Sixth Street Specialty Lending, Inc. · NYSE:TSLX
Sixth Street Specialty Lending — TPG Specialty Lending — Proxy Contest (April 2018)
14 slides from Sixth Street Specialty Lending's proxy contest presentation, Apr 13, 2018
Slide 1: Expanding Tools for Value Creation and Financial Flexibility
TPG Specialty Lending Expanding Tools for Value Creation and Financial Flexibility April 2018 ht t p://www.t pgspe cia lt yle ndi ng.com/
Slide 2: Disclaimer and Forward-Looking Statement
Disclaimer and Forward-Looking Statement General Disclaimer The information containe d in this prese ntation (the “Presentation”) is pre liminary, may not be comple te and may be change d. By acce ptance here of, you agree that the information containe d he rein may not be use d, re produce d or dis
Slide 3: Special Meeting of TSLX Stockholders
Special Meeting of TSLX Stockholders To Our Stockholders: We will be holding a Special Meeting of Stockholders of TPG Specialty Lending, Inc. on May 17, 2018, at 9:30 AM, local time, at the offices of TPG, 888 7th Avenue. Floor 35, New York, NY 10106. At the meeting, you will be asked to consider an
Slide 4: Market Conditions May Create Attractive Investment Opportunities
Market Conditions May Create Attractive Investment Opportunities (1) (2) Average BDC P/NAV BAML HY Index (OAS) 1.1x 7.5% 7.0% 1.0x 6.5%—NAV BAML to P/NAV = 1.0x 6.0% - 1.0x US HY Price BDC 5.5% Index e 0.9x Averag 5.0% (OAS) 4.5% 0.9x 4.0% 0.8x 3.5% Dec ‘14 May ‘15 Oct ‘15 Mar ‘16 Aug ‘16 Jan ‘17 Ju
Slide 5: Track Record of Strong Performance: Total Returns Since TSLX IPO
Reasons For TSLX to Have Flexibility to Sell Common Stock Below NAV 1 Total Returns (since TSLX IPO) Track Record of 90.0% (1) (2) (3) TSLX Wells Fargo BDC Index S&P 500 High Yield Leveraged Loans Strong Performance 70.0% 63.0% 50.0% 51.8% 30.0% 19.0% 16.1% 10.0% 9.1% (10.0%) (30.0%) Mar-14 Jun-14 S
Slide 6: Track Record of Strong Performance: Total Returns Since TSLX IPO
Reasons For TSLX to Have Flexibility to Sell Common Stock Below NAV 1 Total Returns (since TSLX IPO) Track Record of Strong $1.63 TSLX Total Returns Outperformance Performance (since IP O) versus: Wells Fargo BDC Index: +53 points $1.52 Leveraged Loans: +46 points High Yield: +44 points S&P 500: +11
Slide 7: Equity Raise Discipline
Reasons For TSLX to Have Flexibility to Sell Common Stock Below NAV Equity Raise Discipline 1.55x (1) TSLX BDC Peers 1.40x TSLX Average: 1.16x Book 1.25x 2 to -Price—1.10x Disciplined 0.95x Capital Allocation 0.80x BDC Peers Average: 0.92x 0.65x Mar ‘14 Jul ‘14 Nov ‘14 Mar ‘15 Jul ‘15 Nov ‘15 Mar ‘1
Slide 8: Equity Raise Discipline (March 2018)
Reasons For TSLX to Have Flexibility to Sell Common Stock Below NAV Equity Raise Discipline (March 2018) 14.3% 12.2% 13.0% 2 10.7% 9.2% Disciplined 8.9% Capital Allocation Cost of New Implied Yield on New ROE on New Equity(1) Breakeven Yield Assets (3) Equity(4) on New Assets(2) 1) Reflects base div
Slide 9: Flexibility to Sell Common Stock Below NAV
Reasons For TSLX to Have Flexibility to Sell Common Stock Below NAV Flexibility for the Company to sell its common stock below NAV is in the Company’s best interests and the best interests of its stockholders as it would provide: Access to the capital markets to pursue attractive investment opportun
Slide 10: Analysis Framework: Illustrative NAV Dilution
Reasons For TSLX to Have Flexibility to Sell Common Stock Below NAV Analysis Framework (2) Illustrative NAV Dilution (%) % of Shares Outstanding Issued -0.91% 5.0% 7.5% 10.0% 12.5% o 2.5% (0.1%) (0.2%) (0.2%) (0.3%) t (1) in nt 5.0% (0.2%) (0.3%) (0.5%) (0.6%) l—V l ou A A c 7.5% (0.4%) (0.5%) (0.7%
Slide 11: Analysis Framework: Illustrative ROE Accretion / (Dilution)
Reasons For TSLX to Have Flexibility to Sell Common Stock Below NAV Analysis Framework (2) Illustrative ROE Accretion / (Dilution) on New Investments (%) All-in Yield on New Assets 2.44% 10.0% 11.0% 12.0% 13.0% 14.0% 15.0% o 2.5% 0.3% 1.8% 3.3% 4.8% 6.2% 7.7% t (1 ) in nt 5.0% 0.0% 1.5% 3.0% 4.5% 6.
Slide 12: Analysis Framework: Illustrative Payback Period
Reasons For TSLX to Have Flexibility to Sell Common Stock Below NAV Analysis Framework (2) Illustrative Payback Period (Years) on Equity Raise All-in Yield on New Assets 2.95 10.0% 11.0% 12.0% 13.0% 14.0% 15.0% o 2.5% 6.1 1.0 0.6 0.4 0.3 0.2 t ) n t (1 n i—5.0% 106.7 2.4 1.2 0.8 0.6 0.5 u A ll AV sc
Slide 13: To Vote
To Vote The proxy statement is now available. You may use one of the following methods to provide your voting instructions: Vote by Internet: Online at www.proxyvote.com. Have your control number listed on the proxy card or voting instruction form ready and follow the instructions; or Vote by Teleph
Slide 14: Contact Us
Contact Us: For assistance voting your TSLX shares: D.F. King Toll-free at (800) 347-4750 or Collect at (212) 269-5550 For other questions: TSLX Investor Relations IRTSL@tpg.com (212) 601-4753 (212) 601-4739