WHF WhiteHorse Finance Inc

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

 

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

 

Date of Report (Date of earliest event reported): August 24, 2023

 

WhiteHorse Finance, Inc.

(Exact name of registrant as specified in its charter)

 

Delaware		814-00967		45-4247759
(State or other jurisdiction		(Commission		(IRS Employer
of incorporation)		File Number)		Identification Number)

 

1450 Brickell Avenue, 31st Floor
Miami, Florida		33131
(Address of principal executive offices)		(Zip Code)

 

(305) 381-6999

(Registrant’s telephone number, including area code)

 

Not Applicable

(Former Name or Former Address, if changed since last report)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

¨	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Securities registered pursuant to Section 12(b) of the Act:

  

Title of Each Class		Trading Symbol(s)		Name of Each Exchange on Which Registered
Common Stock, par value $0.001 per share		WHF		The Nasdaq Stock Market LLC (Nasdaq Global Select Market)

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

 

Emerging growth company   ¨

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.    ¨

 

 

Item 1.01. Entry into a Material Definitive Agreement

 

Indenture

 

On August 24, 2023, WhiteHorse Finance, Inc. (the “Company”) entered into a third supplemental indenture (the “Third Supplemental Indenture”), between the Company and Equiniti Trust Company, LLC (f/k/a American Stock Transfer & Trust Company, LLC), which supplements the base indenture, dated November 13, 2018 (together with the Third Supplemental Indenture, the “Indenture”) pursuant to which the Company offered and sold $30.0 million in aggregate principal amount of its 7.875% notes due 2028 (the “Notes”) in a registered public offering (the “Offering”).

 

The Notes will mature on September 15, 2028 and may be redeemed in whole or in part at any time or from time to time at the Company’s option on or after September 15, 2025. The Notes bear interest at a rate of 7.875% per year payable quarterly on March 15, June 15, September 15 and December 15 of each year, commencing September 15, 2023. The Notes will be the Company’s direct, unsecured obligations and will rank pari passu in right of payment with the Company’s current and future unsecured unsubordinated indebtedness, senior to any of the Company’s future indebtedness that expressly states it is subordinated in right of payment to the Notes, effectively subordinated in right of payment to all of the Company’s existing and future secured indebtedness (including indebtedness that is initially unsecured, but to which the Company subsequently grants security) to the extent of the value of the assets securing such indebtedness, and structurally subordinated to all existing and future indebtedness and other obligations of any of the Company’s subsidiaries, financing vehicles, or similar facilities. The Company expects the Notes to begin trading on the Nasdaq Global Select Market within 30 days of the original issue date.

 

The Indenture contains certain covenants, including covenants requiring the Company to comply with the asset coverage requirements of Section 18(a)(1)(A) as modified by Section 61(a)(1) and (2) of the Investment Company Act of 1940, as amended, after giving effect to any exemptive relief granted to the Company by the Securities and Exchange Commission (“SEC”) and subject to certain other exceptions. Holders will not have the option to have the Notes repaid prior to the stated maturity date. These covenants are subject to important limitations and exceptions that are described in the Indenture.

 

As previously disclosed, the Offering was made pursuant to the Company’s shelf registration statement on Form N-2, as amended (File No. 333-265864), initially filed with the SEC on June 27, 2022, and declared effective on August 2, 2022, as supplemented by a preliminary prospectus supplement, dated August 16, 2023 and a final prospectus supplement, dated August 17, 2023, each previously filed with the SEC. This Current Report on Form 8-K shall not constitute an offer to sell or a solicitation of an offer to buy any securities, nor shall there by any sale of these securities in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or other jurisdiction. The Offering closed on August 24, 2023.

 

The net proceeds to the Company were approximately $28.8 million, based on the public offering price per Note of 100.0% of the aggregate principal amount thereof, after deducting the underwriting discounts and commissions of $0.9 million payable by the Company and estimated offering expenses of approximately $0.3 million payable by the Company. The Company intends to use all or substantially all of the net proceeds from the Offering to repay amounts outstanding under its senior secured revolving credit facility, to fund new investments in accordance with the Company’s investment objective and strategies and for general corporate purposes.

 

The foregoing descriptions of the Third Supplemental Indenture and the Notes do not purport to be complete and are qualified in their entirety by reference to the full text of the Third Supplemental Indenture and the form of global note representing the Notes, filed as Exhibit 4.1 and Exhibit 4.2, respectively, to this Current Report on Form 8-K and incorporated by reference herein.

 

 

Item 2.03. Creation of a Direct Financial Obligation or an Obligation Under an Off-Balance Sheet Arrangement of a Registrant

 

The information set forth under Item 1.01 of this Current Report on Form 8-K is incorporated by reference herein.

 

Item 9.01. Financial Statements and Exhibits

 

(d) Exhibits

 

Exhibit No.		Description
4.1		Third Supplemental Indenture, dated August 24, 2023, between the Company and Equiniti Trust Company, LLC (f/k/a American Stock Transfer & Trust Company, LLC).
4.2		Form of 7.875% Notes due 2028 (included in Exhibit 4.1 hereto).
5.1		Opinion of Dechert LLP.
23.1		Consent of Dechert LLP (included in Exhibit 5.1).
104		Cover Page Interactive Data File (embedded within the Inline XBRL document).

 

 

SIGNATURE

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

Dated: August 24, 2023

 

	WHITEHORSE FINANCE, INC.
	By:	/s/ Joyson C. Thomas
		Joyson C. Thomas
		Chief Financial Officer

 

 

 

Exhibit 4.1

 

THIRD SUPPLEMENTAL INDENTURE

 

between

 

WHITEHORSE FINANCE, INC.

 

and

 

EQUINITI TRUST COMPANY, LLC,

 

Trustee

 

Dated as of August 24, 2023

 

THIS THIRD SUPPLEMENTAL INDENTURE (this “Third Supplemental Indenture”), dated as of August 24, 2023, is between WhiteHorse Finance, Inc., a Delaware corporation (the “Company”), and Equiniti Trust Company, LLC, trustee (the “Trustee”). All capitalized terms used but not otherwise defined herein shall have the meaning set forth in the Base Indenture (as defined below).

 

RECITALS OF THE COMPANY

 

WHEREAS, the Company and the Trustee executed and delivered an Indenture, dated as of November 13, 2018 (the “Base Indenture” and, as amended and supplemented by this Third Supplemental Indenture, the “Indenture”), to provide for the issuance by the Company from time to time of the Company’s debt securities (the “Securities”) evidencing its unsecured indebtedness, to be issued in one or more series as provided in the Indenture;

 

WHEREAS, the Company desires to issue and sell $30,000,000 aggregate principal amount (or up to $34,500,000 aggregate principal amount if the underwriters’ overallotment option to purchase additional Notes (as defined herein) is exercised in full) of the Company’s 7.875% Notes due 2028 (the “Notes”);

 

WHEREAS, Sections 9.01(iv) and 9.01(vi) of the Base Indenture provide that, without the consent of Holders of the Securities of any series issued under the Indenture, the Company, when authorized by or pursuant to a Board Resolution, and the Trustee, at any time and from time to time, may enter into one or more indentures supplemental to the Base Indenture to (i) change or eliminate any of the provisions of the Base Indenture when there is no Security Outstanding of any series created prior to the execution of a supplemental indenture that is entitled to the benefit of such provision and (ii) establish the form or terms of Securities of any series as permitted by Sections 2.01 and 3.01 of the Base Indenture;

 

WHEREAS, the Company desires to establish the form and terms of the Notes and to modify, alter, supplement and change certain provisions of the Base Indenture for the benefit of the Holders of the Notes (except as may be provided in a future supplemental indenture to the Indenture (each, a “Future Supplemental Indenture”)); and

 

 

WHEREAS, the Company has duly authorized the execution and delivery of this Third Supplemental Indenture to provide for the issuance of the Notes and all acts and things necessary to make this Third Supplemental Indenture a valid and legally binding obligation of the Company and to constitute a valid agreement of the Company, in accordance with its terms, have been done and performed.

 

NOW, THEREFORE, THIS INDENTURE WITNESSETH:

 

For and in consideration of the premises and the purchase of the Notes by the Holders thereof, it is mutually agreed, for the equal and proportionate benefit of all Holders of the Notes, as follows:

 

ARTICLE I

TERMS OF THE NOTES

 

Section 1.01.   Terms of the Notes. The following terms relating to the Notes are hereby established:

 

(a)               The Notes shall constitute a series of Securities having the title “7.875% Notes due 2028” and shall bear a CUSIP number of 96524V 403 and an ISIN number of US96524V4032.

 

(b)               The aggregate principal amount of the Notes that may be initially authenticated and delivered under the Indenture (except for Notes authenticated and delivered upon registration of, transfer of, or in exchange for, or in lieu of, other Notes pursuant to Sections 3.04, 3.05, 3.06, 9.06, 11.07 or 13.05 of the Base Indenture) shall $30,000,000 (or up to $34,500,000 aggregate principal amount if the underwriters’ overallotment option to purchase additional Notes is exercised in full). Under a Board Resolution, Officer’s Certificate pursuant to Board Resolutions or a Future Supplemental Indenture, the Company may from time to time, without the consent of the Holders of Notes, issue additional Notes (in any such case, “Additional Notes”) having the same ranking and the same interest rate, maturity, CUSIP number and other terms as the Notes; provided that such Additional Notes must be part of the same issue as the Notes for U.S. federal income tax purposes if represented by the same CUSIP number as the Notes. Any Additional Notes and the existing Notes shall constitute a single series under the Indenture and all references to the relevant Notes herein shall include the Additional Notes unless the context otherwise requires.

 

(c)               The entire Outstanding principal amount of the Notes shall be payable on September 15, 2028, unless earlier redeemed or repurchased in accordance with the provisions of this Third Supplemental Indenture.

 

(d)               The rate at which the Notes shall bear interest shall be 7.875% per annum of the aggregate principal amount. The date from which interest shall accrue on the Notes shall be August 24, 2023, or the most recent Interest Payment Date to which interest has been paid or provided for; the Interest Payment Dates for the Notes shall be March 15, June 15, September 15 and December 15 of each year, commencing September 15, 2023 (provided, that if an Interest Payment Date falls on a day that is not a Business Day, then the applicable interest payment shall be made on the next succeeding Business Day with the same force and effect as if made on the scheduled Interest Payment Date and no additional interest shall accrue as a result of such delayed payment); the initial interest period shall be the period from and including August 24, 2023 (or the most recent Interest Payment Date to which interest has been paid or provided for), to, but not including, the initial Interest Payment Date, and the subsequent interest periods shall be the periods from and including an Interest Payment Date to, but not including, the next Interest Payment Date or the Stated Maturity, as the case may be; the interest so payable, and punctually paid or duly provided for, on any Interest Payment Date, shall be paid to the Person in whose name the Note (or one or more Predecessor Securities) is registered at the close of business on the Regular Record Date for such interest, which shall be March 1, June 1, September 1 and December 1 (whether or not a Business Day), as the case may be, next preceding such Interest Payment Date. Payment of principal of (and premium, if any) and any such interest on the Notes shall be made at the Corporate Trust Office of the Paying Agent, which shall initially be the Trustee, in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts; provided, however, that in the case of Notes that are not in global form, at the option of the Company, payment of interest may be made by check mailed to the address of the Person entitled thereto as such address shall appear in the Security Register. Interest on the Notes shall be computed on the basis of a 360-day year of twelve 30-day months.

 

 

(e)               The Notes shall be initially issuable in global form (each such Note, a “Global Note”). The Global Notes and the Trustee’s certificate of authentication thereon shall be substantially in the form of Exhibit A to this Third Supplemental Indenture. Each Global Note shall represent the aggregate principal amount of Outstanding Notes as shall be specified therein and each shall provide that it shall represent the aggregate principal amount of Outstanding Notes from time to time endorsed thereon and that the aggregate principal amount of Outstanding Notes represented thereby may from time to time be reduced or increased, as appropriate, to reflect exchanges and redemptions. Any endorsement of a Global Note to reflect the amount of any increase or decrease in the principal amount of Outstanding Notes represented thereby shall be made by the Trustee or the Security Registrar, in accordance with Sections 2.03 and 3.05 of the Base Indenture.

 

(f)                The depositary for such Global Notes shall be The Depository Trust Company, New York, New York. The Security Registrar with respect to the Global Notes shall be the Trustee.

 

(g)               The Notes shall be defeasible pursuant to Section 14.02 or Section 14.03 of the Base Indenture. Covenant defeasance contained in Section 14.03 of the Base Indenture shall apply to the covenants contained in Sections 10.08 and 10.09 of the Indenture.

 

(h)               The Notes shall be redeemable pursuant to Section 11.01 of the Base Indenture and as follows:

 

(i)                 The Notes shall be redeemable, in whole or in part, at any time, or from time to time, at the option of the Company, on or after September 15, 2025, at a Redemption Price equal to 100% of the outstanding aggregate principal amount thereof, plus accrued and unpaid interest to, but excluding, the Redemption Date.

 

(ii)               Notice of redemption shall be given in writing and mailed, first-class postage prepaid or by overnight courier guaranteeing next-day delivery, or sent electronically in accordance with the applicable procedures of the Depositary (as defined herein) with respect to Notes in global form, to each Holder of the Notes to be redeemed, not less than 30 nor more than 60 days prior to the Redemption Date, at the Holder’s address appearing in the Security Register. All notices of redemption shall contain the information set forth in Section 11.04 of the Base Indenture and the delivery of such shall be subject to the terms of the Indenture.

 

 

(iii)               Any exercise of the Company’s option to redeem the Notes shall be done in compliance with the Indenture and the Investment Company Act, to the extent applicable.

 

(iv)               If less than all of the Notes are to be redeemed at any time, the Trustee shall select the Notes to be redeemed by lot or such similar method in accordance with the procedures of the Depositary.

 

(v)               Unless the Company defaults in payment of the Redemption Price, on and after the Redemption Date, interest shall cease to accrue on the Notes called for redemption hereunder.

 

(i)     The Notes shall not be subject to any sinking fund pursuant to Section 12.01 of the Base Indenture.

 

(j)     The Notes shall be issuable in denominations of $25 and integral multiples of $25 in excess thereof.

 

(k)    Holders of the Notes shall not have the option to have the Notes repaid prior to September 15, 2028 other than in accordance with Article Thirteen of the Base Indenture.

 

ARTICLE II

DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION

 

Section 2.01.    Except as may be provided in a Future Supplemental Indenture, for the benefit of the Holders of the Notes but no other series of Securities under the Indenture, whether now or hereafter issued and Outstanding, Article One of the Base Indenture shall be amended by adding the following defined terms to Section 1.01 thereof in appropriate alphabetical sequence, as follows:

 

“Additional Notes” shall have the meaning provided in Section 1.01(b) of this Third Supplemental Indenture.

 

“Depositary” means, with respect to each Note in global form, The Depository Trust Company, until a successor shall have been appointed and becomes such person, and thereafter, Depositary shall mean or include such successor.

 

“Exchange Act” means the United States Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated by the Commission thereunder and any statute successor thereto, in each case as amended from time to time.

 

“GAAP” means generally accepted accounting principles in the United States set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants, the opinions and pronouncements of the Public Company Accounting Oversight Board and the statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other entity as have been approved by a significant segment of the accounting profession in the United States, which are in effect from time to time.

 

 

“Significant Subsidiary” means any Subsidiary that would be a “significant subsidiary” as defined in Article 1, Rule 1-02 of Regulation S-X under the Exchange Act, as such regulation is in effect on the original date of this Indenture (but excluding any Subsidiary which is (a) a non-recourse or limited recourse Subsidiary, (b) a bankruptcy remote special purpose vehicle or (c) is not consolidated with the Company for purposes of GAAP).

 

“Surviving Person” shall have the meaning provided in Section 8.01 of this Third Supplemental Indenture.

 

Section 2.02.     Except as may be provided in a Future Supplemental Indenture, for the benefit of the Holders of the Notes but no other series of Securities under the Indenture, whether now or hereafter issued and Outstanding, Article One of the Base Indenture shall be amended by replacing the definitions of “Business Day” and “Subsidiary” in Section 1.01 thereof with the following:

 

“Business Day” means any day other than a Saturday, a Sunday or a day on which banking institutions in the City of New York or the city in which the Corporate Trust Office of the Trustee is located are authorized or obligated by law or executive order to close.

 

“Subsidiary” means, with respect to any Person, any corporation, partnership, joint venture, limited liability company or other business entity of which a majority of the outstanding shares or other interests having voting power is at the time directly or indirectly owned or controlled by such Person or one or more of the Subsidiaries of such Person. Unless the context otherwise requires, all references to Subsidiary or Subsidiaries under this Indenture shall refer to Subsidiaries of the Company. In addition, for purposes of this definition, “Subsidiary” shall exclude any investments held by the Company in the ordinary course of business which are not, under GAAP, consolidated on the financial statements of the Company and its Subsidiaries.

 

ARTICLE III

SECURITIES FORM

 

Section 3.01.    Except as may be provided in a Future Supplemental Indenture, for the benefit of the Holders of the Notes but no other series of Securities under the Indenture, whether now or hereafter issued and Outstanding, Article Two of the Base Indenture shall be amended by adding the following new Section 2.04 thereto, as set forth below:

 

“Section 2.04. Certificated Securities.

 

Notwithstanding anything to the contrary, Securities in physical, certificated form shall be issued and delivered to each person that the Depositary identifies as a beneficial owner of the related Securities only if:

 

(1)               the Depositary notifies the Company at any time that it is unwilling or unable to continue as depositary for the Securities in global form and a successor depositary is not appointed within 90 days;

 

(2)               the Depositary ceases to be registered as a clearing agency under the Exchange Act and a successor depositary is not appointed within 90 days; or

 

 

(3)               an Event of Default with respect to the Securities has occurred and is continuing and such beneficial owner requests that its Securities be issued in physical, certificated form.”

 

ARTICLE IV
REMEDIES

 

Section 4.01.    Except as may be provided in a Future Supplemental Indenture, for the benefit of the Holders of the Notes but no other series of Securities under the Indenture, whether now or hereafter issued and Outstanding, Section 5.01 of the Base Indenture shall be amended by replacing clause (i) thereof in its entirety with the following:

 

“(i) default in the payment of interest upon any Note when such interest becomes due and payable and continuance of such default for a period of 30 days; or”

 

Section 4.02.    Except as may be provided in a Future Supplemental Indenture, for the benefit of the Holders of the Notes but no other series of Securities under the Indenture, whether now or hereafter issued and Outstanding, Section 5.01 of the Base Indenture shall be amended by replacing clause (ii) thereof in its entirety with the following:

 

“(ii) default in the payment of the principal of (or premium, if any, on) any Note when it becomes due and payable at its Maturity, including upon any Redemption Date or required repurchase date; or”

 

Section 4.03.    Except as may be provided in a Future Supplemental Indenture, for the benefit of the Holders of the Notes but no other series of Securities under the Indenture, whether now or hereafter issued and Outstanding, Section 5.01 of the Base Indenture shall be amended by replacing clause (vi) thereof in its entirety with the following:

 

“(vi)    a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that:

 

(A)    is for relief against the Company in an involuntary case or proceeding, or

 

(B)    adjudges the Company bankrupt or insolvent, or approves as properly filed a petition seeking reorganization, arrangement, adjustment or composition of or in respect of the Company, or

 

(C)    appoints a Custodian of the Company or for all or substantially all of its property, or

 

(D)    orders the winding up or liquidation of the Company,

 

and the continuance of any such decree or order for relief or any such other decree or order unstayed and undischarged and in effect for a period of 90 days.”

 

Section 4.04.    Except as may be provided in a Future Supplemental Indenture, for the benefit of the Holders of the Notes but no other series of Securities under the Indenture, whether now or hereafter issued and Outstanding, Section 5.01 of the Base Indenture shall be amended by replacing clause (vii) thereof in its entirety with the following:

 

 

“(vii) if, pursuant to Section 18(a)(1)(C)(ii) and Section 61 of the Investment Company Act, or any successor provisions, on the last business day of each of 24 consecutive calendar months, any class of Securities shall have an asset coverage (as such term is used in the Investment Company Act) of less than 100%, giving effect to any amendments to such provisions of the Investment Company Act or to any exemptive relief granted to us by the Commission; or”

 

Section 4.05.    Except as may be provided in a Future Supplemental Indenture, for the benefit of the Holders of the Notes but no other series of Securities under the Indenture, whether now or hereafter issued and Outstanding, Section 5.01 of the Base Indenture shall be amended by replacing clause (viii) thereof in its entirety with the following:

 

“(viii)    default by the Company or any of its Significant Subsidiaries, with respect to any mortgage, agreement or other instrument under which there may be outstanding, or by which there may be secured or evidenced, any indebtedness for money borrowed in excess of $75 million in the aggregate of the Company and/or any such Significant Subsidiary, whether such indebtedness now exists or shall hereafter be created (i) resulting in such indebtedness becoming or being declared due and payable or (ii) constituting a failure to pay the principal or interest of any such debt when due and payable at its stated maturity, upon required repurchase, upon declaration of acceleration or otherwise, unless, in either case, such indebtedness is discharged, or such acceleration is rescinded, stayed or annulled, within a period of 30 calendar days after written notice of such failure is given to the Company by the Trustee or to the Company and the Trustee by the Holders of at least 25% in aggregate principal amount of the Notes then Outstanding.

 

Section 4.06.    Except as may be provided in a Future Supplemental Indenture, for the benefit of the Holders of the Notes but no other series of Securities under the Indenture, whether now or hereafter issued and Outstanding, Section 5.02 of the Base Indenture shall be amended by replacing the first paragraph thereof in its entirety with the following:

 

“If an Event of Default with respect to the Notes occurs and is continuing, then and in every such case (other than an Event of Default specified in Section 5.01(v) or 5.01(vi)), the Trustee or the holders of not less than 25% in principal amount of the Outstanding Notes may declare the principal of all the Outstanding Notes to be due and payable immediately, by a notice in writing to the Company (and to the Trustee if given by the holders of the Outstanding Notes), and upon any such declaration such principal or specified portion thereof shall become immediately due and payable; provided that 100% of the principal of, and accrued and unpaid interest on, the Outstanding Notes shall automatically become due and payable in the case of an Event of Default specified in 5.01(v) or 5.01(vi) hereof.”

 

Section 4.07.    Except as may be provided in a Future Supplemental Indenture, for the benefit of the Holders of the Notes but no other series of Securities under the Indenture, whether now or hereafter issued and Outstanding, Section 5.07 of the Base Indenture shall be amended by replacing clause (iii) thereof in its entirety with the following:

 

 

“(iii) such Holder or Holders have offered to the Trustee security or indemnity satisfactory to the Trustee against the costs, expenses and liabilities to be incurred in compliance with such request;”

 

Section 4.08.    Except as may be provided in a Future Supplemental Indenture, for the benefit of the Holders of the Notes but no other series of Securities under the Indenture, whether now or hereafter issued and Outstanding, Section 5.12 of the Base Indenture shall be amended by replacing clause (iii) thereof in its entirety with the following:

 

“(iii) the Trustee need not take any action that it determines in good faith might involve it in personal liability or be unjustly prejudicial to the Holders of Securities of such series not consenting (it being understood that the Trustee does not have an affirmative duty to ascertain whether or not any such directions are unduly prejudicial to such Holders).”

 

ARTICLE V
COVENANTS

 

Section 5.01.    Except as may be provided in a Future Supplemental Indenture, for the benefit of the Holders of the Notes but no other series of Securities under the Indenture, whether now or hereafter issued and Outstanding, Article Ten of the Base Indenture shall be amended by replacing Section 10.06 thereof in its entirety with the following:

 

“Section 10.06. [RESERVED]”

 

Section 5.02.    Except as may be provided in a Future Supplemental Indenture, for the benefit of the Holders of the Notes but no other series of Securities under the Indenture, whether now or hereafter issued and Outstanding, Article Ten of the Base Indenture shall be amended by replacing Section 10.07 thereof in its entirety with the following:

 

“Section 10.07. Waiver of Certain Covenants.

 

The Company may omit in any particular instance to comply with any covenant or condition, as specified pursuant to Section 3.01(xv), for Securities of any series, in any covenants of the Company added to Article Ten pursuant to Section 3.01(xiv) or Section 3.01(xv) in connection with the Securities of a series, if before or after the time for such compliance the Holders of at least a majority in aggregate principal amount of all Outstanding Securities of such series, by Act of such Holders, either waive such compliance in such instance or generally waive compliance with such covenant or condition, but no such waiver shall extend to or affect such covenant or condition except to the extent so expressly waived, and, until such waiver shall become effective, the obligations of the Company and the duties of the Trustee in respect of any such covenant or condition shall remain in full force and effect.”

 

 

ARTICLE VI
REDEMPTION

 

Section 6.01.    Except as may be provided in a Future Supplemental Indenture, for the benefit of the Holders of the Notes but no other series of Securities under the Indenture, whether now or hereafter issued and Outstanding, Article Eleven of the Base Indenture shall be amended by replacing Section 11.03 thereof in its entirety with the following:

 

“Section 11.03. Selection by Trustee of Securities to Be Redeemed.

 

If less than all the Securities of any series issued on the same day with the same terms are to be redeemed, the particular Securities to be redeemed shall be selected not more than 60 days prior to the Redemption Date by the Trustee, from the Outstanding Securities of such series issued on such date with the same terms not previously called for redemption, by lot or such similar method in accordance with the procedures of The Depository Trust Company; provided that such method complies with the rules of any national securities exchange or quotation system on which the Securities are listed (which rules shall be certificated to the Trustee by the Company or such national securities exchange at the Trustee’s request), and may provide for the selection for redemption of portions (equal to the minimum authorized denomination for Securities of that series or any integral multiple thereof) of the principal amount of Securities of such series of a denomination larger than the minimum authorized denomination for Securities of that series; provided, however, that no such partial redemption shall reduce the portion of the principal amount of a Security not redeemed to less than the minimum authorized denomination for Securities of such series.

 

The Trustee shall promptly notify the Company and the Security Registrar (if other than itself) in writing of the Securities selected for redemption and, in the case of any Securities selected for partial redemption, the principal amount thereof to be redeemed.

 

For all purposes of this Indenture, unless the context otherwise requires, all provisions relating to the redemption of Securities shall relate, in the case of any Security redeemed or to be redeemed only in part, to the portion of the principal amount of such Security which has been or is to be redeemed.”

 

ARTICLE VII
DEFEASANCE AND COVENANT DEFEASANCE

Section 7.01.     Except as may be provided in a Future Supplemental Indenture, for the benefit of the Holders of the Notes but no other series of Securities under the Indenture, whether now or hereafter issued and Outstanding, Article Fourteen of the Base Indenture shall be amended by replacing Section 14.03 thereof in its entirety with the following:

 

 

“Section 14.03. Covenant Defeasance.

 

Upon the Company’s exercise of the above option applicable to this Section with respect to any Securities of or within a series, the Company shall be released, if specified pursuant to Section 3.01, from its obligations under any covenant, with respect to such Outstanding Securities on and after the date the conditions set forth in Section 14.04 are satisfied (hereinafter, “covenant defeasance”), and such Securities shall thereafter be deemed to be not “Outstanding” for the purposes of any direction, waiver, consent or declaration or Act of Holders (and the consequences of any thereof) in connection with such covenant, but shall continue to be deemed “Outstanding” for all other purposes hereunder. For this purpose, such covenant defeasance means that, with respect to such Outstanding Securities, the Company may omit to comply with, and shall have no liability in respect of, any term, condition or limitation set forth in any such Section or such other covenant, whether directly or indirectly, by reason of any reference elsewhere herein to any such Section or such other covenant or by reason of reference in any such Section or such other covenant to any other provision herein or in any other document and such omission to comply shall not constitute a Default or an Event of Default under Section 5.01(iv) or 5.01(viii) or otherwise, as the case may be, but, except as specified above, the remainder of this Indenture and such Securities shall be unaffected thereby. Following a covenant defeasance, payment of such Securities may not be accelerated because of an Event of Default solely by reference to such Sections specified above in this Section 14.03.”

 

Section 7.02.    Except as may be provided in a Future Supplemental Indenture, for the benefit of the Holders of the Notes but no other series of Securities under the Indenture, whether now or hereafter issued and Outstanding, Article Fourteen of the Base Indenture shall be amended by replacing Sections 14.04(i) thereof in their entirety with the following:

 

“(i) The Company shall have irrevocably deposited or caused to be irrevocably deposited with the Trustee (or another trustee satisfying the requirements of Section 6.07 who shall agree to comply with the provisions of this Article Fourteen applicable to it) as trust funds in trust for the purpose of making the following payments, specifically pledged as security for the benefit of, and dedicated solely to, the Holders of such Securities, (A) an amount (in such Currency in which such Securities are then specified as payable at Stated Maturity) or (B) Government Obligations applicable to such Securities (determined on the basis of the Currency in which such Securities are then specified as payable at Stated Maturity) which through the scheduled payment of principal and interest in respect thereof in accordance with their terms will provide, not later than one day before the due date of any payment of principal of (and premium, if any) and interest, if any, on such Securities, money in an amount, or (C) a combination thereof in an amount, sufficient, in the opinion of a nationally recognized investment bank, appraisal firm or firm of independent public accountants expressed in a written certification thereof delivered to the Trustee, to pay and discharge, and which shall be applied by the Trustee (or other qualifying trustee) to pay and discharge, (1) the principal of (and premium, if any) and interest, if any, on such Outstanding Securities on the Stated Maturity of such principal or installment of principal or interest and (2) any mandatory sinking fund payments or analogous payments applicable to such Outstanding Securities on the day on which such payments are due and payable in accordance with the terms of this Indenture and of such Securities.”

 

Section 7.03.    Except as may be provided in a Future Supplemental Indenture, for the benefit of the Holders of the Notes but no other series of Securities under the Indenture, whether now or hereafter issued and Outstanding, Article Fourteen of the Base Indenture shall be amended by replacing Sections 14.04(vi) and (vii) thereof in their entirety with the following:

 

 

“(vi) The Company shall have delivered to the Trustee an Officer’s Certificate and an Opinion of Counsel, each stating that all conditions precedent to either the defeasance under Section 14.02 or the covenant defeasance under Section 14.03 (as the case may be) have been complied with and an Opinion of Counsel to the effect that either (i) as a result of a deposit pursuant to subsection (a) above and the related exercise of the Company’s option under Section 14.02 or Section 14.03 (as the case may be), registration is not required under the Investment Company Act by the Company, with respect to the trust funds representing such deposit or by the trustee for such trust funds or (ii) all necessary registrations under said Act have been effected.

 

(vii) [RESERVED]”

 

Section 7.04.    Except as may be provided in a Future Supplemental Indenture, for the benefit of the Holders of the Notes but no other series of Securities under the Indenture, whether now or hereafter issued and Outstanding, Section 14.05 of the Base Indenture shall be amended by replacing the fourth paragraph thereof in its entirety with the following:

 

“Anything in this Article to the contrary notwithstanding, the Trustee shall deliver or pay to the Company from time to time upon Company Request any money or Government Obligations (or other property and any proceeds therefrom) held by it as provided in Section 14.04 which, in the opinion of a nationally recognized investment bank, appraisal firm or firm of independent public accountants expressed in a written certification thereof delivered to the Trustee, are in excess of the amount thereof which would then be required to be deposited to effect a defeasance or covenant defeasance, as applicable, in accordance with this Article.”

 

Section 7.05.    Except as may be provided in a Future Supplemental Indenture, for the benefit of the Holders of the Notes but no other series of Securities under the Indenture, whether now or hereafter issued and Outstanding, Section 14.05 of the Base Indenture shall be amended by deleting the final paragraph thereof in its entirety.

 

ARTICLE VIII
MEETINGS OF HOLDERS OF SECURITIES

 

Section 8.01.     Except as may be provided in a Future Supplemental Indenture, for the benefit of the Holders of the Notes but no other series of Securities under the Indenture, whether now or hereafter issued and Outstanding, Section 15.05 of the Base Indenture shall be amended by replacing clause (c) thereof in its entirety with the following:

 

“(c) At any meeting of Holders, each Holder of a Security of such series or proxy shall be entitled to one vote for each $25.00 principal amount of the Outstanding Securities of such series held or represented by such Holder; provided, however, that no vote shall be cast or counted at any meeting in respect of any Security challenged as not Outstanding and ruled by the chairman of the meeting to be not Outstanding. The chairman of the meeting shall have no right to vote, except as a Holder of a Security of such series or proxy.”

 

 

ARTICLE IX

CONSOLIDATION, MERGER, CONVEYANCE OR TRANSFER

 

Section 9.01.     Except as may be provided in a Future Supplemental Indenture, for the benefit of the Holders of the Notes but no other series of Securities under the Indenture, whether now or hereafter issued and Outstanding, Section 8.01 of the Base Indenture shall be amended by replacing Section 8.01 in its entirety with the following:

 

“Section 8.01. Company May Consolidate, Etc., Only on Certain Terms.

 

The Company shall not merge or consolidate with or into any other Person (other than a merger of a wholly owned Subsidiary of the Company into the Company) or sell, transfer, lease, convey or otherwise dispose of all or substantially all of its property (provided that, for the avoidance of doubt, a pledge of assets pursuant to any secured debt instrument of the Company or its Subsidiaries shall not be deemed to be any such sale, transfer, lease, conveyance or disposition; and provided further that this Section 8.01 shall not apply to any sale, transfer, lease, conveyance, or other disposition of all or substantially all of the Company’s property to a wholly owned Subsidiary) in one transaction or series of related transactions unless:

 

(1)      the Company shall be the surviving Person (the “Surviving Person”) or the Surviving Person (if other than the Company) formed by such merger or consolidation or to which such sale, transfer, lease, conveyance or disposition is made shall be a corporation or limited liability company or trust organized and existing under the laws of the United States of America or any state or territory thereof or the District of Columbia;

 

(2)     the Surviving Person (if other than the Company) expressly assumes, by supplemental indenture in form reasonably satisfactory to the Trustee, executed and delivered to the Trustee by such Surviving Person, the due and punctual payment of the principal of, and premium, if any, and interest on, all the Outstanding Securities, and the due and punctual performance and observance of all the covenants and conditions of this Indenture to be performed by the Company;

 

(3)     immediately before and immediately after giving effect to such transaction or series of related transactions, no Default or Event of Default shall have occurred and be continuing; and

 

(4)     the Company shall deliver, or cause to be delivered, to the Trustee, an Officer’s Certificate and an Opinion of Counsel, each stating that such transaction and the supplemental indenture, if any, in respect thereto comply with this Section 8.01, that all conditions precedent in this Indenture relating to such transaction have been complied with.

 

For the purposes of this Section 8.01, the sale, transfer, lease, conveyance or other disposition of all the property of one or more Subsidiaries of the Company, which property, if held by the Company instead of such Subsidiaries, would constitute all or substantially all the property of the Company on a consolidated basis, shall be deemed to be the transfer of all or substantially all the property of the Company.”

 

 

Section 9.02.     Except as may be provided in a Future Supplemental Indenture, for the benefit of the Holders of the Notes but no other series of Securities under the Indenture, whether now or hereafter issued and Outstanding, Section 8.02 of the Base Indenture shall be amended by replacing Section 8.02 in its entirety with the following:

 

“Section 8.02. Successor Person Substituted.

 

Upon any consolidation or merger, or any conveyance or transfer of the properties and assets of the Company substantially as an entirety in accordance with Section 8.01, the successor Person formed by such consolidation or into which the Company is merged or the successor Person to which such conveyance or transfer is made shall succeed to, and be substituted for, and may exercise every right and power of, the Company under this Indenture with the same effect as if such successor had been named as the Company herein; and in the event of any such conveyance or transfer, the Company shall be discharged from all obligations and covenants under this Indenture and the Securities and may be dissolved and liquidated.”

 

ARTICLE X

MISCELLANEOUS

 

Section 10.01.    This Third Supplemental Indenture and the Notes shall be governed by and construed in accordance with the laws of the State of New York. This Third Supplemental Indenture is subject to the provisions of the Trust Indenture Act that are required to be part of the Indenture and shall, to the extent applicable, be governed by such provisions. If any provision of the Indenture limits, qualifies or conflicts with the duties imposed by Section 318(c) of the Trust Indenture Act, the imposed duties will control.

 

Section 10.02.    In case any provision in this Third Supplemental Indenture or in the Notes shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

 

Section 10.03.    This Third Supplemental Indenture may be executed in any number of counterparts, each of which so executed shall be deemed to be an original, but all such counterparts shall together constitute but one and the same Third Supplemental Indenture. The exchange of copies of this Third Supplemental Indenture and of signature pages by facsimile, .pdf transmission, email or other electronic means shall constitute effective execution and delivery of this Third Supplemental Indenture for all purposes. Signatures of the parties hereto transmitted by facsimile, .pdf transmission, email or other electronic means shall be deemed to be their original signatures for all purposes.

 

Section 10.04.    The Base Indenture, as supplemented and amended by this Third Supplemental Indenture, is in all respects ratified and confirmed, and the Base Indenture and this Third Supplemental Indenture shall be read, taken and construed as one and the same instrument with respect to the Notes. All provisions included in this Third Supplemental Indenture supersede any conflicting provisions included in the Base Indenture with respect to the Notes, unless not permitted by law. The Trustee accepts the trusts created by the Indenture, as supplemented by this Third Supplemental Indenture, and agrees to perform the same upon the terms and conditions of the Base Indenture, as supplemented by this Third Supplemental Indenture. All of the provisions contained in the Base Indenture in respect of the rights, privileges, immunities, powers, and duties of the Trustee shall be applicable in respect of this Third Supplemental Indenture as fully and with like force and effect as though fully set forth in full herein.

 

 

Section 10.05.    The provisions of this Third Supplemental Indenture shall become effective as of the date hereof.

 

Section 10.06.    No past, present or future director, officer, employee, incorporator, or stockholder of the Company shall have any liability for any obligations of the Company under the Indenture or the Notes or for any claim based on, in respect of, or by reason of, such obligations or their creation. By accepting any Note, each Holder shall have been deemed to waive and release all such liability, and such waiver and release are part of the consideration for issuance of the Notes.

 

Section 10.07.    Notwithstanding anything else to the contrary herein, the terms and provisions of this Third Supplemental Indenture shall apply only to the Notes and shall not apply to any other series of Securities under the Base Indenture and this Third Supplemental Indenture shall not and does not otherwise affect, modify, alter, supplement or change the terms and provisions of any other series of Securities under the Indenture, whether now or hereafter issued and Outstanding.

 

Section 10.08.    The recitals contained herein and in the Notes, except the Trustee’s certificate of authentication shall be taken as the statements of the Company, and the Trustee assumes no responsibility for their correctness. The Trustee makes no representations as to the validity or sufficiency of this Third Supplemental Indenture, the Notes or any Additional Notes, except that the Trustee represents that it is duly authorized to execute and deliver this Third Supplemental Indenture, authenticate the Notes and any Additional Notes and perform its obligations hereunder. The Trustee shall not be accountable for the use or application by the Company of the Notes or any Additional Notes or the proceeds thereof.

 

 

IN WITNESS WHEREOF, the parties hereto have caused this Third Supplemental Indenture to be duly executed as of the date first above written.

 

WHITEHORSE FINANCE, INC.

 

	By:	/s/ Joyson C. Thomas
	Name:	Joyson C. Thomas
	Title:	Chief Financial Officer

 

[Signature Page to Third Supplemental Indenture]

 

 

IN WITNESS WHEREOF, the parties hereto have caused this Third Supplemental Indenture to be duly executed as of the date first above written.

 

	EQUINITI TRUST COMPANY, LLC, Trustee
	By:	/s/ Paul H. Kim
	Name:	Paul H. Kim
	Title:	Assistant General Counsel

 

[Signature Page to Third Supplemental Indenture]

 

 

Exhibit A – Form of Global Note

 

THIS SECURITY IS A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE DEPOSITORY TRUST COMPANY OR A NOMINEE THEREOF. THIS SECURITY MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A SECURITY REGISTERED, AND NO TRANSFER OF THIS SECURITY IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN THE DEPOSITORY TRUST COMPANY OR A NOMINEE THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.

 

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT AND SUCH CERTIFICATE ISSUED IN EXCHANGE FOR THIS CERTIFICATE IS REGISTERED IN THE NAME OF CEDE & CO., OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL, AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

 

WhiteHorse Finance, Inc.

 

No.	$
	CUSIP No. 96524V 403 ISIN No. US96524V4032

 

7.875% Notes due 2028

 

WhiteHorse Finance, Inc., a corporation duly organized and existing under the laws of the State of Delaware (herein called the “Company”, which term includes any successor Person under the Indenture hereinafter referred to), for value received, hereby promises to pay to Cede & Co., or registered assigns, the principal sum of                 dollars (U.S. $            ) on September 15, 2028, and to pay interest thereon from August 24, 2023 or from the most recent Interest Payment Date to which interest has been paid or duly provided for, quarterly on March 15, June 15, September 15 and December 15 of each year, commencing September 15, 2023 (provided, that if an Interest Payment Date falls on a day that is not a Business Day in The City of New York, then the applicable interest payment shall be made on the next succeeding Business Day and no additional interest shall accrue as a result of such delayed payment), at the rate of 7.875% per annum, until the principal hereof is paid or made available for payment. The interest so payable, and punctually paid or duly provided for, on any Interest Payment Date shall, as provided in such Indenture, be paid to the Person in whose name this Security is registered at the close of business on the Regular Record Date for such interest, which shall be March 1, June 1, September 1 and December 1 (whether or not a Business Day), as the case may be, next preceding such Interest Payment Date. Any such interest not so punctually paid or duly provided for shall forthwith cease to be payable to the Holder on such Regular Record Date and may either be paid to the Person in whose name this Security is registered at the close of business on a Special Record Date for the payment of such Defaulted Interest to be fixed by the Company, notice whereof shall be given to Holders of Securities of this series not less than 10 days prior to such Special Record Date, or be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange on which the Securities of this series may be listed, and upon such notice as may be required by such exchange, all as more fully provided in said Indenture. This Security may be issued as part of a series.

 

 

Payment of the principal of (and premium, if any) and any such interest on this Security shall be made at the Corporate Trust Office of the Paying Agent, which shall initially be the Trustee, in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts; provided, however, that at the option of the Company payment of interest may be made by check mailed to the address of the Person entitled thereto as such address shall appear in the Security Register; provided, further, however, that so long as this Security is registered to Cede & Co., such payment shall be made by wire transfer in accordance with the procedures established by the Depository Trust Company and the Trustee.

 

Reference is hereby made to the further provisions of this Security set forth on the reverse hereof, which further provisions shall for all purposes have the same effect as if set forth at this place.

 

Unless the certificate of authentication hereon has been executed by the Trustee referred to on the reverse hereof by manual signature, this Security shall not be entitled to any benefit under the Indenture or be valid or obligatory for any purpose.

 

 

IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed.

 

Dated:
	WHITEHORSE FINANCE, INC.
	By:
	Name:	Joyson C. Thomas
	Title:	Chief Financial Officer

 

Attested by:
WHITEHORSE FINANCE, INC.
By:
Name:	Richard Siegel
Title:	Secretary

 

 

This is one of the Securities of the series designated therein referred to in the within-mentioned Indenture.

 

Dated:
	EQUINITI TRUST COMPANY, LLC, as Trustee
	By:
		Authorized Officer

 

 

[BACK OF NOTE]

WhiteHorse Finance, Inc.
7.875% Notes due 2028

 

This Security is one of a duly authorized issue of securities of the Company (herein called the “Securities”), issued and to be issued in one or more series under an Indenture, dated as of November 13, 2018 (herein called the “Base Indenture”), between the Company and American Stock Transfer & Trust Company, LLC, Trustee (herein called the “Trustee”, which term includes any successor trustee under the Base Indenture), and reference is hereby made to the Base Indenture for a statement of the respective rights, limitations of rights, duties and immunities thereunder of the Company, the Trustee and the Holders of the Securities and of the terms upon which the Securities are, and are to be, authenticated and delivered, as supplemented by the Third Supplemental Indenture, relating to the Securities, dated as of August 24, 2023, by and between the Company and the Trustee (herein called the “Third Supplemental Indenture”; and together with the Base Indenture, the “Indenture”). In the event of any conflict between the Base Indenture and the Third Supplemental Indenture, the Third Supplemental Indenture shall govern and control.

 

This Security is one of the series designated on the face hereof, initially limited in aggregate principal amount to $30,000,000 (or $34,500,000 aggregate principal amount if the underwriters’ overallotment option to purchase additional Securities is exercised in full). Under a Board Resolution, an Officer’s Certificate pursuant to a Board Resolution or a supplemental indenture, the Company may from time to time, without the consent of the Holders of Securities, issue additional Securities of this series (in any such case, “Additional Securities”) having the same ranking and the same interest rate, maturity, CUSIP number and other terms as the Securities, provided that such Additional Securities must be part of the same issue as the Securities for U.S. federal income tax purposes if represented by the same CUSIP number as the Securities. Any Additional Securities and the existing Securities shall constitute a single series under the Indenture and all references to the relevant Securities herein shall include the Additional Securities unless the context otherwise requires. The aggregate amount of Outstanding Securities represented hereby may from time to time be reduced or increased, as appropriate, to reflect exchanges and redemptions.

 

The Securities are subject to redemption in whole or in part at any time or from time to time, at the option of the Company, on or after September 25, 2025, at a redemption price equal to 100% of the outstanding aggregate principal amount thereof, plus accrued and unpaid interest to, but excluding, the date fixed for redemption (the “Redemption Date”).

 

Notice of redemption shall be given in writing and mailed, first-class postage prepaid or by overnight courier guaranteeing next-day delivery, or sent electronically in accordance with the applicable procedures of the Depository with respect to Securities in global form, to each Holder of the Securities to be redeemed, not less than thirty (30) nor more than sixty (60) days prior to the Redemption Date, at the Holder’s address appearing in the Security Register. All notices of redemption shall contain the information set forth in Section 11.04 of the Base Indenture.

 

Any exercise of the Company’s option to redeem the Securities shall be done in compliance with the Investment Company Act of 1940, as amended, and the rules, regulations and interpretations promulgated thereunder, to the extent applicable, and any statute successor thereto (the “Investment Company Act”).

 

 

If the Company elects to redeem only a portion of the Securities, the particular Securities to be redeemed shall be selected by the Trustee on a pro rata basis to the extent practicable, or, if a pro rata basis is not practicable for any reason, by lot or in such other manner as the Trustee shall deem fair and appropriate, and in any case in accordance with the applicable procedures of the Depositary, and in accordance with the Investment Company Act as directed by the Company. In the event of redemption of this Security in part only, a new Security or Securities of this series and of like tenor for the unredeemed portion hereof shall be issued in the name of the Holder hereof upon the cancellation hereof.

 

Unless the Company defaults in payment of the Redemption Price, on and after the Redemption Date, interest shall cease to accrue on the Securities called for redemption.

 

The Indenture contains provisions for defeasance at any time of the entire indebtedness of this Security or certain restrictive covenants and Events of Default with respect to this Security, in each case upon compliance with certain conditions set forth in the Indenture.

 

Holders of Securities do not have the option to have the Securities repaid prior to September 15, 2028 other than in accordance with Article Thirteen of the Base Indenture.

 

If an Event of Default with respect to Securities of this series shall occur and be continuing (other than Events of Default related to certain events of bankruptcy, insolvency or reorganization as set forth in the Indenture), the principal of the Securities of this series may be declared due and payable in the manner and with the effect provided in the Indenture. In the case of certain events of bankruptcy, insolvency or reorganization described in the Indenture, 100% of the principal of and accrued and unpaid interest on the Securities shall automatically become due and payable.

 

The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Company and the rights of the Holders of the Securities of each series to be affected under the Indenture at any time by the Company and the Trustee with the consent of the Holders of not less than a majority in principal amount of the Securities at the time Outstanding of each series to be affected. The Indenture also contains provisions permitting the Holders of specified percentages in principal amount of the Securities of each series at the time Outstanding, on behalf of the Holders of all Securities of such series, to waive compliance by the Company with certain provisions of the Indenture and certain past defaults under the Indenture and their consequences. Any such consent or waiver by the Holder of this Security shall be conclusive and binding upon such Holder and upon all future Holders of this Security and of any Security issued upon the registration of transfer hereof or in exchange herefor or in lieu hereof, whether or not notation of such consent or waiver is made upon this Security.

 

As provided in and subject to the provisions of the Indenture, the Holder of this Security shall not have the right to institute any proceeding with respect to the Indenture or for the appointment of a receiver or trustee or for any other remedy thereunder, unless such Holder shall have previously given the Trustee written notice of a continuing Event of Default with respect to the Securities of this series, the Holders of not less than 25% in principal amount of the Securities of this series at the time Outstanding shall have made written request to the Trustee to institute proceedings in respect of such Event of Default as Trustee and offered the Trustee security or indemnity satisfactory to the Trustee against the costs, expenses and liabilities to be incurred in compliance with such request, and the Trustee shall not have received from the Holders of a majority in principal amount of Securities of this series at the time Outstanding a direction inconsistent with such request, and shall have failed to institute any such proceeding, for 60 days after receipt of such notice, request and offer of security or indemnity. The foregoing shall not apply to any suit instituted by the Holder of this Security for the enforcement of any payment of principal hereof or any premium or interest hereon on or after the respective due dates expressed herein.

 

 

No reference herein to the Indenture and no provision of this Security or of the Indenture shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay the principal of and any premium and interest on this Security at the times, place and rate, and in the coin or currency, herein prescribed.

 

As provided in the Indenture and subject to certain limitations therein set forth, the transfer of this Security is registrable in the Security Register, upon surrender of this Security for registration of transfer at the office or agency of the Company in any place where the principal of and any premium and interest on this Security are payable, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Company and the Security Registrar duly executed by, the Holder hereof or his attorney duly authorized in writing, and thereupon one or more new Securities of this series and of like tenor, of authorized denominations and for the same aggregate principal amount, shall be issued to the designated transferee or transferees.

 

The Securities of this series are issuable only in registered form without coupons in denominations of $25 and any integral multiples of $25 in excess thereof. As provided in the Indenture and subject to certain limitations therein set forth, Securities of this series are exchangeable for a like aggregate principal amount of Securities of this series and of like tenor of a different authorized denomination, as requested by the Holder surrendering the same.

 

No service charge shall be made for any such registration of transfer or exchange, but the Company or Trustee may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection therewith.

 

Prior to due presentment of this Security for registration of transfer, the Company, the Trustee and any agent of the Company or the Trustee may treat the Person in whose name this Security is registered as the owner hereof for all purposes, whether or not this Security be overdue, and neither the Company, the Trustee nor any such agent shall be affected by notice to the contrary.

 

All terms used in this Security which are defined in the Indenture shall have the meanings assigned to them in the Indenture.

 

To the extent any provision of this Security conflicts with the express provisions of the Indenture, the provisions of the Indenture shall govern and be controlling.

 

The Indenture and this Security shall be governed by and construed in accordance with the laws of the State of New York.

 

 

ASSIGNMENT FORM

 

To assign this Note, fill in the form below:

 

(I) or (we) assign and transfer this Note to:
	(INSERT ASSIGNEE’S LEGAL NAME)
	(Insert assignee’s soc. sec. or tax I.D. no.)
	(Print or type assignee’s name, address and zip code)

 

and irrevocably appoint _________________________ to transfer this Note on the books of the Company. The agent may substitute another to act for him.

 

Date:

 

	Your
	Signature:
		(Sign exactly as your name appears on the face of this Note)

 

Signature Guarantee*:

*

Participant in a recognized Signature Guarantee Medallion Program (or other signature guarantor acceptable to the Trustee).

 

 

 

 

Exhibit 5.1

 

One International Place, 40th Floor 100 Oliver Street Boston, MA  02110-2605 +1  617  728  7100  Main +1  617  426  6567  Fax www.dechert.com

 

August 24, 2023

 

WhiteHorse Finance, Inc.

1450 Brickell Avenue, 31^st Floor

Miami, FL 33131

 

Re:       Registration Statement on Form N-2

 

Ladies and Gentlemen:

 

We have acted as counsel to WhiteHorse Finance, Inc., a Delaware corporation (the “Company”), in connection with the preparation and filing of a registration statement on Form N-2 (Registration No. 333-265864) as originally filed on June 27, 2022 by the Company under the Securities Act of 1933, as amended (the “Securities Act”), and under the Investment Company Act of 1940, as amended (the “Investment Company Act”), with the Securities and Exchange Commission (the “Commission”) (the registration statement as of its most recent effective date, including the prospectus and the information deemed to be part thereof at the time of effectiveness, the exhibits thereto and the documents incorporated by reference therein, being hereinafter referred to collectively as the “Registration Statement”) and the final prospectus supplement, dated August 17, 2023 (including the base prospectus filed therewith, the “Prospectus Supplement”), relating to the proposed issuance by the Company of $30,000,000 aggregate principal amount of its 7.875% notes due 2028 (the “Notes”), to be sold to underwriters pursuant to an underwriting agreement, dated August 17, 2023 (the “Underwriting Agreement”), by and among the Company, H.I.G. WhiteHorse Advisers, LLC, a Delaware limited liability company, H.I.G. WhiteHorse Administration, LLC, a Delaware limited liability company, and Oppenheimer & Co. Inc., as representative of the several underwriters set forth on Schedule I thereto. This opinion letter is being furnished to the Company in accordance with the requirements of Item 25 of Form N-2 under the Investment Company Act, and we express no opinion herein as to any matter other than as to the legality of the Indenture (as defined below) and the Notes.

 

The Notes are to be issued pursuant to the indenture, dated as of November 13, 2018 (the “Base Indenture”), between the Company and Equiniti Trust Company, LLC (f/k/a American Stock Transfer & Trust Company, LLC), trustee (the “Trustee”), as supplemented by the third supplemental indenture, dated as of August 24, 2023 (the “Supplemental Indenture,” and, together with the Base Indenture, the “Indenture”), between the Company and the Trustee.

 

In rendering the opinions expressed below, we have examined and relied on originals or copies, certified or otherwise identified to our satisfaction, of such documents, corporate records and other instruments and such agreements, certificates and receipts of public officials, certificates of officers or other representatives of the Company and others, and such other documents as we have deemed necessary or appropriate as a basis for rendering the opinions set forth below, including the following documents:

 

 

WhiteHorse Finance, Inc. August 24, 2023 Page 2

 

	(i)	the Registration Statement;
	(ii)	the Prospectus Supplement;
	(iii)	the Underwriting Agreement;
	(iv)	the Base Indenture;

 

(v)

the Supplemental Indenture;

 

(vi)

a specimen copy of the form of the Notes to be issued pursuant to the Indenture;

 

(vii)

the Certificate of Incorporation of the Company, as amended to date;

 

(viii)

the Second Amended and Restated Bylaws of the Company;

 

(ix)

a certificate of good standing with respect to the Company issued by the Secretary of State of the State of Delaware as of a recent date; and

 

(x)

resolutions of the board of directors of the Company (the “Board”) and resolutions approved by the pricing committee of the Board relating to, among other things, the authorization and issuance of the Notes.

 

As to the facts upon which this opinion is based, we have relied, to the extent we deem proper, upon certificates of public officials and certificates and written statements of agents, officers, directors, employees and representatives of the Company without having independently verified such factual matters.

 

In our examination, we have assumed the genuineness of all signatures, the authenticity of all documents submitted to us as original documents and the conformity to original documents of all documents submitted to us as copies. In addition, we have assumed (i) the legal capacity of natural persons who are signatories to the documents examined by us and (ii) the legal power and authority of all persons signing on behalf of the parties to such documents (other than the Company).

 

On the basis of the foregoing and subject to the assumptions and qualifications set forth in this letter, we are of the opinion that:

 

1.

The Base Indenture constitutes the valid and legally binding obligation of the Company, enforceable against the Company in accordance with its terms.

 

 

WhiteHorse Finance, Inc. August 24, 2023 Page 3

 

2.

When the Supplemental Indenture is duly authorized, executed and delivered by the Company, the Supplemental Indenture will constitute the valid and legally binding obligation of the Company, enforceable against the Company in accordance with its terms.

 

3.

When duly executed by the Company and authenticated by the Trustee in accordance with the terms of the Indenture and delivered to the underwriters against payment therefor in accordance with the terms of the Underwriting Agreement, the Notes will constitute the valid and legally binding obligations of the Company, enforceable against the Company in accordance with their terms.

 

The opinions set forth herein are subject to the following assumptions, qualifications, limitations and exceptions being true and correct at or before the issuance of the Notes:

 

(i)

the Base Indenture, the Supplemental Indenture and the Notes have been duly authorized, executed and delivered by each party thereto (other than the Company);

 

(ii)

the terms of the Notes as established comply with the requirements of the Investment Company Act; and

 

(iii)

the Notes have been duly executed by the Company and authenticated by the Trustee in accordance with the Indenture and delivered to and paid for by the purchasers thereof.

 

The opinions set forth herein as to enforceability of obligations of the Company are subject to: (i) bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium or similar laws now or hereinafter in effect affecting the enforcement of creditors’ rights generally, and by general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law) and the discretion of the court or other body before which any proceeding may be brought; (ii) the unenforceability under certain circumstances under law or court decisions of provisions providing for the indemnification of, or contribution to, a party with respect to a liability where such indemnification or contribution is contrary to public policy; (iii) provisions of law which may require that a judgment for money damages rendered by a court in the United States be expressed only in U.S. dollars; (iv) requirements that a claim with respect to any debt securities denominated other than in U.S. dollars (or a judgment denominated other than in U.S. dollars in respect of such claim) be converted into U.S. dollars at a rate of exchange prevailing on a date determined pursuant to applicable law; and (v) governmental authority to limit, delay or prohibit the making of payments outside the United States or in foreign currency or composite currency.

 

We express no opinion as to the validity, legally binding effect or enforceability of any provision in any agreement or instrument that (i) requires or relates to payment of any interest at a rate or in an amount which a court may determine in the circumstances under applicable law to be commercially unreasonable or a penalty or forfeiture or (ii) relates to governing law and submission by the parties to the jurisdiction of one or more particular courts.

 

 

WhiteHorse Finance, Inc. August 24, 2023 Page 4

 

The opinions expressed herein are limited to the federal laws of the United States of America, the laws of the State of New York and the General Corporation Law of the State of Delaware. We are members of the bar of the State of New York.

 

This opinion letter has been prepared for the Company’s use solely in connection with the Registration Statement. We assume no obligation to advise you of any changes in the foregoing subsequent to the date of this opinion.

 

We hereby consent to the filing of this opinion as an exhibit to the Company’s Current Report on Form 8-K filed with the Commission on August 24, 2023 and to the reference to this firm under the caption “Legal Matters” in the Registration Statement and the Prospectus Supplement. In giving such consent, we do not thereby admit that we are in the category of persons whose consent is required under Section 7 of the Securities Act or the rules and regulations of the Commission thereunder.

 

Very truly yours,
/s/ Dechert LLP

 

 

v3.23.2

Cover	Aug. 24, 2023
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	Aug. 24, 2023
Entity File Number	814-00967
Entity Registrant Name	WhiteHorse Finance, Inc.
Entity Central Index Key	0001552198
Entity Tax Identification Number	45-4247759
Entity Incorporation, State or Country Code	DE
Entity Address, Address Line One	1450 Brickell Avenue
Entity Address, Address Line Two	31st Floor
Entity Address, City or Town	Miami
Entity Address, State or Province	FL
Entity Address, Postal Zip Code	33131
City Area Code	305
Local Phone Number	381-6999
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common Stock, par value $0.001 per share
Trading Symbol	WHF
Security Exchange Name	NASDAQ
Entity Emerging Growth Company	false

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