Msc Income Fund, Inc. · NYSE:MSIF
Msc Income Fund — HMS Income Fund — Corporate Update (July 2020)
30 slides from Msc Income Fund's corporate update, Jul 2, 2020
Slide 1: HMS Income Fund Update Webcast
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Slide 2: Dugan Fife and Ali Palomo
Dugan Fife Ali Palomo Senior Managing Director, Chief Investment Officer, Hines Securities HMS Income Fund HMS Income Fund is closed to new investors. Hines Securities, Inc., Member FINRA/SIPC, was the dealer manager for HMS Income Fund's public offerings. 07/20 1
Slide 3: Fund Updates
Fund Updates # Portfolio Snapshot = Impact of COVID-19 = Positioning for the Future HMS Income Fund is closed to new investors. Hines Securities, Inc., Member FINRA/SIPC, was the dealer manager for HMS Income Fund's public offerings. 07/20 2
Slide 4: 3/31/20 Portfolio Highlights
3/31/20 Portfolio Highlights = 130 Debt Portfolio Aggregate Fair $894.9M Market Value 211 Portfolio / Investments’ = 73 Equity = 8 Other First Lien Debt as % of Total Debt Fair Market Value Weighted Avg. Effective Yield on Investments nlevered)? 93.3% 8.3% ‘Portfolio holdings are subject to change.
Slide 5: Portfolio Composition
Portfolio Composition! Lien Priority Debt Interest Rate Type HMS Income Fund has one of the largest first lien Focus on variable structure provides upside in times concentrations among non-traded BDCs? of rising interest rates Unsecured 1.6% Second Lien 4.09 % First Lien 76.9% Variable 86.5% ‘Data b
Slide 6: Impact of COVID-19
IMPACT OF COVID-19 HMS Income Fund is closed to new investors. Hines Securities, Inc., Member FINRA/SIPC, was the dealer manager for HMS Income Fund's public offerings. 07/20 5
Slide 7: Impact of COVID-19
Impact of COVID-19 Navigating unprecedented headwinds 1. Decline in investment yields 2. Limitations on borrowing capacity including credit facilities 3. Performance of portfolio companies HMS Income Fund is closed to new investors. Hines Securities, Inc., Member FINRA/SIPC, was the dealer manager f
Slide 8: Distribution Coverage
Distribution Coverage Period FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 YTD 2020 ‘Calculated as estimated taxable income/stockholder distributions declared. 2$56K of net realized income; no distributions declared. SRepresents cumulative distribution coverage from 2011 th
Slide 9: Distribution Update
Distribution Update = The Board and management determined that most prudent decision to preserve the integrity of the Fund and long-term returns for our shareholders is temporary suspension of the distribution at this time = Suspended after the July 1, 2020 distribution Any future distributions are
Slide 10: Positioning for the Future
POSITION FOR THE FUTURE HMS Income Fund is closed to new investors. Hines Securities, Inc., Member FINRA/SIPC, was the dealer manager for HMS Income Fund's public offerings. 07/20 9
Slide 11: Positioning for the Future
Positioning for the Future Transition of the Investment Adviser Role to Main Street Capital = Why Main Street Capital? = Its affiliates have served as the Fund’s investment sub-adviser and held a seat on its Board of Directors since Fund’s launch in 2012 = Main Street’s publicly traded BDC is one of
Slide 12: Positioning for the Future
Positioning for the Future Transition of the Investment Adviser Role to Main Street Capital « What does this mean for my client? = Reduction in annual asset management fee from 2.00% to 1.75% = Fund oversight from team with deep public markets expertise = Same target liquidity event window = Commitm
Slide 13: Closing
Closing Next Steps = Proxy mailing to be distributed to shareholders « Annual meeting expected to be held in October 2020 HMS Income Fund is closed to new investors. Hines Securities, Inc., Member FINRA/SIPC, was the dealer manager for HMS Income Fund's public offerings. 07/20 12
Slide 14: Thank You
THANK YOU Contact Us: 888.446.3773 HMS Income Fund is closed to new investors. Hines Securities, Inc., Member FINRA/SIPC, was the dealer manager for HMS Income Fund's public offerings. 07/20 13
Slide 15: Disclosures
Disclosures Additional Information and Where to Find It This communication relates to a proposed new investment advisory agreement for HMS (the “Proposal’) and may be deemed to be solicitation material in respect of the Proposal. In connection with the Proposal, HMS has filed a preliminary proxy sta
Slide 16: Ali Palomo | Dugan Fife
Ali Palomo | ChiefInvestment Officer © Dugan Fife | Senior Managing Director Institutional and Retail Sales Distribution Statements included in this presentation that are not historical facts, are forward!-looking statements under the U.S. securities laws. These statements are only predictions based
Slide 17: Welcome
WELCOME Dugan Fife Ali Palomo. Senior Managing Director, Chief Investment Officer, Hines Securities HMS Income Fund resto ‘SIPC, was the dealer manager for HMS Income Funds public offerings. 0720 1 Welcome to the Hines/HMS webcast. | am Dugan Fife, senior managing director of distribution for Hines
Slide 18: Fund Updates
Fund Updates = Portfolio Snapshot = Impact of COVID-19 = Positioning for the Future HMs Inoome Fundie closed to naw investos Hines Secures, nc, Member FINRAVSIFC, ma: the dealer manager for HMS Income Funds publi ofrings. 07720 2 During this presentation we will provide you with a portfolio snapshot
Slide 19: 3/31/20 Portfolio Highlights
3/31/20 Portfolio Highlights * 130 Debt $894.9M = 73 Equity = 8 Other 93.3% 8.3% ‘Portfolio holdings are subject to change. "Weighted average effective yield is calculated based on HMS Income Fund’s investments as of March 31, 2020 and includes aceretion of original issue discounts and amortization
Slide 20: Portfolio Composition
Portfolio Composition! Lien Priority Debt Interest Rate Type HMS Income Fund has one of the largest first lien Focus on variable structure provides upside in times concentrations arnong non-traded BDCs? of rising interest rates Unsecured 1.6% Second Lien 4.0% First Lien 76.9% Variable 86.5% ‘Data ba
Slide 21: Impact of COVID-19
IMPACT OF COVID-19 HMs Inoome Fundie closed to naw investos Hines Securities, Inc., Member FINRAVSIPC, was the dealer manager for HMS Income Funds public offerings. O7/20 5 As concerns about COVID-19 continue to impact the world economy, we wanted you to hear from the Fund’s Chief Investment Officer
Slide 22: Impact of COVID-19
Impact of COVID-19 Navigating unprecedented headwinds Tenber FRRMSPC, var Me kakr mavager br MS Noone Flags plbbbotegr.ta0 6 Thanks Dugan — COVID-19 has certainly taken a toll from a humanitarian and economic standpoint. In relation to the fund, you will see on this slide the three headwinds we are
Slide 23: Distribution Coverage
Distribution Coverage Period Distribution Coverage" FY2011 Niaz Fy 2012 106.2% 100.0%? FY 2013 93.4% FY 2014 100.3% FY 2015 1.1% FY 2016 107.1% FY 2017 114.3% FY 2018 110.0% FY 2019 93.9% YTD 2020 86.3% ‘Calculated as estimated taxable incomelstockholder distributions declared. 2$56K of net realized
Slide 24: Distribution Update
Distribution Update = The Board and management determined that most prudent decision to preserve the integrity of the Fund and long-term returns for our shareholders is temporary suspension of the distribution at this time = Suspended after the July 1, 2020 distribution = Any future distributions ar
Slide 25: Position for the Future
POSITION FOR THE FUTURE HMs Inoome Fundie closed to naw investos Hines Securities, Inc., Member FINRAVSIPC, was the dealer manager for HMS Income Funds public offerings. O7/20 3 While our efforts are on addressing the preliminary and projected impact of the pandemic on the Fund we’ve continued to ev
Slide 26: Positioning for the Future
Positioning for the Future Transition of the Investment Adviser Role to Main Street Capital indie closed to naw investors inc, Member FINRAVSIPC, war the dealer manager for HMS Inoome Funds public offerings. 0720 10 You will find in our preliminary draft of our annual proxy statement information rel
Slide 27: Positioning for the Future
Positioning for the Future Transition of the Investment Adviser Role to Main Street Capital resto SIPC, war the dealer manager for HMS Inoome Funds public offerings. 0720 cr So what does this mean for your client? HMS shareholders will benefit from a change in the Fund’s fee structure. If the transi
Slide 28: Closing
Closing NSE CSCS = Proxy mailing to be distributed to shareholders = Annual meeting expected to be held in October 2020 resto SIPC, war the dealer manager for HMS Inoome Funds public offerings. 0720 In closing, | wanted to provide some context of the next steps. Our goal will be mailing the HMS prox
Slide 29: Thank You
THANK YOU Contact Us: 888.446.3773 resto ‘SIPC, was the dealer manager for HMS Income Funds public offerings. 0720 13 | do want to thank you for taking the time to review this presentation. If you have additional questions, please feel free to reach out to your territory team here at Hines Securitie
Slide 30: Disclosures
Disclosures Additional Information and Where to Find It This communication relates to a proposed new investment advisory agreement for HMS (the "Propasal) and may be deemed to he solicitation material in respect ofthe Proposal. In connection with the Proposal, HM has filed a preliminary proxy statem