OHA Investment Corporation
NGP Capital Resources Co (Form: 10-Q, Received: 05/06/2011 17:15:13)

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q
(Mark One)
þ
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2011
 
or

¨
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _____________ to _______________

Commission file number: 814-00672
 

 
NGP Capital Resources Company
(Exact name of registrant as specified in its charter)
 

 
Maryland
20-1371499
(State or other jurisdiction of
incorporation or organization)
(I.R.S. Employer
Identification No.)
   
1221 McKinney Street, Suite 2975
Houston, Texas
77010
(Address of principal executive offices)
(Zip Code)

(713) 752-0062
(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.   Yes  þ   No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ¨ No ¨

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.

Large accelerated filer   ¨
Accelerated filer     þ
Non-accelerated filer     ¨
Smaller reporting company   ¨
   
(Do not check if smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes ¨   No þ

As of May 3, 2011, there were 21,628,202 shares of the registrant’s common stock outstanding.
 
 
 

 

TABLE OF CONTENTS

PART I - FINANCIAL INFORMATION
 
1
     
Item 1.     Financial Statements
 
1
Item 2.     Management’s Discussion and Analysis of Financial Condition and Results of Operations
 
31
Item 3.     Quantitative and Qualitative Disclosures About Market Risk
 
38
Item 4.     Controls and Procedures
 
39
     
PART II – OTHER INFORMATION
 
40
     
Item 1.     Legal Proceedings
 
40
Item 1A.  Risk Factors
 
40
Item 6.     Exhibits
  
40
 
 
 

 

PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
NGP CAPITAL RESOURCES COMPANY
CONSOLIDATED BALANCE SHEETS
 
   
March 31, 2011
   
December 31, 2010
 
   
(Unaudited)
       
             
Assets
           
Investments in portfolio securities at fair value
           
Control investments - majority owned
           
(cost: $94,378,591 and $89,502,910, respectively)
  $ 79,276,359     $ 70,973,316  
Affiliate investments
               
(cost: $35,771,803 and $34,146,328, respectively)
    23,495,180       33,064,028  
Non-affiliate investments
               
(cost: $95,726,987 and $114,852,057, respectively)
    94,241,048       112,025,645  
Investments in U.S. Treasury Bills at fair value
               
(cost: $30,600,288 and $0, respectively)
    30,600,314       -  
Total investments
    227,612,901       216,062,989  
                 
Cash and cash equivalents
    57,962,633       68,456,908  
Accounts receivable and other current assets
    1,316,303       3,095,882  
Interest receivable
    891,110       2,236,122  
Prepaid assets
    1,629,184       1,736,732  
Deferred tax assets
    1,529,867       -  
Total current assets
    63,329,097       75,525,644  
                 
Total assets
  $ 290,941,998     $ 291,588,633  
                 
Liabilities and stockholders' equity (net assets)
               
Current liabilities
               
Accounts payable and accrued expenses
  $ 535,368     $ 525,111  
Management and incentive fees payable
    1,333,288       1,376,032  
Dividends payable
    3,893,076       3,893,076  
Income taxes payable
    60,136       50,350  
Current portion of long-term debt
    30,000,000       -  
Total current liabilities
    35,821,868       5,844,569  
                 
Deferred tax liabilities
    1,546,503       18,136  
Long-term debt, less current portion
    25,000,000       50,000,000  
                 
Total liabilities
    62,368,371       55,862,705  
                 
Commitments and contingencies  (Note 6)
               
                 
Stockholders’ equity (net assets)
               
Common stock, $.001 par value, 250,000,000 shares authorized;
               
21,628,202 shares issued and outstanding
    21,628       21,628  
Paid-in capital in excess of par
    293,789,803       293,789,803  
Undistributed net investment income (loss)
    (8,741,083 )     (7,845,925 )
Undistributed net realized capital gain (loss)
    (33,303,581 )     (32,778,782 )
Net unrealized appreciation (depreciation) of portfolio securities
               
and commodity derivative instruments
    (23,193,140 )     (17,460,796 )
                 
Total stockholders’ equity (net assets)
    228,573,627       235,725,928  
                 
Total liabilities and stockholders' equity (net assets)
  $ 290,941,998     $ 291,588,633  
                 
Net asset value per share
  $ 10.57     $ 10.90  

(See accompanying notes to consolidated financial statements)
 
 
1

 

NGP CAPITAL RESOURCES COMPANY
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)

   
For The Three Months Ended
 
   
March 31, 2011
   
March 31, 2010
 
             
Investment income
           
Interest income:
           
Control investments - majority owned
  $ 1,355,909     $ 1,099,979  
Affiliate investments
    951,865       832,913  
Non-affiliate investments
    3,479,005       3,177,541  
Royalty income (loss), net of amortization:
               
Control investments - majority owned
    478,350       294,811  
Non-affiliate investments
    255,782       (518,056 )
Commodity derivative income, net of expired options
    -       16,079  
Other income
    33,750       290,000  
                 
Total investment income
    6,554,661       5,193,267  
                 
Operating expenses
               
Management and incentive fees
    1,333,288       1,338,569  
Professional fees
    199,040       265,304  
Insurance expense
    182,543       185,658  
Interest expense and fees
    309,421       313,063  
State and excise taxes
    656       -  
Other general and administrative expenses
    829,079       946,420  
                 
Total operating expenses
    2,854,027       3,049,014  
                 
Net investment income before income taxes
    3,700,634       2,144,253  
                 
Benefit (provision) for income taxes
    (702,716 )     287,074  
                 
Net investment income
    2,997,918       2,431,327  
                 
Net realized capital gain (loss) on investments
               
Net realized capital gain (loss) on portfolio securities:
               
Control investments - majority owned
    81,275       -  
Non-affiliate investments
    (606,361 )     -  
Benefit (provision) for taxes on capital gain (loss)
    287       (9,151 )
                 
Total net realized capital gain (loss) on investments
    (524,799 )     (9,151 )
                 
Net unrealized gain (loss) on investments
               
Net increase (decrease) in unrealized appreciation
               
(depreciation) on portfolio securities and
               
commodity derivative instruments:
               
Control investments - majority owned
    3,427,363       6,501  
Affiliate investments
    (11,194,323 )     558,719  
Non-affiliate investments
    1,340,473       2,313,989  
Benefit (provision) for taxes on unrealized gain (loss)
    694,143       (293,149 )
                 
Total net unrealized gain (loss) on investments
    (5,732,344 )     2,586,060  
                 
Net increase (decrease) in stockholders' equity
               
(net assets) resulting from operations
  $ (3,259,225 )   $ 5,008,236  
                 
Net increase (decrease) in stockholders' equity (net assets)
               
resulting from operations per common share
  $ (0.15 )   $ 0.24  

(See accompanying notes to consolidated financial statements)
 
 
2

 

NGP CAPITAL RESOURCES COMPANY
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY (NET ASSETS)
(Unaudited)

                                   
Net Unrealized
       
               
Paid-in
         
Undistributed
   
Appreciation
   
Total
 
               
Capital
   
Undistributed
   
Net Realized
   
(Depreciation)
   
Stockholders'
 
   
Common Stock
   
in Excess
   
Net Investment
   
Capital
   
of Portfolio
   
Equity
 
   
Shares
   
Amount
   
of Par
   
Income (Loss)
   
Gain (Loss)
   
Securities
   
(Net Assets)
 
Balance at December 31, 2010
    21,628,202     $ 21,628     $ 293,789,803     $ (7,845,925 )   $ (32,778,782 )   $ (17,460,796 )   $ 235,725,928  
Net increase (decrease) in in stockholders' equity (net assets) resulting from operations
    -       -       -       2,997,918       (524,799 )     (5,732,344 )     (3,259,225 )
                                                         
Dividends declared
    -       -       -       (3,893,076 )     -       -       (3,893,076 )
Balance at March 31, 2011
    21,628,202     $ 21,628     $ 293,789,803     $ (8,741,083 )   $ (33,303,581 )   $ (23,193,140 )   $ 228,573,627  

(See accompanying notes to consolidated financial statements)
 
 
3

 

NGP CAPITAL RESOURCES COMPANY
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)

   
For The Three Months Ended
 
   
March 31, 2011
   
March 31, 2010
 
             
Cash flows from operating activities
           
Net increase (decrease) in stockholders' equity (net assets) resulting from operations
  $ (3,259,225 )   $ 5,008,236  
Adjustments to reconcile net increase (decrease) in stockholders' equity (net assets)
               
resulting from operations to net cash (used in) provided by operating activities
               
Payment-in-kind interest
    (1,459,899 )     (1,731,489 )
Net amortization of premiums, discounts and fees
    464,832       2,968,431  
Net realized capital loss on portfolio securities before taxes
    525,086       -  
          Change in unrealized  (appreciation) depreciation on portfolio securities  
               
and commodity derivative instruments before taxes
    6,426,487       (2,879,209 )
Current portion of deferred income taxes
    (1,529,867 )     (266,975 )
Non-current deferred income taxes
    1,528,367       266,975  
Effects of changes in operating assets and liabilities
               
Accounts receivable and other current assets
    1,779,579       9,316  
Interest receivable
    1,345,012       407,567  
Prepaid assets
    107,548       297,444  
Accounts payable and accrued expenses
    (32,487 )     (68,120 )
Income taxes payable
    9,786       15,226  
Purchase of investments in portfolio securities and commodity
               
derivative instruments
    (14,756,788 )     (3,294,585 )
Proceeds from the redemption of investments in portfolio securities
               
and commodity derivative instruments
    27,850,658       2,587,715  
Purchase of investments in U.S. Treasury Bills
    (30,600,288 )     -  
                 
Net cash (used in) provided by operating activities
    (11,601,199 )     3,320,532  
                 
Cash flows from financing activities
               
Borrowings under revolving credit facilities
    55,000,000       64,905,200  
Repayments on revolving credit facility
    (50,000,000 )     (67,500,000 )
Dividends paid
    (3,893,076 )     (3,676,794 )
                 
Net cash (used in) provided by financing activities
    1,106,924       (6,271,594 )
                 
Net increase (decrease) in cash and cash equivalents
    (10,494,275 )     (2,951,062 )
Cash and cash equivalents, beginning of period
    68,456,908       108,288,217  
                 
Cash and cash equivalents, end of period
  $ 57,962,633     $ 105,337,155  

(See accompanying notes to consolidated financial statements)
 
 
4

 

NGP CAPITAL RESOURCES COMPANY
CONSOLIDATED SCHEDULE OF INVESTMENTS
March 31, 2011
(Unaudited)

Portfolio Company
 
Energy Industry Segment
 
Investment (1) (2) (4)
 
Principal
   
Cost
   
Fair Value (3)
 
TARGETED INVESTMENTS
                     
Control Investments - Majority Owned (50% or more owned)
                     
Alden Resources, LLC (7)
 
Coal Production
 
Senior Secured
  $ 16,497,033     $ 15,254,073     $ 15,154,073  
       
Multiple-Advance Term Loan - Tranche A
                       
       
(The greater of 12.00% or LIBOR +
                       
       
9.00% cash, due 1/05/2013)
                       
                                 
       
Senior Secured
    25,254,049       19,519,841       19,519,841  
       
Multiple-Advance Term Loan - Tranche B
                       
       
(The greater of 12.00% or LIBOR +
                       
       
9.00% cash, 15.00% or LIBOR +
                       
       
12.00% PIK, due 1/05/2013) (9)
                       
                                 
       
Senior Secured
    6,240,000       6,240,000       6,240,000  
       
Multiple-Advance Term Loan - Revolver
                       
       
(The greater of 12.00% or LIBOR +
                       
       
9.00% cash, 15.00% or LIBOR +
                       
       
12.00% PIK, due 1/05/2013)
                       
                                 
       
5.8 million Class E Units - entitled  to
            5,800,000       5,800,000  
       
 100% of distributions of Alden Resources
                       
       
until payout, 80% after payout (8)
                       
                                 
       
Royalty Interest
            2,473,687       13,200,000  
                                 
BSR Holdings, LLC (7) (18)
 
Oil & Natural Gas
 
100% of membership interests of
            -       -  
   
 Production and Development
 
BSR Holdings, LLC (8)
                       
                                 
DeanLake Operator, LLC (7)
 
Oil & Natural Gas
 
Class A membership interests - entitled to 100%
            14,050,255       3,500,000  
   
 Production and Development
 
of distribution of DeanLake Operator, LLC
                       
       
until payout, 80% after payout (8)
                       
                                 
       
Overriding Royalty Interest
            17,502       50,000  
                                 
Gatliff Services, LLC (7)
 
Coal Processing
 
Senior Secured
    13,212,445       13,212,445       13,212,445  
       
Multiple-Advance Term Loan
                       
       
(8.00% during construction, 12.00%
                       
       
after completion, due 9/30/2020)
                       
                                 
       
One Membership Unit - representing 100%
            1,100,000       1,100,000  
       
ownership of Gatliff Services, LLC  (8)
                       
                                 
Rubicon Energy Partners,
 
Oil & Natural Gas
 
4,000 LLC Units representing
            -       -  
LLC (7)
 
 Production and Development
 
50% ownership of the assets of
                       
       
Rubicon Energy Partners, LLC (8)
                       
                                 
TierraMar Energy, LP (7)
 
Oil & Natural Gas
 
212,637 Class A Preferred LP Units - entitled to
            16,710,788       1,500,000  
   
 Production and Development
 
100% of distribution of TierraMar Energy LP
                       
       
until payout, 67% after payout (8)
                       
                                 
Subtotal Control Investments - Majority Owned (50% or more owned)
          $ 94,378,591     $ 79,276,359  

(See accompanying notes to consolidated financial statements)
 
 
5

 

NGP CAPITAL RESOURCES COMPANY
CONSOLIDATED SCHEDULE OF INVESTMENTS
March 31, 2011
(Unaudited)
(continued)

Portfolio Company
 
Energy Industry Segment
 
Investment (1) (2) (4)
 
Principal
   
Cost
   
Fair Value (3)
 
TARGETED INVESTMENTS  - Continued
                     
Affiliate Investments - (5% to 25% owned)
                     
BioEnergy Holding, LLC (7)
 
Alternative Fuels and
 
Senior Secured Notes
  $ 16,662,326     $ 15,527,504     $ 7,763,752  
   
Specialty Chemicals
 
(15.00%, due 3/06/2015) (9)
                       
       
BioEnergy Holding Units - 11.1% of outstanding
            1,296,771       -  
       
units of BioEnergy Holdings, LLC (8)
                       
       
Myriant Technologies Warrants (8) (13)
            49,238       49,238  
       
Myriant Technologies Units - 0.59% of the
            418,755       706,132  
       
outstanding units of Myriant Technologies, Inc.(8)
                       
                                 
Bionol Clearfield, LLC (7) (11) (17)
 
Alternative Fuels and
 
Senior Secured Tranche C
    4,950,000       4,950,000       2,475,000  
   
Specialty Chemicals
 
2nd Lien Term Loan (8)
                       
       
(LIBOR + 7.00% cash, LIBOR + 9.00%
                       
       
default, due 9/06/2016) (19)
                       
                                 
Resaca Exploitation Inc.
 
Oil & Natural Gas
 
Senior Unsecured Term Loan
    10,282,611       10,044,281       10,044,281  
   
 Production and Development
 
(9.50% cash or 12.0% PIK,
                       
       
due on 12/31/2014) (7)
                       
                                 
       
Warrants (7) (8) (21)
            250,000       250,000  
                                 
       
Common Stock (1,345,595 shares) - representing
            3,235,254       2,206,777  
       
6.82% of outstanding common stock of
                       
       
Resaca Exploitation Inc. (6) (8) (14)
                       
                                 
Subtotal Affiliate Investments - (5% to 25% owned)
              $ 35,771,803     $ 23,495,180  
                                 
Non-affiliate Investments - (Less than 5% owned)
                           
                                 
Anadarko Petroleum Corporation
 
Oil & Natural Gas
 
Multiple-Advance Net Profits Interest
  $ 9,433,760     $ 9,478,460     $ 9,778,459  
2007-III Drilling Fund (7)
 
 Production and Development
 
(Due 4/23/2032)
                       
                                 
ATP Oil & Gas Corporation (7)
 
Oil & Natural Gas
 
Limited Term Royalty Interest
            4,530,324       4,530,324  
   
 Production and Development
 
(Dollar Denominated - 16.00% Return)
                       
                                 
Black Pool Energy
 
Oil & Natural Gas
 
Senior Secured
    17,609,600       17,509,047       17,509,047  
Partners, LLC (7)
 
 Production and Development
 
Multiple-Advance Term Loan
                       
       
(The greater of 15.00% or LIBOR +
                       
       
11.00% cash, due 10/24/2011)
                       
       
Overriding Royalty Interest
            9,343       100,000  
       
Warrants (8) (15)
            10,000       10,000  
                                 
Chroma Exploration &
 
Oil & Natural Gas
 
10,930 Shares Series A Participating
            2,221,710       100,000  
Production, Inc. (7)
 
 Production and Development
 
Convertible Preferred Stock (9)
                       
       
9,981 Shares Series AA Participating
            2,089,870       650,000  
       
Convertible Preferred Stock (9)
                       
       
8.11 Shares Common Stock (8)
            -       -  
       
Warrants (8) (10)
            -       -  
                                 
Crestwood Holdings, LLC (7)
 
Natural Gas
 
Senior Secured Term Loan
    8,857,500       8,710,486       8,710,486  
   
Gathering and Processing
 
(The greater of 10.50% or LIBOR + 8.50%,
                       
       
due 10/01/2016)
                       
                                 
Greenleaf Investments, LLC (7)
 
Oil & Natural Gas
 
Senior Secured
    8,065,189       8,054,076       8,054,076  
   
 Production and Development
 
Multiple-Advance Term Loan
                       
       
(The greater of 10.50% or LIBOR + 6.50%,
                       
       
due 4/30/2011)
                       
       
Overriding Royalty Interest
            16,305       400,000  

(See accompanying notes to consolidated financial statements)
 
 
6

 

NGP CAPITAL RESOURCES COMPANY
CONSOLIDATED SCHEDULE OF INVESTMENTS
March 31, 2011
(Unaudited)
(continued)

Portfolio Company
 
Energy Industry Segment
 
Investment (1) (2) (4)
 
Principal
   
Cost
   
Fair Value (3)
 
TARGETED INVESTMENTS  - Continued
                     
Non-affiliate Investments - (Less than 5% owned) - Continued
                 
GMX Resources, Inc. (6)
 
Oil & Natural Gas
 
Senior Convertible Notes
  $ 4,661,000     $ 3,918,451     $ 4,352,209  
   
 Production and Development
 
(5.00%, due 2/1/2013)
                       
                                 
Nighthawk Transport I, LP (7)
 
Energy Services
 
LP Units (8) (20)
            -       -  
       
Warrants (8) (20)
            -       -  
                                 
Pallas Contour Mining, LLC (7)
 
Coal Mining
 
Senior Secured
    13,661,290       13,709,145       13,709,145  
       
Multiple-Advance Term Loan
                       
       
(14.00%, due 10/14/2015)
                       
                                 
Powder River Acquisitions, LLC (7)
 
Oil & Natural Gas
 
Senior Secured
    3,000,000       3,000,000       3,000,000  
   
 Production and Development
 
Promissory Note
                       
       
(8.00%, due 9/30/2011)
                       
                                 
Tammany Oil & Gas, LLC (7)
 
Oil & Natural Gas
 
Senior Secured
    22,332,804       22,317,302       22,317,302  
   
 Production and Development
 
Multiple-Advance Term Loan
                       
       
(The greater of 13.0% or LIBOR + 8.00%,
                       
       
 due 9/30/2012)
                       
                                 
       
Overriding Royalty Interest
            132,468       1,000,000  
       
After Pay-Out Overriding Royalty Interest (8) (16)
            10,000       10,000  
       
Warrants (8) (12) (16)
            10,000       10,000  
                                 
Subtotal Non-affiliate Investments - (Less than 5% owned)
              $ 95,726,987     $ 94,241,048  
                                 
Subtotal Targeted Investments (86.55% of total investments)
              $ 225,877,381     $ 197,012,587  
                                 
GOVERNMENT SECURITIES (5)
                           
U.S. Treasury Bills
     
U.S. Treasury Bills, 0.03%, due 04/28/2011
    30,000,000       29,999,300       29,999,325  
U.S. Treasury Bills
     
U.S. Treasury Bills, 0.025%, due 04/28/2011
    601,000       600,988       600,989  
                                 
Subtotal Government Securities (13.45% of total investments)
          $ 30,600,288     $ 30,600,314  
                                 
TOTAL INVESTMENTS
              $ 256,477,669     $ 227,612,901  

(See accompanying notes to consolidated financial statements)
 
 
7

 

NGP CAPITAL RESOURCES COMPANY
CONSOLIDATED SCHEDULE OF INVESTMENTS
March 31, 2011
(Unaudited)
(continued)

 
NOTES TO CONSOLIDATED SCHEDULE OF INVESTMENTS

(1)
All of our investments are collateral for obligations under our credit facility.
(2)
Percentages represent interest rates in effect at the end of the period and due dates represent the contractual maturity dates.
(3)
Our Board of Directors determines, in good faith, the fair value of our investments.
(4)
All investments are in entities with primary operations in the United States of America.
(5)
Investments are level 1 securities hierarchy.
(6)
Investments are level 2 securities hierarchy.
(7)
Investments are level 3 securities hierarchy.
(8)
Non-income producing securities.
(9)
Non-accrual status.
(10)
Chroma warrants expire on April 5, 2012 and provide us the right to purchase 2,462 shares of common stock at a purchase price of $75.00 per share.
(11)
BioEnergy Holdings, LLC owns 100% of Bionol Clearfield, LLC.
(12)
Tammany Oil & Gas, LLC warrants expire five years after repayment of principal and interest and provide us the right to purchase approximately 20% of membership shares at the exercise price of approximately $17.61 per share.
(13)
Myriant Technologies, Inc. warrants expire on August 15, 2015 and provide us the right to purchase  32,680 units, representing membership interests of Myriant Technologies, Inc., at the  purchase price of $10.00 per unit.
(14)
Resaca Exploitation, Inc. stock trades on the Alternative Investment Market of the London Stock Exchange.  On April 1, 2010, it began trading in U.S Dollars.
(15)
Black Pool warrants expire seven years after repayment of principal and interest and provide us the right to purchase approximately 25% of membership interest at the exercise price of $0.01 per unit.
(16)
Tammany Oil & Gas, LLC retains the right to repurchase the after pay-out ORRI and 10% warrants for $1,250,000 on or before September 30, 2011.
(17)
We issued a forbearance agreement to Bionol Clearfield, LLC on June 16, 2010 due to a default event.
(18)
Oil and gas assets owned by BSR Holdings, LLC were sold on October 13, 2010.
(19)
Bionol Clearfield, LLC (Bionol) has not paid scheduled interest payments since  March 10, 2010 due to a default event involving a Bionol customer, as per the terms of our credit agreement with Bionol.  Bionol and the customer are currently in arbitration and we do not know when or whether Bionol will be able to make its scheduled interest payments.
(20)
Due to insufficient recoveries in the liquidation under Nighthawk's voluntary petition under Chapter 7 of the United States Bankruptcy Code, we recognized a realized loss of our total remaining investment in Nighthawk notes in December 2009.  We retain ownership in warrants and units in Nighthawk and have assigned no value to that interest.
(21)
Resaca Exploitation, Inc. warrants expire 10 business days following termination of the credit agreement and entitle us to purchase up to 2,420,000 shares of Resaca common stock at a purchase price of $1.93 per share.

(See accompanying notes to consolidated financial statements)
 
 
8

 

NGP CAPITAL RESOURCES COMPANY
CONSOLIDATED SCHEDULE OF INVESTMENTS
December 31, 2010

Portfolio Company
 
Energy Industry Segment
 
Investment (1) (2) (4)
 
Principal
   
Cost
   
Fair Value (3)
 
TARGETED INVESTMENTS
                     
Control Investments - Majority Owned (50% or more owned)
                     
Alden Resources, LLC (17)
 
Coal Production
 
Senior Secured
  $ 16,497,033     $ 15,106,754     $ 15,006,754  
       
Multiple-Advance Term Loan - Tranche A
                       
       
(The greater of 12.00% or LIBOR +
                       
       
9.00% cash, due 1/05/2013) (18)
                       
                                 
       
Senior Secured
    24,330,226       19,519,841       19,519,841  
       
Multiple-Advance Term Loan - Tranche B
                       
       
(The greater of 12.00% or LIBOR +
                       
       
9.00% cash, 15.00% or LIBOR +
                       
       
12.00% PIK, due 1/05/2013) (6)
                       
                                 
       
Senior Secured
    3,000,000       3,000,000       3,000,000  
       
Multiple-Advance Term Loan - Revolver
                       
       
(The greater of 12.00% or LIBOR +
                       
       
9.00% cash, 15.00% or LIBOR +
                       
       
12.00% PIK, due 1/05/2013) (18)
                       
                                 
       
5.8 million Class E Units - entitled  to
            5,800,000       5,800,000  
       
 100% of distributions of Alden Resources
                       
       
until payout, 80% after payout (5)
                       
                                 
       
Royalty Interest
            2,486,020       10,300,000  
                                 
BSR Holdings, LLC (15) (17)
 
Oil & Natural Gas
 
100% of membership interests of
            -       -  
   
 Production and Development
 
BSR Holdings, LLC.
                       
                                 
DeanLake Operator, LLC (17)
 
Oil & Natural Gas
 
Class A membership interests - entitled to 100%
            14,050,255       3,500,000  
   
 Production and Development
 
of distribution of DeanLake Operator, LLC
                       
       
until payout, 80% after payout (5)
                       
                                 
       
Overriding Royalty Interest
            17,622       50,000  
                                 
Gatliff Services, LLC (17)
 
Coal Processing
 
Senior Secured
    11,696,721       11,696,721       11,696,721  
       
Multiple-Advance Term Loan
                       
       
(8.00% during construction, 12.00%
                       
       
after completion, due 9/30/2020)
                       
                                 
       
One Membership Unit - representing 100%
            1,100,000       1,100,000  
       
ownership of Gatliff Services, LLC  (5)
                       
                                 
Rubicon Energy Partners,
 
Oil & Natural Gas
 
4,000 LLC Units representing
            -       -  
LLC (17)
 
 Production and Development
 
50% ownership of the assets of
                       
       
Rubicon Energy Partners, LLC (5)
                       
                                 
TierraMar Energy, LP (17)
 
Oil & Natural Gas
 
212,637 Class A Preferred LP Units - entitled to
            16,710,788       900,000  
   
 Production and Development
 
100% of distribution of TierraMar Energy LP
                       
       
until payout, 67% after payout (5)
                       
                                 
       
Overriding Royalty Interest
            14,909       100,000  
                                 
Subtotal Control Investments - Majority Owned (50% or more owned)
          $ 89,502,910     $ 70,973,316  

(See accompanying notes to consolidated financial statements)
 
 
9

 

NGP CAPITAL RESOURCES COMPANY
CONSOLIDATED SCHEDULE OF INVESTMENTS
December 31, 2010
(continued)

Portfolio Company
 
Energy Industry Segment
 
Investment (1) (2) (4)
 
Principal
   
Cost
   
Fair Value (3)
 
TARGETED INVESTMENTS  - Continued
                     
Affiliate Investments - (5% to 25% owned)
                     
BioEnergy Holding, LLC (17)
 
Alternative Fuels and
 
Senior Secured Notes
  $ 15,485,039     $ 14,302,570     $ 14,302,570  
   
Specialty Chemicals
 
(15.00%, due 3/06/2015)
                       
       
BioEnergy Holding Units - 11.1% of outstanding
            1,296,771       1,296,771  
       
units of BioEnergy Holdings, LLC (5)
                       
       
Myriant Technologies Warrants (5) (10)
            49,238       49,238  
       
Myriant Technologies Units - 1.9% of the
            418,755       418,755  
       
outstanding units of Myriant Technologies, LLC (5)
                       
                                 
Bionol Clearfield, LLC (8) (14) (17)
 
Alternative Fuels and
 
Senior Secured Tranche C
    4,950,000       4,950,000       4,950,000  
   
Specialty Chemicals
 
2nd Lien Term Loan
                       
       
(LIBOR + 7.00% cash, LIBOR + 9.00%
                       
       
default, due 9/06/2016) (19)
                       
                                 
Resaca Exploitation Inc.
 
Oil & Natural Gas
 
Senior Secured
    10,000,000       9,893,740       9,893,740  
   
 Production and Development
 
Revolving Credit Facility
                       
       
(The greater of 8.0% or LIBOR + 5.50%,
                       
       
due 7/01/2012) (17)
                       
       
Common Stock (1,345,595 shares) - representing
            3,235,254       2,152,954  
       
6.84% of outstanding common stock of
                       
       
Resaca Exploitation Inc. (5) (11) (16)
                       
                                 
Subtotal Affiliate Investments - (5% to 25% owned)
              $ 34,146,328     $ 33,064,028  
                                 
Non-affiliate Investments - (Less than 5% owned)
                           
                                 
Anadarko Petroleum Corporation
 
Oil & Natural Gas
 
Multiple-Advance Net Profits Interest
  $ 9,532,723     $ 9,586,637     $ 9,886,635  
2007-III Drilling Fund (17)
 
 Production and Development
 
(Due 4/23/2032)
                       
                                 
ATP Oil & Gas Corporation (17)
 
Oil & Natural Gas
 
Limited Term Royalty Interest
            6,548,318       6,548,318  
   
 Production and Development
 
(Dollar Denominated - 16.00% Return)
                       
                                 
Black Pool Energy
 
Oil & Natural Gas
 
Senior Secured
    17,895,000       17,754,507       17,754,507  
Partners, LLC (17)
 
 Production and Development
 
Multiple-Advance Term Loan
                       
       
(The greater of 15.00% or LIBOR +
                       
       
11.00% cash, due 10/24/2011)
                       
       
Overriding Royalty Interest
            9,750       100,000  
       
Warrants (5) (12)
            10,000       10,000