þ
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the fiscal year ended December 31, 2017
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the transition period from to
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Maryland
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06-1798488
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification No.)
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3700 Glenwood Avenue, Suite 530
Raleigh, North Carolina
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27612
(Zip Code)
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(Address of principal executive offices)
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Title of Each Class
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Name of Each Exchange on Which Registered
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Common Stock, par value $0.001 per share
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The New York Stock Exchange
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6.375% Notes Due (December) 2022
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The New York Stock Exchange
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6.375% Notes Due (March) 2022
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The New York Stock Exchange
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Large accelerated filer
þ
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Accelerated filer
¨
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Non-accelerated filer
¨
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Smaller reporting company
¨
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(Do not check if a smaller reporting company)
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Emerging growth company
¨
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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
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Page
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PART I
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Item 1.
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Item 1A.
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Item 1B.
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Item 2.
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Item 3.
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Item 4.
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PART II
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Item 5.
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Item 6.
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Item 7.
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Item 7A.
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Item 8.
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Item 9.
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Item 9A.
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Item 9B.
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PART III
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Item 10.
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Item 11.
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Item 12.
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Item 13.
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Item 14.
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PART IV
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Item 15.
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•
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Utilizing Long-Standing Relationships to Source Deals.
Our senior management team maintains extensive relationships with entrepreneurs, financial sponsors, attorneys, accountants, investment bankers, commercial bankers and other non-bank providers of capital who refer prospective portfolio companies to us. These relationships historically have generated significant investment opportunities. We believe that our network of relationships will continue to produce attractive investment opportunities.
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•
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Focusing on Underserved Markets.
The lower middle market has traditionally been underserved. We believe that operating margin and growth pressures, as well as regulatory concerns, have caused financial institutions to de-emphasize services to lower middle market companies in favor of larger corporate clients and more liquid capital market transactions. We believe these dynamics have resulted in the financing market for lower middle market companies to be underserved, providing us with greater investment opportunities.
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Providing Customized Financing Solutions.
We offer a variety of financing structures and have the flexibility to structure our investments to meet the needs of our portfolio companies. Typically we invest in senior and subordinated debt securities, coupled with equity interests. We believe our ability to customize financing arrangements makes us an attractive partner to lower middle market companies.
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•
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Leveraging the Experience of Our Management Team
. Our senior management team has extensive experience advising, investing in, lending to and operating companies across changing market cycles. The members of our management team have diverse investment backgrounds, with prior experience at investment banks, commercial banks, and privately and publicly held companies in the capacity of executive officers. We believe this diverse experience provides us with an in depth understanding of the strategic, financial and operational challenges and opportunities of the lower middle market companies in which we invest. We believe this understanding allows us to select and structure better investments and to efficiently monitor and provide managerial assistance to our portfolio companies.
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Applying Rigorous Underwriting Policies and Active Portfolio Management
. Our senior management team has implemented rigorous underwriting policies that are followed in each transaction. These policies include a thorough analysis of each potential portfolio company’s competitive position, financial performance, management team operating discipline, growth potential and industry attractiveness, which we believe allows us to better assess the company’s prospects. After investing in a company, we monitor the investment closely, typically receiving monthly, quarterly and annual financial statements. We analyze and discuss in detail the company’s financial performance with management in addition to participating in regular board of directors meetings. We believe that our initial and ongoing portfolio review process allows us to monitor effectively the performance and prospects of our portfolio companies.
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•
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Taking Advantage of Low Cost Debentures Guaranteed by the SBA
. The licenses of Triangle SBIC, Triangle SBIC II and Triangle SBIC III to do business as SBICs allow them (subject to availability, SBA approval, and continued regulatory compliance) to issue fixed-rate, low interest debentures which are guaranteed by the SBA and sold in the capital markets, potentially allowing us to increase our net investment income beyond the levels achievable by other BDCs utilizing traditional leverage.
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Financing Our Investment Portfolio with Long-Term Capital.
In addition to proceeds from sales of shares of our common stock and proceeds from issuance of SBA-guaranteed debentures by our SBIC subsidiaries, we have outstanding unsecured notes with original terms of seven to ten years.
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•
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Maintaining Portfolio Diversification.
While we focus our investments in lower middle market companies, we seek to invest across various industries. We monitor our investment portfolio to ensure we have acceptable industry balance, using industry and market metrics as key indicators. By monitoring our investment portfolio for industry balance, we seek to reduce the effects of economic downturns associated with any particular industry or market sector. Notwithstanding our intent to invest across a variety of industries, we may from time to time hold securities of a single portfolio company that comprise more than 5.0% of our total assets and/or more than 10.0% of the outstanding voting securities of the portfolio
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Established Companies With Positive Cash Flow.
We seek to invest in established companies with a history of generating revenues and positive cash flows. We typically focus on companies with a history of profitability and minimum trailing twelve month EBITDA of $3.0 million. We generally do not invest in start-up companies, distressed situations, “turn-around” situations or companies that we believe have unproven business plans.
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Experienced Management Teams With Meaningful Equity Ownership.
Based on our prior investment experience, we believe that a management team with significant experience with a portfolio company or relevant industry experience and meaningful equity ownership is essential to the long-term success of the portfolio company. We believe management teams with these attributes are more likely to manage the companies in a manner that protects our debt investment and enhances the value of our equity investment.
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Strong Competitive Position.
We seek to invest in companies that have developed strong positions within their respective markets, are well positioned to capitalize on growth opportunities and compete in industries with barriers to entry. We also seek to invest in companies that exhibit a competitive advantage, which may help to protect their market position and profitability.
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Varied Customer and Supplier Bases.
We prefer to invest in companies that have varied customer and supplier bases. Companies with varied customer and supplier bases are generally better able to endure economic downturns, industry consolidation and shifting customer preferences.
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Significant Invested Capital.
We believe the existence of significant underlying equity value provides important support to investments. We look for portfolio companies that we believe have sufficient value beyond the layer of the capital structure in which we invest.
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Origination
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Due Diligence and Underwriting
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Approval
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Documentation and Closing
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Portfolio Management and Investment Monitoring
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a comprehensive financial model that we prepare based on quantitative analysis of historical financial performance, financial projections and pro forma financial ratios assuming investment;
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the competitive landscape surrounding the potential investment;
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strengths and weaknesses of the potential investment’s business strategy and industry;
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results of a broad qualitative analysis of the company’s management team, products or services, market position, market dynamics and customers and suppliers; and
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potential investment structures, certain financing ratios and investment pricing terms.
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monthly and quarterly reviews of actual financial performance versus the corresponding period of the prior year and financial projections;
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monthly and quarterly monitoring of all financial and other covenants;
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reviews of senior lender loan compliance certificates, where applicable;
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quarterly reviews of operating results and general business performance, including the preparation of a portfolio monitoring report which is distributed to members of our investment committee;
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periodic face-to-face meetings with management teams and financial sponsors of portfolio companies; and
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attendance at portfolio company board meetings through board seats or observation rights.
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financial standing of the issuer of the security;
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comparison of the business and financial plan of the issuer with actual results;
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the size of the security held;
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pending reorganization activity affecting the issuer, such as merger or debt restructuring;
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ability of the issuer to obtain needed financing;
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changes in the economy affecting the issuer;
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financial statements and reports from portfolio company senior management and ownership;
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the type of security, the security’s cost at the date of purchase and any contractual restrictions on the disposition of the security;
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information as to any transactions or offers with respect to the security and/or sales to third parties of similar securities;
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the issuer’s ability to make payments and the type of collateral;
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the current and forecasted earnings of the issuer;
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statistical ratios compared to lending standards and to other similar securities;
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pending public offering of common stock by the issuer of the security;
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special reports prepared by analysts; and
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any other factors we deem pertinent with respect to a particular investment.
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We report our investments at market value or fair value with changes in value reported through our consolidated statements of operations.
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We intend to distribute substantially all of our income to our stockholders. We generally will be required to pay income taxes only on the portion of our taxable income we do not distribute, actually or constructively, to stockholders.
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Our ability to use leverage as a means of financing our portfolio of investments is limited.
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We are required to comply with the provisions of the 1940 Act applicable to business development companies.
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pursuant to Rule 13a-14 of the Exchange Act, our Chief Executive Officer and Chief Financial Officer are required to certify the accuracy of the financial statements contained in our periodic reports;
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pursuant to Item 307 of Regulation S-K, our periodic reports are required to disclose our conclusions about the effectiveness of our disclosure controls and procedures;
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pursuant to Rule 13a-15 of the Exchange Act, our management is required to prepare a report regarding its assessment of our internal control over financial reporting, and separately, our independent registered public accounting firm audits our internal controls over financial reporting; and
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pursuant to Item 308 of Regulation S-K and Rule 13a-15 of the Exchange Act, our periodic reports must disclose whether there were significant changes in our internal control over financial reporting or in other factors that could significantly affect these controls subsequent to the date of their evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.
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a citizen or individual resident of the United States;
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a corporation, or other entity treated as a corporation for U.S. federal income tax purposes, created or organized in or under the laws of the United States or any state thereof or the District of Columbia;
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an estate, the income of which is subject to U.S. federal income taxation regardless of its source; or
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a trust if (i) a U.S. court is able to exercise primary supervision over the administration of such trust and one or more U.S. persons have the authority to control all substantial decisions of the trust or (ii) it has a valid election in place to be treated as a U.S. person.
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meet the Annual Distribution Requirement;
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qualify to be treated as a BDC or be registered as a management investment company under the 1940 Act at all times during each taxable year;
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derive in each taxable year at least 90% of our gross income from dividends, interest, payments with respect to certain securities loans, gains from the sale or other disposition of stock or other securities or foreign currencies or other income derived with respect to our business of investing in such stock, securities or currencies and net income derived from an interest in a “qualified publicly traded partnership” (as defined in the Code), or the 90% Income Test; and
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diversify our holdings so that at the end of each quarter of the taxable year:
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at least 50% of the value of our assets consists of cash, cash equivalents, U.S. Government securities, securities of other RICs, and other securities if such other securities of any one issuer do not represent more than 5% of the value of our assets or more than 10% of the outstanding voting securities of the issuer (which for these purposes includes the equity securities of a “qualified publicly traded partnership”); and
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no more than 25% of the value of our assets is invested in the securities, other than U.S. Government securities or securities of other RICs, (i) of one issuer (ii) of two or more issuers that are controlled, as determined under applicable tax rules, by us and that are engaged in the same or similar or related trades or businesses or (iii) of one or more “qualified publicly traded partnerships,” or the Diversification Tests.
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Under the provisions of the 1940 Act, we are permitted, as a BDC, to issue senior securities only in amounts such that our asset coverage, as defined in the 1940 Act, equals at least 200% after each issuance of senior securities. If the value of our assets declines, we may be unable to satisfy this test. If that happens, we may be required to sell a portion of our investments and, depending on the nature of our leverage, repay a portion of our debt at a time when such sales and/or repayments may be disadvantageous. Further we may not be permitted to declare a dividend or make any distribution to stockholders or repurchase shares until such time as we satisfy this test.
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Any amounts that we use to service our debt or make payments on preferred stock will not be available for distributions to our common stockholders.
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It is likely that any securities or other indebtedness we issue will be, and our Credit Facility and our existing notes are, governed by an indenture or other instrument containing covenants restricting our operating flexibility. Additionally, some of these securities or other indebtedness may be rated by rating agencies, and in obtaining a rating for such securities and other indebtedness, we may be required to abide by operating and investment guidelines that further restrict operating and financial flexibility.
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We and, indirectly, our stockholders, will bear the cost of issuing and servicing such securities and other indebtedness.
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Preferred stock or any convertible or exchangeable securities that we issue in the future may have rights, preferences and privileges more favorable than those of our common stock, including separate voting rights and could delay or prevent a transaction or a change in control to the detriment of the holders of our common stock.
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Assumed Return on our Portfolio
(Net of Expenses)
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(10.0
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)%
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(5.0
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)%
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0.0
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%
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5.0
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%
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10.0
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%
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Corresponding net return to stockholder(1)
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(23.9
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)%
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(14.3
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)%
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(4.8
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)%
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4.8
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%
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14.3
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%
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•
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The Annual Distribution Requirement for a RIC will be satisfied if we distribute to our stockholders on an annual basis at least 90.0% of our net ordinary income and net short-term capital gain in excess of net long-term capital loss, or "investment company taxable income" or ICTI." if any. We will be subject to a 4.0% nondeductible U.S. federal excise tax, however, to the extent that we do not satisfy certain additional minimum distribution requirements on a calendar year basis. Because we use debt financing, we are subject to certain asset coverage ratio requirements under the 1940 Act and are currently, and may in the future become, subject to certain financial covenants under loan and credit agreements that could, under certain circumstances, restrict us from making distributions necessary to satisfy the Annual Distribution Requirement. If we are unable to obtain cash from other sources, we could fail to qualify for RIC tax treatment and thus become subject to corporate-level U.S. federal income tax.
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The income source requirement will be satisfied if we obtain at least 90.0% of our income for each year from distributions, interest, gains from the sale of stock or securities or similar sources.
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The asset diversification requirement will be satisfied if we meet certain asset diversification requirements at the end of each quarter of our taxable year. To satisfy this requirement, at least 50.0% of the value of our assets must consist of cash, cash equivalents, U.S. government securities, securities of other RICs, and other acceptable securities; and no more than 25.0% of the value of our assets can be invested in the securities, other than U.S. government securities or securities of other RICs, of one issuer, of two or more issuers that are controlled, as determined under applicable Code rules, by us and that are engaged in the same or similar or related trades or businesses or of certain “qualified publicly traded partnerships.” Failure to meet these requirements may result in our having to dispose of certain investments quickly in order to prevent the loss of RIC tax treatment. Because most of our investments will be in private companies, and therefore will be relatively illiquid, any such dispositions could be made at disadvantageous prices and could result in substantial losses.
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may have limited financial resources to meet future capital needs and thus may be unable to grow or meet their obligations under their debt instruments that we hold, which may be accompanied by a deterioration in the value of any collateral and a reduction in the likelihood of us realizing any guarantees from subsidiaries or affiliates of our portfolio companies that we may have obtained in connection with our investment, as well as a corresponding decrease in the value of the equity components of our investments;
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may have shorter operating histories, narrower product lines, smaller market shares and/or more significant customer concentration than larger businesses, which tend to render them more vulnerable to competitors’ actions and market conditions, as well as general economic downturns;
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are more likely to depend on the management talents and efforts of a small group of persons; therefore, the death, disability, resignation or termination of one or more of these persons could have a material adverse impact on our portfolio company and, in turn, on us;
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generally have less predictable operating results, may be engaged in rapidly changing businesses with products subject to a substantial risk of obsolescence, and may require substantial additional capital to support their operations, finance expansion or maintain their competitive position; and
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generally have less publicly available information about their businesses, operations and financial condition. We rely on the ability of our management team and investment professionals to obtain adequate information to evaluate the potential returns from investing in these companies. If we are unable to uncover all material information about these companies, we may not make a fully informed investment decision, and may lose all or part of our investment.
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significant volatility in the market price and trading volume of securities of BDCs or other companies in our sector, which are not necessarily related to the operating performance of these companies;
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changes in regulatory policies or tax guidelines, particularly with respect to RICs, BDCs or SBICs;
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inability to obtain certain exemptive relief from the SEC;
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loss of RIC tax treatment or either of our SBIC subsidiaries’ status as an SBIC;
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changes in earnings or variations in operating results;
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changes in the value of our portfolio of investments;
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any shortfall in investment income or net investment income or any increase in losses from levels expected by investors or securities analysts;
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conversion features of subscription rights, warrants or convertible debt;
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loss of a major funding source;
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fluctuations in interest rates;
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the operating performance of companies comparable to us;
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departure of our key personnel;
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proposed, or completed, offerings of our securities, including classes other than our common stock;
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global or national credit market changes; and
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general economic trends and other external factors.
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direct obligations of, or obligations guaranteed as to principal and interest by, the United States government, which mature within 15 months from the date of the investment;
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repurchase agreements with federally insured institutions with a maturity of seven days or less (and the securities underlying the repurchase obligations must be direct obligations of, or guaranteed by, the federal government);
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certificates of deposit with a maturity of one year or less, issued by a federally insured institution;
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a deposit account in a federally insured institution that is subject to withdrawal restriction of one year or less;
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a checking account in a federally insured institution; and
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a reasonable petty cash fund.
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the time remaining to the maturity of these debt securities;
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the outstanding principal amount of debt securities with terms identical to these debt securities;
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the general economic environment;
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the supply of debt securities trading in the secondary market, if any;
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the redemption or repayment, if any, of these debt securities;
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the level, direction and volatility of market interest rates generally; and
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market rates of interest higher or lower than rates borne by the debt securities.
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High
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Low
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Fiscal Year 2016:
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First Quarter
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$20.85
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$14.91
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Second Quarter
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$21.35
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$16.00
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Third Quarter
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$20.60
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$18.56
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Fourth Quarter
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$19.95
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$16.40
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Fiscal Year 2017:
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First Quarter
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$20.35
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$18.12
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Second Quarter
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$19.15
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$17.28
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Third Quarter
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$17.83
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$12.84
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Fourth Quarter
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$14.35
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$8.91
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Date Declared
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Record
Date
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Payment
Date
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Amount
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February 24, 2016
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March 9, 2016
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March 23, 2016
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$0.54
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May 4, 2016
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June 8, 2016
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June 22, 2016
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$0.45
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August 24, 2016
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September 7, 2016
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September 21, 2016
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$0.45
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November 23, 2016
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December 7, 2016
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December 21, 2016
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$0.45
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February 22, 2017
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March 8, 2017
|
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March 22, 2017
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|
$0.45
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May 3, 2017
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June 7, 2017
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|
June 21, 2017
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|
$0.45
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August 2, 2017
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September 6, 2017
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September 20, 2017
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$0.45
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November 1, 2017
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December 6, 2017
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December 20, 2017
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$0.30
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Year Ended December 31,
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||||||||||||
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2017
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2016
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||||||||||
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Amount
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|
% of Total
|
|
Amount
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|
% of Total
|
||||||
Ordinary income
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|
$
|
1.65
|
|
|
100.0
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%
|
|
$
|
1.89
|
|
|
100.0
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%
|
Long-term capital gains
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||
Total reported on IRS Form 1099-DIV
|
|
$
|
1.65
|
|
|
100.0
|
%
|
|
$
|
1.89
|
|
|
100.0
|
%
|
Plan Category
|
|
Number of
securities to be
issued upon
exercise of outstanding
options, warrants
and rights
|
|
Weighted average
exercise price of
outstanding
options, warrants
and rights
|
|
Number of securities
remaining available
for future issuance
under equity
compensation plans
(excluding securities
reflected in column(a))
|
|
|||
|
|
(a)
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|
(b)
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|
(c)
|
|
|||
Equity compensation plans approved by security holders(1)
|
|
—
|
|
|
—
|
|
|
2,269,467
|
|
(2)
|
Equity compensation plans not approved by security holders
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Total
|
|
—
|
|
|
—
|
|
|
2,269,467
|
|
|
(1)
|
The Omnibus Plan is the only equity compensation plan currently utilized by us.
|
(2)
|
The Omnibus Plan has an aggregate of 4,000,000 shares of common stock reserved for issuance.
|
Period
|
Total number of shares purchased
|
|
Average price paid per share
|
|
Total number of
shares purchased
as part of publicly
announced plans
or programs
|
|
Maximum number
of shares that
may yet be
purchased under the plans or programs
|
|||||
October 1 through October 31, 2017
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
November 1 through November 30, 2017
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
December 1 through December 31, 2017
|
69,882
|
|
(1)
|
$
|
9.72
|
|
|
—
|
|
|
—
|
|
|
|
12/31/12
|
|
3/31/13
|
|
6/30/13
|
|
9/30/13
|
|
12/31/13
|
|
3/31/14
|
|
6/30/14
|
|
9/30/14
|
|
12/31/14
|
|||||||||
Triangle Capital Corporation
|
|
100.00
|
|
|
111.83
|
|
|
111.99
|
|
|
121.76
|
|
|
116.79
|
|
|
112.15
|
|
|
126.13
|
|
|
115.02
|
|
|
94.92
|
|
NASDAQ Composite Index
|
|
100.00
|
|
|
109.07
|
|
|
114.09
|
|
|
127.38
|
|
|
141.63
|
|
|
143.01
|
|
|
150.74
|
|
|
153.77
|
|
|
162.09
|
|
NYSE Composite Index
|
|
100.00
|
|
|
108.55
|
|
|
109.99
|
|
|
116.19
|
|
|
126.28
|
|
|
128.60
|
|
|
135.01
|
|
|
132.36
|
|
|
134.81
|
|
Triangle Capital Corporation Peer Group Index(2)
|
|
100.00
|
|
|
105.20
|
|
|
103.93
|
|
|
108.16
|
|
|
113.67
|
|
|
113.01
|
|
|
117.35
|
|
|
110.81
|
|
|
105.74
|
|
|
|
|
|
3/31/15
|
|
6/30/15
|
|
9/30/15
|
|
12/31/15
|
|
3/31/16
|
|
6/30/16
|
|
9/30/16
|
|
12/31/16
|
||||||||
Triangle Capital Corporation
|
|
|
|
109.33
|
|
|
115.15
|
|
|
83.52
|
|
|
99.64
|
|
|
110.33
|
|
|
106.41
|
|
|
110.61
|
|
|
105.48
|
|
NASDAQ Composite Index
|
|
|
|
167.90
|
|
|
171.68
|
|
|
159.69
|
|
|
173.33
|
|
|
169.25
|
|
|
168.76
|
|
|
185.06
|
|
|
187.19
|
|
NYSE Composite Index
|
|
|
|
136.35
|
|
|
136.08
|
|
|
124.19
|
|
|
129.29
|
|
|
131.01
|
|
|
135.62
|
|
|
139.52
|
|
|
144.73
|
|
Triangle Capital Corporation Peer Group Index(2)
|
|
|
|
111.95
|
|
|
107.79
|
|
|
98.12
|
|
|
102.09
|
|
|
106.70
|
|
|
110.93
|
|
|
121.82
|
|
|
127.89
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3/31/17
|
|
6/30/17
|
|
9/30/17
|
|
12/31/17
|
||||
Triangle Capital Corporation
|
|
|
|
|
|
|
|
|
|
|
|
112.42
|
|
|
106.41
|
|
|
89.13
|
|
|
61.13
|
|
NASDAQ Composite Index
|
|
|
|
|
|
|
|
|
|
|
|
206.25
|
|
|
214.78
|
|
|
227.44
|
|
|
242.29
|
|
NYSE Composite Index
|
|
|
|
|
|
|
|
|
|
|
|
151.36
|
|
|
155.99
|
|
|
162.88
|
|
|
171.83
|
|
Triangle Capital Corporation Peer Group Index(2)
|
|
|
|
|
|
|
|
|
|
|
|
138.33
|
|
|
134.23
|
|
|
133.96
|
|
|
132.22
|
|
(1)
|
From
December 31, 2012
to
December 31, 2017
.
|
(2)
|
The Triangle Capital Corporation Peer Group consists of the following companies: Apollo Investment Corporation, Ares Capital Corporation, BlackRock Capital Investment Corporation, Fidus Investment Corporation, Gladstone Investment Corporation, Gladstone Capital Corporation, Golub Capital BDC, Inc., Horizon Technology Finance Corporation, Hercules Capital, Inc., KCAP Financial, Inc., Main Street Capital Corporation, Medley Capital Corporation, New Mountain Finance Corporation, Oaktree Specialty Lending Corporation, PennantPark Investment Corporation, Prospect Capital Corporation, Solar Capital Ltd. and THL Credit, Inc.
|
|
|
Year Ended December 31,
|
||||||||||||||||||
|
|
2013
|
|
2014
|
|
2015
|
|
2016
|
|
2017
|
||||||||||
|
|
(Dollars and share amounts in thousands, except per share data)
|
||||||||||||||||||
Income statement data:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Investment income:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Total loan interest, fee and dividend income
|
|
$
|
100,755
|
|
|
$
|
104,273
|
|
|
$
|
121,062
|
|
|
$
|
113,332
|
|
|
$
|
122,290
|
|
Interest income from cash and cash equivalent investments
|
|
273
|
|
|
238
|
|
|
225
|
|
|
348
|
|
|
715
|
|
|||||
Total investment income
|
|
101,028
|
|
|
104,511
|
|
|
121,287
|
|
|
113,680
|
|
|
123,005
|
|
|||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest and other debt financing fees
|
|
20,234
|
|
|
21,180
|
|
|
26,754
|
|
|
26,721
|
|
|
29,261
|
|
|||||
Compensation expenses
|
|
15,831
|
|
|
17,562
|
|
|
19,009
|
|
|
23,676
|
|
|
16,136
|
|
|||||
General and administrative expenses
|
|
3,434
|
|
|
3,753
|
|
|
3,895
|
|
|
4,406
|
|
|
5,370
|
|
|||||
Total operating expenses
|
|
39,499
|
|
|
42,495
|
|
|
49,658
|
|
|
54,803
|
|
|
50,767
|
|
|||||
Net investment income
|
|
61,529
|
|
|
62,016
|
|
|
71,629
|
|
|
58,877
|
|
|
72,238
|
|
|||||
Net realized gains (losses):
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Non-Control/Non-Affiliate investments
|
|
15,882
|
|
|
7,396
|
|
|
9,003
|
|
|
(2,414
|
)
|
|
(3,683
|
)
|
|||||
Affiliate investments
|
|
4,828
|
|
|
7,733
|
|
|
2,315
|
|
|
4,399
|
|
|
(3,980
|
)
|
|||||
Control investments
|
|
(2,290
|
)
|
|
(1,498
|
)
|
|
(38,807
|
)
|
|
—
|
|
|
(45,206
|
)
|
|||||
Net realized gains (losses) on investments
|
|
18,420
|
|
|
13,631
|
|
|
(27,489
|
)
|
|
1,985
|
|
|
(52,869
|
)
|
|||||
Foreign currency borrowings
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,269
|
|
|||||
Net realized gains (losses)
|
|
18,420
|
|
|
13,631
|
|
|
(27,489
|
)
|
|
1,985
|
|
|
(51,600
|
)
|
|||||
Net unrealized appreciation (depreciation):
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Non-Control/Non-Affiliate investments
|
|
390
|
|
|
(38,467
|
)
|
|
(23,583
|
)
|
|
(9,080
|
)
|
|
(65,786
|
)
|
|||||
Affiliate investments
|
|
(1,427
|
)
|
|
(3,213
|
)
|
|
2,839
|
|
|
(5,473
|
)
|
|
(7,356
|
)
|
|||||
Control investments
|
|
2,848
|
|
|
(3,554
|
)
|
|
23,876
|
|
|
(11,464
|
)
|
|
27,547
|
|
|||||
Net unrealized appreciation (depreciation) on investments
|
|
1,811
|
|
|
(45,234
|
)
|
|
3,132
|
|
|
(26,017
|
)
|
|
(45,595
|
)
|
|||||
Foreign currency borrowings
|
|
404
|
|
|
1,071
|
|
|
2,363
|
|
|
(153
|
)
|
|
(2,822
|
)
|
|||||
Net unrealized appreciation (depreciation)
|
|
2,215
|
|
|
(44,163
|
)
|
|
5,495
|
|
|
(26,170
|
)
|
|
(48,417
|
)
|
|||||
Net realized and unrealized gains (losses) on investments and foreign currency borrowings
|
|
20,635
|
|
|
(30,532
|
)
|
|
(21,994
|
)
|
|
(24,185
|
)
|
|
(100,017
|
)
|
|||||
Loss on extinguishment of debt
|
|
(413
|
)
|
|
—
|
|
|
(1,394
|
)
|
|
—
|
|
|
—
|
|
|||||
Provision for taxes
|
|
(539
|
)
|
|
(3,122
|
)
|
|
(384
|
)
|
|
(436
|
)
|
|
(871
|
)
|
|||||
Net increase in net assets resulting from operations
|
|
$
|
81,212
|
|
|
$
|
28,362
|
|
|
$
|
47,857
|
|
|
$
|
34,256
|
|
|
$
|
(28,650
|
)
|
Net investment income per share — basic and diluted
|
|
$
|
2.23
|
|
|
$
|
2.08
|
|
|
$
|
2.16
|
|
|
$
|
1.62
|
|
|
$
|
1.55
|
|
Net increase in net assets resulting from operations per share — basic and diluted
|
|
$
|
2.94
|
|
|
$
|
0.95
|
|
|
$
|
1.44
|
|
|
$
|
0.94
|
|
|
$
|
(0.62
|
)
|
Net asset value per common share
|
|
$
|
16.10
|
|
|
$
|
16.11
|
|
|
$
|
15.23
|
|
|
$
|
15.13
|
|
|
$
|
13.43
|
|
Regular quarterly dividends/distributions per share
|
|
$
|
2.16
|
|
|
$
|
2.16
|
|
|
$
|
2.16
|
|
|
$
|
1.89
|
|
|
$
|
1.65
|
|
Supplemental dividends/distributions per share
|
|
—
|
|
|
0.40
|
|
|
0.20
|
|
|
—
|
|
|
—
|
|
|||||
Total dividends/distributions declared per common share
|
|
$
|
2.16
|
|
|
$2.56
|
|
$2.36
|
|
$1.89
|
|
$1.65
|
||||||||
Weighted average number of shares outstanding — basic and diluted
|
|
27,576
|
|
|
29,775
|
|
|
33,234
|
|
|
36,405
|
|
|
46,498
|
|
|
|
Year Ended December 31,
|
||||||||||||||||||
|
|
2013
|
|
2014
|
|
2015
|
|
2016
|
|
2017
|
||||||||||
|
|
(Dollars in thousands)
|
||||||||||||||||||
Balance sheet data:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Investments at fair value
|
|
$
|
664,373
|
|
|
$
|
887,223
|
|
|
$
|
977,277
|
|
|
$
|
1,037,907
|
|
|
$
|
1,016,284
|
|
Cash and cash equivalents
|
|
133,304
|
|
|
78,759
|
|
|
52,615
|
|
|
107,088
|
|
|
191,850
|
|
|||||
Interest and fees receivable
|
|
5,256
|
|
|
7,409
|
|
|
4,892
|
|
|
10,190
|
|
|
7,807
|
|
|||||
Prepaid expenses and other current assets
|
|
832
|
|
|
439
|
|
|
947
|
|
|
1,660
|
|
|
1,855
|
|
|||||
Deferred financing fees
|
|
1,654
|
|
|
1,231
|
|
|
3,480
|
|
|
2,700
|
|
|
5,186
|
|
|||||
Property and equipment, net
|
|
60
|
|
|
109
|
|
|
106
|
|
|
106
|
|
|
81
|
|
|||||
Total assets
|
|
$
|
805,479
|
|
|
$
|
975,170
|
|
|
$
|
1,039,317
|
|
|
$
|
1,159,651
|
|
|
$
|
1,223,063
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts payable and accrued liabilities
|
|
$
|
7,494
|
|
|
$
|
7,145
|
|
|
$
|
7,464
|
|
|
$
|
6,797
|
|
|
$
|
9,863
|
|
Interest payable
|
|
3,018
|
|
|
3,365
|
|
|
3,714
|
|
|
3,997
|
|
|
3,997
|
|
|||||
Taxes payable
|
|
1,065
|
|
|
2,506
|
|
|
735
|
|
|
490
|
|
|
796
|
|
|||||
Deferred income taxes
|
|
3,514
|
|
|
3,364
|
|
|
4,988
|
|
|
2,054
|
|
|
1,332
|
|
|||||
Borrowings under credit facility
|
|
11,221
|
|
|
62,620
|
|
|
131,257
|
|
|
127,012
|
|
|
156,071
|
|
|||||
Notes
|
|
145,120
|
|
|
145,646
|
|
|
162,142
|
|
|
162,755
|
|
|
163,408
|
|
|||||
SBA-guaranteed debentures payable
|
|
188,255
|
|
|
219,697
|
|
|
220,649
|
|
|
245,390
|
|
|
246,321
|
|
|||||
Total liabilities
|
|
359,687
|
|
|
444,343
|
|
|
530,949
|
|
|
548,495
|
|
|
581,788
|
|
|||||
Net assets
|
|
445,792
|
|
|
530,827
|
|
|
508,368
|
|
|
611,156
|
|
|
641,275
|
|
|||||
Total liabilities and net assets
|
|
$
|
805,479
|
|
|
$
|
975,170
|
|
|
$
|
1,039,317
|
|
|
$
|
1,159,651
|
|
|
$
|
1,223,063
|
|
Other data:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Weighted average yield on total investments(1)
|
|
12.8
|
%
|
|
11.6
|
%
|
|
10.6
|
%
|
|
10.2
|
%
|
|
9.6
|
%
|
|||||
Number of portfolio companies
|
|
79
|
|
|
91
|
|
|
92
|
|
|
88
|
|
|
89
|
|
|||||
Expense ratios (as percentage of average net assets):
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Compensation and general and administrative expenses
|
|
4.4
|
%
|
|
4.4
|
%
|
|
4.4
|
%
|
|
5.0
|
%
|
|
3.2
|
%
|
|||||
Interest and other financing fees
|
|
4.7
|
|
|
4.4
|
|
|
5.1
|
|
|
4.8
|
|
|
4.4
|
|
|||||
Total expenses
|
|
9.1
|
%
|
|
8.8
|
%
|
|
9.5
|
%
|
|
9.8
|
%
|
|
7.6
|
%
|
|||||
Total expenses, including loss on extinguishment of debt and provision for taxes
|
|
9.3
|
%
|
|
9.5
|
%
|
|
9.8
|
%
|
|
9.9
|
%
|
|
7.7
|
%
|
(1)
|
Excludes non-accrual debt investments.
|
|
|
Cost
|
|
Percentage of
Total Portfolio
|
|
Fair Value
|
|
Percentage of
Total Portfolio
|
||||||
December 31, 2017:
|
|
|
|
|
|
|
|
|
||||||
Subordinated debt and 2
nd
lien notes
|
|
$
|
710,543,854
|
|
|
63
|
%
|
|
$
|
589,548,358
|
|
|
58
|
%
|
Senior debt and 1
st
lien notes
|
|
275,088,787
|
|
|
25
|
|
|
262,803,297
|
|
|
26
|
|
||
Equity shares
|
|
134,301,587
|
|
|
12
|
|
|
162,543,691
|
|
|
16
|
|
||
Equity warrants
|
|
1,691,617
|
|
|
—
|
|
|
1,389,000
|
|
|
—
|
|
||
|
|
$
|
1,121,625,845
|
|
|
100
|
%
|
|
$
|
1,016,284,346
|
|
|
100
|
%
|
December 31, 2016:
|
|
|
|
|
|
|
|
|
||||||
Subordinated debt and 2
nd
lien notes
|
|
$
|
753,635,857
|
|
|
69
|
%
|
|
$
|
690,159,367
|
|
|
67
|
%
|
Senior debt and 1
st
lien notes
|
|
198,616,110
|
|
|
18
|
|
|
191,643,157
|
|
|
18
|
|
||
Equity shares
|
|
140,524,807
|
|
|
13
|
|
|
154,216,657
|
|
|
15
|
|
||
Equity warrants
|
|
4,154,717
|
|
|
—
|
|
|
1,888,000
|
|
|
—
|
|
||
|
|
$
|
1,096,931,491
|
|
|
100
|
%
|
|
$
|
1,037,907,181
|
|
|
100
|
%
|
December 31, 2017
|
Subordinated
Debt and 2
nd
Lien Notes
|
|
Senior Debt
and 1
st
Lien
Notes
|
|
Equity
Shares
|
|
Equity
Warrants
|
|
Total
|
||||||||||
Fair value, beginning of period
|
$
|
690,159,367
|
|
|
$
|
191,643,157
|
|
|
$
|
154,216,657
|
|
|
$
|
1,888,000
|
|
|
$
|
1,037,907,181
|
|
New investments
|
262,333,868
|
|
|
205,493,670
|
|
|
15,915,860
|
|
|
—
|
|
|
483,743,398
|
|
|||||
Investment reclass
|
33,614,656
|
|
|
(42,014,656
|
)
|
|
8,400,000
|
|
|
—
|
|
|
—
|
|
|||||
Proceeds from sales of investments
|
—
|
|
|
—
|
|
|
(29,065,946
|
)
|
|
(550,863
|
)
|
|
(29,616,809
|
)
|
|||||
Loan origination fees received
|
(4,355,181
|
)
|
|
(2,938,834
|
)
|
|
—
|
|
|
—
|
|
|
(7,294,015
|
)
|
|||||
Principal repayments received
|
(302,112,732
|
)
|
|
(71,949,131
|
)
|
|
—
|
|
|
—
|
|
|
(374,061,863
|
)
|
|||||
PIK interest earned
|
9,916,389
|
|
|
1,001,142
|
|
|
—
|
|
|
—
|
|
|
10,917,531
|
|
|||||
PIK interest payments received
|
(12,431,539
|
)
|
|
(507,979
|
)
|
|
—
|
|
|
—
|
|
|
(12,939,518
|
)
|
|||||
Accretion of loan discounts
|
419,114
|
|
|
57,778
|
|
|
—
|
|
|
—
|
|
|
476,892
|
|
|||||
Accretion of deferred loan origination revenue
|
4,846,747
|
|
|
1,490,694
|
|
|
—
|
|
|
—
|
|
|
6,337,441
|
|
|||||
Realized loss
|
(35,323,325
|
)
|
|
(14,160,007
|
)
|
|
(1,473,134
|
)
|
|
(1,912,237
|
)
|
|
(52,868,703
|
)
|
|||||
Unrealized appreciation (depreciation)
|
(57,519,006
|
)
|
|
(5,312,537
|
)
|
|
14,550,254
|
|
|
1,964,100
|
|
|
(46,317,189
|
)
|
|||||
Fair value, end of period
|
$
|
589,548,358
|
|
|
$
|
262,803,297
|
|
|
$
|
162,543,691
|
|
|
$
|
1,389,000
|
|
|
$
|
1,016,284,346
|
|
Weighted average yield on debt investments at end of period(1)
|
11.0
|
%
|
|||||||||||||||||
Weighted average yield on total investments at end of period(1)
|
9.6
|
%
|
|||||||||||||||||
Weighted average yield on total investments at end of period
|
8.5
|
%
|
December 31, 2016
|
Subordinated
Debt and 2
nd
Lien Notes
|
|
Senior Debt
and 1
st
Lien
Notes
|
|
Equity
Shares
|
|
Equity
Warrants
|
|
Total
|
||||||||||
Fair value, beginning of period
|
$
|
699,125,083
|
|
|
$
|
132,929,264
|
|
|
$
|
141,555,369
|
|
|
$
|
3,667,000
|
|
|
$
|
977,276,716
|
|
New investments
|
220,825,664
|
|
|
71,620,633
|
|
|
26,370,669
|
|
|
650,000
|
|
|
319,466,966
|
|
|||||
Investment reclass
|
4,020,247
|
|
|
(4,020,247
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Proceeds from sales of investments
|
—
|
|
|
—
|
|
|
(28,340,004
|
)
|
|
(5,742,355
|
)
|
|
(34,082,359
|
)
|
|||||
Loan origination fees received
|
(4,613,831
|
)
|
|
(1,200,160
|
)
|
|
—
|
|
|
—
|
|
|
(5,813,991
|
)
|
|||||
Principal repayments received
|
(194,883,407
|
)
|
|
(7,727,099
|
)
|
|
—
|
|
|
—
|
|
|
(202,610,506
|
)
|
|||||
PIK interest earned
|
13,784,921
|
|
|
1,449,498
|
|
|
—
|
|
|
—
|
|
|
15,234,419
|
|
|||||
PIK interest payments received
|
(9,326,564
|
)
|
|
(236,150
|
)
|
|
—
|
|
|
—
|
|
|
(9,562,714
|
)
|
|||||
Accretion of loan discounts
|
193,801
|
|
|
203,303
|
|
|
—
|
|
|
—
|
|
|
397,104
|
|
|||||
Accretion of deferred loan origination revenue
|
4,012,181
|
|
|
556,218
|
|
|
—
|
|
|
—
|
|
|
4,568,399
|
|
|||||
Realized gain (loss)
|
(14,752,679
|
)
|
|
(1,560,322
|
)
|
|
15,029,594
|
|
|
3,268,455
|
|
|
1,985,048
|
|
|||||
Unrealized appreciation (depreciation)
|
(28,226,049
|
)
|
|
(371,781
|
)
|
|
(398,971
|
)
|
|
44,900
|
|
|
(28,951,901
|
)
|
|||||
Fair value, end of period
|
$
|
690,159,367
|
|
|
$
|
191,643,157
|
|
|
$
|
154,216,657
|
|
|
$
|
1,888,000
|
|
|
$
|
1,037,907,181
|
|
Weighted average yield on debt investments at end of period(1)
|
11.7
|
%
|
|||||||||||||||||
Weighted average yield on total investments at end of period(1)
|
10.2
|
%
|
|||||||||||||||||
Weighted average yield on total investments at end of period
|
9.7
|
%
|
For the quarter ended:
|
|
Total
companies
|
|
Percent of total
investments at
fair value(1)
|
March 31, 2015
|
|
16
|
|
28%
|
June 30, 2015
|
|
15
|
|
26%
|
September 30, 2015
|
|
22
|
|
34%
|
December 31, 2015
|
|
17
|
|
28%
|
March 31, 2016
|
|
18
|
|
27%
|
June 30, 2016
|
|
19
|
|
30%
|
September 30, 2016
|
|
19
|
|
33%
|
December 31, 2016
|
|
20
|
|
33%
|
March 31, 2017
|
|
18
|
|
30%
|
June 30, 2017
|
|
20
|
|
29%
|
September 30, 2017
|
|
22
|
|
25%
|
December 31, 2017
|
|
21
|
|
35%
|
(1)
|
Exclusive of the fair value of new investments made during the quarter.
|
•
|
financial standing of the issuer of the security;
|
•
|
comparison of the business and financial plan of the issuer with actual results;
|
•
|
the size of the security held;
|
•
|
pending reorganization activity affecting the issuer, such as merger or debt restructuring;
|
•
|
ability of the issuer to obtain needed financing;
|
•
|
changes in the economy affecting the issuer;
|
•
|
financial statements and reports from portfolio company senior management and ownership;
|
•
|
the type of security, the security’s cost at the date of purchase and any contractual restrictions on the disposition of the security;
|
•
|
information as to any transactions or offers with respect to the security and/or sales to third parties of similar securities;
|
•
|
the issuer’s ability to make payments and the type of collateral;
|
•
|
the current and forecasted earnings of the issuer;
|
•
|
statistical ratios compared to lending standards and to other similar securities;
|
•
|
pending public offering of common stock by the issuer of the security;
|
•
|
special reports prepared by analysts; and
|
•
|
any other factors we deem pertinent with respect to a particular investment.
|
|
Years Ended December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
Recurring Fee Income:
|
|
|
|
|
|
||||||
Amortization of loan origination fees
|
$
|
2,445,485
|
|
|
$
|
2,161,711
|
|
|
$
|
2,061,004
|
|
Management, valuation and other fees
|
940,361
|
|
|
1,024,213
|
|
|
895,677
|
|
|||
Total Recurring Fee Income
|
3,385,846
|
|
|
3,185,924
|
|
|
2,956,681
|
|
|||
Non-Recurring Fee Income:
|
|
|
|
|
|
||||||
Prepayment fees
|
2,688,814
|
|
|
1,903,251
|
|
|
4,344,705
|
|
|||
Acceleration of unamortized loan origination fees
|
4,202,078
|
|
|
2,406,688
|
|
|
4,104,485
|
|
|||
Advisory and structuring fees
|
230,000
|
|
|
200,000
|
|
|
578,162
|
|
|||
Loan amendment fees
|
132,278
|
|
|
277,396
|
|
|
469,357
|
|
|||
Other fees
|
9,000
|
|
|
412,606
|
|
|
391,538
|
|
|||
Total Non-Recurring Fee Income
|
7,262,170
|
|
|
5,199,941
|
|
|
9,888,247
|
|
|||
Total Fee Income
|
$
|
10,648,016
|
|
|
$
|
8,385,865
|
|
|
$
|
12,844,928
|
|
Portfolio Company
|
Investment Type
|
December 31, 2017
|
||
Deva Holdings, Inc.
|
Revolver
|
$
|
2,500,000
|
|
DLC Acquisition, LLC
|
Revolver
|
1,800,000
|
|
|
Frank Entertainment Group, LLC(1)
|
Delayed Draw Senior
|
130,212
|
|
|
Frank Entertainment Group, LLC(1)
|
Delayed Draw Second Lien
|
303,827
|
|
|
HKW Capital Partners IV, L.P.
|
Private Equity
|
214,823
|
|
|
ICP Industries Inc.
|
Delayed Draw Term Loan
|
5,000,000
|
|
|
Lakeview Health Acquisition Company(1)
|
Revolver
|
1,387,367
|
|
|
Micross Solutions, LLC
|
Delayed Draw Term Loan
|
3,000,000
|
|
|
Nautic Partners VII, LP
|
Private Equity
|
509,080
|
|
|
Nomacorc, LLC(1)
|
Equity Investment
|
838,813
|
|
|
Orchid Underwriters Agency, LLC
|
Delayed Draw Term Loan
|
649,143
|
|
|
Schweiger Dermatology Group, LLC
|
Delayed Draw Term Loan
|
4,500,000
|
|
|
SCUF Gaming, Inc.
|
Revolver
|
2,000,000
|
|
|
Smile Brands, Inc.
|
Equity Investment
|
1,000,000
|
|
|
Smile Brands, Inc.
|
Delayed Draw Term Loan
|
18,826,531
|
|
|
SPC Partners V, LP
|
Private Equity
|
185,297
|
|
|
SPC Partners VI, LP
|
Private Equity
|
2,792,172
|
|
|
Tate's Bake Shop
|
Revolver
|
550,000
|
|
|
TGaS Advisors, LLC
|
Revolver
|
2,000,000
|
|
|
Total Unused Commitments
|
|
$
|
48,187,265
|
|
(1)
|
Represents a commitment to extend financing to a portfolio company where one or more of our current investments in the portfolio company are carried at less than cost. Our estimate of the fair value of the current investments in this portfolio company includes an analysis of the value of any unfunded commitments.
|
|
|
Total
|
|
2018
|
|
2019-2020
|
|
2021-2022
|
|
2023-Future
|
||||||||||
SBA-guaranteed debentures payable
|
|
$
|
250,000,000
|
|
|
$
|
—
|
|
|
$
|
61,390,000
|
|
|
$
|
94,500,000
|
|
|
$
|
94,110,000
|
|
Interest due on SBA-guaranteed debentures payable
|
|
42,140,128
|
|
|
9,751,246
|
|
|
17,594,557
|
|
|
8,373,273
|
|
|
6,421,052
|
|
|||||
Credit Facility borrowings
|
|
156,070,484
|
|
|
—
|
|
|
—
|
|
|
156,070,484
|
|
|
—
|
|
|||||
Interest and fees on Credit Facility(1)
|
|
30,727,452
|
|
|
7,817,175
|
|
|
15,655,602
|
|
|
7,254,675
|
|
|
—
|
|
|||||
Unused commitments to extend financing
|
|
48,187,265
|
|
|
48,187,265
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Notes
|
|
166,750,000
|
|
|
—
|
|
|
—
|
|
|
166,750,000
|
|
|
—
|
|
|||||
Interest on Notes
|
|
49,027,735
|
|
|
10,630,313
|
|
|
21,260,625
|
|
|
17,136,797
|
|
|
—
|
|
|||||
Operating lease payments(2)
|
|
623,208
|
|
|
435,571
|
|
|
187,637
|
|
|
—
|
|
|
—
|
|
|||||
Total
|
|
$
|
743,526,272
|
|
|
$
|
76,821,570
|
|
|
$
|
116,088,421
|
|
|
$
|
450,085,229
|
|
|
$
|
100,531,052
|
|
(1)
|
Amounts represent (i) unused Credit Facility fees calculated at a rate of 0.375% of the unused amount, which was $323.9 million as of
December 31, 2017
, (ii) interest expense calculated at a rate of 4.124% of outstanding Credit Facility borrowings, which were approximately $156.1 million as of
December 31, 2017
and (iii) annual fees of the Credit Facility administrative agent.
|
(2)
|
We lease our corporate office facility under an operating lease that terminates on May 31, 2019. We believe that our existing facilities will be adequate to meet our needs through
2018
, and that we will be able to obtain additional space when, where and as needed on acceptable terms.
|
|
Page
|
Number
|
|
Exhibit
|
|
|
|
3.1
|
|
|
|
|
|
3.2
|
|
|
|
|
|
3.3
|
|
|
|
|
|
3.4
|
|
|
|
|
|
4.1
|
|
|
|
|
|
4.2
|
|
|
|
|
|
4.3
|
|
|
|
|
|
Number
|
|
Exhibit
|
4.4
|
|
|
|
|
|
4.5
|
|
|
|
|
|
4.6
|
|
|
|
|
|
4.7
|
|
|
|
|
|
4.8
|
|
|
|
|
|
10.1†
|
|
|
|
|
|
10.2†
|
|
|
|
|
|
10.3
|
|
|
|
|
|
10.4
|
|
|
|
|
|
10.5
|
|
|
|
|
|
10.6†
|
|
|
|
|
|
10.7†
|
|
|
|
|
|
10.8†
|
|
|
|
|
|
10.9
|
|
|
|
|
|
Number
|
|
Exhibit
|
10.10
|
|
|
|
|
|
10.11
|
|
|
|
|
|
10.12
|
|
|
|
|
|
10.13
|
|
|
|
|
|
10.14
|
|
|
|
|
|
10.15
|
|
|
|
|
|
10.16
|
|
|
|
|
|
10.17†
|
|
|
|
|
|
10.18
|
|
|
|
|
|
10.19†
|
|
|
|
|
|
10.20†
|
|
|
|
|
|
10.21
|
|
|
|
|
|
10.22†
|
|
|
|
|
|
Number
|
|
Exhibit
|
10.23†
|
|
|
|
|
|
10.24†
|
|
|
|
|
|
10.25†
|
|
|
|
|
|
11
|
|
|
|
|
|
14.1
|
|
|
|
|
|
21.1
|
|
|
|
|
|
23.1
|
|
|
|
|
|
31.1
|
|
|
|
|
|
31.2
|
|
|
|
|
|
32.1
|
|
|
|
|
|
32.2
|
|
†
|
Management contract or compensatory plan or arrangement.
|
*
|
Filed herewith.
|
**
|
Furnished herewith.
|
|
|
TRIANGLE CAPITAL CORPORATION
|
||
|
|
|||
|
|
By:
|
|
/s/ E. Ashton Poole
|
|
|
|
|
Name: E. Ashton Poole
|
|
|
|
|
Title: Chief Executive Officer and Chairman of the Board of Directors
|
Signature
|
|
Title
|
|
Date
|
/s/ E. Ashton Poole
|
|
Chief Executive Officer and Chairman of the Board of Directors (Principal Executive Officer)
|
|
February 28, 2018
|
E. Ashton Poole
|
|
|
||
|
|
|
|
|
/s/ Steven C. Lilly
|
|
Chief Financial Officer, Secretary and Director (Principal Financial Officer)
|
|
February 28, 2018
|
Steven C. Lilly
|
|
|
||
|
|
|
|
|
/s/ C. Robert Knox, Jr.
|
|
Controller (Principal Accounting Officer)
|
|
February 28, 2018
|
C. Robert Knox, Jr.
|
|
|
|
|
|
|
|
|
|
/s/ W. McComb Dunwoody
|
|
Director
|
|
February 28, 2018
|
W. McComb Dunwoody
|
|
|
|
|
|
|
|
|
|
/s/ Mark M. Gambill
|
|
Director
|
|
February 28, 2018
|
Mark M. Gambill
|
|
|
|
|
|
|
|
|
|
/s/ Benjamin S. Goldstein
|
|
Director
|
|
February 28, 2018
|
Benjamin S. Goldstein
|
|
|
|
|
|
|
|
|
|
/s/ Mark F. Mulhern
|
|
Director
|
|
February 28, 2018
|
Mark F. Mulhern
|
|
|
|
|
|
|
|
|
|
/s/ Simon B. Rich, Jr.
|
|
Director
|
|
February 28, 2018
|
Simon B. Rich, Jr.
|
|
|
|
|
|
|
|
|
|
/s/ Garland S. Tucker, III
|
|
Director
|
|
February 28, 2018
|
Garland S. Tucker, III
|
|
|
|
|
|
|
Page
|
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
|
|
December 31,
|
||||||
|
|
2017
|
|
2016
|
||||
Assets:
|
|
|
|
|
||||
Investments at fair value:
|
|
|
|
|
||||
Non-Control / Non-Affiliate investments (cost of $910,150,765 and $888,974,154 at December 31, 2017 and 2016, respectively)
|
|
$
|
831,194,397
|
|
|
$
|
857,604,639
|
|
Affiliate investments (cost of $149,099,548 and $162,539,224 at December 31, 2017 and 2016, respectively)
|
|
147,101,949
|
|
|
161,510,773
|
|
||
Control investments (cost of $62,375,532 and $45,418,113 at December 31, 2017 and 2016, respectively)
|
|
37,988,000
|
|
|
18,791,769
|
|
||
Total investments at fair value
|
|
1,016,284,346
|
|
|
1,037,907,181
|
|
||
Cash and cash equivalents
|
|
191,849,697
|
|
|
107,087,663
|
|
||
Interest and fees receivable
|
|
7,806,887
|
|
|
10,189,788
|
|
||
Prepaid expenses and other current assets
|
|
1,854,861
|
|
|
1,659,570
|
|
||
Deferred financing fees
|
|
5,186,672
|
|
|
2,699,960
|
|
||
Property and equipment, net
|
|
81,149
|
|
|
106,494
|
|
||
Total assets
|
|
$
|
1,223,063,612
|
|
|
$
|
1,159,650,656
|
|
Liabilities:
|
|
|
|
|
||||
Accounts payable and accrued liabilities
|
|
$
|
9,863,209
|
|
|
$
|
6,797,244
|
|
Interest payable
|
|
3,997,480
|
|
|
3,996,940
|
|
||
Taxes payable
|
|
796,111
|
|
|
489,691
|
|
||
Deferred income taxes
|
|
1,331,528
|
|
|
2,053,701
|
|
||
Borrowings under credit facility
|
|
156,070,484
|
|
|
127,011,475
|
|
||
Notes, net of deferred financing fees
|
|
163,408,301
|
|
|
162,755,381
|
|
||
SBA-guaranteed debentures payable, net of deferred financing fees
|
|
246,321,125
|
|
|
245,389,966
|
|
||
Total liabilities
|
|
581,788,238
|
|
|
548,494,398
|
|
||
Commitments and contingencies (Note 8)
|
|
|
|
|
||||
Net Assets:
|
|
|
|
|
||||
Common stock, $0.001 par value per share (150,000,000 shares authorized, 47,740,832 and 40,401,292 shares issued and outstanding as of December 31, 2017 and 2016, respectively)
|
|
47,741
|
|
|
40,401
|
|
||
Additional paid in capital
|
|
823,614,881
|
|
|
686,835,054
|
|
||
Net investment income in excess of distributions
|
|
8,305,431
|
|
|
5,884,512
|
|
||
Net accumulated realized losses
|
|
(84,883,623
|
)
|
|
(24,211,594
|
)
|
||
Net unrealized depreciation
|
|
(105,809,056
|
)
|
|
(57,392,115
|
)
|
||
Total net assets
|
|
641,275,374
|
|
|
611,156,258
|
|
||
Total liabilities and net assets
|
|
$
|
1,223,063,612
|
|
|
$
|
1,159,650,656
|
|
Net asset value per share
|
|
$
|
13.43
|
|
|
$
|
15.13
|
|
|
|
Year Ended December 31,
|
||||||||||
|
|
2017
|
|
2016
|
|
2015
|
||||||
Investment income:
|
|
|
|
|
|
|
||||||
Interest income:
|
|
|
|
|
|
|
||||||
Non-Control / Non-Affiliate investments
|
|
$
|
83,421,527
|
|
|
$
|
73,110,821
|
|
|
$
|
69,880,678
|
|
Affiliate investments
|
|
13,462,551
|
|
|
13,262,066
|
|
|
16,812,432
|
|
|||
Control investments
|
|
1,155,791
|
|
|
1,017,716
|
|
|
446,301
|
|
|||
Total interest income
|
|
98,039,869
|
|
|
87,390,603
|
|
|
87,139,411
|
|
|||
Dividend income:
|
|
|
|
|
|
|
||||||
Non-Control / Non-Affiliate investments
|
|
2,364,569
|
|
|
912,304
|
|
|
4,373,803
|
|
|||
Affiliate investments
|
|
319,619
|
|
|
1,107,920
|
|
|
1,122,125
|
|
|||
Control investments
|
|
—
|
|
|
300,333
|
|
|
79
|
|
|||
Total dividend income
|
|
2,684,188
|
|
|
2,320,557
|
|
|
5,496,007
|
|
|||
Fee and other income:
|
|
|
|
|
|
|
||||||
Non-Control / Non-Affiliate investments
|
|
9,134,573
|
|
|
6,735,108
|
|
|
9,084,933
|
|
|||
Affiliate investments
|
|
1,106,151
|
|
|
1,250,757
|
|
|
3,359,995
|
|
|||
Control investments
|
|
407,292
|
|
|
400,000
|
|
|
400,000
|
|
|||
Total fee and other income
|
|
10,648,016
|
|
|
8,385,865
|
|
|
12,844,928
|
|
|||
Payment-in-kind interest income:
|
|
|
|
|
|
|
||||||
Non-Control / Non-Affiliate investments
|
|
8,367,457
|
|
|
11,113,845
|
|
|
10,911,656
|
|
|||
Affiliate investments
|
|
2,550,074
|
|
|
4,120,574
|
|
|
4,669,868
|
|
|||
Total payment-in-kind interest income
|
|
10,917,531
|
|
|
15,234,419
|
|
|
15,581,524
|
|
|||
Interest income from cash and cash equivalent investments
|
|
715,028
|
|
|
348,113
|
|
|
224,743
|
|
|||
Total investment income
|
|
123,004,632
|
|
|
113,679,557
|
|
|
121,286,613
|
|
|||
Operating expenses:
|
|
|
|
|
|
|
||||||
Interest and other financing fees
|
|
29,261,030
|
|
|
26,720,572
|
|
|
26,754,001
|
|
|||
Compensation expenses
|
|
16,135,739
|
|
|
23,675,809
|
|
|
19,009,256
|
|
|||
General and administrative expenses
|
|
5,370,046
|
|
|
4,406,303
|
|
|
3,894,253
|
|
|||
Total operating expenses
|
|
50,766,815
|
|
|
54,802,684
|
|
|
49,657,510
|
|
|||
Net investment income
|
|
72,237,817
|
|
|
58,876,873
|
|
|
71,629,103
|
|
|||
Realized and unrealized gains (losses) on investments and foreign currency borrowings:
|
|
|
|
|
|
|
||||||
Net realized gains (losses):
|
|
|
|
|
|
|
||||||
Non-Control / Non-Affiliate investments
|
|
(3,683,168
|
)
|
|
(2,413,750
|
)
|
|
9,002,793
|
|
|||
Affiliate investments
|
|
(3,979,667
|
)
|
|
4,398,798
|
|
|
2,314,896
|
|
|||
Control investments
|
|
(45,205,868
|
)
|
|
—
|
|
|
(38,807,152
|
)
|
|||
Net realized gains (losses) on investments
|
|
(52,868,703
|
)
|
|
1,985,048
|
|
|
(27,489,463
|
)
|
|||
Foreign currency borrowings
|
|
1,268,776
|
|
|
—
|
|
|
—
|
|
|||
Net realized gains (losses)
|
|
(51,599,927
|
)
|
|
1,985,048
|
|
|
(27,489,463
|
)
|
|||
Net unrealized appreciation (depreciation):
|
|
|
|
|
|
|
||||||
Non-Control / Non-Affiliate investments
|
|
(65,786,245
|
)
|
|
(9,079,811
|
)
|
|
(23,583,035
|
)
|
|||
Affiliate investments
|
|
(7,356,046
|
)
|
|
(5,473,012
|
)
|
|
2,839,512
|
|
|||
Control investments
|
|
27,547,274
|
|
|
(11,464,464
|
)
|
|
23,875,966
|
|
|||
Net unrealized appreciation (depreciation) on investments
|
|
(45,595,017
|
)
|
|
(26,017,287
|
)
|
|
3,132,443
|
|
|||
Foreign currency borrowings
|
|
(2,821,924
|
)
|
|
(152,957
|
)
|
|
2,363,214
|
|
|||
Net unrealized appreciation (depreciation)
|
|
(48,416,941
|
)
|
|
(26,170,244
|
)
|
|
5,495,657
|
|
|||
Net realized and unrealized losses on investments and foreign currency borrowings
|
|
(100,016,868
|
)
|
|
(24,185,196
|
)
|
|
(21,993,806
|
)
|
|||
Loss on extinguishment of debt
|
|
—
|
|
|
—
|
|
|
(1,394,017
|
)
|
|||
Provision for taxes
|
|
(871,410
|
)
|
|
(435,245
|
)
|
|
(384,028
|
)
|
|||
Net increase (decrease) in net assets resulting from operations
|
|
$
|
(28,650,461
|
)
|
|
$
|
34,256,432
|
|
|
$
|
47,857,252
|
|
Net investment income per share — basic and diluted
|
|
$
|
1.55
|
|
|
$
|
1.62
|
|
|
$
|
2.16
|
|
Net increase (decrease) in net assets resulting from operations per share — basic and diluted
|
|
$
|
(0.62
|
)
|
|
$
|
0.94
|
|
|
$
|
1.44
|
|
Dividends/distributions per share:
|
|
|
|
|
|
|
|
|
|
|||
Regular quarterly dividends/distributions
|
|
$
|
1.65
|
|
|
$
|
1.89
|
|
|
$
|
2.16
|
|
Supplemental dividends/distributions
|
|
—
|
|
|
—
|
|
|
0.20
|
|
|||
Total dividends/distributions
|
|
$
|
1.65
|
|
|
$
|
1.89
|
|
|
$
|
2.36
|
|
Weighted average number of shares outstanding — basic and diluted
|
|
46,497,977
|
|
|
36,405,024
|
|
|
33,234,319
|
|
|
|
Common Stock
|
|
Additional
Paid In
Capital
|
|
Investment
Income
in Excess of
Distributions
|
|
Accumulated
Realized
Gains
(Losses) on
Investments
|
|
Net
Unrealized
Appreciation
(Depreciation)
|
|
|
|||||||||||||||
|
|
Number
of Shares
|
|
Par
Value
|
|
|
|
|
|
Total
Net Assets
|
|||||||||||||||||
Balance, January 1, 2015
|
|
32,950,288
|
|
|
$
|
32,950
|
|
|
$
|
542,119,994
|
|
|
$
|
12,926,514
|
|
|
$
|
12,464,699
|
|
|
$
|
(36,717,528
|
)
|
|
$
|
530,826,629
|
|
Net investment income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
71,629,103
|
|
|
—
|
|
|
—
|
|
|
71,629,103
|
|
||||||
Stock-based compensation
|
|
—
|
|
|
—
|
|
|
6,989,341
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,989,341
|
|
||||||
Net realized gain (loss) on investments / foreign currency
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(27,489,463
|
)
|
|
27,062,153
|
|
|
(427,310
|
)
|
||||||
Net unrealized depreciation on investments / foreign currency
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(21,566,496
|
)
|
|
(21,566,496
|
)
|
||||||
Loss on extinguishment of debt
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,394,017
|
)
|
|
—
|
|
|
—
|
|
|
(1,394,017
|
)
|
||||||
Provision for taxes
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(384,028
|
)
|
|
—
|
|
|
—
|
|
|
(384,028
|
)
|
||||||
Return of capital and other tax related adjustments
|
|
—
|
|
|
—
|
|
|
(1,039,969
|
)
|
|
3,585,623
|
|
|
(2,545,654
|
)
|
|
—
|
|
|
—
|
|
||||||
Dividends/distributions declared
|
|
179,075
|
|
|
179
|
|
|
3,725,998
|
|
|
(70,236,054
|
)
|
|
(8,242,911
|
)
|
|
—
|
|
|
(74,752,788
|
)
|
||||||
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
|
|
(115,077
|
)
|
|
(115
|
)
|
|
(2,497,597
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,497,712
|
)
|
||||||
Balance, December 31, 2015
|
|
33,375,126
|
|
|
$
|
33,375
|
|
|
$
|
549,242,439
|
|
|
$
|
16,127,141
|
|
|
$
|
(25,813,329
|
)
|
|
$
|
(31,221,871
|
)
|
|
$
|
508,367,755
|
|
Net investment income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
58,876,873
|
|
|
—
|
|
|
—
|
|
|
58,876,873
|
|
||||||
Stock-based compensation
|
|
—
|
|
|
—
|
|
|
10,331,464
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10,331,464
|
|
||||||
Net realized gain (loss) on investments / foreign currency
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,985,048
|
|
|
600,222
|
|
|
2,585,270
|
|
||||||
Net unrealized depreciation on investments / foreign currency
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(26,770,466
|
)
|
|
(26,770,466
|
)
|
||||||
Provision for taxes
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(435,245
|
)
|
|
—
|
|
|
—
|
|
|
(435,245
|
)
|
||||||
Return of capital and other tax related adjustments
|
|
—
|
|
|
—
|
|
|
(484,037
|
)
|
|
867,350
|
|
|
(383,313
|
)
|
|
—
|
|
|
—
|
|
||||||
Dividends/distributions declared
|
|
160,948
|
|
|
160
|
|
|
3,075,393
|
|
|
(69,551,607
|
)
|
|
—
|
|
|
—
|
|
|
(66,476,054
|
)
|
||||||
Public offering of common stock
|
|
6,742,362
|
|
|
6,742
|
|
|
129,119,482
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
129,126,224
|
|
||||||
Issuance of restricted stock
|
|
364,605
|
|
|
365
|
|
|
(365
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Common stock withheld for payroll taxes upon vesting of restricted stock
|
|
(241,749
|
)
|
|
(241
|
)
|
|
(4,449,322
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,449,563
|
)
|
||||||
Balance, December 31, 2016
|
|
40,401,292
|
|
|
$
|
40,401
|
|
|
$
|
686,835,054
|
|
|
$
|
5,884,512
|
|
|
$
|
(24,211,594
|
)
|
|
$
|
(57,392,115
|
)
|
|
$
|
611,156,258
|
|
Net investment income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
72,237,817
|
|
|
—
|
|
|
—
|
|
|
72,237,817
|
|
||||||
Stock-based compensation
|
|
—
|
|
|
—
|
|
|
6,022,861
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,022,861
|
|
||||||
Net realized gain (loss) on investments / foreign currency
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(51,599,927
|
)
|
|
54,405,862
|
|
|
2,805,935
|
|
||||||
Net unrealized depreciation on investments / foreign currency
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(102,822,803
|
)
|
|
(102,822,803
|
)
|
||||||
Provision for taxes
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(871,410
|
)
|
|
—
|
|
|
—
|
|
|
(871,410
|
)
|
||||||
Return of capital and other tax related adjustments
|
|
—
|
|
|
—
|
|
|
(689,101
|
)
|
|
9,761,203
|
|
|
(9,072,102
|
)
|
|
—
|
|
|
—
|
|
||||||
Dividends/distributions declared
|
|
91,366
|
|
|
91
|
|
|
1,637,467
|
|
|
(78,706,691
|
)
|
|
—
|
|
|
—
|
|
|
(77,069,133
|
)
|
||||||
Public offering of common stock
|
|
7,000,000
|
|
|
7,000
|
|
|
131,989,144
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
131,996,144
|
|
||||||
Issuance of restricted stock
|
|
360,470
|
|
|
361
|
|
|
(361
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Common stock withheld for payroll taxes upon vesting of restricted stock
|
|
(112,296
|
)
|
|
(112
|
)
|
|
(2,180,183
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,180,295
|
)
|
||||||
Balance, December 31, 2017
|
|
47,740,832
|
|
|
$
|
47,741
|
|
|
$
|
823,614,881
|
|
|
$
|
8,305,431
|
|
|
$
|
(84,883,623
|
)
|
|
$
|
(105,809,056
|
)
|
|
$
|
641,275,374
|
|
|
|
Year Ended December 31,
|
||||||||||
|
|
2017
|
|
2016
|
|
2015
|
||||||
Cash flows from operating activities:
|
|
|
|
|
|
|
||||||
Net increase (decrease) in net assets resulting from operations
|
|
$
|
(28,650,461
|
)
|
|
$
|
34,256,432
|
|
|
$
|
47,857,252
|
|
Adjustments to reconcile net increase (decrease) in net assets resulting from operations to net cash used in operating activities:
|
|
|
|
|
|
|
||||||
Purchases of portfolio investments
|
|
(483,743,398
|
)
|
|
(319,466,966
|
)
|
|
(453,928,052
|
)
|
|||
Repayments received/sales of portfolio investments
|
|
403,678,672
|
|
|
236,692,865
|
|
|
343,268,967
|
|
|||
Loan origination and other fees received
|
|
7,294,015
|
|
|
5,813,991
|
|
|
7,099,587
|
|
|||
Net realized (gains) losses on investments
|
|
52,868,703
|
|
|
(1,985,048
|
)
|
|
27,489,463
|
|
|||
Net realized gain on foreign currency borrowings
|
|
(1,268,776
|
)
|
|
—
|
|
|
—
|
|
|||
Net unrealized (appreciation) depreciation on investments
|
|
46,317,189
|
|
|
28,951,901
|
|
|
(4,757,093
|
)
|
|||
Net unrealized (appreciation) depreciation on foreign currency borrowings
|
|
2,821,924
|
|
|
152,957
|
|
|
(2,363,214
|
)
|
|||
Deferred income taxes
|
|
(722,173
|
)
|
|
(2,934,616
|
)
|
|
1,624,648
|
|
|||
Payment-in-kind interest accrued, net of payments received
|
|
2,021,987
|
|
|
(5,671,705
|
)
|
|
(2,573,814
|
)
|
|||
Amortization of deferred financing fees
|
|
2,514,459
|
|
|
2,226,066
|
|
|
2,162,562
|
|
|||
Loss on extinguishment of debt
|
|
—
|
|
|
—
|
|
|
1,394,017
|
|
|||
Accretion of loan origination and other fees
|
|
(6,337,441
|
)
|
|
(4,568,399
|
)
|
|
(6,165,489
|
)
|
|||
Accretion of loan discounts
|
|
(476,892
|
)
|
|
(397,104
|
)
|
|
(487,163
|
)
|
|||
Accretion of discount on SBA-guaranteed debentures payable
|
|
—
|
|
|
31,899
|
|
|
188,295
|
|
|||
Depreciation expense
|
|
65,857
|
|
|
70,108
|
|
|
60,244
|
|
|||
Stock-based compensation
|
|
6,022,861
|
|
|
10,331,464
|
|
|
6,989,341
|
|
|||
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
||||||
Interest and fees receivable
|
|
2,382,901
|
|
|
(5,297,642
|
)
|
|
2,516,959
|
|
|||
Prepaid expenses and other current assets
|
|
(195,291
|
)
|
|
(712,502
|
)
|
|
(508,207
|
)
|
|||
Accounts payable and accrued liabilities
|
|
3,065,965
|
|
|
(666,270
|
)
|
|
318,841
|
|
|||
Interest payable
|
|
540
|
|
|
282,470
|
|
|
349,233
|
|
|||
Taxes payable
|
|
306,420
|
|
|
(245,807
|
)
|
|
(1,770,533
|
)
|
|||
Net cash provided by (used) in operating activities
|
|
7,967,061
|
|
|
(23,135,906
|
)
|
|
(31,234,156
|
)
|
|||
Cash flows from investing activities:
|
|
|
|
|
|
|
||||||
Purchases of property and equipment
|
|
(40,512
|
)
|
|
(70,904
|
)
|
|
(57,189
|
)
|
|||
Net cash used in investing activities
|
|
(40,512
|
)
|
|
(70,904
|
)
|
|
(57,189
|
)
|
|||
Cash flows from financing activities:
|
|
|
|
|
|
|
||||||
Borrowings under SBA-guaranteed debentures payable
|
|
—
|
|
|
32,800,000
|
|
|
—
|
|
|||
Repayments of SBA-guaranteed debentures payable
|
|
—
|
|
|
(7,800,000
|
)
|
|
—
|
|
|||
Borrowings under credit facility
|
|
141,700,000
|
|
|
104,901,849
|
|
|
215,000,000
|
|
|||
Repayments of borrowings under credit facility
|
|
(114,194,139
|
)
|
|
(109,300,000
|
)
|
|
(144,000,000
|
)
|
|||
Proceeds from notes
|
|
—
|
|
|
—
|
|
|
83,372,640
|
|
|||
Redemption of notes
|
|
—
|
|
|
—
|
|
|
(69,000,000
|
)
|
|||
Financing fees paid
|
|
(3,417,092
|
)
|
|
(1,123,401
|
)
|
|
(2,919,436
|
)
|
|||
Net proceeds (expenses) related to public offerings of common stock
|
|
131,996,144
|
|
|
129,126,224
|
|
|
(54,967
|
)
|
|||
Common stock withheld for taxes upon vesting of restricted stock
|
|
(2,180,295
|
)
|
|
(4,449,563
|
)
|
|
(2,497,712
|
)
|
|||
Cash dividends/distributions paid
|
|
(77,069,133
|
)
|
|
(66,476,054
|
)
|
|
(74,752,788
|
)
|
|||
Net cash provided by financing activities
|
|
76,835,485
|
|
|
77,679,055
|
|
|
5,147,737
|
|
|||
Net increase (decrease) in cash and cash equivalents
|
|
84,762,034
|
|
|
54,472,245
|
|
|
(26,143,608
|
)
|
|||
Cash and cash equivalents, beginning of year
|
|
107,087,663
|
|
|
52,615,418
|
|
|
78,759,026
|
|
|||
Cash and cash equivalents, end of year
|
|
$
|
191,849,697
|
|
|
$
|
107,087,663
|
|
|
$
|
52,615,418
|
|
Supplemental disclosure of cash flow information:
|
|
|
|
|
|
|
||||||
Cash paid for interest
|
|
$
|
25,587,590
|
|
|
$
|
23,366,963
|
|
|
$
|
23,021,114
|
|
Summary of non-cash financing transactions:
|
|
|
|
|
|
|
||||||
Dividends paid through DRIP share issuances
|
|
$
|
1,637,558
|
|
|
$
|
3,075,553
|
|
|
$
|
3,726,177
|
|
TRIANGLE CAPITAL CORPORATION
Consolidated Schedule of Investments
December 31, 2017
|
||||||||||||||||
Portfolio Company
|
|
Industry
|
|
Type of Investment
(1)(2)(7)
|
|
Principal
Amount
|
|
Cost
|
|
Fair
Value
(3)
|
||||||
Non–Control / Non–Affiliate Investments:
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Access Medical Acquisition, Inc. (3%)*
|
|
Operator of Primary Care Clinics
|
|
Subordinated Notes (10% Cash, 2% PIK, Due 01/22)
|
|
$
|
13,819,514
|
|
|
$
|
13,630,067
|
|
|
$
|
13,630,067
|
|
|
|
Class A Units (1,500,000 units)
|
|
|
|
901,026
|
|
|
3,610,000
|
|
||||||
|
|
|
|
13,819,514
|
|
|
14,531,093
|
|
|
17,240,067
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Aden & Anais Holdings, Inc. (0%)*
|
|
Baby Products
|
|
Common Stock (20,000 shares)
|
|
|
|
2,000,000
|
|
|
601,000
|
|
||||
|
|
|
|
|
|
2,000,000
|
|
|
601,000
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
AKKR-MVSC Member, LLC (F/K/A Motor Vehicle Software Corporation) (0%)*
|
|
Provider of EVR Services
|
|
Class A Units (1,000,000 units)
|
|
|
|
1,092,964
|
|
|
1,413,000
|
|
||||
|
|
|
|
|
|
1,092,964
|
|
|
1,413,000
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
AM General, LLC (4%)*
|
|
Defense Manufacturing
|
|
Senior Note (LIBOR + 7.25%, 8.6% Cash,
Due 12/21)
(8)
|
|
9,000,000
|
|
|
8,875,311
|
|
|
8,886,000
|
|
|||
|
|
Second Lien Term Note (LIBOR +11.75%, 13.1% Cash, Due 06/22)
(8)
|
|
20,000,000
|
|
|
19,480,694
|
|
|
19,593,000
|
|
|||||
|
|
|
|
29,000,000
|
|
|
28,356,005
|
|
|
28,479,000
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Avantor, Inc. (0%)*
|
|
Life Sciences and Advanced Technologies
|
|
Subordinated Note (9.0% Cash, Due 10/25)
|
|
500,000
|
|
|
500,000
|
|
|
500,000
|
|
|||
|
|
|
|
500,000
|
|
|
500,000
|
|
|
500,000
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
AVL Holdings, Inc. (0%)*
|
|
Manufacturer and Distributor for Independent Artists and Authors
|
|
Common Stock (138 shares)
|
|
|
|
1,300,000
|
|
|
2,824,000
|
|
||||
|
|
|
|
|
|
1,300,000
|
|
|
2,824,000
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Baker Hill Acquisition, LLC (2%)*
|
|
Loan Origination Software Solutions Provider
|
|
Second Lien Term Notes (LIBOR + 11.0%, 12.3% Cash, Due 03/21)
(8)
|
|
13,500,000
|
|
|
13,367,659
|
|
|
11,130,000
|
|
|||
|
|
Delayed Draw Term Note (LIBOR + 11.0%, 12.3% Cash, Due 03/21)
(8)
|
|
2,000,000
|
|
|
1,982,177
|
|
|
1,982,177
|
|
|||||
|
|
Limited Partnership Interest
|
|
|
|
1,498,500
|
|
|
105,000
|
|
||||||
|
|
|
|
15,500,000
|
|
|
16,848,336
|
|
|
13,217,177
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Cafe Enterprises, Inc. (0%)*
|
|
Restaurant
|
|
Second Lien Term Note (Prime + 5.75%, 10.3% Cash, Due 03/19)
(6)(8)
|
|
2,019,425
|
|
|
1,956,096
|
|
|
—
|
|
|||
|
|
Subordinated Note (7% Cash, 7% PIK, Due 09/19)
(6)
|
|
15,190,538
|
|
|
13,745,570
|
|
|
—
|
|
|||||
|
|
Series C Preferred Stock (10,000 shares)
|
|
|
|
1,000,000
|
|
|
—
|
|
||||||
|
|
|
|
17,209,963
|
|
|
16,701,666
|
|
|
—
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Captek Softgel International, Inc.
(5%)*
|
|
Nutraceuticals Manufacturer
|
|
Subordinated Note (10% Cash, 1.5% PIK, Due 01/23)
|
|
30,813,099
|
|
|
30,534,147
|
|
|
30,534,147
|
|
|||
Common Stock (38,023 shares)
|
|
|
|
3,957,697
|
|
|
4,137,000
|
|
||||||||
|
|
|
30,813,099
|
|
|
34,491,844
|
|
|
34,671,147
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Carolina Beverage Group, LLC (0%)*
|
|
Beverage Manufacturing and Packaging
|
|
Class B Units (11,974 units)
|
|
|
|
119,735
|
|
|
1,873,000
|
|
||||
|
|
|
|
|
119,735
|
|
|
1,873,000
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Centerfield Media Holding Company (0%)*
|
|
Digital Marketing
|
|
Common Shares (500 shares)
|
|
|
|
500,000
|
|
|
1,129,000
|
|
||||
|
|
|
|
|
|
500,000
|
|
|
1,129,000
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
CIBT Global, Inc. (2%)*
|
|
Provider of Mobility Services
|
|
Second Lien Term Note (LIBOR + 7.75%, 9.1% Cash, Due 06/25)
(8)
|
|
10,000,000
|
|
|
9,904,429
|
|
|
9,815,000
|
|
|||
|
|
|
|
10,000,000
|
|
|
9,904,429
|
|
|
9,815,000
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
CIS Acquisition, LLC (0%)*
|
|
Secure Communications and Computing Solutions Provider
|
|
Units (1.09 units)
|
|
|
|
277,538
|
|
|
277,538
|
|
||||
|
|
|
|
|
|
277,538
|
|
|
277,538
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Community Intervention Services, Inc. (0%)*
|
|
Provider of Behavioral Health Services
|
|
Subordinated Note (7% Cash, 6% PIK, Due 01/21)
(6)
|
|
20,969,036
|
|
|
17,732,558
|
|
|
—
|
|
|||
|
|
|
|
20,969,036
|
|
|
17,732,558
|
|
|
—
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Constellis Holdings, LLC (1%)*
|
|
Provider of Security and Risk Management Services
|
|
Second Lien Term Note (LIBOR + 9.0%, 10.3% Cash, Due 04/25)
(8)
|
|
5,000,000
|
|
|
4,929,791
|
|
|
4,894,000
|
|
|||
|
|
|
|
5,000,000
|
|
|
4,929,791
|
|
|
4,894,000
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
CPower Ultimate HoldCo, LLC (0%)*
|
|
Demand Response Business
|
|
Units (345,542 units)
|
|
|
|
345,542
|
|
|
1,988,000
|
|
||||
|
|
|
|
|
|
345,542
|
|
|
1,988,000
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
TRIANGLE CAPITAL CORPORATION
Consolidated Schedule of Investments — (Continued)
December 31, 2017
|
||||||||||||||||
Portfolio Company
|
|
Industry
|
|
Type of Investment
(1)(2)(7)
|
|
Principal
Amount
|
|
Cost
|
|
Fair
Value
(3)
|
||||||
CWS Holding Company, LLC (0%)*
|
|
Manufacturer of Custom Windows and Sliding Doors
|
|
Class A Units (1,500,000 units)
|
|
|
|
$
|
1,500,000
|
|
|
$
|
1,546,000
|
|
||
|
|
|
|
|
1,500,000
|
|
|
1,546,000
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Data Source Holdings, LLC (0%)*
|
|
Print Supply Chain Management Services
|
|
Common Units (47,503 units)
|
|
|
|
1,000,000
|
|
|
813,000
|
|
||||
|
|
|
|
|
1,000,000
|
|
|
813,000
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Del Real, LLC (3%)*
|
|
Hispanic Refrigerated Foods Company
|
|
Subordinated Note (11% Cash, Due 04/23)
|
|
$
|
14,000,000
|
|
|
13,759,702
|
|
|
13,759,702
|
|
||
|
|
Class A Units (3,000,000 units)
|
|
|
|
3,000,000
|
|
|
3,368,000
|
|
||||||
|
|
|
|
14,000,000
|
|
|
16,759,702
|
|
|
17,127,702
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Deva Holdings, Inc. (5%)*
|
|
Hair Products
|
|
Senior Note (LIBOR + 6.75%, 8.1% Cash, Due 10/23)
(8)
|
|
32,500,000
|
|
|
31,823,379
|
|
|
31,823,379
|
|
|||
|
|
|
|
32,500,000
|
|
|
31,823,379
|
|
|
31,823,379
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Dimora Brands, Inc. (3%)*
|
|
Hardware Designer and Distributor
|
|
Second Lien Term Note (LIBOR + 8.5%, 9.9% Cash, Due 08/25)
(8)
|
|
20,000,000
|
|
|
19,608,400
|
|
|
19,615,000
|
|
|||
|
|
|
|
20,000,000
|
|
|
19,608,400
|
|
|
19,615,000
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
DLC Acquisition, LLC (6%)*
|
|
Staffing Firm
|
|
Senior Notes (LIBOR + 8.0%, 10% Cash, Due 12/20)
(8)
|
|
21,706,250
|
|
|
21,539,521
|
|
|
21,539,521
|
|
|||
|
Senior Note (10% Cash, 2% PIK, Due 12/20)
|
|
17,275,680
|
|
|
17,123,271
|
|
|
17,123,271
|
|
||||||
|
|
|
38,981,930
|
|
|
38,662,792
|
|
|
38,662,792
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Dyno Acquiror, Inc. (1%)*
|
|
Sewing Products and Seasonal Decorative Products Supplier
|
|
Subordinated Note (10.5% Cash, 1.5% PIK, Due 08/20)
|
|
4,663,527
|
|
|
4,646,697
|
|
|
4,646,697
|
|
|||
|
Series A Units (600,000 units)
|
|
|
|
600,000
|
|
|
504,000
|
|
|||||||
|
|
|
4,663,527
|
|
|
5,246,697
|
|
|
5,150,697
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Eckler's Holdings, Inc. (0%)*
|
|
Restoration Parts and Accessories for Classic Cars and Trucks
|
|
Subordinated Note (17.5% Cash, Due 06/19)
(6)
|
|
14,385,439
|
|
|
13,242,814
|
|
|
—
|
|
|||
|
Common Stock (18,029 shares)
|
|
|
|
183,562
|
|
|
—
|
|
|||||||
|
Series A Preferred Stock (1,596 shares)
|
|
|
|
1,596,126
|
|
|
—
|
|
|||||||
|
Series B Preferred Stock (702 shares)
|
|
|
|
435,127
|
|
|
—
|
|
|||||||
|
|
|
14,385,439
|
|
|
15,457,629
|
|
|
—
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Frozen Specialties, Inc. (2%)*
|
|
Frozen Foods Manufacturer
|
|
Subordinated Note (10% Cash, 4% PIK, Due 05/18)
|
|
14,238,457
|
|
|
14,238,457
|
|
|
14,238,457
|
|
|||
|
|
14,238,457
|
|
|
14,238,457
|
|
|
14,238,457
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
GST AutoLeather, Inc. (0%)*
|
|
Supplier of Automotive Interior Leather
|
|
Subordinated Note (0% Cash, Due 01/21)
(6)
|
|
24,166,324
|
|
|
23,073,507
|
|
|
200,000
|
|
|||
|
|
|
|
24,166,324
|
|
|
23,073,507
|
|
|
200,000
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Halo Branded Solutions, Inc. (3%)*
|
|
Promotional Product Supply Chain Services
|
|
Subordinated Notes (11% Cash, 1% PIK, Due 10/22)
|
|
13,766,530
|
|
|
13,543,628
|
|
|
13,543,628
|
|
|||
|
|
Class A1 Units (2,600 units)
|
|
|
|
2,600,000
|
|
|
5,857,000
|
|
||||||
|
|
|
|
13,766,530
|
|
|
16,143,628
|
|
|
19,400,628
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
HemaSource, Inc. (2%)*
|
|
Medical Products Distributor
|
|
Subordinated Note (9.5% Cash, 1.5% PIK, Due 01/24)
|
|
10,069,284
|
|
|
9,880,715
|
|
|
9,880,715
|
|
|||
|
|
Class A Units (1,000,000 units)
|
|
|
|
1,000,000
|
|
|
1,023,000
|
|
||||||
|
|
|
|
10,069,284
|
|
|
10,880,715
|
|
|
10,903,715
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
HKW Capital Partners IV, L.P.
(0%)*
(4)
|
|
Multi-Sector Holdings
|
|
0.6% Limited Partnership Interest
|
|
|
|
894,476
|
|
|
1,671,000
|
|
||||
|
|
|
|
|
|
894,476
|
|
|
1,671,000
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
HTC Borrower, LLC (4%)*
|
|
Hunting and Outdoor Products
|
|
Subordinated Notes (10% Cash, 3% PIK, Due 09/20)
|
|
26,935,658
|
|
|
26,722,850
|
|
|
25,759,000
|
|
|||
|
|
|
|
26,935,658
|
|
|
26,722,850
|
|
|
25,759,000
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
ICP Industrial, Inc. (3%)*
|
|
Coatings Formulator and Manufacturer
|
|
Second Lien Term Notes (LIBOR + 8.25%, 9.6% Cash, Due 05/24)
(8)
|
|
20,000,000
|
|
|
19,392,800
|
|
|
19,392,800
|
|
|||
|
|
Class A Units (1,289 units)
|
|
|
|
1,751,483
|
|
|
1,650,000
|
|
||||||
|
|
|
|
20,000,000
|
|
|
21,144,283
|
|
|
21,042,800
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
IDERA, Inc. (2%)*
|
|
Software Provider
|
|
Second Lien Term Note (LIBOR + 9.0%, 10.4% Cash, Due 06/25)
(8)
|
|
10,000,000
|
|
|
9,856,308
|
|
|
9,866,000
|
|
|||
|
|
|
|
10,000,000
|
|
|
9,856,308
|
|
|
9,866,000
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Inland Pipe Rehabilitation Holding Company LLC (0%)*
|
|
Cleaning and Repair Services
|
|
Membership Interest Purchase Warrant (3%)
|
|
|
|
853,500
|
|
|
1,101,000
|
|
||||
|
|
|
|
853,500
|
|
|
1,101,000
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
TRIANGLE CAPITAL CORPORATION
Consolidated Schedule of Investments — (Continued)
December 31, 2017
|
||||||||||||||||
Portfolio Company
|
|
Industry
|
|
Type of Investment
(1)(2)(7)
|
|
Principal
Amount
|
|
Cost
|
|
Fair
Value
(3)
|
||||||
Integrated Efficiency Solutions, Inc. (3%)*
|
|
Energy Services Contracting Firm
|
|
Senior Secured Term Note (LIBOR + 9.25%, 10.6% Cash, Due 06/22)
(8)
|
|
$
|
18,268,750
|
|
|
$
|
17,970,511
|
|
|
$
|
17,970,511
|
|
Series B Preferred Units (238,095 units)
|
|
|
|
300,000
|
|
|
243,000
|
|
||||||||
|
|
18,268,750
|
|
|
18,270,511
|
|
|
18,213,511
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Keystone Peer Review Organization, Inc. (0%)*
|
|
Healthcare - Managed Care
|
|
Second Lien Term Note (LIBOR + 9.25%, 10.6% Cash, Due 05/25)
(8)
|
|
3,000,000
|
|
|
2,943,794
|
|
|
2,922,000
|
|
|||
|
|
|
|
3,000,000
|
|
|
2,943,794
|
|
|
2,922,000
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
KidKraft, Inc. (4%)*
|
|
Children's Toy Manufacturer and Distributor
|
|
Second Lien Term Note (11% Cash, 1% PIK, Due 03/22)
|
|
27,945,580
|
|
|
27,491,811
|
|
|
27,491,811
|
|
|||
|
|
|
|
27,945,580
|
|
|
27,491,811
|
|
|
27,491,811
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
K-Square Restaurant Partners, LP (0%)*
|
|
Restaurant
|
|
Class A Units of Limited Partnership (2,000 units)
|
|
|
|
638,260
|
|
|
1,588,000
|
|
||||
|
|
|
|
|
|
638,260
|
|
|
1,588,000
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Lakeview Health Holdings, Inc. (3%)*
|
|
Substance Abuse Treatment Service Provider
|
|
Senior Note (LIBOR + 7.0%, 8.5% Cash, Due 12/21)
(8)
|
|
18,426,505
|
|
|
18,260,612
|
|
|
17,916,000
|
|
|||
|
|
Common Stock (2,000 shares)
|
|
|
|
2,000,000
|
|
|
853,000
|
|
||||||
|
|
|
|
18,426,505
|
|
|
20,260,612
|
|
|
18,769,000
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Media Storm, LLC (0%)*
|
|
Marketing Services
|
|
Subordinated Note (10% Cash, Due 08/19)
(6)
|
|
6,876,818
|
|
|
6,541,519
|
|
|
1,617,000
|
|
|||
Membership Units (1,216,204 units)
|
|
|
|
1,176,957
|
|
|
—
|
|
||||||||
|
|
6,876,818
|
|
|
7,718,476
|
|
|
1,617,000
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
MIC Holding LLC (1%)*
|
|
Firearm Accessories Manufacturer and Distributor
|
|
Preferred Units (1,470 units)
|
|
|
|
1,470,000
|
|
|
3,449,000
|
|
||||
|
|
Common Units (30,000 units)
|
|
|
|
30,000
|
|
|
4,918,000
|
|
||||||
|
|
|
|
|
|
1,500,000
|
|
|
8,367,000
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Micross Solutions LLC (3%)*
|
|
Provider of Semiconductor Products and Services
|
|
Senior Note (LIBOR + 5.5%, 6.8% Cash,
Due 08/23)
(8)
|
|
14,962,500
|
|
|
14,788,973
|
|
|
14,788,973
|
|
|||
Class A-2 Common Units (1,979,524 units)
|
|
|
|
2,019,693
|
|
|
1,571,000
|
|
||||||||
|
|
14,962,500
|
|
|
16,808,666
|
|
|
16,359,973
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Nautic Partners VII, LP (0%)*
(4)
|
|
Multi-Sector Holdings
|
|
0.4% Limited Partnership Interest
|
|
|
|
907,332
|
|
|
1,175,000
|
|
||||
|
|
|
|
|
|
907,332
|
|
|
1,175,000
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Navicure, Inc. (1%)*
|
|
Healthcare Revenue Cycle Management Software
|
|
Second Lien Term Note (LIBOR + 7.5%, 8.9% Cash, Due 11/25)
(8)
|
|
6,000,000
|
|
|
5,941,328
|
|
|
5,941,328
|
|
|||
|
|
|
|
6,000,000
|
|
|
5,941,328
|
|
|
5,941,328
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Nomacorc, LLC (4%)*
|
|
Synthetic Wine Cork Producer
|
|
Subordinated Note (10% Cash, 2.3% PIK, Due 07/21)
|
|
21,356,210
|
|
|
21,109,445
|
|
|
21,109,445
|
|
|||
|
|
Limited Partnership Interest
|
|
|
|
2,161,185
|
|
|
1,438,000
|
|
||||||
|
|
|
|
21,356,210
|
|
|
23,270,630
|
|
|
22,547,445
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
OEConnection, LLC (0%)*
|
|
Automotive Parts Supply Chain Software
|
|
Second Lien Term Note (LIBOR + 8.0%, 9.3% Cash, Due 11/25)
(8)
|
|
3,000,000
|
|
|
2,970,000
|
|
|
2,970,000
|
|
|||
|
|
|
|
3,000,000
|
|
|
2,970,000
|
|
|
2,970,000
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Orchid Underwriters Agency, LLC (1%)*
|
|
Insurance Underwriter
|
|
Subordinated Note (10% Cash, 1.5% PIK, Due 03/23)
|
|
2,135,226
|
|
|
2,095,654
|
|
|
2,095,654
|
|
|||
Subordinated Note (13.5% PIK, Due 03/24)
|
|
812,457
|
|
|
797,991
|
|
|
797,991
|
|
|||||||
Class A Preferred Units (15,000 units)
|
|
|
|
338,158
|
|
|
957,000
|
|
||||||||
Class A Common Units (15,000 units)
|
|
|
|
—
|
|
|
1,132,000
|
|
||||||||
|
|
2,947,683
|
|
|
3,231,803
|
|
|
4,982,645
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
ProAmpac PG Borrower LLC (2%)*
|
|
Manufacturer of Flexible Packaging Products
|
|
Second Lien Term Note (LIBOR + 8.5%, 9.9% Cash, Due 11/24)
(8)
|
|
15,000,000
|
|
|
14,794,786
|
|
|
14,988,000
|
|
|||
|
|
|
|
15,000,000
|
|
|
14,794,786
|
|
|
14,988,000
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Q International Courier, LLC (2%)*
|
|
Third-Party Logistics Provider
|
|
Second Lien Term Note (LIBOR + 8.25%, 9.7% Cash, Due 09/25)
(8)
|
|
14,000,000
|
|
|
13,725,941
|
|
|
13,725,941
|
|
|||
|
|
|
|
14,000,000
|
|
|
13,725,941
|
|
|
13,725,941
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
REP WWEX Acquisition Parent, LLC (2%)*
|
|
Third-Party Logistics Provider
|
|
Second Lien Term Note (LIBOR + 8.75%, 10.2% Cash, Due 02/25)
(8)
|
|
15,000,000
|
|
|
14,794,594
|
|
|
14,861,000
|
|
|||
|
|
|
|
15,000,000
|
|
|
14,794,594
|
|
|
14,861,000
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
TRIANGLE CAPITAL CORPORATION
Consolidated Schedule of Investments — (Continued)
December 31, 2017
|
||||||||||||||||
Portfolio Company
|
|
Industry
|
|
Type of Investment
(1)(2)(7)
|
|
Principal
Amount
|
|
Cost
|
|
Fair
Value
(3)
|
||||||
RMP Group, Inc. (2%)*
|
|
Healthcare Revenue Cycle Management Services
|
|
Subordinated Note (10.5% Cash, 1% PIK, Due 09/22)
|
|
$
|
10,083,813
|
|
|
$
|
9,904,854
|
|
|
$
|
9,904,854
|
|
|
|
Units (1,000 units)
|
|
|
|
1,000,000
|
|
|
723,000
|
|
||||||
|
|
|
|
10,083,813
|
|
|
10,904,854
|
|
|
10,627,854
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
RockYou, Inc. (0%)*
|
|
Mobile Game Advertising Network
|
|
Common Stock (67,585 shares)
|
|
|
|
111,000
|
|
|
111,000
|
|
||||
|
|
|
|
|
|
111,000
|
|
|
111,000
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Rotolo Consultants, Inc. (3%)*
|
|
Landscape Services
|
|
Subordinated Note (11% Cash, 3% PIK, Due 08/21)
|
|
7,632,930
|
|
|
7,531,194
|
|
|
7,531,194
|
|
|||
|
|
Series A Preferred Units (39 units)
|
|
|
|
3,654,253
|
|
|
8,504,000
|
|
||||||
|
|
|
|
7,632,930
|
|
|
11,185,447
|
|
|
16,035,194
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
SCA Pharmaceuticals, LLC (2%)*
|
|
Provider of Pharmaceutical Products
|
|
Subordinated Note (LIBOR + 9.0%, 10.5% Cash, Due 12/20)
(8)
|
|
10,000,000
|
|
|
9,832,455
|
|
|
9,832,455
|
|
|||
|
|
|
|
10,000,000
|
|
|
9,832,455
|
|
|
9,832,455
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Schweiger Dermatology Group, LLC (4%)*
|
|
Provider of Dermatology Services
|
|
Senior Notes (LIBOR + 8.5%, 10.0% Cash,
Due 06/22)
(8)
|
|
25,500,000
|
|
|
25,113,677
|
|
|
25,113,677
|
|
|||
|
|
Class A-5 Units (1,976,284 units)
|
|
|
|
1,000,000
|
|
|
1,000,000
|
|
||||||
|
|
|
|
25,500,000
|
|
|
26,113,677
|
|
|
26,113,677
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
SCUF Gaming, Inc. (4%)*
|
|
Gaming Controller Manufacturer
|
|
Senior Notes (LIBOR + 8.5%, 9.9% Cash,
Due 12/21)
(8)
|
|
24,757,920
|
|
|
24,339,939
|
|
|
24,339,939
|
|
|||
|
|
Revolver Loan (LIBOR + 8.5%, 9.9% Cash,
Due 06/18)
(8)
|
|
1,500,000
|
|
|
1,487,760
|
|
|
1,487,760
|
|
|||||
|
|
Common Stock (27,112 shares)
|
|
|
|
742,000
|
|
|
378,000
|
|
||||||
|
|
|
|
26,257,920
|
|
|
26,569,699
|
|
|
26,205,699
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Smile Brands, Inc. (4%)*
|
|
Dental Service Organization
|
|
Subordinated Notes (10% Cash, 2% PIK, Due 02/23)
|
|
22,796,512
|
|
|
22,417,773
|
|
|
22,417,773
|
|
|||
|
|
Class A Units (3,000 units)
|
|
|
|
3,000,000
|
|
|
3,353,000
|
|
||||||
|
|
|
|
22,796,512
|
|
|
25,417,773
|
|
|
25,770,773
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
SPC Partners V, LP (0%)*
(4)
|
|
Multi-Sector Holdings
|
|
0.7% Limited Partnership Interest
|
|
|
|
2,260,450
|
|
|
2,412,000
|
|
||||
|
|
|
|
|
|
2,260,450
|
|
|
2,412,000
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
SPC Partners VI, LP (0%)*
(4)
|
|
Multi-Sector Holdings
|
|
0.6% Limited Partnership Interest
|
|
|
|
207,828
|
|
|
207,828
|
|
||||
|
|
|
|
|
|
207,828
|
|
|
207,828
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Specialized Desanders, Inc. (2%)*
(4)
|
|
Sand and Particulate Removal Equipment Provider for Oil and Gas Companies
|
|
Subordinated Note (11% Cash, 2% PIK, Due 10/20)
|
|
10,117,769
|
|
|
8,692,122
|
|
|
7,451,070
|
|
|||
Class C Partnership Units (2,000,000 units)
|
|
|
|
1,937,421
|
|
|
3,993,000
|
|
||||||||
|
|
|
10,117,769
|
|
|
10,629,543
|
|
|
11,444,070
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
St. Croix Hospice Acquisition Corp. (1%)*
|
|
Hospice Services Provider
|
|
Second Lien Term Note (LIBOR + 8.75%, 10.1% Cash, Due 03/24)
(8)
|
|
9,200,000
|
|
|
9,065,834
|
|
|
9,065,834
|
|
|||
|
|
Series A Preferred Units (500 units)
|
|
|
|
500,000
|
|
|
359,000
|
|
||||||
|
|
Class B Common Units (500 units)
|
|
|
|
—
|
|
|
—
|
|
||||||
|
|
|
|
9,200,000
|
|
|
9,565,834
|
|
|
9,424,834
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Tate's Bake Shop (2%)*
|
|
Producer of Baked Goods
|
|
Senior Note (LIBOR + 6.25%, 7.6% Cash, Due 08/19)
(8)
|
|
9,975,000
|
|
|
9,951,709
|
|
|
9,951,709
|
|
|||
|
|
Limited Partnership Interest
|
|
|
|
534,280
|
|
|
1,845,000
|
|
||||||
|
|
|
|
9,975,000
|
|
|
10,485,989
|
|
|
11,796,709
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Tax Advisors Group, LLC (2%)*
|
|
Tax Advisory Services
|
|
Subordinated Note (10% Cash, 2% PIK, Due 12/22)
|
|
12,400,000
|
|
|
12,169,399
|
|
|
12,169,399
|
|
|||
|
|
Class A Units (386 units)
|
|
|
|
1,458,824
|
|
|
2,295,000
|
|
||||||
|
|
|
|
12,400,000
|
|
|
13,628,223
|
|
|
14,464,399
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
TCFI Merlin LLC ("Merlin") and TCFI CSG LLC ("CSG") (2%)*
|
|
Specialty Staffing Service Provider
|
|
Subordinated Notes (11.6% Cash, Due 09/19)
(8)
|
|
14,184,192
|
|
|
13,970,730
|
|
|
13,970,730
|
|
|||
|
|
Limited Partnership Units - Merlin (500,500 units)
|
|
|
|
285,485
|
|
|
1,595,000
|
|
||||||
|
|
Class A Units - CSG (100,000 units)
|
|
|
|
100,000
|
|
|
230,000
|
|
||||||
|
|
|
|
14,184,192
|
|
|
14,356,215
|
|
|
15,795,730
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
The Cook & Boardman Group, LLC (1%)*
|
|
Distributor of Doors and Related Products
|
|
Class A Units (1,400,000 units)
|
|
|
|
1,400,000
|
|
|
3,490,000
|
|
||||
|
|
|
|
|
|
1,400,000
|
|
|
3,490,000
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
TRIANGLE CAPITAL CORPORATION
Consolidated Schedule of Investments — (Continued)
December 31, 2017
|
||||||||||||||||
Portfolio Company
|
|
Industry
|
|
Type of Investment
(1)(2)(7)
|
|
Principal
Amount
|
|
Cost
|
|
Fair
Value
(3)
|
||||||
Trademark Global LLC (3%)*
|
|
Supplier to Mass Market Internet Retail
|
|
Subordinated Note (10% Cash, 1.3% PIK, Due 04/23)
|
|
$
|
14,800,000
|
|
|
$
|
14,610,405
|
|
|
$
|
14,610,405
|
|
|
|
Class A Units (1,500,000 units)
|
|
|
|
1,500,000
|
|
|
1,500,000
|
|
||||||
|
|
Class B Units (1,500,000 units)
|
|
|
|
—
|
|
|
894,000
|
|
||||||
|
|
|
|
14,800,000
|
|
|
16,110,405
|
|
|
17,004,405
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Travelpro Products, Inc. ("Travelpro") and TP - Holiday Group Limited ("TP") (3%)*
|
|
Luggage and Travel Bag Supplier
|
|
Second Lien Term Note - Travelpro (11% Cash, 2% PIK, Due 11/22)
|
|
10,332,955
|
|
|
10,153,881
|
|
|
10,153,881
|
|
|||
|
|
Second Lien Term Note - TP (11% Cash, 2% PIK, Due 11/22)
(4)
|
|
9,152,950
|
|
|
8,991,783
|
|
|
9,403,477
|
|
|||||
|
|
Common Units - Travelpro (2,000,000 units)
|
|
|
|
2,000,000
|
|
|
2,270,000
|
|
||||||
|
|
|
|
19,485,905
|
|
|
21,145,664
|
|
|
21,827,358
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
United Biologics, LLC (2%)*
|
|
Allergy Immunotherapy
|
|
Senior Note (12% Cash, 2% PIK, Due 04/18)
|
|
13,022,543
|
|
|
13,022,542
|
|
|
13,022,542
|
|
|||
|
Class A-1 Common Units (18,818 units)
|
|
|
|
137,324
|
|
|
137,325
|
|
|||||||
|
Class A Common Units (177,935 units)
|
|
|
|
1,999,989
|
|
|
1,351,000
|
|
|||||||
|
Class A-2 Common Kicker Units (444,003 units)
|
|
|
|
—
|
|
|
—
|
|
|||||||
|
Class A-1 Common Kicker Units (14,114 units)
|
|
|
|
—
|
|
|
—
|
|
|||||||
|
Class A, Class A-1, Class A-1 Kicker & Class B Unit Purchase Warrants
|
|
|
|
838,117
|
|
|
288,000
|
|
|||||||
|
|
|
|
13,022,543
|
|
|
15,997,972
|
|
|
14,798,867
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Vantage Mobility International, LLC (5%)*
|
|
Wheelchair Accessible Vehicle Manufacturer
|
|
Subordinated Notes (10.6% Cash, Due 09/21)
(8)
|
|
30,708,796
|
|
|
30,216,432
|
|
|
30,216,432
|
|
|||
|
|
Class A Units (1,750,000 units)
|
|
|
|
1,750,000
|
|
|
719,000
|
|
||||||
|
|
|
|
30,708,796
|
|
|
31,966,432
|
|
|
30,935,432
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Wheel Pros Holdings, Inc. (3%)*
|
|
Wheel/Rim and Performance Tire Distributor
|
|
Subordinated Note (LIBOR + 7.0%, 11% Cash, Due 06/20)
(8)
|
|
16,435,000
|
|
|
16,217,360
|
|
|
16,217,360
|
|
|||
|
|
Class A Units (2,000 units)
|
|
|
|
1,954,144
|
|
|
3,508,000
|
|
||||||
|
|
|
|
16,435,000
|
|
|
18,171,504
|
|
|
19,725,360
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Women's Marketing, Inc. (0%)*
|
|
Full-Service Media Organization
|
|
Subordinated Note (11% Cash, 1.5% PIK, Due 06/21)
(6)
|
|
19,136,331
|
|
|
16,141,439
|
|
|
—
|
|
|||
|
|
Class A Common Units (16,300 units)
|
|
|
|
1,630,000
|
|
|
—
|
|
||||||
|
|
|
|
19,136,331
|
|
|
17,771,439
|
|
|
—
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
WSO Holdings, LP (0%)*
|
|
Organic/Fair Trade Sugar, Syrup, Nectar and Honey Producer
|
|
Common Points (3,121 points)
|
|
|
|
3,089,581
|
|
|
2,612,000
|
|
||||
|
|
|
|
|
3,089,581
|
|
|
2,612,000
|
|
|||||||
|
|
|
|
|
|
|
||||||||||
YummyEarth Inc. (4%)*
|
|
Organic Candy Manufacturer
|
|
Senior Notes (LIBOR + 8.5%, 10.0% Cash,
Due 08/20)
(8)
|
|
31,250,000
|
|
|
30,965,913
|
|
|
26,196,000
|
|
|||
|
|
Limited Partnership Interest
|
|
|
|
3,496,500
|
|
|
—
|
|
||||||
|
|
|
|
31,250,000
|
|
|
34,462,413
|
|
|
26,196,000
|
|
|||||
|
|
|
|
|
|
|
||||||||||
Subtotal Non–Control / Non–Affiliate Investments
|
|
856,289,518
|
|
|
910,150,765
|
|
|
831,194,397
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Affiliate Investments:
|
|
|
|
|
|
|
|
|
|
|
||||||
All Metals Holding, LLC (1%)*
|
|
Steel Processor and Distributor
|
|
Subordinated Note (12% Cash, 1% PIK, Due 12/21)
|
|
6,434,351
|
|
|
6,278,902
|
|
|
6,434,000
|
|
|||
|
|
Units (318,977 units)
|
|
|
|
793,331
|
|
|
266,000
|
|
||||||
|
|
|
|
6,434,351
|
|
|
7,072,233
|
|
|
6,700,000
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Consolidated Lumber Holdings, LLC (1%)*
|
|
Lumber Yard Operator
|
|
Class A Units (15,000 units)
|
|
|
|
1,500,000
|
|
|
4,500,000
|
|
||||
|
|
|
|
|
|
1,500,000
|
|
|
4,500,000
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
FCL Holding SPV, LLC (0%)*
|
|
Commercial Printing Services
|
|
Class A Interest (24,873 units)
|
|
|
|
292,000
|
|
|
570,000
|
|
||||
|
|
Class B Interest (48,427 units)
|
|
|
|
—
|
|
|
—
|
|
||||||
|
|
Class C Interest (3,746 units)
|
|
|
|
—
|
|
|
—
|
|
||||||
|
|
|
|
|
|
292,000
|
|
|
570,000
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Mac Land Holdings, Inc. (0%)*
|
|
Environmental and Facilities Services
|
|
Common Stock (139 shares)
|
|
|
|
369,000
|
|
|
—
|
|
||||
|
|
|
|
|
|
369,000
|
|
|
—
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
TRIANGLE CAPITAL CORPORATION
Consolidated Schedule of Investments — (Continued)
December 31, 2017
|
||||||||||||||||
Portfolio Company
|
|
Industry
|
|
Type of Investment
(1)(2)(7)
|
|
Principal
Amount
|
|
Cost
|
|
Fair
Value
(3)
|
||||||
NB Products, Inc. (9%)*
|
|
Distributor of Work Apparel and Accessories
|
|
Subordinated Note (12% Cash, 2% PIK, Due 02/20)
|
|
$
|
23,570,899
|
|
|
$
|
23,308,085
|
|
|
$
|
23,308,085
|
|
|
Jr. Subordinated Note (10% PIK, Due 02/20)
|
|
5,194,357
|
|
|
5,114,592
|
|
|
5,114,592
|
|
||||||
|
Jr. Subordinated Bridge Note (20% PIK, Due 05/21)
|
|
2,434,156
|
|
|
2,412,295
|
|
|
2,412,295
|
|
||||||
|
Series A Redeemable Senior Preferred Stock (7,839 shares)
|
|
|
|
7,621,648
|
|
|
10,390,000
|
|
|||||||
|
Common Stock (1,668,691 shares)
|
|
|
|
333,738
|
|
|
16,044,000
|
|
|||||||
|
|
|
31,199,412
|
|
|
38,790,358
|
|
|
57,268,972
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Passport Food Group, LLC (3%)*
|
|
Manufacturer of Ethnic Food Products
|
|
Senior Notes (LIBOR + 9.0%, 10.3% Cash,
Due 03/22)
(8)
|
|
20,000,000
|
|
|
19,648,160
|
|
|
16,672,000
|
|
|||
|
|
Common Stock (20,000 shares)
|
|
|
|
2,000,000
|
|
|
357,000
|
|
||||||
|
|
|
|
20,000,000
|
|
|
21,648,160
|
|
|
17,029,000
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
PCX Aerostructures, LLC (4%)*
|
|
Aerospace Components Manufacturer
|
|
Subordinated Note (10.5% Cash, Due 10/19)
(9)
|
|
31,647,359
|
|
|
31,244,000
|
|
|
22,574,000
|
|
|||
|
Subordinated Note (6% PIK, Due 10/20)
(9)
|
|
759,286
|
|
|
759,286
|
|
|
548,000
|
|
||||||
|
Series A Preferred Stock (6,066 shares)
|
|
|
|
6,065,621
|
|
|
—
|
|
|||||||
Series B Preferred Stock (411 shares)
|
|
|
|
410,514
|
|
|
—
|
|
||||||||
Class A Common Stock (121,922 shares)
|
|
|
|
30,480
|
|
|
—
|
|
||||||||
|
|
|
32,406,645
|
|
|
38,509,901
|
|
|
23,122,000
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Team Waste, LLC (2%)*
|
|
Environmental and Facilities Services
|
|
Subordinated Note (10% Cash, 2% PIK, Due 08/23)
|
|
5,028,180
|
|
|
4,930,962
|
|
|
4,930,962
|
|
|||
|
|
Preferred Units (500,000 units)
|
|
|
|
10,000,000
|
|
|
10,000,000
|
|
||||||
|
|
|
|
5,028,180
|
|
|
14,930,962
|
|
|
14,930,962
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Technology Crops, LLC (1%)*
|
|
Supply Chain Management Services
|
|
Subordinated Notes (12% Cash, Due 02/18)
|
|
12,294,102
|
|
|
12,294,102
|
|
|
8,617,000
|
|
|||
Common Units (50 units)
|
|
|
|
500,000
|
|
|
—
|
|
||||||||
|
|
|
12,294,102
|
|
|
12,794,102
|
|
|
8,617,000
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
TGaS Advisors, LLC (2%)*
|
|
Advisory Solutions to Pharmaceutical Companies
|
|
Senior Note (10% Cash, 1% PIK, Due 11/19)
|
|
9,522,893
|
|
|
9,431,015
|
|
|
9,431,015
|
|
|||
|
Preferred Units (1,685,357 units)
|
|
|
|
1,556,069
|
|
|
1,524,000
|
|
|||||||
|
|
|
9,522,893
|
|
|
10,987,084
|
|
|
10,955,015
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Tulcan Fund IV, L.P. (0%)*
|
|
Custom Forging and Fastener Supplies
|
|
Common Units (1,000,000 units)
|
|
|
|
1,000,000
|
|
|
—
|
|
||||
|
|
|
|
|
|
1,000,000
|
|
|
—
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
United Retirement Plan Consultants, Inc. (0%)*
|
|
Retirement Plan Administrator
|
|
Series A Preferred Shares (9,400 shares)
|
|
|
|
205,748
|
|
|
302,000
|
|
||||
|
|
Common Shares (100,000 shares)
|
|
|
|
1,000,000
|
|
|
419,000
|
|
||||||
|
|
|
|
|
|
1,205,748
|
|
|
721,000
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Wythe Will Tzetzo, LLC (0%)*
|
|
Confectionery Goods Distributor
|
|
Series A Preferred Units (99,829 units)
|
|
|
|
—
|
|
|
2,688,000
|
|
||||
|
|
|
|
|
|
—
|
|
|
2,688,000
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Subtotal Affiliate Investments
|
|
|
|
116,885,583
|
|
|
149,099,548
|
|
|
147,101,949
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Control Investments:
|
|
|
|
|
|
|
|
|
|
|
||||||
CRS-SPV, Inc. (3%)*
|
|
Fluid
Reprocessing Services |
|
Common Stock (1,100 shares)
|
|
|
|
18,428,000
|
|
|
20,283,000
|
|
||||
|
|
|
|
|
|
|
18,428,000
|
|
|
20,283,000
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Frank Entertainment Group, LLC
(1%)* |
|
Movie Theatre and Family Entertainment Operator
|
|
Senior Note (6% Cash, Due 06/19)
(6)
|
|
11,330,010
|
|
|
10,746,494
|
|
|
6,541,000
|
|
|||
|
|
Second Lien Term Note (2.5% Cash, Due 09/19)
(6)
|
|
2,923,484
|
|
|
2,879,479
|
|
|
—
|
|
|||||
|
|
Redeemable Preferred Units (2,800,000 units)
|
|
|
|
2,800,000
|
|
|
—
|
|
||||||
|
|
Class B Redeemable Preferred Units (2,800,000 units)
|
|
|
|
2,800,000
|
|
|
—
|
|
||||||
|
|
Class A Common Units (606,552 units)
|
|
|
|
1,000,000
|
|
|
—
|
|
||||||
|
|
|
|
14,253,494
|
|
|
20,225,973
|
|
|
6,541,000
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
FrontStream Holdings, LLC (1%)*
|
|
Payment and Donation Management Product Service Provider
|
|
Subordinated Note (LIBOR + 6.0%, 7.3% Cash, Due 12/20)
(6)(8)
|
|
14,644,622
|
|
|
14,023,389
|
|
|
7,414,000
|
|
|||
|
|
Common Stock (1,000 shares)
|
|
|
|
500,000
|
|
|
—
|
|
||||||
|
|
|
|
14,644,622
|
|
|
14,523,389
|
|
|
7,414,000
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
TRIANGLE CAPITAL CORPORATION
Consolidated Schedule of Investments — (Continued)
December 31, 2017
|
||||||||||||||||
Portfolio Company
|
|
Industry
|
|
Type of Investment
(1)(2)(7)
|
|
Principal
Amount
|
|
Cost
|
|
Fair
Value
(3)
|
||||||
Frontstreet Facility Solutions, Inc. (1%)*
|
|
Retail, Restaurant and Commercial Facilities Maintenance
|
|
Subordinated Note (13% Cash, Due 03/21)
|
|
$
|
8,462,629
|
|
|
$
|
8,447,172
|
|
|
$
|
3,750,000
|
|
|
|
Series A Convertible Preferred Stock (60,000 shares)
|
|
|
|
250,575
|
|
|
—
|
|
||||||
|
|
Series B Convertible Preferred Stock (20,000 shares)
|
|
|
|
500,144
|
|
|
—
|
|
||||||
|
|
Common Stock (27,890 shares)
|
|
|
|
279
|
|
|
—
|
|
||||||
|
|
|
|
8,462,629
|
|
|
9,198,170
|
|
|
3,750,000
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Subtotal Control Investments
|
|
|
|
37,360,745
|
|
|
62,375,532
|
|
|
37,988,000
|
|
|||||
|
|
|
|
|
|
|
|
|
||||||||
Total Investments, December 31, 2017 (158%)*
|
|
|
|
$
|
1,010,535,846
|
|
|
$
|
1,121,625,845
|
|
|
$
|
1,016,284,346
|
|
(1)
|
All debt investments are income producing, unless otherwise noted. Equity and equity-linked investments are non-income producing, unless otherwise noted. The fair values of all investments were determined using significant unobservable inputs.
|
(2)
|
Disclosures of interest rates on notes include cash interest rates and payment-in-kind (“PIK”) interest rates.
|
(3)
|
All investments are restricted as to resale and were valued at fair value as determined in good faith by the Board of Directors.
|
(4)
|
Investment is not a qualifying investment as defined under Section 55(a) of the Investment Company Act of 1940, as amended. Non-qualifying assets represent 2.6% of total investments at fair value as of
December 31, 2017
. Qualifying assets must represent at least 70% of total assets at the time of acquisition of any additional non-qualifying assets. If at any time qualifying assets do not represent at least 70% of the Company's total assets, the Company will be precluded from acquiring any additional non-qualifying asset until such time as it complies with the requirements of Section 55(a).
|
(5)
|
PIK non-accrual investment
|
(6)
|
Non-accrual investment
|
(7)
|
All of the Company's investments, unless otherwise noted, are encumbered either as security for the Company's senior secured credit facility or in support of the SBA-guaranteed debentures issued by Triangle Mezzanine Fund LLLP and Triangle Mezzanine Fund II LP.
|
(8)
|
Index-based floating interest rate is subject to contractual minimum interest rate. A majority of the variable rate loans in the Company's investment portfolio bear interest at a rate that may be determined by reference to either LIBOR or an alternate Base Rate (commonly based on the Federal Funds Rate or the Prime Rate), which typically resets semi-annually, quarterly, or monthly at the borrower's option. The borrower may also elect to have multiple interest reset periods for each loan.
|
(9)
|
Effective February 9, 2018, the Company's debt investments in PCX Aerostructures, LLC were amended to provide for cash interest at all-in rate of 6% per annum.
|
TRIANGLE CAPITAL CORPORATION
Consolidated Schedule of Investments
December 31, 2016
|
||||||||||||||||
Portfolio Company
|
|
Industry
|
|
Type of Investment
(1)(2)(7)
|
|
Principal
Amount
|
|
Cost
|
|
Fair
Value
(3)
|
||||||
Non–Control / Non–Affiliate Investments:
|
|
|
|
|
|
|
||||||||||
ACA Holdings LLC (0%)*
|
|
Security Company
|
|
Preferred Units (2,000,000 units)
|
|
|
|
$
|
2,000,000
|
|
|
$
|
1,242,000
|
|
||
|
|
|
|
|
|
2,000,000
|
|
|
1,242,000
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Access Medical Acquisition, Inc. (3%)*
|
|
Operator of Primary Care Clinics
|
|
Subordinated Notes (10% Cash, 2% PIK, Due 01/22)
|
|
$
|
13,819,514
|
|
|
13,593,292
|
|
|
13,593,292
|
|
||
|
|
Class A Units (1,500,000 units)
|
|
|
|
901,026
|
|
|
3,618,000
|
|
||||||
|
|
|
|
13,819,514
|
|
|
14,494,318
|
|
|
17,211,292
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Aden & Anais Holdings, Inc. (0%)*
|
|
Baby Products
|
|
Common Stock (20,000 shares)
|
|
|
|
2,000,000
|
|
|
2,000,000
|
|
||||
|
|
|
|
|
|
2,000,000
|
|
|
2,000,000
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Agilex Flavors & Fragrances, Inc. (2%)*
|
|
Custom Fragrance Producer
|
|
Subordinated Note (12% Cash, Due 11/21)
|
|
13,168,124
|
|
|
13,048,983
|
|
|
13,048,983
|
|
|||
Common Units (1,250 units)
|
|
|
|
1,250,000
|
|
|
2,227,000
|
|
||||||||
|
|
|
13,168,124
|
|
|
14,298,983
|
|
|
15,275,983
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
AGM Automotive, LLC (1%)*
|
|
Auto Industry Interior Components Supplier
|
|
Units (1,500,000 units)
|
|
|
|
630,134
|
|
|
4,266,000
|
|
||||
|
|
|
|
|
630,134
|
|
|
4,266,000
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Avkem International, LLC (1%)*
|
|
Flux and Foundry Manufacturer and Supplier
|
|
Subordinated Note (10% Cash, 4% PIK, Due 12/17)
|
|
4,112,935
|
|
|
4,075,177
|
|
|
4,075,177
|
|
|||
|
|
|
|
4,112,935
|
|
|
4,075,177
|
|
|
4,075,177
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
AVL Holdings, Inc. (0%)*
|
|
Manufacturer and Distributor for Independent Artists and Authors
|
|
Common Stock (138 shares)
|
|
|
|
1,300,000
|
|
|
1,767,000
|
|
||||
|
|
|
|
|
|
1,300,000
|
|
|
1,767,000
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Baker Hill Acquisition, LLC (2%)*
|
|
Loan Origination Software Solutions Provider
|
|
Subordinated Notes (LIBOR + 11.0%, 12% Cash, Due 03/21)
(8)
|
|
13,500,000
|
|
|
13,334,260
|
|
|
12,320,000
|
|
|||
|
|
Limited Partnership Interest
|
|
|
|
1,498,500
|
|
|
721,000
|
|
||||||
|
|
|
|
13,500,000
|
|
|
14,832,760
|
|
|
13,041,000
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Cafe Enterprises, Inc. (2%)*
|
|
Restaurant
|
|
Subordinated Note (7% Cash, 7% PIK, Due 09/19)
|
|
13,882,800
|
|
|
13,743,461
|
|
|
10,331,000
|
|
|||
|
|
Series C Preferred Stock (10,000 shares)
|
|
|
|
1,000,000
|
|
|
—
|
|
||||||
|
|
|
|
13,882,800
|
|
|
14,743,461
|
|
|
10,331,000
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Capital Contractors, Inc. (0%)*
|
|
Janitorial and Facilities Maintenance Services
|
|
Subordinated Notes (5% Cash, Due 06/20)
|
|
9,843,542
|
|
|
9,711,658
|
|
|
—
|
|
|||
Series A Redeemable Preferred Stock (200 shares)
|
|
|
|
2,000,000
|
|
|
—
|
|
||||||||
Common Stock Warrants (20 shares)
|
|
|
|
492,000
|
|
|
—
|
|
||||||||
|
|
9,843,542
|
|
|
12,203,658
|
|
|
—
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Captek Softgel International, Inc.
(3%)*
|
|
Nutraceutical Manufacturer
|
|
Subordinated Note (10% Cash, 2.5% PIK, Due 06/21)
|
|
15,407,336
|
|
|
15,150,497
|
|
|
15,150,497
|
|
|||
Common Stock (15,000 shares)
|
|
|
|
1,500,000
|
|
|
1,500,000
|
|
||||||||
|
|
|
15,407,336
|
|
|
16,650,497
|
|
|
16,650,497
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Carolina Beverage Group, LLC (0%)*
|
|
Beverage Manufacturing
and Packaging |
|
Class B Units (11,974 units)
|
|
|
|
119,735
|
|
|
264,000
|
|
||||
|
|
|
|
|
119,735
|
|
|
264,000
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Centerfield Media Holding Company (4%)*
|
|
Digital Marketing
|
|
Subordinated Note (10% Cash, 3.5% PIK, Due 03/21)
|
|
18,857,978
|
|
|
18,567,590
|
|
|
19,235,000
|
|
|||
|
|
Common Shares (1,000 shares)
|
|
|
|
1,000,000
|
|
|
2,220,000
|
|
||||||
|
|
|
|
18,857,978
|
|
|
19,567,590
|
|
|
21,455,000
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Community Intervention Services, Inc. (2%)*
|
|
Provider of Behavioral Health Services
|
|
Subordinated Note (7% Cash, 6% PIK, Due 01/21)
(5)
|
|
18,736,265
|
|
|
17,717,756
|
|
|
14,134,000
|
|
|||
|
|
|
|
18,736,265
|
|
|
17,717,756
|
|
|
14,134,000
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Comverge, Inc. (3%)*
|
|
Provider of Intelligent Energy Management Solutions
|
|
Senior Note (12% Cash, Due 05/18)
|
|
15,505,583
|
|
|
15,406,749
|
|
|
15,406,749
|
|
|||
Preferred Stock (703 shares)
|
|
|
|
554,458
|
|
|
835,000
|
|
||||||||
Common Stock (1,000,000 shares)
|
|
|
|
100,000
|
|
|
353,000
|
|
||||||||
|
|
|
15,505,583
|
|
|
16,061,207
|
|
|
16,594,749
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
CPower Ultimate HoldCo, LLC (0%)*
|
|
Demand Response Business
|
|
Units (345,542 units)
|
|
|
|
345,542
|
|
|
345,542
|
|
||||
|
|
|
|
|
|
345,542
|
|
|
345,542
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
TRIANGLE CAPITAL CORPORATION
Consolidated Schedule of Investments — (Continued)
December 31, 2016
|
||||||||||||||||
Portfolio Company
|
|
Industry
|
|
Type of Investment
(1)(2)(7)
|
|
Principal
Amount
|
|
Cost
|
|
Fair
Value
(3)
|
||||||
CWS Holding Company, LLC (0%)*
|
|
Manufacturer of Custom Windows and Sliding Doors
|
|
Class A Units (1,500,000 units)
|
|
|
|
$
|
1,500,000
|
|
|
$
|
2,076,000
|
|
||
|
|
|
|
|
1,500,000
|
|
|
2,076,000
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Data Source Holdings, LLC (0%)*
|
|
Print Supply Chain Management Services
|
|
Common Units (47,503 units)
|
|
|
|
1,000,000
|
|
|
940,000
|
|
||||
|
|
|
|
|
1,000,000
|
|
|
940,000
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Del Real, LLC (2%)*
|
|
Hispanic Refrigerated Foods Company
|
|
Subordinated Note (11% Cash, Due 04/23)
|
|
$
|
14,000,000
|
|
|
13,727,515
|
|
|
13,727,515
|
|
||
|
|
Class A Units (3,000,000 units)
|
|
|
|
3,000,000
|
|
|
3,000,000
|
|
||||||
|
|
|
|
14,000,000
|
|
|
16,727,515
|
|
|
16,727,515
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
DialogDirect, Inc. (2%)*
|
|
Business Process Outsourcing Provider
|
|
Subordinated Notes (12% Cash, 1.5% PIK, Due 04/20)
|
|
16,126,541
|
|
|
16,020,226
|
|
|
11,994,000
|
|
|||
|
|
|
16,126,541
|
|
|
16,020,226
|
|
|
11,994,000
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Dimora Brands, Inc. (2%)*
|
|
Hardware Designer and Distributor
|
|
Subordinated Note (LIBOR + 10.0%, 11% Cash, Due 10/23)
(8)
|
|
12,500,000
|
|
|
12,267,514
|
|
|
12,267,514
|
|
|||
|
|
|
|
12,500,000
|
|
|
12,267,514
|
|
|
12,267,514
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
DLC Acquisition, LLC (6%)*
|
|
Staffing Firm
|
|
Senior Notes (LIBOR + 8.0%, 10% Cash, Due 12/20)
(8)
|
|
21,312,500
|
|
|
21,047,577
|
|
|
21,047,577
|
|
|||
|
Senior Note (10% Cash, 2% PIK, Due 12/20)
|
|
16,929,763
|
|
|
16,735,793
|
|
|
16,735,793
|
|
||||||
|
|
|
38,242,263
|
|
|
37,783,370
|
|
|
37,783,370
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Dyno Acquiror, Inc. (1%)*
|
|
Sewing Products and Seasonal Decorative Products Supplier
|
|
Subordinated Note (12% Cash, 2% PIK, Due 11/19)
|
|
7,531,330
|
|
|
7,474,744
|
|
|
7,474,744
|
|
|||
|
Series A Units (600,000 units)
|
|
|
|
600,000
|
|
|
739,000
|
|
|||||||
|
|
|
7,531,330
|
|
|
8,074,744
|
|
|
8,213,744
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Eckler's Holdings, Inc. (1%)*
|
|
Restoration Parts and Accessories for Classic Cars and Trucks
|
|
Subordinated Note (11% Cash, 4.5% PIK, Due 07/18)
|
|
9,941,563
|
|
|
9,882,596
|
|
|
8,396,000
|
|
|||
|
Common Stock (18,029 shares)
|
|
|
|
183,562
|
|
|
—
|
|
|||||||
|
Series A Preferred Stock (1,596 shares)
|
|
|
|
1,596,126
|
|
|
—
|
|
|||||||
|
Series B Preferred Stock (185 shares)
|
|
|
|
185,127
|
|
|
—
|
|
|||||||
|
|
|
9,941,563
|
|
|
11,847,411
|
|
|
8,396,000
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Fresh-G Restaurant Holding, LLC (0%)*
|
|
Restaurant
|
|
Class A Units (5,000 units)
|
|
|
|
500,000
|
|
|
—
|
|
||||
|
|
|
|
|
|
500,000
|
|
|
—
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Flowchem Holdings LLC (0%)*
|
|
Services to Crude Oil Pipeline Operators
|
|
Common Units (1,000,000 units)
|
|
|
|
782,356
|
|
|
2,552,000
|
|
||||
|
|
|
|
|
782,356
|
|
|
2,552,000
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Fridababy Holdings, LLC (4%)*
|
|
Baby Products
|
|
Senior Notes (LIBOR + 9.0%, 10% Cash, Due 10/21)
(8)
|
|
23,000,000
|
|
|
22,558,007
|
|
|
22,558,007
|
|
|||
|
|
Class B Units (4,500 units)
|
|
|
|
273,401
|
|
|
273,401
|
|
||||||
|
|
|
|
23,000,000
|
|
|
22,831,408
|
|
|
22,831,408
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
FrontStream Holdings, LLC (2%)*
|
|
Payment and Donation Management Product Service Provider
|
|
Subordinated Note (12.5% Cash, Due 12/20)
|
|
13,375,000
|
|
|
13,254,632
|
|
|
12,643,000
|
|
|||
|
|
Series C-2 Preferred Shares (500 shares)
|
|
|
|
500,000
|
|
|
435,000
|
|
||||||
|
|
|
|
13,375,000
|
|
|
13,754,632
|
|
|
13,078,000
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Frontstreet Facility Solutions, Inc. (1%)*
|
|
Retail, Restaurant and Commercial Facilities Maintenance
|
|
Subordinated Note (11% Cash, 2% PIK, Due 07/18)
|
|
8,462,629
|
|
|
8,418,332
|
|
|
6,771,000
|
|
|||
|
|
Series A Convertible Preferred Stock (2,500 shares)
|
|
|
|
250,000
|
|
|
—
|
|
||||||
|
|
Series B Convertible Preferred Stock (5,556 shares)
|
|
|
|
500,000
|
|
|
—
|
|
||||||
|
|
|
|
8,462,629
|
|
|
9,168,332
|
|
|
6,771,000
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Frozen Specialties, Inc. (2%)*
|
|
Frozen Foods Manufacturer
|
|
Subordinated Note (10% Cash, 4% PIK, Due 12/17)
|
|
13,675,353
|
|
|
13,675,353
|
|
|
13,675,353
|
|
|||
|
|
13,675,353
|
|
|
13,675,353
|
|
|
13,675,353
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
GST AutoLeather, Inc. (4%)*
|
|
Supplier of Automotive Interior Leather
|
|
Subordinated Note (11% Cash, 2% PIK, Due 01/21)
|
|
23,131,473
|
|
|
22,812,032
|
|
|
22,812,032
|
|
|||
|
|
|
|
23,131,473
|
|
|
22,812,032
|
|
|
22,812,032
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Halo Branded Solutions, Inc. (2%)*
|
|
Supply Chain Services
|
|
Subordinated Notes (11% Cash, 1% PIK, Due 10/22)
|
|
10,410,398
|
|
|
10,190,992
|
|
|
10,190,992
|
|
|||
|
|
Class A1 Units (2,600 units)
|
|
|
|
2,600,000
|
|
|
3,308,000
|
|
||||||
|
|
|
|
10,410,398
|
|
|
12,790,992
|
|
|
13,498,992
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
HKW Capital Partners IV, L.P.
(0%)*
(4)
|
|
Multi-Sector Holdings
|
|
0.6% Limited Partnership Interest
|
|
|
|
835,283
|
|
|
1,231,000
|
|
||||
|
|
|
|
|
|
835,283
|
|
|
1,231,000
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
TRIANGLE CAPITAL CORPORATION
Consolidated Schedule of Investments — (Continued)
December 31, 2016
|
||||||||||||||||
Portfolio Company
|
|
Industry
|
|
Type of Investment
(1)(2)(7)
|
|
Principal
Amount
|
|
Cost
|
|
Fair
Value
(3)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
HTC Borrower, LLC (4%)*
|
|
Hunting and Outdoor Products
|
|
Subordinated Notes (10% Cash, 3% PIK, Due 09/20)
|
|
$
|
26,131,706
|
|
|
$
|
25,854,767
|
|
|
$
|
25,854,767
|
|
|
|
|
|
26,131,706
|
|
|
25,854,767
|
|
|
25,854,767
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
ICP Industrial, Inc. (4%)*
|
|
Coatings Formulator and Manufacturer
|
|
Second Lien Term Note (LIBOR + 8.5%, 9.5% Cash, Due 04/22)
(8)
|
|
7,500,000
|
|
|
7,435,556
|
|
|
7,435,556
|
|
|||
|
|
Subordinated Notes (10% Cash, 1% PIK, Due 10/22)
|
|
8,088,123
|
|
|
7,946,278
|
|
|
7,946,278
|
|
|||||
|
|
Subordinated Notes (14% PIK, Due 10/22)
|
|
5,743,159
|
|
|
5,688,352
|
|
|
5,688,352
|
|
|||||
|
|
Class A Units (1,289 units)
|
|
|
|
1,751,483
|
|
|
1,929,000
|
|
||||||
|
|
|
|
21,331,282
|
|
|
22,821,669
|
|
|
22,999,186
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Inland Pipe Rehabilitation Holding Company LLC (0%)*
|
|
Cleaning and Repair Services
|
|
Membership Interest Purchase Warrant (3%)
|
|
|
|
853,500
|
|
|
1,527,000
|
|
||||
|
|
|
|
853,500
|
|
|
1,527,000
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
IPS Structural Adhesives Holdings, Inc. (2%)*
|
|
Specialty Adhesives and Plumbing Products Manufacturer
|
|
Second Lien Term Note (LIBOR + 9.5%, 10.5% Cash, Due 12/24)
(8)
|
|
15,000,000
|
|
|
14,700,000
|
|
|
14,700,000
|
|
|||
|
|
|
|
15,000,000
|
|
|
14,700,000
|
|
|
14,700,000
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
KidKraft, Inc. (4%)*
|
|
Children's Toy Manufacturer and Distributor
|
|
Second Lien Term Note (11% Cash, 1% PIK, Due 03/22)
|
|
27,668,623
|
|
|
27,135,218
|
|
|
27,135,218
|
|
|||
|
|
|
|
27,668,623
|
|
|
27,135,218
|
|
|
27,135,218
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
K-Square Restaurant Partners, LP (1%)*
|
|
Restaurant
|
|
Class A Units of Limited Partnership (2,000 units)
|
|
|
|
638,260
|
|
|
3,830,000
|
|
||||
|
|
|
|
|
|
638,260
|
|
|
3,830,000
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Lakeview Health Holdings, Inc. (3%)*
|
|
Substance Abuse Treatment Service Provider
|
|
Senior Note (LIBOR + 6.75%, 7.8% Cash, Due 12/21)
(8)
|
|
18,612,633
|
|
|
18,412,633
|
|
|
18,412,633
|
|
|||
|
|
Common Stock (2,000 shares)
|
|
|
|
2,000,000
|
|
|
2,000,000
|
|
||||||
|
|
|
|
18,612,633
|
|
|
20,412,633
|
|
|
20,412,633
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Media Storm, LLC (1%)*
|
|
Marketing Services
|
|
Subordinated Note (10% Cash, Due 08/19)
|
|
6,545,455
|
|
|
6,533,934
|
|
|
5,055,000
|
|
|||
Membership Units (1,216,204 units)
|
|
|
|
1,176,957
|
|
|
260,000
|
|
||||||||
|
|
6,545,455
|
|
|
7,710,891
|
|
|
5,315,000
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
MIC Holding LLC (2%)*
|
|
Firearm Accessories Manufacturer and Distributor
|
|
Preferred Units (1,470 units)
|
|
|
|
1,470,000
|
|
|
3,012,000
|
|
||||
|
|
Common Units (30,000 units)
|
|
|
|
30,000
|
|
|
8,837,000
|
|
||||||
|
|
|
|
|
|
1,500,000
|
|
|
11,849,000
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Micross Solutions LLC (4%)*
|
|
Provider of Semiconductor Products and Services
|
|
Subordinated Note (12% Cash, 3% PIK, Due 06/18)
|
|
24,435,074
|
|
|
24,342,230
|
|
|
24,342,230
|
|
|||
Class A-2 Common Units (1,979,524 units)
|
|
|
|
2,019,693
|
|
|
1,875,000
|
|
||||||||
|
|
24,435,074
|
|
|
26,361,923
|
|
|
26,217,230
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Motor Vehicle Software Corporation (3%)*
|
|
Provider of EVR Services
|
|
Subordinated Note (10% Cash, 0.5% PIK, Due 03/21)
|
|
20,245,100
|
|
|
19,917,945
|
|
|
19,917,945
|
|
|||
|
|
Class A Units (1,000,000 units)
|
|
|
|
1,076,210
|
|
|
1,372,000
|
|
||||||
|
|
|
|
20,245,100
|
|
|
20,994,155
|
|
|
21,289,945
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Nautic Partners VII, LP (0%)*
(4)
|
|
Multi-Sector Holdings
|
|
0.4% Limited Partnership Interest
|
|
|
|
1,093,312
|
|
|
1,520,000
|
|
||||
|
|
|
|
|
|
1,093,312
|
|
|
1,520,000
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Nomacorc, LLC (3%)*
|
|
Synthetic Wine Cork Producer
|
|
Subordinated Note (10% Cash, 2.3% PIK, Due 07/21)
|
|
20,875,890
|
|
|
20,572,926
|
|
|
16,597,000
|
|
|||
|
|
Limited Partnership Interest
|
|
|
|
2,150,637
|
|
|
—
|
|
||||||
|
|
|
|
20,875,890
|
|
|
22,723,563
|
|
|
16,597,000
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Orchid Underwriters Agency, LLC (4%)*
|
|
Insurance Underwriter
|
|
Term B Note (10% Cash, Due 11/19)
|
|
21,409,670
|
|
|
21,125,036
|
|
|
21,125,036
|
|
|||
Class A Preferred Units (15,000 units)
|
|
|
|
1,500,000
|
|
|
1,972,000
|
|
||||||||
Class A Common Units (15,000 units)
|
|
|
|
—
|
|
|
1,624,000
|
|
||||||||
|
|
21,409,670
|
|
|
22,625,036
|
|
|
24,721,036
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
PowerDirect Marketing, LLC (0%)*
|
|
Marketing Services
|
|
Senior Note (13% Cash, 2% PIK, Due 06/17)
(6)
|
|
8,573,531
|
|
|
5,077,482
|
|
|
850,000
|
|
|||
Common Unit Purchase Warrants
|
|
|
|
590,200
|
|
|
—
|
|
||||||||
|
|
8,573,531
|
|
|
5,667,682
|
|
|
850,000
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
ProAmpac PG Borrower LLC (2%)*
|
|
Manufacturer of Flexible Packaging Products
|
|
Second Lien Term Note (LIBOR + 8.5%, 9.5% Cash, Due 11/24)
(8)
|
|
15,000,000
|
|
|
14,775,000
|
|
|
14,775,000
|
|
|||
|
|
|
|
15,000,000
|
|
|
14,775,000
|
|
|
14,775,000
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
TRIANGLE CAPITAL CORPORATION
Consolidated Schedule of Investments — (Continued)
December 31, 2016
|
||||||||||||||||
Portfolio Company
|
|
Industry
|
|
Type of Investment
(1)(2)(7)
|
|
Principal
Amount
|
|
Cost
|
|
Fair
Value
(3)
|
||||||
RockYou, Inc. (0%)*
|
|
Mobile Game Advertising Network
|
|
Common Stock (67,585 shares)
|
|
|
|
$
|
111,000
|
|
|
$
|
111,000
|
|
||
|
|
|
|
|
|
111,000
|
|
|
111,000
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Rotolo Consultants, Inc. (1%)*
|
|
Landscape Services
|
|
Subordinated Note (11% Cash, 3% PIK, Due 08/21)
|
|
$
|
6,904,210
|
|
|
6,792,686
|
|
|
6,792,686
|
|
||
|
|
Series A Preferred Units (39 units)
|
|
|
|
3,654,253
|
|
|
1,671,000
|
|
||||||
|
|
|
|
6,904,210
|
|
|
10,446,939
|
|
|
8,463,686
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
SCA Pharmaceuticals, LLC (0%)*
|
|
Provider of Pharmaceutical Products
|
|
Subordinated Note (LIBOR + 9.0%, 10% Cash, Due 12/20)
(8)
|
|
3,000,000
|
|
|
2,700,000
|
|
|
2,700,000
|
|
|||
|
|
|
|
3,000,000
|
|
|
2,700,000
|
|
|
2,700,000
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
SCUF Gaming, Inc. (4%)*
|
|
Gaming Controller Manufacturer
|
|
Senior Notes (LIBOR + 8.5%, 9.5% Cash, Due 12/21)
(8)
|
|
25,008,000
|
|
|
24,507,840
|
|
|
24,507,840
|
|
|||
|
|
Common Stock (27,112 shares)
|
|
|
|
742,000
|
|
|
742,000
|
|
||||||
|
|
|
|
25,008,000
|
|
|
25,249,840
|
|
|
25,249,840
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Smile Brands, Inc. (4%)*
|
|
Dental Service Organization
|
|
Subordinated Notes (10% Cash, 2% PIK, Due 02/23)
|
|
22,341,283
|
|
|
21,910,129
|
|
|
21,910,129
|
|
|||
|
|
Class A Units (3,000 units)
|
|
|
|
3,000,000
|
|
|
3,000,000
|
|
||||||
|
|
|
|
22,341,283
|
|
|
24,910,129
|
|
|
24,910,129
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
SPC Partners V, LP (0%)*
(4)
|
|
Multi-Sector Holdings
|
|
0.7% Limited Partnership Interest
|
|
|
|
1,922,865
|
|
|
2,019,000
|
|
||||
|
|
|
|
|
|
1,922,865
|
|
|
2,019,000
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Specialized Desanders, Inc. (2%)*
(4)
|
|
Sand and Particulate Removal Equipment Provider for Oil and Gas Companies
|
|
Subordinated Note (12% Cash, 2% PIK, Due 03/20)
|
|
16,110,042
|
|
|
15,966,524
|
|
|
12,524,143
|
|
|||
Class C Partnership Units (2,000,000 units)
|
|
|
|
1,937,421
|
|
|
2,813,000
|
|
||||||||
|
|
|
16,110,042
|
|
|
17,903,945
|
|
|
15,337,143
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Tate's Bake Shop (2%)*
|
|
Producer of Baked Goods
|
|
Subordinated Note (10% Cash, 3% PIK, Due 02/20)
|
|
10,737,451
|
|
|
10,606,430
|
|
|
10,606,430
|
|
|||
|
|
Limited Partnership Interest
|
|
|
|
925,000
|
|
|
1,310,000
|
|
||||||
|
|
|
|
10,737,451
|
|
|
11,531,430
|
|
|
11,916,430
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
TCFI Merlin LLC (2%)*
|
|
Specialty Staffing Service Provider
|
|
Senior Notes (10% Cash, 1% PIK, Due 09/19)
|
|
13,396,027
|
|
|
13,212,935
|
|
|
13,212,935
|
|
|||
|
|
Limited Partnership Units (500,500 units)
|
|
|
|
500,000
|
|
|
578,000
|
|
||||||
|
|
|
|
13,396,027
|
|
|
13,712,935
|
|
|
13,790,935
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
The Cook & Boardman Group, LLC (3%)*
|
|
Distributor of Doors and Related Products
|
|
Subordinated Note (10% Cash, 2.5% PIK, Due 03/20)
|
|
14,840,320
|
|
|
14,656,890
|
|
|
14,656,890
|
|
|||
|
|
Class A Units (1,400,000 units)
|
|
|
|
1,400,000
|
|
|
2,663,000
|
|
||||||
|
|
|
|
14,840,320
|
|
|
16,056,890
|
|
|
17,319,890
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Trademark Global LLC (3%)*
|
|
Supplier to Mass Market Internet Retail
|
|
Subordinated Note (10% Cash, 1.3% PIK, Due 04/23)
|
|
14,800,000
|
|
|
14,584,165
|
|
|
14,584,165
|
|
|||
|
|
Class A Units (1,500,000 units)
|
|
|
|
1,500,000
|
|
|
1,500,000
|
|
||||||
|
|
Class B Units (1,500,000 units)
|
|
|
|
—
|
|
|
—
|
|
||||||
|
|
|
|
14,800,000
|
|
|
16,084,165
|
|
|
16,084,165
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Travelpro Products, Inc. ("Travelpro") and TP - Holiday Group Limited ("TP") (3%)*
|
|
Luggage and Travel Bag Supplier
|
|
Second Lien Term Note - Travelpro (11% Cash, 2% PIK, Due 11/22)
|
|
10,126,055
|
|
|
9,919,675
|
|
|
9,919,675
|
|
|||
|
|
Second Lien Term Note - TP (11% Cash, 2% PIK, Due 11/22)
(4)
|
|
8,970,540
|
|
|
8,784,798
|
|
|
8,562,599
|
|
|||||
|
|
Common Units - Travelpro (2,000,000 units)
|
|
|
|
2,000,000
|
|
|
2,077,000
|
|
||||||
|
|
|
|
19,096,595
|
|
|
20,704,473
|
|
|
20,559,274
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
United Biologics, LLC (2%)*
|
|
Allergy Immunotherapy
|
|
Senior Note (12% Cash, 2% PIK, Due 04/18)
|
|
12,758,807
|
|
|
12,686,184
|
|
|
12,686,184
|
|
|||
|
Class A-1 Common Units (18,818 units)
|
|
|
|
137,324
|
|
|
137,000
|
|
|||||||
|
Class A Common Units (177,935 units)
|
|
|
|
1,999,989
|
|
|
1,767,000
|
|
|||||||
|
Class A-2 Common Kicker Units (444,003 units)
|
|
|
|
—
|
|
|
—
|
|
|||||||
|
Class A-1 Common Kicker Units (14,114 units)
|
|
|
|
—
|
|
|
—
|
|
|||||||
|
Class A, Class A-1, Class A-1 Kicker & Class B Unit Purchase Warrants
|
|
|
|
838,117
|
|
|
361,000
|
|
|||||||
|
|
|
|
12,758,807
|
|
|
15,661,614
|
|
|
14,951,184
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Vantage Mobility International, LLC (5%)*
|
|
Wheelchair Accessible Vehicle Manufacturer
|
|
Subordinated Notes (10.2% Cash, Due 09/21)
(8)
|
|
29,350,000
|
|
|
28,785,893
|
|
|
28,785,893
|
|
|||
|
|
Class A Units (1,750,000 units)
|
|
|
|
1,750,000
|
|
|
1,750,000
|
|
||||||
|
|
|
|
29,350,000
|
|
|
30,535,893
|
|
|
30,535,893
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
TRIANGLE CAPITAL CORPORATION
Consolidated Schedule of Investments — (Continued)
December 31, 2016
|
||||||||||||||||
Portfolio Company
|
|
Industry
|
|
Type of Investment
(1)(2)(7)
|
|
Principal
Amount
|
|
Cost
|
|
Fair
Value
(3)
|
||||||
Water Pik, Inc. (5%)*
|
|
Oral Health and Shower Head Supplier
|
|
Second Lien Term Loan (LIBOR + 8.75%, 9.8% Cash, Due 01/21)
(8)
|
|
$
|
31,150,970
|
|
|
$
|
30,769,847
|
|
|
$
|
30,769,847
|
|
|
|
|
|
31,150,970
|
|
|
30,769,847
|
|
|
30,769,847
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Wheel Pros Holdings, Inc. (3%)*
|
|
Wheel/Rim and Performance Tire Distributor
|
|
Subordinated Note (LIBOR + 7.0%, 11% Cash, Due 06/20)
(8)
|
|
13,822,500
|
|
|
13,605,040
|
|
|
13,605,040
|
|
|||
|
|
Class A Units (2,000 units)
|
|
|
|
1,954,144
|
|
|
1,954,000
|
|
||||||
|
|
|
|
13,822,500
|
|
|
15,559,184
|
|
|
15,559,040
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Women's Marketing, Inc. (2%)*
|
|
Full-Service Media Organization
|
|
Subordinated Note (11% Cash, 1.5% PIK, Due 06/21)
(6)
|
|
16,868,045
|
|
|
16,141,439
|
|
|
11,093,000
|
|
|||
|
|
Class A Common Units (16,300 units)
|
|
|
|
1,630,000
|
|
|
—
|
|
||||||
|
|
|
|
16,868,045
|
|
|
17,771,439
|
|
|
11,093,000
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
WSO Holdings, LP (1%)*
|
|
Organic/Fair Trade Sugar, Syrup, Nectar and Honey Producer
|
|
Common Points (3,000 points)
|
|
|
|
3,000,000
|
|
|
3,576,000
|
|
||||
|
|
|
|
|
3,000,000
|
|
|
3,576,000
|
|
|||||||
|
|
|
|
|
|
|
||||||||||
YummyEarth Inc. (3%)*
|
|
Organic Candy Manufacturer
|
|
Senior Notes (LIBOR + 8.5%, 9.5% Cash, Due 08/20)
(8)
|
|
22,000,000
|
|
|
21,565,471
|
|
|
19,564,000
|
|
|||
|
|
Limited Partnership Interest
|
|
|
|
3,496,500
|
|
|
—
|
|
||||||
|
|
|
|
22,000,000
|
|
|
25,061,971
|
|
|
19,564,000
|
|
|||||
|
|
|
|
|
|
|
||||||||||
Subtotal Non–Control / Non–Affiliate Investments
|
|
825,243,841
|
|
|
888,974,154
|
|
|
857,604,639
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Affiliate Investments:
|
|
|
|
|
|
|
|
|
|
|
||||||
All Metals Holding, LLC (1%)*
|
|
Steel Processor and Distributor
|
|
Subordinated Note (12% Cash, 1% PIK, Due 12/21)
|
|
6,433,333
|
|
|
6,249,220
|
|
|
6,249,220
|
|
|||
|
|
Units (318,977 units)
|
|
|
|
793,331
|
|
|
754,000
|
|
||||||
|
|
|
|
6,433,333
|
|
|
7,042,551
|
|
|
7,003,220
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
CIS Secure Computing Inc. (2%)*
|
|
Secure Communications and Computing Solutions Provider
|
|
Subordinated Note (12% Cash, 3% PIK, Due 03/18)
|
|
11,670,708
|
|
|
11,670,708
|
|
|
11,670,708
|
|
|||
Common Stock (84 shares)
|
|
|
|
502,320
|
|
|
2,155,000
|
|
||||||||
|
|
11,670,708
|
|
|
12,173,028
|
|
|
13,825,708
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Consolidated Lumber Company LLC (1%)*
|
|
Lumber Yard Operator
|
|
Subordinated Note (10% Cash, 2% PIK, Due 09/20)
|
|
4,193,848
|
|
|
4,121,389
|
|
|
4,278,000
|
|
|||
|
|
Class A Units (15,000 units)
|
|
|
|
1,500,000
|
|
|
2,481,000
|
|
||||||
|
|
|
|
4,193,848
|
|
|
5,621,389
|
|
|
6,759,000
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
DPII Holdings, LLC (0%)*
|
|
Satellite Communication Business
|
|
Tranche I & II Subordinated Notes (12% Cash, 4% PIK, Due 01/18)
(6)
|
|
3,744,709
|
|
|
3,227,001
|
|
|
2,356,001
|
|
|||
|
|
Tranche III Subordinated Note (19% PIK, Due 01/18)
(6)
|
|
2,408,752
|
|
|
2,148,462
|
|
|
—
|
|
|||||
|
|
Class A Membership Interest (17,308 units)
|
|
|
|
1,107,692
|
|
|
—
|
|
||||||
|
|
|
|
6,153,461
|
|
|
6,483,155
|
|
|
2,356,001
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
FCL Holding SPV, LLC (0%)*
|
|
Commercial Printing Services
|
|
Class A Interest (24,873 units)
|
|
|
|
292,000
|
|
|
645,000
|
|
||||
|
|
Class B Interest (48,427 units)
|
|
|
|
—
|
|
|
101,000
|
|
||||||
|
|
Class C Interest (3,746 units)
|
|
|
|
—
|
|
|
—
|
|
||||||
|
|
|
|
|
|
292,000
|
|
|
746,000
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Frank Entertainment Group, LLC
(3%)*
|
|
Movie Theatre and Family Entertainment Operator
|
|
Senior Note (LIBOR + 7%, 10% Cash, 5.8% PIK, Due 06/18)
(8)
|
|
9,997,644
|
|
|
9,940,684
|
|
|
9,940,684
|
|
|||
|
|
Class A Redeemable Preferred Units (10.5% Cash) (196,718 units)
|
|
|
|
3,934,666
|
|
|
4,566,904
|
|
||||||
|
|
Class B Redeemable Preferred Units (18,667 units)
|
|
|
|
433,334
|
|
|
1,660,810
|
|
||||||
|
|
Class C Redeemable Preferred Units (25,846 units)
|
|
|
|
600,000
|
|
|
600,000
|
|
||||||
|
|
Class A Common Units (43,077 units)
|
|
|
|
1,000,000
|
|
|
—
|
|
||||||
|
|
Class A Common Warrants
|
|
|
|
632,000
|
|
|
—
|
|
||||||
|
|
|
|
9,997,644
|
|
|
16,540,684
|
|
|
16,768,398
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
MS Bakery Holdings, Inc. (1%)*
|
|
Baked Goods Provider
|
|
Preferred Units (233 units)
|
|
|
|
211,867
|
|
|
397,000
|
|
||||
|
Common B Units (3,000 units)
|
|
|
|
23,140
|
|
|
2,110,000
|
|
|||||||
|
Common A Units (1,652 units)
|
|
|
|
14,993
|
|
|
1,162,000
|
|
|||||||
|
|
|
|
|
|
250,000
|
|
|
3,669,000
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
TRIANGLE CAPITAL CORPORATION
Consolidated Schedule of Investments — (Continued)
December 31, 2016
|
||||||||||||||||
Portfolio Company
|
|
Industry
|
|
Type of Investment
(1)(2)(7)
|
|
Principal
Amount
|
|
Cost
|
|
Fair
Value
(3)
|
||||||
NB Products, Inc. (8%)*
|
|
Distributor of Work Apparel and Accessories
|
|
Subordinated Note (12% Cash, 2% PIK, Due 02/20)
|
|
$
|
23,105,315
|
|
|
$
|
22,751,190
|
|
|
$
|
22,751,190
|
|
|
Jr. Subordinated Note (10% PIK, Due 02/20)
|
|
4,705,830
|
|
|
4,595,921
|
|
|
4,595,921
|
|
||||||
|
Jr. Subordinated Bridge Note (20% PIK, Due 05/21)
|
|
2,002,586
|
|
|
1,972,727
|
|
|
1,972,727
|
|
||||||
|
Series A Redeemable Senior Preferred Stock (7,839 shares)
|
|
|
|
7,621,648
|
|
|
9,412,000
|
|
|||||||
|
Common Stock (1,668,691 shares)
|
|
|
|
333,738
|
|
|
9,779,000
|
|
|||||||
|
|
|
29,813,731
|
|
|
37,275,224
|
|
|
48,510,838
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
PCX Aerostructures, LLC (4%)*
|
|
Aerospace Component Manufacturer
|
|
Subordinated Note (10.5% Cash, Due 10/19)
|
|
29,647,359
|
|
|
29,148,152
|
|
|
21,960,000
|
|
|||
|
Series A Preferred Stock (6,066 shares)
|
|
|
|
6,065,621
|
|
|
—
|
|
|||||||
Series B Preferred Stock (411 shares)
|
|
|
|
410,514
|
|
|
—
|
|
||||||||
Class A Common Stock (121,922 shares)
|
|
|
|
30,480
|
|
|
—
|
|
||||||||
|
|
|
29,647,359
|
|
|
35,654,767
|
|
|
21,960,000
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Team Waste, LLC (1%)*
|
|
Environmental and Facilities Services
|
|
Preferred Units (455,000 units)
|
|
|
|
9,100,000
|
|
|
9,100,000
|
|
||||
|
|
|
|
|
|
|
9,100,000
|
|
|
9,100,000
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Technology Crops, LLC (2%)*
|
|
Supply Chain Management Services
|
|
Subordinated Notes (12% Cash, 5% PIK, Due 09/17)
|
|
11,837,622
|
|
|
11,837,622
|
|
|
11,837,622
|
|
|||
Common Units (50 units)
|
|
|
|
500,000
|
|
|
—
|
|
||||||||
|
|
|
11,837,622
|
|
|
12,337,622
|
|
|
11,837,622
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
TGaS Advisors, LLC (2%)*
|
|
Advisory Solutions to Pharmaceutical Companies
|
|
Senior Note (10% Cash, 1% PIK, Due 11/19)
|
|
9,674,276
|
|
|
9,521,986
|
|
|
9,521,986
|
|
|||
|
Preferred Units (1,685,357 units)
|
|
|
|
1,556,069
|
|
|
1,270,000
|
|
|||||||
|
|
|
9,674,276
|
|
|
11,078,055
|
|
|
10,791,986
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Tulcan Fund IV, L.P. (0%)*
|
|
Custom Forging and Fastener Supplies
|
|
Common Units (1,000,000 units)
|
|
|
|
1,000,000
|
|
|
—
|
|
||||
|
|
|
|
|
|
1,000,000
|
|
|
—
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
United Retirement Plan Consultants, Inc. (0%)*
|
|
Retirement Plan Administrator
|
|
Series A Preferred Shares (9,400 shares)
|
|
|
|
205,748
|
|
|
257,000
|
|
||||
|
|
Common Shares (100,000 shares)
|
|
|
|
1,000,000
|
|
|
301,000
|
|
||||||
|
|
|
|
|
|
1,205,748
|
|
|
558,000
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Waste Recyclers Holdings, LLC (0%)*
|
|
Environmental and Facilities Services
|
|
Class A Preferred Units (280 units)
|
|
|
|
2,251,100
|
|
|
—
|
|
||||
Class B Preferred Units (11,484,867 units)
|
|
|
|
3,304,218
|
|
|
817,000
|
|
||||||||
Common Unit Purchase Warrant (1,170,083 units)
|
|
|
|
748,900
|
|
|
—
|
|
||||||||
Common Units (153,219 units)
|
|
|
|
180,783
|
|
|
—
|
|
||||||||
|
|
|
|
|
6,485,001
|
|
|
817,000
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Wythe Will Tzetzo, LLC (1%)*
|
|
Confectionery Goods Distributor
|
|
Series A Preferred Units (99,829 units)
|
|
|
|
—
|
|
|
6,808,000
|
|
||||
|
|
|
|
|
|
—
|
|
|
6,808,000
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Subtotal Affiliate Investments
|
|
|
|
119,421,982
|
|
|
162,539,224
|
|
|
161,510,773
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Control Investments:
|
|
|
|
|
|
|
|
|
|
|
||||||
CRS Reprocessing, LLC (1%)*
|
|
Fluid
Reprocessing Services |
|
Senior Notes (LIBOR + 3.5%, 4.3% Cash, Due 06/17)
(8)
|
|
2,942,769
|
|
|
2,942,769
|
|
|
2,942,769
|
|
|||
|
Split Collateral Term Loans (8% Cash, Due 06/17)
|
|
11,192,464
|
|
|
11,192,464
|
|
|
6,182,000
|
|
||||||
Series F Preferred Units (705,321 units)
|
|
|
|
9,134,807
|
|
|
—
|
|
||||||||
|
Common Units (15,174 units)
|
|
|
|
—
|
|
|
—
|
|
|||||||
|
|
|
14,135,233
|
|
|
23,270,040
|
|
|
9,124,769
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
DCWV Acquisition Corporation
(0%)*
|
|
Arts & Crafts and Home Decor Products Designer and Supplier
|
|
Senior Subordinated Note (15% PIK, Due 12/19)
(6)
|
|
291,875
|
|
|
250,000
|
|
|
250,000
|
|
|||
|
|
Subordinated Note (12% Cash, 3% PIK, Due 12/19)
(6)
|
|
8,090,699
|
|
|
6,178,633
|
|
|
1,389,000
|
|
|||||
|
Jr. Subordinated Note (15% PIK, Due 12/19)
(6)
|
|
2,440,829
|
|
|
2,000,000
|
|
|
—
|
|
||||||
|
Series A Preferred Equity (1,200 shares)
|
|
|
|
1,200,000
|
|
|
—
|
|
|||||||
|
100% Common Shares
|
|
|
|
—
|
|
|
—
|
|
|||||||
|
|
|
10,823,403
|
|
|
9,628,633
|
|
|
1,639,000
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
TRIANGLE CAPITAL CORPORATION
Consolidated Schedule of Investments — (Continued)
December 31, 2016
|
||||||||||||||||
Portfolio Company
|
|
Industry
|
|
Type of Investment
(1)(2)(7)
|
|
Principal
Amount
|
|
Cost
|
|
Fair
Value
(3)
|
||||||
Gerli & Company (0%)*
|
|
Specialty Woven Fabrics Manufacturer
|
|
Subordinated Note (13% Cash, Due 01/17)
(6)
|
|
$
|
648,527
|
|
|
$
|
375,000
|
|
|
$
|
—
|
|
Subordinated Note (8.5% Cash, Due 01/17)
(6)
|
|
4,900,843
|
|
|
3,000,000
|
|
|
—
|
|
|||||||
Class A Preferred Shares (1,211 shares)
|
|
|
|
855,000
|
|
|
—
|
|
||||||||
Class C Preferred Shares (744 shares)
|
|
|
|
—
|
|
|
—
|
|
||||||||
Class E Preferred Shares (400 shares)
|
|
|
|
161,440
|
|
|
—
|
|
||||||||
Common Stock (300 shares)
|
|
|
|
100,000
|
|
|
—
|
|
||||||||
|
|
|
5,549,370
|
|
|
4,491,440
|
|
|
—
|
|
||||||
|
|
|
|
|
|
|
|
|
||||||||
SRC Worldwide, Inc. (1%)*
|
|
Specialty Chemical Manufacturer
|
|
Common Stock (5,000 shares)
|
|
|
|
8,028,000
|
|
|
8,028,000
|
|
||||
|
|
|
|
|
|
8,028,000
|
|
|
8,028,000
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Subtotal Control Investments
|
|
|
|
30,508,006
|
|
|
45,418,113
|
|
|
18,791,769
|
|
|||||
|
|
|
|
|
|
|
|
|
||||||||
Total Investments, December 31, 2016 (170%)*
|
|
|
|
$
|
975,173,829
|
|
|
$
|
1,096,931,491
|
|
|
$
|
1,037,907,181
|
|
(1)
|
All debt investments are income producing, unless otherwise noted. Equity and equity-linked investments are non-income producing, unless otherwise noted. The fair values of all investments were determined using significant unobservable inputs.
|
(2)
|
Disclosures of interest rates on notes include cash interest rates and payment-in-kind (“PIK”) interest rates.
|
(3)
|
All investments are restricted as to resale and were valued at fair value as determined in good faith by the Board of Directors.
|
(4)
|
Investment is not a qualifying investment as defined under Section 55(a) of the Investment Company Act of 1940, as amended. Non-qualifying assets represent 2.5% of total investments at fair value as of December 31, 2016. Qualifying assets must represent at least 70% of total assets at the time of acquisition of any additional non-qualifying assets. If at any time qualifying assets do not represent at least 70% of the Company's total assets, the Company will be precluded from acquiring any additional non-qualifying asset until such time as it complies with the requirements of Section 55(a).
|
(5)
|
PIK non-accrual investment
|
(6)
|
Non-accrual investment
|
(7)
|
All of the Company's investments, unless otherwise noted, are encumbered either as security for the Company's senior secured credit facility or in support of the SBA-guaranteed debentures issued by Triangle Mezzanine Fund LLLP and Triangle Mezzanine Fund II LP.
|
(8)
|
Index-based floating interest rate is subject to contractual minimum interest rate. A majority of the variable rate loans in the Company's investment portfolio bear interest at a rate that may be determined by reference to either LIBOR or an alternate Base Rate (commonly based on the Federal Funds Rate or the Prime Rate), which typically resets semi-annually, quarterly, or monthly at the borrower's option. The borrower may also elect to have multiple interest reset periods for each loan.
|
For the quarter ended:
|
|
Total
companies
|
|
Percent of total
investments at
fair value(1)
|
March 31, 2015
|
|
16
|
|
28%
|
June 30, 2015
|
|
15
|
|
26%
|
September 30, 2015
|
|
22
|
|
34%
|
December 31, 2015
|
|
17
|
|
28%
|
March 31, 2016
|
|
18
|
|
27%
|
June 30, 2016
|
|
19
|
|
30%
|
September 30, 2016
|
|
19
|
|
33%
|
December 31, 2016
|
|
20
|
|
33%
|
March 31, 2017
|
|
18
|
|
30%
|
June 30, 2017
|
|
20
|
|
29%
|
September 30, 2017
|
|
22
|
|
25%
|
December 31, 2017
|
|
21
|
|
35%
|
(1)
|
Exclusive of the fair value of new investments made during the quarter.
|
December 31, 2017:
|
Fair Value
(1)
|
|
Valuation
Model
|
|
Level 3
Input
|
|
Range of
Inputs
|
|
Weighted
Average
|
||
Subordinated debt and 2nd lien notes
|
$
|
570,133,358
|
|
|
Income
Approach
|
|
Required Rate of Return
|
|
8.9% – 15.1%
|
|
11.7%
|
|
|
|
|
Leverage Ratio
|
|
0.0x – 7.1x
|
|
4.6x
|
|||
|
|
|
|
Adjusted EBITDA
|
|
$1.0 million – $1.0 billion
|
|
$44.1 million
|
|||
Subordinated debt and 2nd lien notes
|
12,981,000
|
|
|
Enterprise
Value Waterfall
Approach |
|
Adjusted EBITDA Multiple
|
|
5.5x – 7.6x
|
|
6.6x
|
|
|
|
|
|
Adjusted EBITDA
|
|
$1.7 million – $6.6 million
|
|
$4.3 million
|
|||
|
|
|
|
Revenue Multiple
|
|
0.8x – 0.8x
|
|
0.8x
|
|||
|
|
|
|
Revenues
|
|
$76.6 million – $76.6 million
|
|
$76.6 million
|
|||
Senior debt and 1st lien notes
|
249,780,755
|
|
|
Income
Approach
|
|
Required Rate of Return
|
|
6.8% – 25.0%
|
|
10.8%
|
|
|
|
|
|
Leverage Ratio
|
|
0.6x – 8.5x
|
|
4.4x
|
|||
|
|
|
|
Adjusted EBITDA
|
|
$2.9 million – $142.4 million
|
|
$16.2 million
|
|||
Equity shares and warrants
|
163,666,691
|
|
|
Enterprise
Value Waterfall
Approach |
|
Adjusted EBITDA Multiple
|
|
3.3x – 14.9x
|
|
7.8x
|
|
|
|
|
|
Adjusted EBITDA
|
|
$1.0 million – $60.0 million
|
|
$15.6 million
|
|||
|
|
|
|
|
Revenue Multiple
|
|
0.8x – 3.0x
|
|
1.3x
|
||
|
|
|
|
|
Revenues
|
|
$17.0 million – 76.6 million
|
|
$53.7 million
|
(1)
|
One
subordinated debt investment with a fair value of $6,434,000, one senior debt investment with a fair value of $13,022,542 and one equity security with a fair value of $266,000 were repaid or redeemed subsequent to the end of the reporting period and were valued at their transaction price.
|
December 31, 2016:
|
Fair Value
(1)
|
|
Valuation
Model |
|
Level 3
Input |
|
Range of
Inputs |
|
Weighted
Average |
||
Subordinated debt and 2nd lien notes
|
$
|
646,856,367
|
|
|
Income
Approach |
|
Required Rate of Return
|
|
9.5% – 35.0%
|
|
13.8%
|
|
|
|
Leverage Ratio
|
|
0.1x – 9.5x
|
|
4.8x
|
||||
|
|
|
Adjusted EBITDA
|
|
$2.6 million – $169.8 million
|
|
$27.9 million
|
||||
Subordinated debt and 2nd lien notes
|
19,790,000
|
|
|
Enterprise
Value Waterfall Approach |
|
Adjusted EBITDA Multiple
|
|
5.0x – 6.7x
|
|
5.8x
|
|
|
|
|
Adjusted EBITDA
|
|
$0.6 million – $4.9 million
|
|
$2.1 million
|
||||
|
|
|
|
|
Revenue Multiple
|
|
0.8x – 0.8x
|
|
0.8x
|
||
|
|
|
|
|
Revenues
|
|
$98.0 million – $98.0 million
|
|
$98.0 million
|
||
Senior debt and 1st lien notes
|
190,793,157
|
|
|
Income Approach
|
|
Required Rate of Return
|
|
4.3% – 20.0%
|
|
11.0%
|
|
|
|
|
Leverage Ratio
|
|
0.0x – 8.3x
|
|
3.2x
|
||||
|
|
|
Adjusted EBITDA
|
|
$4.0 million – $14.1 million
|
|
$9.3 million
|
||||
Equity shares and warrants
|
152,435,657
|
|
|
Enterprise
Value Waterfall Approach |
|
Adjusted EBITDA Multiple
|
|
3.3x – 14.9x
|
|
7.4x
|
|
|
|
|
Adjusted EBITDA
|
|
($1.4 million) – $82.1 million
|
|
$15.0 million
|
||||
|
|
|
Revenue Multiple
|
|
0.8x – 4.0x
|
|
1.4x
|
||||
|
|
|
Revenues
|
|
$19.0 million – $98.0 million
|
|
$61.7 million
|
(1)
|
Certain subordinated debt investments with a total fair value of $23,513,000 and certain equity securities with a total fair value of $3,669,000 were repaid or redeemed subsequent to the end of the reporting period and were valued at their transaction price. One senior debt investment with a total fair value of $850,000 is expected to be repaid subsequent to the end of the reporting period and was valued at its expected settlement value.
|
|
Years Ended December 31
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
Recurring Fee Income:
|
|
|
|
|
|
||||||
Amortization of loan origination fees
|
$
|
2,445,485
|
|
|
$
|
2,161,711
|
|
|
$
|
2,061,004
|
|
Management, valuation and other fees
|
940,361
|
|
|
1,024,213
|
|
|
895,677
|
|
|||
Total Recurring Fee Income
|
3,385,846
|
|
|
3,185,924
|
|
|
2,956,681
|
|
|||
Non-Recurring Fee Income:
|
|
|
|
|
|
||||||
Prepayment fees
|
2,688,814
|
|
|
1,903,251
|
|
|
4,344,705
|
|
|||
Acceleration of unamortized loan origination fees
|
4,202,078
|
|
|
2,406,688
|
|
|
4,104,485
|
|
|||
Advisory and structuring fees
|
230,000
|
|
|
200,000
|
|
|
578,162
|
|
|||
Loan amendment fees
|
132,278
|
|
|
277,396
|
|
|
469,357
|
|
|||
Other fees
|
9,000
|
|
|
412,606
|
|
|
391,538
|
|
|||
Total Non-Recurring Fee Income
|
7,262,170
|
|
|
5,199,941
|
|
|
9,888,247
|
|
|||
Total Fee Income
|
$
|
10,648,016
|
|
|
$
|
8,385,865
|
|
|
$
|
12,844,928
|
|
Declared
|
|
Record
|
|
Payable
|
|
Per Share
Amount
|
|
Amount
Paid in
Cash
|
|
Amount Settled via Newly Issued Shares
|
|
Total
|
||||||||
February 25, 2015
|
|
March 11, 2015
|
|
March 25, 2015
|
|
$
|
0.54
|
|
|
$
|
17,163,000
|
|
|
$
|
760,000
|
|
|
$
|
17,923,000
|
|
February 25, 2015
|
|
March 11, 2015
|
|
March 25, 2015
|
|
0.05
|
|
|
1,589,000
|
|
|
70,000
|
|
|
1,659,000
|
|
||||
May 27, 2015
|
|
June 10, 2015
|
|
June 24, 2015
|
|
0.54
|
|
|
17,156,000
|
|
|
792,000
|
|
|
17,948,000
|
|
||||
May 27, 2015
|
|
June 10, 2015
|
|
June 24, 2015
|
|
0.05
|
|
|
1,588,000
|
|
|
73,000
|
|
|
1,661,000
|
|
||||
August 26, 2015
|
|
September 9, 2015
|
|
September 23, 2015
|
|
0.54
|
|
|
17,067,000
|
|
|
898,000
|
|
|
17,965,000
|
|
||||
August 26, 2015
|
|
September 9, 2015
|
|
September 23, 2015
|
|
0.05
|
|
|
1,580,000
|
|
|
83,000
|
|
|
1,663,000
|
|
||||
November 25, 2015
|
|
December 9, 2015
|
|
December 23, 2015
|
|
0.54
|
|
|
17,033,000
|
|
|
961,000
|
|
|
17,994,000
|
|
||||
November 25, 2015
|
|
December 9, 2015
|
|
December 23, 2015
|
|
0.05
|
|
|
1,577,000
|
|
|
89,000
|
|
|
1,666,000
|
|
||||
Total 2015 dividends and distributions
|
|
$
|
2.36
|
|
|
$
|
74,753,000
|
|
|
$
|
3,726,000
|
|
|
$
|
78,479,000
|
|
||||
February 24, 2016
|
|
March 9, 2016
|
|
March 23, 2016
|
|
$
|
0.54
|
|
|
$
|
17,264,000
|
|
|
$
|
844,000
|
|
|
$
|
18,108,000
|
|
May 4, 2016
|
|
June 8, 2016
|
|
June 22, 2016
|
|
0.45
|
|
|
14,369,000
|
|
|
746,000
|
|
|
15,115,000
|
|
||||
August 24, 2016
|
|
September 7, 2016
|
|
September 21, 2016
|
|
0.45
|
|
|
17,430,000
|
|
|
736,000
|
|
|
18,166,000
|
|
||||
November 23, 2016
|
|
December 7, 2016
|
|
December 21, 2016
|
|
0.45
|
|
|
17,413,000
|
|
|
750,000
|
|
|
18,163,000
|
|
||||
Total 2016 dividends and distributions
|
|
$
|
1.89
|
|
|
$
|
66,476,000
|
|
|
$
|
3,076,000
|
|
|
$
|
69,552,000
|
|
||||
February 22, 2017
|
|
March 8, 2017
|
|
March 22, 2017
|
|
$
|
0.45
|
|
|
$
|
20,688,000
|
|
|
$
|
750,000
|
|
|
$
|
21,438,000
|
|
May 3, 2017
|
|
June 7, 2017
|
|
June 21, 2017
|
|
0.45
|
|
|
20,575,000
|
|
|
888,000
|
|
|
21,463,000
|
|
||||
August 2, 2017
|
|
September 6, 2017
|
|
September 20, 2017
|
|
0.45
|
|
|
21,484,000
|
|
|
—
|
|
|
21,484,000
|
|
||||
November 1, 2017
|
|
December 6, 2017
|
|
December 20, 2017
|
|
0.30
|
|
|
14,322,000
|
|
|
—
|
|
|
14,322,000
|
|
||||
Total 2017 dividends and distributions
|
|
$
|
1.65
|
|
|
$
|
77,069,000
|
|
|
$
|
1,638,000
|
|
|
$
|
78,707,000
|
|
|
|
Cost
|
|
Percentage of
Total
Portfolio
|
|
Fair Value
|
|
Percentage of
Total
Portfolio
|
||||||
December 31, 2017:
|
|
|
|
|
|
|
|
|
||||||
Subordinated debt and 2
nd
lien notes
|
|
$
|
710,543,854
|
|
|
63
|
%
|
|
$
|
589,548,358
|
|
|
58
|
%
|
Senior debt and 1
st
lien notes
|
|
275,088,787
|
|
|
25
|
|
|
262,803,297
|
|
|
26
|
|
||
Equity shares
|
|
134,301,587
|
|
|
12
|
|
|
162,543,691
|
|
|
16
|
|
||
Equity warrants
|
|
1,691,617
|
|
|
—
|
|
|
1,389,000
|
|
|
—
|
|
||
|
|
$
|
1,121,625,845
|
|
|
100
|
%
|
|
$
|
1,016,284,346
|
|
|
100
|
%
|
December 31, 2016:
|
|
|
|
|
|
|
|
|
||||||
Subordinated debt and 2
nd
lien notes
|
|
$
|
753,635,857
|
|
|
69
|
%
|
|
$
|
690,159,367
|
|
|
67
|
%
|
Senior debt and 1
st
lien notes
|
|
198,616,110
|
|
|
18
|
|
|
191,643,157
|
|
|
18
|
|
||
Equity shares
|
|
140,524,807
|
|
|
13
|
|
|
154,216,657
|
|
|
15
|
|
||
Equity warrants
|
|
4,154,717
|
|
|
—
|
|
|
1,888,000
|
|
|
—
|
|
||
|
|
$
|
1,096,931,491
|
|
|
100
|
%
|
|
$
|
1,037,907,181
|
|
|
100
|
%
|
|
Fair Value at December 31, 2017
|
||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Subordinated debt and 2
nd
lien notes
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
589,548,358
|
|
|
$
|
589,548,358
|
|
Senior debt and 1
st
lien notes
|
—
|
|
|
—
|
|
|
262,803,297
|
|
|
262,803,297
|
|
||||
Equity shares
|
—
|
|
|
—
|
|
|
162,543,691
|
|
|
162,543,691
|
|
||||
Equity warrants
|
—
|
|
|
—
|
|
|
1,389,000
|
|
|
1,389,000
|
|
||||
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,016,284,346
|
|
|
$
|
1,016,284,346
|
|
|
|
|
|
|
|
|
|
||||||||
|
Fair Value at December 31, 2016
|
||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Subordinated debt and 2
nd
lien notes
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
690,159,367
|
|
|
$
|
690,159,367
|
|
Senior debt and 1
st
lien notes
|
—
|
|
|
—
|
|
|
191,643,157
|
|
|
191,643,157
|
|
||||
Equity shares
|
—
|
|
|
—
|
|
|
154,216,657
|
|
|
154,216,657
|
|
||||
Equity warrants
|
—
|
|
|
—
|
|
|
1,888,000
|
|
|
1,888,000
|
|
||||
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,037,907,181
|
|
|
$
|
1,037,907,181
|
|
Year Ended
December 31, 2017:
|
Subordinated
Debt and 2
nd
Lien Notes
|
|
Senior Debt
and 1
st
Lien
Notes
|
|
Equity
Shares
|
|
Equity
Warrants
|
|
Total
|
||||||||||
Fair value, beginning of period
|
$
|
690,159,367
|
|
|
$
|
191,643,157
|
|
|
$
|
154,216,657
|
|
|
$
|
1,888,000
|
|
|
$
|
1,037,907,181
|
|
New investments
|
262,333,868
|
|
|
205,493,670
|
|
|
15,915,860
|
|
|
—
|
|
|
483,743,398
|
|
|||||
Investment reclass
|
33,614,656
|
|
|
(42,014,656
|
)
|
|
8,400,000
|
|
|
—
|
|
|
—
|
|
|||||
Proceeds from sales of investments
|
—
|
|
|
—
|
|
|
(29,065,946
|
)
|
|
(550,863
|
)
|
|
(29,616,809
|
)
|
|||||
Loan origination fees received
|
(4,355,181
|
)
|
|
(2,938,834
|
)
|
|
—
|
|
|
—
|
|
|
(7,294,015
|
)
|
|||||
Principal repayments received
|
(302,112,732
|
)
|
|
(71,949,131
|
)
|
|
—
|
|
|
—
|
|
|
(374,061,863
|
)
|
|||||
PIK interest earned
|
9,916,389
|
|
|
1,001,142
|
|
|
—
|
|
|
—
|
|
|
10,917,531
|
|
|||||
PIK interest payments received
|
(12,431,539
|
)
|
|
(507,979
|
)
|
|
—
|
|
|
—
|
|
|
(12,939,518
|
)
|
|||||
Accretion of loan discounts
|
419,114
|
|
|
57,778
|
|
|
—
|
|
|
—
|
|
|
476,892
|
|
|||||
Accretion of deferred loan origination revenue
|
4,846,747
|
|
|
1,490,694
|
|
|
—
|
|
|
—
|
|
|
6,337,441
|
|
|||||
Realized loss
|
(35,323,325
|
)
|
|
(14,160,007
|
)
|
|
(1,473,134
|
)
|
|
(1,912,237
|
)
|
|
(52,868,703
|
)
|
|||||
Unrealized appreciation (depreciation)
|
(57,519,006
|
)
|
|
(5,312,537
|
)
|
|
14,550,254
|
|
|
1,964,100
|
|
|
(46,317,189
|
)
|
|||||
Fair value, end of period
|
$
|
589,548,358
|
|
|
$
|
262,803,297
|
|
|
$
|
162,543,691
|
|
|
$
|
1,389,000
|
|
|
$
|
1,016,284,346
|
|
Year Ended
December 31, 2016:
|
Subordinated
Debt and 2
nd
Lien Notes
|
|
Senior Debt
and 1
st
Lien
Notes
|
|
Equity
Shares
|
|
Equity
Warrants
|
|
Total
|
||||||||||
Fair value, beginning of period
|
$
|
699,125,083
|
|
|
$
|
132,929,264
|
|
|
$
|
141,555,369
|
|
|
$
|
3,667,000
|
|
|
$
|
977,276,716
|
|
New investments
|
220,825,664
|
|
|
71,620,633
|
|
|
26,370,669
|
|
|
650,000
|
|
|
319,466,966
|
|
|||||
Investment reclass
|
4,020,247
|
|
|
(4,020,247
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Proceeds from sales of investments
|
—
|
|
|
—
|
|
|
(28,340,004
|
)
|
|
(5,742,355
|
)
|
|
(34,082,359
|
)
|
|||||
Loan origination fees received
|
(4,613,831
|
)
|
|
(1,200,160
|
)
|
|
—
|
|
|
—
|
|
|
(5,813,991
|
)
|
|||||
Principal repayments received
|
(194,883,407
|
)
|
|
(7,727,099
|
)
|
|
—
|
|
|
—
|
|
|
(202,610,506
|
)
|
|||||
PIK interest earned
|
13,784,921
|
|
|
1,449,498
|
|
|
—
|
|
|
—
|
|
|
15,234,419
|
|
|||||
PIK interest payments received
|
(9,326,564
|
)
|
|
(236,150
|
)
|
|
—
|
|
|
—
|
|
|
(9,562,714
|
)
|
|||||
Accretion of loan discounts
|
193,801
|
|
|
203,303
|
|
|
—
|
|
|
—
|
|
|
397,104
|
|
|||||
Accretion of deferred loan origination revenue
|
4,012,181
|
|
|
556,218
|
|
|
—
|
|
|
—
|
|
|
4,568,399
|
|
|||||
Realized gain (loss)
|
(14,752,679
|
)
|
|
(1,560,322
|
)
|
|
15,029,594
|
|
|
3,268,455
|
|
|
1,985,048
|
|
|||||
Unrealized appreciation (depreciation)
|
(28,226,049
|
)
|
|
(371,781
|
)
|
|
(398,971
|
)
|
|
44,900
|
|
|
(28,951,901
|
)
|
|||||
Fair value, end of period
|
$
|
690,159,367
|
|
|
$
|
191,643,157
|
|
|
$
|
154,216,657
|
|
|
$
|
1,888,000
|
|
|
$
|
1,037,907,181
|
|
Year Ended December 31, 2017:
|
Amount of Realized Gain (Loss)
|
Amount of Unrealized Gain (Loss)
|
Amount of Interest or Dividends Credited to Income(2)
|
December 31, 2016
Value
|
Gross Additions
(3)
|
Gross Reductions (4)
|
December 31, 2017
Value
|
|||||||||||||||
Portfolio Company
|
Type of Investment(1)
|
|||||||||||||||||||||
Control Investments:
|
|
|
|
|
|
|
|
|
||||||||||||||
CRS Reprocessing, LLC
|
Debtor in Possession Loan (8% PIK)
|
$
|
(2,634,714
|
)
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
4,000,000
|
|
$
|
4,000,000
|
|
$
|
—
|
|
Senior Notes (
LIBOR + 3.5%
)
(6)
|
(1,938,339
|
)
|
—
|
|
79,534
|
|
2,942,769
|
|
—
|
|
2,942,769
|
|
—
|
|
||||||||
Split Collateral Term Loans (8% Cash)
|
(11,554,845
|
)
|
5,010,464
|
|
513,963
|
|
6,182,000
|
|
11,360,464
|
|
17,542,464
|
|
—
|
|
||||||||
Subordinated Note (5% Cash)
|
(82,335
|
)
|
—
|
|
—
|
|
—
|
|
125,000
|
|
125,000
|
|
—
|
|
||||||||
Series F Preferred Units (705,321 units)
|
(9,134,807
|
)
|
9,134,807
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
||||||||
Common Units (15,174 units)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|
—
|
|
|||||||||
|
(25,345,040
|
)
|
14,145,271
|
|
593,497
|
|
9,124,769
|
|
15,485,464
|
|
24,610,233
|
|
—
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
CRS-SPV, Inc.
|
Common Stock (1,100 shares)
|
—
|
|
1,855,000
|
|
—
|
|
—
|
|
20,283,000
|
|
—
|
|
20,283,000
|
|
|||||||
|
—
|
|
1,855,000
|
|
—
|
|
—
|
|
20,283,000
|
|
—
|
|
20,283,000
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
DCWV Acquisition Corporation
|
Senior Subordinated Note (15% PIK)
|
(250,000
|
)
|
—
|
|
—
|
|
250,000
|
|
—
|
|
250,000
|
|
—
|
|
|||||||
Subordinated Note (12% Cash, 3% PIK)
|
(4,396,350
|
)
|
4,789,633
|
|
—
|
|
1,389,000
|
|
4,789,633
|
|
6,178,633
|
|
—
|
|
||||||||
Jr. Subordinated Note (15% PIK)
|
(2,000,000
|
)
|
2,000,000
|
|
—
|
|
—
|
|
2,000,000
|
|
2,000,000
|
|
—
|
|
||||||||
Series A Preferred Equity (1,200 shares)
|
(1,200,000
|
)
|
1,200,000
|
|
—
|
|
—
|
|
1,200,000
|
|
1,200,000
|
|
—
|
|
||||||||
100% Common Shares
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
||||||||
|
(7,846,350
|
)
|
7,989,633
|
|
—
|
|
1,639,000
|
|
7,989,633
|
|
9,628,633
|
|
—
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
DialogDirect, Inc.
|
Subordinated Note (8% PIK)
|
(7,523,038
|
)
|
6,640,226
|
|
—
|
|
—
|
|
20,020,227
|
|
20,020,227
|
|
—
|
|
|||||||
Class A Common Units (1,176,500 units)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
||||||||
|
(7,523,038
|
)
|
6,640,226
|
|
—
|
|
—
|
|
20,020,227
|
|
20,020,227
|
|
—
|
|
||||||||
|
|
|
|
|
|
|
|
|
Year Ended December 31, 2017:
|
Amount of Realized Gain (Loss)
|
Amount of Unrealized Gain (Loss)
|
Amount of Interest or Dividends Credited to Income(2)
|
December 31, 2016
Value
|
Gross Additions
(3)
|
Gross Reductions (4)
|
December 31, 2017
Value
|
|||||||||||||||
Portfolio Company
|
Type of Investment(1)
|
|||||||||||||||||||||
Frank Entertainment Group, LLC
(7)
|
Senior Note (6% Cash)
(5)
|
$
|
—
|
|
$
|
(3,127,606
|
)
|
$
|
—
|
|
$
|
—
|
|
$
|
9,808,054
|
|
$
|
3,267,054
|
|
$
|
6,541,000
|
|
Second Lien Term Note (2.5% Cash)
(5)
|
—
|
|
(2,705,479
|
)
|
—
|
|
—
|
|
2,715,723
|
|
2,715,723
|
|
—
|
|
||||||||
Redeemable Preferred Units (2,800,000 units)
|
—
|
|
(1,074,000
|
)
|
—
|
|
—
|
|
1,074,000
|
|
1,074,000
|
|
—
|
|
||||||||
Redeemable Class B Preferred Units (2,800,000 units)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
||||||||
Class A Common Units (606,552 units)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
||||||||
|
—
|
|
(6,907,085
|
)
|
—
|
|
—
|
|
13,597,777
|
|
7,056,777
|
|
6,541,000
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
FrontStream Holdings, LLC
|
Subordinate Note (LIBOR + 6%, 7.3% Cash)
|
—
|
|
348,542
|
|
—
|
|
—
|
|
7,663,542
|
|
249,542
|
|
7,414,000
|
|
|||||||
Common Stock (1,000 shares)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
||||||||
|
—
|
|
348,542
|
|
—
|
|
—
|
|
7,663,542
|
|
249,542
|
|
7,414,000
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
Frontstreet Facility Solutions, Inc.
|
Subordinated Note (13% Cash)
|
—
|
|
(1,014,755
|
)
|
569,586
|
|
—
|
|
4,764,755
|
|
1,014,755
|
|
3,750,000
|
|
|||||||
Series A Convertible Preferred Stock (60,000 shares)
|
—
|
|
(575
|
)
|
—
|
|
—
|
|
575
|
|
575
|
|
—
|
|
||||||||
Series B Convertible Preferred Stock (20,000 shares)
|
—
|
|
(144
|
)
|
—
|
|
—
|
|
144
|
|
144
|
|
—
|
|
||||||||
Common Stock (27,890 shares)
|
—
|
|
(279
|
)
|
—
|
|
—
|
|
279
|
|
279
|
|
—
|
|
||||||||
|
—
|
|
(1,015,753
|
)
|
569,586
|
|
—
|
|
4,765,753
|
|
1,015,753
|
|
3,750,000
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
Gerli & Company
|
Subordinated Note (13% Cash)
|
(375,000
|
)
|
375,000
|
|
—
|
|
—
|
|
375,000
|
|
375,000
|
|
—
|
|
|||||||
Subordinated Note (8.5% Cash)
|
(3,000,000
|
)
|
3,000,000
|
|
—
|
|
—
|
|
3,000,000
|
|
3,000,000
|
|
—
|
|
||||||||
Class A Preferred Shares (1,211 shares)
|
(855,000
|
)
|
855,000
|
|
—
|
|
—
|
|
855,000
|
|
855,000
|
|
—
|
|
||||||||
Class C Preferred Shares (744 shares)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
||||||||
Class E Preferred Shares (400 shares)
|
(161,440
|
)
|
161,440
|
|
—
|
|
—
|
|
161,440
|
|
161,440
|
|
—
|
|
||||||||
Common Stock (300 shares)
|
(100,000
|
)
|
100,000
|
|
—
|
|
—
|
|
100,000
|
|
100,000
|
|
—
|
|
||||||||
|
(4,491,440
|
)
|
4,491,440
|
|
—
|
|
—
|
|
4,491,440
|
|
4,491,440
|
|
—
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
SRC Worldwide, Inc.
|
Common Stock (5,000 shares)
|
—
|
|
—
|
|
400,000
|
|
8,028,000
|
|
—
|
|
8,028,000
|
|
—
|
|
|||||||
|
—
|
|
—
|
|
400,000
|
|
8,028,000
|
|
—
|
|
8,028,000
|
|
—
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
Total Control Investments
|
(45,205,868
|
)
|
27,547,274
|
|
1,563,083
|
|
18,791,769
|
|
94,296,836
|
|
75,100,605
|
|
37,988,000
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
|
|
|
|
|
|
|
|
|
Year Ended December 31, 2017:
|
Amount of Realized Gain (Loss)
|
Amount of Unrealized Gain (Loss)
|
Amount of Interest or Dividends Credited to Income(2)
|
December 31, 2016
Value
|
Gross Additions
(3)
|
Gross Reductions (4)
|
December 31, 2017
Value
|
|||||||||||||||
Portfolio Company
|
Type of Investment(1)
|
|||||||||||||||||||||
Affiliate Investments:
|
|
|
|
|
|
|
|
|
||||||||||||||
All Metals Holding, LLC
|
Subordinated Note (12% Cash, 1% PIK)
|
$
|
—
|
|
$
|
155,098
|
|
$
|
878,223
|
|
$
|
6,249,220
|
|
$
|
249,113
|
|
$
|
64,333
|
|
$
|
6,434,000
|
|
Units (318,977 units)
|
—
|
|
(488,000
|
)
|
—
|
|
754,000
|
|
—
|
|
488,000
|
|
266,000
|
|
||||||||
|
—
|
|
(332,902
|
)
|
878,223
|
|
7,003,220
|
|
249,113
|
|
552,333
|
|
6,700,000
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
CIS Secure Computing Inc.
|
Subordinated Note (12% Cash, 3% PIK)
|
—
|
|
—
|
|
1,154,260
|
|
11,670,708
|
|
207,319
|
|
11,878,027
|
|
—
|
|
|||||||
Common Stock (84 shares)
|
1,679,180
|
|
(1,652,680
|
)
|
—
|
|
2,155,000
|
|
1,679,181
|
|
3,834,181
|
|
—
|
|
||||||||
|
1,679,180
|
|
(1,652,680
|
)
|
1,154,260
|
|
13,825,708
|
|
1,886,500
|
|
15,712,208
|
|
—
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
Consolidated Lumber Holdings, LLC
|
Subordinated Note (10% Cash, 2% PIK)
|
—
|
|
(156,611
|
)
|
194,082
|
|
4,278,000
|
|
78,750
|
|
4,356,750
|
|
—
|
|
|||||||
Class A Units (15,000 units)
|
—
|
|
2,019,000
|
|
274,167
|
|
2,481,000
|
|
2,019,000
|
|
—
|
|
4,500,000
|
|
||||||||
|
—
|
|
1,862,389
|
|
468,249
|
|
6,759,000
|
|
2,097,750
|
|
4,356,750
|
|
4,500,000
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
DPII Holdings, LLC
|
Tranche III Subordinated Note (19% PIK)
|
(2,269,044
|
)
|
871,000
|
|
—
|
|
2,356,001
|
|
871,000
|
|
3,227,001
|
|
—
|
|
|||||||
Tranche I & II Subordinated Notes (12% Cash, 4% PIK)
|
(462
|
)
|
2,148,462
|
|
—
|
|
—
|
|
2,148,462
|
|
2,148,462
|
|
—
|
|
||||||||
Class A Membership Interest (17,308 units)
|
(1,107,692
|
)
|
1,107,692
|
|
—
|
|
—
|
|
1,107,692
|
|
1,107,692
|
|
—
|
|
||||||||
|
(3,377,198
|
)
|
4,127,154
|
|
—
|
|
2,356,001
|
|
4,127,154
|
|
6,483,155
|
|
—
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
FCL Holding SPV, LLC
|
Class A Interest (24,873 units)
|
—
|
|
(75,000
|
)
|
45,452
|
|
645,000
|
|
—
|
|
75,000
|
|
570,000
|
|
|||||||
Class B Interest (48,427 units)
|
—
|
|
(101,000
|
)
|
—
|
|
101,000
|
|
—
|
|
101,000
|
|
—
|
|
||||||||
Class B Interest (3,746 units)
|
—
|
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||||||
|
—
|
|
(176,000
|
)
|
45,452
|
|
746,000
|
|
—
|
|
176,000
|
|
570,000
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
|
|
|
|
|
|
|
|
|
Year Ended December 31, 2017:
|
Amount of Realized Gain (Loss)
|
Amount of Unrealized Gain (Loss)
|
Amount of Interest or Dividends Credited to Income(2)
|
December 31, 2016
Value
|
Gross Additions
(3)
|
Gross Reductions (4)
|
December 31, 2017
Value
|
|||||||||||||||
Portfolio Company
|
Type of Investment(1)
|
|||||||||||||||||||||
Frank Entertainment Group, LLC
(7)
|
Senior Note (LIBOR + 7%, 10% Cash, 5.8% PIK)
(6)
|
$
|
—
|
|
$
|
(1,077,888
|
)
|
$
|
823,087
|
|
$
|
9,940,684
|
|
$
|
351,600
|
|
$
|
10,292,284
|
|
$
|
—
|
|
Second Lien Term Note (10% Cash)
|
—
|
|
(174,000
|
)
|
15,000
|
|
—
|
|
1,200,000
|
|
1,200,000
|
|
—
|
|
||||||||
Class A Redeemable Preferred Units (10.5% Cash) (196,718 units)
|
—
|
|
(3,492,904
|
)
|
—
|
|
4,566,904
|
|
—
|
|
4,566,904
|
|
—
|
|
||||||||
Class B Redeemable Preferred Units (18,667 units)
|
—
|
|
(1,660,810
|
)
|
—
|
|
1,660,810
|
|
—
|
|
1,660,810
|
|
—
|
|
||||||||
Class C Redeemable Preferred Units (25,846 units)
|
—
|
|
(600,000
|
)
|
—
|
|
600,000
|
|
—
|
|
600,000
|
|
—
|
|
||||||||
Class A Common Units (43,077 units)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
||||||||
Class A Common Warrants
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
||||||||
|
—
|
|
(7,005,602
|
)
|
838,087
|
|
16,768,398
|
|
1,551,600
|
|
18,319,998
|
|
—
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
Mac Land Holdings, Inc.
|
Common Stock (139 shares)
|
—
|
|
(369,000
|
)
|
—
|
|
—
|
|
369,000
|
|
369,000
|
|
—
|
|
|||||||
|
—
|
|
(369,000
|
)
|
—
|
|
—
|
|
369,000
|
|
369,000
|
|
—
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
MS Bakery Holdings, Inc.
|
Preferred Units (233 units)
|
185,133
|
|
(185,133
|
)
|
—
|
|
397,000
|
|
185,133
|
|
582,133
|
|
—
|
|
|||||||
Common B Units (3,000 units)
|
2,087,323
|
|
(2,086,860
|
)
|
—
|
|
2,110,000
|
|
2,087,323
|
|
4,197,323
|
|
—
|
|
||||||||
Common A Units (1,652 units)
|
1,147,007
|
|
(1,147,007
|
)
|
—
|
|
1,162,000
|
|
1,147,007
|
|
2,309,007
|
|
—
|
|
||||||||
|
3,419,463
|
|
(3,419,000
|
)
|
—
|
|
3,669,000
|
|
3,419,463
|
|
7,088,463
|
|
—
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
Native Maine Operations, Inc.
|
Senior Notes (
LIBOR + 9%
)
(6)
|
—
|
|
—
|
|
1,338,898
|
|
—
|
|
18,000,000
|
|
18,000,000
|
|
—
|
|
|||||||
Preferred Units (20,000 units)
|
—
|
|
—
|
|
—
|
|
—
|
|
2,000,000
|
|
2,000,000
|
|
—
|
|
||||||||
|
—
|
|
—
|
|
1,338,898
|
|
—
|
|
20,000,000
|
|
20,000,000
|
|
—
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
NB Products, Inc.
|
Subordinated Note (12% Cash, 2% PIK)
|
—
|
|
—
|
|
3,540,905
|
|
22,751,190
|
|
556,895
|
|
—
|
|
23,308,085
|
|
|||||||
Jr. Subordinated Note (10% PIK)
|
—
|
|
—
|
|
503,674
|
|
4,595,921
|
|
518,671
|
|
—
|
|
5,114,592
|
|
||||||||
Jr. Subordinated Bridge Note (20% PIK)
|
—
|
|
—
|
|
439,568
|
|
1,972,727
|
|
439,568
|
|
—
|
|
2,412,295
|
|
||||||||
Series A Redeemable Senior Preferred Stock (7,839 shares)
|
—
|
|
978,000
|
|
—
|
|
9,412,000
|
|
978,000
|
|
—
|
|
10,390,000
|
|
||||||||
Common Stock (1,668,691 shares)
|
—
|
|
6,265,000
|
|
—
|
|
9,779,000
|
|
6,265,000
|
|
—
|
|
16,044,000
|
|
||||||||
|
—
|
|
7,243,000
|
|
4,484,147
|
|
48,510,838
|
|
8,758,134
|
|
—
|
|
57,268,972
|
|
||||||||
|
|
|
|
|
|
|
|
|
Year Ended December 31, 2017:
|
Amount of Realized Gain (Loss)
|
Amount of Unrealized Gain (Loss)
|
Amount of Interest or Dividends Credited to Income(2)
|
December 31, 2016
Value
|
Gross Additions
(3)
|
Gross Reductions (4)
|
December 31, 2017
Value
|
|||||||||||||||
Portfolio Company
|
Type of Investment(1)
|
|||||||||||||||||||||
Passport Food Group, LLC
|
Senior Notes (LIBOR + 9.0%, 10.3% Cash)
(6)
|
$
|
—
|
|
$
|
(2,976,160
|
)
|
$
|
1,621,494
|
|
$
|
—
|
|
$
|
19,648,160
|
|
$
|
2,976,160
|
|
$
|
16,672,000
|
|
Common Stock (20,000 shares)
|
—
|
|
(1,643,000
|
)
|
—
|
|
—
|
|
2,000,000
|
|
1,643,000
|
|
357,000
|
|
||||||||
|
—
|
|
(4,619,160
|
)
|
1,621,494
|
|
—
|
|
21,648,160
|
|
4,619,160
|
|
17,029,000
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
PCX Aerostructures, LLC
|
Subordinated Note (10.5% Cash)
(8)
|
—
|
|
(1,481,848
|
)
|
3,354,176
|
|
21,960,000
|
|
2,095,848
|
|
1,481,848
|
|
22,574,000
|
|
|||||||
Subordinated Note (6% PIK)
(8)
|
—
|
|
(211,286
|
)
|
—
|
|
—
|
|
759,286
|
|
211,286
|
|
548,000
|
|
||||||||
Series A Preferred Stock (6,066 shares)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
||||||||
Series B Preferred Stock (411 shares)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
||||||||
Class A Common Stock (121,922 shares)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
||||||||
|
—
|
|
(1,693,134
|
)
|
3,354,176
|
|
21,960,000
|
|
2,855,134
|
|
1,693,134
|
|
23,122,000
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
Team Waste, LLC
|
Subordinated Note (10% Cash, 2% PIK)
|
—
|
|
—
|
|
171,863
|
|
—
|
|
4,930,962
|
|
—
|
|
4,930,962
|
|
|||||||
Preferred Units (500,000 units)
|
—
|
|
—
|
|
9,000
|
|
9,100,000
|
|
900,000
|
|
—
|
|
10,000,000
|
|
||||||||
|
—
|
|
—
|
|
180,863
|
|
9,100,000
|
|
5,830,962
|
|
—
|
|
14,930,962
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
Technology Crops, LLC
|
Subordinated Notes (12% Cash)
|
—
|
|
(3,677,102
|
)
|
1,930,662
|
|
11,837,622
|
|
456,480
|
|
3,677,102
|
|
8,617,000
|
|
|||||||
Common Units (50 units)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
||||||||
|
—
|
|
(3,677,102
|
)
|
1,930,662
|
|
11,837,622
|
|
456,480
|
|
3,677,102
|
|
8,617,000
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
TGaS Advisors, LLC
|
Senior Note (10% Cash, 1% PIK)
|
—
|
|
—
|
|
1,143,884
|
|
9,521,986
|
|
158,001
|
|
248,972
|
|
9,431,015
|
|
|||||||
Preferred Units (1,685,357 units)
|
—
|
|
254,000
|
|
—
|
|
1,270,000
|
|
254,000
|
|
—
|
|
1,524,000
|
|
||||||||
|
—
|
|
254,000
|
|
1,143,884
|
|
10,791,986
|
|
412,001
|
|
248,972
|
|
10,955,015
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
Tulcan Fund IV, L.P.
|
Common Units (1,000,000 units)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||||
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
United Retirement Plan Consultants, Inc.
|
Series A Preferred Shares (9,400 shares)
|
—
|
|
45,000
|
|
—
|
|
257,000
|
|
45,000
|
|
—
|
|
302,000
|
|
|||||||
Common Shares (100,000 shares)
|
—
|
|
118,000
|
|
—
|
|
301,000
|
|
118,000
|
|
—
|
|
419,000
|
|
||||||||
|
—
|
|
163,000
|
|
—
|
|
558,000
|
|
163,000
|
|
—
|
|
721,000
|
|
||||||||
|
|
|
|
|
|
|
|
|
Year Ended December 31, 2017:
|
Amount of Realized Gain (Loss)
|
Amount of Unrealized Gain (Loss)
|
Amount of Interest or Dividends Credited to Income(2)
|
December 31, 2016
Value
|
Gross Additions
(3)
|
Gross Reductions (4)
|
December 31, 2017
Value
|
|||||||||||||||
Portfolio Company
|
Type of Investment(1)
|
|||||||||||||||||||||
Waste Recyclers Holdings, LLC
|
Class A Preferred Units (280 units)
|
$
|
(2,251,100
|
)
|
$
|
2,251,100
|
|
$
|
—
|
|
$
|
—
|
|
$
|
2,251,100
|
|
$
|
2,251,100
|
|
$
|
—
|
|
Class B Preferred Units (11,484,867 units)
|
(2,935,218
|
)
|
2,487,218
|
|
—
|
|
817,000
|
|
2,487,218
|
|
3,304,218
|
|
—
|
|
||||||||
Common Unit Purchase Warrant (1,170,083 units)
|
(748,900
|
)
|
748,900
|
|
—
|
|
—
|
|
748,900
|
|
748,900
|
|
—
|
|
||||||||
Common Units (153,219 units)
|
(180,783
|
)
|
180,783
|
|
—
|
|
—
|
|
180,783
|
|
180,783
|
|
—
|
|
||||||||
|
(6,116,001
|
)
|
5,668,001
|
|
—
|
|
817,000
|
|
5,668,001
|
|
6,485,001
|
|
—
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
Wythe Will Tzetzo, LLC
|
Series A Preferred Units (99,829 units)
|
—
|
|
(4,120,000
|
)
|
—
|
|
6,808,000
|
|
—
|
|
4,120,000
|
|
2,688,000
|
|
|||||||
|
—
|
|
(4,120,000
|
)
|
—
|
|
6,808,000
|
|
—
|
|
4,120,000
|
|
2,688,000
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
Investments not held at the end of the period
|
|
414,889
|
|
—
|
|
—
|
|
—
|
|
414,889
|
|
414,889
|
|
—
|
|
|||||||
Deferred taxes
|
|
—
|
|
390,990
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
Total Affiliate Investments
|
$
|
(3,979,667
|
)
|
$
|
(7,356,046
|
)
|
$
|
17,438,395
|
|
$
|
161,510,773
|
|
$
|
79,907,341
|
|
$
|
94,316,165
|
|
$
|
147,101,949
|
|
(1)
|
All debt investments are income producing, unless otherwise noted. Equity and equity-linked investments are non-income producing, unless otherwise noted. The fair values of all investments were determined using significant unobservable inputs.
|
(2)
|
Represents the total amount of interest, fees or dividends credited to income for the portion of the year an investment was included in Control or Affiliate categories, respectively. Amounts include accrued PIK interest if the description of the security includes disclosure of a PIK interest rate.
|
(3)
|
Gross additions include increase in the cost basis of investments resulting from new portfolio investments, follow-on investments and accrued PIK interest. Gross additions also include net increases in unrealized appreciation or net decreases in unrealized depreciation.
|
(4)
|
Gross reductions include decreases in the total cost basis of investments resulting from principal or PIK repayments or sales. Gross reductions also include net increases in unrealized depreciation or net decreases in unrealized appreciation.
|
(5)
|
Non-accrual investment
|
(6)
|
Index-based floating interest rate is subject to contractual minimum interest rate. A majority of the variable rate loans in the Company's investment portfolio bear interest at a rate that may be determined by reference to either LIBOR or an alternate Base Rate (commonly based on the Federal Funds Rate or the Prime Rate), which typically resets semi-annually, quarterly, or monthly at the borrower's option. The borrower may also elect to have multiple interest reset periods for each loan.
|
(7)
|
During the year ended December 31, 2017, as a result of a balance sheet restructuring, Frank Entertainment Group, LLC moved from an affiliate investment to a control investment.
|
(8)
|
Effective February 9, 2018, the Company's debt investments in PCX Aerostructures, LLC were amended to provide for cash interest at all-in rate of 6% per annum.
|
Year Ended December 31, 2016:
|
Amount of Realized Gain (Loss)
|
Amount of Unrealized Gain (Loss)
|
Amount of Interest or Dividends Credited to Income(2)
|
December 31, 2015
Value
|
Gross Additions
(3)
|
Gross Reductions(4)
|
December 31, 2016
Value
|
|||||||||||||||
Portfolio Company
|
Type of Investment(1)
|
|||||||||||||||||||||
Control Investments:
|
|
|
|
|
|
|
|
|
||||||||||||||
CRS Reprocessing, LLC
|
Senior Notes (
LIBOR + 3.5%, 4.3% Cash
)
(6)
|
$
|
—
|
|
$
|
—
|
|
$
|
120,067
|
|
$
|
2,942,769
|
|
$
|
—
|
|
$
|
—
|
|
$
|
2,942,769
|
|
Split Collateral Term Loans (8% Cash)
|
—
|
|
(5,010,464
|
)
|
897,649
|
|
6,192,464
|
|
5,000,000
|
|
5,010,464
|
|
6,182,000
|
|
||||||||
Series F Preferred Units (705,321 units)
|
—
|
|
(5,221,000
|
)
|
—
|
|
5,221,000
|
|
—
|
|
5,221,000
|
|
—
|
|
||||||||
Common Units (15,174 units)
|
—
|
|
—
|
|
333
|
|
—
|
|
—
|
|
|
—
|
|
|||||||||
|
—
|
|
(10,231,464
|
)
|
1,018,049
|
|
14,356,233
|
|
5,000,000
|
|
10,231,464
|
|
9,124,769
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
DCWV Acquisition Corporation
|
Senior Subordinated Note (15% PIK)
(5)
|
—
|
|
—
|
|
—
|
|
250,000
|
|
—
|
|
—
|
|
250,000
|
|
|||||||
Subordinated Note (12% Cash, 3% PIK)
(5)
|
—
|
|
(1,728,000
|
)
|
—
|
|
3,117,000
|
|
—
|
|
1,728,000
|
|
1,389,000
|
|
||||||||
Jr. Subordinated Note (15% PIK)
(5)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
||||||||
Series A Preferred Equity (1,200 shares)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
||||||||
100% Common Shares
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
||||||||
|
—
|
|
(1,728,000
|
)
|
—
|
|
3,367,000
|
|
—
|
|
1,728,000
|
|
1,639,000
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
Gerli & Company
|
Subordinated Note (13% Cash)
(5)
|
—
|
|
(375,000
|
)
|
—
|
|
375,000
|
|
—
|
|
375,000
|
|
—
|
|
|||||||
Subordinated Note (8.5% Cash)
(5)
|
—
|
|
(437,000
|
)
|
—
|
|
437,000
|
|
—
|
|
437,000
|
|
—
|
|
||||||||
Class A Preferred Shares (1,211 shares)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
||||||||
Class C Preferred Shares (744 shares)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
||||||||
Class E Preferred Shares (400 shares)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
||||||||
Common Stock (300 shares)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
||||||||
|
—
|
|
(812,000
|
)
|
—
|
|
812,000
|
|
—
|
|
812,000
|
|
—
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
SRC Worldwide, Inc.
|
Common Stock (5,000 shares)
|
—
|
|
1,307,000
|
|
700,000
|
|
6,921,000
|
|
1,307,000
|
|
200,000
|
|
8,028,000
|
|
|||||||
|
—
|
|
1,307,000
|
|
700,000
|
|
6,921,000
|
|
1,307,000
|
|
200,000
|
|
8,028,000
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
Total Control Investments
|
—
|
|
(11,464,464
|
)
|
1,718,049
|
|
25,456,233
|
|
6,307,000
|
|
12,971,464
|
|
18,791,769
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
Affiliate Investments:
|
|
|
|
|
|
|
|
|
||||||||||||||
All Aboard America! Holdings Inc.
|
Subordinated Note (12% Cash, 3% PIK)
|
—
|
|
—
|
|
2,440,362
|
|
14,953,191
|
|
577,433
|
|
15,530,624
|
|
—
|
|
|||||||
Membership Units in LLC
|
3,118,958
|
|
(2,723,218
|
)
|
—
|
|
5,024,000
|
|
3,118,958
|
|
8,142,958
|
|
—
|
|
||||||||
|
3,118,958
|
|
(2,723,218
|
)
|
2,440,362
|
|
19,977,191
|
|
3,696,391
|
|
23,673,582
|
|
—
|
|
||||||||
|
|
|
|
|
|
|
|
|
Year Ended December 31, 2016:
|
Amount of Realized Gain (Loss)
|
Amount of Unrealized Gain (Loss)
|
Amount of Interest or Dividends Credited to Income(2)
|
December 31, 2015
Value
|
Gross Additions
(3)
|
Gross Reductions(4)
|
December 31, 2016
Value
|
|||||||||||||||
Portfolio Company
|
Type of Investment(1)
|
|||||||||||||||||||||
All Metals Holding, LLC
|
Subordinated Note (12% Cash, 1% PIK)
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
6,249,220
|
|
$
|
—
|
|
$
|
6,249,220
|
|
Units (318,977 units)
|
—
|
|
(55,331
|
)
|
—
|
|
—
|
|
809,331
|
|
55,331
|
|
754,000
|
|
||||||||
|
—
|
|
(55,331
|
)
|
—
|
|
—
|
|
7,058,551
|
|
55,331
|
|
7,003,220
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
American De-Rosa Lamparts, LLC and Hallmark Lighting, LLC
|
Subordinated Note (12% Cash, 3% PIK)
|
—
|
|
—
|
|
663,502
|
|
7,186,235
|
|
227,130
|
|
7,413,365
|
|
—
|
|
|||||||
Membership Units (8,364 units)
|
3,555,652
|
|
(3,251,347
|
)
|
102,800
|
|
3,872,000
|
|
3,555,652
|
|
7,427,652
|
|
—
|
|
||||||||
|
3,555,652
|
|
(3,251,347
|
)
|
766,302
|
|
11,058,235
|
|
3,782,782
|
|
14,841,017
|
|
—
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
CIS Secure Computing Inc.
|
Subordinated Note (12% Cash, 3% PIK)
|
—
|
|
—
|
|
1,757,750
|
|
11,323,440
|
|
347,268
|
|
—
|
|
11,670,708
|
|
|||||||
Common Stock (84 shares)
|
—
|
|
1,956,000
|
|
—
|
|
199,000
|
|
1,956,000
|
|
—
|
|
2,155,000
|
|
||||||||
|
—
|
|
1,956,000
|
|
1,757,750
|
|
11,522,440
|
|
2,303,268
|
|
—
|
|
13,825,708
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
Consolidated Lumber Company LLC
|
Subordinated Note (10% Cash, 2% PIK)
|
—
|
|
156,611
|
|
1,480,383
|
|
14,332,445
|
|
564,627
|
|
10,619,072
|
|
4,278,000
|
|
|||||||
Class A Units (15,000 units)
|
—
|
|
981,000
|
|
451,128
|
|
1,500,000
|
|
981,000
|
|
—
|
|
2,481,000
|
|
||||||||
|
—
|
|
1,137,611
|
|
1,931,511
|
|
15,832,445
|
|
1,545,627
|
|
10,619,072
|
|
6,759,000
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
DPII Holdings, LLC
|
Tranche I & II Subordinated Notes (12% Cash, 4% PIK)
(5)
|
—
|
|
(871,000
|
)
|
115,147
|
|
3,558,804
|
|
5,708
|
|
1,208,511
|
|
2,356,001
|
|
|||||||
Tranche III Subordinated Note (19% PIK)
(5)
|
—
|
|
(2,148,462
|
)
|
—
|
|
—
|
|
2,148,462
|
|
2,148,462
|
|
—
|
|
||||||||
Class A Membership Interest (17,308 units)
|
—
|
|
(795,000
|
)
|
—
|
|
795,000
|
|
—
|
|
795,000
|
|
—
|
|
||||||||
|
—
|
|
(3,814,462
|
)
|
115,147
|
|
4,353,804
|
|
2,154,170
|
|
4,151,973
|
|
2,356,001
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
FCL Holding SPV, LLC
|
Class A Interest (24,873 units)
|
—
|
|
195,000
|
|
—
|
|
—
|
|
645,000
|
|
—
|
|
645,000
|
|
|||||||
Class B Interest (48,427 units)
|
—
|
|
101,000
|
|
—
|
|
—
|
|
101,000
|
|
—
|
|
101,000
|
|
||||||||
Class B Interest (3,746 units)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
||||||||
|
—
|
|
296,000
|
|
—
|
|
—
|
|
746,000
|
|
—
|
|
746,000
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
Frank Entertainment Group, LLC
|
Senior Note (LIBOR + 7%, 10% Cash, 5.8% PIK)
(6)
|
—
|
|
—
|
|
1,599,606
|
|
9,592,545
|
|
605,281
|
|
257,142
|
|
9,940,684
|
|
|||||||
Class A Redeemable Preferred Units (10.5% Cash) (196,718 units)
|
—
|
|
—
|
|
324,995
|
|
4,566,904
|
|
—
|
|
—
|
|
4,566,904
|
|
||||||||
Class B Redeemable Preferred Units (18,667 units)
|
—
|
|
—
|
|
—
|
|
1,660,810
|
|
—
|
|
—
|
|
1,660,810
|
|
||||||||
Class C Redeemable Preferred Units (25,846 units)
|
—
|
|
—
|
|
—
|
|
600,000
|
|
—
|
|
—
|
|
600,000
|
|
||||||||
Class A Common Units (43,077 units)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
||||||||
Class A Common Warrants
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
||||||||
|
—
|
|
—
|
|
1,924,601
|
|
16,420,259
|
|
605,281
|
|
257,142
|
|
16,768,398
|
|
||||||||
|
|
|
|
|
|
|
|
|
Year Ended December 31, 2016:
|
Amount of Realized Gain (Loss)
|
Amount of Unrealized Gain (Loss)
|
Amount of Interest or Dividends Credited to Income(2)
|
December 31, 2015
Value
|
Gross Additions
(3)
|
Gross Reductions(4)
|
December 31, 2016
Value
|
|||||||||||||||
Portfolio Company
|
Type of Investment(1)
|
|||||||||||||||||||||
GenPref LLC
|
7.0% LLC Interest
|
$
|
30,823
|
|
$
|
6,762
|
|
$
|
—
|
|
$
|
16,400
|
|
$
|
37,585
|
|
$
|
53,985
|
|
$
|
—
|
|
|
30,823
|
|
6,762
|
|
—
|
|
16,400
|
|
37,585
|
|
53,985
|
|
—
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
MS Bakery Holdings, Inc.
|
Preferred Units (233 units)
|
—
|
|
30,000
|
|
—
|
|
367,000
|
|
30,000
|
|
—
|
|
397,000
|
|
|||||||
Common B Units (3,000 units)
|
—
|
|
303,000
|
|
—
|
|
1,807,000
|
|
303,000
|
|
—
|
|
2,110,000
|
|
||||||||
Common A Units (1,652 units)
|
—
|
|
167,000
|
|
—
|
|
995,000
|
|
167,000
|
|
—
|
|
1,162,000
|
|
||||||||
|
—
|
|
500,000
|
|
—
|
|
3,169,000
|
|
500,000
|
|
—
|
|
3,669,000
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
NB Products, Inc.
|
Subordinated Note (12% Cash, 2% PIK)
|
—
|
|
—
|
|
3,368,353
|
|
20,327,140
|
|
2,424,050
|
|
—
|
|
22,751,190
|
|
|||||||
Jr. Subordinated Note (10% PIK)
|
—
|
|
—
|
|
462,929
|
|
4,126,030
|
|
469,891
|
|
—
|
|
4,595,921
|
|
||||||||
Jr. Subordinated Bridge Note (20% PIK)
|
—
|
|
—
|
|
244,654
|
|
—
|
|
1,972,727
|
|
—
|
|
1,972,727
|
|
||||||||
Series A Redeemable Senior Preferred Stock (7,839 shares)
|
—
|
|
887,000
|
|
—
|
|
8,525,000
|
|
887,000
|
|
—
|
|
9,412,000
|
|
||||||||
Common Stock (1,668,691 shares)
|
—
|
|
5,782,000
|
|
—
|
|
3,997,000
|
|
5,782,000
|
|
—
|
|
9,779,000
|
|
||||||||
|
—
|
|
6,669,000
|
|
4,075,936
|
|
36,975,170
|
|
11,535,668
|
|
—
|
|
48,510,838
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
PCX Aerostructures, LLC
|
Subordinated Note (10.5% Cash)
|
—
|
|
(6,001,060
|
)
|
3,339,521
|
|
18,612,000
|
|
9,409,060
|
|
6,061,060
|
|
21,960,000
|
|
|||||||
Series A Preferred Stock (6,066 shares)
|
—
|
|
(1,912,668
|
)
|
—
|
|
1,191,000
|
|
721,668
|
|
1,912,668
|
|
—
|
|
||||||||
Series B Preferred Stock (411 shares)
|
—
|
|
(410,514
|
)
|
—
|
|
—
|
|
410,514
|
|
410,514
|
|
—
|
|
||||||||
Class A Common Stock (121,922 shares)
|
—
|
|
(3,626
|
)
|
—
|
|
—
|
|
3,626
|
|
3,626
|
|
—
|
|
||||||||
|
—
|
|
(8,327,868
|
)
|
3,339,521
|
|
19,803,000
|
|
10,544,868
|
|
8,387,868
|
|
21,960,000
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
Team Waste, LLC
|
Preferred Units (455,000 units)
|
—
|
|
—
|
|
36,000
|
|
5,500,000
|
|
3,600,000
|
|
—
|
|
9,100,000
|
|
|||||||
|
—
|
|
—
|
|
36,000
|
|
5,500,000
|
|
3,600,000
|
|
—
|
|
9,100,000
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
Technology Crops, LLC
|
Subordinated Notes (12% Cash, 5% PIK)
|
—
|
|
—
|
|
1,944,252
|
|
11,252,123
|
|
585,499
|
|
—
|
|
11,837,622
|
|
|||||||
Common Units (50 units)
|
—
|
|
(400,000
|
)
|
—
|
|
400,000
|
|
—
|
|
400,000
|
|
—
|
|
||||||||
|
—
|
|
(400,000
|
)
|
1,944,252
|
|
11,652,123
|
|
585,499
|
|
400,000
|
|
11,837,622
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
TGaS Advisors, LLC
|
Senior Note (10% Cash, 1% PIK)
|
—
|
|
—
|
|
1,180,938
|
|
9,633,898
|
|
177,061
|
|
288,973
|
|
9,521,986
|
|
|||||||
Preferred Units (1,685,357 units)
|
—
|
|
(27,712
|
)
|
33,000
|
|
1,427,000
|
|
—
|
|
157,000
|
|
1,270,000
|
|
||||||||
|
—
|
|
(27,712
|
)
|
1,213,938
|
|
11,060,898
|
|
177,061
|
|
445,973
|
|
10,791,986
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
Tulcan Fund IV, L.P.
|
Common Units (1,000,000 units)
|
—
|
|
(416,000
|
)
|
—
|
|
416,000
|
|
—
|
|
416,000
|
|
—
|
|
|||||||
|
—
|
|
(416,000
|
)
|
—
|
|
416,000
|
|
—
|
|
416,000
|
|
—
|
|
||||||||
|
|
|
|
|
|
|
|
|
Year Ended December 31, 2016:
|
Amount of Realized Gain (Loss)
|
Amount of Unrealized Gain (Loss)
|
Amount of Interest or Dividends Credited to Income(2)
|
December 31, 2015
Value
|
Gross Additions
(3)
|
Gross Reductions(4)
|
December 31, 2016
Value
|
|||||||||||||||
Portfolio Company
|
Type of Investment(1)
|
|||||||||||||||||||||
UCS Super HoldCo LLC
|
Membership Units (1,000 units)
|
$
|
(2,000,000
|
)
|
$
|
2,000,000
|
|
$
|
—
|
|
$
|
—
|
|
$
|
2,000,000
|
|
$
|
2,000,000
|
|
$
|
—
|
|
Participation Interest
|
(626,437
|
)
|
700,000
|
|
—
|
|
300,000
|
|
700,000
|
|
1,000,000
|
|
—
|
|
||||||||
|
(2,626,437
|
)
|
2,700,000
|
|
—
|
|
300,000
|
|
2,700,000
|
|
3,000,000
|
|
—
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
United Retirement Plan Consultants, Inc.
|
Series A Preferred Shares (9,400 shares)
|
—
|
|
505,252
|
|
—
|
|
446,000
|
|
265,000
|
|
454,000
|
|
257,000
|
|
|||||||
Common Shares (100,000 shares)
|
—
|
|
(599,000
|
)
|
—
|
|
—
|
|
611,000
|
|
310,000
|
|
301,000
|
|
||||||||
|
—
|
|
(93,748
|
)
|
—
|
|
446,000
|
|
876,000
|
|
764,000
|
|
558,000
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
Waste Recyclers Holdings, LLC
|
Class A Preferred Units (280 units)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||||
Class B Preferred Units (11,484,867 units)
|
—
|
|
74,000
|
|
—
|
|
743,000
|
|
74,000
|
|
—
|
|
817,000
|
|
||||||||
Common Unit Purchase Warrant (1,170,083 units)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
||||||||
Common Units (153,219 units)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
||||||||
|
—
|
|
74,000
|
|
—
|
|
743,000
|
|
74,000
|
|
—
|
|
817,000
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
Wythe Will Tzetzo, LLC
|
Series A Preferred Units (99,829 units)
|
—
|
|
(1,528,000
|
)
|
195,997
|
|
8,336,000
|
|
—
|
|
1,528,000
|
|
6,808,000
|
|
|||||||
|
—
|
|
(1,528,000
|
)
|
195,997
|
|
8,336,000
|
|
—
|
|
1,528,000
|
|
6,808,000
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
Investments not held at the end of the period
|
|
319,802
|
|
—
|
|
—
|
|
—
|
|
319,802
|
|
319,802
|
|
—
|
|
|||||||
Deferred taxes
|
|
—
|
|
1,825,301
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
Total Affiliate Investments
|
$
|
4,398,798
|
|
$
|
(5,473,012
|
)
|
$
|
19,741,317
|
|
$
|
177,581,965
|
|
$
|
52,842,553
|
|
$
|
68,913,745
|
|
$
|
161,510,773
|
|
(1)
|
All debt investments are income producing, unless otherwise noted. Equity and equity-linked investments are non-income producing, unless otherwise noted. The fair values of all investments were determined using significant unobservable inputs.
|
(2)
|
Represents the total amount of interest, fees or dividends credited to income for the portion of the year an investment was included in Control or Affiliate categories, respectively. Amounts include accrued PIK interest if the description of the security includes disclosure of a PIK interest rate.
|
(3)
|
Gross additions include increase in the cost basis of investments resulting from new portfolio investments, follow-on investments and accrued PIK interest. Gross additions also include net increases in unrealized appreciation or net decreases in unrealized depreciation.
|
(4)
|
Gross reductions include decreases in the total cost basis of investments resulting from principal or PIK repayments or sales. Gross reductions also include net increases in unrealized depreciation or net decreases in unrealized appreciation.
|
(5)
|
Non-accrual investment
|
(6)
|
Index-based floating interest rate is subject to contractual minimum interest rate. A majority of the variable rate loans in the Company's investment portfolio bear interest at a rate that may be determined by reference to either LIBOR or an alternate Base Rate (commonly based on the Federal Funds Rate or the Prime Rate), which typically resets semi-annually, quarterly, or monthly at the borrower's option. The borrower may also elect to have multiple interest reset periods for each loan.
|
Issuance/Pooling Date
|
|
Maturity Date
|
|
Interest Rate as of December 31, 2017
|
|
December 31,
2017
|
|
December 31,
2016 |
||||
SBA-Guaranteed Debentures:
|
|
|
|
|
|
|
|
|
||||
March 25, 2009
|
|
March 1, 2019
|
|
5.337%
|
|
$
|
22,000,000
|
|
|
$
|
22,000,000
|
|
March 24, 2010
|
|
March 1, 2020
|
|
4.825%
|
|
6,800,000
|
|
|
6,800,000
|
|
||
September 22, 2010
|
|
September 1, 2020
|
|
3.687%
|
|
32,590,000
|
|
|
32,590,000
|
|
||
March 29, 2011
|
|
March 1, 2021
|
|
4.474%
|
|
75,400,000
|
|
|
75,400,000
|
|
||
September 21, 2011
|
|
September 1, 2021
|
|
3.392%
|
|
19,100,000
|
|
|
19,100,000
|
|
||
March 27, 2013
|
|
March 1, 2023
|
|
3.155%
|
|
30,000,000
|
|
|
30,000,000
|
|
||
September 24, 2014
|
|
September 1, 2024
|
|
3.790%
|
|
31,310,000
|
|
|
31,310,000
|
|
||
September 21, 2016
|
|
September 1, 2026
|
|
2.723%
|
|
32,800,000
|
|
|
32,800,000
|
|
||
Less: Deferred financing fees
|
|
|
|
|
|
(3,678,875
|
)
|
|
(4,610,034
|
)
|
||
Total SBA-Guaranteed Debentures
|
|
|
|
|
|
$
|
246,321,125
|
|
|
$
|
245,389,966
|
|
Credit Facility:
|
|
|
|
|
|
|
|
|
||||
May 1, 2017
|
|
April 30, 2022
|
|
4.124%
|
|
$
|
156,070,484
|
|
|
$
|
127,011,475
|
|
Total Credit Facility
|
|
|
|
|
|
$
|
156,070,484
|
|
|
$
|
127,011,475
|
|
Notes:
|
|
|
|
|
|
|
|
|
||||
October 19, 2012
|
|
December 15, 2022
|
|
6.375%
|
|
80,500,000
|
|
|
80,500,000
|
|
||
February 6, 2015
|
|
March 15, 2022
|
|
6.375%
|
|
86,250,000
|
|
|
86,250,000
|
|
||
Less: Deferred financing fees
|
|
|
|
|
|
(3,341,699
|
)
|
|
(3,994,619
|
)
|
||
Total Notes
|
|
|
|
|
|
$
|
163,408,301
|
|
|
$
|
162,755,381
|
|
|
|
December 31,
|
||||||||||
|
|
2017
|
|
2016
|
|
2015
|
||||||
Additional paid in capital
|
|
$
|
(689,101
|
)
|
|
$
|
(484,037
|
)
|
|
$
|
(1,039,969
|
)
|
Investment income in excess of distributions
|
|
$
|
9,761,203
|
|
|
$
|
867,350
|
|
|
$
|
3,585,623
|
|
Accumulated realized gains on investments
|
|
$
|
(9,072,102
|
)
|
|
$
|
(383,313
|
)
|
|
$
|
(2,545,654
|
)
|
|
|
Year Ended December 31,
|
||||||||||
|
|
2017
|
|
2016
|
|
2015
|
||||||
Ordinary income
|
|
$
|
77,484,420
|
|
|
$
|
68,239,124
|
|
|
$
|
68,413,242
|
|
Distributions of long-term capital gains
|
|
—
|
|
|
—
|
|
|
8,242,911
|
|
|||
Distributions on a tax basis
|
|
$
|
77,484,420
|
|
|
$
|
68,239,124
|
|
|
$
|
76,656,153
|
|
|
|
December 31,
|
||||||||||
|
|
2017
|
|
2016
|
|
2015
|
||||||
Undistributed net investment income
|
|
18,384,766
|
|
|
$
|
13,510,440
|
|
|
$
|
19,826,302
|
|
|
Accumulated capital gains (losses)
|
|
(87,489,121
|
)
|
|
(37,164,237
|
)
|
|
(30,555,004
|
)
|
|||
Other permanent differences relating to the Company's formation
|
|
1,975,543
|
|
|
1,975,543
|
|
|
1,975,543
|
|
|||
Other temporary differences
|
|
(7,410,910
|
)
|
|
(4,816,603
|
)
|
|
(3,695,494
|
)
|
|||
Unrealized appreciation (depreciation)
|
|
(107,847,526
|
)
|
|
(49,224,340
|
)
|
|
(28,459,406
|
)
|
|||
Components of distributable earnings at year end
|
|
$
|
(182,387,248
|
)
|
|
$
|
(75,719,197
|
)
|
|
$
|
(40,908,059
|
)
|
|
|
Year Ended December 31,
|
|||||||||||||||||||
|
|
2017
|
|
2016
|
|
2015
|
|||||||||||||||
|
|
Number
of Shares
|
|
Weighted Average
Grant Date Fair
Value per Share
|
|
Number
of Shares
|
|
Weighted Average
Grant Date Fair
Value per Share
|
|
Number
of Shares
|
|
Weighted Average
Grant Date Fair
Value per Share
|
|||||||||
Unvested shares, beginning of period
|
|
631,622
|
|
|
$
|
21.23
|
|
|
778,116
|
|
|
$
|
24.10
|
|
|
662,965
|
|
|
$
|
25.87
|
|
Shares granted during the period
|
|
360,470
|
|
|
$
|
19.22
|
|
|
364,605
|
|
|
$
|
17.56
|
|
|
360,840
|
|
|
$
|
21.82
|
|
Shares vested during the period
|
|
(243,418
|
)
|
|
$
|
22.69
|
|
|
(511,099
|
)
|
|
$
|
22.98
|
|
|
(245,689
|
)
|
|
$
|
24.31
|
|
Unvested shares, end of period
|
|
748,674
|
|
|
$
|
19.79
|
|
|
631,622
|
|
|
$
|
21.23
|
|
|
778,116
|
|
|
$
|
24.10
|
|
Portfolio Company
|
Investment Type
|
December 31, 2017
|
|
December 31, 2016
|
||||
DPII Holdings, LLC
|
Guaranty
|
$
|
—
|
|
|
$
|
576,925
|
|
Deva Holdings, Inc.
|
Revolver
|
2,500,000
|
|
|
—
|
|
||
DLC Acquisition, LLC
|
Revolver
|
1,800,000
|
|
|
3,000,000
|
|
||
Frank Entertainment Group, LLC(1)
|
Delayed Draw Senior
|
130,212
|
|
|
—
|
|
||
Frank Entertainment Group, LLC(1)
|
Delayed Draw Second Lien
|
303,827
|
|
|
—
|
|
||
Halo Branded Solutions, Inc.
|
Delayed Draw Term Loan
|
—
|
|
|
3,250,000
|
|
||
HKW Capital Partners IV, L.P.
|
Private Equity
|
214,823
|
|
|
530,032
|
|
||
ICP Industries Inc.
|
Delayed Draw Term Loan
|
5,000,000
|
|
|
—
|
|
||
Lakeview Health Acquisition Company(1)
|
Revolver
|
1,387,367
|
|
|
1,387,367
|
|
||
Micross Solutions, LLC
|
Delayed Draw Term Loan
|
3,000,000
|
|
|
—
|
|
||
Nautic Partners VII, LP
|
Private Equity
|
509,080
|
|
|
642,172
|
|
||
Nomacorc, LLC(1)
|
Equity Investment
|
838,813
|
|
|
849,362
|
|
||
Orchid Underwriters Agency, LLC
|
Delayed Draw Term Loan
|
649,143
|
|
|
8,400,000
|
|
||
Orchid Underwriters Agency, LLC
|
Revolver
|
—
|
|
|
5,000,000
|
|
||
SCA Pharmaceuticals, LLC
|
Delayed Draw Term Loan
|
—
|
|
|
12,000,000
|
|
||
Schweiger Dermatology Group, LLC
|
Delayed Draw Term Loan
|
4,500,000
|
|
|
—
|
|
||
SCUF Gaming, Inc.
|
Revolver
|
2,000,000
|
|
|
3,500,000
|
|
||
Smile Brands, Inc.
|
Equity Investment
|
1,000,000
|
|
|
1,000,000
|
|
||
Smile Brands, Inc.
|
Delayed Draw Term Loan
|
18,826,531
|
|
|
18,826,531
|
|
||
SPC Partners V, LP
|
Private Equity
|
185,297
|
|
|
522,881
|
|
||
SPC Partners VI, LP
|
Private Equity
|
2,792,172
|
|
|
3,000,000
|
|
||
Tate's Bake Shop
|
Revolver
|
550,000
|
|
|
—
|
|
||
Team Waste, LLC
|
Equity Investment
|
—
|
|
|
900,000
|
|
||
TGaS Advisors, LLC
|
Revolver
|
2,000,000
|
|
|
2,000,000
|
|
||
YummyEarth Inc.
|
Delayed Draw Term Loan
|
—
|
|
|
1,500,000
|
|
||
Total Unused Commitments
|
|
$
|
48,187,265
|
|
|
$
|
66,885,270
|
|
(1)
|
Represents a commitment to extend financing to a portfolio company where one or more of the Company's current investments in the portfolio company are carried at less than cost as of
December 31, 2017
. The Company's estimate of the fair value of the current investments in this portfolio company includes an analysis of the value of any unfunded commitments.
|
Year ending December 31,
|
Rent Commitment
|
||
2018
|
435,571
|
|
|
2019
|
187,637
|
|
|
Total
|
$
|
623,208
|
|
|
|
|
|
Year Ended December 31,
|
||||||||||||||||||
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
||||||||||
Per share data:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net asset value at beginning of period
|
|
$
|
15.13
|
|
|
$
|
15.23
|
|
|
$
|
16.11
|
|
|
$
|
16.10
|
|
|
$
|
15.30
|
|
Net investment income(1)
|
|
1.55
|
|
|
1.62
|
|
|
2.16
|
|
|
2.08
|
|
|
2.23
|
|
|||||
Net realized gain (loss) on investments(1)
|
|
(1.11
|
)
|
|
0.05
|
|
|
(0.83
|
)
|
|
0.46
|
|
|
0.67
|
|
|||||
Net unrealized appreciation (depreciation) on investments / foreign currency(1)
|
|
(1.04
|
)
|
|
(0.72
|
)
|
|
0.17
|
|
|
(1.48
|
)
|
|
0.08
|
|
|||||
Total increase (decrease) from investment operations(1)
|
|
(0.60
|
)
|
|
0.95
|
|
|
1.50
|
|
|
1.06
|
|
|
2.98
|
|
|||||
Dividends paid to stockholders from net investment income
|
|
(1.65
|
)
|
|
(1.89
|
)
|
|
(2.11
|
)
|
|
(1.88
|
)
|
|
(2.14
|
)
|
|||||
Dividends paid to stockholders from realized gains
|
|
—
|
|
|
—
|
|
|
(0.25
|
)
|
|
(0.68
|
)
|
|
(0.02
|
)
|
|||||
Total dividends paid
|
|
(1.65
|
)
|
|
(1.89
|
)
|
|
(2.36
|
)
|
|
(2.56
|
)
|
|
(2.16
|
)
|
|||||
Common stock offerings
|
|
0.61
|
|
|
0.72
|
|
|
—
|
|
|
1.49
|
|
|
—
|
|
|||||
Stock-based compensation(1)
|
|
(0.01
|
)
|
|
0.09
|
|
|
0.01
|
|
|
—
|
|
|
(0.03
|
)
|
|||||
Shares issued pursuant to Dividend Reinvestment Plan
|
|
0.01
|
|
|
0.04
|
|
|
0.03
|
|
|
0.04
|
|
|
0.04
|
|
|||||
Loss on extinguishment of debt(1)
|
|
—
|
|
|
—
|
|
|
(0.04
|
)
|
|
—
|
|
|
(0.01
|
)
|
|||||
Provision for taxes(1)
|
|
(0.02
|
)
|
|
(0.01
|
)
|
|
(0.01
|
)
|
|
(0.10
|
)
|
|
(0.02
|
)
|
|||||
Other(2)
|
|
(0.04
|
)
|
|
—
|
|
|
(0.01
|
)
|
|
0.08
|
|
|
—
|
|
|||||
Net asset value at end of period
|
|
$
|
13.43
|
|
|
$
|
15.13
|
|
|
$
|
15.23
|
|
|
$
|
16.11
|
|
|
$
|
16.10
|
|
Market value at end of period(3)
|
|
$
|
9.49
|
|
|
$
|
18.34
|
|
|
$
|
19.11
|
|
|
$
|
20.29
|
|
|
$
|
27.65
|
|
Shares outstanding at end of period
|
|
47,740,832
|
|
|
40,401,292
|
|
|
33,375,126
|
|
|
32,950,288
|
|
|
27,697,483
|
|
|||||
Net assets at end of period
|
|
$
|
641,275,374
|
|
|
$
|
611,156,258
|
|
|
$
|
508,367,755
|
|
|
$
|
530,826,629
|
|
|
$
|
445,792,130
|
|
Average net assets
|
|
$
|
667,188,287
|
|
|
$
|
556,549,060
|
|
|
$
|
524,579,829
|
|
|
$
|
482,679,489
|
|
|
$
|
434,926,009
|
|
Ratio of total operating expenses, including loss on extinguishment of debt and provision for taxes, to average net assets
|
|
7.74
|
%
|
|
9.93
|
%
|
|
9.81
|
%
|
|
9.45
|
%
|
|
9.30
|
%
|
|||||
Ratio of net investment income to average net assets
|
|
10.83
|
%
|
|
10.58
|
%
|
|
13.65
|
%
|
|
12.85
|
%
|
|
14.15
|
%
|
|||||
Portfolio turnover ratio
|
|
37.02
|
%
|
|
24.61
|
%
|
|
37.62
|
%
|
|
29.21
|
%
|
|
25.96
|
%
|
|||||
Total return(4)
|
|
(42.15
|
)%
|
|
5.86
|
%
|
|
5.82
|
%
|
|
(17.36
|
)%
|
|
16.95
|
%
|
|||||
Supplemental Data:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Efficiency ratio(5)
|
|
17.48
|
%
|
|
24.70
|
%
|
|
18.88
|
%
|
|
20.40
|
%
|
|
19.07
|
%
|
(1)
|
Weighted average basic per share data.
|
(2)
|
Represents the impact of the different share amounts used in calculating per share data as a result of calculating certain per share data based upon the weighted average basic shares outstanding during the period and certain per share data based on the shares outstanding as of a period end or transaction date.
|
(3)
|
Represents the closing price of the Company’s common stock on the last day of the period.
|
(4)
|
Total return is based on purchase of stock at the current market price on the first day and a sale at the current market price on the last day of each period reported on the table and assumes reinvestment of dividends at prices obtained by the Company's dividend reinvestment plan during the period. Total return is not annualized.
|
(5)
|
Efficiency ratio equals the sum of (i) compensation and related expenses and (ii) general and administrative expenses divided by total investment income.
|
|
|
Quarter Ended
|
||||||||||||||
|
|
March 31,
2017 |
|
June 30,
2017 |
|
September 30,
2017 |
|
December 31,
2017 |
||||||||
Total investment income
|
|
$
|
30,190,770
|
|
|
$
|
31,213,767
|
|
|
$
|
29,888,058
|
|
|
$
|
31,712,037
|
|
Net investment income
|
|
17,819,433
|
|
|
19,350,962
|
|
|
17,150,917
|
|
|
17,916,505
|
|
||||
Net increase (decrease) in net assets resulting from operations
|
|
7,193,240
|
|
|
(2,027,746
|
)
|
|
(57,496,676
|
)
|
|
23,680,721
|
|
||||
Net investment income per share
|
|
$
|
0.42
|
|
|
$
|
0.41
|
|
|
$
|
0.36
|
|
|
$
|
0.38
|
|
|
|
Quarter Ended
|
||||||||||||||
|
|
March 31,
2016 |
|
June 30,
2016 |
|
September 30,
2016 |
|
December 31,
2016 |
||||||||
Total investment income
|
|
$
|
26,655,870
|
|
|
$
|
28,421,860
|
|
|
$
|
27,412,457
|
|
|
$
|
31,189,370
|
|
Net investment income
|
|
9,598,083
|
|
|
16,338,913
|
|
|
15,831,157
|
|
|
17,108,720
|
|
||||
Net increase in net assets resulting from operations
|
|
12,427,258
|
|
|
6,686,827
|
|
|
7,879,673
|
|
|
7,262,674
|
|
||||
Net investment income per share
|
|
$
|
0.29
|
|
|
$
|
0.49
|
|
|
$
|
0.42
|
|
|
$
|
0.42
|
|
Number
|
|
Exhibit
|
|
|
|
10.23†
|
|
|
|
|
|
10.24†
|
|
|
|
|
|
10.25†
|
|
|
11
|
|
|
|
|
|
21.1
|
|
|
|
|
|
23.1
|
|
|
|
|
|
31.1
|
|
|
|
|
|
31.2
|
|
|
|
|
|
32.1
|
|
|
|
|
|
32.2
|
|
†
|
Management contract or compensatory plan or arrangement.
|
*
|
Filed herewith.
|
**
|
Furnished herewith.
|
1.
|
Definitions
. For purposes of this Agreement:
|
a.
|
“Adjudged” shall mean adjudged finally by a court or arbitral or other authority of competent jurisdiction.
|
b.
|
“Change in Control” means a change in control of the Company occurring after the Effective Date of a nature that would be required to be reported in response to Item 6(e) of Schedule 14A of Regulation 14A (or in response to any similar item on any similar schedule or form) promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), whether or not the Company is then subject to such reporting requirement; provided, however, that, without limitation, such a Change in Control shall be deemed to have occurred if, after the Effective Date (i) any “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act) is or becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing 50% or more of the combined voting power of all of the Company’s then-outstanding securities entitled to vote generally in the election of directors without the prior approval of at least two-thirds of the members of the Board of Directors in office immediately prior
|
c.
|
“Corporate Status” means the status of a person as a present or former director, officer, employee or agent of the Company or as a director, trustee, officer, partner, manager, managing member, fiduciary, employee or agent of any other foreign or domestic corporation, partnership, limited liability company, joint venture, trust, employee benefit plan or other enterprise that such person is or was serving in such capacity at the request of the Company. As a clarification and without limiting the circumstances in which Indemnitee may be serving at the request of the Company, service by Indemnitee shall be deemed to be at the request of the Company: (i) if Indemnitee serves or served as a director, trustee, officer, partner, manager, managing member, fiduciary, employee or agent of any foreign or domestic corporation, partnership, limited liability company, joint venture, trust, employee benefit plan or other enterprise (A) of which a majority of the voting power or equity interest is or was owned directly or indirectly by the Company, or (B) the management of which is controlled directly or indirectly by the Company; or (ii) if, as a result of Indemnitee’s service to the Company, Indemnitee is subject to duties by, or required to perform services for, an employee benefit plan or its participants or beneficiaries, including as a deemed fiduciary thereof.
|
d.
|
“Disinterested Director” means a director of the Company who is not and was not a party to the Proceeding in respect of which indemnification and/or advancement of Expenses is sought by Indemnitee.
|
e.
|
“Effective Date” has the meaning set forth in the first paragraph of this Agreement.
|
f.
|
“Enterprise” shall mean (i) the Company and (ii) any other corporation, partnership, limited liability company, joint venture, trust, employee benefit plan or other enterprise which is an affiliate or wholly or partially owned subsidiary of the Company and of which the Indemnitee is or was serving as a director, trustee, general partner, managing member, officer, employee, agent or fiduciary; and (iii) any other
|
g.
|
“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.
|
h.
|
“Expenses” means any and all disbursements or expenses incurred by Indemnitee in connection with prosecuting, defending, preparing to prosecute or defend, investigating, being or preparing to be a witness in or otherwise participating in a Proceeding, including, without limitation, reasonable and out-of-pocket attorneys’ fees and costs, retainers, court costs, arbitration and mediation costs, transcript costs, fees of experts, witness fees, travel expenses, duplicating costs, printing and binding costs, telephone charges, postage, delivery service fees, federal, state, local or foreign taxes imposed on Indemnitee as a result of the actual or deemed receipt of any payments under this Agreement and any ERISA excise taxes and penalties. Expenses shall also include (i) expenses incurred in connection with any appeal resulting from any Proceeding including, without limitation, the premium for, security for and other costs relating to any cost bond, supersedeas bond or other appeal bond or its equivalent, (ii) expenses incurred in connection with recovery under any directors’ and officers’ liability insurance policies maintained by the Company, and (iii) expenses incurred by Indemnitee in establishing or enforcing [his][her] right to indemnification or reimbursement under this Agreement.
|
i.
|
“Independent Counsel” means a law firm, or a member of a law firm, that is experienced in matters of corporation law and neither is, nor in the past five years has been, retained to represent: (i) the Company or Indemnitee in any matter material to either such party (other than with respect to matters concerning Indemnitee under this Agreement or of other indemnitees under similar indemnification agreements), or (ii) any other party to or participant or witness in the Proceeding giving rise to a claim for indemnification or advancement of Expenses hereunder. Notwithstanding the foregoing, the term “Independent Counsel” shall not include any person who, under the applicable standards of professional conduct then prevailing, would have a conflict of interest in representing either the Company or Indemnitee in an action to determine Indemnitee’s rights under this Agreement.
|
j.
|
“Jointly Indemnifiable Claims” shall mean any Proceeding for which the Indemnitee shall be entitled to indemnification, advancement of expenses or insurance from (i) the Company and/or any Enterprise pursuant to this Agreement, the charter or Bylaws or other governing documents of the Company or any Enterprise, any agreement or a resolution of the stockholders of the Company entitled to vote generally in the election of directors or of the Board of Directors, or otherwise, on the one hand, and (ii) any Third-Party Indemnitor pursuant to any agreement between any Third-Party Indemnitor and the Indemnitee pursuant to which the Indemnitee is indemnified, the laws of the jurisdiction of incorporation or organization of any Third-Party Indemnitor and/or the certificate of incorporation, certificate of organization, bylaws,
|
k.
|
“Proceeding” means any threatened, pending or completed action, suit, arbitration, mediation, alternate dispute resolution mechanism, investigation, inquiry, administrative hearing, claim, demand or discovery request or any other actual, threatened or completed proceeding, whether brought by or in the right of the Company or otherwise and whether of a civil (including intentional or unintentional tort claims), criminal, administrative or investigative (formal or informal) nature, including any appeal therefrom. If Indemnitee reasonably believes that a given situation may lead to or culminate in the institution of a Proceeding, such situation shall also be considered a Proceeding. The term “Proceeding” shall be broadly construed and shall include, without limitation, the investigation, preparation, defense, settlement, arbitration or appeal of, and the giving of testimony in or related to, any threatened, pending or completed claim, action, suit or other proceeding, whether of a civil, criminal, administrative or investigative nature.
|
l.
|
“Third-Party Indemnitor” means any person or entity that has or may in the future provide to the Indemnitee any indemnification, exoneration, hold harmless or Expense advancement rights and/or insurance benefits other than (i) the Company, (ii) any Enterprise and (iii) any entity or entities through which the Company maintains liability insurance applicable to the Indemnitee.
|
2.
|
Services by Indemnitee
. The Company expressly confirms and agrees that it has entered into this Agreement and assumed the obligations imposed on it hereby in order to induce the Indemnitee to [continue to] serve as [a director/an officer] of the Company, and the Company acknowledges that Indemnitee is relying upon this Agreement in [continuing to serve/serving] in such capacity. However, this Agreement shall not impose any independent obligation on Indemnitee or the Company to continue Indemnitee’s service to the Company beyond any period otherwise required by law or by other agreements or commitments of the parties, if any. This Agreement shall not be deemed an employment contract between the Company (or any other entity) and Indemnitee.
|
3.
|
Indemnification
. The Company shall indemnify and hold harmless, and advance Expenses to, Indemnitee (a) as provided in this Agreement and (b) otherwise to the maximum extent not prohibited by (and not merely to the extent affirmatively permitted by) Maryland law in effect on the Effective Date and as amended from time to time; provided, however, that no change in Maryland law shall have the effect of reducing the benefits available to Indemnitee hereunder based on Maryland law as in effect on the Effective Date. The rights of Indemnitee provided in this Section 3 shall include, without limitation, the rights set forth in the other sections of this Agreement, including any additional indemnification permitted by the charter or bylaws of the Company or Section 2-418(b) of the Maryland General Corporation Law (the “MGCL”).
|
4.
|
Standard for Indemnification
. If, by reason of Indemnitee’s Corporate Status, Indemnitee is, or is threatened to be, made a party to any Proceeding, the Company shall indemnify and hold harmless Indemnitee against all judgments, penalties, fines and amounts paid in settlement and all Expenses actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf in connection with any such Proceeding unless (and only to the extent) it is ultimately Adjudged that (i) the act or omission of Indemnitee was material to the matter giving rise to the Proceeding and (A) was committed in bad faith or (B) was the result of active and deliberate dishonesty; (ii) Indemnitee actually received an improper personal benefit in money, property or services; or (iii) in the case of any criminal Proceeding, Indemnitee had reasonable cause to believe that [his][her] conduct was unlawful.
|
5.
|
Certain Limitations
. Indemnitee shall not be entitled to:
|
a.
|
indemnification hereunder if the Proceeding was one by or in the right of the Company and Indemnitee is Adjudged to be liable to the Company;
|
b.
|
indemnification hereunder if Indemnitee is Adjudged to be liable on the basis that personal benefit was improperly received in any Proceeding charging improper personal benefit to Indemnitee; or
|
c.
|
indemnification or advancement of Expenses hereunder if the Proceeding was brought by Indemnitee, unless: (i) the Proceeding was brought to establish or enforce indemnification rights under this Agreement, and then only to the extent in accordance with and as authorized by Section 12 of this Agreement, or (ii) the Company’s charter or bylaws, a resolution of the stockholders entitled to vote generally in the election of directors or of the Board of Directors or an agreement approved by the Board of Directors to which the Company is a party, expressly provides otherwise.
|
6.
|
Court-Ordered Indemnification
. Notwithstanding any other provision of this Agreement (other than Section 16), a court of appropriate jurisdiction, upon application of Indemnitee and such notice as the court shall require, may order indemnification of Indemnitee by the Company in the following circumstances:
|
a.
|
if such court determines that Indemnitee is entitled to reimbursement under Section 2-418(d)(1) of the MGCL, the court shall order indemnification, in which case Indemnitee shall be entitled to recover the Expenses of securing such reimbursement; or
|
b.
|
if such court determines that Indemnitee is fairly and reasonably entitled to indemnification in view of all the relevant circumstances, whether or not Indemnitee
|
7.
|
Partial Success
. In addition to any other right to indemnification under any provision of this Agreement, and without limiting any such provision, if Indemnitee is not wholly successful in a Proceeding but is successful, on the merits or otherwise, as to one or more but less than all claims, issues or matters in such Proceeding, the Company shall indemnify Indemnitee under this Section 7 for all Expenses actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf in connection with each successfully resolved claim, issue or matter, allocated on a reasonable and proportionate basis. For purposes of this Section 7, and without limitation, the termination of any claim, issue or matter in such a Proceeding by dismissal, with or without prejudice, shall be deemed to be a successful result as to such claim, issue or matter. For the avoidance of doubt, in the event that Indemnitee is not wholly successful and is Adjudged liable, the Company shall indemnify Indemnitee to the maximum extent not prohibited by (and not merely to the extent affirmatively permitted by) Maryland law and as permitted by Sections 3, 4 5 and 6 of this Agreement.
|
8.
|
Advancement of Expenses
. If Indemnitee was, is, or is threatened to be, made a party to (or otherwise becomes a participant in) any Proceeding, the Company shall, without requiring a preliminary determination of Indemnitee’s ultimate entitlement to indemnification hereunder, advance all reasonable Expenses incurred by or on behalf of Indemnitee in connection with such Proceeding. Such advance or advances shall be made within fifteen (15) days after the receipt by the Company of a statement or statements requesting such advance or advances from time to time, whether prior to or after final disposition of such Proceeding, and may be in the form of, in the reasonable discretion of Indemnitee (but without duplication): (i) payment of such Expenses directly to third parties on behalf of Indemnitee; (ii) advancement to Indemnitee of funds in an amount sufficient to pay such Expenses; or (iii) reimbursement to Indemnitee for Indemnitee’s payment of such Expenses. Such statement or statements shall reasonably evidence the Expenses incurred by Indemnitee and shall include or be preceded or accompanied by a written affirmation and undertaking by or on behalf of Indemnitee, in substantially the form attached hereto as
Exhibit A
or in such form as may be required under applicable law as in effect at the time of the execution thereof, to reimburse the portion (if any) of any Expenses advanced to Indemnitee relating to claims, issues or matters in the Proceeding as to which it shall ultimately be Adjudged by clear and convincing evidence, that the standard of conduct has not been met by Indemnitee and which have not been successfully resolved as described in Section 7 of this Agreement. For so long as the Company is subject to the Investment Company Act of 1940 (the “Investment Company Act”), any advancement of Expenses shall be subject to at least
|
9.
|
Indemnitee as Witness or Other Participant
. Notwithstanding any other provision of this Agreement, to the extent that Indemnitee was, is or may be, by reason of Indemnitee’s Corporate Status, made a witness or otherwise asked to participate in any Proceeding, whether instituted by the Company or any other party, and to which Indemnitee is not a party, Indemnitee shall be advanced all reasonable Expenses and indemnified and held harmless against all Expenses actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf in connection therewith within fifteen (15) days after the receipt by the Company of a statement or statements requesting any such advance or indemnification from time to time, whether prior to or after final disposition of such Proceeding. Such statement or statements shall reasonably evidence the Expenses incurred by Indemnitee. In connection with any such advancement of Expenses, the Company may require Indemnitee to provide a written affirmation and undertaking substantially in the form attached hereto as
Exhibit A
.
|
10.
|
Procedure for Determination of Entitlement to Indemnification
.
|
a.
|
To obtain indemnification under this Agreement, Indemnitee shall submit to the Company a written request, including therein or therewith such documentation and information as is reasonably available to Indemnitee and is reasonably necessary or appropriate to determine whether and to what extent Indemnitee is entitled to indemnification. Indemnitee may submit one or more such requests from time to time and at such time(s) as Indemnitee deems appropriate in Indemnitee’s sole discretion. The officer of the Company receiving any such request from Indemnitee shall, promptly upon receipt of such a request for indemnification, advise the Board of Directors of the Company that Indemnitee has requested indemnification by the Company.
|
b.
|
Upon written request by Indemnitee for indemnification pursuant to Section 10(a) above, a determination, if required by applicable law, with respect to Indemnitee’s entitlement thereto shall promptly be made in the specific case: (i) if a Change in Control shall have occurred, by Independent Counsel in a written opinion to the
|
c.
|
The Company agrees to pay the reasonable fees and expenses of any Independent Counsel and to fully indemnify such counsel against any and all Expenses, claims, liabilities and damages arising out of or relating to this Agreement or its engagement pursuant hereto. In no event shall the Indemnitee be required or requested to pay any such fees or expenses or to provide any such indemnification.
|
11.
|
Presumptions and Effect of Certain Proceedings
.
|
a.
|
In making any determination with respect to entitlement to indemnification hereunder, the person or persons or entity making such determination shall presume that Indemnitee is entitled to indemnification under this Agreement if Indemnitee has submitted a request for indemnification in accordance with Section 10(a) of this Agreement, and the Company shall have the burden to overcome that presumption in connection with the making of any determination contrary to that presumption.
|
b.
|
The termination of any Proceeding or of any claim, issue or matter therein, by judgment, order, settlement or conviction, upon a plea of nolo contendere or its equivalent, or entry of an order of probation prior to judgment, does not create a presumption that Indemnitee did not meet the requisite standard of conduct described herein for indemnification.
|
c.
|
The knowledge and/or actions, or failure to act, of any other director, officer, employee or agent of the Company or any other director, trustee, officer, partner, manager, managing member, fiduciary, employee or agent of any other foreign or domestic corporation, partnership, limited liability company, joint venture, trust, employee benefit plan or other enterprise shall not be imputed to Indemnitee for purposes of determining any right to indemnification under this Agreement.
|
d.
|
For purposes of any determination as to Indemnitee’s entitlement to indemnification, Indemnitee shall be presumed to have met the standard of conduct for indemnification if, among other things and without limitation, Indemnitee relied on any information, opinion, report or statement, including any financial statement or other financial data or the records or books of account of the Company or any Enterprise, prepared or presented by an officer or employee of the Company or any Enterprise whom Indemnitee reasonably believed to be reliable and competent in the matters presented, by a lawyer, certified public accountant, appraiser or other person, as to a matter which Indemnitee reasonably believed to be within the person’s professional or expert competence, or, if Indemnitee was serving on the Board of Directors of the Company or as a member of any similar body of any Enterprise, by a committee of the Board of Directors or such other body on which Indemnitee does not serve, as to a matter within its designated authority, if Indemnitee reasonably believes the committee to merit confidence. The provisions of this Section 11(d) shall not be deemed to be exclusive or to limit in any way the other circumstances in which Indemnitee met, or be presumed to have met, the applicable standard of conduct set forth in this Agreement.
|
e.
|
For purposes of this Agreement, Indemnitee shall be considered to have been wholly successful with respect to any Proceeding if such Proceeding is disposed of, on the merits or otherwise (including a disposition without prejudice), without (i) the disposition being adverse to Indemnitee, (ii) it being Adjudged that Indemnitee was liable to the Company, (iii) a plea of guilty by Indemnitee, (iv) it being Adjudged that an act or omission of Indemnitee was material to the matter giving rise to the Proceeding and was (A) committed in bad faith or (B) the result of Indemnitee’s active and deliberate dishonesty, (v) it being Adjudged that Indemnitee actually received an improper personal benefit in money, property or services or (vi) with respect to any criminal proceeding, it being Adjudged that Indemnitee had reasonable cause to believe the act or omission was unlawful.
|
12.
|
Remedies of Indemnitee
.
|
a.
|
If (i) a determination is made pursuant to Section 10(b) of this Agreement that Indemnitee is not entitled to indemnification under this Agreement; (ii) advancement of Expenses is not timely made pursuant to Sections 8 or 9 of this Agreement; (iii) no determination of entitlement to indemnification shall have been made pursuant to Section 10(b) of this Agreement within sixty (60) days after receipt by the Company of the request for indemnification; (iv) payment of indemnification is not made pursuant to Sections 7 or 9 of this Agreement within fifteen (15) days after receipt by the Company of a written request therefor; or (v) payment of indemnification pursuant to any other section of this Agreement or the charter or bylaws of the Company is not made within fifteen (15) days after a determination has been made that Indemnitee is entitled to indemnification, Indemnitee shall be entitled to an adjudication in an appropriate court located in the State of Maryland or in any other court of competent jurisdiction, with regard to Indemnitee’s entitlement to indemnification or advancement of Expenses. Alternatively, Indemnitee, at Indemnitee’s option, may seek an award in arbitration to be conducted by a single arbitrator pursuant to the Commercial Arbitration Rules of the American Arbitration Association. Indemnitee shall commence a proceeding seeking an adjudication or an award in arbitration within one hundred eighty (180) days following the date on which Indemnitee first has the right to commence such proceeding pursuant to this Section 12(a); provided, however, that the foregoing clause shall not apply to a proceeding brought by Indemnitee to enforce [his][her] rights under Section 7 of this Agreement. Except as set forth herein, the provisions of Maryland law (without regard to its conflicts of laws rules) shall apply to any such arbitration. The Company shall not oppose Indemnitee’s right to seek any such adjudication or award in arbitration.
|
b.
|
In any judicial proceeding or arbitration commenced pursuant to this Section 12, Indemnitee shall be presumed to be entitled to indemnification or advancement of Expenses, as the case may be, under this Agreement and the Company shall have the burden of proving that Indemnitee is not entitled to indemnification or advancement of Expenses, as the case may be. If Indemnitee commences a judicial proceeding or arbitration pursuant to this Section 12, Indemnitee shall not be required to reimburse the Company for any advances pursuant to Section 8 of this Agreement until a final determination is made with respect to Indemnitee’s entitlement to indemnification (as to which all rights of appeal have been exhausted or lapsed). The Company shall, to the fullest extent not prohibited by law, be precluded from asserting in any judicial proceeding or arbitration commenced pursuant to this Section 12 that the procedures and presumptions of this Agreement are not valid, binding and enforceable and shall stipulate in any such court or before any such arbitrator that the Company is bound by all of the provisions of this Agreement.
|
c.
|
If a determination shall have been made pursuant to Section 10(b) of this Agreement that Indemnitee is entitled to indemnification, the Company shall be bound by such determination in any judicial proceeding or arbitration commenced pursuant to this Section 12, absent a misstatement by Indemnitee of a material fact, or an omission of a material fact necessary to make Indemnitee’s statement not materially misleading, in connection with the request for indemnification that was not disclosed in connection with the determination.
|
d.
|
In the event that Indemnitee, pursuant to this Section 12, seeks a judicial adjudication of or an award in arbitration to enforce Indemnitee’s rights under, or to recover damages for breach of, this Agreement, Indemnitee shall be entitled to advancement from the Company, and shall be indemnified and held harmless by the Company for, any and all Expenses actually and reasonably incurred by [him][her] in such judicial adjudication or arbitration. If it shall be determined in such judicial adjudication or arbitration that Indemnitee is entitled to receive part but not all of the indemnification or advancement of Expenses sought, the Expenses incurred by Indemnitee in connection with such judicial adjudication or arbitration shall be appropriately prorated.
|
e.
|
Interest shall be paid by the Company to Indemnitee at the maximum rate allowed to be charged for judgments under the Courts and Judicial Proceedings Article of the Annotated Code of Maryland for amounts which the Company pays or is obligated to pay for the period (i) commencing with either the 10
th
day after the date on which the Company was requested to advance Expenses in accordance with Sections 8 or 9 of this Agreement or the 60th day after the date on which the Company was requested to make the determination of entitlement to indemnification under Section 10(b) of this Agreement, as applicable, and (ii) ending on the date such payment is made to Indemnitee by the Company.
|
13.
|
Defense of Underlying Proceeding
.
|
a.
|
Indemnitee shall notify the Company promptly in writing upon being served with or receiving any summons, citation, subpoena, complaint, indictment, notice, request or other document relating to any Proceeding which may result in the right to indemnification or the advancement of Expenses hereunder and shall include with such notice a description of the nature of the Proceeding and a summary of the facts underlying the Proceeding. The failure to give any such notice shall not disqualify Indemnitee from the right, or otherwise affect in any manner any right of Indemnitee, to indemnification or the advancement of Expenses under this Agreement unless the Company’s ability to defend in such Proceeding or to obtain proceeds under any insurance policy is materially and adversely prejudiced thereby, and then only to the extent the Company is thereby actually so prejudiced.
|
b.
|
Subject to the provisions of the last sentence of this Section 13(b) and of Section 13(c) below, the Company shall have the right to defend Indemnitee in any Proceeding which may give rise to indemnification hereunder using a law firm of the Company’s choice, subject to the prior written approval of the Indemnitee, which shall not be unreasonably withheld; provided, however, that the Company shall notify Indemnitee in writing of any such decision to defend within fifteen (15) calendar days following receipt of notice of any such Proceeding under Section 13(a) above. Indemnitee shall have the right to retain a separate law firm in any such Proceeding at Indemnitee’s sole expense. The Company shall not, without the prior written consent of Indemnitee, which shall not be unreasonably withheld or delayed, consent to the entry of any judgment against Indemnitee or enter into any settlement or compromise of a claim against Indemnitee which (i) includes an admission of fault of Indemnitee; (ii) does not include, as an unconditional term thereof, (A) the full release with prejudice of Indemnitee from all liability in respect of such Proceeding, which release shall be in form and substance reasonably satisfactory to Indemnitee and (B) the complete dismissal of all claims against the Indemnitee with prejudice; or (iii) would impose any Expense, judgment, fine, penalty or limitation on Indemnitee. This Section 13(b) shall not apply to a Proceeding brought by Indemnitee under Section 12 of this Agreement, a Proceeding by or in the right of the Company or in the case of clause (ii) of Section 13(c).
|
c.
|
Notwithstanding the provisions of Section 13(b) above, if in a Proceeding to which Indemnitee is a party, (i) Indemnitee reasonably concludes, based upon advice of counsel approved by the Company, which approval shall not be unreasonably withheld or delayed, that Indemnitee may have separate defenses or counterclaims to assert with respect to any issue which may not be consistent with other defendants in such Proceeding, (ii) Indemnitee reasonably concludes, based upon advice of counsel approved by the Company, which approval shall not be unreasonably withheld or delayed, that an actual or apparent conflict of interest or potential conflict of interest exists between Indemnitee and the Company, or (iii) if the Company fails to assume the defense of such Proceeding in a timely manner, Indemnitee shall be entitled to be represented by separate legal counsel of Indemnitee’s choice, subject, except in the case of (ii) or (iii) above, to the prior approval of the Company, which approval shall not be unreasonably withheld or delayed, at the expense of the Company. In addition, if the Company fails to comply with any of its obligations under this Agreement or in the event that the Company or any other person takes any action to declare this Agreement void or unenforceable, or institutes any Proceeding to deny or to recover from Indemnitee the benefits intended to be provided to Indemnitee hereunder, Indemnitee shall have the right to retain counsel of Indemnitee’s choice, subject to the prior approval of the Company, which approval shall not be unreasonably withheld or delayed, at the expense of the Company (subject to Section 12(d) of this Agreement), to represent Indemnitee in connection with any such matter.
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14.
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Jointly Indemnifiable Claims
. Given that certain Jointly Indemnifiable Claims may arise, the Company acknowledges and agrees that the Company shall, and to the extent applicable shall cause any Enterprise to (i) be fully and primarily responsible for, and be the indemnitor of first resort with respect to, payment to or payment on behalf of the Indemnitee in respect of indemnification or advancement of Expenses in connection with any such Jointly Indemnifiable Claim, irrespective of any right of recovery the Indemnitee may have from the Third-Party Indemnitors, and (ii) be required to advance the full amount of Expenses incurred by the Indemnitee and shall be liable for the full amount of all Expenses, judgments, fines, penalties and amounts paid in settlement to the extent not prohibited by (and not merely to the extent affirmatively permitted by) applicable law and as required by the terms of this Agreement, without regard to any rights the Indemnitee may have against the Third-Party Indemnitors. Under no circumstance shall the Company or any Enterprise be entitled to, and the Company hereby irrevocably waives, relinquishes and releases, any claims against the Third-Party Indemnitors for subrogation, contribution or recovery of any kind and no right of advancement or recovery the Indemnitee may have from the Third-Party Indemnitors shall reduce or otherwise alter the rights of the Indemnitee or the obligations of the Company or any Enterprise. The Company further agrees that no advancement or payment by any Third-Party Indemnitor on behalf of Indemnitee with respect to any Proceeding for which Indemnitee has sought indemnification, exoneration or hold harmless rights from the Company shall affect the foregoing and the Third-Party Indemnitor(s) shall have a right to receive from the Company, contribution and/or be subrogated, to the extent of such advancement or payment to all of the rights of recovery of Indemnitee against the Company. The Company and the Indemnitee agree that each of the Third-Party Indemnitors shall be third-party beneficiaries with respect to this Agreement entitled to enforce this Section 14 as though each such Third-Party Indemnitor were a party to this Agreement.
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15.
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Non-Exclusivity; Survival of Rights; Subrogation
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a.
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The rights of indemnification and advancement of Expenses as provided by this Agreement shall not be deemed exclusive of any other rights to which Indemnitee may at any time be entitled under (i) applicable law (including, but not limited to, the MGCL), (ii) the charter or bylaws of the Company, (iii) any agreement or (iv) a resolution of (A) the stockholders entitled to vote generally in the election of directors or (B) the Board of Directors, or otherwise. Unless consented to in writing by Indemnitee, no amendment, alteration or repeal of this Agreement or of any provision hereof shall limit or restrict any right of Indemnitee under this Agreement in respect of any action taken or omitted by such Indemnitee in [his][her] Corporate Status prior to such amendment, alteration or repeal, regardless of whether a claim with respect to such action or inaction is raised prior or subsequent to such amendment, alteration or repeal. No right or remedy herein conferred is intended to be exclusive of any other right or remedy, and every other right or remedy shall be cumulative and in addition to every other right or remedy given hereunder or now or hereafter existing at law or in equity or otherwise. The assertion of any right or remedy
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b.
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Except as set forth in Section 14, in the event of any payment under this Agreement, the Company shall be subrogated to the extent of such payment to all of the rights of recovery of Indemnitee, who shall execute all papers required and take all action necessary to secure such rights, including execution of such documents as are necessary to enable the Company to bring suit to enforce such rights.
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16.
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Insurance
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a.
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The Company shall purchase and maintain a policy or policies of directors and officers insurance with reputable insurance companies. The Company shall continue to provide such insurance coverage to Indemnitee and such insurance policies shall have coverage terms and policy limits at least as favorable to Indemnitee as the insurance coverage provided to any other director or officer of the Company. If the Company has such insurance in effect at the time it receives from Indemnitee any notice of the commencement of an action, suit, proceeding or other claim, the Company shall give prompt notice of the commencement of such action, suit, proceeding or other claim to the insurers and take such other actions in accordance with the procedures set forth in the policy as required or appropriate to secure coverage of Indemnitee for such action, suit, proceeding or other claim. The Company shall thereafter take all reasonably necessary or desirable action to cause such insurers to pay, on behalf of Indemnitee, all amounts payable as a result of such action, suit, proceeding or other claim in accordance with the terms of such policy. In the event of a Change in Control that would result in a loss or cancellation of the Company directors’ and officers’ insurance policy or policies, the Company shall purchase a directors and officers “Tail” insurance policy or policies to provide coverage to the Company’s directors and officers for a period of six (6) years after such Change in Control, but only with respect to coverage for claims arising from wrongful acts, errors or omissions occurring before such Change in Control.
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b.
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Without in any way limiting any other obligation under this Agreement, the Company shall indemnify Indemnitee for any payment by Indemnitee which would otherwise be indemnifiable hereunder arising out of the amount of any deductible or retention and the amount of any excess of the aggregate of all judgments, penalties, fines, settlements and Expenses incurred by Indemnitee in connection with a Proceeding over the coverage of any insurance referred to in Section 16(a). The purchase, establishment and maintenance of any such insurance shall not in any way limit or affect the rights or obligations of the Company or Indemnitee under this Agreement except as expressly provided herein, and the execution and delivery of this Agreement by the Company and Indemnitee shall not in any way limit or affect the rights or
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17.
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Other Sources; Investment Company Act
. Notwithstanding any other provision of this Agreement, the Company shall not be liable under this Agreement to make any payment of amounts otherwise indemnifiable or payable or reimbursable as Expenses hereunder if and to the extent that (i) Indemnitee has otherwise actually received such payment under any insurance policy, contract, agreement or otherwise, except as otherwise provided in Section 14 to this Agreement, or (ii) for so long as the Company is subject to the Investment Company Act, indemnification or payment or reimbursement of Expenses would not be permissible under the Investment Company Act, whether pursuant to Section 17(h) of the Investment Company Act or otherwise. In addition, for so long as the Company is subject to the Investment Company Act of 1940, the presumptions, considerations and similar provisions set forth in Section 11(d) and (e) of this Agreement shall be of no force or effect to the extent inconsistent with the Investment Company Act and shall otherwise be construed in a manner to include any additional conditions, restrictions or references required to be contained therein by the Investment Company Act, including, without limitation, the disabling conduct set forth in Section 17(h) of the Investment Company Act.
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18.
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Contribution
. If the indemnification provided in this Agreement is unavailable in whole or in part and may not be paid to Indemnitee for any reason, other than for failure to satisfy the standard of conduct set forth in Section 4 or due to the provisions of Section 5, then, with respect to any Proceeding in which the Company is jointly liable with Indemnitee (or would be if joined in such Proceeding), to the fullest extent permissible under applicable law, the Company, in lieu of indemnifying and holding harmless Indemnitee, shall pay, in the first instance, the entire amount incurred by Indemnitee, whether for Expenses, judgments, penalties, and/or amounts paid or to be paid in settlement, in connection with any Proceeding without requiring Indemnitee to contribute to such payment, and the Company hereby waives and relinquishes any right of contribution it may have at any time against Indemnitee.
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19.
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Miscellaneous
.
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a.
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This Agreement shall be effective as of the Effective Date and may apply to acts or omissions of Indemnitee taken in or in connection with Indemnitee’s Corporate Status which occurred prior to such date if Indemnitee was an officer, director, employee or agent of the Company or was a director, trustee, officer, partner, manager, managing member, fiduciary, employee or agent of any Enterprise at the time such act or omission occurred.
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b.
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This Agreement shall continue until and terminate on the later of: (i) the date that Indemnitee shall have ceased to serve as a director, officer, employee or agent of the Company or as a director, trustee, officer, partner, manager, managing member, fiduciary, employee or agent of any other foreign or domestic corporation, partnership, limited liability company, joint venture, trust, employee benefit plan or other enterprise that such person is or was serving in such capacity at the request of the Company and (ii) the date that Indemnitee is no longer subject to any actual or possible Proceeding (including any rights of appeal thereto and any Proceeding commenced by Indemnitee pursuant to Section 12 of this Agreement).
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c.
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The indemnification and advancement of Expenses provided by, or granted pursuant to, this Agreement shall be binding upon and be enforceable by the parties hereto and their respective successors and assigns (including any direct or indirect successor by purchase, merger, consolidation or otherwise to all, substantially all or a substantial part, of the business and/or assets of the Company), shall continue as to an Indemnitee who has ceased to be a director, officer, employee or agent of the Company or a director, trustee, officer, partner, manager, managing member, fiduciary, employee or agent of any other foreign or domestic corporation, partnership, limited liability company, joint venture, trust, employee benefit plan or other enterprise that such person is or was serving in such capacity at the request of the Company, and shall inure to the benefit of Indemnitee and Indemnitee’s spouse, assigns, heirs, devisees, executors and administrators and other legal representatives.
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d.
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If, by reason of Indemnitee’s Corporate Status, Indemnitee’s spouse is made a party to any Proceeding, the Company shall indemnify and hold harmless Indemnitee’s spouse against all judgments, penalties, fines and amounts paid in settlement and all Expenses actually and reasonably incurred by Indemnitee’s spouse in connection with any such Proceeding unless (and only to the extent) it is ultimately Adjudged that (a) the act or omission of Indemnitee was material to the matter giving rise to the Proceeding and (i) was committed in bad faith or (ii) was the result of active and deliberate dishonesty; (b) Indemnitee actually received an improper personal benefit in money, property or services; or (c) in the case of any criminal Proceeding, Indemnitee had reasonable cause to believe that [his][her] conduct was unlawful. Further, Indemnitee’s spouse shall not be entitled to (x) indemnification hereunder if the Proceeding was one by or in the right of the Company and Indemnitee is Adjudged to be liable to the Company; (y) indemnification hereunder if Indemnitee is Adjudged to be liable on the basis that personal benefit was improperly received in any Proceeding charging improper personal benefit to Indemnitee; or (z) indemnification or advancement of Expenses hereunder if the Proceeding was brought by Indemnitee, unless: (i) the Proceeding was brought to establish or enforce indemnification rights under this Agreement, and then only to the extent in accordance with and as authorized by Section 12 of this Agreement, or (ii) the Company’s charter or bylaws, a resolution of the stockholders entitled to vote
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e.
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The Company shall require and cause any successor (whether direct or indirect by purchase, merger, consolidation or otherwise) to all, substantially all or a substantial part, of the business and/or assets of the Company, by written agreement in form and substance satisfactory to Indemnitee, expressly to assume and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform if no such succession had taken place.
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f.
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The Company and Indemnitee agree that a monetary remedy for breach of this Agreement, at some later date, may be inadequate, impracticable and difficult to prove, and further agree that such breach may cause Indemnitee irreparable harm. Accordingly, the parties hereto agree that Indemnitee may enforce this Agreement by seeking injunctive relief and/or specific performance hereof, without any necessity of showing actual damage or irreparable harm and that by seeking injunctive relief and/or specific performance, Indemnitee shall not be precluded from seeking or obtaining any other relief to which Indemnitee may be entitled. Indemnitee shall further be entitled to such injunctive relief and/or specific performance, including temporary restraining orders, preliminary injunctions and permanent injunctions, without the necessity of posting bonds or other undertakings in connection therewith. The Company acknowledges that, in the absence of a waiver, a bond or undertaking may be required of Indemnitee by a court, and the Company hereby waives any such requirement of such a bond or undertaking.
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g.
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If any provision or provisions of this Agreement shall be held to be invalid, void, illegal or otherwise unenforceable for any reason whatsoever: (i) the validity, legality and enforceability of the remaining provisions of this Agreement (including, without limitation, each portion of any Section, paragraph or sentence of this Agreement containing any such provision held to be invalid, illegal or unenforceable that is not itself invalid, illegal or unenforceable) shall not in any way be affected or impaired thereby and shall remain enforceable to the fullest extent permitted by law; (ii) such provision or provisions shall be deemed reformed to the extent necessary to conform
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h.
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No supplement, modification or amendment of this Agreement shall be binding unless executed in writing by both of the parties hereto. No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provisions hereof (whether or not similar) nor, unless otherwise expressly stated, shall such waiver constitute a continuing waiver.
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i.
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All notices, requests, demands and other communications hereunder shall be in writing and shall be deemed to have been duly given if (i) delivered by hand or overnight courier service and receipted for by the party to whom said notice, request, demand or other communication shall have been directed, on the day of such delivery, or (ii) mailed by certified or registered mail with postage prepaid, on the third business day after the date on which it is so mailed: (i) if to Indemnitee, to the address set forth on the signature page hereto; or (ii) if to the Company, to Triangle Capital Corporation, 3700 Glenwood Avenue, Suite 530, Raleigh, NC 27612, Attn: Corporate Secretary; or to such other address as may have been furnished in writing to Indemnitee by the Company or to the Company by Indemnitee, as the case may be.
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j.
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This Agreement shall be governed by, and construed and enforced in accordance with, the laws of the State of Maryland, without regard to its conflicts of laws rules.
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k.
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This Agreement may be executed in one or more counterparts (delivery of which may be in electronic format), each of which shall for all purposes be deemed to be an original and all of which together shall constitute one and the same Agreement. One such counterpart signed by the party against whom enforceability is sought shall be sufficient to evidence the existence of this Agreement.
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By:
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Name:
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Title:
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Address:
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POSITION
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BASE
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SENIORITY
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MAXIMUM
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Vice President (or above)
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12 weeks
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2 weeks/Year of Service
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35 weeks
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Non-officer
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6 weeks
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2 weeks/Year of Service
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35 weeks
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/s/ E. Ashton Poole
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February 8, 2018
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E. Ashton Poole, Chief Executive Officer
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(1)
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Registration Statement (Form S-8 No. 333-218459) pertaining to the Triangle Capital Corporation Omnibus Incentive Plan,
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(2)
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Registration Statement (Form S-8 No. 333-141827) pertaining to the Triangle Capital Corporation Amended and Restated 2007 Equity Incentive Plan, and
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(3)
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Registration Statement (Form S-8 No.333-185892), pertaining to the Triangle Capital Corporation 2007 Equity Incentive Plan;
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1.
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I have reviewed this annual report on Form 10-K of Triangle Capital Corporation;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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(a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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(a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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/s/ E. ASHTON POOLE
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E. Ashton Poole
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Chief Executive Officer
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February 28, 2018
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1.
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I have reviewed this annual report on Form 10-K of Triangle Capital Corporation;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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(a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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(a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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/s/ STEVEN C. LILLY
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Steven C. Lilly
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Chief Financial Officer
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February 28, 2018
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/s/ E. ASHTON POOLE
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E. Ashton Poole
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Chief Executive Officer
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February 28, 2018
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/s/ STEVEN C. LILLY
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Steven C. Lilly
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Chief Financial Officer
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February 28, 2018
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