UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
CURRENT REPORT
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Item 1.01 – Entry into a Material Definitive Agreement
On March 25, 2024, Trinity Capital Inc. (the “Company”) entered into an underwriting agreement (the “Underwriting Agreement”) by and among the Company and Keefe, Bruyette & Woods, Inc., Morgan Stanley & Co. LLC and RBC Capital Markets, LLC, as representatives of the several underwriters named in Schedule 1 thereto, in connection with the issuance and sale of $115,000,000 aggregate principal amount of the Company’s 7.875% Notes due 2029 (the “Notes” and the issuance and sale of the Notes, the “Offering”).
The Notes were issued under the Base Indenture, dated January 16, 2020 (the “Base Indenture”), between the Company and U.S. Bank National Association, as trustee (together with its successor in interest, U.S. Bank Trust Company, National Association, the “Trustee”), as supplemented by the Fifth Supplemental Indenture, dated March 28, 2024 (the “Fifth Supplemental Indenture” and together with the Base Indenture, the “Indenture”).
The Notes bear interest at a rate of 7.875% per year payable quarterly in arrears on March 30, June 30, September 30 and December 30 of each year, commencing on June 30, 2024. The Notes will mature on March 30, 2029 and may be redeemed in whole or in part at any time, or from time to time, at the Company’s option on or after March 30, 2026, at a redemption price equal to 100% of the outstanding principal amount thereof, plus accrued and unpaid interest to, but excluding, the date of redemption.
The Notes are expected to be listed on the Nasdaq Global Select Market (“Nasdaq”) and to trade on Nasdaq within 30 days of the issue date under the trading symbol “TRINZ.”
The Company expects to use the net proceeds from the Offering to pay down a portion of its existing indebtedness outstanding under a credit agreement (the “Credit Agreement”) with KeyBank, National Association (“KeyBank”) and, depending on the remaining amount of net proceeds after such use, to redeem a portion of its outstanding 7.00% Notes due 2025 (“2025 Notes”). The Credit Agreement has a maturity date of October 27, 2026 and grants the Company, through its wholly owned subsidiary TrinCap Funding, LLC, a borrowing capacity of up to $400.0 million, with committed availability of up to $350.0 million. Borrowings under the Credit Agreement bear interest at a rate equal to Adjusted Term Secured Overnight Financing Rate (“SOFR”) plus, currently, 3.25%, subject to the number of eligible loans in the collateral pool. As of March 22, 2024, approximately $265.0 million was outstanding under the Credit Agreement, and approximately $182.5 million in aggregate principal amount of 2025 Notes were outstanding. The Company may re-borrow under the Credit Agreement to make investments in accordance with its investment objective and investment strategy and for general corporate purposes.
The Notes are the direct, unsecured obligations of the Company and rank pari passu, or equal, in right of payment with all of the Company’s other future and outstanding unsecured, unsubordinated indebtedness. The Notes rank effectively subordinated, or junior, to any of our future secured indebtedness or other obligations (including unsecured indebtedness that the Company later secures) to the extent of the value of the assets securing such indebtedness. The Notes rank structurally subordinated, or junior, to all existing and future indebtedness and other obligations (including trade payables) incurred by the Company’s subsidiaries, financing vehicles or similar facilities.
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The Indenture contains certain covenants including covenants requiring the Company to comply with Section 18(a)(1)(A) as modified by Section 61(a) of the Investment Company Act of 1940, as amended (“1940 Act”), or any successor provisions, but giving effect, in either case, to any exemptive relief granted to the Company by the Securities and Exchange Commission (“SEC”); to comply with Section 18(a)(1)(B) as modified by Section 61(a)(2) of the 1940 Act, or any successor provisions, after giving effect, in either case, to any exemptive relief granted to the Company by the SEC and subject to certain other exceptions; and to provide financial information to the holders of the Notes and the Trustee if the Company should no longer be subject to the reporting requirements under the Securities Exchange Act of 1934, as amended. These covenants are subject to important limitations and exceptions that are described in the Indenture.
The Notes were offered and sold in an offering registered under the Securities Act of 1933, as amended, pursuant to the Registration Statement on Form N-2 (File No. 333-275970), the prospectus supplement dated March 25, 2024 and the pricing term sheet filed with the SEC on March 25, 2024. The transaction closed on March 28, 2024. The net proceeds to the Company were approximately $111.38 million, based on the public offering price of 100% of the aggregate principal amount of the Notes, after deducting the underwriting discount of $3.45 million and the estimated offering expenses of approximately $170,000 payable by the Company, subject to the agreement by the underwriters to reimburse us for certain expenses incurred in connection with this offering.
The foregoing descriptions of the Underwriting Agreement, the Base Indenture, the Fifth Supplemental Indenture, and the Notes do not purport to be complete and are qualified in their entirety by reference to the full text of the Underwriting Agreement, the Base Indenture, the Fifth Supplemental Indenture, and the form of global note representing the Notes, respectively, each filed or incorporated by reference as exhibits hereto and incorporated by reference herein.
This Current Report on Form 8-K shall not constitute an offer to sell or a solicitation of an offer to buy any securities, nor shall there be any sale of these securities in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or other jurisdiction.
Item 2.03 – Creation of a Direct Financial Obligation or an Obligation Under an Off-Balance Sheet Arrangement of a Registrant
The information set forth under Item 1.01 of this Form 8-K is incorporated herein by reference.
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Item 9.01 – Financial Statements and Exhibits
(d) Exhibits:
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| Trinity Capital Inc. | |||
| Date: March 28, 2024 | By: | /s/ Kyle Brown | |
| Name: | Kyle Brown | ||
| Title: | Chief Executive Officer, President and Chief Investment Officer | ||
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