Net Increase in Net Assets from Operations
For the three months and year ended December 31, 2011, the net increase in net assets from operations was $7.0 million and $76.9 million, or $0.10 per share and $1.05 per share, respectively, compared to $2.4 million and $71.5 million, or $0.03 per share and $1.14 per share, for the three months and year ended December 31, 2010. As compared to the prior year, the increase primarily reflects the increase in net investment income as well as the decrease in net unrealized depreciation on investments, net of realized gains and losses, for the year ended December 31, 2011.
Liquidity and Capital Resources
At December 31, 2011, we had approximately $8 million in cash and cash equivalents, $343 million in debt outstanding and, subject to leverage and borrowing base restrictions, $207 million available for use under our senior secured, multi-currency credit facility, which matures in December 2013. At December 31, 2011, we were in compliance with regulatory coverage requirements with an asset coverage ratio of 301% 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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