Table of Contents


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549 
__________________________________________________________
Form 10-Q
__________________________________________________________
(Mark One)
ý
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2015
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 814-00733 
__________________________________________________________
Triangle Capital Corporation
(Exact name of registrant as specified in its charter)
__________________________________________________________
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)
Registrant’s telephone number, including area code: (919) 719-4770
Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report: N/A 
__________________________________________________________
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  ý    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 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. (Check one):
Large accelerated filer
ý
Accelerated filer
¨
 
 
 
 
Non-accelerated filer
¨  (Do not check if a smaller reporting company)
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  ý
The number of shares outstanding of the registrant’s Common Stock on August 5, 2015 was 33,272,167.



TRIANGLE CAPITAL CORPORATION
TABLE OF CONTENTS
QUARTERLY REPORT ON FORM 10-Q

 
 
Page
 
PART I – FINANCIAL INFORMATION
Item 1.
 
 
 
 
 
 
 
 
 
Item 2.
Item 3.
Item 4.
 
PART II – OTHER INFORMATION
Item 1.
Item 1A.
Item 2.
Item 3.
Item 4.
Item 5.
Item 6.
 


2


PART I – FINANCIAL INFORMATION

Item 1. Financial Statements.

TRIANGLE CAPITAL CORPORATION
Consolidated Balance Sheets
 
 
June 30, 2015
 
December 31, 2014
 
(Unaudited)
 
 
Assets:
 
 
 
Investments at fair value:
 
 
 
Non-Control / Non-Affiliate investments (cost of $677,505,732 and $717,233,688 at June 30, 2015 and December 31, 2014, respectively)
$
662,866,063

 
$
693,312,886

Affiliate investments (cost of $193,995,315 and $175,182,171 at June 30, 2015 and December 31, 2014, respectively)
197,281,194

 
178,935,236

Control investments (cost of $46,406,803 and $29,636,763 at June 30, 2015 and December 31, 2014, respectively)
24,751,233

 
14,975,000

Total investments at fair value
884,898,490

 
887,223,122

Cash and cash equivalents
117,547,039

 
78,759,026

Interest and fees receivable
6,834,561

 
7,409,105

Prepaid expenses and other current assets
646,272

 
438,861

Deferred financing fees
3,682,831

 
1,230,577

Property and equipment, net
116,619

 
108,753

Total assets
$
1,013,725,812

 
$
975,169,444

Liabilities:
 
 
 
Accounts payable and accrued liabilities
$
3,417,774

 
$
7,144,673

Interest payable
3,577,430

 
3,365,237

Taxes payable
54,152

 
2,506,031

Deferred income taxes
4,117,502

 
3,363,669

Payable from unsettled transaction
16,961,500

 
—

Borrowings under credit facility
88,758,498

 
62,619,883

Notes
161,850,261

 
145,646,224

SBA-guaranteed debentures payable
220,171,914

 
219,697,098

Total liabilities
498,909,031

 
444,342,815

Commitments and contingencies (Note 7)
 
 
 
Net Assets:
 
 
 
Common stock, $0.001 par value per share (150,000,000 shares authorized, 33,272,167 and 32,950,288 shares issued and outstanding as of June 30, 2015 and December 31, 2014, respectively)
33,272

 
32,950

Additional paid in capital
544,771,957

 
542,119,994

Investment income in excess of distributions
6,138,723

 
12,926,514

Accumulated realized gains (losses)
(1,337,335
)
 
12,464,699

Net unrealized appreciation (depreciation)
(34,789,836
)
 
(36,717,528
)
Total net assets
514,816,781

 
530,826,629

Total liabilities and net assets
$
1,013,725,812

 
$
975,169,444

Net asset value per share
$
15.47

 
$
16.11


See accompanying notes.


3


TRIANGLE CAPITAL CORPORATION
Unaudited Consolidated Statements of Operations
 
Three Months
Ended
 
Three Months
Ended
 
Six Months Ended
 
Six Months Ended
 
June 30,
2015
 
June 30,
2014
 
June 30,
2015
 
June 30,
2014
Investment income:
 
 
 
 
 
 
 
Interest income:
 
 
 
 
 
 
 
Non-Control / Non-Affiliate investments
$
16,982,885

 
$
15,241,853

 
$
33,941,585

 
$
29,710,399

Affiliate investments
4,199,380

 
2,208,077

 
8,390,729

 
4,564,512

Control investments
49,481

 
43,835

 
49,481

 
87,343

Total interest income
21,231,746

 
17,493,765

 
42,381,795

 
34,362,254

Dividend income:
 
 
 
 
 
 
 
Non-Control / Non-Affiliate investments
45,689

 
787,689

 
1,634,394

 
1,051,616

Affiliate investments
281,369

 
207,899

 
537,622

 
1,148,070

Total dividend income
327,058

 
995,588

 
2,172,016

 
2,199,686

Fee and other income:
 
 
 
 
 
 
 
Non-Control / Non-Affiliate investments
835,092

 
1,263,026

 
4,072,438

 
3,038,318

Affiliate investments
1,500,096

 
383,616

 
1,997,053

 
663,801

Control investments
100,000

 
600,000

 
200,000

 
701,852

Total fee and other income
2,435,188

 
2,246,642

 
6,269,491

 
4,403,971

Payment-in-kind interest income:
 
 
 
 
 
 
 
Non-Control / Non-Affiliate investments
2,613,528

 
3,404,283

 
5,341,851

 
6,402,060

Affiliate investments
1,150,008

 
736,516

 
2,319,009

 
1,467,173

Control investments
—

 
6,084

 
—

 
12,071

Total payment-in-kind interest income
3,763,536

 
4,146,883

 
7,660,860

 
7,881,304

Interest income from cash and cash equivalents
67,376

 
56,888

 
120,312

 
131,496

Total investment income
27,824,904

 
24,939,766

 
58,604,474

 
48,978,711

Operating expenses:
 
 
 
 
 
 
 
Interest and other financing fees
7,325,340

 
5,158,543

 
13,757,795

 
10,298,055

General and administrative expenses
4,333,379

 
5,122,875

 
10,910,915

 
10,178,967

Total operating expenses
11,658,719

 
10,281,418

 
24,668,710

 
20,477,022

Net investment income
16,166,185

 
14,658,348

 
33,935,764

 
28,501,689

Realized and unrealized gains (losses) on investments and foreign currency borrowings:
 
 
 
 
 
 
 
Net realized gains (losses):
 
 
 
 
 
 
 
Non-Control / Non-Affiliate investments
3,178,433

 
11,462,275

 
6,415,102

 
11,734,476

Affiliate investments
238,806

 
228,252

 
266,508

 
228,252

Control investments
(20,483,644
)
 
—

 
(20,483,644
)
 
(208,553
)
Net realized gains (losses)
(17,066,405
)
 
11,690,527

 
(13,802,034
)
 
11,754,175

Net unrealized appreciation (depreciation):
 
 
 
 
 
 
 
Investments
14,782,147

 
(1,172,480
)
 
1,066,307

 
(2,670,950
)
Foreign currency borrowings
(312,322
)
 
(395,269
)
 
861,385

 
(34,734
)
Net unrealized appreciation (depreciation)
14,469,825

 
(1,567,749
)
 
1,927,692

 
(2,705,684
)
Net realized and unrealized gains (losses) on investments and foreign currency borrowings
(2,596,580
)
 
10,122,778

 
(11,874,342
)
 
9,048,491

Loss on extinguishment of debt
(1,394,017
)
 
—

 
(1,394,017
)
 
—

Provision for taxes
—

 
(586,788
)
 
(137,875
)
 
(853,343
)
Net increase in net assets resulting from operations
$
12,175,588

 
$
24,194,338

 
$
20,529,530

 
$
36,696,837

Net investment income per share—basic and diluted
$
0.49

 
$
0.53

 
$
1.02

 
$
1.02

Net increase in net assets resulting from operations per share—basic and diluted
$
0.37

 
$
0.87

 
$
0.62

 
$
1.32

Dividends/distributions per share:
 
 
 
 
 
 
 
Regular quarterly dividends/distributions
$
0.54

 
$
0.54

 
$
1.08

 
$
1.08

Supplemental dividends/distributions
0.05

 
0.15

 
0.10

 
0.30

Total dividends/distributions per share
$
0.59

 
$
0.69

 
$
1.18

 
$
1.38

Weighted average shares outstanding—basic and diluted
33,234,532

 
27,910,468

 
33,166,865

 
27,857,788


See accompanying notes.

4


TRIANGLE CAPITAL CORPORATION
Unaudited Consolidated Statements of Changes in Net Assets
 
 
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
—

 
—

 
—

 
28,501,689

 
—

 
—

 
28,501,689

Stock-based compensation
—

 
—

 
2,828,410

 
—

 
—

 
—

 
2,828,410

Realized gain (loss) on investments
—

 
—

 
—

 
—

 
11,754,175

 
(11,616,980
)
 
137,195

Net unrealized gains (losses) on investments / foreign currency
—

 
—

 
—

 
—

 
—

 
8,911,296

 
8,911,296

Provision for taxes
—

 
—

 
—

 
(853,343
)
 
—

 
—

 
(853,343
)
Dividends / distributions
53,577

 
54

 
1,426,147

 
(30,126,554
)
 
(8,368,487
)
 
—

 
(37,068,840
)
Issuance of restricted stock
282,630

 
282

 
(282
)
 
—

 
—

 
—

 
—

Common stock withheld for payroll taxes upon vesting of restricted stock
(93,895
)
 
(93
)
 
(2,474,028
)
 
—

 
—

 
—

 
(2,474,121
)
Balance, June 30, 2014
27,939,795

 
$
27,940

 
$
410,823,140

 
$
6,132,527

 
$
24,051,059

 
$
4,739,750

 
$
445,774,416

 
 
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, 2014
32,950,288

 
$
32,950

 
$
542,119,994

 
$
12,926,514

 
$
12,464,699

 
$
(36,717,528
)
 
$
530,826,629

Net investment income
—

 
—

 
—

 
33,935,764

 
—

 
—

 
33,935,764

Stock-based compensation
—

 
—

 
3,412,181

 
—

 
—

 
—

 
3,412,181

Realized gain (loss) on investments
—

 
—

 
—

 
—

 
(13,802,034
)
 
14,380,376

 
578,342

Net unrealized loss on investments / foreign currency
—

 
—

 
—

 
—

 
—

 
(12,452,684
)
 
(12,452,684
)
Loss on extinguishment of debt
—

 
—

 
—

 
(1,394,017
)
 
—

 
—

 
(1,394,017
)
Provision for taxes
—

 
—

 
—

 
(137,875
)
 
—

 
—

 
(137,875
)
Dividends / distributions
71,248

 
71

 
1,695,352

 
(39,191,663
)
 


 
—

 
(37,496,240
)
Expenses related to public offering of common stock
—

 
—

 
(54,967
)
 
—

 
—

 
—

 
(54,967
)
Issuance of restricted stock
360,840

 
361

 
(361
)
 
—

 
—

 
—

 
—

Common stock withheld for payroll taxes upon vesting of restricted stock
(110,209
)
 
(110
)
 
(2,400,242
)
 
—

 
—

 
—

 
(2,400,352
)
Balance, June 30, 2015
33,272,167

 
$
33,272

 
$
544,771,957

 
$
6,138,723

 
$
(1,337,335
)
 
$
(34,789,836
)
 
$
514,816,781


See accompanying notes.


5


TRIANGLE CAPITAL CORPORATION
Unaudited Consolidated Statements of Cash Flows
 
 
Six Months Ended
 
Six Months Ended
 
June 30, 2015
 
June 30, 2014
Cash flows from operating activities:
 
 
 
Net increase in net assets resulting from operations
$
20,529,530

 
$
36,696,837

Adjustments to reconcile net increase in net assets resulting from operations to net cash provided by (used in) operating activities:
 
 
 
Purchases of portfolio investments
(163,270,565
)
 
(164,840,342
)
Repayments received/sales of portfolio investments
154,211,535

 
105,026,498

Loan origination and other fees received
2,819,164

 
2,838,426

Net realized loss (gain) on investments
13,802,034

 
(11,754,175
)
Net unrealized depreciation (appreciation) on investments
(1,820,140
)
 
1,867,995

Net unrealized depreciation (appreciation) on foreign currency borrowings
(861,385
)
 
34,734

Deferred income taxes
753,833

 
802,955

Payment-in-kind interest accrued, net of payments received
23,501

 
(2,614,188
)
Amortization of deferred financing fees
1,107,207

 
800,583

Loss on extinguishment of debt
1,394,017

 
—

Accretion of loan origination and other fees
(3,202,668
)
 
(1,783,603
)
Accretion of loan discounts
(238,229
)
 
(644,575
)
Accretion of discount on SBA-guaranteed debentures payable
92,784

 
90,792

Depreciation expense
29,225

 
20,114

Stock-based compensation
3,412,181

 
2,828,410

Changes in operating assets and liabilities:
 
 
 
Interest and fees receivable
574,544

 
1,186,064

Prepaid expenses and other current assets
(207,411
)
 
238,828

Accounts payable and accrued liabilities
(3,726,899
)
 
(4,277,738
)
Interest payable
212,193

 
4,770

Taxes payable
(2,451,879
)
 
(655,858
)
Payable from unsettled transaction
16,961,500

 
—

Net cash provided by (used in) operating activities
40,144,072

 
(34,133,473
)
Cash flows from investing activities:
 
 
 
Purchases of property and equipment
(37,091
)
 
(34,827
)
Net cash used in investing activities
(37,091
)
 
(34,827
)
Cash flows from financing activities:
 
 
 
Borrowings under credit facility
83,000,000

 
20,000,000

Repayments of credit facility
(56,000,000
)
 
—

Proceeds from notes
83,372,640

 
—

Redemption of notes
(69,000,000
)
 
—

Financing fees paid
(2,740,049
)
 
—

Expenses related to public offering of common stock
(54,967
)
 
—

Common stock withheld for payroll taxes upon vesting of restricted stock
(2,400,352
)
 
(2,474,121
)
Cash dividends/distributions paid
(37,496,240
)
 
(37,068,840
)
Net cash used in financing activities
(1,318,968
)
 
(19,542,961
)
Net increase (decrease) in cash and cash equivalents
38,788,013

 
(53,711,261
)
Cash and cash equivalents, beginning of period
78,759,026

 
133,304,346

Cash and cash equivalents, end of period
$
117,547,039

 
$
79,593,085

Supplemental disclosure of cash flow information:
 
 
 
Cash paid for interest
$
11,673,774

 
$
9,008,748

Summary of non-cash financing transactions:
 
 
 
Dividends/distributions paid through DRIP share issuances
$
1,695,423

 
$
1,426,201


See accompanying notes.


6


TRIANGLE CAPITAL CORPORATION
Unaudited Consolidated Schedule of Investments
June 30, 2015
Portfolio Company
 
Industry
 
Type of Investment(1)(2)(7)
 
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)
 
$
12,989,699

 
$
12,814,036

 
$
12,814,036

Common Units (1,250 units)
 
 
 
1,250,000

 
2,088,000

 
 
 
12,989,699

 
14,064,036

 
14,902,036

 
 
 
 
 
 
 
 
 
 
 
AGM Automotive, LLC (0%)*
 
Auto Industry Interior Components Suppler
 
Class A Units (1,500,000 units)
 
 
 
630,134

 
1,216,000

 
 
 


 
630,134

 
1,216,000

 
 
 
 
 
 
 
 
 
 
 
All Metro Health Care Services, Inc. (3%)*(8)
 
Home Care Service Provider
 
Subordinated Note (10% Cash, 2% PIK, Due 03/20)
 
17,350,000

 
16,966,500

 
16,966,500

 
 
 
 
17,350,000

 
16,966,500

 
16,966,500

 
 
 
 
 
 
 
 
 
 
 
Applied-Cleveland Holdings, Inc. (5%)*
 
Oil and Gas Pipeline Infrastructure Inspection Services
 
Subordinated Note (10% Cash, 2% PIK, Due 06/19)
 
23,232,249

 
22,943,862

 
22,943,862

 
Class A Units (2,129,032 units)
 
 
 
2,129,032

 
1,774,000

 
 
 
23,232,249

 
25,072,894

 
24,717,862

 
 
 
 
 
 
 
 
 
 
 
Audio and Video Labs Holdings, Inc. (2%)*
 
Manufacturer and Distributor for Independent Artists and Authors
 
Subordinated Note (12% Cash, 2% PIK, Due 06/18)
 
10,401,251

 
10,272,412

 
10,272,412

Common Stock (138 shares)
 
 
 
1,300,000

 
1,590,000

 
 
 
10,401,251

 
11,572,412

 
11,862,412

 
 
 
 
 
 
 
 
 
 
 
BFN Operations LLC (2%)*
 
Wholesale Grower and Distributor of Container Grown Shrubs, Trees and Plants
 
Subordinated Note (13% Cash, 4% PIK, Due 11/20)
 
16,636,639

 
16,274,785

 
10,517,000

 
 
 
16,636,639

 
16,274,785

 
10,517,000

 
 
 
 
 
 
 
 
 
 
 
Botanical Laboratories, Inc. (0%)*
 
Nutritional Supplement Manufacturing and Distribution
 
Common Stock Warrants (998,680 shares)
 
 
 
237,301

 
384,000

 
 
 
 
 
237,301

 
384,000

 
 
 
 
 
 
 
 
 
 
 
Cafe Enterprises, Inc. (3%)*
 
Restaurant
 
Subordinated Note (12% Cash, 2% PIK, Due 09/19)
 
12,313,772

 
12,115,498

 
12,115,498

 
 
Series C Preferred Stock (10,000 shares)
 
 
 
1,000,000

 
1,000,000

 
 
 
 
12,313,772

 
13,115,498

 
13,115,498

 
 
 
 
 
 
 
 
 
 
 
Capital Contractors, Inc. (1%)*
 
Janitorial and Facilities Maintenance Services
 
Subordinated Notes (5% Cash, Due 12/16)
 
9,843,542

 
9,585,227

 
7,441,000

Series A Redeemable Preferred Stock (200 shares)
 
 
 
2,000,000

 
—

Common Stock Warrants (20 shares)
 
 
 
492,000

 
—

 
 
9,843,542

 
12,077,227

 
7,441,000

 
 
 
 
 
 
 
 
 
 
 
Carolina Beverage Group, LLC (0%)*
 
Beverage Manufacturing
and Packaging
 
Class B Units (11,974 units)
 
 
 
119,735

 
529,000

 
 
 
 
 
119,735

 
529,000

 
 
 
 
 
 
 
 
 
 
 
Chromaflo Technologies Parent LP (2%)*
 
Colorant Manufacturer and Distributor
 
Second Lien Term Loan (8.3% Cash, Due 06/20)
 
9,999,618

 
9,958,923

 
9,958,923

Class A Units (22,561 units)
 
 
 
906,604

 
2,264,000

 
 
 
9,999,618

 
10,865,527

 
12,222,923

 
 
 
 
 
 
 
 
 
 
 
Comverge, Inc. (3%)*
 
Provider of Intelligent Energy Management Solutions
 
Senior Note (12% Cash, Due 05/18)
 
15,505,583

 
15,323,979

 
15,323,979

Preferred Stock (703 shares)
 
 
 
554,458

 
493,000

Common Stock (1,000,000 shares)
 
 
 
100,000

 
—

 
 
 
15,505,583

 
15,978,437

 
15,816,979

 
 
 
 
 
 
 
 
 
 
 
Continental Anesthesia Management, LLC (2%)*
 
Physicians Management
Services
 
Subordinated Note (10% Cash, 4% PIK Due 04/16)
 
10,463,794

 
10,459,316

 
10,459,316

Warrant (263 shares)
 
 
 
276,100

 
39,000

 
 
10,463,794

 
10,735,416

 
10,498,316

 
 
 
 
 
 
 
 
 
 
 
CPower Ultimate HoldCo, LLC (0%)*
 
Demand Response Business
 
Units (345,542 units)
 
 
 
345,542

 
345,542

 
 
 
 
 
 
345,542

 
345,542

 
 
 
 
 
 
 
 
 
 
 
CWS Acquisition Corp. (3%)*
 
Manufacturer of Custom Windows and Sliding Doors
 
Subordinated Note (11% Cash, 2% PIK, Due 01/20)
 
16,401,721

 
16,159,530

 
16,401,721

1,500,000 Class A Units
 
 
 
1,500,000

 
1,500,000

 
 
16,401,721

 
17,659,530

 
17,901,721

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

7


TRIANGLE CAPITAL CORPORATION
Unaudited Consolidated Schedule of Investments
June 30, 2015
Portfolio Company
 
Industry
 
Type of Investment(1)(2)(7)
 
Principal
Amount
 
Cost
 
Fair
Value(3)
Danville Materials, LLC (2%)*
 
Manufacturer of Dental Products
 
Subordinated Note (10% Cash, Due 12/18)
 
$
8,000,000

 
$
7,882,681

 
$
7,882,681

Common Units (45,492 units)
 
 
 
500,000

 
845,000

 
 
8,000,000

 
8,382,681

 
8,727,681

 
 
 
 
 
 
 
 
 
 
 
Data Source Holdings, LLC (0%)*
 
Print Supply Chain Management Services
 
Common Units (47,503 units)
 
 
 
1,000,000

 
929,000

 
 
 


 
1,000,000

 
929,000

 
 
 
 
 
 
 
 
 
 
 
DCWV Acquisition Corporation
(1%)*
 
Arts & Crafts and Home Decor Products Designer and Supplier
 
Subordinated Note (12% Cash, 3% PIK, Due 09/17) (5)
 
6,617,147

 
6,178,633

 
3,958,000

 
Series A Preferred Equity (1,200 shares)
 
 
 
1,200,000

 
—

 
 
 
6,617,147

 
7,378,633

 
3,958,000

 
 
 
 
 
 
 
 
 
 
 
DialogDirect, Inc. (5%)*
 
Business Process Outsourcing Provider
 
Subordinated Note (12% Cash, 1.5% PIK, Due 04/20)
 
24,249,162

 
24,033,554

 
24,033,554

 
 
 
24,249,162

 
24,033,554

 
24,033,554

 
 
 
 
 
 
 
 
 
 
 
DLC Acquisition, LLC (5%)*
 
Staffing Firm
 
Senior Notes (10% Cash, Due 07/19)
 
23,850,000

 
23,454,829

 
23,454,829

 
 
 
23,850,000

 
23,454,829

 
23,454,829

 
 
 
 
 
 
 
 
 
 
 
DLR Restaurants, LLC (0%)*
 
Restaurant
 
Royalty Rights
 
 
 
—

 
—

 
 
 
 
 
—

 
—

 
 
 
 
 
 
 
 
 
 
 
Dyno Acquiror, Inc. (1%)*
 
Sewing Products and Seasonal Decorative Products Supplier
 
Subordinated Note (12% Cash, 2% PIK, Due 11/18)
 
7,308,929

 
7,212,340

 
7,212,340

 
Series A Units (600,000 units)
 
 
 
600,000

 
371,000

 
 
 
7,308,929

 
7,812,340

 
7,583,340

 
 
 
 
 
 
 
 
 
 
 
Eckler's Holdings, Inc. (1%)*
 
Restoration Parts and Accessories for Classic Cars and Trucks
 
Subordinated Note (11% Cash, 4% PIK, Due 07/18) (6)
 
8,013,380

 
7,262,454

 
6,835,000

 
Common Stock (18,029 shares)
 
 
 
183,562

 
—

 
Preferred Stock A (1,596 shares)
 
 
 
1,596,126

 
—

 
 
 
8,013,380

 
9,042,142

 
6,835,000

 
 
 
 
 
 
 
 
 
 
 
Electronic Systems Protection, Inc. (0%)*
 
Power Protection Systems Manufacturing
 
Common Stock (570 shares)
 
 
 
285,000

 
524,000

 
 
 
 
 
285,000

 
524,000

 
 
 
 
 
 
 
 
 
 
 
FCL Graphics, Inc. (0%)*
 
Commercial Printing Services
 
Senior Note (4.7% Cash, Due 09/16)
 
1,067,561

 
1,067,561

 
933,000

 
 
Senior Note (7.8% Cash, 2% PIK, Due 09/16) (5)
 
1,232,154

 
1,207,439

 
—

 
 
 
 
2,299,715

 
2,275,000

 
933,000

 
 
 
 
 
 
 
 
 
 
 
Flowchem Ltd. (2%)*
 
Provider of Support Services to Crude Oil Pipeline Operators
 
Subordinated Note (11% Cash, 2% PIK, Due 06/19)
 
7,956,475

 
7,835,038

 
7,835,038

 
Common Units (1,000,000 units)
 
 
 
914,835

 
1,719,000

 
 
 
7,956,475

 
8,749,873

 
9,554,038

 
 
 
 
 
 
 
 
 
 
 
FrontStream Payments, Inc. (2%)*
 
Payment and Donation Management Product Service Provider
 
Subordinated Note (12.5% Cash Due 12/20)
 
12,500,000

 
12,365,232

 
12,365,232

 
 
 
 
12,500,000

 
12,365,232

 
12,365,232

 
 
 
 
 
 
 
 
 
 
 
Frontstreet Facility Solutions, Inc. (1%)*
 
Retail, Restaurant and Commercial Facilities Maintenance
 
Subordinated Note (13% Cash, Due 07/18)
 
8,462,629

 
8,379,798

 
5,841,000

 
 
Series A Convertible Preferred Stock (2,500 shares)
 
 
 
250,000

 
—

 
 
Series B Convertible Preferred Stock (5,556 shares)
 
 
 
500,000

 
—

 
 
 
 
8,462,629

 
9,129,798

 
5,841,000

 
 
 
 
 
 
 
 
 
 
 
Frozen Specialties, Inc. (2%)*
 
Frozen Foods Manufacturer
 
Subordinated Note (10% Cash, 4% PIK, Due 05/17)
 
12,868,637

 
12,868,637

 
10,764,000

 
 
12,868,637

 
12,868,637

 
10,764,000

 
 
 
 
 
 
 
 
 
 
 
Garden Fresh Restaurant Holding, LLC (0%)*
 
Restaurant
 
Class A Units (5,000 units)
 
 
 
500,000

 
41,000

 
 
 
 
500,000

 
41,000

 
 
 
 
 
 
 
 
 
 
 
Gilchrist & Soames, Inc. (7%)*
 
Manufacturer of Personal Care Products
 
Split Collateral Term Loan (10% Cash, 1.5% PIK, Due 11/19)
 
35,153,443

 
34,670,061

 
34,670,061

 
 
 
 
35,153,443

 
34,670,061

 
34,670,061

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

8


TRIANGLE CAPITAL CORPORATION
Unaudited Consolidated Schedule of Investments
June 30, 2015
Portfolio Company
 
Industry
 
Type of Investment(1)(2)(7)
 
Principal
Amount
 
Cost
 
Fair
Value(3)
GST AutoLeather, Inc. (4%)*
 
Supplier of Automotive Interior Leather
 
Subordinated Note (11% Cash, 2% PIK, Due 01/21)
 
$
22,437,106

 
$
22,041,446

 
$
22,041,446

 
 
 
 
22,437,106

 
22,041,446

 
22,041,446

 
 
 
 
 
 
 
 
 
 
 
Hatch Chile Co., LLC (1%)*
 
Food Products Distributor
 
Subordinated Note (19% Cash, Due 11/18)
 
2,874,375

 
2,874,375

 
2,874,375

Subordinated Note (14% Cash, Due 11/18)
 
3,148,125

 
2,998,539

 
2,998,539

Unit Purchase Warrant (7,817 units)
 
 
 
295,800

 
618,000

 
 
6,022,500

 
6,168,714

 
6,490,914

 
 
 
 
 
 
 
 
 
 
 
Hickman's Egg Ranch, Inc. (3%)*
 
Egg Producer
 
Subordinated Note (12% Cash, Due 06/19)
 
15,049,229

 
14,795,939

 
14,795,939

 
 
15,049,229

 
14,795,939

 
14,795,939

 
 
 
 
 
 
 
 
 
 
 
HKW Capital Partners IV, L.P.
(0%)*(4)
 
Multi-Sector Holdings
 
0.6% Limited Partnership Interest
 
 
 
778,294

 
701,000

 
 
 
 
 
 
778,294

 
701,000

 
 
 
 
 
 
 
 
 
 
 
HTC Borrower, LLC (5%)*
 
Hunting and Outdoor Products
 
Subordinated Note (10% Cash, 3% PIK, Due 09/20)
 
25,237,863

 
24,875,856

 
24,875,856

 
 
 
 
25,237,863

 
24,875,856

 
24,875,856

 
 
 
 
 
 
 
 
 
 
 
Huron, Inc. (3%)*
 
Parts Supplier to Automotive Industry
 
Subordinated Note (10% Cash, 3% PIK, Due 08/18)
 
13,855,242

 
13,800,460

 
13,800,460

 
 
 
 
13,855,242

 
13,800,460

 
13,800,460

 
 
 
 
 
 
 
 
 
 
 
Inland Pipe Rehabilitation Holding Company LLC (2%)*
 
Cleaning and Repair Services
 
Subordinated Note (13% Cash, 2.5% PIK, Due 12/16)
 
8,713,217

 
8,678,040

 
8,678,040

Membership Interest Purchase Warrant (3%)
 
 
 
853,500

 
1,227,000

 
 
8,713,217

 
9,531,540

 
9,905,040

 
 
 
 
 
 
 
 
 
 
 
Justrite Manufacturing Company, LLC (3%)*
 
Storage Product Developer and Supplier for Hazardous Materials
 
Subordinated Note (10% Cash, 2% PIK, Due 07/19)
 
14,926,427

 
14,757,063

 
14,757,063

 
 
Class A Common Units (1,268 units)
 
 
 
118,110

 
265,000

 
 
Class A Preferred Units (132 units)
 
 
 
131,890

 
178,000

 
 
 
 
14,926,427

 
15,007,063

 
15,200,063

 
 
 
 
 
 
 
 
 
 
 
Magpul Industries Corp. (1%)*
 
Firearm Accessories Manufacturer and Distributor
 
Preferred Units (1,470 units)
 
 
 
1,470,000

 
2,456,000

 
Common Units (30,000 units)
 
 
 
30,000

 
1,523,000

 
 
 
 
 
1,500,000

 
3,979,000

 
 
 
 
 
 
 
 
 
 
 
Media Storm, LLC (1%)*
 
Marketing Services
 
Subordinated Note (10% Cash, Due 08/19)
 
6,545,455

 
6,513,303

 
6,513,303

Membership Units (1,216,204 units)
 
 
 
1,176,957

 
1,256,000

 
 
6,545,455

 
7,690,260

 
7,769,303

 
 
 
 
 
 
 
 
 
 
 
Micross Solutions LLC (5%)*
 
Provider of Semiconductor Products and Services
 
Subordinated Note (12% Cash, 3% PIK, Due 06/18)
 
23,341,770

 
23,171,170

 
23,171,170

Class A-2 Common Units (1,979,524 units)
 
 
 
2,019,693

 
1,683,000

 
 
23,341,770

 
25,190,863

 
24,854,170

 
 
 
 
 
 
 
 
 
 
 
My Alarm Center, LLC (0%)*
 
Security Company
 
Preferred Units (2,000,000 units)
 
 
 
2,000,000

 
1,846,000

 
 
 
 
 
2,000,000

 
1,846,000

 
 
 
 
 
 
 
 
 
 
 
Nautic Partners VII, LP (0%)*
 
Multi-Sector Holdings
 
0.4% Limited Partnership Interest
 
 
 
697,325

 
891,000

 
 
 
 
 
 
697,325

 
891,000

 
 
 
 
 
 
 
 
 
 
 
Nomacorc, LLC (4%)*
 
Synthetic Wine Cork Producer
 
Subordinated Note (10% Cash, 1.8% PIK, Due 07/21)
 
20,172,453

 
19,794,945

 
19,794,945

 
 
Limited Partnership Interest
 
 
 
2,259,339

 
2,259,339

 
 
 
 
20,172,453

 
22,054,284

 
22,054,284

 
 
 
 
 
 
 
 
 
 
 
On Event Services, LLC (4%)*
 
Equipment Rentals
 
Subordinated Note (10% Cash, 2% PIK, Due 06/20)
 
21,620,018

 
20,850,954

 
20,850,954

 
Warrant to Purchase Units (5.4%)
 
 
 
1,252,000

 
1,252,000

 
 
 
21,620,018

 
22,102,954

 
22,102,954

 
 
 
 
 
 
 
 
 
 
 
Orchid Underwriters Agency, LLC (5%)*
 
Insurance Underwriter
 
Term B Note (10% Cash, Due 11/19)
 
22,885,000

 
22,458,739

 
22,458,739

Class A Preferred Units (15,000 units)
 
 
 
1,500,000

 
1,626,000

Class A Common Units (15,000 units)
 
 
 
—

 
170,000

 
 
22,885,000

 
23,958,739

 
24,254,739

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

9


TRIANGLE CAPITAL CORPORATION
Unaudited Consolidated Schedule of Investments
June 30, 2015
Portfolio Company
 
Industry
 
Type of Investment(1)(2)(7)
 
Principal
Amount
 
Cost
 
Fair
Value(3)
Performance Health & Wellness Holdings, Inc. (1%)*
 
Rehabilitation and Wellness Products
 
Class A Limited Partnership Units (15,000 units)
 
 
 
$
1,500,000

 
$
2,622,000

 
 
 


 
1,500,000

 
2,622,000

 
 
 
 
 
 
 
 
 
 
 
PowerDirect Marketing, LLC (1%)*
 
Marketing Services
 
Subordinated Note (13% Cash, 2% PIK, Due 12/16)(6)
 
$
8,122,393

 
6,627,482

 
4,154,000

Common Unit Purchase Warrants
 
 
 
590,200

 
—

 
 
8,122,393

 
7,217,682

 
4,154,000

 
 
 
 
 
 
 
 
 
 
 
Radiant Logistics, Inc. (3%)*
 
Freight Logistics
 
Subordinated Note (12% Cash, Due 04/21)
 
15,000,000

 
14,708,714

 
14,708,714

 
 
 
 
15,000,000

 
14,708,714

 
14,708,714

 
 
 
 
 
 
 
 
 
 
 
RockYou, Inc. (0%)*
 
Mobile Game Advertising Network
 
Common Stock (67,585 shares)
 
 
 
111,000

 
111,000

 
 
 
 
 
 
111,000

 
111,000

 
 
 
 
 
 
 
 
 
 
 
SPC Partners V, LP (0%)*(4)
 
Multi-Sector Holdings
 
0.7% Limited Partnership Interest
 
 
 
745,539

 
704,000

 
 
 
 
 
 
745,539

 
704,000

 
 
 
 
 
 
 
 
 
 
 
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

 
15,895,574

 
13,544,030

Class C Capital Units (2,000,000 units)
 
 
 
1,937,421

 
4,617,000

 
 
 
16,110,043

 
17,832,995

 
18,161,030

 
 
 
 
 
 
 
 
 
 
 
TACH Holdings, Inc. (f/k/a Trinity Consultants Holdings, Inc.) (3%)*
 
Air Quality Consulting Services
 
Subordinated Note (10% Cash, 3% PIK, Due 08/20)
 
15,403,942

 
15,289,333

 
15,289,333

Series A1 Preferred Stock (10,000 units)
 
 
 
—

 
132,000

Common Stock (50,000 units)
 
 
 
50,000

 
1,189,000

 
 
 
15,403,942

 
15,339,333

 
16,610,333

 
 
 
 
 
 
 
 
 
 
 
Tate's Bake Shop (2%)*
 
Producer of Baked Goods
 
Subordinated Note (10% Cash, 3% PIK, Due 02/20)
 
10,258,212

 
10,079,524

 
10,079,524

 
 
Limited Partner Interest
 
 
 
999,000

 
1,232,000

 
 
 
 
10,258,212

 
11,078,524

 
11,311,524

 
 
 
 
 
 
 
 
 
 
 
TCFI Merlin LLC (3%)*
 
Specialty Staffing Service Provider
 
Senior Note (10% Cash, 1% PIK, Due 09/19)
 
15,117,914

 
14,854,034

 
14,854,034