10-Q: Quarterly report pursuant to Section 13 or 15(d)
Published on August 6, 2014
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, 2014
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 6, 2014 was 27,939,795.
TRIANGLE CAPITAL CORPORATION
TABLE OF CONTENTS
QUARTERLY REPORT ON FORM 10-Q
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. |
||
2
PART I – FINANCIAL INFORMATION
Item 1. Financial Statements.
TRIANGLE CAPITAL CORPORATION
Consolidated Balance Sheets
June 30, 2014 |
December 31, 2013 |
||||||
(Unaudited) |
|||||||
Assets: |
|||||||
Investments at fair value: |
|||||||
Non-Control / Non-Affiliate investments (cost of $600,208,555 and $528,021,069 at June 30, 2014 and December 31, 2013, respectively) |
$ |
612,117,936 |
$ |
546,043,946 |
|||
Affiliate investments (cost of $109,139,313 and $107,418,051 at June 30, 2014 and December 31, 2013, respectively) |
110,910,292 |
107,536,534 |
|||||
Control investments (cost of $18,241,876 and $18,378,665 at June 30, 2014 and December 31, 2013, respectively) |
13,248,925 |
10,792,709 |
|||||
Total investments at fair value |
736,277,153 |
664,373,189 |
|||||
Cash and cash equivalents |
79,593,085 |
133,304,346 |
|||||
Interest and fees receivable |
4,069,696 |
5,255,760 |
|||||
Prepaid expenses and other current assets |
592,716 |
831,544 |
|||||
Deferred financing fees |
10,263,133 |
11,063,716 |
|||||
Property and equipment, net |
75,238 |
60,525 |
|||||
Total assets |
$ |
830,871,021 |
$ |
814,889,080 |
|||
Liabilities: |
|||||||
Accounts payable and accrued liabilities |
$ |
3,216,190 |
$ |
7,493,928 |
|||
Interest payable |
3,022,415 |
3,017,645 |
|||||
Taxes payable |
408,686 |
1,064,544 |
|||||
Deferred income taxes |
4,317,331 |
3,514,376 |
|||||
Borrowings under credit facility |
31,255,980 |
11,221,246 |
|||||
Notes |
149,500,000 |
149,500,000 |
|||||
SBA-guaranteed debentures payable |
193,376,003 |
193,285,211 |
|||||
Total liabilities |
385,096,605 |
369,096,950 |
|||||
Commitments and contingencies (Note 6) |
|||||||
Net Assets: |
|||||||
Common stock, $0.001 par value per share (150,000,000 shares authorized, 27,939,795 and 27,697,483 shares issued and outstanding as of June 30, 2014 and December 31, 2013, respectively) |
27,940 |
27,697 |
|||||
Additional paid in capital |
410,823,140 |
409,042,893 |
|||||
Investment income in excess of distributions |
6,132,527 |
8,610,735 |
|||||
Accumulated realized gains |
24,051,059 |
20,665,371 |
|||||
Net unrealized appreciation |
4,739,750 |
7,445,434 |
|||||
Total net assets |
445,774,416 |
445,792,130 |
|||||
Total liabilities and net assets |
$ |
830,871,021 |
$ |
814,889,080 |
|||
Net asset value per share |
$ |
15.95 |
$ |
16.10 |
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, 2014 |
June 30, 2013 |
June 30, 2014 |
June 30, 2013 |
||||||||||||
Investment income: |
|||||||||||||||
Loan interest, fee and dividend income: |
|||||||||||||||
Non-Control / Non-Affiliate investments |
$ |
17,292,568 |
$ |
19,696,422 |
$ |
33,800,333 |
$ |
36,883,923 |
|||||||
Affiliate investments |
2,799,592 |
3,246,452 |
6,376,383 |
6,209,481 |
|||||||||||
Control investments |
643,835 |
46,194 |
789,195 |
95,565 |
|||||||||||
Total loan interest, fee and dividend income |
20,735,995 |
22,989,068 |
40,965,911 |
43,188,969 |
|||||||||||
Payment-in-kind interest income: |
|||||||||||||||
Non-Control / Non-Affiliate investments |
3,404,283 |
3,234,925 |
6,402,060 |
6,485,473 |
|||||||||||
Affiliate investments |
736,516 |
981,731 |
1,467,173 |
1,940,110 |
|||||||||||
Control investments |
6,084 |
5,961 |
12,071 |
11,828 |
|||||||||||
Total payment-in-kind interest income |
4,146,883 |
4,222,617 |
7,881,304 |
8,437,411 |
|||||||||||
Interest income from cash and cash equivalent investments |
56,888 |
44,463 |
131,496 |
95,703 |
|||||||||||
Total investment income |
24,939,766 |
27,256,148 |
48,978,711 |
51,722,083 |
|||||||||||
Operating expenses: |
|||||||||||||||
Interest and other financing fees |
5,158,543 |
4,989,523 |
10,298,055 |
10,101,035 |
|||||||||||
General and administrative expenses |
5,122,875 |
5,994,702 |
10,178,967 |
10,115,660 |
|||||||||||
Total operating expenses |
10,281,418 |
10,984,225 |
20,477,022 |
20,216,695 |
|||||||||||
Net investment income |
14,658,348 |
16,271,923 |
28,501,689 |
31,505,388 |
|||||||||||
Realized and unrealized gains (losses) on investments and foreign currency borrowings: |
|||||||||||||||
Net realized gains (losses): |
|||||||||||||||
Non-Control / Non-Affiliate investments |
11,462,275 |
2,428,668 |
11,734,476 |
3,007,450 |
|||||||||||
Affiliate investments |
228,252 |
3,321,999 |
228,252 |
4,595,999 |
|||||||||||
Control investments |
— |
(2,290,919 |
) |
(208,553 |
) |
(2,290,919 |
) |
||||||||
Net realized gains (losses) |
11,690,527 |
3,459,748 |
11,754,175 |
5,312,530 |
|||||||||||
Net unrealized appreciation (depreciation): |
|||||||||||||||
Investments |
(1,172,480 |
) |
2,116,796 |
(2,670,950 |
) |
3,883,341 |
|||||||||
Foreign currency borrowings |
(395,269 |
) |
— |
(34,734 |
) |
— |
|||||||||
Net unrealized appreciation (depreciation) |
(1,567,749 |
) |
2,116,796 |
(2,705,684 |
) |
3,883,341 |
|||||||||
Net realized and unrealized gains (losses) on investments and foreign currency borrowings |
10,122,778 |
5,576,544 |
9,048,491 |
9,195,871 |
|||||||||||
Loss on extinguishment of debt |
— |
— |
— |
(412,673 |
) |
||||||||||
Provision for taxes |
(586,788 |
) |
— |
(853,343 |
) |
(20,303 |
) |
||||||||
Net increase in net assets resulting from operations |
$ |
24,194,338 |
$ |
21,848,467 |
$ |
36,696,837 |
$ |
40,268,283 |
|||||||
Net investment income per share—basic and diluted |
$ |
0.53 |
$ |
0.59 |
$ |
1.02 |
$ |
1.15 |
|||||||
Net increase in net assets resulting from operations per share—basic and diluted |
$ |
0.87 |
$ |
0.79 |
$ |
1.32 |
$ |
1.46 |
|||||||
Dividends per share |
$ |
0.54 |
$ |
0.54 |
$ |
1.08 |
$ |
1.08 |
|||||||
Capital gain distributions per share |
$ |
0.15 |
$ |
— |
$ |
0.30 |
$ |
— |
|||||||
Weighted average number of shares outstanding—basic and diluted |
27,910,468 |
27,569,524 |
27,857,788 |
27,501,407 |
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 |
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 |
— |
— |
— |
31,505,388 |
— |
— |
31,505,388 |
|||||||||||||||||||
Stock-based compensation |
— |
— |
1,675,896 |
— |
— |
— |
1,675,896 |
|||||||||||||||||||
Realized gain (loss) on investments |
— |
— |
— |
— |
5,312,530 |
(3,863,315 |
) |
1,449,215 |
||||||||||||||||||
Net unrealized gains on investments / foreign currency |
— |
— |
— |
— |
— |
7,746,656 |
7,746,656 |
|||||||||||||||||||
Loss on extinguishment of debt |
— |
— |
— |
(412,673 |
) |
— |
— |
(412,673 |
) |
|||||||||||||||||
Provision for taxes |
— |
— |
— |
(20,303 |
) |
— |
— |
(20,303 |
) |
|||||||||||||||||
Dividends / distributions |
57,042 |
57 |
1,570,104 |
(29,757,555 |
) |
— |
— |
(28,187,394 |
) |
|||||||||||||||||
Issuance of restricted stock |
258,410 |
258 |
(258 |
) |
— |
— |
— |
— |
||||||||||||||||||
Balance, June 30, 2013 |
27,600,250 |
$ |
27,600 |
$ |
406,567,839 |
$ |
8,098,018 |
$ |
7,285,470 |
$ |
9,113,102 |
$ |
431,092,029 |
Common Stock |
Additional
Paid In
Capital
|
Investment
Income
in Excess of Distributions
|
Accumulated
Realized
Gains on Investments |
Net
Unrealized
Appreciation |
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 loss 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 |
See accompanying notes.
5
TRIANGLE CAPITAL CORPORATION
Unaudited Consolidated Statements of Cash Flows
Six Months Ended |
Six Months Ended |
||||||
June 30, 2014 |
June 30, 2013 |
||||||
Cash flows from operating activities: |
|||||||
Net increase in net assets resulting from operations |
$ |
36,696,837 |
$ |
40,268,283 |
|||
Adjustments to reconcile net increase in net assets resulting from operations to net cash used in operating activities: |
|||||||
Purchases of portfolio investments |
(164,840,342 |
) |
(37,112,821 |
) |
|||
Repayments received/sales of portfolio investments |
105,026,498 |
111,695,347 |
|||||
Loan origination and other fees received |
2,838,426 |
621,440 |
|||||
Net realized gain on investments |
(11,754,175 |
) |
(5,312,530 |
) |
|||
Net unrealized depreciation (appreciation) on investments |
1,867,995 |
(4,914,099 |
) |
||||
Net unrealized depreciation on foreign currency borrowings |
34,734 |
— |
|||||
Deferred income taxes |
802,955 |
1,030,758 |
|||||
Payment-in-kind interest accrued, net of payments received |
(2,614,188 |
) |
(5,263,335 |
) |
|||
Amortization of deferred financing fees |
800,583 |
766,221 |
|||||
Loss on extinguishment of debt |
— |
412,673 |
|||||
Accretion of loan origination and other fees |
(1,783,603 |
) |
(2,243,128 |
) |
|||
Accretion of loan discounts |
(644,575 |
) |
(765,628 |
) |
|||
Accretion of discount on SBA-guaranteed debentures payable |
90,792 |
88,843 |
|||||
Depreciation expense |
20,114 |
19,085 |
|||||
Stock-based compensation |
2,828,410 |
1,675,896 |
|||||
Changes in operating assets and liabilities: |
|||||||
Interest and fees receivable |
1,186,064 |
(1,528,838 |
) |
||||
Prepaid expenses and other current assets |
238,828 |
(106,645 |
) |
||||
Accounts payable and accrued liabilities |
(4,277,738 |
) |
(1,954,469 |
) |
|||
Interest payable |
4,770 |
(181,387 |
) |
||||
Taxes payable |
(655,858 |
) |
(2,976,193 |
) |
|||
Net cash (provided by) used in operating activities |
(34,133,473 |
) |
94,219,473 |
||||
Cash flows from investing activities: |
|||||||
Purchases of property and equipment |
(34,827 |
) |
(17,145 |
) |
|||
Net cash used in investing activities |
(34,827 |
) |
(17,145 |
) |
|||
Cash flows from financing activities: |
|||||||
Repayments of SBA-guaranteed debentures payable |
— |
(20,500,000 |
) |
||||
Borrowings under credit facility |
20,000,000 |
— |
|||||
Financing fees paid |
— |
(684,294 |
) |
||||
Common stock withheld for payroll taxes upon vesting of restricted stock |
(2,474,121 |
) |
— |
||||
Cash dividends/distributions paid |
(37,068,840 |
) |
(28,187,394 |
) |
|||
Net cash used in financing activities |
(19,542,961 |
) |
(49,371,688 |
) |
|||
Net increase (decrease) in cash and cash equivalents |
(53,711,261 |
) |
44,830,640 |
||||
Cash and cash equivalents, beginning of period |
133,304,346 |
72,300,423 |
|||||
Cash and cash equivalents, end of period |
$ |
79,593,085 |
$ |
117,131,063 |
|||
Supplemental disclosure of cash flow information: |
|||||||
Cash paid for interest |
$ |
9,008,748 |
$ |
9,084,547 |
|||
Summary of non-cash financing transactions: |
|||||||
Dividends/distributions paid through DRIP share issuances |
$ |
1,426,201 |
$ |
1,570,161 |
See accompanying notes.
6
TRIANGLE CAPITAL CORPORATION
Unaudited Consolidated Schedule of Investments
June 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) |
$ |
12,794,010 |
$ |
12,585,954 |
$ |
12,585,954 |
||||||||
Common Units (1,250 units) |
1,250,000 |
1,961,000 |
||||||||||||||
12,794,010 |
13,835,954 |
14,546,954 |
||||||||||||||
AGM Automotive, LLC (6%)* |
Auto Industry Interior Components Supplier |
Subordinated Note (10% Cash, 3% PIK, Due 07/19) |
25,195,122 |
24,711,960 |
24,711,960 |
|||||||||||
Class A Units (1,500 units) |
1,500,000 |
1,500,000 |
||||||||||||||
25,195,122 |
26,211,960 |
26,211,960 |
||||||||||||||
Applied-Cleveland Holdings, Inc. (6%)* |
Oil and Gas Pipeline Infrastructure Inspection Services |
Subordinated Note (10% Cash, 2% PIK, Due 06/19) |
23,000,000 |
22,649,249 |
22,649,249 |
|||||||||||
Class A Preferred Units (2,129,032 units) |
2,129,032 |
2,129,032 |
||||||||||||||
23,000,000 |
24,778,281 |
24,778,281 |
||||||||||||||
Assurance Operations Corporation (0%)* |
Metal Fabrication |
Common Stock (517 shares) |
516,867 |
1,327,000 |
||||||||||||
516,867 |
1,327,000 |
|||||||||||||||
Audio and Video Labs Holdings, Inc. (3%)* |
Manufacturer and Distributor for Independent Artists and Authors |
Subordinated Note (12% Cash, 2% PIK, Due 06/18) |
13,403,010 |
13,198,084 |
13,198,084 |
|||||||||||
Common Stock (138 shares) |
1,300,000 |
1,624,000 |
||||||||||||||
13,403,010 |
14,498,084 |
14,822,084 |
||||||||||||||
BFN Operations LLC (4%)* |
Wholesale Grower and Distributor of Container Grown Shrubs, Trees and Plants |
Subordinated Note (13% Cash, 4% PIK, Due 11/17) |
17,905,495 |
17,590,096 |
17,590,096 |
|||||||||||
17,905,495 |
17,590,096 |
17,590,096 |
||||||||||||||
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. (3%)* |
Restaurant |
Subordinated Note (12% Cash, 2% PIK, Due 09/19) |
12,067,469 |
11,835,328 |
11,835,328 |
|||||||||||
Series C Preferred Stock (10,000 shares) |
1,000,000 |
1,000,000 |
||||||||||||||
12,067,469 |
12,835,328 |
12,835,328 |
||||||||||||||
Capital Contractors, Inc. (2%)* |
Janitorial and Facilities Maintenance Services |
Subordinated Notes (12% Cash, 2% PIK, Due 12/15) |
9,662,189 |
9,417,496 |
9,417,496 |
|||||||||||
Common Stock Warrants (20 shares) |
492,000 |
200,000 |
||||||||||||||
9,662,189 |
9,909,496 |
9,617,496 |
||||||||||||||
Carolina Beverage Group, LLC (0%)* |
Beverage Manufacturing and Packaging |
Class B Units (11,974 units) |
119,735 |
1,547,000 |
||||||||||||
119,735 |
1,547,000 |
|||||||||||||||
Chromaflo Technologies Parent LP (3%)* |
Colorant Manufacturer and Distributor |
Second Lien Term Loan (8.3% Cash, Due 06/20) |
10,000,000 |
9,952,976 |
9,952,976 |
|||||||||||
Class A Units (22,561 units) |
— |
2,245,000 |
||||||||||||||
10,000,000 |
9,952,976 |
12,197,976 |
||||||||||||||
Comverge, Inc. (4%)* |
Provider of Intelligent Energy Management Solutions |
Senior Note (12% Cash, Due 05/18) |
15,505,583 |
15,276,415 |
15,276,415 |
|||||||||||
Preferred Stock (900 shares) |
900,000 |
987,000 |
||||||||||||||
Common Stock (1,000,000 shares) |
100,000 |
— |
||||||||||||||
15,505,583 |
16,276,415 |
16,263,415 |
||||||||||||||
Continental Anesthesia Management, LLC (2%)* |
Physicians Management Services |
Subordinated Note (8% Cash, 6% PIK Due 09/14) |
9,978,738 |
9,936,501 |
9,936,501 |
|||||||||||
Warrant (263 shares) |
276,100 |
164,000 |
||||||||||||||
9,978,738 |
10,212,601 |
10,100,501 |
||||||||||||||
CRS Reprocessing, LLC (6%)* |
Fluid Reprocessing Services |
Subordinated Note (12% Cash, 2% PIK, Due 11/15) |
12,130,464 |
12,066,015 |
12,066,015 |
|||||||||||
Subordinated Note (12% Cash, 2% PIK, Due 11/15) |
13,377,627 |
12,705,812 |
12,705,812 |
|||||||||||||
Series C Preferred Units (30 units) |
288,342 |
395,000 |
||||||||||||||
Common Unit Warrant (664 units) |
1,759,556 |
1,064,000 |
||||||||||||||
Series D Preferred Units (16 units) |
107,074 |
147,000 |
||||||||||||||
Series E Preferred Units (5 units) |
31,651 |
47,000 |
||||||||||||||
25,508,091 |
26,958,450 |
26,424,827 |
||||||||||||||
7
TRIANGLE CAPITAL CORPORATION
Unaudited Consolidated Schedule of Investments
June 30, 2014
| ||||||||||||||||
Portfolio Company |
Industry |
Type of Investment(1)(2)
|
Principal
Amount
|
Cost |
Fair
Value(3)
|
|||||||||||
Danville Materials, LLC (2%)* |
Manufacturer of Dental Products |
Senior Note (10% Cash, Due 12/18) |
$ |
8,000,000 |
$ |
7,853,531 |
$ |
7,853,531 |
||||||||
Common Units (45,492 units) |
500,000 |
500,000 |
||||||||||||||
8,000,000 |
8,353,531 |
8,353,531 |
||||||||||||||
DataSource Incorporated (1%)* |
Print Supply Chain Management Services |
Subordinated Note (12% Cash, 2% PIK, Due 01/18) |
4,815,683 |
4,695,187 |
4,695,187 |
|||||||||||
Common Units (47 units) |
1,000,000 |
910,000 |
||||||||||||||
4,815,683 |
5,695,187 |
5,605,187 |
||||||||||||||
DCWV Acquisition Corporation (1%)* |
Arts & Crafts and Home Decor Products Designer and Supplier |
Subordinated Note (12% Cash, 3% PIK, Due 09/17) (5)
|
6,336,170 |
6,155,655 |
4,279,000 |
|||||||||||
6,336,170 |
6,155,655 |
4,279,000 |
||||||||||||||
DialogueDirect, Inc. (5%)* |
Business Process Outsourcing Provider |
Subordinated Note (12% Cash, 2.5% PIK, Due 06/18) |
23,811,621 |
23,468,952 |
23,468,952 |
|||||||||||
23,811,621 |
23,468,952 |
23,468,952 |
||||||||||||||
DLR Restaurants, LLC (0%)* |
Restaurant |
Royalty Rights |
— |
— |
||||||||||||
— |
— |
|||||||||||||||
Dyno Acquiror, Inc. (2%)* |
Sewing Products and Seasonal Decorative Products Supplier |
Subordinated Note (12% Cash, 2% PIK, Due 11/18) |
7,164,322 |
7,044,747 |
7,044,747 |
|||||||||||
Preferred series A Units (600,000 units) |
600,000 |
237,000 |
||||||||||||||
7,164,322 |
7,644,747 |
7,281,747 |
||||||||||||||
Eckler's Holdings, Inc. (2%)* |
Restoration Parts and Accessories for Classic Cars and Trucks |
Subordinated Note (11% Cash, 4% PIK, Due 07/18) |
7,229,005 |
7,103,044 |
7,103,044 |
|||||||||||
Common Stock (18,029 shares) |
183,562 |
— |
||||||||||||||
Preferred Stock A (1,596 shares) |
1,596,126 |
1,449,000 |
||||||||||||||
7,229,005 |
8,882,732 |
8,552,044 |
||||||||||||||
Electronic Systems Protection, Inc. (0%)* |
Power Protection Systems Manufacturing |
Common Stock (570 shares) |
285,000 |
333,000 |
||||||||||||
285,000 |
333,000 |
|||||||||||||||
Flowchem Ltd. (2%)* |
Provider of Support Services to Crude Oil Pipeline Operators |
Subordinated Note (11% Cash, 2% PIK, Due 06/19) |
7,838,205 |
7,693,791 |
7,693,791 |
|||||||||||
Common Units (1,000,000 units) |
1,000,000 |
938,000 |
||||||||||||||
7,838,205 |
8,693,791 |
8,631,791 |
||||||||||||||
FrontStream Payments, Inc. (3%)* |
Payment and Donation Management Product Service Provider |
Senior Note (8% Cash, 6% PIK, Due 08/18) |
11,338,074 |
11,145,268 |
11,145,268 |
|||||||||||
11,338,074 |
11,145,268 |
11,145,268 |
||||||||||||||
Frontstreet Facility Solutions, Inc. (2%)* |
Retail, Restaurant and Commercial Facilities Maintenance |
Subordinated Note (10% Cash, 3% PIK, Due 07/18) |
8,462,629 |
8,356,936 |
7,108,000 |
|||||||||||
Convertible Preferred Units (2,500 units) |
250,000 |
— |
||||||||||||||
8,462,629 |
8,606,936 |
7,108,000 |
||||||||||||||
Frozen Specialties, Inc. (2%)* |
Frozen Foods Manufacturer |
Subordinated Note (10% Cash, 4% PIK, Due 05/17) (5)
|
11,673,192 |
11,673,192 |
9,456,000 |
|||||||||||
11,673,192 |
11,673,192 |
9,456,000 |
||||||||||||||
Garden Fresh Restaurant Holding, LLC (0%)* |
Restaurant |
Class A Units (5,000 units) |
500,000 |
136,000 |
||||||||||||
500,000 |
136,000 |
|||||||||||||||
Grindmaster-Cecilware Corp. (2%)* |
Food Services Equipment Manufacturer |
Subordinated Note (12% Cash, 6% PIK, Due 04/16) |
7,301,546 |
7,281,547 |
7,281,547 |
|||||||||||
7,301,546 |
7,281,547 |
7,281,547 |
||||||||||||||
Hatch Chile Co., LLC (2%)* |
Food Products Distributor |
Subordinated Note (19% Cash, Due 11/18) |
3,031,875 |
3,000,357 |
3,000,357 |
|||||||||||
Subordinated Note (14% Cash, Due 11/18) |
3,320,625 |
3,091,762 |
3,091,762 |
|||||||||||||
Unit Purchase Warrant (7,817 units) |
295,800 |
649,000 |
||||||||||||||
6,352,500 |
6,387,919 |
6,741,119 |
||||||||||||||
Hickman's Egg Ranch, Inc. (3%)* |
Egg Producer |
Subordinated Note (12% Cash, 1% PIK, Due 06/19) |
15,004,583 |
14,704,583 |
14,704,583 |
|||||||||||
15,004,583 |
14,704,583 |
14,704,583 |
||||||||||||||
HKW Capital Partners (0%)*(4)
|
Multi-Sector Holdings |
Limited Partnership Interest |
599,225 |
599,225 |
||||||||||||
599,225 |
599,225 |
|||||||||||||||
8
TRIANGLE CAPITAL CORPORATION
Unaudited Consolidated Schedule of Investments
June 30, 2014
| ||||||||||||||||
Portfolio Company |
Industry |
Type of Investment(1)(2)
|
Principal
Amount
|
Cost |
Fair
Value(3)
|
|||||||||||
Infrastructure Corporation of America, Inc. (3%)* |
Roadway Maintenance, Repair and Engineering Services |
Subordinated Note (12% Cash, 2% PIK, Due 09/18) |
$ |
11,305,509 |
$ |
9,941,421 |
$ |
9,941,421 |
||||||||
Common Stock Purchase Warrant (487,877 shares) |
2,411,000 |
2,390,000 |
||||||||||||||
11,305,509 |
12,352,421 |
12,331,421 |
||||||||||||||
Inland Pipe Rehabilitation Holding Company LLC (2%)* |
Cleaning and Repair Services |
Subordinated Note (13% Cash, 2.5% PIK, Due 12/16) |
8,495,817 |
8,333,272 |
8,333,272 |
|||||||||||
Membership Interest Purchase Warrant (3.0%) |
853,500 |
835,000 |
||||||||||||||
8,495,817 |
9,186,772 |
9,168,272 |
||||||||||||||
IOS Acquisitions, Inc. (5%)* |
Provider of Oil Country Tubular Goods Inspections and Repair Services |
Subordinated Note (12% Cash, 3.5% PIK, Due 06/18) |
19,860,456 |
19,555,765 |
19,555,765 |
|||||||||||
Common Units (7,314 Class A Units) |
1,699,847 |
1,438,000 |
||||||||||||||
19,860,456 |
21,255,612 |
20,993,765 |
||||||||||||||
Justrite Manufacturing Company, LLC (3%)* |
Storage Product Developer and Supplier for Hazardous Materials |
Subordinated Note (10% Cash, 2% PIK, Due 07/19) |
14,627,550 |
14,425,310 |
14,425,310 |
|||||||||||
Class A Common Units (1,268 units) |
118,110 |
118,110 |
||||||||||||||
Class A Preferred Units (132 units) |
131,890 |
131,890 |
||||||||||||||
14,627,550 |
14,675,310 |
14,675,310 |
||||||||||||||
Library Systems & Services, LLC (0%)* |
Municipal Business Services |
Common Unit Warrants (112 units) |
58,995 |
2,205,000 |
||||||||||||
58,995 |
2,205,000 |
|||||||||||||||
Magpul Industries Corp. (2%)* |
Firearm Accessories Manufacturer and Distributor |
Preferred Units (1,470 units) |
1,470,000 |
2,146,000 |
||||||||||||
Common Units (30,000 units) |
30,000 |
6,457,000 |
||||||||||||||
1,500,000 |
8,603,000 |
|||||||||||||||
Media Storm, LLC (2%)* |
Marketing Services |
Subordinated Note (10% Cash, Due 08/19) |
8,000,000 |
7,920,035 |
7,920,035 |
|||||||||||
Membership Units (1,216,204 units) |
1,176,957 |
1,773,000 |
||||||||||||||
8,000,000 |
9,096,992 |
9,693,035 |
||||||||||||||
Micross Solutions LLC (3%)* |
Provider of Semiconductor Products and Services |
Subordinated Note (12% Cash, 2% PIK, Due 06/18) |
10,941,962 |
10,816,642 |
10,816,642 |
|||||||||||
Class A-2 Common Units (1,580,559 units) |
1,580,599 |
1,563,000 |
||||||||||||||
10,941,962 |
12,397,241 |
12,379,642 |
||||||||||||||
Minco Technology Labs, LLC (1%)* |
Semiconductor Distribution |
Subordinated Note (6.5% Cash, 3.5% PIK, Due 12/16) (6)
|
6,030,557 |
5,484,627 |
3,000,000 |
|||||||||||
Class A Units (5,000 HoldCo. units) |
500,000 |
— |
||||||||||||||
Class A Units (3,907 OpCo. units) |
3,907 |
— |
||||||||||||||
6,030,557 |
5,988,534 |
3,000,000 |
||||||||||||||
My Alarm Center, LLC (0%)* |
Security Company |
Preferred Units (2,000,000 units) |
2,000,000 |
1,947,000 |
||||||||||||
2,000,000 |
1,947,000 |
|||||||||||||||
Novolyte Technologies, Inc. (0%)* |
Specialty Manufacturing |
Common Units (24,522 units) |
43,905 |
41,000 |
||||||||||||
43,905 |
41,000 |
|||||||||||||||
On Event Services, LLC (2%)* |
Equipment Rentals to Conference Venues and Live Events |
Subordinated Note (10% Cash, 2% PIK, Due 01/19) |
9,845,484 |
9,665,943 |
9,665,943 |
|||||||||||
9,845,484 |
9,665,943 |
9,665,943 |
||||||||||||||
PCX Aerostructures, LLC (5%)* |
Aerospace Component Manufacturer |
Subordinated Note (11% Cash, 3% PIK, Due 04/19) |
19,130,125 |
18,763,736 |
18,763,736 |
|||||||||||
Series A Preferred Stock (3,980 shares) |
3,980,000 |
3,980,000 |
||||||||||||||
Class A Common Stock (80,000 shares) |
20,000 |
20,000 |
||||||||||||||
19,130,125 |
22,763,736 |
22,763,736 |
||||||||||||||
Performance Health & Wellness Holdings, Inc. (2%)* |
Designer and Manufacturer of Rehabilitation and Wellness Products |
Subordinated Note (12% Cash, 1% PIK, Due 04/19) |
6,701,556 |
6,545,314 |
6,614,000 |
|||||||||||
Class A Limited Partnership Units (15,000 units) |
1,500,000 |
1,733,000 |
||||||||||||||
6,701,556 |
8,045,314 |
8,347,000 |
||||||||||||||
PetroLiance, LLC (3%)* |
Lubricant, Fuel and Ancillary Products Distributor |
Subordinated Note (12% Cash, 0.5% PIK, Due 08/19) |
12,030,196 |
11,806,150 |
11,806,150 |
|||||||||||
Class A Units (1,142,857 Units) |
1,200,000 |
2,117,000 |
||||||||||||||
12,030,196 |
13,006,150 |
13,923,150 |
||||||||||||||
9
TRIANGLE CAPITAL CORPORATION
Unaudited Consolidated Schedule of Investments
June 30, 2014
| ||||||||||||||||
Portfolio Company |
Industry |
Type of Investment(1)(2)
|
Principal
Amount
|
Cost |
Fair
Value(3)
|
|||||||||||
PowerDirect Marketing, LLC (1%)* |
Marketing Services |
Subordinated Note (13% Cash, 2% PIK, Due 12/16) |
$ |
6,982,947 |
$ |
6,613,149 |
$ |
5,990,000 |
||||||||
Common Unit Purchase Warrants |
590,200 |
— |
||||||||||||||
6,982,947 |
7,203,349 |
5,990,000 |
||||||||||||||
Sheplers, Inc. (3%)* |
Western Apparel Retailer |
Subordinated Note (13.2% Cash, Due 12/16) |
8,750,000 |
8,623,153 |
8,623,153 |
|||||||||||
Subordinated Note (10% Cash, 7% PIK, Due 12/17) |
4,467,763 |
4,425,657 |
4,425,657 |
|||||||||||||
13,217,763 |
13,048,810 |
13,048,810 |
||||||||||||||
Snacks Holding Corporation (3%)* |
Trail Mixes and Nut Manufacturer and Marketer |
Subordinated Note (12% Cash, 1% PIK, Due 05/20) |
5,056,219 |
5,022,373 |
5,056,219 |
|||||||||||
Preferred A Units (22,368 units) |
1,053,897 |
3,189,000 |
||||||||||||||
Preferred B Units (10,380 units) |
25,337 |
744,000 |
||||||||||||||
Common Units (190,935 units) |
150,000 |
5,451,000 |
||||||||||||||
Common Stock Warrants (14,558 shares) |
14,558 |
591,000 |
||||||||||||||
5,056,219 |
6,266,165 |
15,031,219 |
||||||||||||||
SPC Partners V, LP (0%)*(4)
|
Multi-Sector Holdings |
0.7% Limited Partnership Interest |
545,801 |
545,801 |
||||||||||||
545,801 |
545,801 |
|||||||||||||||
Specialized Desanders, Inc. (3%)* (4)
|
Sand and Particulate Removal Equipment Provider for Oil and Gas Companies |
Subordinated Note (12% Cash, 2% PIK, Due 03/19) |
11,806,363 |
11,597,404 |
11,230,663 |
|||||||||||
Class C Common Stock (2,000,000 shares) |
1,937,421 |
2,699,000 |
||||||||||||||
11,806,363 |
13,534,825 |
13,929,663 |
||||||||||||||
Stella Environmental Services, LLC (0%)* |
Waste Transfer Stations |
Common Stock Purchase Warrants (2,500 shares) |
20,000 |
819,000 |
||||||||||||
20,000 |
819,000 |
|||||||||||||||
The Krystal Company (1%)* |
Restaurant |
Class A Units of Limited Partnership (2,000 units) |
— |
3,338,000 |
||||||||||||
— |
3,338,000 |
|||||||||||||||
Tomich Brothers, LLC (3%)* |
Squid and Wetfish Processor and Distributor |
Subordinated Note (7.5% Cash, 7.5% PIK, Due 04/16) |
12,934,198 |
12,788,869 |
11,459,000 |
|||||||||||
12,934,198 |
12,788,869 |
11,459,000 |
||||||||||||||
Top Knobs USA, Inc. (0%)* |
Hardware Designer and Distributor |
Common Stock (26,593 shares) |
402,828 |
1,557,828 |
||||||||||||
402,828 |
1,557,828 |
|||||||||||||||
Trinity Consultants Holdings, Inc. (2%)* |
Air Quality Consulting Services |
Subordinated Note (12% Cash, 2% PIK, Due 04/19) |
8,411,155 |
8,303,253 |
8,303,253 |
|||||||||||
Series A Preferred Stock (10,000 units) |
785,775 |
1,033,000 |
||||||||||||||
Common Stock (50,000 units) |
50,000 |
764,000 |
||||||||||||||
8,411,155 |
9,139,028 |
10,100,253 |
||||||||||||||
TrustHouse Services Group, Inc. (0%)* |
Food Management Services |
Class A Units (1,557 units) |
69,302 |
195,881 |
||||||||||||
Class B Units (82 units) |
3,647 |
7,089 |
||||||||||||||
Class E Units (838 units) |
101,532 |
112,555 |
||||||||||||||
174,481 |
315,525 |
|||||||||||||||
United Biologics, LLC (3%)* |
Allergy Immunotherapy |
Subordinated Note (12% Cash, 2% PIK, Due 03/17) |
12,740,037 |
12,047,932 |
12,047,932 |
|||||||||||
Class A Common Stock (177,935 shares) |
1,999,989 |
1,760,000 |
||||||||||||||
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 |
360,000 |
||||||||||||||
12,740,037 |
15,023,362 |
14,304,932 |
||||||||||||||
United Retirement Plan Consultants, Inc. (0%)* |
Retirement Plan Administrator |
Preferred A Units (90,000 units) |
900,000 |
978,000 |
||||||||||||
Common Units (10,000 units) |
100,000 |
60,000 |
||||||||||||||
1,000,000 |
1,038,000 |
|||||||||||||||