1396440--3/21/2008--Main_Street_Capital

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{investment, property, distribution}

{tax, income, asset}

{loan, real, estate}

{stock, price, operating}

{debt, indebtedness, cash}

{regulation, change, law}

{stock, price, share}

{provision, law, control}

{personnel, key, retain}

{condition, economic, financial}

We may face increasing competition for investment opportunities. We are dependent upon our key investment personnel for our future success. We have limited operating history as a BDC and as a RIC. Because we borrow money, the potential for gain or loss on amounts invested in us is magnified and may increase the risk of investing in us. SBA regulations limit the outstanding dollar amount of SBA-guaranteed debentures that may be issued by an SBIC or group of SBICs under common control. Our ability to enter into and exit investment transactions with our affiliates will be restricted. There are significant potential conflicts of interest which could impact our investment returns. We may experience fluctuations in our quarterly results. Our Board of Directors may change our operating policies and strategies without prior notice or stockholder approval, the effects of which may be adverse. We will be subject to corporate-level income tax if we are unable to qualify as a RIC under Subchapter M of the Code. We may not be able to pay you dividends, our dividends may not grow over time, and a portion of dividends paid to you may be a return of capital. We may have difficulty paying our required distributions if we recognize income before or without receiving cash representing such income. The Fund, as an SBIC, may be unable to make distributions to us that will enable us to meet or maintain RIC status, which could result in the imposition of an entity-level tax. Because we intend to distribute substantially all of our income to our stockholders in connection with our election to be treated as a RIC, we will continue to need additional capital to finance our growth, and regulations governing our operation as a BDC will affect our ability to, and the way in which we, raise additional capital. Changes in laws or regulations governing our operations may adversely affect our business or cause us to alter our business strategy. Efforts to comply with the Sarbanes-Oxley Act will involve significant expenditures, and non-compliance with the Sarbanes-Oxley Act may adversely affect us. RISKS RELATED TO OUR INVESTMENTS Our investments in portfolio companies may be risky, and we could lose all or part of our investment. The lack of liquidity in our investments may adversely affect our business. We may not have the funds or ability to make additional investments in our portfolio companies. Our portfolio companies may incur debt that ranks equally with, or senior to, our investments in such companies. There may be circumstances where our debt investments could be subordinated to claims of other creditors or we could be subject to lender liability claims. Second priority liens on collateral securing loans that we make to our portfolio companies may be subject to control by senior creditors with first priority liens. If there is a default, the value of the collateral may not be sufficient to repay in full both the first priority creditors and us. If we do not invest a sufficient portion of our assets in qualifying assets, we could fail to maintain our qualification as a BDC or be precluded from investing according to our current business strategy. We are a non-diversified investment company within the meaning of the 1940 Act, and therefore we are not limited with respect to the proportion of our assets that may be invested in securities of a single issuer. We generally will not control our portfolio companies. Economic recessions or downturns could impair our portfolio companies and harm our operating results. Defaults by our portfolio companies will harm our operating results. Prepayments of our debt investments by our portfolio companies could adversely impact our results of operations and reduce our return on equity. Changes in interest rates may affect our cost of capital and net investment income. We may not realize gains from our equity investments. RISKS RELATING TO OUR COMMON STOCK Shares of closed-end investment companies, including BDCs, may trade at a discount to their net asset value. Investing in our common stock may involve an above average degree of risk. The market price of our common stock may fluctuate significantly. Provisions of the Maryland General Corporation Law and our articles of incorporation and bylaws could deter takeover attempts and have an adverse impact on the price of our common stock.

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1396440--3/21/2008--Main_Street_Capital_CORP