A of the Code and related regulations and United States Department of the Treasury pronouncements ( “Section 409A” ) as property transferred subject to Section 83 of the Code, as defined in Treasury Regulation 1.409A-1(b)(4)(B). Any ambiguous provisions will be construed in a manner that is compliant with or exempt from the application of Section 409A.
19. Non-competition, Non-solicitation and Non-disclosure.
(a) In consideration for the grant of the Award, the Grantee agrees that, except as authorized by a senior executive officer of the Company, he or she will not during the Grantee’s employment with the Company or any of its subsidiaries or affiliates, and for one year thereafter, directly or indirectly, personally, or as an employee, officer, director, principal of or investor in, or consultant or independent contractor with, another entity, engage in business with, be employed by, or render any consultation or business
advice or other services with respect to, any business in the United States which competes with the Company Business; provided, however , that Grantee may invest in (i) up to (but not more than) one percent (1%) of any class of securities of any enterprise (but without otherwise participating in the management or activities of such enterprise) if such securities are listed on any national or regional securities exchange or have been registered under Section 12(g) of the Securities Exchange Act of 1934 or (ii) up to (but not more than) ten percent (10%) of any class of securities of any private fund (but without otherwise participating in the management or activities of such enterprise) . For purposes of this Agreement, the term “Company Business” means investing through equity capital or long-term debt in lower middle-market businesses, or investing through long-term debt in middle-market businesses.
(b) In consideration for the grant of the Award, the Grantee agrees that, except as authorized by a senior executive officer of the Company, he or she will not, during the Grantee’s employment with the Company or any of its subsidiaries or affiliates, and for one year thereafter, directly or indirectly for his or her own account or on behalf of or together with another person, entity or organization (i) call on or otherwise solicit any natural person who is employed by the Company or any of its subsidiaries or affiliates in any capacity with the purpose or intent of attracting that person from the employ of the Company or its subsidiaries or affiliates, (ii) employ, retain or otherwise engage (other than on the Company’s behalf) any natural person who is employed, or who was employed in the last year, by the Company or any of its subsidiaries or affiliates in any capacity, or (iii) divert or attempt to divert any potential investment opportunities away from the Company.
(c) As further consideration for the grant of the Award, the Grantee agrees that, except as authorized by a senior executive officer of the Company, he or she will not at any time, with while employed by the Company or its subsidiaries or affiliates, or any time thereafter, make any independent use of, or disclose to any person any confidential, non-public and/or proprietary information of the Company and its subsidiaries or affiliates, including, without limitation, information derived from models, processes, reports, ideas, investment opportunities, legal documents, or other information in any form prepared by or performed by or on behalf of the Company or any of its subsidiaries or affiliates.
This Section 19 shall survive the termination of this Agreement.
20. Award Repayment Obligation
The Grantee agrees that in the event the Company determines that the Grantee has (a) been terminated for Cause pursuant to Section 1(a) of this Agreement, (b) violated any of the restrictive covenants in Section 19 of this Agreement, or (c) engaged in intentional misconduct that caused or substantially caused the need for a restatement of the Company’s financial statements, the Company may, in its discretion and to the extent permitted by applicable law, cause the full or partial cancellation of any unvested shares of Restricted Stock outstanding under this Award and, with respect to shares of Restricted Stock that have vested since the date one year prior to the date that the Grantee is notified of such determination, require the Grantee to repay to the Company the full or partial fair market value of the Award at the time of vesting,
less any nonrefundable federal, state, or local taxes actually paid with respect to the Award. A Participant’s repayment obligations hereunder may, at the election of the Company, be satisfied by a cash payment, delivery of Stock or such combination of the foregoing as the Company in its discretion may determine. Repayments pursuant to this Section 20 shall be made within sixty (60) days after written demand for repayment is made by the Company. This Section 20 shall survive the termination of this Agreement.
[Signature page follows]
Exhibit 4.7
MAIN STREET CAPITAL CORPORATION
2015 NON-EMPLOYEE DIRECTOR RESTRICTED STOCK PLAN
RESTRICTED STOCK AGREEMENT
This Restricted Stock Agreement (this “Agreement” ) between Main Street Capital Corporation (the “Company” ) and (the “Grantee” ), a member of the Board of Directors of the Company (the “Board” ), regarding an award ( “Award” ) of shares of common stock, par value $0.01 per share (the “Common Stock” and, such Common Stock comprising this Award, the “Restricted Stock” ), awarded to the Grantee on (the “Award Date” ), pursuant to the 2015 Non-Employee Director Restricted Stock Incentive Plan (the “Plan” ), such number of shares of Restricted Stock subject to adjustment as provided in the Plan, and further subject to the following terms and conditions:
1. Relationship to Plan.
This Award is subject to all of the terms, conditions and provisions of the Plan and administrative interpretations thereunder or amendments, if any, which are adopted by the Committee. Except as defined herein, capitalized terms used herein shall have the same meanings ascribed to them under the Plan.
2. Vesting Schedule.
(a) All shares of Restricted Stock subject to this Award shall vest on the day immediately preceding the first annual meeting at which shareholders elect directors that occurs after the Award Date, provided that the Grantee has been in continuous service as a member of the Board through such date (the “Vesting Date” ), provided that if such date falls on a day that is not a business day, the Vesting Date shall be the next following business day. The Board may amend the Plan, in accordance with the terms of the Plan, to accelerate the time at which the shares of Restricted Stock subject to this Award shall vest.
(b) All shares of Restricted Stock subject to this Award shall vest, irrespective of the limitations set forth in subparagraph (a) above, upon the occurrence of a Change in Control.
3. Forfeiture of Award.
Except as specifically provided in Section 2 above, upon the Grantee’s termination of service as a member of the Board, all unvested shares of Restricted Stock as of the termination date shall be forfeited back to the Company without payment.
4. Escrow of Shares.
During the period of time between the Award Date and the earlier of the date the shares of Restricted Stock vest or are forfeited (the “Restriction Period” ), the shares of Restricted Stock shall be registered in the name of the Grantee and held in escrow by the Company or in a book-entry account with the Company’s transfer agent, and the Grantee agrees, upon the Company’s written request, to provide a stock power endorsed by the Grantee in blank.
Any certificate or book-entry account shall bear a legend or notation as provided by the Company, conspicuously referring to the terms, conditions and restrictions described in this Agreement. Upon termination of the Restriction Period, if the shares of Restricted Stock are held in certificated form, a certificate representing such shares without any legend referring to the terms, conditions and restrictions described in this Agreement shall be delivered to the Grantee, and if the shares of Restricted Stock are held in book-entry form, the Company shall instruct the transfer agent to remove any notation referring to the terms, conditions and restrictions described in this Agreement, in each case, as promptly as is reasonably practicable following such termination. Fractional shares will not be issued and shares issued will be rounded up to the nearest whole share.
5. Code Section 83(b) Election.
The Grantee shall be permitted to make an election under Code Section 83(b), to include an amount in income in respect of the Award of Restricted Stock in accordance with the requirements of Code Section 83(b). Grantee acknowledges that such election must be filed with the Internal Revenue Service within 30 days of the grant of the Award for which such election is made. Grantee is solely responsible for making such election.
6. Dividends and Voting Rights.
During the Restricted Period, the Grantee shall have the right to vote or execute proxies with respect to the shares of Restricted Stock subject to this Award and to receive any cash or stock dividends paid or distributed with respect thereto, unless and until the Restricted Stock is forfeited. Cash or stock dividends paid or distributed with respect to outstanding Restricted Stock shall be fully vested and nonforfeitable upon receipt. Notwithstanding the foregoing, in the case of a stock split affected by the Company by means of a stock dividend or any stock dividends affected as part of a recapitalization of the Company or similar event, any stock dividends distributed with respect to the underlying Restricted Stock shall be subject to the same restrictions provided for herein with respect to such Restricted Stock, and the dividend shares so paid or distributed shall be deemed Restricted Stock subject to all terms and conditions herein.
7. Delivery of Shares.
The Company shall not be obligated to deliver any shares of Common Stock if counsel to the Company determines that such sale or delivery would violate any applicable law or any rule or regulation of any governmental authority or any rule or regulation of, or agreement of the Company with, any securities exchange or association upon which the Common Stock is listed or quoted. The Company shall in no event be obligated to take any affirmative action in order to cause the delivery of shares of Common Stock to comply with any such law, rule, regulation or agreement.
8. Assignment of Award.
Except as otherwise permitted by the Committee, the Grantee’s rights under the Plan and this Agreement are personal; no assignment or transfer of the Grantee’s rights under and interest in this Award may be made by the Grantee other than by will or by the laws of
descent and distribution.
9. Restrictions on Common Stock.
In consideration of the Award being made hereunder, the Grantee agrees that the Company (or a representative of any underwriters, initial purchasers or placement agents the Company may designate) may, in connection with any offering of any securities of the Company require that the Grantee not sell or otherwise transfer or dispose of any shares of Common Stock or other securities of the Company during such period (not to exceed 180 days) following such offering or such other date as may be requested by the Company or such representative of the underwriters, initial purchasers or placement agents. For purposes of this restriction, the Grantee will be deemed to own shares of Common Stock which: (a) are owned directly or indirectly by the Grantee, including securities held for the Grantee’s benefit by nominees, custodians, brokers, or pledgees; (b) may be acquired by the Grantee under this Award at any time, or otherwise be acquired by the Grantee within 60 days of the offering or other date set by the Company or the representative of the underwriters; (c) are owned directly or indirectly, by or for the Grantee’s spouse and any of his children who reside at his principal residence and over which Grantee can exercise dispositive authority; or (d) are owned, directly or indirectly, by or for a corporation, partnership, estate, or trust of which the Grantee is a shareholder, partner, beneficiary, or trustee and over which Grantee can exercise dispositive authority, but in the event the Grantee is a shareholder, partner, or beneficiary, only to the extent of the Grantee’s proportionate interest therein as a shareholder, partner, or beneficiary thereof. The Grantee further agrees that the Company may impose “stop transfer” instructions with respect to securities subject to the foregoing restrictions until the end of such period.
10. Restrictive Legend or Notation.
Certificates or book-entry account representing the Common Stock issued pursuant to the Award will bear all legends or notations required by law or determined by the Company or its counsel as necessary or advisable to effectuate the provisions of the Plan and this Award. The Company may place a “stop transfer” order against shares of the Common Stock issued pursuant to this Award until all restrictions and conditions set forth in the Plan or this Agreement and in the legends or notations referred to in this Section 10 have been complied with. The stock transfer records of the Company will reflect stock transfer instructions with respect to such shares.
11. Successors and Assigns.
This Agreement shall bind and inure to the benefit of and be enforceable by the Grantee, the Company and their respective permitted successors and assigns (including personal representatives, heirs and legatees), except that the Grantee may not assign any rights or obligations under this Agreement except to the extent and in the manner expressly permitted herein.
12. Tax Matters.
Grantee acknowledges that the tax consequences associated with the Award are complex and that the Company has urged Grantee to review with the Grantee’s own tax advisors
the federal, state and local tax consequences of this Award. Grantee is relying solely on such advisors and not on the statements or representations of the Company or its agents. Grantee understands that Grantee (and not the Company) will be responsible for Grantee’s own tax liability that may arise as a result of the Award.
13. Governing Law.
This Agreement shall be governed by, construed, and enforced in accordance with the laws of the State of Texas without regard to any jurisdiction’s choice of law principles.
14. Amendment.
This Agreement cannot be modified, altered or amended except by an agreement, in writing, signed by both the Company and the Grantee.
15. Dispute Resolution.
The provisions of this Section 15 shall be the exclusive means of resolving disputes of between the Grantee and the Company arising from the Plan or this Agreement. The parties shall attempt in good faith to resolve any disputes arising out of or relating to the Plan or this Agreement by negotiation between individuals who have authority to settle the controversy. Within 30 days of written notification regarding a dispute, the parties shall meet at such times and places as may be required to attempt to resolve the dispute. If the dispute has not been resolved within 90 days of the written notification, either party may file suit and all parties agree that any suit, action or proceeding arising in connection with the Plan or this Agreement shall be brought in the United States District Court of the Southern District of Texas (or should such Court lack jurisdiction to hear such action, suit or proceeding, in a Texas state court in Harris County, Texas) and that the parties shall submit to the jurisdiction of such court. The parties to this Agreement irrevocably waive, to the fullest extent permitted by law, any objection a party may have to the laying of venue for any such suit, action or proceeding brought in such court. THE PARTIES ALSO WAIVE ANY RIGHT THEY HAVE OR MAY HAVE TO A JURY TRIAL OF ANY SUCH SUIT, ACTION OR PROCEEDING. If any one or more provisions of this Section 15 shall for any reason be held invalid or unenforceable, it is the specific intent of the parties that such provisions shall be modified to the minimum extent necessary to make it or its application valid and enforceable.
16. No Continued Service Guaranteed.
No provision of this Agreement, and no action of the Company with respect hereto, shall confer or be construed to confer any right upon the Grantee to continue as a member of the Board.
[Signature page follows]
Exhibit 5.1
[Letterhead of Sutherland Asbill & Brennan LLP]
May 5, 2015
Main Street Capital Corporation
1300 Post Oak Boulevard, 8th Floor
Houston, TX 77056
Re:
Main Street Capital Corporation
Registration Statement on Form S-8
Ladies and Gentlemen:
We have acted as counsel to Main Street Capital Corporation, a Maryland corporation (the “Company” ), in connection with the preparation and filing by the Company with the Securities and Exchange Commission of a registration statement on Form S-8 (the “ Registration Statement ”) under the Securities Act of 1933, as amended (the “ Securities Act ”), with respect to the offer and sale of up to (i) 3,000,000 shares of the Company’s common stock, par value $0.01 per share (“ Common Stock ”), pursuant to the Main Street Capital Corporation 2015 Equity and Incentive Plan (the “ Employee Plan ”) and (ii) 300,000 shares of Common Stock pursuant to the Main Street Capital Corporation 2015 Non-Employee Director Restricted Stock Plan (the “ Director Plan, ” and together with the Employee Plan, the “ Plans ”).
As counsel to the Company, we have participated in the preparation of the Registration Statement and have examined originals or copies, certified or otherwise identified to our satisfaction by public officials or officers of the Company as authentic copies of originals, of (i) the Company’s Articles of Amendment and Restatement, certified as of the date hereof by an officer of the Company, (ii) the Company’s Amended and Restated Bylaws, certified as of the date hereof by an officer of the Company, (iii) a Certificate of Good Standing, dated May 4, 2015, with respect to the Company from the State of Maryland issued by the Maryland State Department of Assessments and Taxation as of a recent date; (iv) resolutions of the board of directors of the Company relating to the authorization and approval of the preparation and filing of the Registration Statement and the authorization, issuance, offer and sale of the Common Stock pursuant to the Registration Statement and the Plans, certified as of the date hereof by an officer of the Company, and (v) such other documents or matters of law as in our judgment were necessary to enable us to render the opinions expressed below.
With respect to such examination and our opinion expressed herein, we have assumed, without any independent investigation or verification (i) the genuineness of all signatures on all documents submitted to us for examination, (ii) the legal capacity of all natural persons, (iii) the authenticity of all documents submitted to us as originals, (iv) the conformity to original documents of all documents submitted to us as conformed or reproduced copies and the authenticity of the originals of such copied documents, and (v) that all certificates issued by public officials have been properly issued. We also have assumed without independent investigation or verification the accuracy and completeness of all corporate records made available to us by the Company.
Where factual matters material to this opinion letter were not independently established, we have relied upon certificates and/or representations of officers of the Company. We have also relied on certificates of public officials. Except as otherwise stated herein, we have not independently established the facts, or in the case of certificates of public officials, the other statements, so relied upon.
This opinion is limited to the General Corporation Law of the State of Maryland, as in effect on the date hereof, and we express no opinion with respect to any other laws of the State of Maryland or the laws of any other jurisdiction. We express no opinion as to any state securities or broker-dealer laws or regulations thereunder relating to the offer, issuance and sale of the Common Stock pursuant to the Registration Statement and the Plans. This opinion letter has been prepared, and should be interpreted, in accordance with customary practice followed in the preparation of opinion letters by lawyers who regularly give, and such customary practice followed by lawyers who on behalf of their clients regularly advise opinion recipients regarding, opinion letters of this kind.
Based on the foregoing, and subject to the qualifications stated herein, we are of the opinion that the shares of Common Stock issuable pursuant to the Registration Statement and the Plans will be, when issued and paid for in accordance with the Plans, validly issued, fully paid and nonassessable.
This opinion is limited to the matters expressly set forth herein, and no opinion may be implied or inferred beyond those expressly stated. Our opinions and other statements expressed herein are as of the date hereof, and we have no obligation to update this opinion letter or to advise you of any changes in applicable law or any other matters that may come to our attention after the date hereof.
We hereby consent to the filing of this opinion letter as an exhibit to the Registration Statement. We do not admit by giving this consent that we are in the category of persons whose consent is required under Section 7 of the Securities Act.
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Respectfully submitted, |
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/s/ Sutherland Asbill & Brennan LLP |
Exhibit 23.1
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We have issued our reports dated February 27, 2015 with respect to the consolidated financial statements, financial highlights, and Schedule 12-14 included in the Annual Report on Form 10-K for the year ended December 31, 2014 of Main Street Capital Corporation, which are incorporated by reference in this Registration Statement. We consent to the incorporation by reference in the Registration Statement of the aforementioned reports.
/s/ GRANT THORNTON LLP
Dallas, Texas
May 5, 2015