SLR INVESTMENT CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
December 31, 2021
(in thousands, except share amounts)
transaction, SLR Equipment refinanced its existing senior secured credit facility into a $150,000 non-recourse facility with an accordion feature to expand
up to $250,000. In September 2019, SLR Equipment amended the facility, increasing commitments to $213,957 with an accordion feature to expand up to $313,957 and extended the maturity date of the facility to July 31, 2023.
As of December 31, 2021, SLR Equipment had 135 funded equipment-backed leases and loans to 61 different customers with a total net
investment in leases and loans of approximately $210,986 on total assets of $264,007. As of December 31, 2020, NEF had 138 funded equipment-backed leases and loans to 61 different customers with a total net investment in leases and loans of
approximately $188,448 on total assets of $263,443. As of December 31, 2021 and December 31, 2020, the largest position outstanding totaled $19,207 and $25,103, respectively. For the same periods, the average exposure per customer was
$3,459 and $3,089, respectively. SLR Equipments credit facility, which is non-recourse to the Company, had approximately $118,002 and $100,569 of borrowings outstanding at December 31, 2021 and
December 31, 2020, respectively. For the years ended December 31, 2021, 2020 and 2019, SLR Equipment had net losses of $9,729, $8,883 and $6,023, respectively on gross income of $22,931, $24,512 and $31,928, respectively. Due to
timing and non-cash items, there may be material differences between GAAP net income and cash available for distributions. SLR Equipments consolidated financial statements for the fiscal years ended
December 31, 2021 and December 31, 2020 are attached as an exhibit to this annual report on Form 10-K.
Note 13. Capital Share Transactions
As
of December 31, 2021 and December 30, 2020, 200,000,000 shares of $0.01 par value capital stock were authorized.
There were no
transactions in capital stock during the years ended December 31, 2021 and December 30, 2020.
Note 14. Kingsbridge Holdings, LLC
On November 3, 2020, the Company acquired an 87.5% equity interest in Kingsbridge Holdings, LLC (KBH) through KBH Topco LLC
(KBHT), a newly formed Delaware corporation. KBH is a residual focused independent mid-ticket lessor of equipment primarily to U.S. investment grade companies. The Company invested
$216,596 to effect the transaction, of which $136,596 was invested to acquire 87.5% of KBHTs equity and $80,000 in KBHs debt. The existing management team of KBH committed to continue to lead KBH after the transaction. Post the
transaction, the Company owns 87.5% of KBHT equity and the KBH management team owns the remaining 12.5% of KBHTs equity.
As of
December 31, 2021 and 2020, KBHT had total assets of $738,425 and $744,684, respectively. For the same periods, debt recourse to KBHT totaled $216,881 and $219,044, respectively, and non-recourse debt
totaled $323,844 and $335,899, respectively. For the year ended December 31, 2021 and the period November 3, 2020 through December 31, 2020, KBHT had net income of $12,151 and $2,170, respectively, on gross income of $245,889 and
$43,618, respectively. Due to timing and non-cash items, there may be material differences between GAAP net income and cash available for distributions. As such, and subject to fluctuations in KBHTs
funded commitments, the timing of originations, and the repayments of financings, the Company cannot guarantee that KBHT will be able to maintain consistent dividend payments to us. KBHTs consolidated financial statements for the year ended
December 31, 2021 and the period November 3, 2020 to December 31, 2020 are attached as an exhibit to this annual report on Form 10-K.
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