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TSLX Reminds TICC’s Stockholders that the Status Quo at TICC is Not the Only Option for the Future Should the BSP Transaction Fail
TSLX Stands Ready and Willing to Provide TICC Stockholders with an Immediate, Upfront Premium and the Opportunity to Participate in an Outperforming Platform
TSLX Offer Represents a 17.6% Premium to TICC’s Closing Share Price
The BSP Transaction Unnecessarily Rewards an Underperforming Manager and Pays Conflicted Members of the TICC Board Millions of Dollars
“We remain confident that TICC will soon hear the overwhelming voice of
its stockholders urging TICC to engage with us toward a transaction that
delivers a substantial up-front premium to its stockholders along with
the opportunity to participate in the upside potential of our
outperforming platform. Our offer represents a 17.6% premium to TICC’s
closing share price on
“Given that the BSP Transaction continues to reward a failed manager
through a flawed process, we believe
“ISS’s caution that the TICC status quo would be a negative outcome for stockholders is simply no justification for rewarding a failed manager that has not meaningfully explored alternative proposals and actively misled stockholders to approve an inferior transaction. By arguing that the BSP Transaction should be approved if only to avoid potentially leaving TICC stockholders stuck indefinitely in a status quo, ISS misunderstands the options stockholders have available to them, including under the 1940 Act. Should the BSP Transaction fail, a majority of stockholders would have the ability to terminate the existing advisory agreement without the failed manager receiving any consideration. Furthermore, stockholders would, and should, expect TICC’s board to uphold its fiduciary duties and engage in a credible process to maximize stockholder value. Most importantly, ISS is also wrong to assume that approving the BSP Transaction won’t foreclose other opportunities.”
TSLX disagrees with ISS’s change in recommendation, for the following reasons:
- Since the time of our initial offer, TICC management has presided over an additional 9% reduction in NAV, representing a further erosion of stockholder value, in part driven by an unsustainable dividend policy that includes a return of capital;
- TSLX increased its offer as a percentage of NAV from 87% of NAV to 90% of NAV;
Pro forma for the transaction with TSLX and based on TICC’s closing
share price on
December 18, 2015, each TICC stockholder would be entitled to a dividend of $0.171 per TICC share, which is 30% higher than the sustainable dividend of $0.13they would receive under TICC standalone. This is calculated as follows:
Adjusted for excess leverage, TICC’s Net Investment Income was
$0.142 per share in Q3;
A sustainable dividend level, as represented by 90% of Net
Investment Income, would have been
$0.13per share. For reference, TICC paid out a $0.29per share dividend, an astonishing 226% higher than what a sustainable dividend policy represents; and
- Adjusted for excess leverage, TICC’s Net Investment Income was
- Since inception, TSLX has maintained a sustainable dividend policy based on its ability to generate earnings and not supported by returning capital to stockholders.
TSLX urges TICC stockholders to vote the GOLD proxy card AGAINST proposals related to the BSP Transaction and to visit www.changeTICCnow.com for more information about TSLX’s offer and the deficiencies of management’s proposals. TSLX owns approximately 3% of the outstanding shares of TICC common stock and plans to vote its shares against the proposals recommended by TICC’s board.
Vote the GOLD proxy card AGAINST the proposed BSP Transaction to stop further value destruction at TICC. Hold TICC management accountable for their performance.
Information set forth herein includes forward-looking statements. These
forward-looking statements include, but are not limited to, statements
regarding TSLX proposed business combination transaction with
Such forward-looking statements are inherently uncertain, and
stockholders and other potential investors must recognize that actual
results may differ materially from TSLX’s expectations as a result of a
variety of factors, including, without limitation, those discussed
below. Such forward-looking statements are based upon management’s
current expectations and include known and unknown risks, uncertainties
and other factors, many of which TSLX is unable to predict or control,
that may cause TSLX’s plans with respect to TICC, actual results or
performance to differ materially from any plans, future results or
performance expressed or implied by such forward-looking statements.
These statements involve risks, uncertainties and other factors
discussed below and detailed from time to time in TSLX’s filings with
Risks and uncertainties related to the proposed transaction include, among others, uncertainty as to whether TSLX will further pursue, enter into or consummate the transaction on the terms set forth in the proposal or on other terms, potential adverse reactions or changes to business relationships resulting from the announcement or completion of the transaction, uncertainties as to the timing of the transaction, adverse effects on TSLX’s stock price resulting from the announcement or consummation of the transaction or any failure to complete the transaction, competitive responses to the announcement or consummation of the transaction, the risk that regulatory or other approvals and any financing required in connection with the consummation of the transaction are not obtained or are obtained subject to terms and conditions that are not anticipated, costs and difficulties related to the integration of TICC’s businesses and operations with TSLX’s businesses and operations, the inability to obtain, or delays in obtaining, cost savings and synergies from the transaction, unexpected costs, liabilities, charges or expenses resulting from the transaction, litigation relating to the transaction, the inability to retain key personnel, and any changes in general economic and/or industry specific conditions.
In addition to these factors, other factors that may affect TSLX’s plans, results or stock price are set forth in TSLX’s Annual Report on Form 10-K and in its reports on Forms 10-Q and 8-K.
Many of these factors are beyond TSLX’s control. TSLX cautions investors that any forward-looking statements made by TSLX are not guarantees of future performance. TSLX disclaims any obligation to update any such factors or to announce publicly the results of any revisions to any of the forward-looking statements to reflect future events or developments.
Third Party-Sourced Statements and Information
Certain statements and information included herein have been sourced from third parties. TSLX does not make any representations regarding the accuracy, completeness or timeliness of such third party statements or information. Except as expressly set forth herein, permission to cite such statements or information has neither been sought nor obtained from such third parties. Any such statements or information should not be viewed as an indication of support from such third parties for the views expressed herein. All information in this communication regarding TICC, including its businesses, operations and financial results, was obtained from public sources. While TSLX has no knowledge that any such information is inaccurate or incomplete, TSLX has not verified any of that information. TSLX reserves the right to change any of its opinions expressed herein at any time as it deems appropriate. TSLX disclaims any obligation to update the data, information or opinions contained herein.
Proxy Solicitation Information
The information set forth herein is provided for informational purposes
only and does not constitute an offer to purchase or the solicitation of
an offer to sell any securities. TSLX has filed with the
TSLX STRONGLY ADVISES ALL STOCKHOLDERS OF TICC TO READ THE TSLX PROXY STATEMENT AND ITS OTHER PROXY MATERIALS AS THEY BECOME AVAILABLE BECAUSE THEY CONTAIN IMPORTANT INFORMATION. SUCH TSLX PROXY MATERIALS ARE AND WILL BECOME AVAILABLE AT NO CHARGE ON THE SEC’S WEB SITE AT HTTP://WWW.SEC.GOV AND AT TSLX’S WEBSITE AT HTTP://WWW.TPGSPECIALTYLENDING.COM. IN ADDITION, TSLX WILL PROVIDE COPIES OF THE PROXY STATEMENT WITHOUT CHARGE UPON REQUEST. REQUESTS FOR COPIES SHOULD BE DIRECTED TO TSLX’S PROXY SOLICITOR AT TPG@MACKENZIEPARTNERS.COM.
The participant in the solicitation is TSLX and certain of its directors and executive officers may also be deemed to be participants in the solicitation. As of the date hereof, TSLX directly beneficially owned 1,633,660 shares of common stock of TICC.
Security holders may obtain information regarding the names,
affiliations and interests of TSLX’s directors and executive officers in
TSLX’s Annual Report on Form 10-K for the year ended
1 TSLX offer price based on 90% of most recently reported NAV
per share. TICC stockholders would receive 0.43 shares of TSLX per share
of TICC based on
2 Pro forma net investment income per share calculated as if
TICC had sold assets at fair value and applied the proceeds to repay
outstanding indebtedness to achieve a debt-to-equity ratio at
TPG Specialty Lending
Robert Ollwerther, 212-430-4119
TPG Specialty Lending
Lucy Lu, 212-601-4753
MacKenzie Partners, Inc.
Charlie Koons, 800-322-2885
TPG Specialty Lending
Luke Barrett, 212-601-4752
Tom Johnson or Pat Tucker, 212-371-5999
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