Exhibit 99.1
WhiteHorse Finance, Inc. Announces Fourth Quarter and Full Year 2016 Earnings Results
NEW YORK, NY, March 2, 2017 – WhiteHorse Finance, Inc. (“WhiteHorse Finance” or the “Company”) (NASDAQ: WHF) today announced its financial results for the quarter and year ended December 31, 2016.
Fourth Quarter 2016 Summary Highlights
| · | New investments of $20.1 million and $63.9 million for the fourth quarter and year, respectively |
| · | Net investment income of $6.6 million, or $0.358 per share, for the fourth quarter |
| · | Annual net investment income of $27.0 million, or $1.48 per share |
| · | Annual distribution of $1.42 per share |
Stuart Aronson, WhiteHorse Finance’s Chief Executive Officer commented, “This was a solid quarter for WhiteHorse, with strong net interest income and modest gains in our NAV. The leadership of our firm remains committed to conservative investing in senior secured assets with a goal of earning our dividend each year and protecting NAV. The pipeline for the first quarter is strong.”
Portfolio and Investment Activity
As of December 31, 2016, the fair value of WhiteHorse Finance’s investment portfolio was $411.7 million, compared with $415.3 million as of December 31, 2015. The portfolio at December 31, 2016 consisted of 37 positions across 29 companies with an average investment size of $11.1 million based on fair value, a weighted average effective yield of 11.8%, and an estimated weighted average leverage multiple of 3.4x. The majority of the portfolio comprised senior secured loans and approximately 99.8% of these loans were variable-rate investments (primarily indexed to LIBOR), which should continue to position the portfolio well in a rising interest rate environment.
For the three months ended December 31, 2016, WhiteHorse Finance invested $20.1 million across two new portfolio companies. Gross proceeds from sales and repayments totaled $2.5 million for the quarter. In addition, WhiteHorse Finance refinanced its $36.8 million loan to Future Payment Technologies into a new $23.3 million first lien loan; reducing its net position by $13.5 million.
For the year ended December 31, 2016, WhiteHorse Finance invested $63.9 million across seven new portfolio companies. Also, the Company invested $3.2 million in existing portfolio companies. Gross proceeds from sales and repayments totaled $71.3 million for the year. In addition, WhiteHorse Finance refinanced two investments resulting in a net decrease in these investments of $2.9 million.
Results of Operations
For the three months and year ended December 31, 2016, net investment income was approximately $6.6 million and $27.0 million, compared with approximately $3.9 million and $20.8 million for the same periods in the prior year. The increase in net investment income was primarily attributable to (i) an increase in the balance of average earning investments over the same periods in the prior year, (ii) higher amortization of original issue discount related to repayments and (iii) the 2015 write off of deferred financing costs related to a credit line refinancing. In the past 24 months, cumulative core net investment income, a non-GAAP financial measure, exceeded distributions to stockholders.(1)
For the three months and year ended December 31, 2016, WhiteHorse Finance reported realized and unrealized gain on investments of $2.5 million and $4.3 million, respectively. This compares with realized and unrealized losses on investments of $18.7 million and $23.6 million for the three months and year ended December 31, 2015, respectively. The increase in realized and unrealized gains on investments was primarily attributable to the recognition of unrealized loss in the Company’s investment in RCS Capital Corporation during the fourth quarter of 2015.
For the three months and year ended December 31, 2016, WhiteHorse Finance reported net increases in net assets of $9.1 million and $31.3 million, respectively, which compares to net decreases in net assets of $14.8 million and $2.8 million for the three months and year ended December 31, 2015.
WhiteHorse Finance’s NAV was $249.4 million, or $13.63 per share, as of December 31, 2016, as compared with $246.8 million, or $13.48 per share, as of September 30, 2016. As of December 31, 2015, WhiteHorse Finance’s NAV was $244.0 million, or $13.33 per share.
Liquidity and Capital Resources
As of December 31, 2016, WhiteHorse Finance had cash and cash equivalents of $28.9 million, as compared with cash and cash equivalents of $23.7 million as of September 30, 2016, inclusive of restricted cash. As of December 31, 2016, the Company had approximately $40 million of undrawn capacity under its revolving credit facility.
Distributions
On December 19, 2016, the Company declared a distribution of $0.355 per share for the quarter ended December 31, 2016, consistent for the seventeenth consecutive quarter since the Company’s IPO. The distribution was paid on January 3, 2017 to shareholders of record as of December 20, 2016.
Distributions are paid from taxable earnings and may include return of capital and/or capital gains. The specific tax characteristics of the distributions will be reported to stockholders on Form 1099-DIV after the end of the calendar year and in the Company's periodic reports filed with the Securities and Exchange Commission.
Conference Call
WhiteHorse Finance will host a conference call to discuss its fourth quarter and fiscal year-end results at 10:00 am ET on Thursday, March 2, 2017. To access the teleconference, please dial 706-758-9224 (domestic and international) approximately 10 minutes before the teleconference’s scheduled start time and reference ID #70205251. Investors may also access the call on the investor relations portion of the Company’s website atwww.whitehorsefinance.com.
If you are unable to access the live teleconference, a replay will be available beginning approximately two hours after the call’s completion through March 7, 2017. The teleconference replay can be accessed by dialing 404-537-3406 (domestic and international) and entering ID #70205251. A webcast replay will also be available on the investor relations portion of the Company’s website atwww.whitehorsefinance.com.
About WhiteHorse Finance, Inc.
WhiteHorse Finance is a business development company that originates and invests in loans to privately held small-cap companies across a broad range of industries. The Company's investment activities are managed by WhiteHorse Advisers, an affiliate of H.I.G. Capital. H.I.G. Capital is a leading global alternative asset manager with $21 billion of capital under management(2) across a number of funds focused on the small and mid-cap markets. For more information about H.I.G. Capital, please visit http://www.higcapital.com. For more information about the Company, please visit http://www.whitehorsefinance.com.
Forward-Looking Statements
This press release may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Statements other than statements of historical facts included in this press release may constitute forward-looking statements and are not guarantees of future performance or results and involve a number of risks and uncertainties. Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including those described from time to time in filings with the Securities and Exchange Commission. The Company undertakes no duty to update any forward-looking statement made herein. All forward-looking statements speak only as of the date of this press release.
(1) Net investment income and core net investment income during the three months ended December 31, 2015 were $0.237 per share and $0.352 per share, respectively. Net investment income was equal to core net investment income for every other quarter since the Company’s initial public offering. Core net investment income is a non-GAAP financial measure. The Company believes that core net investment income provides useful information to investors and management because it reflects the Company's financial performance excluding the net impact of costs associated with the refinancing of the Company’s revolving credit facility. The presentation of this additional information is not meant to be considered in isolation or as a substitute for financial results prepared in accordance with GAAP.
(2) Based on total capital commitments managed by H.I.G. Capital and affiliates.
Contacts
WhiteHorse Finance, Inc.
Stuart Aronson, 212-506-0500
saronson@higwhitehorse.com
or
WhiteHorse Finance, Inc.
Edward J. Giordano, 305-379-2322
egiordano@higwhitehorse.com
or
Prosek Partners
Sean Silva, 212-279-3115
ssilva@prosek.com
Source: WhiteHorse Finance, Inc.
WhiteHorse Finance, Inc.
Consolidated Statements of Assets and Liabilities
(in thousands, except share and per share data)
| December 31, 2016 | December 31, 2015 | |||||||
| Assets | ||||||||
| Investments, at fair value | ||||||||
| Non-controlled/non-affiliate company investments | $ | 392,721 | $ | 395,143 | ||||
| Non-controlled affiliate company investments | 18,993 | 20,200 | ||||||
| Total investments, at fair value (amortized cost $427,684 and $436,109, respectively) | 411,714 | 415,343 | ||||||
| Cash and cash equivalents | 17,036 | 22,769 | ||||||
| Restricted cash and cash equivalents | 11,858 | — | ||||||
| Interest receivable | 3,891 | 3,407 | ||||||
| Receivable for unsettled transactions | 881 | — | ||||||
| Prepaid expenses and other receivables | 854 | 192 | ||||||
| Total assets | $ | 446,234 | $ | 441,711 | ||||
| Liabilities | ||||||||
| Debt | $ | 182,338 | $ | 183,482 | ||||
| Distributions payable | 6,498 | 6,498 | ||||||
| Management fees payable | 5,476 | 3,813 | ||||||
| Payables for investments purchased | 995 | 2,865 | ||||||
| Interest payable | 480 | — | ||||||
| Accounts payable and accrued expenses | 1,058 | 1,001 | ||||||
| Total liabilities | 196,845 | 197,659 | ||||||
| Commitments and contingencies (See Note 7) | ||||||||
| Net assets | ||||||||
| Common stock, 18,303,890 shares issued and outstanding, par value $0.001 per share and 100,000,000 authorized | 18 | 18 | ||||||
| Paid-in capital in excess of par | 271,679 | 271,679 | ||||||
| Accumulated over distributed net investment income | (6,400 | ) | (7,419 | ) | ||||
| Accumulated realized gains on investments | 698 | 1,176 | ||||||
| Accumulated unrealized depreciation on investments | (16,606 | ) | (21,402 | ) | ||||
| Total net assets | 249,389 | 244,052 | ||||||
| Total liabilities and total net assets | $ | 446,234 | $ | 441,711 | ||||
| Number of shares outstanding | 18,303,890 | 18,303,890 | ||||||
| Net asset value per share | $ | 13.63 | $ | 13.33 | ||||
WhiteHorse Finance, Inc.
Consolidated Statements of Operations
(in thousands, except share and per share data)
| Years ended December 31, | ||||||||||||
| 2016 | 2015 | 2014 | ||||||||||
| Investment income | ||||||||||||
| Interest income | $ | 48,649 | $ | 42,380 | $ | 35,148 | ||||||
| Fee income | 2,290 | 1,894 | 1,604 | |||||||||
| Dividend income | 2,910 | 2,800 | 794 | |||||||||
| Total investment income | 53,849 | 47,074 | 37,546 | |||||||||
| Expenses | ||||||||||||
| Interest expense | 8,188 | 9,970 | 5,818 | |||||||||
| Base management fees | 8,990 | 8,560 | 7,557 | |||||||||
| Performance-based incentive fees | 6,755 | 4,323 | 3,387 | |||||||||
| Administrative service fees | 684 | 1,140 | 1,510 | |||||||||
| General and administrative expenses | 2,221 | 2,326 | 2,720 | |||||||||
| Total expenses, before fees waived | 26,838 | 26,319 | 20,992 | |||||||||
| Base management fees waived | — | — | (447 | ) | ||||||||
| Total expenses, net of fees waived | 26,838 | 26,319 | 20,545 | |||||||||
| Net investment income | 27,011 | 20,755 | 17,001 | |||||||||
| Realized and unrealized gains (losses) on investments | ||||||||||||
| Net realized losses | ||||||||||||
| Non-controlled/non-affiliate company investments | (478 | ) | (379 | ) | (64 | ) | ||||||
| Net realized losses | (478 | ) | (379 | ) | (64 | ) | ||||||
| Net change in unrealized appreciation (depreciation) | ||||||||||||
| Non-controlled/non-affiliate company investments | 6,003 | (23,404 | ) | 2,607 | ||||||||
| Non-controlled/affiliate company investments | (1,207) | 200 | — | |||||||||
| Net change in unrealized appreciation (depreciation) | 4,796 | (23,204 | ) | 2,607 | ||||||||
| Net realized and unrealized gains (losses) on investments | 4,318 | (23,583) | 2,543 | |||||||||
| Net increase (decrease) in net assets resulting from operations | $ | 31,329 | $ | (2,828) | $ | 19,544 | ||||||
| Per Common Share Data | ||||||||||||
| Basic and diluted earnings (loss) per common share | $ | 1.71 | $ | (0.18) | $ | 1.30 | ||||||
| Dividends and distributions declared per common share | $ | 1.42 | $ | 1.42 | $ | 1.42 | ||||||
| Basic and diluted weighted average common shares outstanding | 18,303,890 | 15,319,510 | 14,982,825 | |||||||||
WhiteHorse Finance, Inc.
Consolidated Schedule of Investments
December 31, 2016
(in thousands)
| Investment Type(1) | Spread Above Index(2) | Interest Rate(3) | Maturity Date | Principal Amount | Amortized Cost | Fair Value | Fair Value As A Percentage Of Net Assets | |||||||||||||||
| North America | ||||||||||||||||||||||
| Debt Investments | ||||||||||||||||||||||
| Advertising | ||||||||||||||||||||||
| Outcome Health | ||||||||||||||||||||||
| First Lien Secured Term Loan | L+6.50% (1.00% Floor) | 7.50% | 12/22/21 | $ | 18,500 | $ | 16,652 | $ | 16,872 | 6.77 | % | |||||||||||
| Fluent Acquisition II, LLC | ||||||||||||||||||||||
| First Lien Secured Term Loan | L+11.50% (0.69% Floor) | 12.19% (1.00% PIK) | 12/8/20 | 26,885 | 26,466 | 26,745 | 10.72 | |||||||||||||||
| Intersection Acquisition, LLC | ||||||||||||||||||||||
| First Lien Secured Term Loan | L+10.00% (1.00% Floor) | 11.00% | 9/15/20 | 16,149 | 16,029 | 15,597 | 6.25 | |||||||||||||||
| 61,534 | 59,147 | 59,214 | 23.74 | |||||||||||||||||||
| Auto Parts & Equipment | ||||||||||||||||||||||
| Crowne Group, LLC | ||||||||||||||||||||||
| First Lien Secured Term Loan | L+9.25% (1.00% Floor) | 10.25% | 5/26/21 | 12,406 | 12,027 | 12,282 | 4.92 | |||||||||||||||
| Broadcasting | ||||||||||||||||||||||
| Multicultural Radio Broadcasting, Inc. | ||||||||||||||||||||||
| First Lien Secured Term Loan | L+10.50% (1.00% Floor) | 11.50% | 6/27/19 | 14,850 | 14,850 | 14,776 | 5.92 | |||||||||||||||
| Consumer Finance | ||||||||||||||||||||||
| Golden Pear Funding III, LLC(5) | ||||||||||||||||||||||
| Second Lien Secured Term Loan | L+10.25% (1.00% Floor) | 11.25% | 6/25/20 | 25,000 | 24,797 | 24,732 | 9.92 | |||||||||||||||
| Second Lien Secured Revolving Loan | L+10.25% (1.00% Floor) | 11.25% | 6/25/20 | 5,000 | 4,959 | 4,947 | 1.98 | |||||||||||||||
| Oasis Legal Finance, LLC(5) | ||||||||||||||||||||||
| Second Lien Secured Term Loan | L+10.75% (1.00% Floor) | 11.75% | 3/1/22 | 20,000 | 19,623 | 19,650 | 7.88 | |||||||||||||||
| Sigue Corporation(4) | ||||||||||||||||||||||
| Second Lien Secured Term Loan | L+11.00% (1.00% Floor) | 12.00% | 12/27/18 | 25,000 | 24,801 | 24,200 | 9.70 | |||||||||||||||
| 75,000 | 74,180 | 73,529 | 29.48 | |||||||||||||||||||
WhiteHorse Finance, Inc.
Consolidated Schedule of Investments – (continued)
December 31, 2016
(in thousands)
| Investment Type(1) | Spread Above Index(2) | Interest Rate(3) | Maturity Date | Principal Amount | Amortized Cost | Fair Value | Fair Value As A Percentage Of Net Assets | |||||||||||||||
| Data Processing & Outsourced Services | ||||||||||||||||||||||
| Future Payment Technologies, L.P. | ||||||||||||||||||||||
| First Lien Secured Term Loan | L+8.25% (1.00% Floor) | 9.25% | 12/23/21 | $ | 23,750 | $ | 23,329 | $ | 23,370 | 9.37 | % | |||||||||||
| Department Stores | ||||||||||||||||||||||
| Mills Fleet Farm Group, LLC | ||||||||||||||||||||||
| Second Lien Secured Term Loan | L+9.75% (1.00% Floor) | 10.75% | 2/26/23 | 7,146 | 7,017 | 7,146 | 2.87 | |||||||||||||||
| Distributors | ||||||||||||||||||||||
| 360 Holdings III Corp. | ||||||||||||||||||||||
| First Lien Secured Term Loan | L+9.00% (1.00% Floor) | 10.00% | 10/1/21 | 9,875 | 9,549 | 9,875 | 3.96 | |||||||||||||||
| Diversified Support Services | ||||||||||||||||||||||
| Sitel Worldwide Corporation | ||||||||||||||||||||||
| Second Lien Secured Term Loan | L+9.50% (1.00% Floor) | 10.50% | 9/18/22 | 8,670 | 8,528 | 8,462 | 3.39 | |||||||||||||||
| Electronic Equipment & Instruments | ||||||||||||||||||||||
| AP Gaming I, LLC(4) | ||||||||||||||||||||||
| First Lien Secured Term Loan | L+8.25% (1.00% Floor) | 9.25% | 12/20/20 | 9,700 | 9,533 | 9,523 | 3.82 | |||||||||||||||
| Food Retail | ||||||||||||||||||||||
| AG Kings Holdings, Inc. | ||||||||||||||||||||||
| First Lien Secured Term Loan | L+9.95% (1.00% Floor) | 10.95% | 8/10/21 | 13,930 | 13,375 | 13,610 | 5.46 | |||||||||||||||
| Crews of California, Inc. | ||||||||||||||||||||||
| First Lien Secured Term Loan | L+11.00% (1.00% Floor) | 12.00% (1.00% PIK) | 11/20/19 | 17,538 | 17,343 | 17,461 | 7.00 | |||||||||||||||
| First Lien Secured Revolving Loan | L+11.00% (1.00% Floor) | 12.00% (1.00% PIK) | 11/20/19 | 5,068 | 4,992 | 5,046 | 2.02 | |||||||||||||||
| First Lien Secured Delayed Draw Term Loan | L+11.00% (1.00% Floor) | 12.00% (1.00% PIK) | 11/20/19 | 5,083 | 5,012 | 5,061 | 2.03 | |||||||||||||||
| 41,619 | 40,722 | 41,178 | 16.51 | |||||||||||||||||||
| Health Care Facilities | ||||||||||||||||||||||
| Coastal Sober Living, LLC | ||||||||||||||||||||||
| First Lien Secured Term Loan | L+10.25% (1.00% Floor) | 11.25% | 6/30/19 | 23,183 | 22,964 | 23,183 | 9.30 | |||||||||||||||
WhiteHorse Finance, Inc.
Consolidated Schedule of Investments – (continued)
December 31, 2016
(in thousands)
| Investment Type(1) | Spread Above Index(2) | Interest Rate(3) | Maturity Date | Principal Amount | Amortized Cost | Fair Value | Fair Value As A Percentage Of Net Assets | |||||||||||||||
| Grupo HIMA San Pablo, Inc. | ||||||||||||||||||||||
| First Lien Secured Term Loan | L+9.00% (1.50% Floor) | 10.50% | 1/31/18 | $ | 14,438 | $ | 14,375 | $ | 12,569 | 5.04 | % | |||||||||||
| Second Lien Secured Term Loan | N/A | 15.75% | 7/31/18 | 1,000 | 986 | 594 | 0.24 | |||||||||||||||
| 38,621 | 38,325 | 36,346 | 14.58 | |||||||||||||||||||
| Integrated Telecommunication Services | ||||||||||||||||||||||
| Securus Technologies Holdings, Inc. | ||||||||||||||||||||||
| Second Lien Secured Term Loan | L+7.75% (1.25% Floor) | 9.00% | 4/30/21 | $ | 9,090 | $ | 9,067 | $ | 8,841 | 3.55 | ||||||||||||
| Internet Retail | ||||||||||||||||||||||
| Clarus Commerce, LC | ||||||||||||||||||||||
| First Lien Secured Term Loan | L+11.14% (1.00% Floor) | 12.14% | 3/17/21 | 6,000 | 5,899 | 5,895 | 2.36 | |||||||||||||||
| Office Service & Supplies | ||||||||||||||||||||||
| Katun Corporation | ||||||||||||||||||||||
| Second Lien Secured Term Loan | L+11.25% (1.00% Floor) | 12.25% | 1/25/21 | 5,000 | 4,970 | 4,930 | 1.98 | |||||||||||||||
| Oil & Gas Drilling | ||||||||||||||||||||||
| ProPetro Services, Inc.(4) | ||||||||||||||||||||||
| First Lien Secured Term Loan | L+6.25% (1.00% Floor) | 7.25% | 9/30/19 | 8,284 | 8,246 | 7,189 | 2.88 | |||||||||||||||
| Oil & Gas Exploration & Production | ||||||||||||||||||||||
| Caelus Energy Alaska O3, LLC | ||||||||||||||||||||||
| Second Lien Secured Term Loan | L+7.50% (1.25% Floor) | 8.75% | 4/15/20 | 13,000 | 12,898 | 9,939 | 3.99 | |||||||||||||||
| Other Diversified Financial Services | ||||||||||||||||||||||
| The Pay-O-Matic Corp. | ||||||||||||||||||||||
| First Lien Secured Term Loan | L+11.00% (1.00% Floor) | 12.00% | 4/2/18 | 8,934 | 8,860 | 8,904 | 3.57 | |||||||||||||||
| Research & Consulting Services | ||||||||||||||||||||||
| Project Time & Cost, LLC(4) | ||||||||||||||||||||||
| First Lien Secured Term Loan | L+11.00% (0.74% Floor) | 12.74% | 10/9/20 | 10,105 | 9,953 | 9,845 | 3.95 | |||||||||||||||
WhiteHorse Finance, Inc.
Consolidated Schedule of Investments – (continued)
December 31, 2016
(in thousands)
| Investment Type(1) | Spread Above Index(2) | Interest Rate(3) | Maturity Date | Principal Amount | Amortized Cost | Fair Value | Fair Value As A Percentage Of Net Assets | |||||||||||||||
| Specialized Consumer Services | ||||||||||||||||||||||
| Pre-Paid Legal Services, Inc.(4) | ||||||||||||||||||||||
| Second Lien Secured Term Loan | L+9.00% (1.25% Floor) | 10.25% | 7/1/20 | $ | 19,000 | $ | 18,882 | $ | 19,000 | 7.22 | % | |||||||||||
| Trucking | ||||||||||||||||||||||
| Fox Rent A Car, Inc. | ||||||||||||||||||||||
| Second Lien Secured Term Loan | L+12.00% (0.62% Floor) | 12.62% | 9/30/17 | 7,500 | 7,455 | 7,410 | 2.97 | |||||||||||||||
| Sunteck/TSS Holdings, LLC | ||||||||||||||||||||||
| Second Lien Secured Term Loan | L+9.00% (1.00% Floor) | 10.00% | 6/15/22 | 3,500 | 3,439 | 3,454 | 1.38 | |||||||||||||||
| 11,000 | 10,894 | 10,864 | 4.35 | |||||||||||||||||||
| Total Debt Investments | 393,581 | 386,871 | 381,111 | 152.88 | ||||||||||||||||||
| Equity Investments | ||||||||||||||||||||||
| Advertising | ||||||||||||||||||||||
| IDI, Inc. Warrants(4) | N/A | N/A | 12/8/25 | — | — | — | — | |||||||||||||||
| Food Retail | ||||||||||||||||||||||
| Crews of California, Inc. Warrants(4) | N/A | N/A | 12/31/24 | — | — | 2,426 | 0.97 | |||||||||||||||
| Nicholas & Associates, LLC Warrants(4) | N/A | N/A | 12/31/24 | — | — | 417 | 0.17 | |||||||||||||||
| Pinnacle Management Group, LLC Warrants(4) | N/A | N/A | 12/31/24 | — | — | 871 | 0.35 | |||||||||||||||
| RC3 Enterprises, LLC Warrants(4) | N/A | N/A | 12/31/24 | — | — | 232 | 0.09 | |||||||||||||||
| — | — | 3,946 | 1.58 | |||||||||||||||||||
| Other Diversified Financial Services | ||||||||||||||||||||||
| Artec Group, Inc.(5)(5) | N/A | N/A | N/A | — | 20,693 | 7,505 | 3.01 | |||||||||||||||
| Specialized Finance | ||||||||||||||||||||||
| NMFC Senior Loan Program I LLC Units(5)(6) | N/A | N/A | 6/10/19 | — | 20,120 | 18,993 | 7.62 | |||||||||||||||
| Trucking | ||||||||||||||||||||||
| Fox Rent A Car, Inc. Warrants(4) | N/A | N/A | N/A | — | — | 162 | 0.06 | |||||||||||||||
| Total Equity Investments | — | 40,813 | 30,606 | 12.21 | ||||||||||||||||||
| Total Investments | $ | 393,581 | $ | 427,684 | $ | 411,714 | 165.09 | % | ||||||||||||||
| (1) | Except as otherwise noted, all investments are non-controlled/non-affiliate investments as defined by the Investment Company Act of 1940, as amended (the “1940 Act”), and provide collateral for the Company’s credit facility. |
| (2) | The investments bear interest at a rate that may be determined by reference to the London Interbank Offered Rate (“LIBOR” or “L”) or the Prime Rate (“P”), which resets monthly, quarterly or semiannually. |
| (3) | The interest rate is the “all-in-rate” including the current index and spread, the fixed rate, and the payment-in-kind (“PIK”) interest rate, as the case may be. |
| (4) | The investment or a portion of the investment does not provide collateral for the Company’s credit facility. |
| (5) | Not a qualifying asset under Section 55(a) of the 1940 Act. Under the 1940 Act, the Company may not acquire any non- qualifying asset unless, at the time the acquisition is made, qualifying assets represent at least 70% of total assets. Qualifying assets represent 83% of total assets. |
| (6) | Investment is a non-controlled/affiliate investment as defined by the 1940 Act. |