ý | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
¨ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Maryland | 06-1798488 | |
(State or other jurisdiction of | (I.R.S. Employer | |
incorporation or organization) | Identification No.) | |
3700 Glenwood Avenue, Suite 530 Raleigh, North Carolina | 27612 | |
(Address of principal executive offices) | (Zip Code) |
Large accelerated filer | ý | Accelerated filer | ¨ |
Non-accelerated filer | ¨ (Do not check if a smaller reporting company) | Smaller reporting company | ¨ |
Page | ||
PART I – FINANCIAL INFORMATION | ||
Item 1. | ||
Item 2. | Management's Discussion and Analysis of Financial Condition and Results of Operations | |
Item 3. | ||
Item 4. | ||
PART II – OTHER INFORMATION | ||
Item 1. | ||
Item 1A. | ||
Item 2. | ||
Item 3. | ||
Item 4. | ||
Item 5. | ||
Item 6. | ||
September 30, 2014 | December 31, 2013 | ||||||
(Unaudited) | |||||||
Assets: | |||||||
Investments at fair value: | |||||||
Non-Control / Non-Affiliate investments (cost of $702,046,342 and $528,021,069 at September 30, 2014 and December 31, 2013, respectively) | $ | 683,606,374 | $ | 546,043,946 | |||
Affiliate investments (cost of $143,870,717 and $107,418,051 at September 30, 2014 and December 31, 2013, respectively) | 146,887,741 | 107,536,534 | |||||
Control investments (cost of $17,223,222 and $18,378,665 at September 30, 2014 and December 31, 2013, respectively) | 11,128,000 | 10,792,709 | |||||
Total investments at fair value | 841,622,115 | 664,373,189 | |||||
Cash and cash equivalents | 84,012,141 | 133,304,346 | |||||
Interest and fees receivable | 4,491,235 | 5,255,760 | |||||
Prepaid expenses and other current assets | 643,796 | 831,544 | |||||
Deferred financing fees | 10,639,376 | 11,063,716 | |||||
Property and equipment, net | 97,757 | 60,525 | |||||
Total assets | $ | 941,506,420 | $ | 814,889,080 | |||
Liabilities: | |||||||
Accounts payable and accrued liabilities | $ | 3,800,689 | $ | 7,493,928 | |||
Interest payable | 1,089,844 | 3,017,645 | |||||
Taxes payable | 428,033 | 1,064,544 | |||||
Deferred income taxes | 3,751,194 | 3,514,376 | |||||
Borrowings under credit facility | 10,754,616 | 11,221,246 | |||||
Notes | 149,500,000 | 149,500,000 | |||||
SBA-guaranteed debentures payable | 224,732,468 | 193,285,211 | |||||
Total liabilities | 394,056,844 | 369,096,950 | |||||
Commitments and contingencies (Note 6) | |||||||
Net Assets: | |||||||
Common stock, $0.001 par value per share (150,000,000 shares authorized, 32,906,347 and 27,697,483 shares issued and outstanding as of September 30, 2014 and December 31, 2013, respectively) | 32,906 | 27,697 | |||||
Additional paid in capital | 540,704,815 | 409,042,893 | |||||
Investment income in excess of distributions | 13,283,742 | 8,610,735 | |||||
Accumulated realized gains | 17,826,437 | 20,665,371 | |||||
Net unrealized appreciation (depreciation) | (24,398,324 | ) | 7,445,434 | ||||
Total net assets | 547,449,576 | 445,792,130 | |||||
Total liabilities and net assets | $ | 941,506,420 | $ | 814,889,080 | |||
Net asset value per share | $ | 16.64 | $ | 16.10 |
Three Months Ended | Three Months Ended | Nine Months Ended | Nine Months Ended | ||||||||||||
September 30, 2014 | September 30, 2013 | September 30, 2014 | September 30, 2013 | ||||||||||||
Investment income: | |||||||||||||||
Loan interest, fee and dividend income: | |||||||||||||||
Non-Control / Non-Affiliate investments | $ | 17,482,268 | $ | 19,933,576 | $ | 51,282,601 | $ | 56,817,499 | |||||||
Affiliate investments | 3,436,198 | 2,710,338 | 9,812,581 | 8,919,819 | |||||||||||
Control investments | 139,742 | 50,334 | 928,937 | 145,899 | |||||||||||
Total loan interest, fee and dividend income | 21,058,208 | 22,694,248 | 62,024,119 | 65,883,217 | |||||||||||
Payment-in-kind interest income: | |||||||||||||||
Non-Control / Non-Affiliate investments | 3,087,464 | 3,591,182 | 9,489,524 | 10,076,655 | |||||||||||
Affiliate investments | 668,201 | 942,609 | 2,135,374 | 2,882,719 | |||||||||||
Control investments | — | 6,058 | 12,071 | 17,886 | |||||||||||
Total payment-in-kind interest income | 3,755,665 | 4,539,849 | 11,636,969 | 12,977,260 | |||||||||||
Interest income from cash and cash equivalent investments | 61,897 | 81,071 | 193,393 | 176,774 | |||||||||||
Total investment income | 24,875,770 | 27,315,168 | 73,854,481 | 79,037,251 | |||||||||||
Operating expenses: | |||||||||||||||
Interest and other financing fees | 5,292,967 | 4,997,620 | 15,591,022 | 15,098,655 | |||||||||||
General and administrative expenses | 4,166,165 | 5,537,980 | 14,345,132 | 15,653,640 | |||||||||||
Total operating expenses | 9,459,132 | 10,535,600 | 29,936,154 | 30,752,295 | |||||||||||
Net investment income | 15,416,638 | 16,779,568 | 43,918,327 | 48,284,956 | |||||||||||
Realized and unrealized gains (losses) on investments and foreign currency borrowings: | |||||||||||||||
Net realized gains (losses): | |||||||||||||||
Non-Control / Non-Affiliate investments | 5,231,548 | 1,006,339 | 16,966,024 | 4,013,789 | |||||||||||
Affiliate investments | (200,000 | ) | 17,811 | 28,252 | 4,613,810 | ||||||||||
Control investments | — | — | (208,553 | ) | (2,290,919 | ) | |||||||||
Net realized gains (losses) | 5,031,548 | 1,024,150 | 16,785,723 | 6,336,680 | |||||||||||
Net unrealized appreciation (depreciation): | |||||||||||||||
Investments | (29,639,438 | ) | 4,892,807 | (32,310,388 | ) | 8,776,148 | |||||||||
Foreign currency borrowings | 501,364 | (11,274 | ) | 466,630 | (11,274 | ) | |||||||||
Net unrealized appreciation (depreciation) | (29,138,074 | ) | 4,881,533 | (31,843,758 | ) | 8,764,874 | |||||||||
Net realized and unrealized gains (losses) on investments and foreign currency borrowings | (24,106,526 | ) | 5,905,683 | (15,058,035 | ) | 15,101,554 | |||||||||
Loss on extinguishment of debt | — | — | — | (412,673 | ) | ||||||||||
Benefit (provision) for taxes | (122,439 | ) | 486,413 | (975,782 | ) | 466,110 | |||||||||
Net increase (decrease) in net assets resulting from operations | $ | (8,812,327 | ) | $ | 23,171,664 | $ | 27,884,510 | $ | 63,439,947 | ||||||
Net investment income per share—basic and diluted | $ | 0.51 | $ | 0.61 | $ | 1.53 | $ | 1.75 | |||||||
Net increase (decrease) in net assets resulting from operations per share—basic and diluted | $ | (0.29 | ) | $ | 0.84 | $ | 0.97 | $ | 2.30 | ||||||
Dividends/distributions paid per share: | |||||||||||||||
Regular quarterly dividends/distributions | $ | 0.54 | $ | 0.54 | $ | 1.62 | $ | 1.62 | |||||||
Supplemental dividends/distributions | 0.05 | — | 0.35 | — | |||||||||||
Total dividends/distributions | $ | 0.59 | $ | 0.54 | $ | 1.97 | $ | 1.62 | |||||||
Weighted average number of shares outstanding—basic and diluted | 30,412,036 | 27,619,464 | 28,718,753 | 27,541,442 |
Common Stock | Additional Paid In Capital | Investment Income in Excess of Distributions | Accumulated Realized Gains on Investments | Net Unrealized Appreciation(Depreciation) | Total Net Assets | |||||||||||||||||||||
Number of Shares | Par Value | |||||||||||||||||||||||||
Balance, December 31, 2012 | 27,284,798 | $ | 27,285 | $ | 403,322,097 | $ | 6,783,161 | $ | 1,972,940 | $ | 5,229,761 | $ | 417,335,244 | |||||||||||||
Net investment income | — | — | — | 48,284,956 | — | — | 48,284,956 | |||||||||||||||||||
Stock-based compensation | — | — | 2,817,267 | — | — | — | 2,817,267 | |||||||||||||||||||
Realized gain (loss) on investments | — | — | — | — | 6,336,680 | (3,613,847 | ) | 2,722,833 | ||||||||||||||||||
Net unrealized gains on investments / foreign currency | — | — | — | — | — | 12,378,721 | 12,378,721 | |||||||||||||||||||
Loss on extinguishment of debt | — | — | — | (412,673 | ) | — | — | (412,673 | ) | |||||||||||||||||
Tax benefit | — | — | — | 466,110 | — | — | 466,110 | |||||||||||||||||||
Dividends / distributions | 84,058 | 84 | 2,362,204 | (44,689,241 | ) | — | — | (42,326,953 | ) | |||||||||||||||||
Issuance of restricted stock | 309,430 | 309 | (309 | ) | — | — | — | — | ||||||||||||||||||
Balance, September 30, 2013 | 27,678,286 | $ | 27,678 | $ | 408,501,259 | $ | 10,432,313 | $ | 8,309,620 | $ | 13,994,635 | $ | 441,265,505 |
Common Stock | Additional Paid In Capital | Investment Income in Excess of Distributions | Accumulated Realized Gains on Investments | Net Unrealized Appreciation (Depreciation) | Total Net Assets | |||||||||||||||||||||
Number of Shares | Par Value | |||||||||||||||||||||||||
Balance, December 31, 2013 | 27,697,483 | $ | 27,697 | $ | 409,042,893 | $ | 8,610,735 | $ | 20,665,371 | $ | 7,445,434 | $ | 445,792,130 | |||||||||||||
Net investment income | — | — | — | 43,918,327 | — | — | 43,918,327 | |||||||||||||||||||
Stock-based compensation | — | — | 4,334,437 | — | — | — | 4,334,437 | |||||||||||||||||||
Realized gain (loss) on investments | — | — | — | — | 16,785,723 | (15,977,182 | ) | 808,541 | ||||||||||||||||||
Net unrealized loss on investments / foreign currency | — | — | — | — | — | (15,866,576 | ) | (15,866,576 | ) | |||||||||||||||||
Provision for taxes | — | — | — | (975,782 | ) | — | — | (975,782 | ) | |||||||||||||||||
Dividends / distributions | 80,002 | 80 | 2,119,268 | (38,269,538 | ) | (19,624,657 | ) | — | (55,774,847 | ) | ||||||||||||||||
Public offering of common stock | 4,945,000 | 4,945 | 127,816,432 | — | — | — | 127,821,377 | |||||||||||||||||||
Issuance of restricted stock | 282,630 | 282 | (282 | ) | — | — | — | — | ||||||||||||||||||
Common stock withheld for payroll taxes upon vesting of restricted stock | (98,768 | ) | (98 | ) | (2,607,933 | ) | — | — | — | (2,608,031 | ) | |||||||||||||||
Balance, September 30, 2014 | 32,906,347 | $ | 32,906 | $ | 540,704,815 | $ | 13,283,742 | $ | 17,826,437 | $ | (24,398,324 | ) | $ | 547,449,576 |
Nine Months Ended | Nine Months Ended | ||||||
September 30, 2014 | September 30, 2013 | ||||||
Cash flows from operating activities: | |||||||
Net increase in net assets resulting from operations | $ | 27,884,510 | $ | 63,439,947 | |||
Adjustments to reconcile net increase in net assets resulting from operations to net cash used in operating activities: | |||||||
Purchases of portfolio investments | (345,617,501 | ) | (112,405,369 | ) | |||
Repayments received/sales of portfolio investments | 154,891,195 | 210,113,002 | |||||
Loan origination and other fees received | 5,669,609 | 1,221,431 | |||||
Net realized gain on investments | (16,785,723 | ) | (6,336,680 | ) | |||
Net unrealized depreciation (appreciation) on investments | 32,073,570 | (10,213,928 | ) | ||||
Net unrealized depreciation (appreciation) on foreign currency borrowings | (466,630 | ) | 11,274 | ||||
Deferred income taxes | 236,818 | 1,437,780 | |||||
Payment-in-kind interest accrued, net of payments received | (3,965,352 | ) | (1,459,624 | ) | |||
Amortization of deferred financing fees | 1,225,815 | 1,154,021 | |||||
Loss on extinguishment of debt | — | 412,673 | |||||
Accretion of loan origination and other fees | (2,705,077 | ) | (3,447,435 | ) | |||
Accretion of loan discounts | (809,647 | ) | (1,144,867 | ) | |||
Accretion of discount on SBA-guaranteed debentures payable | 137,257 | 134,310 | |||||
Depreciation expense | 33,412 | 30,417 | |||||
Stock-based compensation | 4,334,437 | 2,817,267 | |||||
Changes in operating assets and liabilities: | |||||||
Interest and fees receivable | 764,525 | (1,235,105 | ) | ||||
Prepaid expenses and other current assets | 187,748 | (382,869 | ) | ||||
Accounts payable and accrued liabilities | (3,693,239 | ) | 723,138 | ||||
Interest payable | (1,927,801 | ) | (2,063,979 | ) | |||
Taxes payable | (636,511 | ) | (3,170,740 | ) | |||
Net cash provided by (used in) operating activities | (149,168,585 | ) | 139,634,664 | ||||
Cash flows from investing activities: | |||||||
Purchases of property and equipment | (70,644 | ) | (29,056 | ) | |||
Net cash used in investing activities | (70,644 | ) | (29,056 | ) | |||
Cash flows from financing activities: | |||||||
Borrowings under SBA-guaranteed debentures payable | 31,310,000 | — | |||||
Repayments of SBA-guaranteed debentures payable | — | (20,500,000 | ) | ||||
Borrowings under credit facility | 20,000,000 | 11,625,654 | |||||
Repayments of credit facility | (20,000,000 | ) | — | ||||
Financing fees paid | (801,475 | ) | (684,294 | ) | |||
Proceeds from public stock offerings, net of expenses | 127,821,377 | — | |||||
Common stock withheld for payroll taxes upon vesting of restricted stock | (2,608,031 | ) | — | ||||
Cash dividends/distributions paid | (55,774,847 | ) | (42,326,953 | ) | |||
Net cash provided by (used in) financing activities | 99,947,024 | (51,885,593 | ) | ||||
Net increase (decrease) in cash and cash equivalents | (49,292,205 | ) | 87,720,015 | ||||
Cash and cash equivalents, beginning of period | 133,304,346 | 72,300,423 | |||||
Cash and cash equivalents, end of period | $ | 84,012,141 | $ | 160,020,438 | |||
Supplemental disclosure of cash flow information: | |||||||
Cash paid for interest | $ | 15,625,243 | $ | 15,374,816 | |||
Summary of non-cash financing transactions: | |||||||
Dividends/distributions paid through DRIP share issuances | $ | 2,119,348 | $ | 2,362,288 |
TRIANGLE CAPITAL CORPORATION Unaudited Consolidated Schedule of Investments September 30, 2014 | ||||||||||||||||
Portfolio Company | Industry | Type of Investment(1)(2) | Principal Amount | Cost | Fair Value(3) | |||||||||||
Non–Control / Non–Affiliate Investments: | ||||||||||||||||
Agilex Flavors & Fragrances, Inc. (3%)* | Custom Fragrance Producer | Subordinated Note (12% Cash, 1.5% PIK, Due 06/19) | $ | 12,843,054 | $ | 12,642,741 | $ | 12,642,741 | ||||||||
Common Units (1,250 units) | 1,250,000 | 2,030,000 | ||||||||||||||
12,843,054 | 13,892,741 | 14,672,741 | ||||||||||||||
AGM Automotive, LLC (5%)* | Auto Industry Interior Components Supplier | Subordinated Note (10% Cash, 3% PIK, Due 07/19) | 25,388,779 | 24,924,531 | 24,924,531 | |||||||||||
Class A Units (1,500 units) | 1,500,000 | 2,722,000 | ||||||||||||||
25,388,779 | 26,424,531 | 27,646,531 | ||||||||||||||
Applied-Cleveland Holdings, Inc. (5%)* | Oil and Gas Pipeline Infrastructure Inspection Services | Subordinated Note (10% Cash, 2% PIK, Due 06/19) | 23,000,000 | 22,664,267 | 22,664,267 | |||||||||||
Class A Units (2,129,032 units) | 2,129,032 | 2,619,000 | ||||||||||||||
23,000,000 | 24,793,299 | 25,283,267 | ||||||||||||||
Assurance Operations Corporation (0%)* | Metal Fabrication | Common Stock (517 shares) | 516,867 | 1,211,000 | ||||||||||||
516,867 | 1,211,000 | |||||||||||||||
Audio and Video Labs Holdings, Inc. (3%)* | Manufacturer and Distributor for Independent Artists and Authors | Subordinated Note (12% Cash, 2% PIK, Due 06/18) | 13,471,632 | 13,276,873 | 13,276,873 | |||||||||||
Common Stock (138 shares) | 1,300,000 | 1,702,000 | ||||||||||||||
13,471,632 | 14,576,873 | 14,978,873 | ||||||||||||||
BFN Operations LLC (3%)* | Wholesale Grower and Distributor of Container Grown Shrubs, Trees and Plants | Subordinated Note (13% Cash, 4% PIK, Due 11/17) | 18,089,153 | 17,791,902 | 17,791,902 | |||||||||||
18,089,153 | 17,791,902 | 17,791,902 | ||||||||||||||
Botanical Laboratories, Inc. (0%)* | Nutritional Supplement Manufacturing and Distribution | Common Stock Warrants (998,680 shares) | 237,301 | 240,000 | ||||||||||||
237,301 | 240,000 | |||||||||||||||
Cafe Enterprises, Inc. (2%)* | Restaurant | Subordinated Note (12% Cash, 2% PIK, Due 09/19) | 12,128,579 | 11,904,533 | 11,904,533 | |||||||||||
Series C Preferred Stock (10,000 shares) | 1,000,000 | 1,000,000 | ||||||||||||||
12,128,579 | 12,904,533 | 12,904,533 | ||||||||||||||
Capital Contractors, Inc. (1%)* | Janitorial and Facilities Maintenance Services | Subordinated Notes (12% Cash, 2% PIK, Due 12/15) | 9,711,658 | 9,504,794 | 8,271,000 | |||||||||||
Common Stock Warrants (20 shares) | 492,000 | — | ||||||||||||||
9,711,658 | 9,996,794 | 8,271,000 | ||||||||||||||
Carolina Beverage Group, LLC (0%)* | Beverage Manufacturing and Packaging | Class B Units (11,974 units) | 119,735 | 510,000 | ||||||||||||
119,735 | 510,000 | |||||||||||||||
Chromaflo Technologies Parent LP (2%)* | Colorant Manufacturer and Distributor | Second Lien Term Loan (8.3% Cash, Due 06/20) | 10,000,000 | 9,954,510 | 9,954,510 | |||||||||||
Class A Units (22,561 units) | 906,604 | 2,276,000 | ||||||||||||||
10,000,000 | 10,861,114 | 12,230,510 | ||||||||||||||
Comverge, Inc. (3%)* | Provider of Intelligent Energy Management Solutions | Senior Note (12% Cash, Due 05/18) | 15,505,583 | 15,287,784 | 15,287,784 | |||||||||||
Preferred Stock (900 shares) | 900,000 | 937,000 | ||||||||||||||
Common Stock (1,000,000 shares) | 100,000 | — | ||||||||||||||
15,505,583 | 16,287,784 | 16,224,784 | ||||||||||||||
Continental Anesthesia Management, LLC (2%)* | Physicians Management Services | Subordinated Note (8% Cash, 6% PIK Due 04/15) | 10,130,411 | 10,119,749 | 10,119,749 | |||||||||||
Warrant (263 shares) | 276,100 | 115,000 | ||||||||||||||
10,130,411 | 10,395,849 | 10,234,749 | ||||||||||||||
CRS Reprocessing, LLC (3%)* | Fluid Reprocessing Services | Subordinated Note (12% Cash, 2% PIK, Due 11/15)(6) | 12,441,321 | 12,066,015 | 9,723,000 | |||||||||||
Subordinated Note (12% Cash, 2% PIK, Due 11/15)(6) | 13,720,445 | 12,705,812 | 5,236,000 | |||||||||||||
Series C Preferred Units (30 units) | 288,342 | — | ||||||||||||||
Common Unit Warrant (664 units) | 1,759,556 | — | ||||||||||||||
Series D Preferred Units (16 units) | 107,074 | — | ||||||||||||||
Series E Preferred Units (5 units) | 31,651 | — | ||||||||||||||
26,161,766 | 26,958,450 | 14,959,000 | ||||||||||||||
CWS Acquisition Corp. (3%)* | Manufacturer of Custom Windows and Sliding Doors | Subordinated Note (11% Cash, 2% PIK, Due 01/20) | 16,155,456 | 15,883,197 | 15,883,197 | |||||||||||
1,500,000 Class A Units | 1,500,000 | 1,500,000 | ||||||||||||||
16,155,456 | 17,383,197 | 17,383,197 |
TRIANGLE CAPITAL CORPORATION Unaudited Consolidated Schedule of Investments September 30, 2014 | ||||||||||||||||
Portfolio Company | Industry | Type of Investment(1)(2) | Principal Amount | Cost | Fair Value(3) | |||||||||||
Danville Materials, LLC (2%)* | Manufacturer of Dental Products | Subordinated Note (10% Cash, Due 12/18) | $ | 8,000,000 | $ | 7,860,551 | $ | 7,860,551 | ||||||||
Common Units (45,492 units) | 500,000 | 558,000 | ||||||||||||||
8,000,000 | 8,360,551 | 8,418,551 | ||||||||||||||
DataSource Incorporated (1%)* | Print Supply Chain Management Services | Subordinated Note (12% Cash, 2% PIK, Due 01/18) | 4,840,296 | 4,726,852 | 4,726,852 | |||||||||||
Common Units (47 units) | 1,000,000 | 760,000 | ||||||||||||||
4,840,296 | 5,726,852 | 5,486,852 | ||||||||||||||
DCWV Acquisition Corporation (1%)* | Arts & Crafts and Home Decor Products Designer and Supplier | Subordinated Note (12% Cash, 5% PIK, Due 09/17) (5) | 6,449,894 | 6,161,147 | 3,101,000 | |||||||||||
6,449,894 | 6,161,147 | 3,101,000 | ||||||||||||||
DialogDirect, Inc. (4%)* | Business Process Outsourcing Provider | Subordinated Note (12% Cash, 2.5% PIK, Due 06/18) | 23,964,075 | 23,638,406 | 23,638,406 | |||||||||||
23,964,075 | 23,638,406 | 23,638,406 | ||||||||||||||
DLC Acquisition, LLC (4%)* | Staffing Firm | Senior Note (10% Cash, Due 07/19) | 21,750,000 | 21,296,593 | 21,296,593 | |||||||||||
21,750,000 | 21,296,593 | 21,296,593 | ||||||||||||||
DLR Restaurants, LLC (0%)* | Restaurant | Royalty Rights | — | 15,000 | ||||||||||||
— | 15,000 | |||||||||||||||
Dyno Acquiror, Inc. (1%)* | Sewing Products and Seasonal Decorative Products Supplier | Subordinated Note (12% Cash, 2% PIK, Due 11/18) | 7,200,203 | 7,086,123 | 7,086,123 | |||||||||||
Preferred series A Units (600,000 units) | 600,000 | 302,000 | ||||||||||||||
7,200,203 | 7,686,123 | 7,388,123 | ||||||||||||||
Eckler's Holdings, Inc. (2%)* | Restoration Parts and Accessories for Classic Cars and Trucks | Subordinated Note (11% Cash, 4% PIK, Due 07/18) | 7,302,345 | 7,182,296 | 7,182,296 | |||||||||||
Common Stock (18,029 shares) | 183,562 | — | ||||||||||||||
Preferred Stock A (1,596 shares) | 1,596,126 | 1,335,000 | ||||||||||||||
7,302,345 | 8,961,984 | 8,517,296 | ||||||||||||||
Electronic Systems Protection, Inc. (0%)* | Power Protection Systems Manufacturing | Common Stock (570 shares) | 285,000 | 447,000 | ||||||||||||
285,000 | 447,000 | |||||||||||||||
Flowchem Ltd. (2%)* | Provider of Support Services to Crude Oil Pipeline Operators | Subordinated Note (11% Cash, 2% PIK, Due 06/19) | 7,877,718 | 7,738,817 | 7,738,817 | |||||||||||
Common Units (1,000,000 units) | 1,000,000 | 902,000 | ||||||||||||||
7,877,718 | 8,738,817 | 8,640,817 | ||||||||||||||
FrontStream Payments, Inc. (2%)* | Payment and Donation Management Product Service Provider | Senior Note (8% Cash, 6% PIK, Due 08/18) | 11,511,916 | 11,329,004 | 11,329,004 | |||||||||||
11,511,916 | 11,329,004 | 11,329,004 | ||||||||||||||
Frontstreet Facility Solutions, Inc. (1%)* | Retail, Restaurant and Commercial Facilities Maintenance | Subordinated Note (10% Cash, 3% PIK, Due 07/18) | 8,527,509 | 8,427,334 | 4,780,000 | |||||||||||
Convertible Preferred Units (2,500 units) | 250,000 | — | ||||||||||||||
8,527,509 | 8,677,334 | 4,780,000 | ||||||||||||||
Frozen Specialties, Inc. (2%)* | Frozen Foods Manufacturer | Subordinated Note (10% Cash, 4% PIK, Due 05/17) | 11,792,518 | 11,792,518 | 9,705,000 | |||||||||||
11,792,518 | 11,792,518 | 9,705,000 | ||||||||||||||
Garden Fresh Restaurant Holding, LLC (0%)* | Restaurant | Class A Units (5,000 units) | 500,000 | 74,000 | ||||||||||||
500,000 | 74,000 | |||||||||||||||
Grindmaster-Cecilware Corp. (1%)* | Food Services Equipment Manufacturer | Subordinated Note (12% Cash, 6% PIK, Due 04/16) | 7,414,076 | 7,400,564 | 7,400,564 | |||||||||||
7,414,076 | 7,400,564 | 7,400,564 | ||||||||||||||
GST AutoLeather, Inc. (4%)* | Supplier of Automotive Interior Leather | Subordinated Note (11% Cash, 2% PIK, Due 01/21) | 22,100,222 | 21,670,860 | 21,670,860 | |||||||||||
22,100,222 | 21,670,860 | 21,670,860 | ||||||||||||||
Hatch Chile Co., LLC (1%)* | Food Products Distributor | Subordinated Note (19% Cash, Due 11/18) | 2,992,500 | 2,968,322 | 2,968,322 | |||||||||||
Subordinated Note (14% Cash, Due 11/18) | 3,277,500 | 3,067,445 | 3,067,445 | |||||||||||||
Unit Purchase Warrant (7,817 units) | 295,800 | 643,000 | ||||||||||||||
6,270,000 | 6,331,567 | 6,678,767 | ||||||||||||||
TRIANGLE CAPITAL CORPORATION Unaudited Consolidated Schedule of Investments September 30, 2014 | ||||||||||||||||
Portfolio Company | Industry | Type of Investment(1)(2) | Principal Amount | Cost | Fair Value(3) | |||||||||||
Hickman's Egg Ranch, Inc. (3%)* | Egg Producer | Subordinated Note (12% Cash, 1% PIK, Due 06/19) | $ | 15,042,961 | $ | 14,754,126 | $ | 14,754,126 | ||||||||
15,042,961 | 14,754,126 | 14,754,126 | ||||||||||||||
HKW Capital Partners IV, L.P. (0%)*(4) | Multi-Sector Holdings | Limited Partnership Interest | 714,895 | 754,000 | ||||||||||||
714,895 | 754,000 | |||||||||||||||
Huron, Inc. (2%)* | Manufacturer for Automotive Industry | Subordinated Note (10% Cash, 3% PIK, Due 08/18) | 13,750,964 | 13,685,848 | 13,685,848 | |||||||||||
13,750,964 | 13,685,848 | 13,685,848 | ||||||||||||||
Infrastructure Corporation of America, Inc. (2%)* | Roadway Maintenance, Repair and Engineering Services | Subordinated Note (12% Cash, 2% PIK, Due 09/18) | 11,363,391 | 10,061,986 | 10,061,986 | |||||||||||
Common Stock Purchase Warrant (487,877 shares) | 2,411,000 | 2,238,000 | ||||||||||||||
11,363,391 | 12,472,986 | 12,299,986 | ||||||||||||||
Inland Pipe Rehabilitation Holding Company LLC (2%)* | Cleaning and Repair Services | Subordinated Note (13% Cash, 2.5% PIK, Due 12/16) | 8,550,095 | 8,401,566 | 8,401,566 | |||||||||||
Membership Interest Purchase Warrant (3.0%) | 853,500 | 1,003,000 | ||||||||||||||
8,550,095 | 9,255,066 | 9,404,566 | ||||||||||||||
IOS Acquisitions, Inc. (4%)* | Provider of Oil Country Tubular Goods Inspections and Repair Services | Subordinated Note (12% Cash, 3.5% PIK, Due 06/18) | 20,038,626 | 19,749,051 | 19,749,051 | |||||||||||
Common Units (7,314 Class A Units) | 1,699,847 | 1,830,000 | ||||||||||||||
20,038,626 | 21,448,898 | 21,579,051 | ||||||||||||||
Justrite Manufacturing Company, LLC (3%)* | Storage Product Developer and Supplier for Hazardous Materials | Subordinated Note (10% Cash, 2% PIK, Due 07/19) | 14,702,313 | 14,507,990 | 14,507,990 | |||||||||||
Class A Common Units (1,268 units) | 118,110 | 118,110 | ||||||||||||||
Class A Preferred Units (132 units) | 131,890 | 168,000 | ||||||||||||||
14,702,313 | 14,757,990 | 14,794,100 | ||||||||||||||
Library Systems & Services, LLC (0%)* | Municipal Business Services | Common Unit Warrants (112 units) | 58,995 | 2,673,000 | ||||||||||||
58,995 | 2,673,000 | |||||||||||||||
Magpul Industries Corp. (1%)* | Firearm Accessories Manufacturer and Distributor | Preferred Units (1,470 units) | 1,470,000 | 2,220,000 | ||||||||||||
Common Units (30,000 units) | 30,000 | 4,296,000 | ||||||||||||||
1,500,000 | 6,516,000 | |||||||||||||||
Media Storm, LLC (2%)* | Marketing Services | Subordinated Note (10% Cash, Due 08/19) | 8,000,000 | 7,924,431 | 7,924,431 | |||||||||||
Membership Units (1,216,204 units) | 1,176,957 | 1,923,000 | ||||||||||||||
8,000,000 | 9,101,388 | 9,847,431 | ||||||||||||||
Micross Solutions LLC (2%)* | Provider of Semiconductor Products and Services | Subordinated Note (12% Cash, 2% PIK, Due 06/18) | 10,997,983 | 10,878,880 | 10,878,880 | |||||||||||
Class A-2 Common Units (1,580,559 units) | 1,580,599 | 1,431,000 | ||||||||||||||
10,997,983 | 12,459,479 | 12,309,880 | ||||||||||||||
Minco Technology Labs, LLC (1%)* | Semiconductor Distribution | Subordinated Note (6.5% Cash, 3.5% PIK, Due 12/16) (6) | 6,184,671 | 5,484,627 | 3,000,000 | |||||||||||
Class A Units (5,000 HoldCo. units) | 500,000 | — | ||||||||||||||
Class A Units (3,907 OpCo. units) | 3,907 | — | ||||||||||||||
6,184,671 | 5,988,534 | 3,000,000 | ||||||||||||||
My Alarm Center, LLC (0%)* | Security Company | Preferred Units (2,000,000 units) | 2,000,000 | 1,918,000 | ||||||||||||
2,000,000 | 1,918,000 | |||||||||||||||
On Event Services, LLC (2%)* | Equipment Rentals to Conference Venues and Live Events | Subordinated Note (10% Cash, 2% PIK, Due 01/19) | 9,895,720 | 9,724,199 | 9,724,199 | |||||||||||
9,895,720 | 9,724,199 | 9,724,199 | ||||||||||||||
PCX Aerostructures, LLC (4%)* | Aerospace Component Manufacturer | Subordinated Note (11% Cash, 3% PIK, Due 04/19) | 19,277,164 | 18,924,761 | 18,924,761 | |||||||||||
Series A Preferred Stock (3,980 shares) | 3,980,000 | 3,980,000 | ||||||||||||||
Class A Common Stock (80,000 shares) | 20,000 | 20,000 | ||||||||||||||
19,277,164 | 22,924,761 | 22,924,761 | ||||||||||||||
Performance Health & Wellness Holdings, Inc. (2%)* | Designer and Manufacturer of Rehabilitation and Wellness Products | Subordinated Note (12% Cash, 1% PIK, Due 04/19) | 6,718,681 | 6,568,660 | 6,631,000 | |||||||||||
Class A Limited Partnership Units (15,000 units) | 1,500,000 | 2,253,000 | ||||||||||||||
6,718,681 | 8,068,660 | 8,884,000 | ||||||||||||||
TRIANGLE CAPITAL CORPORATION Unaudited Consolidated Schedule of Investments September 30, 2014 | ||||||||||||||||
Portfolio Company | Industry | Type of Investment(1)(2) | Principal Amount | Cost | Fair Value(3) | |||||||||||
PetroLiance, LLC (3%)* | Lubricant, Fuel and Ancillary Products Distributor | Subordinated Note (12% Cash, 0.5% PIK, Due 08/19) | $ | 12,045,575 | $ | 11,829,867 | $ | 11,829,867 | ||||||||
Class A Units (1,142,857 Units) | 1,200,000 | 2,117,000 | ||||||||||||||
12,045,575 | 13,029,867 | 13,946,867 | ||||||||||||||
PowerDirect Marketing, LLC (1%)* | Marketing Services | Subordinated Note (13% Cash, 2% PIK, Due 12/16)(6) | 7,254,113 | 6,613,149 | 3,456,000 | |||||||||||
Common Unit Purchase Warrants | 590,200 | — | ||||||||||||||
7,254,113 | 7,203,349 | 3,456,000 | ||||||||||||||
Sheplers, Inc. (2%)* | Western Apparel Retailer | Subordinated Note (13.2% Cash, Due 12/16) | 8,750,000 | 8,634,079 | 8,634,079 | |||||||||||
Subordinated Note (10% Cash, 7% PIK, Due 12/17) | 4,545,735 | 4,507,387 | 4,507,387 | |||||||||||||
13,295,735 | 13,141,466 | 13,141,466 | ||||||||||||||
SPC Partners V, LP (0%)*(4) | Multi-Sector Holdings | 0.7% Limited Partnership Interest | 742,036 | 742,036 | ||||||||||||
742,036 | 742,036 | |||||||||||||||
Specialized Desanders, Inc. (4%)* (4) | Sand and Particulate Removal Equipment Provider for Oil and Gas Companies | Subordinated Note (12% Cash, 2% PIK, Due 03/20) | 16,110,043 | 15,864,548 | 14,990,211 | |||||||||||
LLP Units (2,000,000 units) | 1,937,421 | 6,413,000 | ||||||||||||||
16,110,043 | 17,801,969 | 21,403,211 | ||||||||||||||
Stella Environmental Services, LLC (0%)* | Waste Transfer Stations | Common Stock Purchase Warrants (2,500 shares) | 20,000 | 949,000 | ||||||||||||
20,000 | 949,000 | |||||||||||||||
TACH Holdings, Inc. (f/k/a Trinity Consultants Holdings, Inc.) (3%)* | Air Quality Consulting Services | Subordinated Note (10% Cash, 3% PIK, Due 08/20) | 15,058,750 | 14,931,328 | 14,931,328 | |||||||||||
Series A1 Preferred Stock (10,000 units) | — | 101,000 | ||||||||||||||
Common Stock (50,000 units) | 50,000 | 911,000 | ||||||||||||||
15,058,750 | 14,981,328 | 15,943,328 | ||||||||||||||
Tate's Bake Shop (2%)* | Producer of Gourmet Cookies and Other Baked Goods | Subordinated Note (10% Cash, 3% PIK, Due 02/20) | 10,028,333 | 9,828,333 | 9,828,333 | |||||||||||
Limited Partnership Investment | 999,000 | 999,000 | ||||||||||||||
10,028,333 | 10,827,333 | 10,827,333 | ||||||||||||||
TCFI Merlin LLC (3%)* | Specialty Staffing Service Provider | Senior Note (10% Cash, 1% PIK, Due 09./19) | 15,003,750 | 14,703,750 | 14,703,750 | |||||||||||
Limited Partnership Units (500,000 units) | 500,000 | 500,000 | ||||||||||||||
15,003,750 | 15,203,750 | 15,203,750 | ||||||||||||||
The Cook & Boardman Group, LLC (3%)* | Specialty Distributor of Doors and Related Products | Subordinated Note (10% Cash, 2.5% PIK, Due 03/20) | 14,018,472 | 13,738,472 | 13,738,472 | |||||||||||
Class A Units (1,400,000 units) | 1,400,000 | 1,400,000 | ||||||||||||||
14,018,472 | 15,138,472 | 15,138,472 | ||||||||||||||
The Krystal Company (1%)* | Restaurant | Class A Units of Limited Partnership (2,000 units) | 638,260 | 3,119,000 | ||||||||||||
638,260 | 3,119,000 | |||||||||||||||
Tomich Brothers, LLC (0%)* | Squid and Wetfish Processor and Distributor | Subordinated Note (9.5% Cash, 5.5% PIK, Due 04/16) (6) | 13,206,424 | 12,807,836 | 2,713,000 | |||||||||||
13,206,424 | 12,807,836 | 2,713,000 | ||||||||||||||
Top Knobs USA, Inc. (0%)* | Hardware Designer and Distributor | Common Stock (26,593 shares) | 402,828 | 1,647,000 | ||||||||||||
402,828 | 1,647,000 | |||||||||||||||
United Biologics, LLC (2%)* | Allergy Immunotherapy | Subordinated Note (12% Cash, 2% PIK, Due 03/17) | 12,805,264 | 12,167,196 | 12,167,196 | |||||||||||
Class A Common Stock (177,935 shares) | 1,999,989 | 820,000 | ||||||||||||||
Class A-1 Common Stock (18,818 shares) | 137,324 | 137,000 | ||||||||||||||
Class A-1 Common Kicker Stock (14,114 shares) | — | — | ||||||||||||||
Class A & Class B Unit Purchase Warrants | 838,117 | 195,000 | ||||||||||||||
12,805,264 | 15,142,626 | 13,319,196 | ||||||||||||||
United Retirement Plan Consultants, Inc. (0%)* | Retirement Plan Administrator | Preferred A Units (90,000 units) | 900,000 | 1,050,000 | ||||||||||||
Common Units (10,000 units) | 100,000 |