Net Increase in Net Assets from Operations
For the three and nine months ended September 30, 2011, the net increase in net assets from operations was $12.9 million and $69.9 million, or $0.18 per share and $0.96 per share, respectively, compared to $16.3 million and $69.1 million, or $0.25 per share and $1.15 per share, for the three and nine months ended September 30, 2010. As compared to the prior three-month period, the decrease primarily reflects the increase in net investment income as well as the increase in net unrealized depreciation on investments, net of realized gains, for the three months ended September 30, 2011.
Liquidity and Capital Resources
At September 30, 2011, we had approximately $30 million in cash and cash equivalents, $317 million in debt outstanding and, subject to leverage and borrowing base restrictions, $233 million available for use under our senior secured, multi-currency credit facility, which matures in December 2013. At September 30, 2011, we were in compliance with regulatory coverage requirements with an asset coverage ratio of 323% and were in compliance with all financial covenants under our debt agreements. In the near term, we expect to meet our liquidity needs through periodic add-on equity and debt offerings, use of the remaining availability under our credit facility and continued cash flows from operations. The primary use of funds will be investments in portfolio companies, reductions in debt outstanding and other general corporate purposes.On January 18, 2011, we closed a private placement issuance of $158 million in aggregate principal amount of five-year, senior secured notes with a fixed interest rate of 6.50% and a maturity date of January 18, 2016 and $17 million in aggregate principal amount of seven-year, senior secured notes with a fixed interest rate of 6.60% and a maturity date of January 18, 2018 (collectively, the “Senior Secured Notes”). The Senior Secured Notes were sold to certain institutional accredited investors pursuant to an exemption from registration under the Securities Act of 1933, as amended. Interest on the Senior Secured Notes is due semi-annually on January 18 and July 18, commencing on July 18, 2011. The proceeds from the issuance of the Senior Secured Notes were used to fund new portfolio investments, reduce outstanding borrowings under our credit facility and for general corporate purposes.
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