WhiteHorse Finance, Inc.

Your program is about to begin. If you require assistance throughout the event today, please press star zero. Good afternoon. My name is Chloe, and I will be your conference operator today. At this time, I would like to welcome everyone to the White Horse Finance Third Quarter 2024 Earnings Conference Call. Our hosts for today's call are Stuart Aronson, Chief Executive Officer, and Joyston Thomas, Chief Financial Officer. Today's call is being recorded and will be made available for replay beginning at 4 p.m. Eastern Time. The replay dial-in number is 402-220-2572. No passcode required. At this time, all participants have been placed in a listen-only mode, and the floor will be open for your questions following the presentation. If you would like to ask a question at that time, please press star 1 on your telephone keypad. If you wish to remove yourself from the queue, press star 2. It is now my pleasure to turn the floor over to Robert Brinberg of Rosen Company. Please go ahead.

Thank you, Chloe, and thank you, everyone, for joining us today to discuss Whitehorse Finance's third quarter 2025 earnings results. Before we begin, I'd like to remind everyone that certain statements which are not based on historical facts made during this call, including any statements relating to financial guidance, may be deemed forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Because these forward-looking statements involve known and unknown risks and uncertainties, these are important factors that can cause actual results to differ materially from those expressed or implied by these forward-looking statements. Whitehorse Finance assumes no obligation or responsibility to update any forward-looking statements. Today's speakers may refer to material from the Whitehorse Finance third quarter 2025 earnings presentation, which was posted on our website this morning. With that, allow me to introduce Whitehorse Finance's CEO, Stuart Aronson. Stuart, you may begin.

Thank you, Rob, and good afternoon, everybody. Thank you for joining us today. As you're aware, we issued our earnings this morning before market opened, and I hope you've had a chance to review our results for the period ending September 30th, 2025, which can also be found on our website. On today's call, I will begin by addressing our third quarter results. and current market conditions. Joyce and Thomas, our Chief Financial Officer, will then discuss our performance in greater detail, after which we will open the floor for questions. Our results for the third quarter of 2025 were disappointing and reflect the onset of interest rate cuts, continued pressure on market spreads, as well as the impact of material markdowns on some credits that we have previously discussed. Q3 gap net investment income in core NII was 6.1 million or 26.3 cents per share, compared with Q2 gap in core NII of 6.6 million or 28.2 cents per share. NAV per share at the end of Q3 was $11.41, representing approximately a 3.6% decrease from the prior quarter. In addition to the approximate $0.12 shortfall in NII coverage of our Q3 base distribution, NAV per share was also impacted by net realized and unrealized losses in our portfolio, totaling $6.7 million, or approximately $0.29 per share, which I'll discuss later in the call. As a result of these earnings and current market conditions, I have three important announcements. Given the current earnings power of the BDC, as well as our expectations for lower interest rates and continued spread compression in challenging market conditions, our Board of Directors has taken the prudent measure to reset our quarterly base distribution to 25 cents per share. This adjusted distribution rate represents an implied 8.8% annualized yield based on the company's ending NAV per share as of the end of the third quarter. This was a difficult but necessary decision. Ultimately, we believe the reset puts us in a better position to earn our base distribution going forward, given management's expected earnings power of the BDC, future base rate movements, as well as current market conditions. We will continue our distribution policy framework that was previously announced during our Q1 2023 earnings call on May 9th, 2023, where the company intends to distribute its base distribution as well as make potential supplemental distributions above the base level in the future pursuant to this distribution policy. To the extent our non-accrual and other troubled situations in our portfolio result in recoveries, or if current market conditions improve and or base rates increase, and any of these factors lead to additional earnings, we will be prepared to share those incremental earnings with investors in the form of supplemental or special distributions. Joyson will provide a refresher on how our supplemental distribution policy gets calculated when he speaks in a little while. Second, on the big topics, as a result of recent disappointing results and as a part of our ongoing commitment to align interest to the advisor with those of our shareholders, The advisor has voluntarily agreed to reduce the incentive fee on net investment income from its stated annual rate of 20% to 17.5% for the next two fiscal quarters ending December 31st, 2025 and March 31st, 2026, respectively. This temporary two and a half point reduction in our income-based incentive fee will provide additional financial support for our quarterly distributions to shareholders. The advisor may extend this voluntary reduction. However, the duration and extent of future reductions are uncertain and will be subject to ongoing discussions with the board. Finally, given the discount of the company's stock price relative to its book value, the board has approved a share buyback program of up to $15 million. Under the share repurchase program, the company may but is not obligated to repurchase this outstanding common stock in the open market from time to time at the then current market prices at the discretion of Whitehorse Finances management team. The company's current share price level implies a discount to its current book value of more than 40%, which we believe will result in very accretive share repurchases. Turning now to portfolio activity, we had gross deployments of 19.3 million in Q3, which was more than offset by elevated repayments and sales of 50.5 million, resulting in net repayments of 31.2 million. Gross capital deployments consisted of two new originations, totaling 14.3 million, and the remaining amounts were deployed to fund two add-ons to existing investments. In addition, there was a half a million in net fundings made on revolver commitments. Our new originations in Q3 included one non-sponsor and one sponsor deal at an average leverage of approximately three and a half times EBITDA. All of our Q3 deals were first lien loans at an average spread of 612 basis points. Total repayments and sales were driven by complete or partial realizations in five portfolio positions, including barbecue guys, lab logistics, power plant services, coastal TV, and Ross Simon. At the end of Q3, 99.2% of our debt portfolio was first lien, senior secured, and our portfolio ownership mix was approximately 65% sponsor and 35% non-sponsor. The weighted average effective yield on our income producing debt investments decreased to 11.6% as of the end of Q3, compared to 11.9% in Q2, mainly due to lower spreads and lower base rates. The weighted average effective yield on our overall portfolio also decreased slightly to 9.5% at the end of Q3 compared to approximately 9.8% at the end of Q2. During the quarter, the BDC transferred one new deal and four existing investments to the SDRS-JV. At the end of Q3, the SDRS-JV portfolio had an aggregate fair value of 341.5 million and an average effective yield of 10.3% compared with 10.6% from Q2. We continue to successfully utilize the STRS-JV and believe Whitehorse Finance's equity investment in the JV continues to provide attractive returns for our shareholders. After net repayments and JV transfers activity, as well as the net realized and unrealized losses, recognized during the quarter. Total investments decreased from the prior quarter by 60.9 million to 568.4 million. This compares to our portfolio's fair value of 629.3 million at the end of Q2. During the quarter, we recognized 1.8 million in net realized losses and approximately 4.9 million of net unrealized losses for an aggregate total of 6.7 million in net realized and unrealized losses in Q3. Our mark to market losses were primarily driven by write downs in Alveria, which was formerly known as Aspect Software and in Camarillo Fitness, also formerly known as Honors Holdings. Alveria has continued to underperform and has struggled to service its existing debt levels. At the end of the third quarter, we marked down our position in Alveria by approximately 1.7 million based on our expectations of a multi-tiered restructuring to occur in Q4. Subsequent to the quarter end, a lender group, including Whitehorse, completed a restructuring of the transaction in which we extinguished our existing debt position for cash and equity consideration equal to approximately the aggregate fair value we marked to as of the end of September 30th. Camarilla Fitness, which is the largest franchisee of Orange Theory Fitness, also continues to underperform. At the end of the third quarter, we marked down our position by approximately 4.4 million in the aggregate. We're making every effort to optimize Camarillo to be well positioned for new year signup period, which could give the business a boost in performance. As a partial offset to the markdowns this quarter, we were able to provide an incremental add on to motivational marketing subsequent to the end of the quarter to help effectuate the merging of that portfolio company with another portfolio company. As part of the add-on, the sponsor contributed a fresh amount of additional equity cushion behind the debt. And as a result, that has taken leverage of motivational marketing down significantly and led to a slight markup of approximately 0.7 million on that asset. The BDC also recognized 2.1 million in realized losses, which was partially offset by a reversal of approximately 1.7 million in previously recorded unrealized losses from the restructuring of MSI information systems. With the restructuring of MSI, the restructured debt investments returned back to accrual status as we expected it would. Non-accrual investments now represent 2.7 percent of the debt portfolio at fair value, an improvement compared with 4.9 percent of the debt portfolio. in the prior quarter. Other deals on non-accrual are likely to remain that way for some period of time. We are continuing to actively work on getting deals off non-accrual, leveraging the expertise of our five-person dedicated Whitehorse restructuring team and the resources of HIG Capital. Aside from the credits on non-accrual, our portfolio is performing quite well. Turning to the lending market, M&A activity is not picked up as much as the investment banks and private equity shops had hoped for, although there has been a steady trickle of improvement. There is still plenty of capital available to serve the reduced supply of new financings in the market, and the environment remains extremely competitive, particularly for companies that are non-cyclical and do not have meaningful international sales exposure. Lenders in the sponsor markets are being very aggressive, while the non-sponsor markets continue to be less competitive. In the mid-market, pricing for sponsor deals is pretty solidly in the SOFR 450 to 500 range, as competition is compressed spreads, and OID is typically a point to a point and a half. Lower mid-market sponsor deals are pricing in the 475 to 575 spread over SOFR, at least a range of that. Leverage multiples are between four and six times. And partial pick features are being used selectively to make cash flows work on upper mid-cap and large-cap deals. The non-sponsor market remains much less competitive and has a significant pricing premium compared to the sponsor market. We are generally seeing non-sponsor deals pricing at so far plus 600 and above. OID is still generally two points or higher compared to sponsor deals. Leverage levels on non-sponsor deals have been consistently lower and more stable than the sponsor-backed deals. To put the attractiveness of the non-sponsor market in context, our non-sponsor mandates are still levered only three to five and a half times, and the highest deal we have priced recently is at SOFR 650 plus a warrant. We continue to focus significant resources on the non-sponsor market where there are better risk returns in many cases and much less competition than what we were seeing, especially in the on-the-run sponsor market. We currently have 22 originators covering 13 regional markets. Given market conditions, these originators are primarily focused on sourcing off-the-run sponsor deals and non-sponsor deals as we look for value and good risk return in a market where there was limited deal flow and a lot of aggressiveness. Subsequent to quarter end, the BDC is closed on one new deal and one add-on investment totaling $16.2 million and had one full repayment totaling $22.2 million. Following the net deployment activity to date in Q4, the BDC's remaining capacity is approximately $40 million and pro forma for several transactions that we anticipate to close, in Q4 of 2025, the BDC's capacity for new assets is approximately 20 million. At the end of the third quarter, the STRS-JV's remaining capacity was approximately 20 million, and pro forma for recently mandated deals to eventually be transferred in, the JV's capacity is fully deployed. Our pipeline remains lower than normal for this time of year. We currently have six new mandates and are working on three add-ons to existing deals. Our six mandates are comprised of two non-sponsor deals and four sponsor deals. While there can be no assurances that any of these deals will close, all of these credits would fit into the BDC or our JV should we elect to transact. All of the non-sponsor mandates have pricing of 600 over SOFR or better and would be targeted to go into the BDC's balance sheet. Several of these mandates are large and will help us with asset balances in the BDC. The sponsor mandates have pricing of 425 to 550 over SOFR. With that, I'll turn the call over to Joycen for additional performance details and a review of our portfolio composition. Joycen?