UNITED
STATES



SECURITIES
AND EXCHANGE COMMISSION



Washington, D.C. 20549








FORM 10-Q








|☒ | QUARTERLY REPORT
    PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | -------------------------------------------------------------------------------------------



For the
Quarterly Period Ended March 31, 2018



OR



|☐ | TRANSITION REPORT
    PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | --------------------------------------------------------------------------------------------



For the transition period from to



Commission File Number 814-00908



Triton Pacific Investment Corporation,
Inc.



(Exact name of registrant as specified
in its charter)



|Maryland                                                                        |  | 45-2460782                                           
|------------------------------------------------------------------------------- |  | -----------------------------------------------------
|(State or other jurisdiction of
        
        incorporation or organization) |  | (I.R.S. Employer
        
        Identification No.)



6701 Center
Drive West, Suite 1450



Los Angeles,
CA 90045



(Address of principal executive offices)



(310)
943-4990



(Registrant’s telephone number,
including area code)



(Former name, former address and former
fiscal year, if changed since last report)



Indicate
by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90 days. Yes☒
No☐



Indicate
by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive
Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such
shorter period that the registrant was required to submit and post such files). Yes☒
  No☐



Indicate by check mark whether the registrant
is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of
“large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2
of the Exchange Act.



|Large accelerated filer |  | ☐                                                  |  | Accelerated filer         |  | ☐
|----------------------- |  | -------------------------------------------------- |  | ------------------------- |  | -
|                        |  |                                                    | 
|Non-accelerated filer   |  | ☒(Do not check     if a smaller reporting company) |  | Smaller reporting company |  | ☐



Indicate
by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes☐
No☒



As of May 15, 2018, the Registrant had
1,513,839.20 shares of Class A common stock, $0.001 par value, outstanding.




















TABLE OF CONTENTS





|Part I—Financial Information                                                                  | 3 
|--------------------------------------------------------------------------------------------- | --
|                                                                                              |   
|Item 1: Financial Statements                                                                  | 3 
|                                                                                              |   
|Item 2: Management’s Discussion and Analysis of Financial Condition and Results of Operations | 26
|                                                                                              |   
|Item 3: Quantitative and Qualitative Disclosures About Market Risk                            | 45
|                                                                                              |   
|Item 4: Controls and Procedures                                                               | 46
|                                                                                              |   
|Part II—Other Information                                                                     | 46
|                                                                                              |   
|Item 1: Legal Proceedings                                                                     | 46
|                                                                                              |   
|Item 1A: Risk Factors                                                                         | 46
|                                                                                              |   
|Item 2: Unregistered Sales of Equity Securities and Use of Proceeds                           | 48
|                                                                                              |   
|Item 3: Defaults Upon Senior Securities                                                       | 48
|                                                                                              |   
|Item 4: Mine Safety Disclosures                                                               | 48
|                                                                                              |   
|Item 5: Other Information                                                                     | 48
|                                                                                              |   
|Item 6: Exhibits                                                                              | 49
|                                                                                              |   
|SIGNATURES                                                                                    | 50





2







Part I—Financial Information



Item
1: Financial Statements



Triton
Pacific Investment Corporation, Inc.



CONSOLIDATED
StatementS of Financial Position





|                                                                                                                                       |  | March 31,   |            |   |              |  
|-------------------------------------------------------------------------------------------------------------------------------------- |  | ----------- | ---------- | - | ------------ | -
|                                                                                                                                       |  | 2018        |            |   | December 31, |  
|                                                                                                                                       |  | (unaudited) |            |   | 2017         |  
|ASSETS                                                                                                                                 |  |             |            |   |              |  
|                                                                                                                                       |  |             |            |   |              |  
|Affiliate Investments, at fair value (amortized cost - $1,916,389, and $1,916,389, respectively)                                       |  | $           | 507,648    |   |              | $
|Non-affiliate Investments, at fair value (amortized cost - $13,414,797 and $11,633,659, respectively)                                  |  |             | 13,368,551 |   |              |  
|Cash                                                                                                                                   |  |             | 3,612,132  |   |              |  
|Principal and interest receivable                                                                                                      |  |             | 28,652     |   |              |  
|Prepaid expenses                                                                                                                       |  |             | 28,328     |   |              |  
|Reimbursement due from Adviser (see Note 4)                                                                                            |  |             | 184,753    |   |              |  
|Deferred offering costs                                                                                                                |  |             | 142,331    |   |              |  
|                                                                                                                                       |  |             |            |   |              |  
|TOTAL ASSETS                                                                                                                           |  | $           | 17,872,395 |   |              | $
|                                                                                                                                       |  |             |            |   |              |  
|                                                                                                                                       |  |             |            |   |              |  
|LIABILITIES AND NET ASSETS                                                                                                             |  |             |            |   |              |  
|                                                                                                                                       |  |             |            |   |              |  
|LIABILITIES                                                                                                                            |  |             |            |   |              |  
|Payable for investments purchased                                                                                                      |  | $           | —          |   |              | $
|Accounts payable and accrued liabilities                                                                                               |  |             | 245,240    |   |              |  
|Due to related parties (see Note 4)                                                                                                    |  |             | 35,139     |   |              |  
|TOTAL LIABILITIES                                                                                                                      |  |             | 280,379    |   |              |  
|                                                                                                                                       |  |             |            |   |              |  
|COMMITMENTS AND CONTINGENCIES (see Note 9)                                                                                             |  |             |            |   |              |  
|                                                                                                                                       |  |             |            |   |              |  
|NET ASSETS                                                                                                                             |  |             |            |   |              |  
|Common stock, $0.001 par value, 75,000,000 shares authorized, 1,486,166.98 and 1,417,233.32 shares issued and outstanding respectively |  |             | 1,486      |   |              |  
|Capital in excess of par value                                                                                                         |  |             | 19,868,852 |   |              |  
|Accumulated undistributed net realized gains                                                                                           |  |             | 26,803     |   |              |  
|Accumulated overdistributed net investment income                                                                                      |  |             | (850,140   | ) |              |  
|Accumulated unrealized depreciation on investments                                                                                     |  |             | (1,454,985 | ) |              |  
|TOTAL NET ASSETS                                                                                                                       |  |             | 17,592,016 |   |              |  
|                                                                                                                                       |  |             |            |   |              |  
|TOTAL LIABILITIES AND NET ASSETS                                                                                                       |  | $           | 17,872,395 |   |              | $
|                                                                                                                                       |  |             |            |   |              |  
|Net asset value per share of common stock at period end                                                                                |  | $           | 11.84      |   |              | $





The accompanying notes are an integral
part of these statements.





3







Triton
Pacific Investment Corporation, Inc.



CONSOLIDATED
Statements of Operations



THREE MONTHS ENDED MARCH 31, 2018 AND
2017



(Unaudited)





|                                                                                  |  | Three months ended |          
|--------------------------------------------------------------------------------- |  | ------------------ | ---------
|                                                                                  |  | March 31,          |          
|                                                                                  |  | 2018               |          
|INVESTMENT INCOME                                                                 |  |                    |          
|Interest from affiliate investments                                               |  | $                  | —        
|Interest from non-control/ non-affiliate investments                              |  |                    | 251,808  
|Fee income from non-control/ non-affiliate investments                            |  |                    | 3,866    
|                                                                                  |  |                    |          
|Total investment income                                                           |  |                    | 255,674  
|                                                                                  |  |                    |          
|OPERATING EXPENSES                                                                |  |                    |          
|Management fees                                                                   |  |                    | 88,296   
|Capital gains incentive fees (see Notes 2 and 4)                                  |  |                    | —        
|Administrator expense                                                             |  |                    | 74,395   
|Professional fees                                                                 |  |                    | 62,876   
|Insurance expense                                                                 |  |                    | 19,763   
|Offering expense                                                                  |  |                    | 31,215   
|Other operating expenses                                                          |  |                    | 6,828    
|                                                                                  |  |                    |          
|Total operating expenses                                                          |  |                    | 283,373  
|                                                                                  |  |                    |          
|Expense reimbursement from Sponsor                                                |  |                    | —        
|                                                                                  |  |                    |          
|Net operating expenses                                                            |  |                    | 283,373  
|                                                                                  |  |                    |          
|Net investment income/ (loss)                                                     |  |                    | (27,699  
|                                                                                  |  |                    |          
|REALIZED AND UNREALIZED GAIN/(LOSS)                                               |  |                    |          
|Net realized gain on non-affiliated investments                                   |  |                    | 22,650   
|Net increase (decrease) in unrealized appreciation on affiliate investments       |  |                    | (30,255  
|Net increase in unrealized appreciation on non-control/ non-affiliate investments |  |                    | 89,780   
|                                                                                  |  |                    |          
|Total net realized and unrealized gain on investments                             |  |                    | 82,175   
|                                                                                  |  |                    |          
|NET INCREASE IN NET ASSETS  FROM OPERATIONS                                       |  | $                  | 54,476   
|                                                                                  |  |                    |          
|PER SHARE INFORMATION - Basic and Diluted                                         |  |                    |          
|Net increase in net assets from operations per share                              |  | $                  | 0.04     
|                                                                                  |  |                    |          
|Weighted average common shares outstanding - basic and diluted                    |  |                    | 1,445,936





The accompanying notes are an integral
part of these statements.



4







Triton
Pacific Investment Corporation, Inc.



CONSOLIDATED
StatementS of CHANGES IN NET ASSETS



THREE
MONTHS ended MARCH 31, 2018 AND 2017



(Unaudited)





|                                                                    |  | Three months ended |           
|------------------------------------------------------------------- |  | ------------------ | ----------
|                                                                    |  | March 31,          |           
|                                                                    |  | 2018               |           
|Operations                                                          |  |                    |           
|Net investment income/ (loss)                                       |  | $                  | (27,699   
|Net realized gain on investments                                    |  |                    | 22,650    
|Net increase in unrealized appreciation on investments              |  |                    | 59,525    
|Net increase in net assets resulting from operations                |  |                    | 54,476    
|Stockholder distributions (see Note 5)                              |  |                    |           
|Distributions from net investment income                            |  |                    | (85,819   
|Distributions from net realized gain on investments                 |  |                    | (60,908   
|Net decrease in net assets resulting from stockholder distributions |  |                    | (146,727  
|Capital share transactions                                          |  |                    |           
|Issuance of common stock (see Note 3)                               |  |                    | 829,856   
|Reinvestment of stockholder distributions (see Note 3)              |  |                    | 82,533    
|Repurchase of shares of common stock                                |  |                    | (77,359   
|Net increase in net assets from capital share transactions          |  |                    | 835,030   
|                                                                    |  |                    |           
|Total increase in net assets                                        |  |                    | 742,779   
|Net assets at beginning of period                                   |  |                    | 16,849,237
|Net assets at end of period                                         |  | $                  | 17,592,016
|Accumulated overdistributed net investment income                   |  | $                  | (850,140  
|Accumulated undistributed net realized gains                        |  | $                  | 26,803    





The accompanying notes are an integral
part of these statements.



5







Triton
Pacific Investment Corporation, Inc.



CONSOLIDATED
Statements of CASH FLOWS



THREE MONTHS ENDED MARCH 31, 2018 AND
2017



(Unaudited)





|                                                                                                                       |  | Three months ended |           
|---------------------------------------------------------------------------------------------------------------------- |  | ------------------ | ----------
|                                                                                                                       |  | March 31,          |           
|                                                                                                                       |  | 2018               |           
|CASH FLOWS FROM OPERATING ACTIVITIES                                                                                   |  |                    |           
|Net increase in net assets resulting from operations                                                                   |  | $                  | 54,476    
|Adjustments to reconcile net increase in net assets resulting from operations to net cash used by operating activities |  |                    |           
|Purchases of investments                                                                                               |  |                    | (2,452,500
|Proceeds from sales and repayments of investments                                                                      |  |                    | 701,586   
|Net realized gain from investments                                                                                     |  |                    | (22,650   
|Net change in unrealized appreciation (depreciation) on investments                                                    |  |                    | (59,525   
|Accretion of discount                                                                                                  |  |                    | (7,572    
|Net increase in paid-in-kind interest                                                                                  |  |                    | —         
|Amortization of deferred offering costs                                                                                |  |                    | 31,215    
|Change in assets and liabilities                                                                                       |  |                    |           
|Principal and interest receivable                                                                                      |  |                    | 12,375    
|Prepaid expenses                                                                                                       |  |                    | 19,763    
|Reimbursement due from Adviser                                                                                         |  |                    | 72,875    
|Payable for investments purchased                                                                                      |  |                    | (990,000  
|Accounts payable and accrued liabilities                                                                               |  |                    | (4,670    
|Due to related parties                                                                                                 |  |                    | 9,427     
|NET CASH USED BY OPERATING ACTIVITIES                                                                                  |  |                    | (2,635,200
|                                                                                                                       |  |                    |           
|CASH FLOWS FROM FINANCING ACTIVITIES                                                                                   |  |                    |           
|Issuance of common stock                                                                                               |  |                    | 829,856   
|Payments on repurchases of shares of common stock                                                                      |  |                    | (77,359   
|Stockholder distributions                                                                                              |  |                    | (64,194   
|Increases in distributions payable                                                                                     |  |                    | —         
|Offering costs                                                                                                         |  |                    | (89,476   
|NET CASH PROVIDED BY FINANCING ACTIVITIES                                                                              |  |                    | 598,827   
|                                                                                                                       |  |                    |           
|NET INCREASE (DECREASE) IN CASH                                                                                        |  |                    | (2,036,373
|                                                                                                                       |  |                    |           
|CASH - BEGINNING OF PERIOD                                                                                             |  | $                  | 5,648,505 
|                                                                                                                       |  |                    |           
|CASH  - END OF PERIOD                                                                                                  |  | $                  | 3,612,132 
|                                                                                                                       |  |                    |           
|Supplemental schedule of non-cash investing activities                                                                 |  |                    |           
|Reinvestment of stockholder distributions                                                                              |  | $                  | 82,533    





The accompanying notes are an integral
part of these statements.





6







TRITON PACIFIC INVESTMENT CORPORATION,
INC.



CONSOLIDATED SCHEDULE OF INVESTMENTS



AS OF MARCH 31, 2018



(UNAUDITED)





|Portfolio
    Company                      |  | Footnotes |  | Industry                          |  | Rate
    (b)      |  | Floor |  | Maturity   |  |   | Principal
    Amount/ Number of Shares |  |   | Amortized
    Cost(f) |  |   | Fair
    
Value(c) | 
|------------------------------------------ |  | --------- |  | --------------------------------- |  | ----------------- |  | ----- |  | ---------- |  | - | -------------------------------------- |  | - | --------------------- |  | - | ------------------ | 
|Senior Secured Loans—First Lien—50.06%     |  |           |  |                                   |  |                   |  |       |  |            |  |   |                                        |  |   |                       |  |   |                    | 
|LSF9 Atlantis Holdings, LLC                |  |           |  | Telecommunications                |  | L+6.00% (7.36%)   |  | 1.36% |  | 5/1/2023   |  | $ | 490,625                                |  | $ | 486,317               |  | $ | 489,595            | 
|California Pizza Kitchen, Inc.             |  |           |  | Beverage, Food & Tobacco          |  | L+6.00% (7.57%)   |  | 1.57% |  | 8/19/2022  |  |   | 344,750                                |  |   | 342,204               |  |   | 338,545            | 
|CareCentrix, Inc.                          |  |           |  | Healthcare & Pharmaceuticals      |  | L+5.00% (6.69%)   |  | 1.69% |  | 7/8/2021   |  |   | 195,000                                |  |   | 191,978               |  |   | 196,092            | 
|CareerBuilder                              |  |           |  | Business Services                 |  | L+6.75% (8.44%)   |  | 1.69% |  | 7/27/2023  |  |   | 487,500                                |  |   | 474,137               |  |   | 486,915            | 
|Coronado Curragh LLC - Term Loan B         |  |           |  | Metals & Mining                   |  | L+6.50% (8.80%)   |  | 2.30% |  | 3/29/2025  |  |   | 392,857                                |  |   | 381,117               |  |   | 388,929            | 
|Coronado Curragh LLC - Term Loan C         |  |           |  | Metals & Mining                   |  | L+6.50% (8.80%)   |  | 2.30% |  | 3/21/2025  |  |   | 107,143                                |  |   | 103,968               |  |   | 106,071            | 
|CRCI Holdings, Inc.                        |  |           |  | Business Services                 |  | L+5.50% (7.19%)   |  | 1.69% |  | 8/31/2023  |  |   | 324,564                                |  |   | 321,865               |  |   | 326,316            | 
|Deluxe Entertainment Services Group, Inc.  |  |           |  | Media: Diversified and Production |  | L+5.50% (6.88%)   |  | 1.38% |  | 2/28/2020  |  |   | 338,412                                |  |   | 332,377               |  |   | 335,299            | 
|Flavors Holdings, Inc. Tranche B           |  |           |  | Beverage, Food & Tobacco          |  | L+5.75% (7.44%)   |  | 1.69% |  | 4/3/2020   |  |   | 103,125                                |  |   | 101,335               |  |   | 93,328             | 
|GK Holdings, Inc.                          |  |           |  | Business Services                 |  | L+6.00% (7.69%)   |  | 1.69% |  | 1/20/2021  |  |   | 120,938                                |  |   | 120,510               |  |   | 108,348            | 
|GoWireless Holdings, Inc.                  |  |           |  | Consumer Services                 |  | L+6.50% (8.16%)   |  | 1.66% |  | 12/20/2024 |  |   | 493,750                                |  |   | 488,905               |  |   | 493,158            | 
|IG Investments Holdings, LLC               |  |           |  | Business Services                 |  | L+3.50% (5.19%)   |  | 1.69% |  | 10/29/2021 |  |   | 344,675                                |  |   | 343,456               |  |   | 349,432            | 
|InfoGroup Inc.                             |  |           |  | Business Services                 |  | L+5.00% (6.69%)   |  | 1.69% |  | 3/28/2023  |  |   | 495,000                                |  |   | 490,826               |  |   | 492,822            | 
|Jackson Hewitt, Inc.                       |  |           |  | Business Services                 |  | L+7.00% (8.38%)   |  | 1.38% |  | 7/30/2020  |  |   | 186,138                                |  |   | 184,061               |  |   | 185,673            | 
|McAfee LLC                                 |  |           |  | Business Services                 |  | L+4.50% (6.07%)   |  | 1.57% |  | 9/27/2024  |  |   | 248,750                                |  |   | 246,424               |  |   | 251,636            | 
|Moran Foods, LLC                           |  |           |  | Beverage, Food & Tobacco          |  | L+6.00% (7.57%)   |  | 1.57% |  | 12/5/2023  |  |   | 345,625                                |  |   | 337,118               |  |   | 302,215            | 
|Pre-Paid Legal Services, Inc               |  |           |  | Consumer Services                 |  | L+5.25% (6.82%)   |  | 1.57% |  | 7/1/2019   |  |   | 290,638                                |  |   | 290,187               |  |   | 292,091            | 
|Prospect Medical Holdings, Inc.            |  |           |  | Healthcare & Pharmaceuticals      |  | L+5.50% (7.00%)   |  | 1.50% |  | 2/22/2024  |  |   | 500,000                                |  |   | 490,192               |  |   | 501,250            | 
|Quidditch Acquisition, Inc.                |  |           |  | Beverage, Food & Tobacco          |  | L+7.00% (8.84%)   |  | 1.84% |  | 3/14/2025  |  |   | 500,000                                |  |   | 490,020               |  |   | 503,750            | 
|Raley’s                                    |  |           |  | Beverage, Food & Tobacco          |  | L+5.25% (6.82%)   |  | 1.57% |  | 5/18/2022  |  |   | 283,503                                |  |   | 283,503               |  |   | 286,706            | 
|Sahara Parent Inc                          |  |           |  | Business Services                 |  | L+5.00% (6.69%)   |  | 1.69% |  | 8/16/2024  |  |   | 348,250                                |  |   | 345,031               |  |   | 349,782            | 
|SITEL Worldwide Corporation                |  |           |  | Business Services                 |  | L+5.50% (6.88%)   |  | 1.38% |  | 9/20/2021  |  |   | 195,000                                |  |   | 194,891               |  |   | 195,780            | 
|Strike, LLC                                |  |           |  | Energy: Oil & Gas                 |  | L+8.00% (9.50%)   |  | 1.50% |  | 11/30/2022 |  |   | 328,125                                |  |   | 319,998               |  |   | 333,047            | 
|Travel Leaders Group, LLC                  |  |           |  | Hotel, Gaming & Leisure           |  | L+4.50% (5.92%)   |  | 1.42% |  | 1/25/2024  |  |   | 346,506                                |  |   | 345,055               |  |   | 351,565            | 
|TruGreen Limited Partnership               |  |           |  | Consumer Services                 |  | L+4.00% (5.54%)   |  | 1.54% |  | 4/13/2023  |  |   | 344,768                                |  |   | 340,952               |  |   | 349,077            | 
|Verdesian Life Sciences LLC                |  |           |  | Wholesale Trade-Nondurable Goods  |  | L+5.00% (6.38%)   |  | 1.38% |  | 7/1/2020   |  |   | 205,740                                |  |   | 204,797               |  |   | 198,539            | 
|Wirepath LLC                               |  |           |  | Consumer Services                 |  | L+5.25% (6.87%)   |  | 1.62% |  | 8/5/2024   |  |   | 497,503                                |  |   | 495,183               |  |   | 499,990            | 
|Total Senior Secured Loans—First Lien      |  |           |  |                                   |  |                   |  |       |  |            |  | $ | 8,858,885                              |  | $ | 8,746,407             |  | $ | 8,805,951          | 
|                                           |  |           |  |                                   |  |                   |  |       |  |            |  |   |                                        |  |   |                       |  |   |                    | 
|Senior Secured Loans—Second Lien—25.94%    |  |           |  |                                   |  |                   |  |       |  |            |  |   |                                        |  |   |                       |  |   |                    | 
|DG Investment Intermediate Holdings 2 Inc. |  |           |  | Business Services                 |  | L+6.75% (8.41%)   |  | 1.66% |  | 2/1/2026   |  |   | 500,000                                |  |   | 497,549               |  |   | 507,500            | 
|Flavors Holdings, Inc.                     |  |           |  | Beverage, Food & Tobacco          |  | L+10.00% (11.69%) |  | 1.69% |  | 10/7/2021  |  |   | 125,000                                |  |   | 122,522               |  |   | 101,250            | 
|FullBeauty Brands Holding                  |  |           |  | High Tech Industries              |  | L+9.00% (10.57%)  |  | 1.57% |  | 10/13/2023 |  |   | 250,000                                |  |   | 219,059               |  |   | 71,450             | 
|GK Holdings, Inc.                          |  |           |  | Business Services                 |  | L+10.25% (11.94%) |  | 1.69% |  | 1/21/2022  |  |   | 125,000                                |  |   | 123,649               |  |   | 96,875             | 
|Inmar                                      |  |           |  | Business Services                 |  | L+8.00% (9.42%)   |  | 1.42% |  | 5/1/2025   |  |   | 500,000                                |  |   | 493,335               |  |   | 502,800            | 
|McAfee LLC                                 |  |           |  | Business Services                 |  | L+8.50% (10.07%)  |  | 1.57% |  | 9/26/2025  |  |   | 500,000                                |  |   | 497,102               |  |   | 507,750            | 
|Neustar, Inc.                              |  |           |  | High Tech Industries              |  | L+8.00% (9.40%)   |  | 1.40% |  | 2/28/2025  |  |   | 750,000                                |  |   | 739,679               |  |   | 757,725            | 
|NPC International, Inc.                    |  |           |  | Beverage, Food & Tobacco          |  | L+7.50 (9.05%)    |  | 1.55% |  | 3/28/2025  |  |   | 500,000                                |  |   | 498,370               |  |   | 512,500            | 
|Oxbow Carbon LLC                           |  |           |  | Metals & Mining                   |  | L+6.00 (10.50%)   |  | 4.50% |  | 1/4/2024   |  |   | 500,000                                |  |   | 495,212               |  |   | 508,750            | 
|Patriot Container Corp.                    |  |           |  | Environmental                     |  | L+7.75% (9.57%)   |  | 1.82% |  | 3/16/2026  |  |   | 500,000                                |  |   | 490,052               |  |   | 488,750            | 
|Rocket Software, Inc.                      |  |           |  | Business Services                 |  | L+9.50% (11.19%)  |  | 1.69% |  | 10/14/2024 |  |   | 500,000                                |  |   | 491,861               |  |   | 507,250            | 
|Total Senior Secured Loans—Second Lien     |  |           |  |                                   |  |                   |  |       |  |            |  | $ | 4,750,000                              |  | $ | 4,668,390             |  | $ | 4,562,600          | 



The accompanying notes are an integral
part of these statements.





7







TRITON PACIFIC INVESTMENT CORPORATION,
INC.



CONSOLIDATED SCHEDULE OF INVESTMENTS



AS OF MARCH 31, 2018 (CONTINUED)



(UNAUDITED)



|                                                     |         |             |                   |                              |       |              |  |       |           |          |  |         |                                        |   |           |                       |  |   |                    | 
|---------------------------------------------------- | ------- | ----------- | ----------------- | ---------------------------- | ----- | ------------ |  | ----- | --------- | -------- |  | ------- | -------------------------------------- | - | --------- | --------------------- |  | - | ------------------ | 
|Portfolio
    Company                                |         | Footnotes   |                   | Industry                     |       | Rate
    (b) |  | Floor |           | Maturity |  |         | Principal
    Amount/ Number of Shares |   |           | Amortized
    Cost(f) |  |   | Fair
    
Value(c) | 
|Subordinated Convertible Debt—0.00%                  |         |             |                   |                              |       |              |  |       |           |          |  |         |                                        |   |           |                       |  |   |                    | 
|Javlin Capital LLC Subordinated Convertible
    Note | (a) (e) |             | Specialty Finance |                              | 6.00% |              |  |       | 3/31/2020 |          |  | 666,389 |                                        |   | 666,389   |                       |  | — |                   
|Total Subordinated Convertible Debt                  |         |             |                   |                              |       |              |  |       |           |          |  | $       | 666,389                                |   | $         | 666,389               |  | $ | —                  | 
|                                                     |         |             |                   |                              |       |              |  |       |           |          |  |         |                                        |   |           |                       |  |   |                    | 
|Equity/Other—2.89%                                   |         |             |                   |                              |       |              |  |       |           |          |  |         |                                        |   |           |                       |  |   |                    | 
|ACON IWP Investors I, L.L.C.                         |         | (a)         |                   | Healthcare & Pharmaceuticals |       |              |  |       |           |          |  |         | 500,000                                |   |           | 500,000               |  |   | 507,648            | 
|Javlin Capital LLC Class C-2 Preferred Units         |         | (a) (d) (e) |                   | Specialty Finance            |       |              |  |       |           |          |  |         | 214,286                                |   |           | 750,000               |  |   | —                  | 
|Total Equity/Other                                   |         |             |                   |                              |       |              |  |       |           |          |  |         | 714,286                                |   | $         | 1,250,000             |  | $ | 507,648            | 
|                                                     |         |             |                   |                              |       |              |  |       |           |          |  |         |                                        |   |           |                       |  |   |                    | 
|TOTAL INVESTMENTS—78.89%                             |         |             |                   |                              |       |              |  |       |           |          |  |         |                                        |   | $         | 15,331,186            |  | $ | 13,876,199         | 
|OTHER ASSETS IN EXCESS OF LIABILITIES—29.11%         |         |             |                   |                              |       |              |  |       |           |          |  |         |                                        | $ | 3,715,817 |                      
|NET ASSETS - 100.0%                                  |         |             |                   |                              |       |              |  |       |           |          |  |         |                                        |   |           |                       |  | $ | 17,592,016         | 














| | (a) | Affiliated investment as defined by the 1940 Act, whereby
the Company owns between 5% and 25% of the portfolio company’s outstanding voting securities and the investments are not
classified as controlled investments. Affiliated funds that are managed by an affiliate of Triton Pacific Adviser, LLC also hold
investments in this security. The aggregate fair value of non-controlled, affiliated investments at March 31, 2018 represented
2.89% of the Company’s net assets. Fair value as of December 31, 2017 along with transactions during the three months ended
March 31, 2018 in affiliated investments were as follows):
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





|                                           |  |                                     |         |  |                             |   |   | Three months
    ended March 31, 2018 |  |   |                                  |  |  |                              |        
|------------------------------------------ |  | ----------------------------------- | ------- |  | --------------------------- | - | - | ------------------------------------- |  | - | -------------------------------- |  |  | ---------------------------- | -------
|Non-controlled,
    Affiliated Investments |  | Fair
    Value at December 31, 2017 |         |  | Gross
    Additions (Cost)* |   |   | Gross
    Reductions (Cost)**         |  |   | Fair
    Value at March 31, 2018 |  |  | Net
    Realized Gain (Loss) |        
|ACON IWP Investors I, L.L.C.               |  | $                                   | 537,903 |  |                             | $ | — |                                       |  | $ | —                                |  |  | $                            | 507,648
|Javlin Capital, LLC, Convertible Note      |  |                                     | —       |  |                             |   | — |                                       |  |   | —                                |  |  |                              | —      
|Javlin Capital, LLC, C-2 Preferred Units   |  |                                     | —       |  |                             |   | — |                                       |  |   | —                                |  |  |                              | —      
|Total                                      |  | $                                   | 537,903 |  |                             | $ | — |                                       |  | $ | —                                |  |  | $                            | 507,648





*Gross additions include increases in the cost basis of investments
resulting from new portfolio investments, PIK interest, the amortization of unearned income, the exchange of one or more existing
securities for one or more new securities and the movement of an existing portfolio company into this category from a different
category.



**Gross reductions include decreases in the cost basis of investments
resulting from principal collections related to investment repayments or sales, the exchange of one or more existing securities
for one or more new securities and the movement of an existing portfolio company out of this category into a different category.



| | (b) | Certain variable rate securities in the Company’s portfolio
bear interest at a rate determined by a publicly disclosed base rate spread. As of March 31, 2018, the three-month London Interbank
Offered Rate, or LIBOR, was 2.31175%.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (c) | Fair value and market value are determined by the Company’s
board of directors (see Note 7.)
| | --- | --------------------------------------------------------------------------------------------



| | (d) | Security held within TPJ Holdings, Inc., a wholly-owned
subsidiary of the Company. See Note 2 for a dicussion on the basis of consolidation.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------



| | (e) | The investment is not a qualifying asset under the Investment
Company Act of 1940, as amended. A business development company may not acquire any asset other than a qualifying asset, unless,
at the time the acquisition is made, qualifying assets represent at least 70% of the business development company’s total
assets. As of March 31, 2018, 100% of the Company’s total assets represented qualifying assets based on fair market value.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (f) | See Note 5 for a discussion of the tax cost of the portfolio.
| | --- | -------------------------------------------------------------





The accompanying notes are an integral
part of these statements.





8









TRITON PACIFIC INVESTMENT CORPORATION,
INC.



CONSOLIDATED SCHEDULE OF INVESTMENTS



AS OF DECEMBER 31, 2017



|                                            |  |           |  |                                   |  |                     |  |                     |  |            |  |   |                                        |  |   |                       |  |   |                    | 
|------------------------------------------- |  | --------- |  | --------------------------------- |  | ------------------- |  | ------------------- |  | ---------- |  | - | -------------------------------------- |  | - | --------------------- |  | - | ------------------ | 
|Portfolio
    Company                       |  | Footnotes |  | Industry                          |  | Rate
    (b)        |  | Base
    Rate Floor |  | Maturity   |  |   | Principal
    Amount/ Number of Shares |  |   | Amortized
    Cost(f) |  |   | Fair
    
Value(c) | 
|Senior Secured Loans—First Lien—45.65%      |  |           |  |                                   |  |                     |  |                     |  |            |  |   |                                        |  |   |                       |  |   |                    | 
|LSF9Atlantis Holdings, LLC                  |  |           |  | Telecommunications                |  | L+6.00% (7.36%)     |  | 1.4%                |  | 5/1/2023   |  | $ | 493,750                                |  | $ | 489,235               |  | $ | 496,322            | 
|California Pizza Kitchen, Inc.              |  |           |  | Beverage, Food & Tobacco          |  | L+6.00% (7.57%)     |  | 1.6%                |  | 8/19/2022  |  |   | 345,625                                |  |   | 342,933               |  |   | 339,577            | 
|CareCentrix, Inc.                           |  |           |  | Healthcare & Pharmaceuticals      |  | L+5.00% (6.69%)     |  | 1.7%                |  | 7/8/2021   |  |   | 195,500                                |  |   | 192,300               |  |   | 196,966            | 
|CareerBuilder                               |  |           |  | Business Services                 |  | L+6.75% (8.44%)     |  | 1.7%                |  | 7/27/2023  |  |   | 493,750                                |  |   | 479,771               |  |   | 481,406            | 
|Coronado Group LLC                          |  |           |  | Metals & Mining                   |  | L+7.00% (8.33%)     |  | 1.3%                |  | 6/6/2023   |  |   | 386,565                                |  |   | 372,943               |  |   | 390,431            | 
|CRCI Holdings,  Inc.                        |  |           |  | Business Services                 |  | L+5.50% (7.19%)     |  | 1.7%                |  | 8/31/2023  |  |   | 324,563                                |  |   | 321,740               |  |   | 325,781            | 
|Deluxe Entertainment Services Group. Inc.   |  |           |  | Media: Diversified and Production |  | L+5.50% (6.88%)     |  | 1.4%                |  | 2/28/2020  |  |   | 340,762                                |  |   | 333,958               |  |   | 334,586            | 
|Flavors Holdings. Inc. Tranche B            |  |           |  | Beverage, Food & Tobacco          |  | L+5.75% (7.44%)     |  | 1.7%                |  | 4/3/2020   |  |   | 104,687                                |  |   | 102,670               |  |   | 97,098             | 
|GK Holdings, Inc.                           |  |           |  | Business Services                 |  | L+6.00% (7.69%)     |  | 1.7%                |  | 1/20/2021  |  |   | 121,250                                |  |   | 120,778               |  |   | 97,364             | 
|GoWireless Holdings,  Inc.                  |  |           |  | Consumer Services                 |  | L+6.50% (8.16%)     |  | 1.7%                |  | 12/20/2024 |  |   | 500,000                                |  |   | 495,000               |  |   | 496,250            | 
|IG Investments Holdings, LLC                |  |           |  | Business Services                 |  | L+3.50% (5.19%)     |  | 1.7%                |  | 10/29/2021 |  |   | 345,543                                |  |   | 344,239               |  |   | 349,431            | 
|InfoGroup Inc.                              |  |           |  | Business Services                 |  | L+5.00% (6.69%)     |  | 1.7%                |  | 3/28/2023  |  |   | 496,250                                |  |   | 491,871               |  |   | 493,769            | 
|Jackson Hewitt, Inc.                        |  |           |  | Business Services                 |  | L+7.00% (8.38%)     |  | 1.4%                |  | 7/30/2020  |  |   | 186,139                                |  |   | 183,882               |  |   | 184,509            | 
|McAfee LLC                                  |  |           |  | Business Services                 |  | L+4.50% (6.07%)     |  | 1.6%                |  | 9/27/2024  |  |   | 249,375                                |  |   | 246,960               |  |   | 248,930            | 
|Moran Foods, LLC                            |  |           |  | Beverage, Food & Tobacco          |  | L+6.00%
    (7.57%) |  | 1.6%                |  | 12/5/2023  |  |   | 346,500                                |  |   | 337,622               |  |   | 278,718            | 
|Pre-Paid Legal Services, Inc                |  |           |  | Consumer Services                 |  | L+5.25% (6.82%)     |  | 1.6%                |  | 7/l/2019   |  |   | 317,021                                |  |   | 316.483               |  |   | 318,275            | 
|Raley’s                                     |  |           |  | Beverage, Food & Tobacco          |  | L+5.25% (6.82%)     |  | 1.6%                |  | 5/18/2022  |  |   | 285,967                                |  |   | 285,967               |  |   | 289,184            | 
|Sahara Parent Inc                           |  |           |  | Business Services                 |  | L+5.00% (6.69%)     |  | 1.7%                |  | 8/16/2024  |  |   | 349,125                                |  |   | 345,783               |  |   | 341,598            | 
|SITEL Worldwide Corporation                 |  |           |  | Business Services                 |  | L+5.50% (6.88%)     |  | 1.4%                |  | 9/20/2021  |  |   | 195,500                                |  |   | 195,212               |  |   | 196,314            | 
|Strike, LLC                                 |  |           |  | Energy Oil & Gas                  |  | L+8.00% (9.50%)     |  | 1.5%                |  | 11/30/2022 |  |   | 332,500                                |  |   | 323,942               |  |   | 337,488            | 
|Travel Leaders Group, LLC                   |  |           |  | Hotel, Gaming & Leisure           |  | L+4.50% (5.92%)     |  | 1.4%                |  | 1/25/2024  |  |   | 347,379                                |  |   | 345,866               |  |   | 352,809            | 
|TruGreen Limited Partnership                |  |           |  | Consumer Services                 |  | L+4.00% (5.54%)     |  | 1.5%                |  | 4/13/2023  |  |   | 345,634                                |  |   | 341,640               |  |   | 351,036            | 
|Verdesian Life Sciences LLC                 |  |           |  | Wholesale Trade-Nondurable Goods  |  | L+5.00% (6.38%)     |  | 1.4%                |  | 7/1/2020   |  |   | 208,335                                |  |   | 207,283               |  |   | 187,502            | 
|Wirepath LLC                                |  |           |  | Consumer Services                 |  | L+5.25% (6.87%)     |  | 1.6%                |  | 8/5/2024   |  |   | 498,750                                |  |   | 496.340               |  |   | 505,608            | 
|Total Senior Secured Loans—First
    Lien   |  |           |  |                                   |  |                     |  |                     |  |            |  | $ | 7,810,470                              |  | $ | 7,714,423             |  | $ | 7,690,952          | 
|                                            |  |           |  |                                   |  |                     |  |                     |  |            |  |   |                                        |  |   |                       |  |   |                    | 
|Senior Secured Loans—Second
    Lien—22.59% |  |           |  |                                   |  |                     |  |                     |  |            |  |   |                                        |  |   |                       |  |   |                    | 
|Flavors Holdings,  Inc.                     |  |           |  | Beverage, Food & Tobacco          |  | L+10.00% (11.69%)   |  | 1.7%                |  | 10/7/2021  |  |   | 125,000                                |  |   | 122,343               |  |   | 101,250            | 
|FullBeauty Brands Holding                   |  |           |  | High Tech Industries              |  | L+9.00% (10.57%)    |  | 1.6%                |  | 10/13/2023 |  |   | 250,000                                |  |   | 218,903               |  |   | 73,334             | 
|GK Holdings, Inc.                           |  |           |  | Business Services                 |  | L+10.25% (11.94%)   |  | 1.7%                |  | 1/21/2022  |  |   | 125,000                                |  |   | 123,559               |  |   | 93,125             | 
|Inmar                                       |  |           |  | Business Services                 |  | L+8.00% (9.42%)     |  | 1.4%                |  | 5/1/2025   |  |   | 500,000                                |  |   | 493,103               |  |   | 502,813            | 
|McAfee LLC                                  |  |           |  | Business Services                 |  | L+8.50% (10.07%)    |  | 1.6%                |  | 9/26/2025  |  |   | 500,000                                |  |   | 496,986               |  |   | 502,504            | 
|Neustar, Inc.                               |  |           |  | High Tech Industries              |  | L+8.00% (9.40%)     |  | 1.4%                |  | 2/28/2025  |  |   | 750,000                                |  |   | 739,275               |  |   | 759,844            | 
|NPC International,  Inc.                    |  |           |  | Beverage, Food & Tobacco          |  | L+7.50 (9.05%)      |  | 1.6%                |  | 3/28/2025  |  |   | 500,000                                |  |   | 498,135               |  |   | 512,500            | 
|Oxbow Carbon LLC                            |  |           |  | Metals & Mining                   |  | L+7.00 (8.24%)      |  | 1.2%                |  | 1/19/2020  |  |   | 250,000                                |  |   | 240,350               |  |   | 250,938            | 
|Oxbow Carbon LLC                            |  |           |  | Metals & Mining                   |  | L+6.00 (10.50%)     |  | 4.5%                |  | 1/4/2024   |  |   | 500,000                                |  |   | 495,034               |  |   | 502,500            | 
|Rocket Software, Inc.                       |  |           |  | Business Services                 |  | L+9.50% (11.19%)    |  | 1.7%                |  | 10/14/2024 |  |   | 500,000                                |  |   | 491,548               |  |   | 507,875            | 
|Total Senior Secured Loans—Second
    Lien  |  |           |  |                                   |  |                     |  |                     |  |            |  | $ | 4,000,000                              |  | $ | 3,919,236             |  | $ | 3,806,683          | 







The accompanying notes are an integral
part of these statements.





9







TRITON PACIFIC INVESTMENT CORPORATION,
INC.



CONSOLIDATED SCHEDULE OF INVESTMENTS



AS OF DECEMBER 31, 2017
(CONTINUED)





|Portfolio
    Company                            |  | Footnotes |  | Industry                     |  | Rate
    (b) |  | Base
    Rate Floor |  | Maturity  |  |   | Principal
    Amount/ Number of Shares |   |           | Amortized
    Cost(f) |  |   | Fair
    
Value(c) | 
|------------------------------------------------ |  | --------- |  | ---------------------------- |  | ------------ |  | ------------------- |  | --------- |  | - | -------------------------------------- | - | --------- | --------------------- |  | - | ------------------ | 
|Subordinated Convertible Debt—0.00%              |  |           |  |                              |  |              |  |                     |  |           |  |   |                                        |   |           |                       |  |   |                    | 
|Javlin Capital LLC Subordinated Convertible Note |  | (a) (e)   |  | Specialty Finance            |  | 6.00%        |  |                     |  | 3/31/2020 |  |   | 666,389                                |   |           | 666,389               |  |   | —                  | 
|Total Subordinated Convertible Debt              |  |           |  |                              |  |              |  |                     |  |           |  | $ | 666,389                                |   | $         | 666,389               |  | $ | —                  | 
|                                                 |  |           |  |                              |  |              |  |                     |  |           |  |   |                                        |   |           |                       |  |   |                    | 
|Equity/Other—3.19%                               |  |           |  |                              |  |              |  |                     |  |           |  |   |                                        |   |           |                       |  |   |                    | 
|ACON IWP Investors I, L.L.C.                     |  | (a)       |  | Healthcare & Pharmaceuticals |  |              |  |                     |  |           |  |   | 500,000                                |   |           | 500,000               |  |   | 537,903            | 
|Javlin Capital LLC Class C-2 Preferred Units     |  | (a)(d)(e) |  | Specialty Finance            |  |              |  |                     |  |           |  |   | 214,286                                |   |           | 750,000               |  |   | —                  | 
|Total Equity/Other                               |  |           |  |                              |  |              |  |                     |  |           |  |   | 714,286                                |   | $         | 1,250,000             |  | $ | 537,903            | 
|                                                 |  |           |  |                              |  |              |  |                     |  |           |  |   |                                        |   |           |                       |  |   |                    | 
|TOTAL INVESTMENTS—71.43%                         |  |           |  |                              |  |              |  |                     |  |           |  |   |                                        |   | $         | 13,550,048            |  | $ | 12,035,538         | 
|OTHER ASSETS IN EXCESS OF LIABILITIES—28.57%     |  |           |  |                              |  |              |  |                     |  |           |  |   |                                        | $ | 4,813,699 |                      
|NET ASSETS - 100.0%                              |  |           |  |                              |  |              |  |                     |  |           |  |   |                                        |   |           |                       |  | $ | 16,849,237         | 










| | (a) | Affiliated investment as defined by the 1940 Act. whereby the Company owns between 5% and 25% of the portfolio company’s
                                                            outstanding voting securities and the investments are not classified as controlled investments. Affiliated funds that are
                                                            managed by an affiliate of Triton Pacific Adviser, LLC also hold investments in this security. The aggregate fair value of
                                                            non-controlled, affiliated investments at December 31, 2017 represented 68.24% of the Company’s net assets. Fair value
                                                            as of December 31, 2017 along with transactions during the period  ended December 31, 2017 in affiliated investments were as
                                                            follows:
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|                                           |  |                                     |           |  | Year Ended December 31,
    2017 |   |        | Interest
    &                | 
|------------------------------------------ |  | ----------------------------------- | --------- |  | -------------------------------- | - | ------ | ----------------------------- | 
|Non-controlled,
    Affiliated Investments |  | Fair
    Value at December 31, 2016 |           |  | Gross
    Additions (Cost)*      |   |        | Gross
    Reductions (Cost)** | 
|ACON IWP Investors I, L.L.C.               |  | $                                   | 691,072   |  |                                  | $ | —      |                               | 
|Javlin Capital, LLC, Convertible Note      |  |                                     | 646,901   |  |                                  |   | 19,488 |                               | 
|Javlin Capital, LLC, C-2 Preferred Units   |  |                                     | 537,229   |  |                                  |   | —      |                               | 
|Total                                      |  | $                                   | 1,875,202 |  |                                  | $ | 19,488 |                               | 



*Gross additions include increases in the cost basis
of investments resulting from new portfolio investments. PIK interest, the amortization of unearned income, the exchange of
one or more existing securities for one or more new securities and the movement of an existing portfolio company into this
category from a different category.



**Gross reductions include decreases in the cost basis of investments
resulting from principal collections related to investment repayments or sales, the exchange  of one or more existing securities
for one or more new securities and the movement of an existing portfolio company out of this category into a different category.



| | (b) | The majority of the investments bear interest at a rate that may be determined by reference to London Interbank Offered Rate
(“LIBOR” or “L”) or Prime Rate (“Prime” or “P”) which reset daily, monthly, quarterly,
or semiannually. For each such investment, the Company has provided the spread over LIBOR or Prime and the current contractual
interest rate in effect at December 31, 2017. Certain investments are subject to a LIBOR or Prime interest rate floor. As of December
31, 2017, the three-month London Interbank Offered Rate, or LIBOR, was 1.69465%.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (c) | Fair value and market value are determined by the Company’s board of directors (see Note 7.)
| | --- | --------------------------------------------------------------------------------------------



| | (d) | Security held within TPJ Holdings, Inc., a wholly-owned subsidiary of the Company. See Note 2 for a discussion on the basis
of consolidation.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------



| | (e) | The investment is not a qualifying asset under the Investment Company Act of 1940, as amended. A business development
                                                            company may not acquire any asset other than a qualifying asset, unless, at the time the acquisition is made, qualifying
                                                            assets represent at least 70% of the business development company’s total assets. As of December 31,2017, 100% of the
                                                            Company’s total assets represented qualifying assets.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (f) | See Note 5 for a discussion of the tax cost of the portfolio.
| | --- | -------------------------------------------------------------







The accompanying notes are an integral
part of these statements.





10







Triton
Pacific Investment Corporation, Inc.



NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS



(Unaudited)



NOTE 1 – DESCRIPTION OF BUSINESS



Triton Pacific Investment Corporation,
Inc. (the “Company”), incorporated in Maryland on April 29, 2011, is publicly registered, non-traded fund focused on
private equity, structured as a business development company, that primarily makes structured equity and debt investments in small
to mid-sized private U.S. companies. Structured equity refers to derivative investment products, including convertible notes and
warrants, designed to facilitate highly customized risk-return objectives. Pursuant to the Articles of Incorporation, the Company
is authorized to issue 75,000,000 shares of common stock with a par value of $0.001 per share. Additionally, the Company is authorized
to issue 25,000,000 shares of preferred stock with a par value of $0.001 per share. The Company is currently offering for sale
a maximum of $300,000,000 of shares of common stock on a “best efforts” basis pursuant to a registration statement on
Form N-2 filed with the Securities and Exchange Commission under the Securities Act of 1933, as amended (the “Offering”).
On June 25, 2014, the Company met its minimum offering requirement of $2,500,000 and released all shares held in escrow.



The Company invests either alone or together
with other private equity sponsors. The Company is an externally managed, non-diversified closed-end investment company that has
elected to be treated as a business development company, or BDC, under the Investment Company Act of 1940, or the Company Act.
As a BDC, the Company is required to comply with certain regulatory requirements. The Company has elected to be treated for U.S.
federal income tax purposes, and intends to annually qualify as a regulated investment company, or RIC, under Subchapter M of the
Internal Revenue code of 1986, as amended, or the Code. The Company has one wholly-owned subsidiary through which it holds interest
in a non-controlled, affiliated portfolio company. The consolidated financial statements include both the Company’s accounts
and the accounts of its wholly-owned subsidiary. All significant intercompany transactions have been eliminated in consolidation.
The Company’s consolidated subsidiary is subject to U.S. federal and state income taxes. No taxes were accrued or paid by
the wholly-owned subsidiary for the three months ended March 31, 2018 and 2017.



Triton Pacific Adviser, LLC (“Adviser”)
serves as the Investment Adviser and TFA Associates, LLC (“TFA”) serves as the Administrator. Each of these entities
are affiliated with Triton Pacific Group, Inc., a private equity investment management firm, and its subsidiary Triton Pacific
Capital Partners, LLC, a private equity investment fund management company, each focused on debt and equity investments for small
to mid-sized private companies.



The Adviser was formed in Delaware as a
private investment management firm and is registered as an investment adviser with the Securities and Exchange Commission (“SEC”)
under the Investment Advisers Act of 1940, or the Advisers Act. The Adviser oversees the management of the Company’s activities
and is responsible for making the investment decisions for the portfolio.



NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES



Basis of Presentation.These
financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America
(“GAAP”) for interim financial information, including accounting for investment companies under Financial Accounting
Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 946, Financial Services – Investment
Companies, and the rules and regulations of the Securities and Exchange Commission for interim financial statements. These financial
statements reflect all adjustments and accruals of a normal recurring nature that, in the opinion of management, are necessarily
indicative of results expected for any future period. These interim, unaudited financial statements and related notes should be
read in conjunction with the financial statements and related notes included in the Company’s annual report on Form 10-K
for the year ended December 31, 2017.



Management Estimates and Assumptions.The preparation of unaudited, consolidated financial statements in conformity with GAAP requires management to make estimates
and assumptions that affect the amounts of assets and liabilities, and disclosure of contingent assets and liabilities, at the
date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results
could differ from those estimates.





11







Cash.All cash balances are
maintained with high credit quality financial institutions which are members of the Federal Deposit Insurance Corporation. The
Company maintains cash balances that may exceed federally insured limits.



Valuation of Portfolio Investments.The Company determines the net asset value of its investment portfolio each quarter. Securities that are publicly-traded
are valued at the reported closing price on the valuation date. Securities that are not publicly-traded are valued at fair value
as determined in good faith by the Company’s board of directors. In connection with that determination, the Adviser provides
the Company’s board of directors with portfolio company valuations which are based on relevant inputs which may include indicative
dealer quotes, values of like securities, recent portfolio company financial statements and forecasts, and also may include valuations
prepared by third-party valuation services.



ASC Topic 820, Fair Value Measurements
and Disclosure, clarifies the definition of fair value and requires companies to expand their disclosure about the use of fair
value to measure assets and liabilities in interim and annual periods subsequent to initial recognition. ASC Topic 820 defines
fair value as the price that would be received from the sale of an asset or paid to transfer a liability in an orderly transaction
between market participants at the measurement date. ASC Topic 820 also establishes a three-tier fair value hierarchy, which prioritizes
the inputs used in measuring fair value. These tiers include: Level 1, defined as observable inputs such as quoted prices in active
markets; Level 2, which includes inputs such as quoted prices for similar securities in active markets and quoted prices for identical
securities where there is little or no activity in the market; and Level 3, defined as unobservable inputs for which little or
no market data exists, therefore requiring an entity to develop its own assumptions.



With respect to investments for which market
quotations are not readily available, the Company undertakes a multi-step valuation process each quarter, as described below:



| | ● | the
Company’s quarterly valuation process begins with the Adviser’s management team providing a preliminary valuation
of each portfolio company or investment to the Company’s board of directors, which valuation may be obtained from an independent
valuation firm or Adviser, if applicable;
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ● | preliminary
valuation conclusions are then documented and discussed with the Company’s board of directors;
| | - | ----------------------------------------------------------------------------------------------------------



| | ● | the
Company’s board of directors reviews the preliminary valuation and the Adviser’s management team, together with its
independent valuation firm, if applicable, responds and supplements the preliminary valuation to reflect any comments provided
by the board of directors; and
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ● | the
Company’s board of directors discusses valuations and determines the fair value of each investment in the Company’s
portfolio in good faith based on various statistical and other factors, including the input and recommendation of the Adviser
and any third-party valuation firm, if applicable.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Determination of fair value involves subjective
judgments and estimates. Accordingly, these notes to the Company’s financial statements refer to the uncertainty with respect
to the possible effect of such valuations and any change in such valuations on the Company’s financial statements. Below
is a description of factors that the Company’s board of directors may consider when valuing the Company’s debt and
equity investments.





Valuation of fixed income investments,
such as loans and debt securities, depends upon a number of factors, including prevailing interest rates for like securities, expected
volatility in future interest rates, call features, put features and other relevant terms of the debt. For investments without
readily available market prices, the Company may incorporate these factors into discounted cash flow models to arrive at fair value.
Other factors that the Company’s board of directors may consider include the borrower’s ability to adequately service
its debt, the fair market value of the portfolio company in relation to the face amount of its outstanding debt and the quality
of collateral securing the Company’s debt investments. The determination of fair market value for the equity positions were
determined by considering, among other factors, various income scenarios and multiples of earnings before interest, taxes, depreciation
and amortization, or EBITDA, cash flows, net income, revenues, waterfall and liquidation priority and market comparables, book
value multiples, economic profits and portfolio multiples.





12







The fair values of the Company’s
investments are determined in good faith by the Company’s board of directors. The Company’s board of directors is solely
responsible for the valuation of the Company’s portfolio investments at fair value as determined in good faith pursuant to
the Company’s valuation policy and consistently applied valuation process.



Revenue Recognition.Security
transactions are accounted for on the trade date. The Company records interest income on an accrual basis to the extent it expects
to collect such amounts. The Company records dividend income on the ex-dividend date. The Company does not accrue as a receivable
interest or dividends on loans and securities if it has reason to doubt its ability to collect such income. Loan origination fees,
original issue discount and market discount are capitalized and the Company amortizes such amounts as interest income over the
respective term of the loan or security. Upon the prepayment of a loan or security, any unamortized loan origination fees and original
issue discount are recorded as interest income. Upfront structuring fees are recorded as fee income when earned. The Company records
prepayment premiums on loans and securities as fee income when it receives such amounts.



Paid-In-Kind Interest.The
company has certain investments in its portfolio that contain a payment-in-kind (“PIK”) interest provision, which represents
contractual interest or dividends that are added to the principal balance and recorded as income. For the three months ended March
31, 2018 and 2017, interest income included -0- and $9,618 of PIK interest, respectively. The Company stops accruing PIK interest
when it is determined that PIK interest is no longer collectible. To maintain RIC tax treatment, and to avoid corporate tax, substantially
all of this income must be paid out to the stockholders in the form of distributions, even though the Company has not yet collected
the cash.



Net Realized Gains or Losses, and
Net Change in Unrealized Appreciation or Depreciation. Gains or losses on the sale of investments are calculated by using
the specific identification method. The Company measures realized gains or losses by the difference between the net proceeds from
the repayment or sale and the amortized cost basis of the investment, without regard to unrealized appreciation or depreciation
previously recognized, but considering unamortized upfront fees. Net change in unrealized appreciation or depreciation reflects
the change in portfolio investment values during the reporting period, including any reversal of previously recorded unrealized
gains or losses when gains or losses are realized.



Capital Gains Incentive Fees.
The Company has entered into an investment advisory agreement with the Adviser dated as of July 27, 2012. Pursuant to the terms
of the investment advisory agreement, the Incentive Fee shall be determined and payable in arrears as of the end of each quarter,
upon liquidation of the Company or upon termination of this Agreement, as of the termination date, and shall equal 20.0% of the
Company’s realized capital gains, if any, on a cumulative basis from inception through the end of each quarter, computed
net of all realized capital losses and unrealized capital depreciation on a cumulative basis, less the aggregate amount of any
previously paid Incentive Fees. The fee for the three months ended March 31, 2018 and 2017 was -0- and $18,439, respectively.



For purposes of calculating the foregoing:
(1) the calculation of the Incentive Fee shall include any capital gains that result from cash distributions that are treated as
a return of capital; (2) any such return of capital shall be treated as a decrease in the Company’s cost basis of an investment;
and (3) all fiscal year-end valuations shall be determined by the Company in accordance with generally accepted accounting principles,
applicable provisions of the Company Act (even if such valuation is made prior to the date on which the Company has elected to
be regulated as a BDC) and the Company’s pricing procedures. In determining the Incentive Fee payable to the Adviser, the
Company will calculate the aggregate realized capital gains, aggregate realized capital losses and aggregate unrealized capital
depreciation, as applicable, with respect to each of the investments in its portfolio. For this purpose, aggregate realized capital
gains, if any, will equal the sum of the differences between the net sales price of each investment, when sold, and the original
cost of such investment since inception. Aggregate realized capital losses will equal the sum of the amounts by which the net sales
price of each investment, when sold, is less than the cost of such investment since inception. Aggregate unrealized capital depreciation
will equal the sum of the difference, if negative, between the valuation of each investment as of the applicable date and the original
cost of such investment. At the end of the applicable period, the amount of capital gains that serves as the basis for the Company’s
calculation of the Incentive Fees will equal the aggregate realized capital gains less aggregate realized capital losses and less
aggregate unrealized capital depreciation with respect to its portfolio of investments. If this number is positive at the end of
such period, then the Incentive Fees for such period will be equal to 20% of such amount, less the aggregate amount of any Incentive
Fees paid in respect of its portfolio in all prior periods.





13







Offering Costs.The Company
will incur certain expenses in connection with registering to sell shares of its common stock in connection with the Offering.
These costs principally relate to professional and filing fees. Upon recognition or repayment to the Adviser of these costs, they
will be capitalized as deferred offering expenses and then subsequently expensed over a 12-month period. The Adviser may reimburse
the Company for all or part of these amounts pursuant to the Expense Support and Conditional Reimbursement Agreement (“Expense
Reimbursement Agreement”) discussed below. As of March 31, 2018, $3,314,687 of offering costs have been reclassified and
included as part of the Expense Reimbursement Agreement and accordingly included in Reimbursement due from the Adviser. Of these
expenses, $1,941,553 has exceeded the three-year period for repayment and will not be repayable by the Company. For the three months
ended March 31, 2018, the Company incurred $89,476 in offering costs that were not reimbursed by the Sponsor, of which $31,215
was expensed by the Company for the three months ended March 31, 2018.



Distributions. Distributions
to the Company’s stockholders are recorded as of the record date. Subject to the discretion of the Company’s board
of directors and applicable legal restrictions, the Company intends to authorize and declare ordinary cash distributions on a monthly
basis and pay such distributions on a monthly basis.



Income Taxes.The Company
has elected to be treated for federal income tax purposes, and intends to annually qualify thereafter, as a regulated investment
company (“RIC”) under Subchapter M of the Code. Generally, a RIC is exempt from federal income taxes if it distributes
at least 90% of “Investment Company Taxable Income,” as defined in the Code, each year. Dividends paid up to 8.5 months
after the current tax year can be carried back to the prior tax year for determining the dividends paid in such tax year. The Company
intends to distribute sufficient dividends to maintain its RIC status each year. The Company is also subject to nondeductible federal
excise taxes if it does not distribute at least 98% of net ordinary income, 98.2% of capital gain income, if any, and any recognized
and undistributed income from prior years for which it paid no federal excise tax. The Company will generally endeavor each year
to avoid any federal excise taxes.



GAAP requires management to evaluate tax
positions taken by the Company and recognize a tax liability if the Company has taken an uncertain position that more likely than
not would not be sustained upon examination by the Internal Revenue Service or other tax authorities. Management has analyzed the
tax positions taken by the Company, and has concluded that as of March 31, 2018 and 2017, there are no uncertain positions taken
or expected to be taken that would require recognition of a liability or disclosure in the financial statements. The Company is
subject to routine audits by the Internal Revenue Service or other tax authorities, generally for three years after the tax returns
are filed; however, there are currently no audits for any tax periods in progress.



NOTE 3 – SHARE TRANSACTIONS



Below is a summary of transactions with respect to shares of
the Company’s common stock during the three months ended March 31, 2018 and 2017:





|                                                |  | Three months ended
    March 31, |          
|----------------------------------------------- |  | -------------------------------- | ---------
|                                                |  | 2018                             |          
|                                                |  | Shares                           |          
|Gross proceeds from Offering                    |  |                                  | 68,506.32
|Reinvestment of Distributions                   |  |                                  | 6,815.35 
|Commissions and Dealer Manager Fees             |  |                                  | —        
|Net Proceeds to Company from Share Transactions |  |                                  | 75,321.67









14







Status of Continuous Public Offering



During the three months ended March 31,
2018 and 2017, the Company sold 68,506.32 and 120,883.50 shares of common stock, respectively, for gross proceeds of approximately
$918,640 and $1,842,000, at an average price per share of $13.41 and $15.24, respectively. The increase in Capital in excess of
par during the three months ended March 31, 2018 and 2017 include reinvested stockholder distributions of $82,533 and $65,679,
respectively, for which the Company issued 6,815.35 and 4,773.42 shares of common stock, respectively.



The proceeds from the issuance of common
stock as presented on the accompanying statements of changes in net assets and statements of cash flows are presented net of selling
commissions and dealer manager fees of $88,784 and $174,651 for the three months ended March 31, 2018 and 2017, respectively.



Share Repurchase Program



The Company intends to continue to conduct
quarterly tender offers pursuant to its share repurchase program. The Company’s board of directors will consider the following
factors, among others, in making its determination regarding whether to cause the Company to offer to repurchase shares of common
stock and under what terms:



| | ● |  | the effect of such repurchases on the Company’s qualification as a RIC (including the consequences of any necessary asset sales);
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------

| | ● |  | the liquidity of the Company’s assets (including fees and costs associated with disposing of assets);
| | - |  | -----------------------------------------------------------------------------------------------------

| | ● |  | the Company’s investment plans and working capital requirements;
| | - |  | ----------------------------------------------------------------

| | ● |  | the relative economies of scale with respect to the Company’s size;
| | - |  | -------------------------------------------------------------------

| | ● |  | the Company’s history in repurchasing shares of common stock or portions thereof; and
| | - |  | -------------------------------------------------------------------------------------

| | ● |  | the condition of the securities markets.
| | - |  | ----------------------------------------

The Company currently intends to limit
the number of shares of common stock to be repurchased during any calendar year to the number of shares of common stock it can
repurchase with the proceeds it receives from the issuance of shares of common stock under its distribution reinvestment plan.
At the discretion of the Company’s board of directors, the Company may also use cash on hand, cash available from borrowings
and cash from the liquidation of securities investments as of the end of the applicable period to repurchase shares of common stock.
In addition, the Company will limit the number of shares of common stock to be repurchased in any calendar year to 10% of the weighted
average number of shares of common stock outstanding in the prior calendar year, or 2.5% in each calendar quarter, though the actual
number of shares of common stock that the Company offers to repurchase may be less in light of the limitations noted above.



Our board of directors reserves the right,
in its sole discretion, to limit the number of shares to be repurchased for each class by applying the limitations on the number
of shares to be repurchased, noted above, on a per class basis. We further anticipate that we will offer to repurchase such shares
on each date of repurchase at a price equal to 90% of the current offering price on each date of repurchase. If the amount of repurchase
requests exceeds the number of shares we seek to repurchase, we will repurchase shares on a pro-rata basis. As a result, we may
repurchase less than the full amount of shares that shareholders submit for repurchase. If we do not repurchase the full amount
of the shares that shareholders have requested to be repurchased, or we determine not to make repurchases of our shares, shareholders
may not be able to dispose of their shares. Any periodic repurchase offers will be subject in part to our available cash and compliance
with the Company Act.





15







The following table provides information
concerning the Company’s repurchase of shares of common stock during the three months ended March 31, 2018 and 2017:





|For
    the Three Months Ended |  |  | Repurchase
    Date |  | Shares
    Repurchased |           |  | Percentage
    of Shares Tendered That Were Repurchased |  |    | Average
    Price Paid Per Share |  |   | Aggregate
    Consideration for Repurchased Shares | 
|------------------------------ |  |  | ------------------- |  | ---------------------- | --------- |  | ------------------------------------------------------- |  | -- | -------------------------------- |  | - | -------------------------------------------------- | 
|Fiscal 2018                    |  |  |                     |  |                        |           |  |                                                         |  |    |                                  |  |   |                                                    | 
|March 31, 2018                 |  |  | March 28, 2018      |  |                        | 6,388.01  |  |                                                         |  | 11 | %                                |  | $ | 12.11                                              | 
|Fiscal 2017                    |  |  |                     |  |                        |           |  |                                                         |  |    |                                  |  |   |                                                    | 
|March 31, 2017                 |  |  | January 20, 2017    |  |                        | 8,482.60  |  |                                                         |  | 27 | %                                |  | $ | 13.87                                              | 
|June 30, 2017                  |  |  | May 12, 2017        |  |                        | 1,936.81  |  |                                                         |  | 6  | %                                |  |   | 13.55                                              | 
|September 30, 2017             |  |  | September 25, 2017  |  |                        | 5,968.22  |  |                                                         |  | 9  | %                                |  |   | 12.30                                              | 
|December 31, 2017              |  |  | December 22,2017    |  |                        | 6,212.40  |  |                                                         |  | 10 | %                                |  |   | 12.11                                              | 
|Total                          |  |  |                     |  |                        | 22,600.03 |  |                                                         |  | 12 | %                                |  |   | 12.94                                              | 







NOTE 4 – RELATED PARTY TRANSACTIONS
AND ARRANGEMENTS



The Adviser and TFA and their affiliates
will receive compensation and reimbursement for services relating to our offering and the investment and management of its assets.



In connection with the Offering, the Company
has incurred registration, organization, operating and offering costs. Such costs have been advanced by the Adviser. As discussed
below, the Company has entered into an Expense Reimbursement Agreement with its Adviser. For the period from inception through
March 31, 2018, certain registration, organization, operating and offering costs have been accounted for under the Expense Reimbursement
Agreement and accordingly included in Reimbursement due from the Adviser on the statements of financial position.



The table below, on a cumulative basis,
discloses the components of the Reimbursement due from Adviser reflected on the Consolidated Statements of Financial Position:





|                                     |  | March 31, |            |   | December 31, |  
|------------------------------------ |  | --------- | ---------- | - | ------------ | -
|                                     |  | 2018      |            |   | 2017         |  
|Operating Expenses                   |  | $         | 1,977,504  |   |              | $
|Offering Costs                       |  |           | 3,314,687  |   |              |  
|Due to related party offset          |  |           | (4,780,282 | ) |              |  
|Reimbursements received from Adviser |  |           | (342,715   | ) |              |  
|Other amounts due to affiliates      |  |           | 15,559     |   |              |  
|Total Reimbursement due from Adviser |  | $         | 184,753    |   |              | $







Operating Expenses are the amounts
reimbursed by the Adviser for our operating costs and offering costs are the cumulative amount of organizational and
offering expenses reimbursed to us by the Adviser and subject to future reimbursement per the terms of our expense reimbursement
agreement.



Due to related party offset represents
the cash the Adviser paid directly for our operating and offering expenses and reimbursements received from sponsor are
the amounts the Adviser paid in cash to us for reimbursement of our operating and offering costs.



The Company compensates the Adviser for
investment services per an Investment Adviser Agreement (“Agreement”), approved by the Company’s directors, calculated
as the sum of (1) base management fee, calculated quarterly at 0.5% of the Company’s average gross assets payable quarterly
in arrears, and (2) an incentive fee upon capital gains determined and payable in arrears as of the end of each quarter or upon
liquidation of the Company or upon termination of Agreement at 20% of Company’s realized capital gains, as defined. The Agreement
expires July 2018 and may continue automatically for successive annual periods, as approved by the Company. All management fees
earned by the Adviser prior to January 1, 2014 were waived by the Adviser.



As a BDC, we will be subject to certain
regulatory restrictions in making our investments. For example, we generally will not be permitted to co-invest alongside our Adviser
and its affiliates unless we obtain an exemptive order from the SEC or the transaction is otherwise permitted under existing regulatory
guidance, such as syndicated transactions where price is the only negotiated term, and approval from our independent directors.
As of March 31, 2018, the Company has two affiliate investments in ACON IWP Investors I, L.L.C and Javlin Capital, LLC (held by
TPJ Holdings, Inc., a wholly-owned subsidiary.)





16







The Company compensates TFA for administration
services per an Administration Agreement for costs and expenses incurred with the administration and operation of the Company.
Such agreement expires July 2018 and may continue automatically for successive annual periods, as approved by the Company. These
fees have been reimbursed from the Adviser pursuant to the Expense Reimbursement Agreement discussed below.



The following table describes the fees
and expenses accrued under the investment advisory and administration agreement and the dealer manager agreement during the three
months ended March 31, 2018 and 2017:





|                               |  |                              |  |                                  |  | Three
    months ended March 31 |       
|------------------------------ |  | ---------------------------- |  | -------------------------------- |  | ------------------------------- | ------
|Related Party                  |  | Source Agreement             |  | Description                      |  | 2018                            |       
|Triton Pacific Adviser, LLC    |  | Investment Adviser Agreement |  | Base Management Fees             |  | $                               | 88,296
|Triton Pacific Adviser, LLC    |  | Investment Adviser Agreement |  | Capital Gains Incentive Fees(1)  |  | $                               | —     
|TFA Associates, LLC            |  | Administration Agreement     |  | Administrative Services Expenses |  | $                               | 74,395
|Triton Pacific Securities, LLC |  | Dealer Manager Agreement     |  | Dealer Manager Fees(2)           |  | $                               | 17,320














| | (1) | During the three months ended March 31, 2018 and 2017, the Company earned capital gains incentive fees of $0 and $18,439, respectively,
based on the performance of its portfolio, of all were based on unrealized gains. No capital gains incentive fees are actually
payable by the Company with respect to unrealized gains unless and until those gains are actually realized. See Note 2 for a discussion
of the methodology employed by the Company in calculating the capital gains incentive fees.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (2) | During the three months ended March 31, 2018 and 2017, the Company paid the Dealer Manager $88,784 and $174,651, respectively,
in sales commissions and dealer fees. $17,320 and $34,770 were retained by TPS, respectively, and the remainder re-allowed to third
party participating broker dealers.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Expense Reimbursement Agreement



On March 27, 2014, the Company and its
Adviser agreed to an Expense Support and Conditional Reimbursement Agreement, or the Expense Reimbursement Agreement. The Expense
Reimbursement Agreement was amended and restated effective November 17, 2014. Under the Expense Reimbursement Agreement, as amended,
the Adviser, in consultation with the Company, will pay up to 100% of both the Company’s organizational and offering expenses
and its operating expenses, all as determined by the Company and the Adviser. As used in the Expense Reimbursement Agreement, operating
expenses refer to third party operating costs and expenses incurred by the Company, as determined under GAAP for investment management
companies. Organizational and offering expenses include expenses incurred in connection with the organization of the Company and
expenses incurred in connection with its offering, which are recorded as a component of equity. The Expense Reimbursement Agreement
states that until the net proceeds to the Company from its offering are at least $25 million, the Adviser will pay up to 100% of
both the Company’s organizational and offering expenses and its operating expenses. After the Company receives at least $25
million in net proceeds from its offering, the Adviser may, with the Company’s consent, continue to make expense support
payments to the Company in such amounts as are acceptable to the Company and the Adviser. Any expense support payments shall be
paid by the Adviser to the Company in any combination of cash, and/or offsets against amounts otherwise due from the Company to
the Adviser.



Under the Expense Reimbursement Agreement
as amended, once the Company has received at least $25 million in net proceeds from its offering, during any quarter occurring
within three years of the date on which the Company incurred any expenses that are funded by the Adviser, the Company is required
to reimburse the Adviser for any expense support payments the Company received from them. However, with respect to any expense
support payments attributable to the Company’s operating expenses, (i) the Company will only reimburse the Adviser for
expense support payments made by the Adviser to the extent that the payment of such reimbursement (together with any other reimbursement
paid during such fiscal year) does not cause “other operating expenses” (as defined below) (on an annualized basis
and net of any expense reimbursement payments received by the Company during such fiscal year) to exceed the percentage of the
Company’s average net assets attributable to shares of its common stock represented by “other operating expenses”
during the fiscal year in which such expense support payment from the Adviser was made (provided, however, that this clause (i) shall
not apply to any reimbursement payment which relates to an expense support payment from the Adviser made during the same fiscal
year); and (ii) the Company will not reimburse the Adviser for expense support payments made by the Adviser if the annualized
rate of regular cash distributions declared by the Company at the time of such reimbursement payment is less than the annualized
rate of regular cash distributions declared by the Company at the time the Adviser made the expense support payment to which such
reimbursement relates. “Other operating expenses” means the Company’s total operating expenses excluding base
management fees, incentive fees, organization and offering expenses, financing fees and costs, interest expense, brokerage commissions
and extraordinary expenses.





17











|Quarter
    Ended  |  | Amount
    of Expense Payment Obligation |  | Amount
    of Offering Cost Payment Obligation |  | Operating
    Expense Ratio as of the Date Expense Payment Obligation Incurred(1) |  | Annualized
    Distribution Rate as of the Date Expense Payment Obligation Incurred(2) |  | Eligible
    for Reimbursement Through
|------------------ |  | ---------------------------------------- |  | ---------------------------------------------- |  | --------------------------------------------------------------------------------- |  | -------------------------------------------------------------------------------------- |  | --------------------------------------
|September 30, 2012 |  | $21,826                                  |  | $0                                             |  | 432.69%                                                                           |  | —                                                                                      |  | September 30, 2015                    
|December 31, 2012  |  | $26,111                                  |  | $0                                             |  | 531.09%                                                                           |  | —                                                                                      |  | December 31, 2015                     
|March 31, 2013     |  | $30,819                                  |  | $0                                             |  | N/A                                                                               |  | —                                                                                      |  | March 31, 2016                        
|June 30, 2013      |  | $59,062                                  |  | $0                                             |  | N/A                                                                               |  | —                                                                                      |  | June 30, 2016                         
|September 30, 2013 |  | $65,161                                  |  | $0                                             |  | N/A                                                                               |  | —                                                                                      |  | September 30, 2016                    
|December 31, 2013  |  | $91,378                                  |  | $0                                             |  | 455.09%                                                                           |  | —                                                                                      |  | December 31, 2016                     
|March 31, 2014     |  | $68,293                                  |  | $0                                             |  | 148.96%                                                                           |  | —                                                                                      |  | March 31, 2017                        
|June 30, 2014      |  | $70,027                                  |  | $898,518                                       |  | 23.17%                                                                            |  | —                                                                                      |  | June 30, 2017                         
|September 30, 2014 |  | $92,143                                  |  | $71,060                                        |  | 20.39%                                                                            |  | —                                                                                      |  | September 30, 2017                    
|December 31, 2014  |  | $115,777                                 |  | $90,860                                        |  | 11.15%                                                                            |  | —                                                                                      |  | December 31, 2017                     
|March 31, 2015     |  | $134,301                                 |  | $106,217                                       |  | 13.75%                                                                            |  | 2.01%                                                                                  |  | March 31, 2018                        
|June 30, 2015      |  | $166,549                                 |  | $167,113                                       |  | 14.10%                                                                            |  | 3.20%                                                                                  |  | June 30, 2018                         
|September 30, 2015 |  | $147,747                                 |  | $240,848                                       |  | 10.45%                                                                            |  | 3.20%                                                                                  |  | September 30, 2018                    
|December 31, 2015  |  | $136,401                                 |  | $280,376                                       |  | 7.41%                                                                             |  | 3.60%                                                                                  |  | December 31, 2018                     
|March 31, 2016     |  | $157,996                                 |  | $232,895                                       |  | 6.00%                                                                             |  | 3.52%                                                                                  |  | March 31, 2019                        
|June 30, 2016      |  | $206,933                                 |  | $285,878                                       |  | 4.95%                                                                             |  | 3.52%                                                                                  |  | June 30, 2019                         
|September 30, 2016 |  | $201,573                                 |  | $223,020                                       |  | 4.52%                                                                             |  | 3.13%                                                                                  |  | September 30, 2019                    
|December 31, 2016  |  | $104,561                                 |  | $168,876                                       |  | 4.45%                                                                             |  | 3.11%                                                                                  |  | December 31, 2019                     
|March 31, 2017     |  | $80,847                                  |  | $252,875                                       |  | 4.21%                                                                             |  | 3.19%                                                                                  |  | March 31, 2020                        
|June 30, 2017      |  | $0                                       |  | $176,963                                       |  | 3.98%                                                                             |  | 3.18%                                                                                  |  | June 30, 2020                         
|September 30, 2017 |  | $0                                       |  | $119,188                                       |  | 4.19%                                                                             |  | 3.00%                                                                                  |  | September 30, 2020                    
|December 31, 2017  |  | $0                                       |  | $0                                             |  | N/A                                                                               |  | N/A                                                                                    |  | N/A                                   





|(1) | “Operating Expense Ratio” includes all expenses borne by us, except for organizational and offering expenses, base management and incentive fees owed to our Adviser, financing fees and costs, interest expense, brokerage commissions and extraordinary expenses.The Company did not achieve its minimum offering amount until June 25, 2014 and as a result, did not invest the proceeds from the offering and realize any income from investments prior to the end of its fiscal quarter.                                                                                                                                                                   
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | “Annualized Distribution Rate” equals the annualized rate of distributions paid to stockholders based on the amount of the regular cash distribution paid immediately prior to the date the expense support payment obligation was incurred by our Adviser. “Annualized Distribution Rate” does not include special cash or stock distributions paid to stockholders. The Company did not achieve its minimum offering amount until June 25, 2014 and as a result, did not have an opportunity to invest the proceeds from the offering and realize any income from investments or pay any distributions to stockholders prior to the end of its fiscal quarter.

In addition, with respect to any expense
support payment attributable to the Company’s organizational and offering expenses, the Company will only reimburse the Adviser
for expense support payments made by the Adviser to the extent that the payment of such reimbursement (together with any other
reimbursement for organizational and offering expenses paid during such fiscal year) is limited to 15% of cumulative gross sales
proceeds from the Company’s offering including the sales load (or dealer manager fee) paid by the Company.



The Company or the Adviser may terminate
the expense reimbursement agreement at any time upon thirty days’ written notice. The expense reimbursement agreement will
automatically terminate upon termination of the Investment Advisory Agreement or upon our liquidation or dissolution. The
expense reimbursement agreement expires by its terms on December 31, 2018, unless extended with the mutual consent of us and our
Adviser.





18







The Expense Reimbursement Agreement is,
by its terms, effective retroactively to the Company’s inception date of April 29, 2011 for Operating Expenses and from the
break of escrow on June 25, 2014 for Offering Expenses. As of March 31, 2018, $5,292,191 has been recorded as Reimbursement due
from the Adviser pursuant to the Expense Reimbursement Agreement. Of this, $4,780,282, representing an amount due to the Adviser,
was netted against the Reimbursement due from Adviser and $342,715 was paid to the Company by the Adviser.



Beginning the year ended December 31, 2016,
the Adviser began to reimburse less than 100% of operating expenses, and for the year ended December 31, 2017, the Adviser did
not reimburse any operating expenses after the first quarter. Additionally, the Adviser did not reimburse any offering expenses
for the first quarter of 2018 and fourth quarter of 2017. Of these Operating Expenses in the table above, $1,941,553 has exceeded
the three-year period for repayment and will not be repayable by the Company.



NOTE 5 – DISTRIBUTIONS



The following table reflects the cash distributions per share
that the Company declared and paid on its common stock during the three months ended March 31, 2018 and 2017:





|                               |  |  | Distribution |        
|------------------------------ |  |  | ------------ | -------
|For
    the Three Months Ended |  |  | Per Share    |        
|Fiscal 2018                    |  |  |              |        
|January 29, 2018               |  |  | $            | 0.03370
|February 28, 2018              |  |  | $            | 0.03370
|March 28, 2018                 |  |  | $            | 0.03370
|                               |  |  |              |        
|Fiscal 2017                    |  |  |              |        
|January 27, 2017               |  |  | $            | 0.04000
|February 24, 2017              |  |  | $            | 0.04000
|March 23, 2017                 |  |  | $            | 0.04000









On April 24, 2018, the Company authorized
and declared a cash distribution of $0.0337 per share for the month of April 2018, to the shareholders of record as of April 26,
2018. The timing and amount of any future distributions to stockholders are subject to applicable legal restrictions and the sole
discretion of the Company’s board of directors.



The Company has adopted an “opt in”
distribution reinvestment plan for its stockholders. As a result, if the Company makes a cash distribution, its stockholders will
receive distributions in cash unless they specifically “opt in” to the distribution reinvestment plan so as to have
their cash distributions reinvested in additional shares of the Company’s common stock. However, certain state authorities
or regulators may impose restrictions from time to time that may prevent or limit a stockholder’s ability to participate
in the distribution reinvestment plan.



The Company may fund its cash distributions
to stockholders from any sources of funds legally available to it, including offering proceeds, borrowings, net investment income
from operations, capital gains proceeds from the sale of assets, non-capital gains proceeds from the sale of assets, dividends
or other distributions paid to the Company on account of preferred and common equity investments in portfolio companies and expense
reimbursements from the Adviser. The Company has not established limits on the amount of funds it may use from available sources
to make distributions.





19







The following table reflects the sources
of the cash distributions on a tax basis that the Company paid on its common stock during the three months ended March 31, 2018
and 2017:





|                                                          |  | Three months ended March 31, |        
|--------------------------------------------------------- |  | ---------------------------- | -------
|                                                          |  | 2018                         |        
|Source
    of Distribution                                |  | Distribution
    Amount      |        
|Offering proceeds                                         |  | $                            | —      
|Borrowings                                                |  |                              | —      
|Net investment income(1)                                  |  |                              | —      
|Short-term capital gains proceeds from the sale of assets |  |                              | 13,000 
|Long-term capital gains proceeds from the sale of assets  |  |                              | 47,908 
|Distributions from common equity (return of capital)      |  |                              | 85,819 
|Expense reimbursement from sponsor                        |  |                              | —      
|Total                                                     |  | $                            | 146,727




















| | (1) | During the three months ended March 31, 2018 and 2017, 97.0% and 90.3%, respectively, of the Company’s gross investment
income was attributable to cash income earned, and 3.0% and 9.7%, resepctively was attributable to non-cash accretion of discount
and paid in-kind interest.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





The Company’s net investment income
(loss) on a tax basis for the three months ended March 31, 2018 and 2017 was $(27,699) and $30,727, respectively. As of March 31,
2018 and 2017, the Company had $(508,578) and $31,395, respectively, of undistributed (overdistributed) net investment income and
realized gains on a tax basis.



The primary difference between the Company’s GAAP-basis
net investment income and its tax-basis net investment income is due to the reversal of the required accrual for GAAP purposes
of incentive fees on unrealized gains even though no such incentive fees on unrealized gains are payable by the Company for the
three months ended March 31, 2018 and 2017.



The following table sets forth reconciliation between GAAP basis
net investment income and tax basis net investment income for the three months ended March 31, 2018 and 2017:





|                                                      |  | Three
    months ended March 31, |        
|----------------------------------------------------- |  | -------------------------------- | -------
|                                                      |  | 2018                             |        
|GAAP basis net investment income (loss)               |  | $                                | (27,699
|Reversal of incentive fee accrual on unrealized gains |  |                                  | —      
|Other book-tax differences                            |  |                                  | —      
|Tax-basis net investment income (loss)                |  | $                                | (27,699





The determination of the tax attributes
of the Company’s distributions is made annually as of the end of the Company’s fiscal year based upon the Company’s
taxable income for the full year and distributions paid for the full year. The actual tax characteristics of distributions to stockholders
are reported to stockholders annually on Form 1099-DIV.



As of March 31, 2018 and 2017, the components of accumulated
earnings on a tax basis were as follows:





|                                                                                      |  | Three
    months ended March 31, |           
|------------------------------------------------------------------------------------- |  | -------------------------------- | ----------
|                                                                                      |  | 2018                             |           
|Undistributed (overdistributed) ordinary income (income and short-term capital gains) |  | $                                | (535,381  
|Distributable realized gains (long-term capital gains)                                |  |                                  | 26,803    
|Net unrealized appreciation (depreciation) on investments                             |  |                                  | (1,454,985
|                                                                                      |  | $                                | (1,963,563







The $(1,454,985)
of net depreciation as of March 31, 2018 includes gross appreciation over amortized tax cost of $223,349 and gross depreciation
under amortized tax cost of $(1,678,334). The $93,860 of net appreciation as of March 31, 2017 includes gross appreciation over
amortized tax cost of $368,446 and gross depreciation under amortized tax cost of $274,586.





20







The aggregate
cost of the Company’s investments for U.S. federal income tax purposes totaled $15,331,184 and $12,771,399 as of March 31,
2018 and 2017, respectively. The aggregate net unrealized appreciation (depreciation) on investments on a tax basis was $(1,454,985)
and $93,860 as of March 31, 2018 and 2017, respectively.



NOTE 6 – INVESTMENT PORTFOLIO



The following table summarizes the composition of the Company’s
investment portfolio at amortized cost and fair value as of March 31, 2018 and December 31, 2017:





|                                 |  | Threee
                                         months ended March 31, 2018 (Unaudited) |            |  | Year
    Ended December 31, 2017 |  
|-------------------------------- |  | --------------------------------------------------------------------------------------- | ---------- |  | -------------------------------- | -
|                                 |  | Investments
    at Amortized Cost(1)                                                    |            |  | Investments
    at Fair Value    |  
|                                 |  |                                                                                         |            |  |                                  |  
|Senior Secured Loans—First Lien  |  | $                                                                                       | 8,746,407  |  |                                  | $
|Senior Secured Loans—Second Lien |  |                                                                                         | 4,668,390  |  |                                  |  
|Subordinated Debt                |  |                                                                                         | 666,389    |  |                                  |  
|Equity/Other                     |  |                                                                                         | 1,250,000  |  |                                  |  
|Total                            |  | $                                                                                       | 15,331,186 |  |                                  | $













|(1) | Amortized cost represents the original cost adjusted for the amortization of premiums and/or accretion of discounts, as applicable, on investments.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------



The table below describes investments by industry classification
and enumerates the percentage, by fair value, of the total portfolio assets in such industries as of March 31, 2018 and December
31, 2017:





|                                  |  | March
    31, 2018 
    (Unaudited) |            |  | December
    31, 2017        | 
|--------------------------------- |  | ----------------------------------- | ---------- |  | ---------------------------- | 
|Industry
    Classification       |  | Fair
     Value                     |            |  | Percentage of
     Portfolio | 
|Beverage, Food & Tobacco          |  |                                     | 2,138,294  |  |                              | 
|Business Services                 |  |                                     | 4,868,879  |  |                              | 
|Consumer Services                 |  |                                     | 1,634,316  |  |                              | 
|Energy: Oil & Gas                 |  |                                     | 333,047    |  |                              | 
|Environmental                     |  |                                     | 488,750    |  |                              | 
|Healthcare & Pharmaceuticals      |  |                                     | 1,204,990  |  |                              | 
|High Tech Industries              |  |                                     | 829,175    |  |                              | 
|Hotel, Gaming & Leisure           |  |                                     | 351,565    |  |                              | 
|Media: Diversified and Production |  |                                     | 335,299    |  |                              | 
|Metals & Mining                   |  |                                     | 1,003,750  |  |                              | 
|Telecommunications                |  |                                     | 489,595    |  |                              | 
|Wholesale Trade-Nondurable Goods  |  |                                     | 198,539    |  |                              | 
|Total                             |  | $                                   | 13,876,199 |  |                              | 







NOTE 7 – FAIR VALUE OF FINANCIAL INSTRUMENTS



Under existing accounting guidance, fair
value is defined as the price that the Company would receive upon selling an investment or pay to transfer a liability in an orderly
transaction to a market participant in the principal or most advantageous market for the investment. This accounting guidance emphasizes
that valuation techniques maximize the use of observable market inputs and minimize the use of unobservable inputs. Inputs refer
broadly to the assumptions that market participants would use in pricing an asset or liability, including assumptions about risk.
Inputs may be observable or unobservable. Observable inputs are inputs that reflect the assumptions market participants would use
in pricing an asset or liability developed based on market data obtained from sources independent of the Company. Unobservable
inputs are inputs that reflect the assumptions market participants would use in pricing an asset or liability developed based on
the best information available in the circumstances.





21







The Company classifies the inputs used
to measure these fair values into the following hierarchy as defined by current accounting guidance:



Level 1: Inputs
that are quoted prices (unadjusted) in active markets for identical assets or liabilities.



Level 2: Inputs
that are quoted prices for similar assets or liabilities in active markets.



Level 3: Inputs
that are unobservable for an asset or liability.



A financial instrument’s categorization
within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement.



As of March 31, 2018 and December 31, 2017,
the Company’s investments were categorized as follows in the fair value hierarchy):





|Valuation
    Inputs                        |  | Three
    months ended March 31, 2018 (Unaudited) |            |  | Year
    ended December 31, 2017 |  
|------------------------------------------- |  | ------------------------------------------------- | ---------- |  | -------------------------------- | -
|Level 1—Price quotations in active markets  |  | $                                                 | —          |  |                                  | $
|Level 2—Significant other observable inputs |  |                                                   | —          |  |                                  |  
|Level 3—Significant unobservable inputs     |  |                                                   | 13,876,199 |  |                                  |  
|Total                                       |  | $                                                 | 13,876,199 |  |                                  | $







The Company’s investments as of March
31, 2018 consisted of debt securities that are traded on a private over-the-counter market for institutional investors, a subordinated
convertible note and two equity investments. The Company valued its debt investments by using the midpoint of the prevailing bid
and ask prices from dealers on the date of the relevant period end, which were provided by independent third-party pricing services
and screened for validity by such services. The determination of fair market value for the equity positions were determined by
considering, among other factors, various income scenarios and multiples of earnings before interest, taxes, depreciation and amortization,
or EBITDA, cash flows, net income, revenues, waterfall and liquidation priority and market comparables, book value multiples, economic
profits and portfolio multiples.



The Company may periodically benchmark
the bid and ask prices it receives from the third-party pricing services against the actual prices at which the Company purchases
and sells its investments. Based on the results of the benchmark analysis and the experience of the Company’s management
in purchasing and selling these investments, the Company believes that these prices are reliable indicators of fair value. However,
because of the private nature of this marketplace (meaning actual transactions are not publicly reported), the Company believes
that these valuation inputs are classified as Level 3 within the fair value hierarchy. The Company’s board of directors reviewed
and approved the valuation determinations made with respect to these investments in a manner consistent with the Company’s
valuation process.



The significant unobservable inputs used
in the market approach of fair value measurement of our investments are the market multiples of EBITDA of comparable companies.
The Company selects a population of companies for each investment with similar operations and attributes of the portfolio company.
Using these guideline companies’ data, a range of multiples of enterprise value to EBITDA is calculated. The Company selects
percentages from the range of multiples for purposes of determining the portfolio company’s estimated enterprise value based
on said multiple and generally the latest twelve months’ EBITDA of the portfolio company. Significant increases or decreases
in enterprise value may result in increases or decreases in the fair value estimate of the equity investment.





22







The following is a reconciliation for the
three months ended March 31, 2018 and year ended December 31, 2017 of investments for which significant unobservable inputs (Level
3) were used in determining fair value:





|                                                                                                                                                                                                       |  | For the three
    months ended March 31, 2018 |          
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ |  | --------------------------------------------- | ---------
|                                                                                                                                                                                                       |  | Senior 
    Secured Loans - First Lien        |          
|Fair value at beginning of period                                                                                                                                                                      |  | $                                             | 7,690,952
|Accretion of discount (amortization of premium)                                                                                                                                                        |  |                                               | 5,570    
|Net realized gain (loss)                                                                                                                                                                               |  |                                               | 13,000   
|Net change in unrealized appreciation (depreciation)                                                                                                                                                   |  |                                               | 83,016   
|Purchases                                                                                                                                                                                              |  |                                               | 1,465,000
|Paid-in-kind interest                                                                                                                                                                                  |  |                                               | —        
|Sales and redemptions                                                                                                                                                                                  |  |                                               | (451,586 
|Net transfers in or out of Level 3                                                                                                                                                                     |  |                                               | —        
|Fair value at end of period                                                                                                                                                                            |  | $                                             | 8,805,951
|                                                                                                                                                                                                       |  |                                               |          
|The amount of total gains or losses for the period included in changes in net assets attributable to the change in unrealized gains or losses relating to investments still held at the reporting date |  | $                                             | 83,016   











|                                                                                                                                                                                                       |  | For the year
    ended December 31, 2017 |           
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ |  | ---------------------------------------- | ----------
|                                                                                                                                                                                                       |  | Senior 
    Secured Loans - First Lien   |           
|Fair value at beginning of period                                                                                                                                                                      |  | $                                        | 6,761,313 
|Accretion of discount (amortization of premium)                                                                                                                                                        |  |                                          | 21,761    
|Net realized gain (loss)                                                                                                                                                                               |  |                                          | 50,321    
|Net change in unrealized appreciation (depreciation)                                                                                                                                                   |  |                                          | (104,169  
|Purchases                                                                                                                                                                                              |  |                                          | 4,392,250 
|Paid-in-kind interest                                                                                                                                                                                  |  |                                          | —         
|Sales and redemptions                                                                                                                                                                                  |  |                                          | (3,430,524
|Net transfers in or out of Level 3                                                                                                                                                                     |  |                                          | —         
|Fair value at end of period                                                                                                                                                                            |  | $                                        | 7,690,952 
|                                                                                                                                                                                                       |  |                                          |           
|The amount of total gains or losses for the period included in changes in net assets attributable to the change in unrealized gains or losses relating to investments still held at the reporting date |  | $                                        | (104,169  





The valuation techniques and significant
unobservable inputs used in recurring Level 3 fair value measurements of assets as of March 31, 2018 were as follows:







|Asset Category                  | Fair
    Value |            | Primary Valuation
    Technique |                                                | Unobservable
    Inputs  |                          | Range          |                | Weighted Average
|------------------------------- | -------------- | ---------- | ------------------------------- | ---------------------------------------------- | ------------------------ | ------------------------ | -------------- | -------------- | ----------------
|Senior Secured First Lien Debt  |                | 8,805,951  |                                 | Market quotes                                  |                          | Indicative dealer quotes |                | 86.81 - 102.00 |                 
|Senior Secured Second Lien Debt | 4,562,600      |            | Market quotes                   |                                                | Indicative dealer quotes |                          | 26.17 - 103.00 |                | 98.95           
|Subordinated Debt               |                | —          |                                 | Distribution waterfall/ liquidation priorities |                          | N/A                      |                | N/A            |                 
|Equity/Other                    |                | —          |                                 | Distribution waterfall/ liquidation priorities |                          | N/A                      |                | N/A            |                 
|Equity/Other                    |                | 507,648    |                                 | Market comparables                             |                          | EBITDA multiples (x)     |                | 7.15x - 9.15x  |                 
|Total                           | $              | 13,876,199 |                                 |                                                |                          |                          |                |                |                 







The valuation techniques and significant unobservable inputs
used in recurring Level 3 fair value measurements of assets as of December 31, 2017 were as follows:





|Asset Category                  | Fair
    Value |            | Primary Valuation
    Technique |                                                | Unobservable
    Inputs  |                          | Range          |                | Weighted Average
|------------------------------- | -------------- | ---------- | ------------------------------- | ---------------------------------------------- | ------------------------ | ------------------------ | -------------- | -------------- | ----------------
|Senior Secured First Lien Debt  |                | 7,690,952  |                                 | Market quotes                                  |                          | Indicative dealer quotes |                | 78.05 - 102.00 |                 
|Senior Secured Second Lien Debt | 3,806,683      |            | Market quotes                   |                                                | Indicative dealer quotes |                          | 26.67 - 103.00 |                | 98.55           
|Subordinated Debt               |                | —          |                                 | Distribution waterfall/ liquidation priorities |                          | Book value multiples (x) |                | N/A            |                 
|Equity/Other                    |                | —          |                                 | Distribution waterfall/ liquidation priorities |                          | Book value multiples (x) |                | N/A            |                 
|Equity/Other                    |                | 537,903    |                                 | Market comparables                             |                          | EBITDA multiples (x)     |                | 7.15x - 9.15x  |                 
|Total                           | $              | 12,035,538 |                                 |                                                |                          |                          |                |                |                 





On June 30, 2017, the Company made the
decision to write down the carrying value of its investment value in Javlin Financial. The decision was due to performance issues
within Javlin Financial’s core business and a breakdown in restructuring negotiations between the Company, its lenders, and
Javlin Financial’s controlling shareholder. It is unknown at this time if there will be any value to the investment.



23







NOTE 8 – FINANCIAL HIGHLIGHTS



The following is a schedule of financial highlights of the Company
for the three months ended March 31, 2018 and the year ended December 31, 2017:





|                                                                                |  | Three
    Months Ended March 31, 2018 (Unaudited) |            |   | Year
    Ended December 31, 2017 |  
|------------------------------------------------------------------------------- |  | ------------------------------------------------- | ---------- | - | -------------------------------- | -
|Per Share Data:                                                                 |  |                                                   |            |   |                                  |  
|Net asset value, beginning of period                                            |  | $                                                 | 11.89      |   |                                  | $
|Results of operations(1)                                                        |  |                                                   |            |   |                                  |  
|Net investment income (loss)                                                    |  |                                                   | (0.02      | ) |                                  |  
|Net realized and unrealized appreciation (depreciation) on investments(2)       |  |                                                   | 0.06       |   |                                  |  
|Net increase (decrease) in net assets resulting from operations                 |  |                                                   | 0.04       |   |                                  |  
|Stockholder distributions(3)                                                    |  |                                                   |            |   |                                  |  
|Distributions from net investment income                                        |  |                                                   | (0.09      | ) |                                  |  
|Distributions from net realized gain on investments                             |  |                                                   | (0.01      | ) |                                  |  
|Net decrease in net assets resulting from stockholder distributions             |  |                                                   | (0.10      | ) |                                  |  
|Capital share transactions                                                      |  |                                                   |            |   |                                  |  
|Issuance of common stock(4)                                                     |  |                                                   | 0.01       |   |                                  |  
|Net increase (decrease) in net assets resulting from capital share transactions |  |                                                   | 0.01       |   |                                  |  
|Net asset value, end of period                                                  |  | $                                                 | 11.84      |   |                                  | $
|Shares outstanding, end of period                                               |  |                                                   | 1,486,167  |   |                                  |  
|Total return(5)                                                                 |  |                                                   | 0.4        | % |                                  |  
|Ratio/Supplemental Data:                                                        |  |                                                   |            |   |                                  |  
|Net assets, end of period                                                       |  | $                                                 | 17,592,016 |   |                                  | $
|Ratio of net investment income to average net assets                            |  |                                                   | -0.2       | % |                                  |  
|Ratio of total operating expenses to average net assets                         |  |                                                   | 1.6        | % |                                  |  
|Ratio of expenses reimbursed by sponsor to average net assets                   |  |                                                   | 0.0        | % |                                  |  
|Ratio of expense recoupment payable to sponsor to average net assets            |  |                                                   | 0.0        | % |                                  |  
|Ratio of capital gain incentive fee to average net assets                       |  |                                                   | 0.0        | % |                                  |  
|Ratio of net operating expenses to average net assets                           |  |                                                   | 1.6        | % |                                  |  
|Portfolio turnover(6)                                                           |  |                                                   | 4.1        | % |                                  |  







|(1) | The per share data was derived by using the weighted average shares outstanding for the three months ended March 31, 2018 and the year ended December 31, 2017.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | The amount shown for a share outstanding throughout the year may not agree with the change in the aggregate gains and losses in portfolio securities for the year because of the timing of sales of the Company’s shares in relation to fluctuating market values for the portfolio.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|(3) | The per share data for distributions reflects the actual amount of distributions paid per share during the applicable period.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|(4) | The issuance of common stock on a per share basis reflects the incremental net asset value changes as a result of the issuance of shares of common stock in the Company’s continuous public offering and pursuant to the Company’s distribution reinvestment plan. The issuance of common stock at an offering price, net of sales commissions and dealer manager fees, that is greater or less than the net asset value per share results in an increase or decrease in net asset value per share.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|(5) | The total return for each period presented was calculated by taking the net asset value per share as of the end of the applicable period, adding the cash distributions per share which were declared during the applicable calendar year and dividing the total by the net asset value per share at the beginning of the applicable year. The total return does not consider the effect of the sales load from the sale of the Company’s common stock. The total return includes the effect of the issuance of shares at a net offering price that is greater than net asset value per share, which causes an increase in net asset value per share. The historical calculation of total return in the table should not be considered a representation of the Company’s future total return, which may be greater or less than the return shown in the table due to a number of factors, including the Company’s ability or inability to make investments in companies that meet its investment criteria, the interest rate payable on the debt securities the Company acquires, the level of the Company’s expenses, variations in and the timing of the recognition of realized and unrealized gains or losses, the degree to which the Company encounters competition in its markets and general economic conditions. As a result of these factors, results for any previous period should not be relied upon as being indicative of performance in future periods. The total return calculations set forth above represent the total return on the Company’s investment portfolio during the applicable period and are calculated in accordance with GAAP. These return figures do not represent an actual return to stockholders.





24







|(6) | Portfolio turnover for the three months ended March 31, 2018 is not annualized.
|--- | -------------------------------------------------------------------------------



NOTE 9 – COMMITMENTS AND CONTINGENCIES



The Company enters into contracts that
contain a variety of indemnification provisions. The Company’s maximum exposure under these arrangements is unknown; however,
the Company has not had prior claims or losses pursuant to these contracts. Management has reviewed the Company’s existing
contracts and expects the risk of loss to the Company to be remote.



The Company is not currently subject to
any material legal proceedings and, to the Company’s knowledge, no material legal proceedings are threatened against the
Company. From time to time, the Company may be a party to certain legal proceedings in the ordinary course of business, including
proceedings relating to the enforcement of the Company’s rights under contracts with its portfolio companies. While the outcome
of these legal proceedings cannot be predicted with certainty, the Company does not expect that any such proceedings will have
a material effect upon its financial condition or results of operations.



NOTE 10 – SUBSEQUENT EVENTS



Management has evaluated all known subsequent
events through the date the accompanying financial statements were available to be issued on May 15, 2018, and notes the following:



For the period beginning April 1, 2018
and ending May 15, 2018, the Company sold 25,278.69 shares of its common stock for total gross proceeds of $333,854, and issued
amounts pursuant to its distribution reinvestment plan in the amount of $28,459.



On March 23, 2018, an amendment to Section
61(a) of the Company Act was signed into law to permit BDCs to reduce the minimum “asset coverage” ratio from 200%
to 150%, so long as certain approval and disclosure requirements are satisfied. In addition, for BDCs like the Company whose securities
are not listed on a national securities exchange, the Company is also required to offer to repurchase its outstanding shares at
the rate of 25% per quarter over four calendar quarters. Under the existing 200% minimum asset coverage ratio, the Company is permitted
to borrow up to one dollar for investment purposes for every one dollar of investor equity, and under the 150% minimum asset coverage
ratio, the Company will be permitted to borrow up to two dollars for investment purposes for every one dollar of investor equity.
In other words, Section 61(a) of the Company Act, as amended, permits BDCs to potentially increase their debt-to-equity ratio from
a maximum of 1 to 1 to a maximum of 2 to 1.



On April 18, 2018, the Board of Directors
of the Company, including a “required majority” (as such term is defined in Section 57(o) of the Company Act), approved
the application to the Company of the 150% minimum asset coverage ratio set forth in Section 61(a)(2) of the Company Act. As a
result, and subject to certain additional disclosure requirements, the minimum asset coverage ratio applicable to the Company will
be reduced from 200% to 150%, effective as of April 18, 2019. In addition, in order to provide the Company with the maximum financial
flexibility at the earliest possible date, the Board of Directors also authorized the submission of a proposal for stockholders
to approve the application of the 150% minimum asset coverage ratio to the Company at the Company’s 2018 annual meeting of
stockholders (the “2018 Annual Meeting”). If the Company’s stockholders approve such proposal at the 2018 Annual
Meeting, the 150% minimum asset coverage ratio will then apply effective as of June 21, 2018, the first day after the 2018 Annual
Meeting and, as a result, the Company will be permitted to incur double the maximum amount of leverage that the Company is able
to incur currently approximately ten months earlier than if the Company’s stockholders do not vote to approve such proposal.



25







|Item
    2: Management’s Discussion and Analysis of Financial Condition and Results of Operations.
|--------------------------------------------------------------------------------------------------



The following discussion
and analysis should be read in conjunction with our financial statements and related notes and other financial information appearing
elsewhere in this quarterly report on Form 10-Q.



Except as otherwise
specified, references to “we,” “us,” “our,” or the “Company,” refer to Triton Pacific
Investment Corporation, Inc.



Forward-Looking Statements



Some of the statements
in this quarterly report on Form 10-Q constitute forward-looking statements, which relate to future events or our performance or
financial condition. The forward-looking statements contained in this quarterly report on Form 10-Q involve risks and uncertainties,
including, but not limited to, statements as to:



| | ● | our
future operating results;
| | - | -----------------------------

| | ● | our
business prospects and the prospects of our portfolio companies;
| | - | --------------------------------------------------------------------

| | ● | changes
in the economy;
| | - | -----------------------

| | ● | risk
associated with possible disruptions in our operations or the economy generally;
| | - | -------------------------------------------------------------------------------------

| | ● | the
effect of investments that we expect to make;
| | - | -------------------------------------------------

| | ● | our
contractual arrangements and relationships with third parties;
| | - | ------------------------------------------------------------------

| | ● | actual
and potential conflicts of interest with Triton Pacific Adviser, LLC and its affiliates;
| | - | -----------------------------------------------------------------------------------------------

| | ● | the
dependence of our future success on the general economy and its effect on the industries in which we invest;
| | - | ----------------------------------------------------------------------------------------------------------------

| | ● | the
ability of our portfolio companies to achieve their objectives;
| | - | -------------------------------------------------------------------

| | ● | the
use of borrowed money to finance a portion of our investments;
| | - | ------------------------------------------------------------------

| | ● | the
adequacy of our financing sources and working capital;
| | - | ----------------------------------------------------------

| | ● | the
timing of cash flows, if any, from the operations of our portfolio companies;
| | - | ---------------------------------------------------------------------------------

| | ● | the
ability of Triton Pacific Adviser, LLC and its Sub-Adviser to locate suitable investments for us and to monitor and administer
our investments;
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------

| | ● | the
ability of Triton Pacific Adviser, LLC, its Sub-Adviser and its affiliates to attract and retain highly talented professionals;
| | - | -----------------------------------------------------------------------------------------------------------------------------------

| | ● | our
ability to qualify and maintain our qualification as a RIC and as a BDC; and
| | - | --------------------------------------------------------------------------------

| | ● | the
effect of changes in laws or regulations affecting our operations or to tax legislation and our tax position.
| | - | -----------------------------------------------------------------------------------------------------------------



Such
forward-looking statements may include statements preceded by, followed by or that otherwise include the words
“trend,” “opportunity,” “pipeline,” “believe,” “comfortable,”
“expect,” “anticipate,” “current,” “intention,” “estimate,”
“position,” “assume,” “potential,” “outlook,” “continue,”
“remain,” “maintain,” “sustain,” “seek,” “achieve,” and similar
expressions, or future or conditional verbs such as “will,” “would,” “should,”
“could,” “may,” or similar expressions. The forward looking statements contained in this annual
report involve risks and uncertainties. Our actual results could differ materially from those implied or expressed in the
forward-looking statements for any reason, including the factors set forth as “Risk Factors” in this report and
in our last annual report filed on Form 10-K dated April 2, 2018, filed with the
Securities and Exchange Commission (the “SEC”) on the same day.



We have based the forward-looking
statements included in this report on information available to us on the date of this report, and we assume no obligation to update
any such forward-looking statements. Actual results could differ materially from those anticipated in our forward-looking statements,
and future results could differ materially from historical performance. Although we undertake no obligation to revise or update
any forward-looking statements, whether as a result of new information, future events or otherwise, shareholders are advised to
consult any additional disclosures that we may make directly to them or through reports that we have filed or in the future may
file with the SEC, including quarterly reports on Form 10-Q, annual reports on Form 10-K, and current reports on Form 8-K.





26







Overview



We are a publicly registered,
non-traded fund focused on private equity, structured as a business development company that primarily makes equity, structured
equity, and debt investments in small to mid-sized private U.S. companies.  Structured equity refers to derivative investment
products, including convertible notes and warrants, designed to facilitate highly customized risk-return objectives. Our private
equity investments will generally take the form of direct investments in common and preferred equity, as well as structured equity
investments such as convertible notes and warrants. We are an externally managed, closed-end, non-diversified management investment
company that has elected to be treated as a business development company under the Company Act. Triton Pacific Adviser, LLC (“Triton
Pacific Adviser”), which is a registered investment adviser under the Investment Advisers Act of 1940, as amended, (the “Advisers
Act”) serves as our investment adviser and TFA Associates, LLC serves as our administrator. Each of these companies is affiliated
with Triton Pacific Group, Inc., a private equity investment management firm, and its subsidiary, Triton Pacific Capital Partners,
LLC (“TPCP”), a private equity investment fund management company, each focused on debt and equity investments in small
to mid-sized private companies.



We primarily make debt
investments likely to generate current income and equity investments in small to mid-sized private U.S. companies either alone
or together with other private equity sponsors. Our investment objective is to generate current income and long-term capital appreciation.



Triton Pacific Adviser
is responsible for sourcing potential investments, conducting due diligence on prospective investments, analyzing investment opportunities,
structuring investments and monitoring our portfolio on an ongoing basis. In addition, we have elected and intend to annually qualify
to be treated, for U.S. federal income tax purposes, as a regulated investment company (“RIC”), under subchapter M
of the Internal Revenue Code of 1986, as amended (the “Code”).



Our investment objectives
are to maximize our investment portfolio’s total return by generating long-term capital appreciation from our private equity
investments and current income from our debt investments. We intend to make both our debt and private equity investments in small
to mid-sized private U.S. companies either alone or together with other private equity sponsors.



We are offering for
sale a maximum of $300,000,000 of our common stock. We commenced our initial continuous public
offering of shares through our initial registration statement (File No. 333-174873) that was declared effective by the SEC on September
4, 2012. Rule 415 promulgated under the Securities Act requires that a registration statement not be used for more than three years
from its effective date, subject to a 180-day grace period. On September 2, 2015, we filed a registration statement with the SEC
(File No. 333-206730) in order to continue our continuous public offering of shares for an additional three years or until all
of the shares registered herein are sold. The registration statement for our follow-on offering was declared effective by the SEC
on March 17, 2016 and our most-recent post-effective amendment to our registration was declared effective by the SEC on May 3,
2017.As of May 15, 2018, we have sold a total of 1,513,839.20 shares of common stock for gross proceeds of approximately
$22,181,038 including shares issued pursuant to our distribution reinvestment plan in the amount of $715,036, including the reduction
due to $604,017 in shares repurchased pursuant to the Company’s Repurchase Program, and 14,815 shares of common stock sold
to Triton Pacific Adviser in exchange for gross proceeds of $200,003.



Our investment objective
is to maximize our portfolio’s total return by generating current income from our debt investments and long-term capital appreciation
from our equity investments. We will seek to meet our investment objectives by:



-Focusing primarily on debt and
equity investments in small and mid-sized private U.S. companies, which we define as companies with annual revenue of from $10
million to $ 250 million at the time of investment;





27







-Leveraging the experience and
expertise of our Adviser, its Sub-Adviser and its affiliates in sourcing, evaluating and structuring transactions;



-Employing disciplined underwriting
policies and rigorous portfolio management;



-Developing our equity portfolio
through our Adviser’s Value Enhancement Program, more fully discussed below in “Investment Objectives and Policies
– Investment Process”; and



-Maintaining a well-balanced
portfolio.



We intend to be active
in both debt and equity investing. We will seek to provide current income to our investors through our debt investments while seeking
to enhance our investors’ overall returns through long term capital appreciation of our equity investments. We intend to
be opportunistic in our investment approach, allocating our investments between debt and equity, depending on:



-Investment opportunities



-Market conditions



-Perceived Risk



Depending on the amount
of capital we raise in the Offering and subject to subsequent changes in our capital base, we expect that our investments will
generally range between $250,000 and $25 million per portfolio company, although this range may change in the discretion of our
Adviser, subject to oversight by our board of directors. Prior to raising sufficient capital to finance investments in this range
and as a strategy to manage excess cash, we may make smaller and differing types of investments in, for example, high quality debt
securities, and other public and private yield-oriented debt and equity securities, directly and through our Sub-Adviser.



Our Adviser has engaged
ZAIS to act as our investment sub-adviser. ZAIS assists our Adviser with identifying, evaluating, negotiating and structuring syndicated
debt investments and makes investment recommendations for approval by our Adviser. ZAIS is a Delaware limited liability company
and is a registered investment adviser under the Advisers Act and had approximately $4.51 billion in assets under management as
of March 31, 2018. ZAIS is not an affiliate of us or our Adviser and does not own any of our shares.



We will generally source
our private equity investments through third party intermediaries and our debt investments primarily through our Adviser and Sub-Adviser.
We will invest only after we conduct a thorough evaluation of the risks and strategic opportunities of an investment and a price
(or interest rate in the case of debt investments) has been established that reflects the intrinsic value of the investment opportunity.
We will endeavor to identify the best exit strategy for each private equity investment, including methodology (for example, a sale,
company redemption, or public offering) and an appropriate time horizon. We will then attempt to influence the growth and development
of each portfolio company accordingly to maximize our potential return on investment using such exit strategy or another strategy
that may become preferable due to changing market conditions. We anticipate that the holding period for most of our private equity
investments will range from four to six years, but we will be flexible in order to take advantage of market opportunities or to
overcome unfavorable market conditions.



We intend to generate
the majority of our current income by investing in senior secured loans, second lien secured loans and, to a lesser extent, subordinated
loans of small to mid-sized private U.S. companies. We may purchase interests in loans through secondary market transactions in
the “over-the-counter” market for institutional loans or directly from our target companies as primary market investments.
In connection with our debt investments, we may on occasion receive equity interests such as warrants or options as additional
consideration. The senior secured and second lien secured loans in which we invest generally will have stated terms of three to
seven years and any subordinated investments that we make generally will have stated terms of up to ten years. However, there is
no limit on the maturity or duration of any security we may hold in our portfolio. The loans in which we intend to invest are often
rated by a nationally recognized ratings organization, and generally carry a rating below investment grade (rated lower than “Baa3”
by Moody’s Investors Service or lower than “BBB-” by Standard & Poor’s Corporation – also
known as “junk bonds”). However, we may also invest in non-rated debt securities.





28







As a BDC, we are subject
to certain regulatory restrictions in making our investments. For example, we generally will not be permitted to co-invest alongside
our Adviser, including TPCP and certain of its affiliates, unless we obtain an exemptive order from the SEC or the transaction
is otherwise permitted under existing regulatory guidance, such as syndicated transactions where price is the only negotiated term,
and approval from our independent directors. We have applied for an exemptive relief order for co-investments, though there is
no assurance that such exemptions will be granted, and in either instance, conflicts of interests with affiliates of our Adviser
might exist. Should such conflicts of interest arise, we and the Adviser have developed policies and procedures for dealing with
such conflicts which require the Adviser to (i) execute such transactions for all of the participating investment accounts, including
ours, on a fair and equitable basis, taking into account such factors as the relative amounts of capital available for new investments,
the then-current investment objectives and portfolio positions of each party, and any other factors deemed appropriate and (ii)
endeavor to obtain the advice of Adviser personnel not directly involved with the investment giving rise to the conflict as to
such appropriateness and other factors as well as the fairness to all parties of the investment and its terms. We intend to make
all of our investments in compliance with the Company Act and in a manner that will not jeopardize our status as a BDC or RIC.



As a BDC, we are permitted
under the Company Act to borrow funds to finance portfolio investments. To enhance our opportunity for gain, we intend to employ
leverage as market conditions permit, but, as required under the Company Act, in no event will our leverage exceed 50% of the value
of our assets. While we have not yet determined the amount of leverage we will use, we do not currently anticipate that we would
approach the 50% maximum level frequently or at all. The use of leverage, although it may increase returns, may also increase the
risk of loss to our investors, particularly if the level of our leverage is high and the value of our investments declines.



Revenues



We generate revenue
in the form of dividends, interest and capital gains on the debt securities and equity interests that we hold. In addition, we
may generate revenue from our portfolio companies in the form of commitment, origination, structuring or diligence fees, monitoring
fees, fees for providing managerial assistance and possibly consulting fees and performance-based fees. Any such fees will be recognized
as earned.



Expenses



Our primary operating
expenses will be the payment of advisory fees and other expenses under the proposed investment adviser agreement. The advisory
fees will compensate our Adviser for its work in identifying, evaluating, negotiating, executing, monitoring and servicing our
investments.



We will bear all other
expenses of our operations and transactions, including (without limitation) fees and expenses relating to:



| | ● | corporate and organizational expenses
relating to offerings of our common stock, subject to limitations included in the investment advisory and management services agreement;
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ● | the cost of calculating our net asset
value, including the cost of any third-party valuation services;
| | - | ------------------------------------------------------------------------------------------------------



| | ● | the cost of effecting sales and repurchase
of shares of our common stock and other securities;
| | - | ----------------------------------------------------------------------------------------------



| | ● | investment advisory fees;
| | - | -------------------------



| | ● | fees payable to third parties relating
to, or associated with, making investments and valuing investments, including fees and expenses associated with performing due
diligence reviews of prospective investments;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ● | transfer agent and custodial fees;
| | - | ----------------------------------





29







| | ● | fees and expenses associated with marketing
efforts;
| | - | ----------------------------------------------------



| | ● | federal and state registration fees;
| | - | ------------------------------------



| | ● | federal, state and local taxes;
| | - | -------------------------------



| | ● | independent directors’ fees and
expenses;
| | - | -----------------------------------------



| | ● | costs of proxy statements, stockholders’
reports and notices;
| | - | -------------------------------------------------------------



| | ● | fidelity bond, directors and officers/errors
and omissions liability insurance and other insurance premiums;
| | - | ------------------------------------------------------------------------------------------------------------



| | ● | direct costs such as printing, mailing,
long distance telephone, and staff;
| | - | ---------------------------------------------------------------------------



| | ● | fees and expenses associated with independent
audits and outside legal costs, including compliance with the Sarbanes-Oxley Act;
| | - | -------------------------------------------------------------------------------------------------------------------------------



| | ● | costs associated with our reporting and
compliance obligations under the Company Act and applicable federal and state securities laws;
| | - | --------------------------------------------------------------------------------------------------------------------------------------



| | ● | brokerage commissions for our investments;
| | - | ------------------------------------------



| | ● | legal, accounting and other costs associated
with structuring, negotiating, documenting and completing our investment transactions;
| | - | -----------------------------------------------------------------------------------------------------------------------------------



| | ● | all other expenses incurred by our Adviser,
in performing its obligations, subject to the limitations included in the investment adviser agreement; and
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------



| | ● | all other expenses incurred by either
our Administrator or us in connection with administering our business, including payments to our Administrator under the administration
agreement that will be based upon our allocable portion of its overhead and other expenses incurred in performing its obligations
under the administration agreement, including rent and our allocable portion of the costs of compensation and related expenses
of our chief executive officer, chief compliance officer and chief financial officer and their respective staffs.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Reimbursement of TFA Associates, LLC
for Administrative Services



We will reimburse TFA
Associates for the administrative expenses necessary for its performance of services to us. Such costs will be reasonably allocated
to us on the basis of assets, revenues, time records or other reasonable methods. However, such reimbursement is made in an amount
equal to the lower of the Administrator’s actual costs or the amount that we would be required to pay for comparable administrative
services in the same geographic location. We will not reimburse our Administrator for any services for which it receives a separate
fee or for rent, depreciation, utilities, capital equipment or other administrative items allocated to a controlling person of
TFA Associates.



Portfolio and Investment Activity



During the three months
ended March 31, 2018, we made investments in portfolio companies totaling $2,452,500. During the same period, we sold investments
and received principal repayments of $701,586. As of March 31, 2018, our investment portfolio, with a total fair value of $13,876,199,
consisted of interests in 36 portfolio companies (63.46% in first lien senior secured loans, 32.88% in second lien senior secured
loans, 0% in subordinated convertible debt and 3.66% in equity). The portfolio companies that comprised our portfolio as of such
date had an average annual EBITDA of approximately $167.9 million. As of March 31, 2018, the investments in our debt portfolio
were purchased at a weighted average price of 98.4% of par or stated value, and the weighted average credit rating of the investments
in our portfolio that were rated (constituting 96.3% of our portfolio based on the fair value of our investments) was B2 based
upon the Moody’s scale. Our estimated gross annual portfolio yield was 7.26% based upon the amortized cost of our investments
and was 7.90% on the debt portfolio alone. Our gross annual portfolio yield represents the expected yield to be generated by us
on our investment portfolio based on the composition of our portfolio as of March 31, 2018. The portfolio yield does not represent
an actual investment return to stockholders.





30







Total Portfolio Activity



The following tables present certain selected
information regarding our portfolio investment activity for the three months ended March 31, 2018 and year ended December 31, 2017:





|Net Investment Activity |  | Three
    months ended March 31, 2018 |           |   | Year
    ended December 31, 2017 |  
|----------------------- |  | ------------------------------------- | --------- | - | -------------------------------- | -
|Purchases               |  | $                                     | 2,452,500 |   |                                  | $
|Sales and Redemptions   |  |                                       | (701,586  | ) |                                  |  
|Net Portfolio Activity  |  | $                                     | 1,750,914 |   |                                  | $







The following tables summarize the composition
of our purchases for the three months ended March 31, 2018 and for the year ended December 31, 2017:





|                                 |  | Three
    months ended March 31, 2018 
(unaudited) |           |  | Year
    ended December 31, 2017 | 
|-------------------------------- |  | -------------------------------------------------- | --------- |  | -------------------------------- | 
|                                 |  | Purchases                                          |           |  | Percentage
     of  Portfolio    | 
|Senior Secured Loans—First Lien  |  | $                                                  | 1,465,000 |  |                                  | 
|Senior Secured Loans—Second Lien |  |                                                    | 987,500   |  |                                  | 
|Subordinated Debt                |  |                                                    | —         |  |                                  | 
|Equity/Other                     |  |                                                    | —         |  |                                  | 
|Total                            |  | $                                                  | 2,452,500 |  |                                  | 







| | (1) | Amortized cost represents the original cost adjusted for the amortization of premiums and/or accretion
of discounts, as applicable, on investments.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------





|                                                                         | March
    31, 2018 |  | December 31, 2017
|------------------------------------------------------------------------ | ------------------ |  | -----------------
|Number of Portfolio Companies                                            | 36                 |  | 32               
|% Variable Rate (based on fair value)                                    | 96.3%              |  | 95.5%            
|% Fixed Rate (based on fair value)                                       | 0.0%               |  | 0.0%             
|% Non-Income Producing Equity or Other Investments (based on fair value) | 3.7%               |  | 4.5%             
|Average Annual EBITDA of Portfolio Companies                             | 167.9MM            |  | 162.3MM          
|Weighted Average Credit Rating of Investments that were Rated            | B2                 |  | B2               
|% of Investments on Non-Accrual (based on amortized cost)                | —                  |  | —                
|Gross Portfolio Yield Prior to Leverage (based on amortized cost)        | 7.3%               |  | 6.7%             









31







The table below describes investments by
industry classification and enumerates the percentage, by fair value, of the total portfolio assets in such industries as of March
31, 2018 and December 31, 2017:





|                                  |  | March
    31, 2018 
(Unaudited) |            |  | December
    31, 2017       | 
|--------------------------------- |  | ------------------------------- | ---------- |  | --------------------------- | 
|Industry
    Classification       |  | Fair
    Value                  |            |  | Percentage of
    Portfolio | 
|Beverage, Food & Tobacco          |  |                                 | 2,138,294  |  |                             | 
|Business Services                 |  |                                 | 4,868,879  |  |                             | 
|Consumer Services                 |  |                                 | 1,634,316  |  |                             | 
|Energy: Oil & Gas                 |  |                                 | 333,047    |  |                             | 
|Environmental                     |  |                                 | 488,750    |  |                             | 
|Healthcare & Pharmaceuticals      |  |                                 | 1,204,990  |  |                             | 
|High Tech Industries              |  |                                 | 829,175    |  |                             | 
|Hotel, Gaming & Leisure           |  |                                 | 351,565    |  |                             | 
|Media: Diversified and Production |  |                                 | 335,299    |  |                             | 
|Metals & Mining                   |  |                                 | 1,003,750  |  |                             | 
|Telecommunications                |  |                                 | 489,595    |  |                             | 
|Wholesale Trade-Nondurable Goods  |  |                                 | 198,539    |  |                             | 
|Total                             |  | $                               | 13,876,199 |  |                             | 







We do not “control” any of
our portfolio companies, each as defined in the Company Act. We are an affiliate of two portfolio companies, Javlin Capital, LLC
(held through TPJ Holdings, Inc. and a convertible note) and Injured Workers Pharmacy, LLC (held through ACON IWP Investors I,
L.L.C.). In general, under the Company Act, we would be presumed to “control” a portfolio company if we owned 25% or
more of its voting securities and would be an “affiliate” of a portfolio company if we owned 5% or more of its voting
securities.



Portfolio Asset Quality



In addition to various
risk management and monitoring tools, our Subadviser uses an investment rating system to characterize and monitor the expected
level of returns on each investment in our debt portfolio. All of the investments included in our Subadviser’s rating systems
refer to non-rated debt securities or rated debt securities that carry a rating below investment grade (rated lower than “Baa3”
by Moody’s Investors Service or lower than “BBB-” by Standard & Poor’s Corporation also known
as “junk bonds”).  These ratings are on a scale of 1 to 8 as follows:





| | 1. | Highest quality obligors, minimal medium term default risk; possibly moving towards investment
grade status.
| | -- | ------------------------------------------------------------------------------------------------------------



| | 2. | High quality obligors, but not likely to move towards investment grade in the medium term; performing
at or in excess of expected levels; solid liquidity; conservative credit statistics.
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 3. | Credits of with a history of performing with leverage (repeat issuers); moderate credit statistics
currently performing at or in excess of expected levels; solid liquidity; no expectation of covenant defaults or third party ratings
downgrades.
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 4. | Credits new to the leveraged loan universe; currently performing within a range of expected performance;
moderate to aggressive credit statistics.
| | -- | --------------------------------------------------------------------------------------------------------------------------------------------------



| | 5. | Credits new to the leveraged loan universe; currently performing within a range of expected performance;
aggressive credit statistics or weak industry characteristics.
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 6. | Credits placed in this category are experiencing potential liquidity problems but the issues are
not imminent (more than 12 months).
| | -- | ------------------------------------------------------------------------------------------------------------------------------------



| | 7. | Credits placed in this category are experiencing nearer-term liquidity problems (within 12 months).
| | -- | ---------------------------------------------------------------------------------------------------



| | 8. | Credits placed in this category have experienced either a technical or actual payment default which
may require a write-down within our respective portfolios.
| | -- | --------------------------------------------------------------------------------------------------------------------------------------------------------------





Categories 1 through 5 are performing
in line with expectation, while categories 6-8 are closely watched for or have experienced liquidity problems and/or default.





32







The following table shows the
distribution of our non-affiliate investments on the 1 to 8 scale at fair value as of March 31, 2018 and December 31, 2017:







|                      |  |  | March
    31, 2018 |            |  | December 31,
    2017 | 
|--------------------- |  |  | ------------------ | ---------- |  | --------------------- | 
|Investment
    Rating |  |  | Fair
    Value     |            |  | Percentage            | 
|1                     |  |  | $                  | 286,706    |  |                       | 
|2                     |  |  |                    | 495,000    |  |                       | 
|3                     |  |  |                    | 2,766,403  |  |                       | 
|4                     |  |  |                    | 4,124,306  |  |                       | 
|5                     |  |  |                    | 5,026,346  |  |                       | 
|6                     |  |  |                    | 669,790    |  |                       | 
|7                     |  |  |                    | —          |  |                       | 
|8                     |  |  |                    | —          |  |                       | 
|                      |  |  | $                  | 13,368,551 |  |                       | 







Results of Operations



Investment Income



For the three months
ended March 31, 2018 and 2017, we generated $255,674 and $183,548, respectively, in investment income in the form of interest and
fees earned on our debt portfolio. Such revenues represent $248,102 of cash income and $7,572 in non-cash portions related to the
accretion of discounts and paid-in-kind interest for the three months ended March 31, 2018. We expect the dollar amount of interest
that we earn to continue to increase as the size of our investment portfolio increases.



Operating Expenses



Total operating expenses
before reimbursement from the sponsor totaled $283,373 and $252,107 for the three months ended March 31, 2018 and 2017, respectively,
and consisted of base management fees, adviser and administrator reimbursements, professional fees, insurance expense, directors’
fees and other general and administrative fees. The base management fees for the quarters were $88,296 and $79,902, respectively,
and the incentive fees for the quarters were $0 and $18,439, respectively. Pursuant to the Expense Reimbursement Agreement (discussed
below), the sponsor reimbursed the Company $0 and $80,847 for the three months ended March 31, 2018 and 2017.



Our other general and
administrative expenses totaled $6,828 and $5,396 for the three months ended March 31, 2018 and 2017, respectively, and consisted
of the following:





|                     |  | Three
    months ended March 31, 2018 |       |  | Three
    months ended March 31, 2017 |  
|-------------------- |  | ------------------------------------- | ----- |  | ------------------------------------- | -
|Licenses and permits |  | $                                     | 623   |  |                                       | $
|Printing fees        |  |                                       | 940   |  |                                       |  
|Travel expenses      |  |                                       | 4,713 |  |                                       |  
|Other                |  |                                       | 552   |  |                                       |  
|Total                |  | $                                     | 6,828 |  |                                       | $











Net Investment Income



Our net investment
income totaled $(27,699) and $12,288 $(0.02) and $0.01 per share based on weighted average shares outstanding) for the three months
ended March 31, 2018 and 2017, respectively.





33







Net Realized Gains/Losses from Investments



We measure realized
gains or losses by the difference between the net proceeds from the disposition and the amortized cost basis of investment, without
regard to unrealized gains or losses previously recognized.



For the three months
ended March 31, 2018, we received principal payments of $701,586, from which we realized a net gain of $22,650. For the three months
ended March 31, 2017, we received principal payments of $438,557, from which we realized a net gain of $12,615.



Net Unrealized Appreciation/Depreciation
on Investments



Net change in unrealized
appreciation on investments reflects the net change in the fair value of our investment portfolio. For the three months ended March
31, 2018 and 2017, net unrealized appreciation totaled $59,525 and $92,194, respectively.



Changes in Net Assets from Operations



For the three months
ended March 31, 2018, we recorded a net income of $54,476 compared to net income of $117,097 for the three months ended March 31,
2017.



Based on 1,445,936
weighted average common shares outstanding for the three months ended March 31, 2018, basic and diluted, our per share net increase
in net assets resulting from operations was $0.04.



Based on 1,016,727
weighted average common shares outstanding for the three months ended March 31, 2017, basic and diluted, our per share net increase
in net assets resulting from operations was $0.12.



Financial Condition, Liquidity and Capital
Resources



We generate cash primarily
from the net proceeds of our offering, and from cash flows from fees (such as management fees), interest and dividends earned from
our investments and principal repayments and proceeds from sales of our investments. Our primary use of funds is investments in
companies, and payments of our expenses and distributions to holders of our common stock.



The offering of our
common stock represents a continuous offering of our shares. The initial offering of our common stock commenced on September 4,
2012 and terminated on March 1, 2016. On March 17, 2016, we commenced the follow-on offering of our common stock, which follow-on
offering is currently ongoing. We intend to file post-effective amendments to our registration statement to allow us to continue
our offering for three years. Our most recent post-effective amendment was filed with the SEC on April 5, 2018 and has not yet
been declared effective. The Dealer Manager is not required to sell any specific number or dollar amount of shares but will use
its best efforts to sell the shares offered. The minimum investment in shares of our common stock is $5,000.



The current offering
price for our shares is $13.16 per share; however, to the extent our net asset value increases, we will sell at a price necessary
to ensure that shares are not sold at a price per share, after deduction of selling commissions and dealer manager fees, that is
below our net asset value per share. In connection with each closing, our board of directors or a committee thereof is required,
within 48 hours of the time that each closing and sale is made, to make the determination that we are not selling shares of any
class of our common stock at a price per share which, after deducting upfront selling commissions, if any, is below the then-current
net asset value per share of the applicable class. Promptly following any such adjustment to the offering price per share, we will
file a prospectus supplement with the SEC disclosing the adjusted offering price, and we appropriately publish the updated information.
The Dealer Manager for this offering is an affiliate of our Adviser.



During the three months
ended March 31, 2018, we sold 68,506.32 shares of our common stock for gross proceeds of $918,640 at an average price per share
of $13.41. The increase in capital in excess of par during the three months ended March 31, 2018 include reinvested stockholder
distributions of $82,533 for which we issued 6,815.35 shares of common stock. The sales commissions and dealer manager fees related
to the sale of our common stock were $88,784 for the three months ended March 31, 2018. These sales commissions and fees include
$17,320 retained by the dealer manager, Triton Pacific Securities, LLC, which is an affiliate of ours. Our
offering expenses are capitalized as deferred offering expenses and then subsequently expensed over a 12-month period.





34







We may borrow funds
to make investments at any time, including before we have fully invested the proceeds of our offering, to the extent we determine
that additional capital would allow us to take advantage of investment opportunities, or if our board of directors determines that
leveraging our portfolio would be in our best interests and the best interests of our stockholders. We have not yet decided, however,
whether, and to what extent, we will finance portfolio investments using debt. We do not currently anticipate issuing any preferred
stock.



Contractual Obligations



We have entered into
certain contracts under which we have material future commitments. On July 27, 2012, we entered into the investment advisory agreement
with Triton Pacific Adviser, LLC in accordance with the Company Act. The investment advisory agreement became effective on June
25, 2014, the date that we met the minimum offering requirement. Triton Pacific Adviser serves as our investment advisor in accordance
with the terms of our investment advisory agreement. Payments under our investment advisory agreement in each reporting period
will consist of (i) a management fee equal to a percentage of the value of our gross assets and (ii) a capital gains incentive
fee based on our performance.



On July 27, 2012, we
entered into the administration agreement with TFA Associates, LLC pursuant to which TFA Associates furnishes us with administrative
services necessary to conduct our day-to-day operations. TFA Associates is reimbursed for administrative expenses it incurs on
our behalf in performing its obligations. Such costs are reasonably allocated to us on the basis of assets, revenues, time records
or other reasonable methods. We do not reimburse TFA Associates for any services for which it receives a separate fee or for rent,
depreciation, utilities, capital equipment or other administrative items allocated to a controlling person of TFA Associates.



At the time of our
offering, our Administrator has contracted with Bank of New York Mellon and affiliated entities to provide additional administrative
services, while we have directly engaged Bank of New York Mellon and affiliated entities to act as our custodian. We have also
contracted with Phoenix American Financial Services to act as our transfer agent, plan administrator, distribution paying agent
and registrar. In April, 2018, our Administrator contracted with SS&C Technologies, Inc. to provide additional accounting services.



If any of our contractual
obligations discussed above are terminated, our costs may increase under any new agreements that we enter into as replacements.
We would also likely incur expenses in locating alternative parties to provide the services we expect to receive under the investment
advisory agreement and administration agreement. Any new investment advisory agreement would also be subject to approval by our
stockholders.



Off-Balance Sheet Arrangements



Other than contractual
commitments and other legal contingencies incurred in the normal course of our business, we do not have any off-balance sheet financings
or liabilities.



Distributions



We elected to be treated,
beginning with our fiscal year ending December 31, 2012, and intend to qualify annually thereafter, as a RIC under the Code. To
obtain and maintain RIC tax treatment, we must, among other things, distribute at least 90% of our net ordinary income and net
short-term capital gains in excess of net long-term capital losses, if any, to our stockholders. In order to avoid certain excise
taxes imposed on RICs, we must distribute during each calendar year an amount at least equal to the sum of: (i) 98% of our ordinary
income for the calendar year, (ii) 98.2% of our capital gains in excess of capital losses for the one-year period generally ending
on October 31 of the calendar year (unless an election is made by us to use our taxable year) and (iii) any ordinary income and
net capital gains for preceding years that were not distributed during such years and on which we paid no federal income tax.





35







While we intend to
distribute any income and capital gains in the manner necessary to minimize imposition of the 4% U.S. federal excise tax, sufficient
amounts of our taxable income and capital gains may not be distributed to avoid entirely the imposition of the tax. In that event,
we will be liable for the tax only on the amount by which we do not meet the foregoing distribution requirement.



Our board of directors
has authorized, and has declared, cash distributions on our common stock on a monthly basis since the second quarter of 2015. The
amount of each such distributions is subject to our board of directors’ discretion and applicable legal restrictions related
to the payment of distributions. We calculate each stockholder’s specific distribution amount for the month using record
and declaration dates, and distributions will begin to accrue on the date we accept subscriptions for shares of our common stock.
From time to time, we may also pay interim distributions at the discretion of our board. Each year a statement on Internal Revenue
Service Form 1099-DIV (or any successor form) identifying the source of the distribution (i.e., paid from ordinary income, paid
from net capital gain on the sale of securities, and/or a return of paid-in capital surplus which is a nontaxable distribution)
will be mailed to our stockholders. Our distributions may exceed our earnings, especially during the period before we have substantially
invested the proceeds from our offering. As a result, a portion of the distributions we make may represent a return of capital
for tax purposes.



We have adopted an
“opt in” distribution reinvestment plan for our common stockholders. As a result, when we make a distribution, stockholders
will receive distributions in cash unless they specifically “opt in” to the distribution reinvestment plan so as to
have their cash distributions reinvested in additional shares of our common stock. Any distributions reinvested under the plan
will nevertheless remain taxable to U.S. stockholders.





36







The following table reflects the cash distributions
per share that we have declared and paid on our common stock through March 31, 2018:





|                               |  |  | Distribution |        
|------------------------------ |  |  | ------------ | -------
|For the Three
    Months Ended |  |  | Per Share    |        
|Fiscal 2018                    |  |  |              |        
|January 29, 2018               |  |  | $            | 0.03370
|February 28, 2018              |  |  | $            | 0.03370
|March 28, 2018                 |  |  | $            | 0.03370
|                               |  |  |              |        
|Fiscal 2017                    |  |  |              |        
|January 27, 2017               |  |  | $            | 0.04000
|February 24, 2017              |  |  | $            | 0.04000
|March 23, 2017                 |  |  | $            | 0.04000
|April 27, 2017                 |  |  | $            | 0.04000
|May 25, 2017                   |  |  | $            | 0.04000
|June 23, 2017                  |  |  | $            | 0.04000
|July 21, 2017                  |  |  | $            | 0.04000
|August 29, 2017                |  |  | $            | 0.03417
|September 28, 2017             |  |  | $            | 0.03417
|October 26, 2017               |  |  | $            | 0.03417
|November 27, 2017              |  |  | $            | 0.03370
|December 26, 2017              |  |  | $            | 0.03370
|                               |  |  |              |        
|Fiscal 2016                    |  |  |              |        
|January 22, 2016               |  |  | $            | 0.04500
|February 16, 2016              |  |  | $            | 0.04500
|March 23, 2016                 |  |  | $            | 0.04500
|April 21, 2016                 |  |  | $            | 0.04500
|May 19, 2016                   |  |  | $            | 0.04500
|June 23, 2016                  |  |  | $            | 0.04500
|July 21, 2016                  |  |  | $            | 0.04000
|August 25, 2016                |  |  | $            | 0.04000
|September 22, 2016             |  |  | $            | 0.04000
|October 20, 2016               |  |  | $            | 0.04000
|November 18, 2016              |  |  | $            | 0.04000
|December 20, 2016              |  |  | $            | 0.04000











Our distributions previously
were paid quarterly in arrears.  On January 15, 2015, our Board declared a quarterly cash distribution for the fourth
quarter of 2014 of $0.07545 per share payable on January 30, 2015, to shareholders of record as of January 20, 2015. In addition,
on April 2, 2015, our Board declared a cash distribution for the first quarter of 2015 of $0.116 per share payable on April 13,
2015, to shareholders of record as of April 6, 2015. Commencing in April 2015, and subject to our board of directors’
discretion and applicable legal restrictions, our board of directors began to authorize and declare a monthly distribution amount
per share of our common stock, payable in advance.  We then calculate each stockholder’s specific distribution
amount for the month using record and declaration dates, and distributions will begin to accrue on the date we accept subscriptions
for shares of our common stock.  No distributions were declared for the years before 2015.



The Company may fund
its cash distributions to stockholders from any sources of funds legally available to it, including offering proceeds, borrowings,
net investment income from operations, capital gains proceeds from the sale of assets, non-capital gains proceeds from the sale
of assets, dividends or other distributions paid to the Company on account of preferred and common equity investments in portfolio
companies and expense reimbursements from the Adviser. The Company has not established limits on the amount of funds it may use
from available sources to make distributions.





37







The following table
reflects the sources of the cash distributions on a tax basis that the Company paid on its common stock during the three months
ended March 31, 2018 and March 31, 2017:





|                                                          |  | Three months ended March 31, |        
|--------------------------------------------------------- |  | ---------------------------- | -------
|                                                          |  | 2018                         |        
|Source
    of Distribution                                |  | Distribution
    Amount      |        
|Offering proceeds                                         |  | $                            | —      
|Borrowings                                                |  |                              | —      
|Net investment income(1)                                  |  |                              | —      
|Short-term capital gains proceeds from the sale of assets |  |                              | 13,000 
|Long-term capital gains proceeds from the sale of assets  |  |                              | 47,908 
|Distributions from common equity (return of capital)      |  |                              | 85,819 
|Expense reimbursement from sponsor                        |  |                              | —      
|Total                                                     |  | $                            | 146,727
















| | (1) | During the three months ended March 31, 2018 and 2017, 97.0% and 90.3%, respectively, of the Company’s gross investment
income was attributable to cash income earned, and 3.0% and 9.7%, resepctively was attributable to non-cash accretion of discount
and paid in-kind interest.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------







Related Party Transactions



We have entered into
an investment and advisory agreement with Triton Pacific Adviser in which our senior management holds equity interest. Members
of our senior management also serve as principals of other investment managers affiliated with Triton Pacific Adviser that do and
may in the future manage investment funds, accounts or other investment vehicles with investment objectives similar to ours.



We have entered into
an administration agreement with TFA Associates in which our senior management holds equity interest and act as principals.



We have entered into
a dealer manager agreement with Triton Pacific Securities, LLC and pay them a fee of up to 10% of gross proceeds raised in the
offering, some of which will be re-allowed to other participating broker-dealers. Triton Pacific Securities, LLC is an affiliated
entity of Triton Pacific Adviser.



We have entered into
a license agreement with Triton Pacific Group, Inc. under which Triton Pacific Group, Inc. has granted us a non-exclusive, royalty-free
license to use the name “Triton Pacific” for specified purposes in our business. Under this agreement, we have the
right to use the “Triton Pacific” name, subject to certain conditions, for so long as Triton Pacific Adviser or one
of its affiliates remains our investment advisor. Other than with respect to this limited license, we have no legal right to the
“Triton Pacific” name.



We have entered into
an expense support and conditional reimbursement agreement with Triton Pacific Adviser pursuant to which the Adviser will pay up
to 100% of the Company’s organization, offering and operating expenses, subject to repayment by us to the Adviser, in order
for the Company to achieve a reasonable level of expenses relative to its investment income, as determined by the Company and the
Adviser. our Adviser has agreed to make advances to us to cover certain of our operating expenses. (See “Expense Reimbursement
Agreement”, below.)



Management Fee



Pursuant to the investment
adviser agreement, we pay our Adviser a fee for investment advisory and management services consisting of a base management fee
and an incentive fee.





38







The base management
fee is calculated at a quarterly rate of 0.5% of our average gross assets (including amounts borrowed for investment purposes)
and payable quarterly in arrears. For the first quarter of our operations, the base management fee was calculated based on the
initial value of our gross assets. Subsequently, the base management fee for any calendar quarter is calculated based on the average
value of our gross assets at the end of that and the immediately preceding quarters, appropriately adjusted for any share issuances
or repurchases during that quarter. The base management fee may or may not be taken in whole or in part at the discretion of our
Adviser. All or any part of the base management fee not taken as to any quarter shall be accrued without interest and may be taken
in such other quarter as our Adviser shall determine. The base management fee for any partial quarter will be appropriately pro-rated.



Though, in accordance
with the Advisers Act, the Adviser could have received an incentive fee on both current income earned and income from capital gains,
the Adviser has agreed to waive any incentive fees from current income. As such, the Adviser will be paid an incentive fee only
upon the realization of a capital gain from the sale of an investment. The incentive fee will be calculated and payable quarterly
in arrears or as of the date of our liquidation or the termination of the investment adviser agreement, and will equal 20% of our
realized capital gains on a cumulative basis from inception through the end of each quarter, computed net of all realized capital
losses and unrealized capital depreciation on a cumulative basis, less the aggregate amount of any previously paid capital gain
incentive fees.



For purposes of the
foregoing: (1) the calculation of the incentive fee shall include any capital gains that result from cash distributions that are
treated as a return of capital, (2) any such return of capital will be treated as a decrease in our cost basis for the relevant
investment and (3) all fiscal year-end valuations will be determined by us in accordance with GAAP, applicable provisions of the
Company Act and our pricing procedures. In determining the incentive fee payable to our Adviser, we will calculate the aggregate
realized capital gains, aggregate realized capital losses and aggregate unrealized capital depreciation, as applicable, with respect
to each of the investments in our portfolio. For this purpose, aggregate realized capital gains, if any, will equal the sum of
the positive differences between the net sales prices of our investments, when sold, and the cost of such investments since inception.
Aggregate realized capital losses will equal the sum of the amounts by which the net sales prices of our investments, when sold,
is less than the original cost of such investments since inception. Aggregate unrealized capital depreciation will equal the sum
of the difference, if negative, between the valuation of each investment as of the applicable date and the original cost of such
investment. At the end of the applicable period, the amount of capital gains that serves as the basis for our calculation of the
capital gains incentive fee will equal the aggregate realized capital gains less aggregate realized capital losses and less aggregate
unrealized capital depreciation with respect to our portfolio investments. If this number is positive at the end of such period,
then the incentive fee for such period will be equal to 20% of such amount, less the aggregate amount of any incentive fees paid
in all prior periods.



While the investment
advisory agreement neither includes nor contemplates the inclusion of unrealized gains in the calculation of the capital gains
incentive fee, pursuant to an interpretation of an American Institute of Certified Public Accountants, or AICPA, Technical Practice
Aid for investment companies, we include unrealized gains in the calculation of the capital gains incentive fee expense and related
accrued capital gains incentive fee. This accrual reflects the incentive fees that would be payable to our Advisor as if our entire
portfolio was liquidated at its fair value as of the balance sheet date even though our Adviser is not entitled to an incentive
fee with respect to unrealized gains unless and until such gains are actually realized.



The organizational
and offering expense and other expense reimbursements may include a portion of costs incurred by our Adviser or its members or
affiliates on our behalf for legal, accounting, printing and other offering expenses, including for marketing, salaries and direct
expenses of its employees, employees of its affiliates and others while engaged in registering and marketing the shares of our
common stock, which shall include development of marketing and marketing presentations and training and educational meetings and
generally coordinating the marketing process for us and may also include amounts reimbursed by us to our Dealer Manager for actual
bona fide due diligence expenses incurred by our Dealer Manager or participating broker-dealers in an aggregate amount that is
reasonable in relation to the gross proceeds raised in our offering and which are supported by detailed, itemized invoices. None
of the reimbursements referred to above will exceed actual expenses incurred by our Adviser, its members or affiliates. Our Adviser
will reimburse to us, without recourse or reimbursement by us, any organizational and offering expenses to the extent those expenses,
when aggregated with sales load, exceed 15.0%.





39







Expense Reimbursement Agreement



On March 27, 2014,
we and our Adviser agreed to the Expense Reimbursement Agreement. The Expense Reimbursement Agreement was amended and restated
effective April 5, 2018. Under the Expense Reimbursement Agreement, as amended, our Adviser, in consultation with the Company,
may pay up to 100% of both our organizational and offering expenses and our operating expenses, all as determined by us and our
Adviser. As used in the Expense Reimbursement Agreement, operating expenses refer to third party operating costs and expenses incurred
by us, as determined under generally accepted accounting principles for investment management companies. Organizational and offering
expenses include expenses incurred in connection with the organization of our company and expenses incurred in connection with
our offering, which are recorded as a component of equity. The Expense Reimbursement Agreement states that until the net proceeds
to us from our offering are at least $25 million, our Adviser may pay up to 100% of both our organizational and offering expenses
and our operating expenses. After we received at least $25 million in net proceeds from our offering, our Adviser may, with our
consent, continue to make expense support payments to us in such amounts as are acceptable to us and our Adviser. Any expense support
payments shall be paid by the Adviser to the Company in any combination of cash, and/or offsets against amounts otherwise due from
the Company to the Adviser.



Under the Expense Reimbursement
Agreement as amended, once we have received at least $25 million in net proceeds from our offering,we are required to reimburse our Adviser for any expense support payments we received from them occurring
within three years of the date on which we incurred such expenses However, with respect to any expense support payments
attributable to our operating expenses,(i) we will only reimburse our Adviser for expense
support payments made by our Adviser to the extent that the payment of such reimbursement (together with any other reimbursement
paid during such fiscal year) does not cause “other operating expenses” (as defined below) (on an annualized basis
and net of any expense reimbursement payments received by us during such fiscal year) to exceed the percentage of our average net
assets attributable to shares of our common stock represented by “other operating expenses” during the fiscal year
in which such expense support payment from our Adviser was made (provided, however, that this clause (i) shall not apply to
any reimbursement payment which relates to an expense support payment from our Adviser made during the same fiscal year); and (ii) we
will not reimburse our Adviser for expense support payments made by our Adviser if the annualized rate of regular cash distributions
declared by us at the time of such reimbursement payment is less than the annualized rate of regular cash distributions declared
by us at the time our Adviser made the expense support payment to which such reimbursement relates. “Other operating expenses”
means our total operating expenses excluding base management fees, incentive fees, organization and offering expenses, financing
fees and costs, interest expense, brokerage commissions and extraordinary expenses.



In
addition, with respectto any expense support payment attributable to our organizational and offering expenses, we
will only reimburse our Adviser for expense support payments made by our Adviser to the extent that the payment of such reimbursement
(together with any other reimbursement for organizational and offering expenses paid during such fiscal year) is limited to 15%
of cumulative gross sales proceeds including the sales load (or dealer manager fee) paid by us.



Under the Expense Reimbursement
Agreement, any unreimbursed expense support payments may be reimbursed by us within a period not to exceed three years from the
end of the quarter in which we incurred the expense.



We or our Adviser may
terminate the expense reimbursement agreement at any time upon thirty days’ written notice. The expense reimbursement agreement
will automatically terminate upon termination of the Investment Advisory Agreement or upon our liquidation or dissolution. The
expense reimbursement agreement expires by its terms on December 31, 2018, unless extended with the mutual consent of us and our
Adviser. Upon termination of the Expense Support Agreement we may be required to repay our Adviser all expense support payments
made by our Adviser within three years of the date of termination, subject to the limitations contained in the agreement.





40







The
Expense Reimbursement Agreement is, by its terms, effective retroactively to our inception date of April 29, 2011. As a result,
our Adviser has agreed to reimburse a total of $5,292,191 as of March 31, 2018.



Below
is a table that provides information regarding expense support payments incurred by our Adviser pursuant to the Expense Support
Agreement as well as other information relating to our ability to reimburse our Adviser for such payments:





|Quarter
    Ended  |  | Amount
    of Expense Payment Obligation |  | Amount
    of Offering Cost Payment Obligation |  | Operating
    Expense Ratio as of the Date Expense Payment Obligation Incurred(1) |  | Annualized
    Distribution Rate as of the Date Expense Payment Obligation Incurred(2) |  | Eligible
    for Reimbursement Through
|------------------ |  | ---------------------------------------- |  | ---------------------------------------------- |  | --------------------------------------------------------------------------------- |  | -------------------------------------------------------------------------------------- |  | --------------------------------------
|September 30, 2012 |  | $21,826                                  |  | $0                                             |  | 432.69%                                                                           |  | —                                                                                      |  | September 30, 2015                    
|December 31, 2012  |  | $26,111                                  |  | $0                                             |  | 531.09%                                                                           |  | —                                                                                      |  | December 31, 2015                     
|March 31, 2013     |  | $30,819                                  |  | $0                                             |  | N/A                                                                               |  | —                                                                                      |  | March 31, 2016                        
|June 30, 2013      |  | $59,062                                  |  | $0                                             |  | N/A                                                                               |  | —                                                                                      |  | June 30, 2016                         
|September 30, 2013 |  | $65,161                                  |  | $0                                             |  | N/A                                                                               |  | —                                                                                      |  | September 30, 2016                    
|December 31, 2013  |  | $91,378                                  |  | $0                                             |  | 455.09%                                                                           |  | —                                                                                      |  | December 31, 2016                     
|March 31, 2014     |  | $68,293                                  |  | $0                                             |  | 148.96%                                                                           |  | —                                                                                      |  | March 31, 2017                        
|June 30, 2014      |  | $70,027                                  |  | $898,518                                       |  | 23.17%                                                                            |  | —                                                                                      |  | June 30, 2017                         
|September 30, 2014 |  | $92,143                                  |  | $71,060                                        |  | 20.39%                                                                            |  | —                                                                                      |  | September 30, 2017                    
|December 31, 2014  |  | $115,777                                 |  | $90,860                                        |  | 11.15%                                                                            |  | —                                                                                      |  | December 31, 2017                     
|March 31, 2015     |  | $134,301                                 |  | $106,217                                       |  | 13.75%                                                                            |  | 2.01%                                                                                  |  | March 31, 2018                        
|June 30, 2015      |  | $166,549                                 |  | $167,113                                       |  | 14.10%                                                                            |  | 3.20%                                                                                  |  | June 30, 2018                         
|September 30, 2015 |  | $147,747                                 |  | $240,848                                       |  | 10.45%                                                                            |  | 3.20%                                                                                  |  | September 30, 2018                    
|December 31, 2015  |  | $136,401                                 |  | $280,376                                       |  | 7.41%                                                                             |  | 3.60%                                                                                  |  | December 31, 2018                     
|March 31, 2016     |  | $157,996                                 |  | $232,895                                       |  | 6.00%                                                                             |  | 3.52%                                                                                  |  | March 31, 2019                        
|June 30, 2016      |  | $206,933                                 |  | $285,878                                       |  | 4.95%                                                                             |  | 3.52%                                                                                  |  | June 30, 2019                         
|September 30, 2016 |  | $201,573                                 |  | $223,020                                       |  | 4.52%                                                                             |  | 3.13%                                                                                  |  | September 30, 2019                    
|December 31, 2016  |  | $104,561                                 |  | $168,876                                       |  | 4.45%                                                                             |  | 3.11%                                                                                  |  | December 31, 2019                     
|March 31, 2017     |  | $80,847                                  |  | $252,875                                       |  | 4.21%                                                                             |  | 3.19%                                                                                  |  | March 31, 2020                        
|June 30, 2017      |  | $0                                       |  | $176,963                                       |  | 3.98%                                                                             |  | 3.18%                                                                                  |  | June 30, 2020                         
|September 30, 2017 |  | $0                                       |  | $119,188                                       |  | 4.19%                                                                             |  | 3.00%                                                                                  |  | September 30, 2020                    
|December 31, 2017  |  | $0                                       |  | $0                                             |  | N/A                                                                               |  | N/A                                                                                    |  | N/A                                   







|(1) | “Operating Expense Ratio” includes all expenses borne by us, except for organizational and offering expenses, base management and incentive fees owed to our Adviser, financing fees and costs, interest expense, brokerage commissions and extraordinary expenses.The Company did not achieve its minimum offering amount until June 25, 2014 and as a result, did not invest the proceeds from the offering and realize any income from investments prior to the end of its fiscal quarter.                                                                                                                                                                   
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | “Annualized Distribution Rate” equals the annualized rate of distributions paid to stockholders based on the amount of the regular cash distribution paid immediately prior to the date the expense support payment obligation was incurred by our Adviser. “Annualized Distribution Rate” does not include special cash or stock distributions paid to stockholders. The Company did not achieve its minimum offering amount until June 25, 2014 and as a result, did not have an opportunity to invest the proceeds from the offering and realize any income from investments or pay any distributions to stockholders prior to the end of its fiscal quarter.

Beginning with the year ended December
31, 2016, the Adviser began to reimburse less than 100% of operating expenses, and for the year ended December 31, 2017, the Adviser
did not reimburse any operating expenses after the first quarter. Additionally, the Adviser did not reimburse any offering expenses
for the first quarter of 2018. Of these offering and operating expenses, $1,941,553 has exceeded the three-year period for repayment
and will not be repayable by us.





41







The chart below, on a cumulative basis,
discloses the components of the Reimbursement due from Advisor reflected on the chart above:





|                                     |  | March 31, |            |   | December 31, |  
|------------------------------------ |  | --------- | ---------- | - | ------------ | -
|                                     |  | 2018      |            |   | 2017         |  
|Operating Expenses                   |  | $         | 1,977,504  |   |              | $
|Offering Costs                       |  |           | 3,314,687  |   |              |  
|Due to related party offset          |  |           | (4,780,282 | ) |              |  
|Reimbursements received from Adviser |  |           | (342,715   | ) |              |  
|Other amounts due to affiliates      |  |           | 15,559     |   |              |  
|Total Reimbursement due from Adviser |  | $         | 184,753    |   |              | $







Operating Expensesare the
amounts reimbursed by the Adviser for our operating costs and Offering Costs are the cumulative amount of organizational
and offering expenses reimbursed to us by the Adviser and subject to future reimbursement per the terms of our expense reimbursement
agreement.



Due to related party offsetrepresents
the cash the Adviser paid directly for our operating and offering expenses and Reimbursements received from sponsorare
the amounts the Adviser paid in cash to us for reimbursement of our operating and offering costs.



Asset Coverage



In accordance with the Company Act, the
Company is currently only allowed to borrow amounts such that its “asset coverage,” as defined in the Company Act,
is at least 200% after such borrowing. “Asset coverage” generally refers to a company’s total assets, less all
liabilities and indebtedness not represented by “senior securities,” as defined in the Company Act, divided by total
senior securities representing indebtedness and, if applicable, preferred stock. “Senior securities” for this purpose
includes borrowings from banks or other lenders, debt securities and preferred stock. As of March 31, 2018 and December 31,
2017, the Company did not have any senior securities.



On March 23, 2018, an amendment to Section
61(a) of the Company Act was signed into law to permit BDCs to reduce the minimum “asset coverage” ratio from 200%
to 150%, so long as certain approval and disclosure requirements are satisfied. In addition, for BDCs like the Company whose securities
are not listed on a national securities exchange, the Company is also required to offer to repurchase its outstanding shares at
the rate of 25% per quarter over four calendar quarters. Under the existing 200% minimum asset coverage ratio, the Company is permitted
to borrow up to one dollar for investment purposes for every one dollar of investor equity, and under the 150% minimum asset coverage
ratio, the Company will be permitted to borrow up to two dollars for investment purposes for every one dollar of investor equity.
In other words, Section 61(a) of the Company Act, as amended, permits BDCs to potentially increase their debt-to-equity ratio from
a maximum of 1 to 1 to a maximum of 2 to 1.



On April 18, 2018, the Board of Directors
of the Company, including a “required majority” (as such term is defined in Section 57(o) of the Company Act), approved
the application to the Company of the 150% minimum asset coverage ratio set forth in Section 61(a)(2) of the Company Act. As a
result, and subject to certain additional disclosure requirements and the repurchase obligations described above, the minimum asset
coverage ratio applicable to the Company will be reduced from 200% to 150%, effective as of April 18, 2019. In addition, in order
to provide the Company with the maximum financial flexibility at the earliest possible date, the Board of Directors also authorized
the submission of a proposal for stockholders to approve the application of the 150% minimum asset coverage ratio to the Company
at the Company’s 2018 Annual Meeting. If the Company’s stockholders approve such proposal at the 2018 Annual Meeting,
the 150% minimum asset coverage ratio will then apply effective as of June 21, 2018, the first day after the 2018 Annual Meeting
and, as a result, the Company will be permitted to incur double the maximum amount of leverage that the Company is able to incur
currently approximately ten months earlier than if the Company’s stockholders do not vote to approve such proposal.





42







Critical Accounting Policies



This discussion of
our expected operating plans is based upon our expected financial statements, which will be prepared in accordance with accounting
principles generally accepted in the United States, or GAAP. The preparation of these financial statements will require our management
to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses. Changes in the
economic environment, financial markets and any other parameters used in determining such estimates could cause actual results
to differ. In addition to the discussion below, we will describe our critical accounting policies in the notes to our future financial
statements.



Valuation of Investments



Our board of directors
has established procedures for the valuation of our investment portfolio. These procedures are detailed below.



Investments for which
market quotations are readily available will be valued at such market quotations. For most of our investments, market quotations
will not be available. With respect to investments for which market quotations are not readily available or when such market quotations
are deemed not to represent fair value, our board of directors has approved a multi-step valuation process each quarter, as described
below:





| | 1. | Each portfolio company or investment will be valued by our Adviser, potentially with assistance
from one or more independent valuation firms engaged by our board of directors;
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 2. | the independent valuation firm, if involved, will conduct independent appraisals and make an independent
assessment of the value of each investment;
| | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------



| | 3. | the audit committee of our board of directors will review and discuss the preliminary valuation
prepared by our Adviser and that of the independent valuation firm, if any; and
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 4. | the board of directors will discuss the valuations and determine the fair value of each investment
in our portfolio in good faith based on the input of our Adviser, the independent valuation firm, if any, and the audit committee.
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Investments
will be valued utilizing a cost approach, a market approach, an income approach, or a combination of approaches, as appropriate.
The cost approach is most likely only to be used early in the life of an investment or if we determine that there has been no
material change in the investment since purchase. The market approach uses prices and other relevant information generated by
market transactions involving identical or comparable assets or liabilities (including a business). The income approach uses valuation
techniques to convert future amounts (for example, cash flows or earnings) to a single present value amount, calculated using
an appropriate discount rate. The measurement is based on the net present value indicated by current market expectations about
those future amounts. In following these approaches, the types of factors that we may take into account in fair value pricing
our investments include, as relevant: available current market data, including relevant and applicable market trading and transaction
comparables, applicable market yields and multiples, security covenants, call protection provisions, information rights, the nature
and realizable value of any collateral, the Company’s ability to make payments, its earnings and discounted cash flows,
the markets in which the Company does business, comparisons of financial ratios of peer companies that are public, M&A comparables,
the principal market and enterprise values, among other factors.



We have adopted ASC
Topic 820, Fair Value Measurements and Disclosures, which defines fair value, establishes a framework for measuring fair value
in accordance with generally accepted accounting principles and expands disclosures about fair value measurements.





43







ASC Topic 820 provides
a consistent definition of fair value which focuses on exit price and prioritizes, within a measurement of fair value, the use
of market-based inputs over entity-specific inputs. It defines fair value as the price an entity would receive when an asset is
sold or when a liability is transferred in an orderly transaction between market participants at the measurement date. In addition,
ASC Topic 820 provides a framework for measuring fair value and establishes a three-level hierarchy for fair value measurements
based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date. The three levels of
valuation hierarchy established by ASC Topic 820 are defined as follows:



Level 1: Quoted prices in active
markets for identical assets or liabilities, accessible by the company at the measurement date.



Level 2: Quoted prices for similar
assets or liabilities in active markets, or quoted prices for identical or similar assets or liabilities in markets that are not
active, or other observable inputs other than quoted prices.



Level 3: Unobservable
inputs for the asset or liability.



In all cases, the level
in the fair value hierarchy within which the fair value measurement in its entirety falls has been determined based on the lowest
level of input that is significant to the fair value measurement. Our assessment of the significance of a particular input to the
fair value measurement in its entirety requires judgment and considers factors specific to each investment.



In accordance with
ASC Topic 820, the fair value of our investments is defined as the price that we would receive upon selling an investment in an
orderly transaction to an independent buyer in the principal or most advantageous market in which that investment is transacted.



Revenue Recognition



We record interest
income on an accrual basis to the extent that we expect to collect such amounts. For loans and debt securities with contractual
PIK interest, which represents contractual interest accrued and added to the principal balance, we generally will not accrue PIK
interest for accounting purposes if the portfolio company valuation indicates that such PIK interest is not collectible. We do
not accrue as a receivable interest on loans and debt securities for accounting purposes if we have reason to doubt our ability
to collect such interest. Original issue discounts, market discounts or premiums are accreted or amortized using the effective
interest method as interest income. We record prepayment premiums on loans and debt securities as interest income. Dividend income,
if any, is recognized on an accrual basis to the extent that we expect to collect such amount.



Net Realized Gains or Losses and
Net Change in Unrealized Appreciation or Depreciation



We will measure net
realized gains or losses by the difference between the net proceeds from the repayment or sale and the amortized cost basis of
the investment, without regard to unrealized appreciation or depreciation previously recognized, but considering unamortized upfront
fees and prepayment penalties. Net change in unrealized appreciation or depreciation will reflect the change in portfolio investment
values during the reporting period, including any reversal of previously recorded unrealized appreciation or depreciation, when
gains or losses are realized.



Payment-in-Kind Interest



We may have investments
in our portfolio that contain a PIK interest provision. Any PIK interest will be added to the principal balance of such investments
and is recorded as income, if the portfolio company valuation indicates that such PIK interest is collectible. In order to maintain
our status as a RIC, substantially all of this income must be paid out to stockholders in the form of distributions, even if we
have not collected any cash.





44







Organization and Offering Expenses



We have incurred certain
expenses in connection with the registration of shares of our common stock for sale as discussed in Note 2 of our financial statements–
Description of Business and Summary of Significant Accounting Policies. These costs principally relate to professional fees, fees
paid to the SEC and fees paid to the Financial Industry Regulatory Authority. These costs were included in deferred offering costs
in the accompanying balance sheets. Simultaneous with the sale of common shares, the deferred offering costs will be reclassified
to stockholders’ equity upon the issuance of shares.



Federal Income Taxes



We elected to be treated,
beginning with our fiscal year ending December 31, 2012, and intend to qualify annually thereafter, as a RIC under Subchapter M
of the Code. As a RIC, we generally will not have to pay corporate-level federal income taxes on any ordinary income or capital
gains that we distribute to our stockholders from our tax earnings and profits. To maintain our RIC tax treatment, we must, among
other things, meet specified source-of-income and asset diversification requirements and distribute annually at least 90% of our
ordinary income and realized net short-term capital gains in excess of realized net long-term capital losses, if any.



|Item
        3: Quantitative and Qualitative Disclosures About Market Risk.
|---------------------------------------------------------------------------

We are subject to financial
market risks, including changes in interest rates. As of March 31, 2018, 96.3% (based on fair value) of our investments paid variable
interest rates, 0% paid fixed rates, and 3.7% were non-income producing equity. A rise in the general level of interest rates can
be expected to lead to higher interest rates applicable to certain variable rate investments we hold and to declines in the value
of any fixed rate investments we may hold in the future.



The following table
shows the effect over a twelve-month period of changes in interest rates on our interest income, interest expense and net interest
income, assuming no changes in our investment portfolio and borrowing arrangements in effect as of March 31, 2018:





|LIBOR Basis Point Change |  | Percentage
    Change in  Net Interest Income |      
|------------------------ |  | --------------------------------------------- | -----
|Down 25 basis points     |  |                                               | -3.06
|Current LIBOR            |  |                                               | 0.00 
|Up 100 basis points      |  |                                               | 28.27
|Up 200 basis points      |  |                                               | 40.50
|Up 300 basis points      |  |                                               | 52.73







Because we may borrow
money to make investments, our net investment income may be dependent on the difference between the rate at which we borrow funds
and the rate at which we invest these funds. In periods of increasing interest rates, our cost of funds would increase, which may
reduce our net investment income. As a result, there can be no assurance that a significant change in market interest rates will
not have a material adverse effect on our net investment income.



We may also face risk
due to the lack of liquidity in the marketplace which could prevent us from raising sufficient funds to adequately invest in a
broad pool of assets. We are subject to other financial market risks, including changes in interest rates. However, at this time,
with no portfolio investments, this risk is immaterial.



In addition, we may
have risk regarding portfolio valuation. See “Part I - Item 2. Management’s Discussion and Analysis of Financial Condition
and Results of Operations—Critical Accounting Policies—Valuation of Investments.”





45







|Item
    4: Controls and Procedures.
|------------------------------------



Disclosure Controls



In accordance with
Rules 13a-15(b) and 15d-15(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), we, under the
supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, carried out an evaluation of
the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) and Rule 15d-15(e) of the Exchange Act)
as of the end of the period covered by this Quarterly Report on Form 10-Q and determined that the disclosure controls and procedures
are effective.



Change in Internal Control Over Financial
Reporting



No change occurred
in our internal control over financial reporting (as defined in Rule 13a-15(f) and 15d-15(f) of the Exchange Act) during the three
months ended March 31, 2018 that has materially affected, or is reasonably likely to materially affect, our internal control over
financial reporting.



Part
II—Other Information



|Item
    1: Legal Proceedings.
|------------------------------





The Company is not
currently subject to any legal proceedings, nor, to our knowledge, are any legal proceedings threatened against us or our subsidiaries.



|Item
    1A: Risk Factors.
|--------------------------



Except
as set forth below, there have been no material changes from the risk factors set forth in our annual report on Form 10-K for the
fiscal year ended December 31, 2017.



Risks Related to Our Investments.



We may from
time to time enter into total return swaps or other derivative transactions which expose us to certain risks, including credit
risk, market risk, liquidity risk and other risks similar to those associated with the use of leverage.



We may from time
to time enter into total return swaps or other derivative transactions that seek to modify or replace the investment performance
of a particular reference security or other asset. These transactions are typically individually negotiated, non-standardized agreements
between two parties to exchange payments, with payments generally calculated by reference to a notional amount or quantity. Swap
contracts and similar derivative contracts are not traded on exchanges; rather, banks and dealers act as principals in these markets.
These investments may present risks in excess of those resulting from the referenced security or other asset. Because these transactions
are not an acquisition of the referenced security or other asset itself, the investor has no right directly to enforce compliance
with the terms of the referenced security or other asset and has no voting or other consensual rights of ownership with respect
to the referenced security or other asset. In the event of insolvency of a counterparty, we will be treated as a general creditor
of the counterparty and will have no claim of title with respect to the referenced security or other asset.



A total return
swap is a contract in which one party agrees to make periodic payments to another party based on the change in the market value
of the referenced security or other assets underlying the total return swap during a specified period, in return for periodic payments
based on a fixed or variable interest rate.



A total return
swap is subject to market risk, liquidity risk and risk of imperfect correlation between the value of the total return swap and
the debt obligations underlying the total return swap. In addition, we may incur certain costs in connection with a total return
swap that could in the aggregate be significant.



A derivative transaction
is also subject to the risk that a counterparty will default on its payment obligations thereunder or that we will not be able
to meet our obligations to the counterparty. In some cases, we may post collateral to secure our obligations to the counterparty,
and we may be required to post additional collateral upon the occurrence of certain events such as a decrease in the value of the
reference security or other asset. In some cases, the counterparty may not collateralize any of its obligations to us.





46







Derivative investments
effectively add leverage to a portfolio by providing investment exposure to a security or market without owning or taking physical
custody of such security or investing directly in such market. In addition to the risks described above, such arrangements are
subject to risks similar to those associated with the use of leverage.



Risks Related
to Business Development Companies.



Recent Legislation may allow us to
incur additional leverage.



The Company Act generally prohibits us
from incurring indebtedness unless immediately after such borrowing we have an asset coverage for total borrowings of at least
200% (i.e., the amount of debt may not exceed 50% of the value of our assets). However, recent legislation has modified the Company
Act by allowing a BDC to increase the maximum amount of leverage it may incur from an asset coverage ratio of 200% to an asset
coverage ratio of 150%, if certain requirements are met. On April 18, 2018, the Board of Directors of the Company, including a
“required majority” (as such term is defined in Section 57(o) of the Company Act), approved the application to the
Company of the 150% minimum asset coverage ratio set forth in Section 61(a)(2) of the Company Act. As a result, and subject to
certain requirements, the minimum asset coverage ratio applicable to the Company will be reduced from 200% to 150%, effective as
of April 18, 2019. In addition, the Board of Directors also authorized the submission of a proposal for stockholders to approve
the application of the 150% minimum asset coverage ratio to the Company at the Company’s 2018 Annual Meeting. If the Company’s
stockholders approve such proposal at the 2018 Annual Meeting, the 150% minimum asset coverage ratio will then apply effective
as of June 21, 2018, the first day after the 2018 Annual Meeting and, as a result, the Company will be permitted to incur double
the maximum amount of leverage that the Company is able to incur currently approximately ten months earlier than if the Company’s
stockholders do not vote to approve such proposal.



As a result of this legislation, we will
be able to increase our leverage up to an amount that reduces our asset coverage ratio from 200% to 150%. Leverage magnifies the
potential for loss on investments in our indebtedness and on invested equity capital. As we use leverage to partially finance our
investments, you will experience increased risks of investing in our securities. If the value of our assets increases, then leveraging
would cause the net asset value attributable to our common stock to increase more sharply than it would have had we not leveraged.
Conversely, if the value of our assets decreases, leveraging would cause net asset value to decline more sharply than it otherwise
would have had we not leveraged our business. Similarly, any increase in our income in excess of interest payable on the borrowed
funds would cause our net investment income to increase more than it would without the leverage, while any decrease in our income
would cause net investment income to decline more sharply than it would have had we not borrowed. Such a decline could negatively
affect our ability to pay common stock dividends, scheduled debt payments or other payments related to our securities. Leverage
is generally considered a speculative investment technique. See “Risks Related to Debt Financing.”



Risks Related
to Debt Financing



If we borrow
money, which we currently intend to do, the potential for gain or loss on amounts invested in our common stock will be magnified
and may increase the risk of investing in our common stock.



The use of borrowings
and other types of financing, also known as leverage, magnify the potential for gain or loss on amounts invested and, therefore,
increase the risks associated with investing in our shares. If we use leverage to partially finance our investments, through borrowing
from banks and other lenders we, and therefore you, will experience increased risks of investing in our common stock. Any lenders
and debt holders would have fixed dollar claims on our assets that are superior to the claims of our stockholders. If the value
of our assets increases, then leverage would cause the net asset value attributable to our common stock to increase more sharply
than it would have had we not leveraged. Conversely, if the value of our assets decreases, leverage would cause net asset value
to decline more sharply than it otherwise would have had we not leveraged. Similarly, any increase in our income in excess of interest
payable on the borrowed funds would cause our net investment income to increase more than it would without the leverage, while
any decrease in our income would cause net investment income to decline more sharply than it would have had we not borrowed. Such
a decline could negatively affect our ability to make distributions to stockholders. Leverage is generally considered a speculative
investment technique. In addition, the decision to utilize leverage will increase our assets and, as a result, will increase the
amount of base management fees payable to or Adviser.





47







Changes
in interest rates may affect our cost of capital and net investment income.



Because we intend
to use debt to finance investments, our net investment income will depend, in part, upon the difference between the rate at which
we borrow funds and the rate at which we invest those funds. As a result, we can offer no assurance that a significant change in
market interest rates will not have a material adverse effect on our net investment income. In periods of rising interest rates
when we have debt outstanding, our cost of funds will increase, which could reduce our net investment income. We may use interest
rate risk management techniques in an effort to limit our exposure to interest rate fluctuations. These techniques may include
various interest rate hedging activities to the extent permitted by the Company Act. These activities may limit our ability to
participate in the benefits of lower interest rates with respect to the hedged portion of our portfolio. Adverse developments resulting
from changes in interest rates or hedging transactions could have a material adverse effect on our business, financial condition
and results of operations. Also, we have limited experience in entering into hedging transactions, and we will initially have to
develop such expertise or arrange for such expertise to be provided.



Federal Income Tax Risks



We cannot predict how tax reform
legislation will affect us, our investments, or our stockholders, and any such legislation could adversely affect our business.



Legislative or other actions relating to
taxes could have a negative effect on us. The rules dealing with U.S. federal income taxation are constantly under review by persons
involved in the legislative process and by the Internal Revenue Service and the U.S. Treasury Department. In December 2017, the
U.S. House of Representatives and U.S. Senate passed tax reform legislation, which the President signed into law. Such legislation
has made many changes to the Code, including significant changes to the taxation of business entities, the deductibility of interest
expense, and the tax treatment of capital investment. We cannot predict with certainty how any changes in the tax laws might affect
us, our stockholders, or our portfolio investments. New legislation and any U.S. Treasury regulations, administrative interpretations
or court decisions interpreting such legislation could significantly and negatively affect our ability to qualify for tax treatment
as a RIC or the U.S. federal income tax consequences to us and our stockholders of such qualification, or could have other adverse
consequences. Stockholders are urged to consult with their tax advisor regarding tax legislative, regulatory, or administrative
developments and proposals and their potential effect on an investment in our securities.



|Item
    2: Unregistered Sales of Equity Securities and Use of Proceeds.
|------------------------------------------------------------------------



None.



|Item
    3: Defaults Upon Senior Securities.
|--------------------------------------------



None.



|Item
    4: Mine Safety Disclosures.
|------------------------------------



None.



|Item 5: Other Information.
|--------------------------

None.





48







|Item
    6: Exhibits.
|---------------------



EXHIBIT INDEX



|Number |  | Description                                                                                                                                           
|------ |  | ------------------------------------------------------------------------------------------------------------------------------------------------------
|       |  |                                                                                                                                                       
|       |  |                                                                                                                                                       
|31.1   |  | Certification by Chief Executive Officer pursuant to Exchange Act Rule 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|31.2   |  | Certification by Chief Financial Officer pursuant to Exchange Act Rule 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|32.1   |  | Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.                               



49







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.



|                    |                                             |                                                                                                                          
|------------------- | ------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------
|Dated: May 15, 2018 | Triton Pacific Investment Corporation, Inc.
|                    |                                             |                                                                                                                          
|                    | By                                          | /s/ Craig J. Faggen                                                                                                      
|                    |                                             | Craig J. Faggen
        
        Chief Executive Officer
        
        (Principal Executive Officer)                  
|                    |                                             |                                                                                                                          
|Dated: May 15, 2018 | By                                          | /s/ Michael L. Carroll                                                                                                   
|                    |                                             | Michael L. Carroll
        
        Chief Financial Officer
        
        (Principal Accounting and Financial Officer)



50