EX-99.1 2 tm2115375d1_ex99-1.htm EXHIBIT 99.1

 

Exhibit 99.1

 

WhiteHorse Finance, Inc. Announces First Quarter 2021 Earnings Results and Declares Quarterly Distribution of $0.355 Per Share

 

NEW YORK, NY, May 10, 2021 – WhiteHorse Finance, Inc. (“WhiteHorse Finance” or the “Company”) (Nasdaq: WHF) today announced its financial results for the quarter ended March 31, 2021. Additionally, the Company announced that its board of directors has declared a distribution of $0.355 per share with respect to the quarter ending June 30, 2021. The distribution will be payable on July 2, 2021 to stockholders of record as of June 18, 2021.

 

First Quarter 2021 Summary Highlights

•Net Asset Value of $314.3 million, or $15.27 per share
•Investment portfolio(1) totaling $617.0 million
•STRS JV investment portfolio totaling $185.7 million
•Gross investment deployments(2) of $57.7 million for the first quarter, including new originations of $45.9 million and $11.8 million of fundings for add-ons to existing investments
•Net investment income of $7.6 million, or $0.370 per share
•Core net investment income(3) of $7.7 million, or $0.375 per share
•First quarter distribution of $0.355 per share

 

(1) Includes investments in WHF STRS Ohio Senior Loan Fund LLC (“STRS JV”), an unconsolidated joint venture, totaling $55.4 million, at fair value.

(2) Excludes investments made in STRS JV.

(3) “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 (i) the net impact of costs associated with the refinancing of the Company’s indebtedness, (ii) the accrual of the capital gains incentive fee attributable to net realized and unrealized gains and losses, and (iii) excise and other income taxes related to such net realized gains and losses (net of incentive fees). 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. Additional information on core net investment income and a reconciliation of core net investment income to its most directly comparable GAAP financial measure, net investment income, are set forth in Schedule 1 hereto.

 

Stuart Aronson, WhiteHorse Finance’s Chief Executive Officer commented, “We had a very active quarter in what is usually a seasonally slow period for transaction activities, successfully originating 5 first lien loans while having 10 complete realizations. This increased our allocation to first-lien senior secured loans to comprise 97 percent of our debt portfolio. Our leverage ratio decreased from the prior quarter-end due to the large realization volume, yet still within the preferrable range of above 1.0x. With the robust pipeline ahead in Q2, we hope to reach our target leverage again in a short amount of time with a strong portfolio under the current improving economic backdrop. We will remain prudent and stay true to our longstanding principles, which we believe drive our goal of enhancing shareholder value.”

 

Portfolio and Investment Activity

 

As of March 31, 2021, the fair value of WhiteHorse Finance’s investment portfolio was $617.0 million, compared with $690.7 million as of December 31, 2020. The portfolio at March 31, 2021 consisted of 90 positions across 62 companies with a weighted average effective yield of 9.6% on income-producing debt investments. The average debt investment size (excluding investments in STRS JV) was $7.1 million with the overall portfolio comprised of approximately 84.7% first lien secured loans, 2.4% second lien secured loans, 3.9% equity and 9.0% in investments in STRS JV. Almost all loans were substantially variable-rate investments (primarily indexed to the London Interbank Offered Rate) with fixed rate securities representing only 0.4% of loans at fair value. Nearly all performing floating rate investments have interest rate floors.

 

During the three months ended March 31, 2021, WhiteHorse Finance made investments in five new portfolio companies totaling $45.9 million and added a total of $11.8 million to seven existing portfolio companies. Proceeds from sales and repayments totaled approximately $110.2 million for the quarter ended March 31, 2021, driven by ten full realizations including AG Kings Holdings Inc., Atlas Intermediate Holdings LLC, Oasis Legal Finance and Ribbon Communications Operating Company, Inc.

 

In addition to the transactions above, during the three months ended March 31, 2021, WhiteHorse Finance transferred assets comprised of four new portfolio companies totaling $28.9 million to STRS JV in exchange for a net investment in STRS JV of $4.3 million as well as cash proceeds of $24.6 million.

 

 

 

 

WHF STRS Ohio Senior Loan Fund LLC

 

As of March 31, 2021, STRS JV’s portfolio totaled $185.7 million, consisted of 22 portfolio companies and had a weighted average effective yield of 8.1% on its portfolio.

 

Results of Operations

 

For the three months ended March 31, 2021, the Company’s net investment income was approximately $7.6 million, compared with approximately $6.1 million for the same periods in the prior year, representing an increase of approximately 24.6%. The increase in net investment income for the year-over-year period was primarily attributable to higher accelerated accretion income recognized due to higher repayment activity and higher investment income generated from the Company’s investment in STRS JV, partially offset by higher incentive fees accrued for the quarter ended March 31, 2021. At March 31, 2021, the Company’s investment in STRS JV was generating an annualized, gross investment yield of approximately 14.8%.

 

For the three months ended March 31, 2021, core net investment income (as defined above) was $7.7 million, compared with $5.5 million for the same period in the prior year, representing an increase of approximately 40.0%.

 

For the three months ended March 31, 2021, WhiteHorse Finance reported net realized and unrealized gains on investments and foreign currency transactions of $0.6 million. This compares with a net realized and unrealized loss on investments and foreign currency transactions of $27.1 million for the three months ended March 31, 2020. The increase for the year-over-year period was primarily attributable to unrealized gains generated on markups in the portfolio as a result of overall market stability and price recovery from the COVID-19 pandemic, in addition to realized gains generated from sales in AG Kings Holdings Inc. and Vero Parent, Inc.

 

WhiteHorse Finance reported a net increase in net assets resulting from operations of approximately $8.2 million for the three months ended March 31, 2021, which compares with a net decrease of $21.0 million for the three months ended March 31, 2020.

 

WhiteHorse Finance’s net asset value was $314.3 million, or $15.27 per share, as of March 31, 2021, as compared with $312.9 million, or $15.23 per share, as of December 31, 2020.

 

Liquidity and Capital Resources

 

As of March 31, 2021, WhiteHorse Finance had cash and cash equivalents of $24.5 million, as compared with $15.9 million as of December 31, 2020, inclusive of restricted cash. As of March 31, 2021, the Company also had $70.4 million of undrawn capacity under its revolving credit facility.

 

Distributions

 

The Company’s board of directors has declared a distribution of $0.355 per share with respect to the quarter ending June 30, 2021. The distribution will be payable on July 2, 2021 to stockholders of record as of June 18, 2021.

 

On March 2, 2021, the Company declared a distribution of $0.355 per share for the quarter ended March 31, 2021, consistent with distributions declared for the thirty-fourth consecutive quarter since the Company’s initial public offering. The distribution was paid on April 5, 2021 to stockholders of record as of March 26, 2021.

 

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 first quarter results at 1:00 p.m. ET on Monday, May 10, 2021. 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 #4287043. Investors may also access the call on the investor relations portion of the Company’s website at www.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 May 24, 2021. The teleconference replay can be accessed by dialing 404-537-3406 (domestic and international) and entering ID #4287043. A webcast replay will also be available on the investor relations portion of the Company’s website at www.whitehorsefinance.com.

 

 

About WhiteHorse Finance, Inc.

 

WhiteHorse Finance is a business development company that originates and invests in loans to privately held, lower middle market companies across a broad range of industries. The Company's investment activities are managed by H.I.G. WhiteHorse Advisers, LLC, an affiliate of H.I.G. Capital, LLC, (“H.I.G. Capital”). H.I.G. Capital is a leading global alternative asset manager with $44 billion of capital under management(4) 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.

 

(4) Based on total capital commitments managed by H.I.G. Capital and affiliates.

 

 

 

SCHEDULE 1 

 

As a supplement to GAAP financial measures, the Company has provided information relating to core net investment income, which is a non-GAAP measure. This measure is provided in addition to, but not as a substitute for, net investment income determined in accordance with GAAP. The Company’s non-GAAP measures may differ from similar measures by other companies, even if similar terms are used to identify such measures. Core net investment income represents net investment income adjusted to exclude the net impact of costs associated with the refinancing of the Company’s indebtedness, the accrual of the capital gains incentive fee attributable to net realized and unrealized gains and losses, and excise or other income taxes related to such net realized gains and losses (net of incentive fees). There were no excise or other income taxes related to net realized gains and losses nor did the Company incur any costs with refinancing any of its indebtedness for the quarters ended March 31, 2021 and March 31, 2020.

 

The following table provides a reconciliation of net investment income to core net investment income for the three months ended March 31, 2021 and March 31, 2020 (in thousands, except per share data):

 

   March 31, 2021   March 31, 2020 
   Amount  

 Per Share

Amounts

   Amount  

 Per Share

Amounts

 
Net investment income  $7,600   $0.370   $6,102   $0.297 
Net impact of costs associated with refinancing of indebtedness   -    -    -    - 
Accrual for capital gains incentive fee   114    0.005    (626)   (0.030)
Net impact of excise tax expense related to net realized gains and losses   -    -    -    - 
Core net investment income  $7,714   $0.375   $5,476   $0.267 

 

 

 

 

WhiteHorse Finance, Inc.

Consolidated Statements of Assets and Liabilities

(in thousands, except share and per share data)

 

   March 31, 2021   December 31, 2020 
   (Unaudited)     
Assets          
Investments, at fair value          
Non-controlled/non-affiliate company investments  $546,264   $623,777 
Non-controlled affiliate company investments   15,283    15,717 
Controlled affiliate company investments   55,440    51,241 
Total investments, at fair value (amortized cost $629,210 and $695,429, respectively)   616,987    690,735 
Cash and cash equivalents   7,701    8,062 
Restricted cash and cash equivalents   16,342    7,549 
Restricted foreign currency (cost of $411 and $319, respectively)   431    333 
Interest and dividend receivable   7,347    6,532 
Amounts receivable on unsettled investment transactions   18,619    4,717 
Escrow receivable   1,939    - 
Receivable for common stock sold   8    - 
Prepaid expenses and other receivables   1,132    1,061 
Total assets  $670,506   $718,989 
           
Liabilities          
Debt  $334,507   $384,880 
Distributions payable   7,307    7,294 
Management fees payable   3,344    3,354 
Incentive fees payable   6,493    6,117 
Amounts payable on unsettled investment transactions   -    497 
Interest payable   2,249    1,870 
Accounts payable and accrued expenses   1,899    1,708 
Unrealized depreciation on foreign currency forward contracts   1    - 
Advances received from unfunded credit facilities   357    372 
Total liabilities   356,157    406,092 
           
Commitments and contingencies          
           
Net assets          
Common stock, 20,583,835 and 20,546,032 shares issued and outstanding, par value $0.001 per share, respectively, and 100,000,000 shares authorized   21    21 
Paid-in capital in excess of par   300,592    300,002 
Accumulated earnings   13,736    12,874 
Total net assets   314,349    312,897 
Total liabilities and total net assets  $670,506   $718,989 
           
Number of shares outstanding   20,583,835    20,546,032 
Net asset value per share  $15.27   $15.23 

  

 

 

 

 WhiteHorse Finance, Inc. 

Consolidated Statements of Operations

(Unaudited) 

(in thousands, except share and per share data)

 

   Three months ended March 31, 
   2021   2020 
Investment income          
From non-controlled/non-affiliate company investments          
Interest income  $14,812   $13,140 
Fee income   771    291 
Dividend income   44    49 
From non-controlled affiliate company investments          
Dividend income   250    275 
From controlled affiliate company investments          
Interest income   719    625 
Dividend income   1,374    153 
Total investment income   17,970    14,533 
           
Expenses          
Interest expense   3,802    3,668 
Base management fees   3,344    3,092 
Performance-based incentive fees   2,042    441 
Administrative service fees   171    171 
General and administrative expenses   821    881 
Total expenses   10,180    8,253 
Net investment income before excise tax   7,790    6,280 
Excise tax   190    178 
Net investment income after excise tax   7,600    6,102 
           
Realized and unrealized gains (losses) on investments and foreign currency transactions          
Net realized gains (losses)          
Non-controlled/non-affiliate company investments   8,160    510 
Non-controlled affiliate company investments   -    - 
Foreign currency transactions   1    (3)
Foreign currency forward contracts   -    6 
Net realized gains (losses)   8,161    513 
Net change in unrealized appreciation (depreciation)          
Non-controlled/non-affiliate company investments   (6,975)   (22,196)
Non-controlled affiliate company investments   (434)   (2,001)
Controlled affiliate company investments   (120)   (3,953)
Translation of assets and liabilities in foreign currencies   (62)   580 
Foreign currency forward contracts   (1)   (1)
Net change in unrealized appreciation (depreciation)   (7,592)   (27,571)
Net realized and unrealized losses on investments   569    (27,058)
Net increase (decrease) in net assets resulting from operations  $8,169   $(20,956)
           
Per Common Share Data          
Basic and diluted earnings (loss) per common share  $0.40   $(1.01)
Dividends and distributions declared per common share  $0.36   $0.36 
Basic and diluted weighted average common shares outstanding   20,551,565    20,546,032 

 

 

 

  

WhiteHorse Finance, Inc.

Consolidated Schedule of Investments (Unaudited)

March 31, 2021

(in thousands)

 

Investment Type(1)  Spread
Above
Index(2)		  Interest
Rate(3)		   Acquisition Date(10)  Maturity
Date		  Principal/
Share
Amount		   Amortized
Cost		   Fair
Value(11)		   Fair Value
As A
Percentage
of Net
Assets		 
North America                                  
Debt Investments                                  
Advertising                                  
SmartSign Holdings LLC                                  
First Lien Secured Term Loan  L+ 7.50%   8.50%  08/21/20  10/11/24   7,724   $7,593   $7,724    2.46%
   (1.00% Floor)                               
Air Freight & Logistics                                  
Access USA Shipping, LLC                                  
First Lien Secured Term Loan  L+ 8.00%   9.50%  02/08/19  02/08/24   5,286    5,241    5,286    1.68 
   (1.50% Floor)                               
Application Software                                  
Connexity, Inc.                                  
First Lien Secured Term Loan  L+ 8.50%   10.00%  05/21/20  05/21/25   10,794    10,486    10,794    3.43 
   (1.50% Floor)                               
Newscycle Solutions, Inc.                                  
First Lien Secured Term Loan  L+ 7.00%   8.00%  06/14/19  12/29/22   3,237    3,205    3,185    1.01 
   (1.00% Floor)                               
First Lien Secured Revolving Loan(7)  L+ 7.00%   8.00%  06/14/19  12/29/22   145    143    141    0.04 
   (1.00% Floor)                               
 TaxSlayer LLC                                  
First Lien Secured Term Loan  L+ 6.50%   7.50%  12/31/20  12/31/26   6,796    6,666    6,666    2.12 
   (1.00% Floor)                               
First Lien Secured Revolving Loan(7)  L+ 6.50%   7.50%  12/31/20  12/31/26   -    -    -    - 
   (1.00% Floor)                               
                  20,972    20,500    20,786    6.60 
Automotive Retail                                  
Team Car Care Holdings, LLC                                  
First Lien Secured Term Loan(12)  Base rate+ 7.99%   9.01%  02/26/18  02/23/23   16,007    15,870    15,650    4.98 
   (1.00% Floor)                               

 

 

 

 

  

WhiteHorse Finance, Inc.

Consolidated Schedule of Investments (Unaudited)

March 31, 2021

(in thousands)

 

Building Products                                  
Drew Foam Companies Inc                                  
First Lien Secured Term Loan  L+ 6.50%   7.50%  12/15/20  11/05/25   7,261    7,124    7,127    2.27 
   (1.00% Floor)                               
LHS Borrower, LLC                                  
First Lien Secured Term Loan  L+ 6.75%   7.75%  09/30/20  09/30/25   9,689    9,493    9,550    3.04 
   (1.00% Floor)                               
First Lien Secured Revolving Loan(7)  L+ 6.75%   7.75%  09/30/20  09/30/25   131    128    131    0.04 
   (1.00% Floor)              17,081    16,745    16,808    5.35 
Cable & Satellite                                  
Bulk Midco, LLC                                  
First Lien Secured Term Loan(15)  L+ 7.34%   8.34%  06/08/18  06/08/23   15,000    14,902    14,250    4.53 
   (1.00% Floor)                               
Construction & Engineering                                  
SFP Holding, Inc.                                  
First Lien Secured Delayed Draw Loan(7)  L+ 6.25%   7.25%  01/25/21  01/24/25   1,054    1,039    1,050    0.33 
   (1.00% Floor)                               
First Lien Secured Revolving Loan(7)  L+ 6.25%   7.25%  02/22/21  09/01/23   -    -    1    - 
   (1.00% Floor)                               
Tensar Corp.                                  
First Lien Secured Term Loan  L+ 6.75%   7.75%  11/20/20  08/20/25   6,983    6,821    6,918    2.20 
   (1.00% Floor)                               
                  8,037    7,860    7,969    2.53 
Construction Materials                                  
Claridge Products and Equipment, LLC                                  
First Lien Secured Term Loan  L+ 6.50%   7.50%  12/30/20  12/29/25   7,980    7,828    7,828    2.49 
   (1.00% Floor)                               
First Lien Secured Revolving Loan(7)  L+ 6.50%   7.50%  12/30/20  12/29/25   -    -    -    - 
   (1.00% Floor)              7,980    7,828    7,828    2.49 
Consumer Finance                                  
Maxitransfers Blocker Corp                                  
First Lien Secured Term Loan  L+ 9.00%   10.00%  10/07/20  10/07/25   8,813    8,624    8,725    2.78 
   (1.00% Floor)                               

  

 

 

  

WhiteHorse Finance, Inc.

Consolidated Schedule of Investments (Unaudited)

March 31, 2021

(in thousands)

 

First Lien Secured Revolving Loan(4)(7)  L+ 9.00%   10.00%  10/07/20  10/07/25   -    -    12    - 
   (1.00% Floor)              8,813    8,624    8,737    2.78 
                                   
Data Processing & Outsourced Services                                  
Escalon Services Inc                                  
First Lien Secured Term Loan  L+13.50%   14.50%  12/04/20  12/04/25   8,014    7,346    7,379    2.35 
   (1.00% Floor)   (1.50%PIK)                          
FPT Operating Company, LLC/                                  
TLabs Operating Company, LLC                                  
First Lien Secured Term Loan  L+ 8.25%   9.25%  12/23/16  06/07/24   24,467    24,238    24,224    7.71 
   (1.00% Floor)                               
Geo Logic Systems Ltd. (5)                                  
First Lien Secured Term Loan(13)  C +6.50%   7.50%  12/19/19  12/19/24   6,666    5,009    5,198    1.65 
   (1.00% Floor)                               
First Lien Secured Revolving Loan (7)(13)  C +6.50%   7.50%  12/19/19  12/19/24   -    -    (2)   - 
   (1.00% Floor)              39,147    36,593    36,799    11.71 
Department Stores                                  
Mills Fleet Farm Group, LLC                                  
First Lien Secured Term Loan  L+ 6.00%   7.00%  10/24/18  10/24/24   13,543    13,303    13,408    4.27 
   (1.00% Floor)                               
Distributors                                  
Crown Brands, LLC                                  
Second Lien Secured Term Loan(19)  L+ 10.50%   12.00%  12/15/20  01/08/26   4,453    4,353    3,562    1.13 
   (1.50% Floor)                               
Second Lien Secured Delayed Draw Loan(19)  L+ 10.50%   12.00%  12/15/20  01/08/26   661    660    528    0.17 
   (1.50% Floor)              5,114    5,013    4,090    1.30 

  

 

 

  

WhiteHorse Finance, Inc.

Consolidated Schedule of Investments (Unaudited)

March 31, 2021

(in thousands)

 

Diversified Chemicals                                  
Sklar Holdings, Inc.                                  
First Lien Secured Term Loan  L+ 7.75%   8.75%  11/13/19  05/13/23   7,473   $7,346   $7,473    2.38%
   (1.00% Floor)                               
                                   
Diversified Support Services                                  
NNA Services, LLC                                  
First Lien Secured Term Loan  L+ 7.00%   8.50%  10/16/18  10/16/23   13,263    13,105    13,263    4.22 
   (1.50% Floor)                               
Education Services                                  
EducationDynamics, LLC                                  
First Lien Secured Term Loan  L+ 7.75%   8.75%  11/26/19  11/26/24   12,796    12,602    12,789    4.07 
   (1.00% Floor)                               
Health Care Facilities                                  
Epiphany Dermatology                                  
First Lien Secured Term Loan  L+ 7.50%   8.50%  12/04/20  06/22/23   3,491    3,415    3,456    1.10 
   (1.00% Floor)                               
First Lien Secured Revolving Loan (7)  L+ 7.50%   8.50%  12/04/20  06/22/23   -    -    5    - 
   (1.00% Floor)                               
First Lien Secured Delayed Draw Loan (7)  L+ 7.50%   8.50%  12/04/20  06/22/23   -    -    36    0.01 
   (1.00% Floor)                               
Grupo HIMA San Pablo, Inc.                                  
First Lien Secured Term Loan A (8)  L+ 9.00%   9.22%  05/15/19  04/30/19   3,855    3,855    2,147    0.68 
                                   
First Lien Secured Term Loan B(8)  L+ 9.00%   10.50%  02/01/13  04/30/19   13,511    13,511    7,526    2.39 
   (1.50% Floor)                               

 

 

 

   

WhiteHorse Finance, Inc.

Consolidated Schedule of Investments (Unaudited)

March 31, 2021

(in thousands)

 

Second Lien Secured Term Loan(8)  N/A   15.75%  02/01/13  07/31/18   1,028    1,024    -    - 
       (2.00%PIK)         21,885    21,805    13,170    4.18 
Health Care Services                                  
CHS Therapy, LLC                                  
First Lien Secured Term Loan A  L+ 8.50%   10.00%  06/14/19  06/14/24   7,374    7,284    7,374    2.35 
   (1.50% Floor)                               
First Lien Secured Term Loan C  L+ 8.50%   10.00%  10/07/20  06/14/24   906    891    906    0.29 
   (1.50% Floor)                               
DCA Investment Holding, LLC                                  
First Lien Secured Term Loan  L+ 6.25%   7.00%  03/11/21  03/12/27   7,060    6,955    6,955    2.21 
   (0.75% Floor)                               
First Lien Secured Delayed Draw Loan(7)  L+ 6.25%   L+ 7.00%  03/11/21  03/12/27   -    -    (13)   - 
   (0.75% Floor)                               
Ivy Rehab Holdings LLC                                  
First Lien Secured Term Loan  L+ 6.75%   7.75%  12/04/20  12/04/24   8,833    8,671    8,768    2.79 
   (1.00% Floor)                               
First Lien Secured Revolving Loan (7)  L+ 6.75%   7.75%  12/04/20  12/04/24   -    -    6    - 
   (1.00% Floor)                               
First Lien Secured Delayed Draw Loan (7)  L+ 6.75%   7.75%  12/04/20  12/04/24   155    152    170    0.05 
   (1.00% Floor)                               
Lab Logistics, LLC                                  
First Lien Secured Term Loan  L+ 7.25%   8.25%  10/16/19  11/19/25   1,164    1,141    1,151    0.37 
   (1.00% Floor)                               
First Lien Secured Delayed Draw Loan  L+ 7.25%   8.25%  10/16/19  09/25/23   5,223    5,198    5,223    1.66 
   (1.00% Floor)                               
PG Dental New Jersey Parent, LLC                                  
First Lien Secured Term Loan  L+ 7.75%   8.75%  11/25/20  11/25/25   16,130    15,792    15,830    5.04 
   (1.00% Floor)                               

 

 

 

   

WhiteHorse Finance, Inc.

Consolidated Schedule of Investments (Unaudited)

March 31, 2021

(in thousands)

 

First Lien Secured Revolving Loan (7)  L+ 7.75%   8.75%  11/25/20  11/25/25   -    -    3    - 
   (1.00% Floor)              46,845    46,084    46,373    14.76 
Home Furnishings                                  
Sure Fit Home Products, LLC                                  
First Lien Secured Term Loan(8)  L+ 9.75%   10.75%  10/26/18  07/13/22   5,243    5,111    4,672    1.49 
   (1.00% Floor)                               
Interactive Media & Services                                  
What If Media Group, LLC                                  
First Lien Secured Term Loan  L+ 7.00%   8.00%  10/02/19  10/02/24   17,561    17,285    17,461    5.55 
   (1.00% Floor)                               
Internet & Direct Marketing Retail                                  
BBQ Buyer, LLC                                  
First Lien Secured Term Loan  L+ 8.00%   9.50%  08/28/20  08/28/25   12,698    12,412    12,753    4.06 
   (1.50% Floor)                               
Clarus Commerce, LLC                                  
First Lien Secured Term Loan  L+ 6.50%   7.50%  03/05/21  07/01/25   1,917    1,879    1,879    0.60 
   (1.00% Floor)                               
Luxury Brand Holdings, Inc.                                  
First Lien Secured Term Loan  L+ 7.00%   8.00%  12/04/20  06/04/26   5,985    5,872    5,926    1.89 
   (1.00% Floor)                               
Potpourri Group, Inc.                                  
First Lien Secured Term Loan  L+ 8.25%   9.75%  07/03/19  07/03/24   18,270    18,003    18,271    5.81 
   (1.50% Floor)              38,870    38,166    38,829    12.36 
Investment Banking & Brokerage                                  
JVMC Holdings Corp. (f/k/a RJO Holdings Corp)                                  
First Lien Secured Term Loan  L+ 7.75%   8.75%  02/28/19  02/28/24   13,381    13,303    13,381    4.26 
   (1.00% Floor)                               

 

 

 

    

WhiteHorse Finance, Inc.

Consolidated Schedule of Investments (Unaudited)

March 31, 2021

(in thousands)

 

IT Consulting & Other Services                                  
AST-Applications Software Technology LLC                                  
First Lien Secured Term Loan  L+ 8.00%   9.00%  01/10/17  01/10/23   4,004    3,977    4,004    1.27 
   (1.00% Floor)   (1.00%PIK)                          
Core BTS, Inc.                                  
First Lien Secured Term Loan  L+ 6.75%   8.25%  02/01/21  08/30/25   3,333    3,269    3,269    1.04 
   (1.50% Floor)                               
First Lien Secured Delayed Draw Loan (7)  L+ 6.75%   8.25%  02/01/21  08/30/25   -    -    (16)   - 
   (1.50% Floor)              7,337    7,246    7,257    2.31 
Leisure Facilities                                  
Honors Holdings, LLC                                  
First Lien Secured Term Loan (16)  L+ 8.48%   9.48%  09/06/19  09/06/24   9,651    9,502    8,878    2.82 
   (1.00% Floor)   (1.00%PIK)                          
First Lien Secured Delayed Draw Loan(16)  L+ 8.11%   9.11%  09/06/19  09/06/24   4,750    4,704    4,370    1.39 
   (1.00% Floor)   (1.00%PIK)                          
Lift Brands, Inc. (aka Snap  Fitness Holdings, Inc.)                                  
First Lien Secured Term Loan A  L+ 7.50%   8.50%  06/29/20  06/29/25   5,659    5,585    5,572    1.77 
   (1.00% Floor)                               
First Lien Secured Term Loan B  N/A   9.50%  06/29/20  06/29/25   1,191    1,167    1,160    0.37 
       (9.50%PIK)                          
First Lien Secured Term Loan C (9)  N/A   9.50%  06/29/20  NA   1,268    1,265    1,264    0.40 
       (9.50%PIK)         22,519    22,223    21,244    6.75 

  

 

 

  

WhiteHorse Finance, Inc.

Consolidated Schedule of Investments (Unaudited)

March 31, 2021

(in thousands)

 

Office Services & Supplies                                  
Empire Office, Inc.                                  
First Lien Secured Term Loan  L+ 6.75%   8.25%  04/12/19  04/12/24   10,577   $10,449   $10,341    3.29%
   (1.50% Floor)                               
Packaged Foods & Meats                                  
Lenny & Larry's, LLC                                  
First Lien Secured Term Loan(17)  L+ 8.41%   9.41%  05/15/18  05/15/23   10,997    10,907    10,513    3.34 
   (1.00% Floor)   (1.72%PIK)                          
Personal Products                                  
Inspired Beauty Brands, Inc.                                  
First Lien Secured Term Loan  L+ 7.00%   8.00%  12/30/20  12/31/25   12,547    12,308    12,308    3.92 
   (1.00% Floor)                               
First Lien Secured Revolving Loan (7)  L+ 7.00%   8.00%  12/30/20  12/31/25   -    -    -    - 
   (1.00% Floor)              12,547    12,308    12,308    3.92 
Property & Casualty Insurance                                  
Policy Services Company, LLC (5)                                  
First Lien Secured Term Loan  L+ 6.00%   7.00%  03/06/20  05/31/24   6,224    5,990    6,100    1.94 
   (1.00% Floor)                               
Research & Consulting Services                                  
Comniscient Technologies LLC                                  
First Lien Secured Term Loan  L+ 7.50%   8.50%  10/13/20  10/13/25   6,945    6,819    6,945    2.21 
   (1.00% Floor)                               
First Lien Secured Revolving Loan (7)  L+ 7.50%   8.50%  10/13/20  10/13/25   -    -    7    - 
   (1.00% Floor)                               
Nelson Worldwide, LLC                                  
First Lien Secured Term Loan  L+ 9.25%   10.25%  01/09/18  01/09/23   10,972    10,875    10,862    3.46 
   (1.00% Floor)                               

 

 

 

   

WhiteHorse Finance, Inc.

Consolidated Schedule of Investments (Unaudited)

March 31, 2021

(in thousands)

 

ALM Media, LLC                                  
First Lien Secured Term Loan  L+ 7.00%   8.00%  11/25/19  11/25/24   14,766    14,550    14,323    4.56 
   (1.00% Floor)              32,683    32,244    32,137    10.23 
Restaurants                                  
LS GFG Holdings Inc.                                  
First Lien Secured Term Loan  L+ 8.00%   9.00%  11/30/18  11/19/25   10,879    10,147    10,227    3.25 
   (1.00% Floor)   (2.00%PIK)                          
Specialized Consumer Services                                  
True Blue Car Wash, LLC                                  
First Lien Secured Term Loan  L+ 7.12%   8.12%  10/17/19  10/17/24   4,321    4,259    4,321    1.37 
   (1.00% Floor)                               
First Lien Secured Delayed Draw Loan(7)  L+ 7.12%   8.12%  10/17/19  10/17/24   2,002    1,985    2,017    0.64 
   (1.00% Floor)              6,323    6,244    6,338    2.01 
Specialized Finance                                  
Golden Pear Funding Assetco, LLC(5)                                  
Second Lien Secured Term Loan  L+ 10.50%   11.50%  09/20/18  03/20/24   10,938    10,819    10,938    3.48 
   (1.00% Floor)                               
WHF STRS Ohio Senior Loan Fund LLC                                  
Subordinated Note(4)(5)(7)(9)(14)  L+ 6.50%   6.61%  07/19/19  N/A   44,529    44,529    44,529    14.17 
                  55,467    55,348    55,467    17.65 
Specialty Chemicals                                  
Flexitallic Group SAS                                  
First Lien Secured Term Loan  L+ 6.50%   7.50%  10/28/19  10/29/26   11,603    11,370    10,802    3.44 
   (1.00% Floor)                               
Systems Software                                  
Arcstor Midco, LLC                                  
First Lien Secured Term Loan  L+ 7.00%   8.00%  03/16/21  03/16/27   19,500    19,113    19,112    6.08 
   (1.00% Floor)                               
                                   
IDIG Parent LLC                                  
First Lien Secured Term Loan  L+ 6.50%   7.50%  02/17/21  12/15/26   8,547    8,466    8,466    2.69 
   (1.00% Floor)                               
First Lien Secured Delayed Draw Loan(7)  L+ 6.50%   7.50%  02/17/21  12/15/26   -    -    -    - 
   (1.00% Floor)                               

 

 

 

   

WhiteHorse Finance, Inc.

Consolidated Schedule of Investments (Unaudited)

March 31, 2021

(in thousands)

  

First Lien Secured Revolving Loan (7)  L+ 6.50%   7.50%  02/17/21  12/15/26   -    -    -    - 
   (1.00% Floor)              28,047    27,579    27,578    8.77 
Technology Hardware, Storage & Peripherals                                  
Source Code Midco, LLC                                  
First Lien Secured Term Loan  L+ 8.25%   9.25%  05/04/18  05/04/23   22,010    21,745    22,010    7.00 
   (1.00% Floor)                               
Telestream Holdings Corporation                                  
First Lien Secured Term Loan  L+ 8.75%   9.75%  10/15/20  10/15/25   15,193    14,751    14,903    4.74 
   (1.00% Floor)                               
First Lien Secured Revolving Loan (7)  L+ 8.75%   9.75%  10/15/20  10/15/25   -    -    14    - 
   (1.00% Floor)              37,203    36,496    36,927    11.74 
Trading Companies & Distributors                                  
LINC Systems, LLC                                  
First Lien Secured Term Loan  L+ 6.50%   7.50%  02/24/21  02/24/26   8,355    8,191    8,191    2.61 
   (1.00% Floor)                               
First Lien Secured Revolving Loan (7)  L+ 6.50%   7.50%  02/24/21  02/24/26   -    -    -    - 
   (1.00% Floor)              8,355    8,191    8,191    2.61 
                                   
Total Debt Investments                 602,782    591,621    582,176    185.20 
                                   
                                   
Equity Investments                                  
Data Processing & Outsourced Services                                  
Escalon Services Inc Warrants(4)  N/A   N/A   12/04/20  N/A   709    476    475    0.15 
Diversified Support Services                                  
Quest Events, LLC Preferred Units(4)  N/A   N/A   12/28/18  12/08/25   317    317    -    - 
ImageOne Industries, LLC Common A Units(4)  N/A   N/A   09/20/19  N/A   225    -    164    0.05 
                       317    164    0.05 
Health Care Services                                  
Lab Logistics Preferred Units (4)  N/A   N/A   10/29/19  N/A   2    857    857    0.27 

 

 

 

   

WhiteHorse Finance, Inc.

Consolidated Schedule of Investments (Unaudited)

March 31, 2021

(in thousands)

  

Internet & Direct Marketing Retail                                  
BBQ Buyer, LLC Shares(4)  N/A   N/A   08/28/20  N/A   1,100    1,100    2,200    0.70 
Ross-Simons Topco, LP Preferred Units(4)  N/A   N/A   12/04/20  N/A   600    600    600    0.19 
                       1,700    2,800    0.89 
Investment Banking & Brokerage                                  
Arcole Holding Corp.
Shares (4)(5)(6)(18)		  N/A   N/A   10/01/20  N/A   -    6,944    5,713    1.82 
IT Consulting & Other Services                                  
Keras Holdings, LLC Shares(4)  N/A   N/A   12/31/20  N/A   496    496    496    0.16 
Leisure Facilities                                  
 Lift Brands, Inc. (aka Snap Fitness Holdings, Inc.) Class A Common Stock(4)  N/A   N/A   06/29/20  N/A   2    1,955    237    0.08 
 Lift Brands, Inc. (aka Snap Fitness Holdings, Inc.) Warrants(4)  N/A   N/A   06/29/20  06/28/28   1    793    96    0.03 
                       2,748    333    0.11 
Other Diversified Financial Services                                  
SFS Global Holding Company Warrants(4)  N/A   N/A   06/28/18  12/28/25   -    -    -    - 
Sigue Corporation Warrants(4)  N/A   N/A   06/28/18  12/28/25   22    2,890    3,492    1.11 
                       2,890    3,492    1.11 
Specialized Finance                                  
NMFC Senior Loan Program I LLC Units (4)(5)(6)  N/A   N/A   06/10/14  08/31/22   10,000    10,029    9,570    3.04 
WHF STRS Ohio Senior Loan Fund LLC Interests (4)(5)(7)(14)  N/A   N/A   07/19/19  N/A   11,132    11,132    10,911    3.47 
                       21,161    20,481    6.51 
                                   
Total Equity Investments                      37,589    34,811    11.07 
                                   
Total Investments                     $629,210   $616,987    196.27%

  

 

 

  

WhiteHorse Finance, Inc.

Consolidated Schedule of Investments (Unaudited)

March 31, 2021

(in thousands)

 

Forward Currency Contracts

 

   Currency to be   Currency to be      Unrealized   Unrealized 
Counterparty  sold   purchased   Settlement date  appreciation ($)   depreciation ($) 
Morgan Stanley  C$105CAD  $83USD  04/28/2021  $-   $(1)
                $-   $(1)

 

  (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”), which resets monthly, quarterly or semiannually, the Canadian Dollar Offered Rate (“CDOR” or “C”) or the U.S. Prime Rate as published by the Wall Street Journal (“Prime” or “P”). The one, three and six-month LIBOR were 0.1%, 0.2% and 0.2%, respectively, as of March 31, 2021. The Prime was 3.25% as of March 31, 2021. The CDOR was 0.4% as of March 31, 2021.

 

  (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 represented 86% of total assets as of the date of the consolidated schedule of investments.

 

  (6) Investment is a non-controlled/affiliate investment as defined by the 1940 Act.

 

  (7) The investment has an unfunded commitment in addition to any amounts presented in the consolidated schedule of investments as of March 31, 2021.

 

  (8) The investment is on non-accrual status.

 

  (9) Security is perpetual with no defined maturity date.

 

  (10) Except as otherwise noted, all of the Company’s portfolio company investments, which as of the date of the consolidated schedule of investments represented 196% of the Company’s net assets or 92% of the Company’s total assets, are subject to legal restrictions on sales.

 

  (11) The fair value of each investment was determined using significant unobservable inputs.

 

  (12) The investment was comprised of two contracts, which were indexed to different base rates, L and P, respectively. The Spread Above Index and Interest Rate presented represent the weighted average of both contracts.

 

 

 

  

  (13) Principal amount is denominated in Canadian dollars.

  

  (14) Investment is a controlled affiliate investment as defined by the 1940 Act. On January 14, 2019, the Company entered into an agreement with State Teachers Retirement System of Ohio, a public pension fund established under Ohio law (“STRS Ohio”), to create STRS JV, a joint venture, which invests primarily in senior secured first and second lien term loans.

 

  (15) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.75% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.

 

  (16) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 3.50% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.

 

  (17) In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 3.00% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.

 

  (18) On October 1, 2020, as part of a restructuring agreement between the Company and Arcole Acquisition Corp, the Company’s investments in first lien secured term loans to Arcole Acquisition Corp were converted into common shares of Arcole Holding Corp.

 

  (19) At the option of the issuer, interest can be paid in cash or cash and PIK. The issuer may elect to pay up to 2.00% PIK.

 

 

 

 

 

 

 

 

Contacts

 

Stuart Aronson

WhiteHorse Finance, Inc.

212-506-0500

saronson@higwhitehorse.com

 

or

 

Joyson Thomas

WhiteHorse Finance, Inc.

305-379-2322

jthomas@higwhitehorse.com

 

or

 

Sean Silva

Prosek Partners

646-818-9122

ssilva@prosek.com

 

Source: WhiteHorse Finance, Inc.