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EX-31.2 - EX-31.2 - New Mountain Finance Corpnmfc-033121xex312.htm
EX-32.2 - EX-32.2 - New Mountain Finance Corpnmfc-033121xex322.htm
EX-32.1 - EX-32.1 - New Mountain Finance Corpnmfc-033121xex321.htm
EX-31.1 - EX-31.1 - New Mountain Finance Corpnmfc-033121xex311.htm

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
ý      Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
For the Quarter Ended March 31, 2021
o         Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Commission
File Number
 Exact name of registrant as specified in its charter, address of principal executive
offices, telephone numbers and states or other jurisdictions of incorporation or organization
 I.R.S. Employer
Identification Number
814-00832 New Mountain Finance Corporation 27-2978010
  1633 Broadway, 48th Floor
New York, New York 10019
Telephone: (212) 720-0300
State of Incorporation: Delaware
  
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common stock, par value $0.01 per shareNMFCThe NASDAQ Global Select Market
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 (the "Exchange Act") during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý No o
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes o No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
 
Large accelerated filer ý
 
Accelerated filer o
 
Non-accelerated filer o
 
Smaller reporting company o
Emerging growth company o
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. o
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No ý

Indicate the number of shares outstanding of each of the issuer’s classes of common stock.
Description Shares as of May 5, 2021
Common stock, par value $0.01 per share 96,827,342


FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 2021
TABLE OF CONTENTS
 PAGE
  
 
   
  
 
 
 
 
 
 
 
 
  
 
 
 
2

PART I. FINANCIAL INFORMATION
Item 1.    Financial Statements
New Mountain Finance Corporation
 
Consolidated Statements of Assets and Liabilities
(in thousands, except shares and per share data)
(unaudited)
 March 31, 2021December 31, 2020
Assets  
Investments at fair value  
Non-controlled/non-affiliated investments (cost of $2,275,442 and $2,281,184, respectively)$2,252,144 $2,249,615 
Non-controlled/affiliated investments (cost of $104,959 and $115,543, respectively)121,470 103,012 
Controlled investments (cost of $648,906 and $600,942, respectively)644,998 600,875 
Total investments at fair value (cost of $3,029,307 and $2,997,669, respectively)3,018,612 2,953,502 
Securities purchased under collateralized agreements to resell (cost of $30,000 and $30,000, respectively)21,422 21,422 
Cash and cash equivalents47,299 78,966 
Interest and dividend receivable32,927 28,411 
Receivable from unsettled securities sold— 9,019 
Receivable from affiliates— 117 
Deferred tax asset— 101 
Other assets8,075 5,981 
Total assets$3,128,335 $3,097,519 
Liabilities  
Borrowings
     Unsecured Notes$511,500 $453,250 
     Holdings Credit Facility450,163 450,163 
     SBA-guaranteed debentures300,000 300,000 
     Convertible Notes201,494 201,520 
     DB Credit Facility201,000 244,000 
     NMFC Credit Facility107,000 165,500 
     Deferred financing costs (net of accumulated amortization of $35,513 and $33,325, respectively)(18,270)(16,839)
Net borrowings1,752,887 1,797,594 
Payable for unsettled securities purchased62,863 26,842 
Management fee payable20,202 10,419 
Incentive fee payable14,602 7,354 
Interest payable9,826 15,587 
Payable to affiliates1,538 867 
Deferred tax liability14 — 
Other liabilities3,605 1,967 
Total liabilities1,865,537 1,860,630 
Commitments and contingencies (See Note 9)  
Net assets  
Preferred stock, par value $0.01 per share, 2,000,000 shares authorized, none issued
— — 
Common stock, par value $0.01 per share, 200,000,000 shares authorized, and 96,827,342 and 96,827,342 shares issued and outstanding, respectively968 968 
Paid in capital in excess of par1,269,671 1,269,671 
Accumulated overdistributed earnings(26,322)(48,764)
Total net assets of New Mountain Finance Corporation$1,244,317 $1,221,875 
Non-controlling interest in New Mountain Net Lease Corporation18,481 15,014 
Total net assets$1,262,798 $1,236,889 
Total liabilities and net assets$3,128,335 $3,097,519 
Number of shares outstanding96,827,342 96,827,342 
Net asset value per share of New Mountain Finance Corporation$12.85 $12.62 
The accompanying notes are an integral part of these consolidated financial statements.
3

New Mountain Finance Corporation
 
Consolidated Statements of Operations
(in thousands, except shares and per share data)
(unaudited)
Three Months Ended
March 31, 2021March 31, 2020
Investment income
From non-controlled/non-affiliated investments:
Interest income (excluding Payment-in-kind ("PIK") interest income)$39,560 $56,560 
PIK interest income2,534 1,026 
Non-cash dividend income2,401 2,324 
Other income2,824 1,471 
From non-controlled/affiliated investments:
Interest income (excluding PIK interest income)463 612 
PIK interest income— 457 
Dividend income— 720 
Non-cash dividend income1,505 (3,418)
Other income102 291 
From controlled investments:
Interest income (excluding PIK interest income)1,148 974 
PIK interest income3,304 2,007 
Dividend income10,475 8,229 
Non-cash dividend income1,281 2,638 
Other income2,111 193 
Total investment income67,708 74,084 
Expenses
Incentive fee7,248 7,826 
Management fee13,420 13,858 
Interest and other financing expenses19,385 22,194 
Administrative expenses1,129 1,040 
Professional fees726 905 
Other general and administrative expenses442 499 
Total expenses42,350 46,322 
Less: management fee waived (See Note 5) (3,637)(3,543)
Net expenses38,713 42,779 
Net investment income before income taxes28,995 31,305 
Income tax expense— 
Net investment income28,994 31,305 
Net realized (losses) gains:
Non-controlled/non-affiliated investments181 (702)
Non-controlled/affiliated investments(12,212)— 
Controlled investments1,535 
New Mountain Net Lease Corporation— 812 
Net change in unrealized appreciation (depreciation):
Non-controlled/non-affiliated investments8,271 (140,283)
Non-controlled/affiliated investments29,042 (10,836)
Controlled investments(3,841)(52,808)
New Mountain Net Lease Corporation— (812)
(Provision) benefit for taxes (115)898 
Net realized and unrealized gains (losses)22,861 (203,727)
Net increase (decrease) in net assets resulting from operations51,855 (172,422)
Less: Net (increase) decrease in net assets resulting from operations related to non-controlling interest in New Mountain Net Lease Corporation(365)65 
Net increase (decrease) in net assets resulting from operations related to New Mountain Finance Corporation$51,490 $(172,357)
Basic earnings (loss) per share$0.53 $(1.78)
Weighted average shares of common stock outstanding - basic (See Note 11)
96,827,342 96,827,342 
Diluted earnings (loss) per share$0.49 $(1.78)
Weighted average shares of common stock outstanding - diluted (See Note 11)
110,084,927 110,084,927 
Distributions declared and paid per share$0.30 $0.34 
The accompanying notes are an integral part of these consolidated financial statements.
4

New Mountain Finance Corporation
 
Consolidated Statements of Changes in Net Assets
(in thousands, except shares and per share data)
(unaudited)
Three Months Ended
March 31, 2021March 31, 2020
Increase (decrease) in net assets resulting from operations:
Net investment income$28,994 $31,305 
Net realized (losses) gains on investments and New Mountain Net Lease Corporation ("NMNLC")(10,496)114 
Net change in unrealized appreciation (depreciation) of investments and NMNLC33,472 (204,739)
(Provision) benefit for taxes(115)898 
Net increase (decrease) in net assets resulting from operations51,855 (172,422)
Less: Net (increase) decrease in net assets resulting from operations related to non-controlling interest in NMNLC(365)65 
Net increase (decrease) in net assets resulting from operations related to New Mountain Finance Corporation51,490 (172,357)
Capital transactions
Distributions declared to stockholders from net investment income(29,048)(32,921)
Total net decrease in net assets resulting from capital transactions(29,048)(32,921)
Net increase (decrease) in net assets22,442 (205,278)
New Mountain Finance Corporation net assets at the beginning of the period1,221,875 1,283,468 
New Mountain Finance Corporation net assets at the end of the period 1,244,317 1,078,190 
Non-controlling interest in NMNLC18,481 11,250 
Net assets at the end of the period$1,262,798 $1,089,440 
Capital share activity
Shares issued from the reinvestment of distributions— — 
Net increase in shares outstanding— — 


The accompanying notes are an integral part of these consolidated financial statements.
5

New Mountain Finance Corporation
 
Consolidated Statements of Cash Flows
(in thousands)
(unaudited)
Three Months Ended
March 31, 2021March 31, 2020
Cash flows from operating activities
Net increase (decrease) in net assets resulting from operations$51,855 $(172,422)
Adjustments to reconcile net decrease (increase) in net assets resulting from operations to net cash provided by (used in) operating activities:
Net realized losses (gains) on investments and New Mountain Net Lease Corporation ("NMNLC")10,496 (114)
Net change in unrealized (appreciation) depreciation of investments and NMNLC(33,472)204,739 
Amortization of purchase discount
(1,978)(3,528)
Amortization of deferred financing costs
2,315 1,152 
Amortization of premium on Convertible Notes
(26)(26)
Non-cash investment income
(11,091)(5,131)
(Increase) decrease in operating assets:
Proceeds from sale of non-controlling interest in NMNLC— 11,315 
Purchase of investments and delayed draw facilities
(222,985)(172,921)
Proceeds from sales and paydowns of investments
197,671 178,722 
Cash received for purchase of undrawn portion of revolving credit or delayed draw facilities
36 211 
Cash paid for purchase of drawn portion of revolving credit facilities
(483)(8,996)
Cash paid on drawn revolvers
(13,806)(33,639)
Cash repayments on drawn revolvers
10,502 9,620 
Deferred tax asset101 — 
Interest and dividend receivable
(4,516)(850)
Receivable from unsettled securities sold
9,019 (30,964)
Receivable from affiliates
117 (268)
Other assets
(2,094)(802)
Increase (decrease) in operating liabilities:
Management fee payable9,783 10,315 
Incentive fee payable7,248 7,826 
Payable for unsettled securities purchased36,021 (1,780)
Payable to affiliates671 352 
Interest payable(5,761)(5,519)
Deferred tax liability14 (898)
Other liabilities1,550 74 
Contributions related to non-controlling interest in NMNLC3,102 — 
Net cash flows provided by (used in) operating activities44,289 (13,532)
Cash flows from financing activities
Distributions paid(29,048)(32,921)
Proceeds from Holdings Credit Facility— 16,000 
Repayment of Holdings Credit Facility— (108,400)
Proceeds from Unsecured Notes200,000 — 
Repayment of Unsecured Notes(141,750)— 
Proceeds from SBA-guaranteed debentures— 75,000 
Proceeds from NMFC Credit Facility157,000 — 
Repayment of NMFC Credit Facility(215,500)— 
Proceeds from DB Credit Facility40,000 40,000 
Repayment of DB Credit Facility(83,000)— 
Deferred financing costs paid(3,658)(2,613)
Net cash flows used in by financing activities(75,956)(12,934)
Net decrease in cash and cash equivalents(31,667)(26,466)
Cash and cash equivalents at the beginning of the period78,966 48,574 
Cash and cash equivalents at the end of the period$47,299 $22,108 
Supplemental disclosure of cash flow information
Cash interest paid$22,245 $26,301 
Income taxes paid— 
Non-cash financing activities:
Accrual for offering costs$— $86 
Accrual for deferred financing costs88 

The accompanying notes are an integral part of these consolidated financial statements.
6

New Mountain Finance Corporation
 
Consolidated Schedule of Investments
March 31, 2021
(in thousands, except shares)
(unaudited)
Portfolio Company, Location and Industry (1)Type of InvestmentInterest Rate (13)Acquisition DateMaturity / Expiration Date Principal
 Amount,
 Par Value
 or Shares
 Cost Fair
 Value
Percent of Net
Assets
Non-Controlled/Non-Affiliated Investments
Funded Debt Investments - Canada
Dentalcorp Health Services ULC (fka Dentalcorp Perfect Smile ULC)**
Healthcare ServicesSecond lien (3)8.50% (L + 7.50%/M)6/1/20186/8/2026$28,613 $28,425 $28,648 
Second lien (8)8.50% (L + 7.50%/M)6/1/20186/8/20267,500 7,453 7,509 
36,113 35,878 36,157 2.86 %
Total Funded Debt Investments - Canada$36,113 $35,878 $36,157 2.86 %
Funded Debt Investments - United Arab Emirates
GEMS Menasa (Cayman) Limited**
EducationFirst lien (8)6.00% (L + 5.00%/S)7/30/20197/31/2026$15,638 $15,574 $15,619 1.24 %
Total Funded Debt Investments - United Arab Emirates$15,638 $15,574 $15,619 1.24 %
Funded Debt Investments - United Kingdom
Aston FinCo S.a r.l. / Aston US Finco, LLC**
SoftwareSecond lien (8)(11)8.36% (L + 8.25%/M)10/8/201910/8/2027$34,459 $34,220 $34,804 2.76 %
Total Funded Debt Investments - United Kingdom$34,459 $34,220 $34,804 2.76 %
Funded Debt Investments - United States
GS Acquisitionco, Inc.
SoftwareFirst lien (2)(11)6.75% (L + 5.75%/Q)8/7/20195/24/2024$26,571 $26,457 $26,570 
First lien (2)(11)6.75% (L + 5.75%/S)8/7/20195/24/202425,885 25,762 25,885 
First lien (5)(11)6.75% (L + 5.75%/Q)8/7/20195/24/202422,137 22,041 22,137 
First lien (2)(11)6.75% (L + 5.75%/S)8/7/20195/24/202412,618 12,551 12,618 
First lien (3)(11)(12) - Drawn6.75% (L + 5.75%/S)8/7/20195/24/20242,438 2,423 2,438 
89,649 89,234 89,648 7.11 %
Associations, Inc.
Business ServicesFirst lien (2)(11)8.00% (L + 4.00% + 3.00% PIK/Q)*7/30/20187/30/202452,963 52,776 52,963 
First lien (8)(11)8.00% (L + 4.00% + 3.00% PIK/Q)*7/30/20187/30/20245,314 5,295 5,314 
First lien (2)(11)(12) - Drawn8.00% (L + 4.00% + 3.00% PIK/Q)*7/30/20187/30/202410,500 10,456 10,500 
First lien (2)(11)(12) - Drawn7.00% (L + 6.00%/Q)7/30/20187/30/20242,033 2,020 2,033 
70,810 70,547 70,810 5.61 %
PhyNet Dermatology LLC
Healthcare ServicesFirst lien (2)(11)7.50% (L + 5.50% + 1.00% PIK/M)*9/17/20188/16/202449,744 49,437 49,169 
First lien (3)(11)7.50% (L + 5.50% + 1.00% PIK/M)*9/17/20188/16/202419,080 18,929 18,859 
68,824 68,366 68,028 5.39 %
The accompanying notes are an integral part of these consolidated financial statements.
7

New Mountain Finance Corporation
 
Consolidated Schedule of Investments (Continued)
March 31, 2021
(in thousands, except shares)
(unaudited)

Portfolio Company, Location and Industry (1)Type of InvestmentInterest Rate (13)Acquisition DateMaturity / Expiration Date Principal
 Amount,
 Par Value
 or Shares
 Cost Fair
 Value
Percent of Net
Assets
ConnectWise, LLC
SoftwareFirst lien (2)(11)6.25% (L + 5.25%/Q)11/26/20192/28/2025$54,914 $54,648 $54,914 
First lien (3)(11)(12) - Drawn6.25% (L + 5.25%/M)11/26/20192/28/2025265 264 265 
55,179 54,912 55,179 4.38 %
CentralSquare Technologies, LLC
SoftwareSecond lien (3)7.70% (L + 7.50%/Q)8/15/20188/31/202647,838 47,377 46,283 
Second lien (8)7.70% (L + 7.50%/Q)8/15/20188/31/20267,500 7,428 7,256 
55,338 54,805 53,539 4.24 %
iCIMS, Inc.
SoftwareFirst lien (8)(11)7.50% (L + 6.50%/S)9/12/20189/12/202441,636 41,358 41,857 
First lien (8)(11)7.50% (L + 6.50%/S)6/14/20199/12/20248,667 8,606 8,713 
First lien (3)(11)(12) - Drawn7.50% (L + 6.50%/S)9/12/20189/12/20242,915 2,886 2,915 
53,218 52,850 53,485 4.24 %
Salient CRGT Inc.
Federal ServicesFirst lien (2)(11)7.50% (L + 6.50%/S)1/6/20152/28/202237,348 37,238 37,348 
First lien (8)(11)7.50% (L + 6.50%/S)6/6/20192/28/202212,762 12,576 12,762 
50,110 49,814 50,110 3.97 %
Integro Parent Inc.
Business ServicesFirst lien (2)(11)6.75% (L + 5.75%/M)10/9/201510/31/202234,364 34,290 34,364 
First lien (3)(11)(12) - Drawn4.36% (L + 4.25%/M)6/8/20184/30/20223,938 3,918 3,938 
Second lien (8)(11)10.25% (L + 9.25%/M)10/9/201510/30/202310,000 9,958 10,000 
48,302 48,166 48,302 3.82 %
NM GRC Holdco, LLC
Business ServicesFirst lien (2)(11)8.50% (L + 6.00% + 1.50% PIK/Q)*2/9/20182/9/202438,414 38,313 37,719 
First lien (2)(11)8.50% (L + 6.00% + 1.50% PIK/Q)*2/9/20182/9/202410,677 10,647 10,484 
49,091 48,960 48,203 3.82 %
Frontline Technologies Group Holdings, LLC
SoftwareFirst lien (4)(11)6.75% (L + 5.75%/Q)9/18/20179/18/202321,884 21,808 21,884 
First lien (2)(11)6.75% (L + 5.75%/Q)9/18/20179/18/202318,443 18,404 18,443 
First lien (2)(11)6.75% (L + 5.75%/M)9/18/20179/18/20237,613 7,578 7,613 
47,940 47,790 47,940 3.80 %
Brave Parent Holdings, Inc.
SoftwareSecond lien (5)7.61% (L + 7.50%/M)4/17/20184/17/202622,500 22,420 22,500 
Second lien (2)7.61% (L + 7.50%/M)4/17/20184/17/202616,624 16,503 16,624 
Second lien (8)7.61% (L + 7.50%/M)4/17/20184/17/20266,000 5,956 6,000 
45,124 44,879 45,124 3.57 %
The accompanying notes are an integral part of these consolidated financial statements.
8

New Mountain Finance Corporation
 
Consolidated Schedule of Investments (Continued)
March 31, 2021
(in thousands, except shares)
(unaudited)

Portfolio Company, Location and Industry (1)Type of InvestmentInterest Rate (13)Acquisition DateMaturity / Expiration Date Principal
 Amount,
 Par Value
 or Shares
 Cost Fair
 Value
Percent of Net
Assets
Quest Software US Holdings Inc.
SoftwareSecond lien (2)8.46% (L + 8.25%/Q)5/17/20185/18/2026$43,697 $43,379 $43,685 3.46 %
Tenawa Resource Holdings LLC (15)
Tenawa Resource Management LLC
Specialty Chemicals & MaterialsFirst lien (3)(11)10.50% (Base + 8.00%/Q)5/12/201410/30/202438,500 38,461 38,309 3.03 %
Affinity Dental Management, Inc.
Healthcare ServicesFirst lien (2)(11)7.00% (L + 6.00%/S)9/15/20179/15/202326,153 26,117 26,153 
First lien (4)(11)7.00% (L + 6.00%/S)9/17/20199/15/202310,564 10,564 10,564 
First lien (3)(11)(12) - Drawn7.00% (L + 6.00%/S)9/15/20173/15/20231,738 1,720 1,738 
38,455 38,401 38,455 3.05 %
KAMC Holdings, Inc
Business ServicesSecond lien (2)(11)8.20% (L + 8.00%/Q)8/14/20198/13/202718,750 18,630 18,655 
Second lien (8)(11)8.20% (L + 8.00%/Q)8/14/20198/13/202718,750 18,630 18,656 
37,500 37,260 37,311 2.95 %
CoolSys, Inc.
Industrial ServicesFirst lien (5)7.00% (L + 6.00%/Q)11/20/201911/20/202622,219 22,124 22,219 
First lien (2)7.00% (L + 6.00%/Q)11/20/201911/20/202610,270 10,226 10,270 
First lien (3)7.00% (L + 6.00%/Q)11/20/201911/20/20264,163 4,144 4,163 
36,652 36,494 36,652 2.90 %
Trader Interactive, LLC
Business ServicesFirst lien (2)(11)7.25% (L + 6.25%/Q)6/15/20176/17/202431,524 31,408 31,524 
First lien (8)(11)7.25% (L + 6.25%/Q)6/15/20176/17/20244,886 4,868 4,886 
First lien (3)(11)(12) - Drawn7.25% (L + 6.25%/M)6/15/20176/15/2023112 111 112 
36,522 36,387 36,522 2.89 %
GC Waves Holdings, Inc.**
Business ServicesFirst lien (5)(11)6.75% (L + 5.75%/Q)10/31/201910/31/202522,275 22,141 22,397 
First lien (3)(11)6.75% (L + 5.75%/Q)10/31/201910/31/20259,810 9,721 9,864 
First lien (2)(11)6.75% (L + 5.75%/Q)10/31/201910/31/20253,636 3,614 3,656 
35,721 35,476 35,917 2.84 %
Definitive Healthcare Holdings, LLC
Healthcare Information TechnologyFirst lien (8)(11)6.50% (L + 5.50%/Q)8/7/20197/16/202633,532 33,400 33,531 
First lien (3)(11)(12) - Drawn6.50% (L + 5.50%/Q)8/7/20197/16/20261,324 1,318 1,324 
34,856 34,718 34,855 2.76 %
The accompanying notes are an integral part of these consolidated financial statements.
9

New Mountain Finance Corporation
 
Consolidated Schedule of Investments (Continued)
March 31, 2021
(in thousands, except shares)
(unaudited)

Portfolio Company, Location and Industry (1)Type of InvestmentInterest Rate (13)Acquisition DateMaturity / Expiration Date Principal
 Amount,
 Par Value
 or Shares
 Cost Fair
 Value
Percent of Net
Assets
Diligent Corporation
SoftwareFirst lien (2)(11)6.75% (L + 5.75%/Q)3/30/20218/4/2025$17,896 $17,807 $17,807 
First lien (2)(11)6.75% (L + 5.75%/Q)3/4/20218/4/20259,980 9,930 9,930 
First lien (3)(11)7.25% (L + 6.25%/S)12/19/20188/4/20255,932 5,899 5,959 
33,808 33,636 33,696 2.67 %
Kaseya Inc.
SoftwareFirst lien (8)(11)8.00% (L + 4.00% + 3.00% PIK/S)*5/9/20195/2/202528,449 28,248 28,448 
First lien (3)(11)8.00% (L + 4.00% + 3.00% PIK/S)*5/9/20195/2/20253,330 3,300 3,330 
First lien (3)(11)(12) - Drawn7.50% (L + 6.50%/S)5/9/20195/2/20251,133 1,121 1,133 
32,912 32,669 32,911 2.61 %
Finalsite Holdings, Inc.
SoftwareFirst lien (4)(11)7.50% (L + 6.50%/S)9/28/20189/25/202421,938 21,834 21,938 
First lien (2)(11)7.50% (L + 6.50%/S)9/28/20189/25/202410,835 10,784 10,835 
32,773 32,618 32,773 2.60 %
Ansira Holdings, Inc.
Business ServicesFirst lien (8)(11)7.50% (L + 6.50% PIK/S)*12/19/201612/20/202430,052 29,996 24,588 
First lien (3)(11)7.50% (L + 6.50% PIK/S)*12/19/201612/20/20247,592 7,580 6,212 
37,644 37,576 30,800 2.44 %
Integral Ad Science, Inc.
SoftwareFirst lien (8)(11)6.00% (L + 5.00%/S)7/19/20187/19/202427,216 27,043 27,216 
First lien (3)(11)6.00% (L + 5.00%/S)8/27/20197/19/20243,556 3,531 3,556 
30,772 30,574 30,772 2.44 %
MRI Software LLC
SoftwareFirst lien (5)(11)6.50% (L + 5.50%/Q)1/31/20202/10/202622,273 22,180 22,388 
First lien (3)(11)6.50% (L + 5.50%/Q)1/31/20202/10/20264,642 4,621 4,666 
First lien (2)(11)6.50% (L + 5.50%/Q)1/31/20202/10/20261,611 1,604 1,619 
First lien (3)(11)(12) - Drawn6.50% (L + 5.50%/Q)1/31/20202/10/2026100 100 100 
28,626 28,505 28,773 2.28 %
Keystone Acquisition Corp.
Healthcare ServicesFirst lien (2)6.25% (L + 5.25%/Q)5/10/20175/1/202424,169 24,087 23,323 
Second lien (2)(11)10.25% (L + 9.25%/Q)5/10/20175/1/20254,500 4,472 4,500 
28,669 28,559 27,823 2.20 %
Confluent Health, LLC
Healthcare ServicesFirst lien (2)5.11% (L + 5.00%/M)6/21/20196/24/202627,019 26,912 27,019 2.14 %
The accompanying notes are an integral part of these consolidated financial statements.
10

New Mountain Finance Corporation
 
Consolidated Schedule of Investments (Continued)
March 31, 2021
(in thousands, except shares)
(unaudited)

Portfolio Company, Location and Industry (1)Type of InvestmentInterest Rate (13)Acquisition DateMaturity / Expiration Date Principal
 Amount,
 Par Value
 or Shares
 Cost Fair
 Value
Percent of Net
Assets
HS Purchaser, LLC / Help/Systems Holdings, Inc.
SoftwareSecond lien (5)(11)9.00% (L + 8.00%/Q)11/14/201911/19/2027$22,500 $22,394 $22,613 
Second lien (2)(11)9.00% (L + 8.00%/Q)11/14/201911/19/20274,208 4,171 4,229 
26,708 26,565 26,842 2.13 %
New Trojan Parent, Inc.
Healthcare ServicesSecond lien (2)7.75% (L + 7.25%/M)1/22/20211/5/202926,762 26,630 26,762 2.12 %
RealPage, Inc.**
Business ServicesSecond lien (2)7.25% (L + 6.50%/Q)2/18/20214/23/202925,000 24,813 25,750 2.04 %
Convey Health Solutions, Inc.
Healthcare ServicesFirst lien (4)(11)7.00% (L + 6.00%/Q)9/9/20199/4/202622,163 21,960 22,384 
First lien (2)(11)7.00% (L + 6.00%/Q)2/12/20219/4/20262,643 2,617 2,670 
24,806 24,577 25,054 1.98 %
NMC Crimson Holdings, Inc.
Healthcare ServicesFirst lien (8)6.75% (L + 6.00%/S)3/1/20213/1/202819,259 18,973 18,970 
First lien (2)6.75% (L + 6.00%/S)3/2/20213/1/20284,913 4,840 4,839 
24,172 23,813 23,809 1.89 %
TMK Hawk Parent, Corp.
Distribution & LogisticsFirst lien (2)(11)3.61% (L + 3.50%/M)6/24/20198/28/202416,692 14,866 12,062 
First lien (8)(11)3.61% (L + 3.50%/M)10/23/20198/28/202416,100 13,883 11,634 
32,792 28,749 23,696 1.88 %
Instructure, Inc.
SoftwareFirst lien (8)(11)8.00% (L + 7.00%/Q)3/24/20203/24/202622,667 22,546 23,007 1.82 %
Idera, Inc.
SoftwareSecond lien (4)7.50% (L + 6.75%/S)6/27/20193/2/202922,500 22,189 22,669 1.80 %
Syndigo LLC
SoftwareSecond lien (4)8.75% (L + 8.00%/S)12/14/202012/15/202822,500 22,335 22,613 1.79 %
Astra Acquisition Corp.
SoftwareFirst lien (5)5.50% (L + 4.75%/M)2/26/20203/1/202722,331 22,184 22,499 1.78 %
Cardinal Parent, Inc.
SoftwareFirst lien (4)5.25% (L + 4.50%/S)10/30/202011/12/202712,188 12,100 12,256 
Second lien (4)(11)8.50% (L + 7.75%/S)11/12/202011/13/20289,767 9,672 9,962 
21,955 21,772 22,218 1.76 %
CRCI Longhorn Holdings, Inc.
Business ServicesSecond lien (3)(11)7.36% (L + 7.25%/M)8/2/20188/10/202614,349 14,308 14,349 
Second lien (8)(11)7.36% (L + 7.25%/M)8/2/20188/10/20267,500 7,479 7,500 
21,849 21,787 21,849 1.73 %
Avatar Topco, Inc. (23)
EAB Global, Inc.
EducationSecond lien (3)(11)8.50% (L + 7.50%/S)11/17/201711/17/202513,950 13,811 13,950 
Second lien (8)(11)8.50% (L + 7.50%/S)11/17/201711/17/20257,500 7,425 7,500 
21,450 21,236 21,450 1.70 %
The accompanying notes are an integral part of these consolidated financial statements.
11

New Mountain Finance Corporation
 
Consolidated Schedule of Investments (Continued)
March 31, 2021
(in thousands, except shares)
(unaudited)

Portfolio Company, Location and Industry (1)Type of InvestmentInterest Rate (13)Acquisition DateMaturity / Expiration Date Principal
 Amount,
 Par Value
 or Shares
 Cost Fair
 Value
Percent of Net
Assets
Granicus, Inc.
SoftwareFirst lien (4)(11)7.50% (L + 6.50%/S)1/27/20211/29/2027$15,600 $15,485 $15,483 
First lien (2)(11)7.50% (L + 6.50%/S)1/27/20211/29/20275,952 5,908 5,907 
21,552 21,393 21,390 1.69 %
MED Parentco, LP
Healthcare ServicesSecond lien (8)8.36% (L + 8.25%/M)8/2/20198/30/202720,857 20,722 20,831 1.65 %
YLG Holdings, Inc.
Business ServicesFirst lien (5)(11)7.25% (L + 6.25%/S)11/1/201910/31/202518,183 18,110 18,183 
First lien (5)(11)7.25% (L + 6.25%/S)11/1/201910/31/20252,368 2,357 2,368 
20,551 20,467 20,551 1.63 %
Spring Education Group, Inc (fka SSH Group Holdings, Inc.)
EducationSecond lien (2)8.45% (L + 8.25%/Q)7/26/20187/30/202621,959 21,916 20,450 1.62 %
DG Investment Intermediate Holdings 2, Inc.
Business ServicesSecond lien (3)7.50% (L + 6.75%/M)3/18/20213/30/202920,313 20,262 20,262 1.60 %
DCA Investment Holding, LLC
Healthcare ServicesFirst lien (2)7.00% (L + 6.25%/S)3/12/20213/12/202719,978 19,829 19,828 1.57 %
DiversiTech Holdings, Inc.
Distribution & LogisticsSecond lien (2)8.50% (L + 7.50%/Q)5/18/20176/2/202512,000 11,927 12,060 
Second lien (8)8.50% (L + 7.50%/Q)5/18/20176/2/20257,500 7,454 7,538 
19,500 19,381 19,598 1.55 %
AAC Lender Holdings, LLC (26)
American Achievement Corporation (aka AAC Holding Corp.)
EducationFirst lien (2)(11)7.25% (L + 3.25% PIK + 3.00%/M)*9/30/20159/30/202626,738 26,681 18,208 
First lien (3)(11)(12) - Drawn7.25% (L + 6.25%/M)1/25/20219/30/20261,052 1,052 1,052 
Subordinated (3)(11)2.00% (L + 1.00% PIK/M)*3/16/20219/30/20265,230 — — 
33,020 27,733 19,260 1.52 %
Xactly Corporation
SoftwareFirst lien (4)(11)8.25% (L + 7.25%/S)7/31/20177/29/202219,047 18,981 19,047 1.51 %
Bluefin Holding, LLC
SoftwareSecond lien (8)(11)7.86% (L + 7.75%/M)9/6/20199/3/202718,000 18,000 18,180 1.44 %
Kele Holdco, Inc.
Distribution & LogisticsFirst lien (5)(11)7.00% (L + 6.00%/M)2/20/20202/20/202616,071 16,002 16,231 
First lien (3)(11)(12) - Drawn7.00% (L + 6.00%/M)2/20/20202/20/20261,507 1,499 1,507 
17,578 17,501 17,738 1.40 %
The accompanying notes are an integral part of these consolidated financial statements.
12

New Mountain Finance Corporation
 
Consolidated Schedule of Investments (Continued)
March 31, 2021
(in thousands, except shares)
(unaudited)

Portfolio Company, Location and Industry (1)Type of InvestmentInterest Rate (13)Acquisition DateMaturity / Expiration Date Principal
 Amount,
 Par Value
 or Shares
 Cost Fair
 Value
Percent of Net
Assets
Bullhorn, Inc.
SoftwareFirst lien (2)(11)6.75% (L + 5.75%/Q)9/24/20199/30/2026$16,959 $16,857 $16,959 
First lien (3)(11)6.75% (L + 5.75%/Q)9/24/20199/30/2026352 349 352 
First lien (3)(11)6.75% (L + 5.75%/Q)9/24/20199/30/2026280 279 280 
17,591 17,485 17,591 1.39 %
The Kleinfelder Group, Inc.
Business ServicesFirst lien (4)(11)6.25% (L + 5.25%/Q)12/18/201811/29/202417,106 17,050 17,106 1.35 %
Coyote Buyer, LLC
Specialty Chemicals & MaterialsFirst lien (5)(11)7.00% (L + 6.00%/Q)3/13/20202/6/202614,043 13,983 14,043 
First lien (5)(11)9.00% (L + 8.00%/Q)10/15/20208/6/20262,527 2,503 2,527 
16,570 16,486 16,570 1.31 %
Hill International, Inc.**
Business ServicesFirst lien (2)(11)6.75% (L + 5.75%/Q)6/21/20176/21/202315,208 15,175 15,208 1.20 %
Bleriot US Bidco Inc.
Federal ServicesSecond lien (2)8.70% (L + 8.50%/Q)10/24/201910/29/202715,000 14,869 15,113 1.20 %
CFS Management, LLC
Healthcare ServicesFirst lien (2)(11)6.50% (L + 5.50%/S)8/6/20197/1/202411,585 11,545 11,585 
First lien (3)(11)6.50% (L + 5.50%/S)8/6/20197/1/20243,451 3,436 3,451 
15,036 14,981 15,036 1.19 %
FR Arsenal Holdings II Corp.
Business ServicesFirst lien (2)(11)8.50% (L + 7.50%/S)9/29/20169/8/202215,229 15,180 14,860 1.18 %
BackOffice Associates Holdings, LLC
Business ServicesFirst lien (2)(11)13.50% (L + 9.50% + 3.00% PIK/Q)*8/25/20178/25/202312,623 12,574 12,623 
First lien (3)(11)(12) - Drawn13.50% (L + 9.50% + 3.00% PIK/Q)*8/25/20178/25/2023928 920 928 
13,551 13,494 13,551 1.07 %
Alegeus Technologies Holding Corp.
Healthcare ServicesFirst lien (8)(11)9.25% (L + 8.25%/Q)9/5/20189/5/202413,444 13,401 13,444 1.06 %
Transcendia Holdings, Inc.
PackagingSecond lien (8)(11)9.00% (L + 8.00%/M)6/28/20175/30/202514,500 14,377 13,086 1.04 %
PaySimple, Inc.
SoftwareFirst lien (2)(11)5.61% (L + 5.50%/M)8/19/20198/23/20259,734 9,659 9,734 
First lien (2)(11)5.61% (L + 5.50%/M)8/19/20198/23/20253,187 3,134 3,187 
12,921 12,793 12,921 1.02 %
The accompanying notes are an integral part of these consolidated financial statements.
13

New Mountain Finance Corporation
 
Consolidated Schedule of Investments (Continued)
March 31, 2021
(in thousands, except shares)
(unaudited)

Portfolio Company, Location and Industry (1)Type of InvestmentInterest Rate (13)Acquisition DateMaturity / Expiration Date Principal
 Amount,
 Par Value
 or Shares
 Cost Fair
 Value
Percent of Net
Assets
Ministry Brands, LLC
SoftwareFirst lien (2)(11)5.00% (L + 4.00%/M)12/7/201612/2/2022$2,895 $2,890 $2,887 
Second lien (8)(11)10.25% (L + 9.25%/M)12/7/20166/2/20237,840 7,816 7,840 
Second lien (3)(11)10.25% (L + 9.25%/M)12/7/20166/2/20232,160 2,153 2,160 
12,895 12,859 12,887 1.02 %
Geo Parent Corporation
Business ServicesFirst lien (2)5.36% (L + 5.25%/M)12/13/201812/19/202512,901 12,854 12,868 1.02 %
OEConnection LLC
Business ServicesSecond lien (2)(11)8.36% (L + 8.25%/M)9/25/20199/25/202712,044 11,941 12,164 0.96 %
Apptio, Inc.
SoftwareFirst lien (8)(11)8.25% (L + 7.25%/S)1/10/20191/10/202511,203 11,047 11,203 
First lien (3)(11)(12) - Drawn8.25% (L + 7.25%/S)1/10/20191/10/2025827 810 827 
12,030 11,857 12,030 0.95 %
Castle Management Borrower LLC
Business ServicesFirst lien (2)(11)7.50% (L + 6.50% PIK/Q)*5/31/20182/15/202414,261 14,224 11,959 0.95 %
CHA Holdings, Inc.
Business ServicesSecond lien (4)(11)9.75% (L + 8.75%/Q)4/3/20184/10/20267,012 6,962 7,012 
Second lien (3)(11)9.75% (L + 8.75%/Q)4/3/20184/10/20264,453 4,421 4,453 
11,465 11,383 11,465 0.91 %
Recorded Future, Inc.
SoftwareFirst lien (8)(11)7.00% (L + 6.00%/S)8/26/20197/3/20256,250 6,226 6,266 
First lien (8)(11)7.00% (L + 6.00%/Q)3/26/20217/3/20254,800 4,769 4,812 
11,050 10,995 11,078 0.88 %
Alert Holding Company, Inc. (16)
Appriss Holdings, Inc.
Business ServicesFirst lien (8)(11)5.70% (L + 5.50%/Q)5/24/20195/29/202610,915 10,842 11,024 0.87 %
Vectra Co.
Business ProductsSecond lien (8)(11)7.36% (L + 7.25%/M)2/23/20183/8/202610,788 10,760 10,788 0.85 %
Masergy Holdings, Inc.
Business ServicesSecond lien (2)8.50% (L + 7.50%/Q)12/14/201612/16/202410,500 10,467 10,474 0.83 %
PPVA Black Elk (Equity) LLC
Business ServicesSubordinated (3)(11)5/3/201314,500 14,500 10,354 0.82 %
VT Topco, Inc.
Business ServicesSecond lien (4)(11)7.11% (L + 7.00%/M)8/14/20187/31/202610,000 9,981 10,000 0.79 %
Quartz Holding Company
SoftwareSecond lien (3)(11)8.11% (L + 8.00%/M)4/2/20194/2/202710,000 9,838 10,000 0.79 %
The accompanying notes are an integral part of these consolidated financial statements.
14

New Mountain Finance Corporation
 
Consolidated Schedule of Investments (Continued)
March 31, 2021
(in thousands, except shares)
(unaudited)

Portfolio Company, Location and Industry (1)Type of InvestmentInterest Rate (13)Acquisition DateMaturity / Expiration Date Principal
 Amount,
 Par Value
 or Shares
 Cost Fair
 Value
Percent of Net
Assets
Stats Intermediate Holdings, LLC**
Business ServicesFirst lien (2)5.45% (L + 5.25%/Q)5/22/20197/10/2026$9,875 $9,777 $9,875 0.78 %
Affordable Care Holding Corp.
Healthcare ServicesFirst lien (2)5.75% (L + 4.75%/Q)3/18/201910/24/20229,768 9,678 9,622 0.76 %
AgKnowledge Holdings Company, Inc.
Business ServicesFirst lien (2)(11)5.75% (L + 4.75%/S)11/30/20187/21/20239,237 9,212 9,237 0.73 %
AG Parent Holdings, LLC
Healthcare ServicesFirst lien (2)5.11% (L + 5.00%/M)7/30/20197/31/20266,905 6,877 6,879 0.54 %
CP VI Bella Midco, LLC
Healthcare ServicesSecond lien (3)(11)6.86% (L + 6.75%/M)1/25/201812/29/20256,732 6,710 6,732 0.53 %
DealerSocket, Inc.
SoftwareFirst lien (2)(11)5.75% (L + 4.75%/M)4/16/20184/26/20236,526 6,504 6,526 0.52 %
Restaurant Technologies, Inc.
Business ServicesSecond lien (4)6.61% (L + 6.50%/M)9/24/201810/1/20266,722 6,709 6,487 0.51 %
ADG, LLC
Healthcare ServicesSecond lien (3)(11)11.00% (L + 10.00% PIK/Q)*10/3/20163/28/20246,067 6,029 4,792 0.38 %
Sphera Solutions, Inc.
SoftwareFirst lien (2)(11)8.75% (L + 7.75%/Q)9/10/20196/14/20232,458 2,445 2,477 0.20 %
Education Management Corporation (14)
Education Management II LLC
EducationFirst lien (2)13.00% (L + 7.50%/M)(27)1/5/20157/2/2020300 292 — 
First lien (3)13.00% (L + 7.50%/M)(27)1/5/20157/2/2020169 165 — 
First lien (2)9.75% (L + 6.50%/Q)(27)1/5/20157/2/2020206 201 — 
First lien (3)9.75% (L + 6.50%/Q)(27)1/5/20157/2/2020116 113 — 
First lien (2)11.75% (P + 8.50%/M)(27)1/5/20157/2/2020140 116 — 
First lien (3)11.75% (P + 8.50%/M)(27)1/5/20157/2/202079 65 — 
First lien (2)11.75% (P + 8.50%/M)(27)1/5/20157/2/2020— 
First lien (3)11.75% (P + 8.50%/M)(27)1/5/20157/2/2020— 
1,016 957 — — %
PPVA Fund, L.P.
Business ServicesCollateralized Financing (27)(28)11/7/2014— — —  %
Total Funded Debt Investments - United States$2,120,369 $2,100,019 $2,076,198 164.41 %
Total Funded Debt Investments$2,206,579 $2,185,691 $2,162,778 171.27 %
Equity - Hong Kong
Bach Special Limited (Bach Preference Limited)**
EducationPreferred shares (3)(11)(22)9/1/201787,654 $8,687 $9,028 0.71 %
Total Shares - Hong Kong$8,687 $9,028 0.71 %
The accompanying notes are an integral part of these consolidated financial statements.
15

New Mountain Finance Corporation
 
Consolidated Schedule of Investments (Continued)
March 31, 2021
(in thousands, except shares)
(unaudited)

Portfolio Company, Location and Industry (1)Type of InvestmentInterest Rate (13)Acquisition DateMaturity / Expiration Date Principal
 Amount,
 Par Value
 or Shares
 Cost Fair
 Value
Percent of Net
Assets
Equity - United States
Avatar Topco, Inc.(23)
EducationPreferred shares (3)(11)11/17/201735,750 $53,790 $55,960 4.44 %
Symplr Software Intermediate Holdings, Inc. (24)
Healthcare Information TechnologyPreferred shares (4)(11)11/30/20187,500 9,793 9,906 
Preferred shares (3)(11)11/30/20182,586 3,376 3,415 
13,169 13,321 1.05 %
Alert Holding Company, Inc. (16)
Alert Intermediate Holdings I, Inc.
Business ServicesPreferred shares (3)(11)5/31/20196,111 7,386 7,478 0.59 %
Tenawa Resource Holdings LLC (15)
QID NGL LLC
Specialty Chemicals & MaterialsPreferred shares (6)(11)10/30/20171,623,385 1,623 2,067 
Preferred shares (6)(11)11/24/202044,668 45 46 
Ordinary shares (6)(11)5/12/20145,290,997 5,291 755 
6,959 2,868 0.23 %
Ancora Acquisition LLC
EducationPreferred shares (9)(11)8/12/2013372 83 158 0.01 %
Education Management Corporation (14)
EducationPreferred shares (2)1/5/20153,331 200 — 
Preferred shares (3)1/5/20151,879 113 — 
Ordinary shares (2)1/5/20152,994,065 100 — 
Ordinary shares (3)1/5/20151,688,976 56 — 
469 — — %
AAC Lender Holdings, LLC (26)
EducationOrdinary shares (3)(11)3/16/2021758 — — — %
Total Shares - United States$81,856 $79,785 6.32 %
Total Shares$90,543 $88,813 7.03 %
Warrants - United States
ASP LCG Holdings, Inc.
EducationWarrants (3)(11)5/5/20145/5/2026622 $37 $762 0.06 %
Total Warrants - United States$37 $762 0.06 %
Total Funded Investments$2,276,271 $2,252,353 178.36 %
The accompanying notes are an integral part of these consolidated financial statements.
16

New Mountain Finance Corporation
 
Consolidated Schedule of Investments (Continued)
March 31, 2021
(in thousands, except shares)
(unaudited)

Portfolio Company, Location and Industry (1)Type of InvestmentInterest Rate (13)Acquisition DateMaturity / Expiration Date Principal
 Amount,
 Par Value
 or Shares
 Cost Fair
 Value
Percent of Net
Assets
Unfunded Debt Investments - United States
MRI Software LLC
SoftwareFirst lien (2)(11)(12) - Undrawn3/24/20213/24/2022$9,684 $— $50 
First lien (3)(11)(12) - Undrawn1/31/20202/10/2022821 — 
First lien (3)(11)(12) - Undrawn1/31/20202/10/20261,902 (10)— 
12,407 (10)54 0.00 %
AAC Lender Holdings, LLC (26)
American Achievement Corporation (aka AAC Holding Corp.)
EducationFirst lien (3)(11)(12) - Undrawn1/25/20219/30/20261,600 — — — %
CoolSys, Inc.
Industrial ServicesFirst lien (3)(12) - Undrawn11/20/201911/19/20211,400 — — — %
Associations, Inc.
Business ServicesFirst lien (2)(11)(12) - Undrawn7/30/20187/30/2021152 (1)— — %
Kele Holdco, Inc.
Distribution & LogisticsFirst lien (3)(11)(12) - Undrawn2/20/20202/20/2026293 (1)— — %
AgKnowledge Holdings Company, Inc.
Business ServicesFirst lien (3)(11)(12) - Undrawn11/30/20187/21/2023526 (3)— — %
Recorded Future, Inc.
SoftwareFirst lien (3)(11)(12) - Undrawn8/26/20197/3/2025750 (4)— — %
DealerSocket, Inc.
SoftwareFirst lien (3)(11)(12) - Undrawn4/16/20184/26/2023560 (4)— — %
Coyote Buyer, LLC
Specialty Chemicals & MaterialsFirst lien (3)(11)(12) - Undrawn3/13/20202/6/20251,013 (5)— — %
Definitive Healthcare Holdings, LLC
Healthcare Information TechnologyFirst lien (3)(11)(12) - Undrawn8/7/20197/16/20241,848 (9)— 
First lien (3)(11)(12) - Undrawn8/7/20197/16/20216,061 — — 
7,909 (9)— — %
Alert Holding Company, Inc. (16)
Appriss Holdings, Inc.
Business ServicesFirst lien (3)(11)(12) - Undrawn5/24/20195/30/2025930 (9)— — %
The accompanying notes are an integral part of these consolidated financial statements.
17

New Mountain Finance Corporation
 
Consolidated Schedule of Investments (Continued)
March 31, 2021
(in thousands, except shares)
(unaudited)

Portfolio Company, Location and Industry (1)Type of InvestmentInterest Rate (13)Acquisition DateMaturity / Expiration Date Principal
 Amount,
 Par Value
 or Shares
 Cost Fair
 Value
Percent of Net
Assets
Xactly Corporation
SoftwareFirst lien (3)(11)(12) - Undrawn7/31/20177/29/2022$992 $(10)$— — %
Trader Interactive, LLC
Business ServicesFirst lien (3)(11)(12) - Undrawn6/15/20176/15/20231,562 (12)— — %
Kaseya Inc.
SoftwareFirst lien (3)(11)(12) - Undrawn5/9/20195/2/20251,179 (12)— — %
Bullhorn, Inc.
SoftwareFirst lien (3)(11)(12) - Undrawn9/24/201910/1/2021780 (6)— 
First lien (3)(11)(12) - Undrawn9/24/20199/30/2026852 (6)— 
1,632 (12)— — %
Instructure, Inc.
SoftwareFirst lien (3)(11)(12) - Undrawn3/24/20203/24/20262,036 (13)— — %
Integro Parent Inc.
Business ServicesFirst lien (3)(11)(12) - Undrawn6/8/20184/30/20222,805 (14)— — %
Integral Ad Science, Inc.
SoftwareFirst lien (3)(11)(12) - Undrawn7/19/20187/19/20231,807 (18)— — %
Diligent Corporation
SoftwareFirst lien (3)(11)(12) - Undrawn3/30/20218/4/20253,624 (18)— — %
Finalsite Holdings, Inc.
SoftwareFirst lien (3)(11)(12) - Undrawn9/25/20189/25/20242,521 (19)— — %
GS Acquisitionco, Inc.
SoftwareFirst lien (3)(11)(12) - Undrawn8/7/20195/24/20243,047 (19)— — %
YLG Holdings, Inc.
Business ServicesFirst lien (3)(11)(12) - Undrawn11/1/201910/31/20253,968 (20)— — %
Bluefin Holding, LLC
SoftwareFirst lien (3)(11)(12) - Undrawn9/6/20199/6/20241,515 (23)— — %
ConnectWise, LLC
SoftwareFirst lien (3)(11)(12) - Undrawn11/26/20192/28/20253,982 (25)— — %
GC Waves Holdings, Inc.**
Business ServicesFirst lien (3)(11)(12) - Undrawn10/31/201910/31/20253,951 (30)— — %
The accompanying notes are an integral part of these consolidated financial statements.
18

New Mountain Finance Corporation
 
Consolidated Schedule of Investments (Continued)
March 31, 2021
(in thousands, except shares)
(unaudited)

Portfolio Company, Location and Industry (1)Type of InvestmentInterest Rate (13)Acquisition DateMaturity / Expiration Date Principal
 Amount,
 Par Value
 or Shares
 Cost Fair
 Value
Percent of Net
Assets
Salient CRGT Inc.
Federal ServicesFirst lien (3)(11)(12) - Undrawn6/26/201811/29/2021$6,125 $(490)$— — %
Apptio, Inc.
SoftwareFirst lien (3)(11)(12) - Undrawn1/10/20191/10/20251,240 (25)— — %
Ministry Brands, LLC
SoftwareFirst lien (3)(11)(12) - Undrawn12/7/201612/2/20221,000 (5)(3)(0.00) %
DCA Investment Holding, LLC
Healthcare ServicesFirst lien (3)(12) - Undrawn3/12/20213/10/20234,924 — (37)(0.00) %
Granicus, Inc.
SoftwareFirst lien (3)(11)(12) - Undrawn1/27/20211/30/20236,035 — (45)
First lien (3)(11)(12) - Undrawn1/27/20211/29/20272,414 (18)(18)
8,449 (18)(63)(0.00) %
NMC Crimson Holdings, Inc.
Healthcare ServicesFirst lien (3)(12) - Undrawn3/1/20213/1/202310,664 — (160)(0.02)%
Total Unfunded Debt Investments - United States$94,563 $(829)$(209)(0.02)%
Total Unfunded Debt Investments $94,563 $(829)$(209)(0.02)%
Total Non-Controlled/Non-Affiliated Investments$2,275,442 $2,252,144 178.34 %
Non-Controlled/Affiliated Investments (29)
Funded Debt Investments - United States
TVG-Edmentum Holdings, LLC (17)
Edmentum Ultimate Holdings, LLC
EducationSubordinated (3)(11)11.00% (L + 10.00%/Q)12/11/202012/11/2026$15,000 $14,856 $14,850 1.18 %
Sierra Hamilton Holdings Corporation
EnergySecond lien (3)(11)15.00%/Q9/12/20199/12/2023727 717 654 0.05 %
Permian Holdco 3, Inc.
Permian Trust
EnergyFirst lien (10)(11)10.00% PIK/Q*3/30/2021247 225 — 
First lien (3)(11)11.00% (L + 10.00% PIK/M)*7/23/20203,255 — — 
3,502 225 — — %
Total Funded Debt Investments - United States$19,229 $15,798 $15,504 1.23 %
The accompanying notes are an integral part of these consolidated financial statements.
19

New Mountain Finance Corporation
 
Consolidated Schedule of Investments (Continued)
March 31, 2021
(in thousands, except shares)
(unaudited)

Portfolio Company, Location and Industry (1)Type of InvestmentInterest Rate (13)Acquisition DateMaturity / Expiration Date Principal
 Amount,
 Par Value
 or Shares
 Cost Fair
 Value
Percent of Net
Assets
Equity - United States
TVG-Edmentum Holdings, LLC (17)
EducationPreferred shares (3)(11)12/11/202037,793 $38,952 $51,696 
Ordinary shares (3)(11)12/11/202036,750 37,426 50,270 
76,378 101,966 8.07 %
Sierra Hamilton Holdings Corporation
EnergyOrdinary shares (2)(11)7/31/201725,000,000 11,501 3,599 
Ordinary shares (3)(11)7/31/20172,786,000 1,282 401 
12,783 4,000 0.32 %
Total Shares - United States$89,161 $105,966 8.39 %
Total Non-Controlled/Affiliated Investments$104,959 $121,470 9.62 %
Controlled Investments (30)
Funded Debt Investments - United States
New Benevis Topco, LLC (25)
New Benevis Holdco, Inc.
Healthcare ServicesFirst lien (2)(11)10.50% (L + 2.50% + 7.00% PIK/Q)*10/6/20204/7/2025$31,422 $31,422 $31,422 
First lien (8)(11)10.50% (L + 2.50% + 7.00% PIK/Q)*10/6/20204/7/20257,710 7,710 7,710 
First lien (3)(11)10.50% (L + 2.50% + 7.00% PIK/Q)*10/6/20204/7/20253,786 3,786 3,786 
Subordinated (3)(11)12.00% PIK/M*10/6/202010/6/202515,113 12,447 12,091 
58,031 55,365 55,009 4.36 %
UniTek Global Services, Inc.
Business ServicesFirst lien (2)(11)8.50% (L + 5.50% + 2.00% PIK/S)*6/29/20188/20/202412,537 12,537 12,018 
First lien (3)(11)8.50% (L + 5.50% + 2.00% PIK/S)*3/16/20208/20/20249,292 8,363 8,908 
First lien (2)(11)8.50% (L + 5.50% + 2.00% PIK/S)*6/29/20188/20/20242,507 2,507 2,404 
First lien (3)(11)8.50% (L + 5.50% + 2.00% PIK/S)*6/29/20188/20/20241,338 1,157 1,283 
Second lien (3)(11)15.00% PIK/Q*12/16/20202/20/20258,910 8,910 8,910 
34,584 33,474 33,523 2.65 %
NHME Holdings Corp. (21)
National HME, Inc.
Healthcare ServicesSecond lien (3)(11)12.00% PIK/Q*11/27/20185/27/202419,202 16,464 13,921 
Second lien (3)(11)12.00% PIK/Q*11/27/20185/27/202410,611 9,949 9,285 
29,813 26,413 23,206 1.84 %
The accompanying notes are an integral part of these consolidated financial statements.
20

New Mountain Finance Corporation
 
Consolidated Schedule of Investments (Continued)
March 31, 2021
(in thousands, except shares)
(unaudited)

Portfolio Company, Location and Industry (1)Type of InvestmentInterest Rate (13)Acquisition DateMaturity / Expiration Date Principal
 Amount,
 Par Value
 or Shares
 Cost Fair
 Value
Percent of Net
Assets
New Permian Holdco, Inc.
New Permian Holdco, L.L.C.
EnergyFirst lien (3)(11)18.00% PIK/M*10/30/202012/31/2024$15,921 $15,921 $15,921 
First lien (3)(11)(12) - Drawn10.00% (L + 9.00% PIK/M)*10/30/202012/31/20244,372 4,372 4,372 
20,293 20,293 20,293 1.61 %
Total Funded Debt Investments - United States$142,721 $135,545 $132,031 10.46 %
Equity - Canada
NM APP Canada Corp.**
Net LeaseMembership interest (7)(11)9/13/2016— $7,345 $12,488 0.99 %
Total Shares - Canada$7,345 $12,488 0.99 %
Equity - United States
NMFC Senior Loan Program III LLC**
Investment FundMembership interest (3)(11)5/4/2018— $130,000 $130,000 10.29 %
NM NL Holdings, L.P.**
Net LeaseMembership interest (7)(11)6/20/2018— 88,151 101,500 8.04 %
NMFC Senior Loan Program II LLC**
Investment FundMembership interest (3)(11)5/3/2016— 79,400 79,400 6.29 %
New Benevis Topco, LLC (25)
Healthcare ServicesOrdinary shares (2)(11)10/6/2020269,027 27,154 30,366 
Ordinary shares (8)(11)10/6/202066,007 6,662 7,451 
Ordinary shares (3)(11)10/6/202060,068 6,105 6,780 
39,921 44,597 3.53 %
NM GLCR LP
Net LeaseMembership interest (7)(11)2/1/2018— 14,750 29,463 2.33 %
NMFC Senior Loan Program I LLC**
Investment FundMembership interest (3)(11)6/13/2014— 23,000 23,000 1.82 %
The accompanying notes are an integral part of these consolidated financial statements.
21

New Mountain Finance Corporation
 
Consolidated Schedule of Investments (Continued)
March 31, 2021
(in thousands, except shares)
(unaudited)

Portfolio Company, Location and Industry (1)Type of InvestmentInterest Rate (13)Acquisition DateMaturity / Expiration Date Principal
 Amount,
 Par Value
 or Shares
 Cost Fair
 Value
Percent of Net
Assets
UniTek Global Services, Inc.
Business ServicesPreferred shares (3)(11)(20)8/17/201810,968,736 $10,969 $8,149 
Preferred shares (3)(11)(20)8/29/20196,519,234 6,519 5,549 
Preferred shares (3)(11)(19)(27)6/30/201719,336,201 19,336 7,953 
Preferred shares (2)(11)(18)(27)1/13/201529,326,545 26,946 — 
Preferred shares (3)(11)(18)(27)1/13/20158,104,462 7,447 — 
Ordinary shares (2)(11)1/13/20152,096,477 1,925 — 
Ordinary shares (3)(11)1/13/20151,993,749 532 — 
73,674 21,651 1.71 %
NM CLFX LP
Net LeaseMembership interest (7)(11)10/6/2017— 12,538 14,896 1.18 %
New Permian Holdco, Inc.
EnergyOrdinary shares (3)(11)10/30/2020100 11,155 11,000 0.87 %
NM APP US LLC
Net LeaseMembership interest (7)(11)9/13/2016— 5,080 7,525 0.60 %
NM DRVT LLC
Net LeaseMembership interest (7)(11)11/18/2016— 5,152 7,194 0.57 %
NM YI, LLC
Net LeaseMembership interest (7)(11)9/30/2019 6,272 6,866 0.54 %
NHME Holdings Corp. (21)
Healthcare ServicesOrdinary shares (3)(11)11/27/2018640,000 4,000 4,000 0.32 %
NM JRA LLC
Net LeaseMembership interest (7)(11)8/12/2016 2,043 3,861 0.31 %
NM GP Holdco, LLC**
Net LeaseMembership interest (7)(11)6/20/2018— 1,010 1,135 0.09 %
NM KRLN LLC
Net LeaseMembership interest (7)(11)11/15/2016— 8,870 717 0.06 %
Total Shares - United States$505,016 $486,805 38.55 %
Total Shares$512,361 $499,293 39.54 %
Warrants - United States
UniTek Global Services, Inc.
Business ServicesWarrants (3)(11)12/16/20202/20/20258,523 $— $12,674 1.00 %
NHME Holdings Corp. (21)
Healthcare ServicesWarrants (3)(11)11/27/2018160,000 1,000 1,000 0.08 %
Total Warrants - United States$1,000 $13,674 1.08 %
Total Funded Investments$648,906 $644,998 51.08 %
The accompanying notes are an integral part of these consolidated financial statements.
22

New Mountain Finance Corporation
 
Consolidated Schedule of Investments (Continued)
March 31, 2021
(in thousands, except shares)
(unaudited)

Portfolio Company, Location and Industry (1)Type of InvestmentInterest Rate (13)Acquisition DateMaturity / Expiration Date Principal
 Amount,
 Par Value
 or Shares
 Cost Fair
 Value
Percent of Net
Assets
Unfunded Debt Investments - United States
New Permian Holdco, Inc.
New Permian Holdco, L.L.C.
EnergyFirst lien (3)(11)(12) - Undrawn10/30/202012/31/2024$5,740 $— $— — %
Total Unfunded Debt Investments - United States$5,740 $ $  %
Total Controlled Investments$648,906 $644,998 51.08 %
Total Investments$3,029,307 $3,018,612 239.04 %
(1)New Mountain Finance Corporation (the "Company") generally acquires its investments in private transactions exempt from registration under the Securities Act of 1933, as amended (the "Securities Act"). These investments are generally subject to certain limitations on resale, and may be deemed to be "restricted securities" under the Securities Act.
(2)Investment is pledged as collateral for the Holdings Credit Facility, a revolving credit facility among the Company, as the Collateral Manager, New Mountain Finance Holdings, L.L.C. ("NMF Holdings") as the Borrower and Wells Fargo Bank, National Association as the Administrative Agent and Collateral Custodian. See Note 7. Borrowings, for details.
(3)Investment is pledged as collateral for the NMFC Credit Facility, a revolving credit facility among the Company as the Borrower and Goldman Sachs Bank USA as the Administrative Agent and the Collateral Agent and Goldman Sachs Bank USA, Morgan Stanley Bank, N.A., Stifel Bank & Trust and MUFG Union Bank, N.A. as Lenders. See Note 7. Borrowings, for details.
(4)Investment is held in New Mountain Finance SBIC, L.P.
(5)Investment is held in New Mountain Finance SBIC II, L.P.
(6)Investment is held in NMF QID NGL Holdings, Inc.
(7)Investment is held in New Mountain Net Lease Corporation.
(8)Investment is pledged as collateral for the DB Credit Facility, a revolving credit facility among New Mountain Finance DB, L.L.C as the Borrower and Deutsche Bank AG, New York Branch as the Facility Agent. See Note 7. Borrowings, for details.
(9)Investment is held in NMF Ancora Holdings, Inc.
(10)Investment is held in NMF Permian Holdings, LLC.
(11)The fair value of the Company's investment is determined using unobservable inputs that are significant to the overall fair value measurement. See Note 4. Fair Value, for details.
(12)Par value amounts represent the drawn or undrawn (as indicated in type of investment) portion of revolving credit facilities or delayed draws. Cost amounts represent the cash received at settlement date net of the impact of paydowns and cash paid for drawn revolvers or delayed draws.
(13)All interest is payable in cash unless otherwise indicated. A majority of the variable rate debt investments bear interest at a rate that may be determined by reference to the London Interbank Offered Rate (L), the Prime Rate (P) and the alternative base rate (Base) and which resets daily (D), weekly (W), monthly (M), quarterly (Q), semi-annually (S) or annually (A). For each investment the current interest rate provided reflects the rate in effect as of March 31, 2021.
(14)The Company holds investments in Education Management Corporation and one related entity of Education Management Corporation. The Company holds series A-1 convertible preferred stock and common stock in Education Management Corporation and holds tranche A first lien term loans and a tranche B first lien term loan in Education Management II LLC, which is an indirect subsidiary of Education Management Corporation.
(15)The Company holds investments in two related entities of Tenawa Resource Holdings LLC. The Company holds 4.77% of the common units in QID NGL LLC (which at closing represented 98.1% of the ownership in the common units in Tenawa Resource Holdings LLC), class A and class B preferred units in QID NGL LLC and a first lien investment in Tenawa Resource Management LLC, a wholly-owned subsidiary of Tenawa Resource Holdings LLC.
(16)The Company holds investments in two wholly-owned subsidiaries of Alert Holding Company, Inc. The Company holds a first lien term loan and a first lien revolver in Appriss Holdings, Inc. and preferred equity in Alert Intermediate Holdings I, Inc. The preferred equity is entitled to receive preferential dividends at a rate of L + 10.0% per annum.
(17)The Company holds ordinary shares and preferred shares in TVG-Edmentum Holdings, LLC, and subordinated notes in Edmentum Ultimate Holdings, LLC, a wholly-owned subsidiary of TVG-Edmentum Holdings, LLC. The preferred shares are entitled to receive cumulative preferential dividends at a rate of 10.0% per annum. The ordinary shares are entitled to receive cumulative preferential dividends at a rate of 12.0% per annum.
(18)The Company holds preferred equity in UniTek Global Services, Inc. that is entitled to receive cumulative preferential dividends at a rate of 13.5% per annum payable in additional shares.
The accompanying notes are an integral part of these consolidated financial statements.
23

New Mountain Finance Corporation
 
Consolidated Schedule of Investments (Continued)
March 31, 2021
(in thousands, except shares)
(unaudited)

(19)The Company holds preferred equity in UniTek Global Services, Inc. that is entitled to receive cumulative preferential dividends at a rate of 19.0% per annum payable in additional shares.
(20)The Company holds preferred equity in UniTek Global Services, Inc. that is entitled to received cumulative preferential dividends at a rate of 20.0% per annum payable in additional shares.
(21)The Company holds ordinary shares and warrants in NHME Holdings Corp., as well as second lien term loans in National HME, Inc., a wholly-owned subsidiary of NHME Holdings Corp.
(22)The Company holds preferred equity in Bach Special Limited (Bach Preference Limited) that is entitled to receive cumulative preferential dividends at a rate of 12.25% per annum payable in additional shares.
(23)The Company holds preferred equity in Avatar Topco, Inc. and holds a second lien term loan investment in EAB Global, Inc., a wholly-owned subsidiary of Avatar Topco, Inc. The preferred equity is entitled to receive cumulative preferential dividends at a rate of L + 11.00% per annum.
(24)The Company holds preferred equity in Symplr Software Intermediate Holdings, Inc. that is entitled to receive cumulative preferential dividends at a rate of L + 10.50% per annum.
(25)The Company holds ordinary shares in New Benevis Topco, LLC, and holds first lien last out term loans and subordinated notes in New Benevis Holdco Inc., a wholly-owned subsidiary of New Benevis Topco, LLC.
(26)The Company holds ordinary shares in AAC Lender Holdings, LLC and a first lien term loan, first lien revolver and subordinated notes in American Achievement Corporation, a partially-owned subsidiary of AAC Lender Holdings, LLC.
(27)Investment or a portion of the investment is on non-accrual status. See Note 3. Investments, for details.
(28)The Company holds one security purchased under a collateralized agreement to resell on its Consolidated Statement of Assets and Liabilities with a cost basis of $30,000 and a fair value of $21,422 as of March 31, 2021. See Note 2. Summary of Significant Accounting Policies, for details.
(29)Denotes investments in which the Company is an “Affiliated Person”, as defined in the Investment Company Act of 1940, as amended (the "1940 Act"), due to owning or holding the power to vote 5.0% or more of the outstanding voting securities of the investment but not controlling the company. Fair value as of March 31, 2021 and December 31, 2020 along with transactions during the three months ended March 31, 2021 in which the issuer was a non-controlled/affiliated investment is as follows:
Portfolio CompanyFair Value at December 31, 2020Gross
Additions
(A)
Gross
Redemptions
(B)
Net
Realized
Gains
(Losses)
Net Change In
Unrealized
Appreciation
(Depreciation)
Fair Value at March 31, 2021Interest
Income
Dividend
Income
Other
Income
Permian Holdco 1, Inc. / Permian Holdco 2, Inc. / Permian Holdco 3, Inc. / Permian Trust$— $225 $(12,213)$(12,213)$11,988 $— $— $— $— 
Sierra Hamilton Holdings Corporation4,776 (106)(17)4,654 46 — 
TVG-Edmentum Holdings, LLC / Edmentum Ultimate Holdings, LLC98,236 1,509 — — 17,071 116,816 417 1,505 94 
Total Non-Controlled/Affiliated Investments$103,012 $1,735 $(12,319)$(12,212)$29,042 $121,470 $463 $1,505 $102 
(A)Gross additions include increases in the cost basis of investments resulting from new portfolio investments, payment-in-kind ("PIK") interest or dividends, the amortization of discounts, reorganizations or restructurings and the movement of an existing portfolio company into this category from a different category.
(B)Gross redemptions include decreases in the cost basis of investments resulting from principal collections related to investment repayments or sales, reorganizations or restructurings and the movement of an existing portfolio company out of this category into a different category.
The accompanying notes are an integral part of these consolidated financial statements.
24

New Mountain Finance Corporation
 
Consolidated Schedule of Investments (Continued)
March 31, 2021
(in thousands, except shares)
(unaudited)

(30)    Denotes investments in which the Company is in “Control”, as defined in the 1940 Act, due to owning or holding the power to vote more than 25.0% of the outstanding voting securities of the investment. Fair value as of March 31, 2021 and December 31, 2020, along with transactions during the three months ended March 31, 2021 in which the issuer was a controlled investment, is as follows:
Portfolio CompanyFair Value at December 31, 2020Gross
Additions
(A)
Gross
Redemptions
(B)
Net 
Realized
Gains
(Losses)
Net Change In
Unrealized
Appreciation
(Depreciation)
Fair Value at March 31, 2021Interest
Income
Dividend
Income
Other
Income
Edmentum Inc.$— $— $— $1,557 $— $— $— $— $1,200 
National HME, Inc./NHME Holdings Corp.27,530 1,070 — — (394)28,206 1,070 — 125 
New Benevis Topco, LLC / New Benevis Holdco, Inc.98,442 1,279 — — (115)99,606 1,649 — 375 
New Permian Holdco, Inc. / New Permian Holdco, L.L.C.29,336 1,957 — — — 31,293 791 — 230 
NM APP CANADA CORP12,302 — — — 186 12,488 — 252 — 
NM APP US LLC7,410 — — — 115 7,525 — 152 — 
NM CLFX LP14,885 — — — 11 14,896 — 397 — 
NM DRVT LLC7,084 — — — 110 7,194 — 124 — 
NM JRA LLC3,830 — — — 31 3,861 — 70 — 
NM GLCR LP29,130 — — — 333 29,463 — 483 — 
NM KRLN LLC1,501 289 — — (1,073)717 — — — 
NM NL Holdings, L.P.67,132 33,704 — — 664 101,500 — 1,608 — 
NM GP Holdco, LLC703 427 — — 1,135 — 17 — 
NM YI LLC6,852 — — — 14 6,866 — 285 — 
NMFC Senior Loan Program I LLC23,000 — — — — 23,000 — 575 — 
NMFC Senior Loan Program II LLC79,400 — — — — 79,400 — 1,985 — 
NMFC Senior Loan Program III LLC120,000 10,000 — — — 130,000 — 4,527 — 
UniTek Global Services, Inc.72,338 1,778 (2,540)(22)(3,728)67,848 942 1,281 181 
Total Controlled Investments$600,875 $50,504 $(2,540)$1,535 $(3,841)$644,998 $4,452 $11,756 $2,111 
(A)Gross additions include increases in the cost basis of investments resulting from new portfolio investments, PIK interest or dividends, the amortization of discounts, reorganizations or restructurings and the movement of an existing portfolio company into this category from a different category.
(B)Gross redemptions include decreases in the cost basis of investments resulting from principal collections related to investment repayments or sales, reorganizations or restructurings and the movement of an existing portfolio company out of this category into a different category.
*    All or a portion of interest contains PIK interest.
**    Indicates assets that the Company deems to be “non-qualifying assets” under Section 55(a) of the 1940 Act. Qualifying assets must represent at least 70.0% of the Company’s total assets at the time of acquisition of any additional non-qualifying assets. As of March 31, 2021, 16.9% of the Company’s total assets are represented by investments at fair value that are considered non-qualifying assets.
The accompanying notes are an integral part of these consolidated financial statements.
25

New Mountain Finance Corporation
 
Consolidated Schedule of Investments (Continued)
March 31, 2021
(unaudited)

 March 31, 2021
Investment TypePercent of Total
Investments at Fair Value
First lien52.23 %
Second lien23.06 %
Subordinated1.24 %
Equity and other23.47 %
Total investments100.00 %
 
 March 31, 2021
Industry TypePercent of Total
Investments at Fair Value
Software28.71 %
Business Services21.47 %
Healthcare Services16.49 %
Education8.60 %
Investment Funds (includes investments in joint ventures)7.70 %
Net Lease6.15 %
Federal Services2.16 %
Distribution & Logistics2.02 %
Specialty Chemicals & Materials1.91 %
Healthcare Information Technology1.60 %
Industrial Services1.21 %
Energy1.19 %
Packaging0.43 %
Business Products0.36 %
Total investments100.00 %
 
 March 31, 2021
Interest Rate TypePercent of Total
Investments at Fair Value
Floating rates93.25 %
Fixed rates6.75 %
Total investments100.00 %

The accompanying notes are an integral part of these consolidated financial statements.
26

New Mountain Finance Corporation
 
Consolidated Schedule of Investments
 December 31, 2020
(in thousands, except shares)
Portfolio Company, Location and Industry(1)Type of
Investment
Interest Rate (12)Acquisition DateMaturity/Expiration
Date
Principal
Amount,
Par Value
or Shares
CostFair ValuePercent of
Net
Assets
Non-Controlled/Non-Affiliated Investments
Funded Debt Investments - Canada
Dentalcorp Health Services ULC (fka Dentalcorp Perfect Smile ULC)**
Healthcare ServicesSecond lien (3)8.50% (L + 7.50%/M)6/1/20186/8/2026$28,612 $28,417 $28,612 
Second lien (8)8.50% (L + 7.50%/M)6/1/20186/8/20267,500 7,452 7,500 
36,112 35,869 36,112 2.92 %
Total Funded Debt Investments - Canada$36,112 $35,869 $36,112 2.92 %
Funded Debt Investments - United Arab Emirates
GEMS Menasa (Cayman) Limited**
EducationFirst lien (8)6.00% (L + 5.00%/S)7/30/20197/31/2026$15,678 $15,614 $15,658 1.27 %
Total Funded Debt Investments - United Arab Emirates$15,678 $15,614 $15,658 1.27 %
Funded Debt Investments - United Kingdom
Shine Acquisition Co. S.à.r.l / Boing US Holdco Inc.**
Consumer ServicesSecond lien (2)(10)8.50% (L + 7.50%/M)9/25/201710/3/2025$37,853 $37,697 $37,853 
Second lien (8)(10)8.50% (L + 7.50%/M)9/25/201710/3/20256,000 5,975 6,000 
43,853 43,672 43,853 3.54 %
Aston FinCo S.a r.l. / Aston US Finco, LLC**
SoftwareSecond lien (8)(10)8.40% (L + 8.25%/M)10/8/201910/8/202734,459 34,213 34,459 2.79 %
Total Funded Debt Investments - United Kingdom$78,312 $77,885 $78,312 6.33 %
Funded Debt Investments - United States
GS Acquisitionco, Inc.
SoftwareFirst lien (2)(10)6.75% (L + 5.75%/S)8/7/20195/24/2024$26,639 $26,517 $26,639 
First lien (2)(10)6.75% (L + 5.75%/S)8/7/20195/24/202425,950 25,818 25,950 
First lien (5)(10)6.75% (L + 5.75%/S)8/7/20195/24/202422,193 22,091 22,193 
First lien (2)(10)6.75% (L + 5.75%/S)8/7/20195/24/202412,649 12,578 12,649 
87,43187,00487,4317.07 %
PhyNet Dermatology LLC
Healthcare ServicesFirst lien (2)(10)6.50% (L + 5.50%/M)9/17/20188/16/202449,857 49,528 48,844 
First lien (3)(10)6.50% (L + 5.50%/M)9/17/20188/16/202427,857 27,623 27,291 
77,71477,15176,1356.15 %
Associations, Inc.
Business ServicesFirst lien (2)(10)8.00% (L + 4.00% + 3.00% PIK/Q)*7/30/20187/30/202445,932 45,751 45,932 
First lien (8)(10)8.00% (L + 4.00% + 3.00% PIK/Q)*7/30/20187/30/20245,272 5,252 5,272 
First lien (2)(10)(11) - Drawn8.00% (L + 4.00% + 3.00% PIK/Q)*7/30/20187/30/202410,41910,37110,419
First lien (2)(10)(11) - Drawn7.00% (L + 6.00%/Q)7/30/20187/30/20242,033 2,020 2,033 
63,656 63,394 63,656 5.14 %
The accompanying notes are an integral part of these consolidated financial statements.
27

New Mountain Finance Corporation
 
Consolidated Schedule of Investments (Continued)
 December 31, 2020
(in thousands, except shares)

Portfolio Company, Location and Industry(1)Type of
Investment
Interest Rate (12)Acquisition DateMaturity/Expiration
Date
Principal
Amount,
Par Value
or Shares
CostFair ValuePercent of
Net
Assets
ConnectWise, LLC
SoftwareFirst lien (2)(10)6.25% (L + 5.25%/Q)11/26/20192/28/2025$55,054 $54,772 $55,054 
First lien (3)(10)(11) - Drawn6.25% (L + 5.25%/M)11/26/20192/28/20251,062 1,055 1,062 
56,116 55,827 56,116 4.54 %
iCIMS, Inc.
SoftwareFirst lien (8)(10)7.50% (L + 6.50%/S)9/12/20189/12/202441,636 41,340 41,794 
First lien (8)(10)7.50% (L + 6.50%/S)6/14/20199/12/20248,667 8,602 8,700 
First lien (3)(10)(11) - Drawn7.50% (L + 6.50%/Q)9/12/20189/12/20242,915 2,886 2,915 
53,218 52,828 53,409 4.32 %
CentralSquare Technologies, LLC
SoftwareSecond lien (3)7.75% (L + 7.50%/Q)8/15/20188/31/202647,838 47,361 46,164 
Second lien (8)7.75% (L + 7.50%/Q)8/15/20188/31/20267,500 7,425 7,237 
55,338 54,786 53,401 4.32 %
DCA Investment Holding, LLC
Healthcare ServicesFirst lien (8)(10)6.25% (L + 5.25%/Q)4/16/20197/2/202120,316 20,243 19,977 
First lien (2)(10)6.25% (L + 5.25%/Q)7/2/20157/2/202116,916 16,900 16,634 
First lien (8)(10)6.25% (L + 5.25%/Q)12/20/20177/2/20218,801 8,782 8,654 
First lien (2)(10)6.25% (L + 5.25%/Q)12/20/20177/2/20214,142 4,135 4,073 
First lien (3)(10)(11) - Drawn6.25% (L + 5.25%/Q)7/2/20157/2/20212,056 2,036 2,022 
52,231 52,096 51,360 4.15 %
Salient CRGT Inc.
Federal ServicesFirst lien (2)(10)7.50% (L + 6.50%/S)1/6/20152/28/202237,348 37,209 37,348 
First lien (8)(10)7.50% (L + 6.50%/S)6/6/20192/28/202212,762 12,528 12,762 
50,110 49,737 50,110 4.05 %
Frontline Technologies Group Holdings, LLC
SoftwareFirst lien (4)(10)6.75% (L + 5.75%/Q)9/18/20179/18/202321,940 21,856 21,940 
First lien (2)(10)6.75% (L + 5.75%/Q)9/18/20179/18/202318,490 18,447 18,490 
First lien (2)(10)6.75% (L + 5.75%/Q)9/18/20179/18/20237,632 7,594 7,632 
48,062 47,897 48,062 3.88 %
NM GRC Holdco, LLC
Business ServicesFirst lien (2)(10)8.50% (L + 6.00% + 1.50% PIK/Q)*2/9/20182/9/202438,368 38,258 36,929 
First lien (2)(10)8.50% (L + 6.00% + 1.50% PIK/Q)*2/9/20182/9/202410,664 10,631 10,264 
49,032 48,889 47,193 3.82 %
Brave Parent Holdings, Inc.
SoftwareSecond lien (5)(10)7.65% (L + 7.50%/M)4/17/20184/17/202622,500 22,417 22,500 
Second lien (2)(10)7.65% (L + 7.50%/M)4/17/20184/17/202616,624 16,498 16,624 
Second lien (8)(10)7.65% (L + 7.50%/M)4/17/20184/17/20266,000 5,955 6,000 
45,124 44,870 45,124 3.65 %
The accompanying notes are an integral part of these consolidated financial statements.
28

New Mountain Finance Corporation
 
Consolidated Schedule of Investments (Continued)
 December 31, 2020
(in thousands, except shares)

Portfolio Company, Location and Industry(1)Type of
Investment
Interest Rate (12)Acquisition DateMaturity/Expiration
Date
Principal
Amount,
Par Value
or Shares
CostFair ValuePercent of
Net
Assets
Integro Parent Inc.
Business ServicesFirst lien (2)(10)6.75% (L + 5.75%/M)10/9/201510/31/2022$34,490 $34,405 $34,490 
Second lien (8)(10)10.25% (L + 9.25%/M)10/9/201510/30/202310,000 9,955 10,000 
44,490 44,360 44,490 3.60 %
Quest Software US Holdings Inc.
SoftwareSecond lien (2)(10)8.46% (L + 8.25%/Q)5/17/20185/18/202643,697 43,367 43,697 3.53 %
Tenawa Resource Holdings LLC (14)
Tenawa Resource Management LLC
Specialty Chemicals & MaterialsFirst lien (3)(10)10.50% (Base + 8.00%/Q)5/12/201410/30/202438,600 38,559 38,600 3.12 %
Trader Interactive, LLC
Business ServicesFirst lien (2)(10)7.25% (L + 6.25%/M)6/15/20176/17/202431,605 31,482 31,605 
First lien (8)(10)7.25% (L + 6.25%/M)6/15/20176/17/20244,899 4,880 4,899 
First lien (3)(10)(11) - Drawn7.25% (L + 6.25%/M)6/15/20176/15/2023502 498 502 
37,006 36,860 37,006 2.99 %
CoolSys, Inc.
Industrial ServicesFirst lien (5)7.00% (L + 6.00%/Q)11/20/201911/20/202622,275 22,177 22,275 
First lien (2)7.00% (L + 6.00%/Q)11/20/201911/20/202610,296 10,251 10,296 
First lien (3)7.00% (L + 6.00%/Q)11/20/201911/20/20264,173 4,153 4,173 
36,744 36,581 36,744 2.97 %
KAMC Holdings, Inc
Business ServicesSecond lien (2)(10)8.22% (L + 8.00%/Q)8/14/20198/13/202718,750 18,627 18,300 
Second lien (8)(10)8.22% (L + 8.00%/Q)8/14/20198/13/202718,750 18,627 18,300 
37,500 37,254 36,600 2.96 %
Affinity Dental Management, Inc.
Healthcare ServicesFirst lien (2)(10)7.00% (L + 6.00%/Q)9/15/20179/15/202326,222 26,182 24,397 
First lien (4)(10)7.00% (L + 6.00%/Q)9/17/20199/15/202310,592 10,592 9,854 
First lien (3)(10)(11) - Drawn7.00% (L + 6.00%/Q)9/15/20173/15/20231,738 1,720 1,617 
38,552 38,494 35,868 2.90 %
GC Waves Holdings, Inc.**
Business ServicesFirst lien (5)(10)6.75% (L + 5.75%/Q)10/31/201910/31/202522,331 22,191 22,331 
First lien (2)(10)6.75% (L + 5.75%/Q)10/31/201910/31/20253,645 3,622 3,645 
First lien (3)(10)6.75% (L + 5.75%/Q)10/31/201910/31/20259,835 9,742 9,835 
35,811 35,555 35,811 2.89 %
Definitive Healthcare Holdings, LLC
Healthcare Information TechnologyFirst lien (8)(10)6.50% (L + 5.50%/Q)8/7/20197/16/202633,615 33,477 33,615 
First lien (3)(10)(11) - Drawn6.50% (L + 5.50%/Q)8/7/20197/16/20261,327 1,321 1,327 
34,942 34,798 34,942 2.82 %
The accompanying notes are an integral part of these consolidated financial statements.
29

New Mountain Finance Corporation
 
Consolidated Schedule of Investments (Continued)
 December 31, 2020
(in thousands, except shares)

Portfolio Company, Location and Industry(1)Type of
Investment
Interest Rate (12)Acquisition DateMaturity/Expiration
Date
Principal
Amount,
Par Value
or Shares
CostFair ValuePercent of
Net
Assets
TDG Group Holding Company
Consumer ServicesFirst lien (2)(10)5.40% (L + 5.25%/M)5/22/20185/31/2024$24,607 $24,532 $24,607 
First lien (8)(10)5.40% (L + 5.25%/M)5/22/20185/31/20244,900 4,884 4,900 
First lien (2)(10)5.40% (L + 5.25%/M)5/22/20185/31/20243,287 3,277 3,287 
First lien (2)(10)(11) - Drawn5.40% (L + 5.25%/M)5/22/20185/31/20241,891 1,882 1,891 
34,685 34,575 34,685 2.80 %
Kaseya Inc.
SoftwareFirst lien (8)(10)8.00% (L + 4.00% + 3.00% PIK/S)*5/9/20195/2/202528,225 28,014 28,508 
First lien (3)(10)8.00% (L + 4.00% + 3.00% PIK/S)*5/9/20195/2/20253,315 3,284 3,348 
First lien (3)(10)(11) - Drawn7.50% (L + 6.50%/S)5/9/20195/2/20251,133 1,121 1,133 
32,673 32,419 32,989 2.67 %
Finalsite Holdings, Inc.
SoftwareFirst lien (4)(10)6.00% (L + 5.00%/Q)9/28/20189/25/202421,994 21,883 21,994 
First lien (2)(10)6.00% (L + 5.00%/Q)9/28/20189/25/202410,863 10,809 10,863 
32,857 32,692 32,857 2.66 %
Integral Ad Science, Inc.
SoftwareFirst lien (8)(10)8.25% (L + 6.00% + 1.25% PIK/S)*7/19/20187/19/202427,127 26,943 27,127 
First lien (3)(10)8.25% (L + 6.00% + 1.25% PIK/S)*8/27/20197/19/20243,544 3,517 3,544 
30,671 30,460 30,671 2.48 %
Ansira Holdings, Inc.
Business ServicesFirst lien (8)(10)7.50% (L + 6.50% PIK/S)*12/19/201612/20/202429,511 29,451 24,146 
First lien (3)(10)7.50% (L + 6.50% PIK/S)*12/19/201612/20/20247,452 7,440 6,097 
36,963 36,891 30,243 2.44 %
MRI Software LLC
SoftwareFirst lien (5)(10)6.50% (L + 5.50%/Q)1/31/20202/10/202622,329 22,232 22,358 
First lien (3)(10)6.50% (L + 5.50%/Q)1/31/20202/10/20264,654 4,632 4,660 
First lien (2)(10)6.50% (L + 5.50%/Q)1/31/20202/10/20261,615 1,608 1,617 
28,598 28,472 28,635 2.31 %
Keystone Acquisition Corp.
Healthcare ServicesFirst lien (2)6.25% (L + 5.25%/Q)5/10/20175/1/202424,231 24,143 22,899 
Second lien (2)(10)10.25% (L + 9.25%/Q)5/10/20175/1/20254,500 4,471 4,500 
28,731 28,614 27,399 2.22 %
Confluent Health, LLC
Healthcare ServicesFirst lien (2)5.15% (L + 5.00%/M)6/21/20196/24/202627,088 26,976 26,783 2.17 %
HS Purchaser, LLC / Help/Systems Holdings, Inc.
SoftwareSecond lien (5)9.00% (L + 8.00%/Q)11/14/201911/19/202722,500 22,391 22,275 
Second lien (2)9.00% (L + 8.00%/Q)11/14/201911/19/20274,208 4,170 4,166 
26,708 26,561 26,441 2.14 %
Instructure, Inc.
SoftwareFirst lien (8)(10)8.00% (L + 7.00%/Q)3/24/20203/24/202624,090 23,955 23,940 1.93 %
Idera, Inc.
SoftwareSecond lien (4)(10)10.00% (L + 9.00%/S)6/27/20196/28/202722,500 22,353 22,725 1.84 %
The accompanying notes are an integral part of these consolidated financial statements.
30

New Mountain Finance Corporation
 
Consolidated Schedule of Investments (Continued)
 December 31, 2020
(in thousands, except shares)

Portfolio Company, Location and Industry(1)Type of
Investment
Interest Rate (12)Acquisition DateMaturity/Expiration
Date
Principal
Amount,
Par Value
or Shares
CostFair ValuePercent of
Net
Assets
Astra Acquisition Corp.
SoftwareFirst lien (5)6.50% (L + 5.50%/M)2/26/20203/1/2027$22,331 $22,179 $22,555 1.82 %
Syndigo LLC
SoftwareSecond lien (4)8.75% (L + 8.00%/S)12/14/202012/15/202822,500 22,331 22,331 1.80 %
Convey Health Solutions, Inc.
Healthcare ServicesFirst lien (4)(10)6.25% (L + 5.25%/Q)9/9/20199/4/202622,219 22,008 22,219 1.80 %
Cardinal Parent, Inc.
SoftwareFirst lien (4)5.25% (L + 4.50%/S)10/30/202011/12/202712,188 12,097 12,066 
Second lien (4)(10)8.50% (L + 7.75%/S)11/12/202011/13/20289,767 9,670 9,962 
21,955 21,767 22,028 1.78 %
CRCI Longhorn Holdings, Inc.
Business ServicesSecond lien (3)(10)7.40% (L + 7.25%/M)8/2/20188/10/202614,349 14,307 14,349 
Second lien (8)(10)7.40% (L + 7.25%/M)8/2/20188/10/20267,500 7,478 7,500 
21,849 21,785 21,849 1.77 %
Avatar Topco, Inc. (23)
EAB Global, Inc.
EducationSecond lien (3)(10)8.50% (L + 7.50%/S)11/17/201711/17/202513,950 13,805 13,950 
Second lien (8)(10)8.50% (L + 7.50%/S)11/17/201711/17/20257,500 7,422 7,500 
21,450 21,227 21,450 1.73 %
MED Parentco, LP
Healthcare ServicesSecond lien (8)(10)8.40% (L + 8.25%/M)8/2/20198/30/202720,857 20,718 21,066 1.70 %
YLG Holdings, Inc.
Business ServicesFirst lien (5)(10)7.25% (L + 6.25%/S)11/1/201910/31/202518,229 18,152 18,271 
First lien (5)(10)7.25% (L + 6.25%/S)11/1/201910/31/20252,374 2,363 2,379 
20,603 20,515 20,650 1.67 %
TMK Hawk Parent, Corp.
Distribution & LogisticsFirst lien (2)(10)3.65% (L + 3.50%/M)6/24/20198/28/202416,735 14,786 10,468 
First lien (8)(10)3.65% (L + 3.50%/M)10/23/20198/28/202416,141 13,778 10,096 
32,876 28,564 20,564 1.66 %
Institutional Shareholder Services, Inc.
Business ServicesSecond lien (3)(10)8.75% (L + 8.50%/Q)3/5/20193/5/202720,372 20,117 20,372 1.65 %
Spring Education Group, Inc (fka SSH Group Holdings, Inc.)
EducationSecond lien (2)8.50% (L + 8.25%/Q)7/26/20187/30/202621,959 21,914 20,202 1.63 %
AAC Holding Corp.
EducationFirst lien (2)(10)9.25% (L + 8.25% PIK/M)*9/30/20159/30/202226,343 26,284 19,597 1.58 %
DiversiTech Holdings, Inc.
Distribution & LogisticsSecond lien (2)8.50% (L + 7.50%/Q)5/18/20176/2/202512,000 11,923 11,940 
Second lien (8)8.50% (L + 7.50%/Q)5/18/20176/2/20257,500 7,452 7,463 
19,500 19,375 19,403 1.57 %
Xactly Corporation
SoftwareFirst lien (4)(10)8.25% (L + 7.25%/S)7/31/20177/29/202219,047 18,970 19,047 1.54 %
The accompanying notes are an integral part of these consolidated financial statements.
31

New Mountain Finance Corporation
 
Consolidated Schedule of Investments (Continued)
 December 31, 2020
(in thousands, except shares)

Portfolio Company, Location and Industry(1)Type of
Investment
Interest Rate (12)Acquisition DateMaturity/Expiration
Date
Principal
Amount,
Par Value
or Shares
CostFair ValuePercent of
Net
Assets
Peraton Holding Corp. (fka MHVC Acquisition Corp.)
Federal ServicesFirst lien (2)6.25% (L + 5.25%/Q)4/25/20174/29/2024$18,575 $18,525 $18,621 1.50 %
Bluefin Holding, LLC
SoftwareSecond lien (8)(10)7.90% (L + 7.75%/M)9/6/20199/6/202718,000 18,000 18,000 1.46 %
Kele Holdco, Inc.
Distribution & LogisticsFirst lien (5)(10)7.00% (L + 6.00%/M)2/20/20202/20/202616,111 16,040 16,292 
First lien (3)(10)(11) - Drawn7.00% (L + 6.00%/M)2/20/20202/20/20261,619 1,611 1,619 
17,730 17,651 17,911 1.45 %
Bullhorn, Inc.
SoftwareFirst lien (2)(10)6.75% (L + 5.75%/Q)9/24/20199/30/202617,002 16,896 17,002 
First lien (3)(10)6.75% (L + 5.75%/Q)9/24/20199/30/2026353 350 353 
First lien (3)(10)6.75% (L + 5.75%/Q)9/24/20199/30/2026281 279 281 
17,636 17,525 17,636 1.43 %
The Kleinfelder Group, Inc.
Business ServicesFirst lien (4)(10)6.25% (L + 5.25%/Q)12/18/201811/29/202417,150 17,090 17,150 1.39 %
Coyote Buyer, LLC
Specialty Chemicals & MaterialsFirst lien (5)(10)7.00% (L + 6.00%/Q)3/13/20202/6/202614,079 14,016 14,079 
First lien (5)(10)9.00% (L + 8.00%/Q)10/15/20208/6/20262,533 2,508 2,558 
16,612 16,524 16,637 1.35 %
Hill International, Inc.**
Business ServicesFirst lien (2)(10)6.75% (L + 5.75%/Q)6/21/20176/21/202315,247 15,212 15,247 1.23 %
CFS Management, LLC
Healthcare ServicesFirst lien (2)(10)6.50% (L + 5.50%/S)8/6/20197/1/202411,615 11,571 11,615 
First lien (3)(10)6.50% (L + 5.50%/S)8/6/20197/1/20243,459 3,443 3,459 
15,074 15,014 15,074 1.22 %
Bleriot US Bidco Inc.
Federal ServicesSecond lien (2)(10)8.75% (L + 8.50%/Q)10/24/201910/29/202715,000 14,865 15,011 1.21 %
FR Arsenal Holdings II Corp.
Business ServicesFirst lien (2)(10)8.50% (L + 7.50%/Q)9/29/20169/8/202215,344 15,286 14,932 1.21 %
BackOffice Associates Holdings, LLC
Business ServicesFirst lien (2)(10)13.50% (L + 9.50% + 3.00% PIK/Q)*8/25/20178/25/202313,218 13,162 13,218 
First lien (3)(10)(11) - Drawn13.50% (L + 9.50% + 3.00% PIK/Q)*8/25/20178/25/2023921 913 921 
14,139 14,075 14,139 1.14 %
Alegeus Technologies Holding Corp.
Healthcare ServicesFirst lien (8)(10)9.25% (L + 8.25%/Q)9/5/20189/5/202413,444 13,398 13,444 1.09 %
Transcendia Holdings, Inc.
PackagingSecond lien (8)(10)9.00% (L + 8.00%/M)6/28/20175/30/202514,500 14,371 13,069 1.06 %
PaySimple, Inc.
SoftwareFirst lien (2)(10)5.65% (L + 5.50%/M)8/19/20198/23/20259,758 9,679 9,758 
First lien (2)(10)5.65% (L + 5.50%/M)8/19/20198/23/20253,195 3,140 3,195 
12,953 12,819 12,953 1.05 %
Geo Parent Corporation
Business ServicesFirst lien (2)(10)5.40% (L + 5.25%/M)12/13/201812/19/202512,934 12,885 12,934 1.04 %
The accompanying notes are an integral part of these consolidated financial statements.
32

New Mountain Finance Corporation
 
Consolidated Schedule of Investments (Continued)
 December 31, 2020
(in thousands, except shares)

Portfolio Company, Location and Industry(1)Type of
Investment
Interest Rate (12)Acquisition DateMaturity/Expiration
Date
Principal
Amount,
Par Value
or Shares
CostFair ValuePercent of
Net
Assets
Ministry Brands, LLC
SoftwareFirst lien (2)(10)5.00% (L + 4.00%/Q)12/7/201612/2/2022$2,902 $2,897 $2,888 
Second lien (8)(10)10.25% (L + 9.25%/Q)12/7/20166/2/20237,840 7,813 7,840 
Second lien (3)(10)10.25% (L + 9.25%/Q)12/7/20166/2/20232,160 2,153 2,160 
12,90212,86312,8881.04 %
OEConnection LLC
Business ServicesSecond lien (2)(10)8.40% (L + 8.25%/M)9/25/20199/25/202712,044 11,937 12,044 0.97 %
CHA Holdings, Inc.
Business ServicesSecond lien (4)(10)9.75% (L + 8.75%/Q)4/3/20184/10/20267,012 6,959 7,012 
Second lien (3)(10)9.75% (L + 8.75%/Q)4/3/20184/10/20264,452 4,419 4,452 
11,464 11,378 11,464 0.93 %
Castle Management Borrower LLC
Business ServicesFirst lien (2)(10)7.50% (L + 6.50% PIK/Q)*5/31/20182/15/202413,993 13,953 11,320 0.92 %
Apptio, Inc.
SoftwareFirst lien (8)(10)8.25% (L + 7.25%/S)1/10/20191/10/202511,203 11,038 11,287 0.91 %
Alert Holding Company, Inc. (15)
Appriss Holdings, Inc.
Business ServicesFirst lien (8)(10)5.50% (L + 5.25%/Q)5/24/20195/29/202610,943 10,866 10,947 0.89 %
Vectra Co.
Business ProductsSecond lien (8)(10)7.40% (L + 7.25%/M)2/23/20183/8/202610,788 10,759 10,788 0.87 %
Masergy Holdings, Inc.
Business ServicesSecond lien (2)(10)8.50% (L + 7.50%/Q)12/14/201612/16/202410,500 10,465 10,500 0.85 %
PPVA Black Elk (Equity) LLC
Business ServicesSubordinated (3)(10)5/3/201314,500 14,500 10,354 0.84 %
VT Topco, Inc.
Business ServicesSecond lien (4)(10)7.15% (L + 7.00%/M)8/14/20187/31/202610,000 9,981 10,000 0.81 %
Quartz Holding Company
SoftwareSecond lien (3)(10)8.15% (L + 8.00%/M)4/2/20194/2/202710,000 9,832 10,000 0.81 %
Stats Intermediate Holdings, LLC**
Business ServicesFirst lien (2)5.47% (L + 5.25%/Q)5/22/20197/10/20269,900 9,798 9,875 0.80 %
Affordable Care Holding Corp.
Healthcare ServicesFirst lien (2)(10)5.75% (L + 4.75%/Q)3/18/201910/24/20229,794 9,690 9,671 0.78 %
AgKnowledge Holdings Company, Inc.
Business ServicesFirst lien (2)(10)5.75% (L + 4.75%/S)11/30/20187/21/20239,261 9,233 9,261 0.75 %
AG Parent Holdings, LLC
Healthcare ServicesFirst lien (2)5.15% (L + 5.00%/M)7/30/20197/31/20266,923 6,894 6,853 0.55 %
Recorded Future, Inc.
SoftwareFirst lien (8)(10)7.25% (L + 6.25%/Q)8/26/20197/3/20256,250 6,225 6,275 
First lien (3)(10)(11) - Drawn7.25% (L + 6.25%/Q)8/26/20197/3/2025500 498 500 
6,750 6,723 6,775 0.55 %
The accompanying notes are an integral part of these consolidated financial statements.
33

New Mountain Finance Corporation
 
Consolidated Schedule of Investments (Continued)
 December 31, 2020
(in thousands, except shares)

Portfolio Company, Location and Industry(1)Type of
Investment
Interest Rate (12)Acquisition DateMaturity/Expiration
Date
Principal
Amount,
Par Value
or Shares
CostFair ValuePercent of
Net
Assets
CP VI Bella Midco, LLC
Healthcare ServicesSecond lien (3)6.90% (L + 6.75%/M)1/25/201812/29/2025$6,732 $6,709 $6,660 0.54 %
DealerSocket, Inc.
SoftwareFirst lien (2)(10)5.75% (L + 4.75%/S)4/16/20184/26/20236,543 6,518 6,543 0.53 %
DG Investment Intermediate Holdings 2, Inc. (aka Convergint Technologies Holdings, LLC)
Business ServicesSecond lien (3)7.50% (L + 6.75%/M)1/29/20182/2/20266,732 6,709 6,530 0.53 %
Restaurant Technologies, Inc.
Business ServicesSecond lien (4)6.65% (L + 6.50%/M)9/24/201810/1/20266,722 6,709 6,420 0.52 %
Diligent Corporation
SoftwareFirst lien (3)(10)7.25% (L + 6.25%/S)12/19/20188/4/20255,947 5,912 6,057 0.49 %
Wrike, Inc.
SoftwareFirst lien (8)(10)7.75% (L + 6.75%/S)11/20/202012/31/20244,545 4,514 4,580 0.37 %
ADG, LLC
Healthcare ServicesSecond lien (3)(10)11.00% (L + 10.00% PIK/Q)*10/3/20163/28/20245,904 5,864 4,469 0.36 %
Teneo Holdings, LLC
Business ServicesFirst lien (2)6.25% (L + 5.25%/M)7/15/20197/11/20253,012 2,980 2,994 0.24 %
Sphera Solutions, Inc.
SoftwareFirst lien (2)(10)8.75% (L + 7.75%/Q)9/10/20196/14/20232,464 2,450 2,487 0.20 %
Education Management Corporation (13)
Education Management II LLC
EducationFirst lien (2)13.00% (L + 7.50%/M)(26)1/5/20157/2/2020300 292 — 
First lien (3)13.00% (L + 7.50%/M)(26)1/5/20157/2/2020169 165 — 
First lien (2)9.75% (L + 6.50%/Q)(26)1/5/20157/2/2020206 201 — 
First lien (3)9.75% (L + 6.50%/Q)(26)1/5/20157/2/2020116 113 — 
First lien (2)11.75% (P + 8.50%/M)(26)1/5/20157/2/2020140 116 — 
First lien (3)11.75% (P + 8.50%/M)(26)1/5/20157/2/202079 65 — 
First lien (2)11.75% (P + 8.50%/M)(26)1/5/20157/2/2020— 
First lien (3)11.75% (P + 8.50%/M)(26)1/5/20157/2/2020— 
1,016 957 — — %
PPVA Fund, L.P.
Business ServicesCollateralized Financing (26)(27)11/7/2014— — — — %
Total Funded Debt Investments - United States$2,079,719 $2,064,501 $2,029,981 164.11 %
Total Funded Debt Investments$2,209,821 $2,193,869 $2,160,063 174.63 %
Equity - Hong Kong
Bach Special Limited (Bach Preference Limited)**
EducationPreferred shares (3)(10)(22)9/1/201784,994 $8,420 $8,754 0.71 %
Total Shares - Hong Kong$8,420 $8,754 0.71 %
The accompanying notes are an integral part of these consolidated financial statements.
34

New Mountain Finance Corporation
 
Consolidated Schedule of Investments (Continued)
 December 31, 2020
(in thousands, except shares)

Portfolio Company, Location and Industry(1)Type of
Investment
Interest Rate (12)Acquisition DateMaturity/Expiration
Date
Principal
Amount,
Par Value
or Shares
CostFair ValuePercent of
Net
Assets
Equity - United States
Avatar Topco, Inc. (23)
EducationPreferred shares (3)(10)11/17/201735,750 $52,192 $53,265 4.31 %
Symplr Software Intermediate Holdings, Inc.(24)
Healthcare Information TechnologyPreferred shares (4)(10)11/30/20187,500 9,534 9,647 
Preferred shares (3)(10)11/30/20182,586 3,287 3,326 
12,821 12,973 1.05 %
Alert Holding Company, Inc. (15)
Alert Intermediate Holdings I, Inc.
Business ServicesPreferred shares (3)(10)5/31/20196,111 7,199 7,290 0.59 %
Tenawa Resource Holdings LLC (14)
QID NGL LLC
Specialty Chemicals & MaterialsPreferred shares (6)(10)10/30/20171,623,385 1,623 1,988 
Preferred shares (6)(10)11/24/202044,668 45 45 
Ordinary shares (6)(10)5/12/20145,290,997 5,291 4,381 
6,959 6,414 0.52 %
Ancora Acquisition LLC
EducationPreferred shares (9)(10)8/12/2013372 83 158 0.01 %
Education Management Corporation (13)
EducationPreferred shares (2)1/5/20153,331 200 — 
Preferred shares (3)1/5/20151,879 113 — 
Ordinary shares (2)1/5/20152,994,065 100 — 
Ordinary shares (3)1/5/20151,688,976 56 — 
469 — — %
Total Shares - United States$79,723 $80,100 6.48 %
Total Shares$88,143 $88,854 7.19 %
Warrants - United States
ASP LCG Holdings, Inc.
EducationWarrants (3)(10)5/5/20145/5/2026622 $37 $714 0.06 %
Total Warrants - United States$37 $714 0.06 %
Total Funded Investments$2,282,049 $2,249,631 181.88 %
Unfunded Debt Investments - United States
Recorded Future, Inc.
SoftwareFirst lien (3)(10)(11) - Undrawn8/26/20191/3/2021$500 $(3)$
First lien (3)(10)(11) - Undrawn8/26/20197/3/2025250 (1)— 
750 (4)— %
The accompanying notes are an integral part of these consolidated financial statements.
35

New Mountain Finance Corporation
 
Consolidated Schedule of Investments (Continued)
 December 31, 2020
(in thousands, except shares)

Portfolio Company, Location and Industry(1)Type of
Investment
Interest Rate (12)Acquisition DateMaturity/Expiration
Date
Principal
Amount,
Par Value
or Shares
CostFair ValuePercent of
Net
Assets
MRI Software LLC
SoftwareFirst lien (3)(10)(11) - Undrawn1/31/20202/10/2022$821 $— $
First lien (3)(10)(11) - Undrawn1/31/20202/10/20262,002 (10)— 
2,823 (10)— %
CoolSys, Inc.
Industrial ServicesFirst lien (3)(11) - Undrawn11/20/201911/19/20211,400 — — — %
Kele Holdco, Inc.
Distribution & LogisticsFirst lien (3)(10)(11) - Undrawn2/20/20202/20/2026180 (1)— — %
Associations, Inc.
Business ServicesFirst lien (2)(10)(11) - Undrawn7/30/20187/30/2021152 (1)— — %
AgKnowledge Holdings Company, Inc.
Business ServicesFirst lien (3)(10)(11) - Undrawn11/30/20187/21/2023526 (3)— — %
DealerSocket, Inc.
SoftwareFirst lien (3)(10)(11) - Undrawn4/16/20184/26/2023560 (4)— — %
Coyote Buyer, LLC
Specialty Chemicals & MaterialsFirst lien (3)(10)(11) - Undrawn3/13/20202/6/20251,013 (5)— — %
Trader Interactive, LLC
Business ServicesFirst lien (3)(10)(11) - Undrawn6/15/20176/15/20231,171 (9)— — %
Definitive Healthcare Holdings, LLC
Healthcare Information TechnologyFirst lien (3)(10)(11) - Undrawn8/7/20197/16/20241,848 (9)— 
First lien (3)(10)(11) - Undrawn8/7/20197/16/20216,061 — — 
7,909 (9)— — %
Alert Holding Company, Inc. (15)
Appriss Holdings, Inc.
Business ServicesFirst lien (3)(10)(11) - Undrawn5/24/20195/30/2025930 (9)— — %
Xactly Corporation
SoftwareFirst lien (3)(10)(11) - Undrawn7/31/20177/29/2022992 (10)— — %
Kaseya Inc.
SoftwareFirst lien (3)(10)(11) - Undrawn5/9/20195/2/20251,179 (12)— — %
The accompanying notes are an integral part of these consolidated financial statements.
36

New Mountain Finance Corporation
 
Consolidated Schedule of Investments (Continued)
 December 31, 2020
(in thousands, except shares)

Portfolio Company, Location and Industry(1)Type of
Investment
Interest Rate (12)Acquisition DateMaturity/Expiration
Date
Principal
Amount,
Par Value
or Shares
CostFair ValuePercent of
Net
Assets
Bullhorn, Inc.
SoftwareFirst lien (3)(10)(11) - Undrawn9/24/201910/1/2021$781 $(6)$— 
First lien (3)(10)(11) - Undrawn9/24/20199/30/2026852 (6)— 
1,633 (12)— — %
Wrike, Inc.
SoftwareFirst lien (3)(10)(11) - Undrawn12/31/201812/31/20241,388 (13)— — %
TDG Group Holding Company
Consumer ServicesFirst lien (2)(10)(11) - Undrawn5/22/20185/31/20243,152 (16)— — %
Integral Ad Science, Inc.
SoftwareFirst lien (3)(10)(11) - Undrawn7/19/20187/19/20231,807 (18)— — %
Finalsite Holdings, Inc.
SoftwareFirst lien (3)(10)(11) - Undrawn9/25/20189/25/20242,521 (19)— — %
YLG Holdings, Inc.
Business ServicesFirst lien (3)(10)(11) - Undrawn11/1/201910/31/20253,968 (20)— — %
ConnectWise, LLC
SoftwareFirst lien (3)(10)(11) - Undrawn11/26/20192/28/20253,186 (20)— — %
Bluefin Holding, LLC
SoftwareFirst lien (3)(10)(11) - Undrawn9/6/20199/6/20241,515 (23)— — %
GC Waves Holdings, Inc.**
Business ServicesFirst lien (3)(10)(11) - Undrawn10/31/201910/31/20253,951 (30)— — %
Integro Parent Inc.
Business ServicesFirst lien (3)(10)(11) - Undrawn6/8/20184/30/20226,743 (34)— — %
GS Acquisitionco, Inc.
SoftwareFirst lien (3)(10)(11) - Undrawn8/7/20195/24/20245,485 (34)— — %
Apptio, Inc.
SoftwareFirst lien (3)(10)(11) - Undrawn1/10/20191/10/20252,066 (41)— — %
Salient CRGT Inc.
Federal ServicesFirst lien (3)(10)(11) - Undrawn6/26/201811/29/20216,125 (490)— — %
DCA Investment Holding, LLC
Healthcare ServicesFirst lien (3)(10)(11) - Undrawn7/2/20157/2/202144 — (1)(0.00)%
The accompanying notes are an integral part of these consolidated financial statements.
37

New Mountain Finance Corporation
 
Consolidated Schedule of Investments (Continued)
 December 31, 2020
(in thousands, except shares)

Portfolio Company, Location and Industry(1)Type of
Investment
Interest Rate (12)Acquisition DateMaturity/Expiration
Date
Principal
Amount,
Par Value
or Shares
CostFair ValuePercent of
Net
Assets
Ministry Brands, LLC
SoftwareFirst lien (3)(10)(11) - Undrawn12/7/201612/2/2022$1,000 $(5)$(5)(0.00)%
Instructure, Inc.
SoftwareFirst lien (3)(10)(11) - Undrawn3/24/20203/24/20262,036 (13)(13)(0.00)%
Total Unfunded Debt Investments - United States$66,205 $(865)$(16)(0.00)%
Total Unfunded Debt Investments$66,205 $(865)$(16)(0.00)%
Total Non-Controlled/Non-Affiliated Investments$2,281,184 $2,249,615 181.88 %
Non-Controlled/Affiliated Investments(28)
Funded Debt Investments - United States
TVG-Edmentum Holdings, LLC (16)
Edmentum Ultimate Holdings, LLC
EducationSubordinated (3)(10)11.00% (L + 10.00%/M)12/11/202012/11/2026$15,000 $14,851 $14,850 1.20 %
Sierra Hamilton Holdings Corporation
EnergySecond lien (3)(10)15.00%/Q9/12/20199/12/2023835 821 751 0.06 %
Permian Holdco 1, Inc.
Permian Holdco 2, Inc.
Permian Holdco 3, Inc.
EnergyFirst lien (3)(10)11.00% (L + 10.00% PIK/M)(26)*7/23/20202/15/20212,562 — — 
Subordinated (3)(10)18.00% PIK/Q (26)*12/26/20186/30/20222,417 2,417 — 
Subordinated (3)(10)14.00% PIK/Q (26)*10/31/201610/15/20211,708 1,708 — 
Subordinated (3)(10)14.00% PIK/Q (26)*10/31/201610/15/20211,025 1,025 — 
7,712 5,150 — — %
Total Funded Debt Investments - United States$23,547 $20,822 $15,601 1.26 %
Equity - United States
TVG-Edmentum Holdings, LLC (16)
EducationPreferred shares (3)(10)12/11/202037,793 $38,002 $42,276 
Ordinary shares (3)(10)12/11/202036,750 36,872 41,110 
74,874 83,386 6.74 %
Sierra Hamilton Holdings Corporation
EnergyOrdinary shares (2)(10)7/31/201725,000,000 11,501 3,622 
Ordinary shares (3)(10)7/31/20172,786,000 1,282 403 
12,783 4,025 0.33 %
The accompanying notes are an integral part of these consolidated financial statements.
38

New Mountain Finance Corporation
 
Consolidated Schedule of Investments (Continued)
 December 31, 2020
(in thousands, except shares)

Portfolio Company, Location and Industry(1)Type of
Investment
Interest Rate (12)Acquisition DateMaturity/Expiration
Date
Principal
Amount,
Par Value
or Shares
CostFair ValuePercent of
Net
Assets
Permian Holdco 1, Inc.
EnergyPreferred shares (3)(10)(17)(26)10/31/20161,366,452 $5,714 $— 
Ordinary shares (3)(10)10/31/20161,366,452 1,350 — 
7,064 — — %
Total Shares - United States$94,721 $87,411 7.07 %
Total Non-Controlled/Affiliated Investments$115,543 $103,012 8.33 %
Controlled Investments(29)
Funded Debt Investments - United States
New Benevis Topco, LLC (25)
New Benevis Holdco, Inc.
Healthcare ServicesFirst lien (2)(10)10.50% (L + 2.50% + 7.00% PIK/Q)*10/6/20204/7/2025$30,882 $30,882 $30,882 
First lien (8)(10)10.50% (L + 2.50% + 7.00% PIK/Q)*10/6/20204/7/20257,577 7,577 7,577 
First lien (3)(10)10.50% (L + 2.50% + 7.00% PIK/Q)*10/6/20204/7/20253,720 3,720 3,720 
Subordinated (3)(10)12.00% PIK/M*10/6/202010/6/202514,669 11,906 11,735 
56,848 54,085 53,914 4.37 %
UniTek Global Services, Inc.
Business ServicesFirst lien (2)(10)8.50% (L + 5.50% + 2.00% PIK/S)*6/29/20188/20/202412,512 12,512 11,969 
First lien (3)(10)8.50% (L + 5.50% + 2.00% PIK/S)*3/16/20208/20/20249,274 8,315 8,872 
First lien (2)(10)8.50% (L + 5.50% + 2.00% PIK/S)*6/29/20188/20/20242,502 2,502 2,394 
First lien (3)(10)8.50% (L + 5.50% + 2.00% PIK/S)*6/29/20188/20/20241,334 1,143 1,276 
Second lien (3)(10)15.00% PIK/Q*12/16/20202/20/202511,045 11,045 11,045 
36,667 35,517 35,556 2.87 %
NHME Holdings Corp. (21)
National HME, Inc.
Healthcare ServicesSecond lien (3)(10)12.00% PIK/Q*11/27/20185/27/202418,643 15,745 13,516 
Second lien (3)(10)12.00% PIK/Q*11/27/20185/27/202410,302 9,599 9,014 
28,945 25,344 22,530 1.82 %
New Permian Holdco, Inc.
New Permian Holdco, L.L.C.
EnergyFirst lien (3)(10)18.00% PIK/M*10/30/202012/31/202415,236 15,236 15,236 
First lien (3)(10)(11) - Drawn10.00% (L + 9.00% PIK/M)*10/30/202012/31/20243,100 3,100 3,100 
18,336 18,336 18,336 1.48 %
Total Funded Debt Investments - United States$140,796 $133,282 $130,336 10.54 %
The accompanying notes are an integral part of these consolidated financial statements.
39

New Mountain Finance Corporation
 
Consolidated Schedule of Investments (Continued)
 December 31, 2020
(in thousands, except shares)

Portfolio Company, Location and Industry(1)Type of
Investment
Interest Rate (12)Acquisition DateMaturity/Expiration
Date
Principal
Amount,
Par Value
or Shares
CostFair ValuePercent of
Net
Assets
Equity - Canada
NM APP Canada Corp.**
Net LeaseMembership interest (7)(10)9/13/2016— $7,345 $12,302 0.99 %
Total Shares - Canada$7,345 $12,302 0.99 %
Equity - United States
NMFC Senior Loan Program III LLC**
Investment FundMembership interest (3)(10)5/4/2018— $120,000 $120,000 9.70 %
NMFC Senior Loan Program II LLC**
Investment FundMembership interest (3)(10)5/3/2016— 79,400 79,400 6.42 %
NM NL Holdings, L.P.**
Net LeaseMembership interest (7)(10)6/20/2018— 54,447 67,132 5.43 %
New Benevis Topco, LLC (25)
Healthcare ServicesOrdinary shares (2)(10)10/6/2020269,02727,154 30,319 
Ordinary shares (8)(10)10/6/202066,0076,6627,439
Ordinary shares (3)(10)10/6/202060,068 6,105 6,770 
39,92144,5283.60 %
NM GLCR LP
Net LeaseMembership interest (7)(10)2/1/2018— 14,750 29,130 2.36 %
NMFC Senior Loan Program I LLC**
Investment FundMembership interest (3)(10)6/13/2014— 23,000 23,000 1.86 %
UniTek Global Services, Inc.
Business ServicesPreferred shares (3)(10)(20)8/17/201810,446,415 10,446 7,794 
Preferred shares (3)(10)(20)8/29/20196,208,794 6,209 5,466 
Preferred shares (3)(10)(19)(26)6/30/201718,887,620 18,888 7,634 
Preferred shares (2)(10)(18)(26)1/13/201529,326,545 26,946 — 
Preferred shares (3)(10)(18)(26)1/13/20158,104,462 7,447 — 
Ordinary shares (2)(10)1/13/20152,096,477 1,925 — 
Ordinary shares (3)(10)1/13/20151,993,749 532 — 
72,393 20,894 1.69 %
NM CLFX LP
Net LeaseMembership interest (7)(10)10/6/2017— 12,538 14,885 1.20 %
New Permian Holdco, Inc.
EnergyOrdinary shares (3)(10)10/30/2020— 11,15511,0000.89 %
NM APP US LLC
Net LeaseMembership interest (7)(10)9/13/2016— 5,080 7,410 0.60 %
NM DRVT LLC
Net LeaseMembership interest (7)(10)11/18/2016— 5,152 7,084 0.57 %
The accompanying notes are an integral part of these consolidated financial statements.
40

New Mountain Finance Corporation
 
Consolidated Schedule of Investments (Continued)
 December 31, 2020
(in thousands, except shares)

Portfolio Company, Location and Industry(1)Type of
Investment
Interest Rate (12)Acquisition DateMaturity/Expiration
Date
Principal
Amount,
Par Value
or Shares
CostFair ValuePercent of
Net
Assets
NM YI, LLC
Net LeaseMembership interest (7)(10)9/30/2019— $6,272 $6,852 0.55 %
NHME Holdings Corp. (21)
Healthcare ServicesOrdinary shares (3)(10)11/27/2018640,000 4,000 4,000 0.32 %
NM JRA LLC
Net LeaseMembership interest (7)(10)8/12/2016— 2,043 3,830 0.31 %
NM KRLN LLC
Net LeaseMembership interest (7)(10)11/15/2016— 8,581 1,501 0.12 %
NM GP Holdco, LLC**
Net LeaseMembership interest (7)(10)6/20/2018— 583 703 0.06 %
Total Shares - United States$459,315 $441,349 35.68 %
Total Shares$466,660 $453,651 36.67 %
Warrants - United States
UniTek Global Services, Inc.
Business ServicesWarrants(3)(10)12/16/20202/20/202510,976 $— $15,888 1.29 %
NHME Holdings Corp. (21)
Healthcare ServicesWarrants (3)(10)11/27/2018160,000 1,000 1,000 0.08 %
Total Warrants - United States$1,000 $16,888 1.37 %
Total Funded Investments$600,942 $600,875 48.58 %
Unfunded Debt Investments - United States
New Permian Holdco, Inc.
New Permian Holdco, L.L.C.
EnergyFirst lien (3)(10)(11) - Undrawn10/30/202012/31/2024$6,921 $— $— — %
Total Unfunded Debt Investments - United States$6,921 $ $  %
Total Controlled Investments$600,942 $600,875 48.58 %
Total Investments$2,997,669 $2,953,502 238.79 %
(1)New Mountain Finance Corporation (the "Company") generally acquires its investments in private transactions exempt from registration under the Securities Act of 1933, as amended (the "Securities Act"). These investments are generally subject to certain limitations on resale, and may be deemed to be "restricted securities" under the Securities Act.
(2)Investment is pledged as collateral for the Holdings Credit Facility, a revolving credit facility among the Company, as the Collateral Manager, New Mountain Finance Holdings, L.L.C. ("NMF Holdings") as the Borrower and Wells Fargo Bank, National Association as the Administrative Agent and Collateral Custodian. See Note 7. Borrowings, for details.
(3)Investment is pledged as collateral for the NMFC Credit Facility, a revolving credit facility among the Company as the Borrower and Goldman Sachs Bank USA as the Administrative Agent and the Collateral Agent and Goldman Sachs Bank USA, Morgan Stanley Bank, N.A., Stifel Bank & Trust and MUFG Union Bank, N.A. as Lenders. See Note 7. Borrowings, for details.
(4)Investment is held in New Mountain Finance SBIC, L.P.
(5)Investment is held in New Mountain Finance SBIC II, L.P.
(6)Investment is held in NMF QID NGL Holdings, Inc.
(7)Investment is held in New Mountain Net Lease Corporation.
(8)Investment is pledged as collateral for the DB Credit Facility, a revolving credit facility among New Mountain Finance DB, L.L.C as the Borrower and Deutsche Bank AG, New York Branch as the Facility Agent. See Note 7. Borrowings, for details.
The accompanying notes are an integral part of these consolidated financial statements.
41

New Mountain Finance Corporation
 
Consolidated Schedule of Investments (Continued)
 December 31, 2020
(in thousands, except shares)

(9)Investment is held in NMF Ancora Holdings, Inc.
(10)The fair value of the Company's investment is determined using unobservable inputs that are significant to the overall fair value measurement. See Note 4. Fair Value, for details.
(11)Par value amounts represent the drawn or undrawn (as indicated in type of investment) portion of revolving credit facilities or delayed draws. Cost amounts represent the cash received at settlement date net of the impact of paydowns and cash paid for drawn revolvers or delayed draws.
(12)All interest is payable in cash unless otherwise indicated. A majority of the variable rate debt investments bear interest at a rate that may be determined by reference to the London Interbank Offered Rate (L), the Prime Rate (P) and the alternative base rate (Base) and which resets daily (D), weekly (W), monthly (M), quarterly (Q), semi-annually (S) or annually (A). For each investment the current interest rate provided reflects the rate in effect as of December 31, 2020.
(13)The Company holds investments in Education Management Corporation and one related entity of Education Management Corporation. The Company holds series A-1 convertible preferred stock and common stock in Education Management Corporation and holds tranche A first lien term loans and a tranche B first lien term loan in Education Management II LLC, which is an indirect subsidiary of Education Management Corporation.
(14)The Company holds investments in two related entities of Tenawa Resource Holdings LLC. The Company holds 4.77% of the common units in QID NGL LLC (which at closing represented 98.1% of the ownership in the common units in Tenawa Resource Holdings LLC), class A and class B preferred units in QID NGL LLC and a first lien investment in Tenawa Resource Management LLC, a wholly-owned subsidiary of Tenawa Resource Holdings LLC.
(15)The Company holds investments in two wholly-owned subsidiaries of Alert Holding Company, Inc. The Company holds a first lien term loan and a first lien revolver in Appriss Holdings, Inc. and preferred equity in Alert Intermediate Holdings I, Inc. The preferred equity is entitled to receive preferential dividends at a rate of L + 10.0% per annum.
(16)The Company holds ordinary shares and preferred shares in TVG-Edmentum Holdings, LLC, and subordinated notes in Edmentum Ultimate Holdings, LLC, a wholly-owned subsidiary of TVG-Edmentum Holdings, LLC. The preferred shares are entitled to receive cumulative preferential dividends at a rate of 10.0% per annum. The ordinary shares are entitled to receive cumulative preferential dividends at a rate of 12.0% per annum.
(17)The Company holds preferred equity in Permian Holdco 1, Inc. that is entitled to receive cumulative preferential dividends at a rate of 12.0% per annum payable in additional shares.
(18)The Company holds preferred equity in UniTek Global Services, Inc. that is entitled to receive cumulative preferential dividends at a rate of 13.5% per annum payable in additional shares.
(19)The Company holds preferred equity in UniTek Global Services, Inc. that is entitled to receive cumulative preferential dividends at a rate of 19.0% per annum payable in additional shares.
(20)The Company holds preferred equity in UniTek Global Services, Inc. that is entitled to received cumulative preferential dividends at a rate of 20.0% per annum payable in additional shares.
(21)The Company holds ordinary shares and warrants in NHME Holdings Corp., as well as second lien term loans in National HME, Inc., a wholly-owned subsidiary of NHME Holdings Corp.
(22)The Company holds preferred equity in Bach Special Limited (Bach Preference Limited) that is entitled to receive cumulative preferential dividends at a rate of 12.25% per annum payable in additional shares.
(23)The Company holds preferred equity in Avatar Topco, Inc. and holds a second lien term loan investment in EAB Global, Inc., a wholly-owned subsidiary of Avatar Topco, Inc. The preferred equity is entitled to receive cumulative preferential dividends at a rate of L + 11.00% per annum.
(24)The Company holds preferred equity in Symplr Software Intermediate Holdings, Inc. that is entitled to receive cumulative preferential dividends at a rate of L + 10.50% per annum.
(25)The Company holds ordinary shares in New Benevis Topco, LLC, and holds first lien last out term loans and subordinated notes in New Benevis Holdco Inc., a wholly-owned subsidiary of New Benevis Topco, LLC.
(26)Investment or a portion of the investment is on non-accrual status. See Note 3. Investments, for details.
(27)The Company holds one security purchased under a collateralized agreement to resell on its Consolidated Statement of Assets and Liabilities with a cost basis of $30,000 and a fair value of $21,422 as of December 31, 2020. See Note 2. Summary of Significant Accounting Policies, for details.







The accompanying notes are an integral part of these consolidated financial statements.
42

New Mountain Finance Corporation
 
Consolidated Schedule of Investments (Continued)
 December 31, 2020
(in thousands, except shares)

(28)Denotes investments in which the Company is an “Affiliated Person”, as defined in the Investment Company Act of 1940, as amended (the "1940 Act"), due to owning or holding the power to vote 5.0% or more of the outstanding voting securities of the investment but not controlling the company. Fair value as of December 31, 2020 and December 31, 2019 along with transactions during the year ended December 31, 2020 in which the issuer was a non-controlled/affiliated investment is as follows:
Portfolio CompanyFair Value at December 31, 2019Gross
Additions (A)
Gross
Redemptions
(B)
Net
Realized
Gains
(Losses)
Net Change In
Unrealized
Appreciation
(Depreciation)
Fair Value at December 31, 2020Interest
Income
Dividend
Income
Other
Income
NMFC Senior Loan Program I LLC (C)$23,000 $— $(23,000)$— $— $— $— $2,611 $898 
Permian Holdco 1, Inc. / Permian Holdco 2, Inc. / Permian Holdco 3, Inc.40,621 (99)(33,321)(3,510)(7,201)— 532 (3,418)178 
Sierra Hamilton Holdings Corporation9,906 178 (766)13 (4,542)4,776 329 — 35 
TVG-Edmentum Holdings, LLC/Edmentum Ultimate Holdings, LLC— 89,726 — — 8,510 98,236 98 333 171 
Total Non-Controlled/Affiliated Investments$73,527 $89,805 $(57,087)$(3,497)$(3,233)$103,012 $959 $(474)$1,282 
(A)Gross additions include increases in the cost basis of investments resulting from new portfolio investments, payment-in-kind (“PIK”) interest or dividends, the amortization of discounts, reorganizations or restructurings and the movement at fair value of an existing portfolio company into this category from a different category.
(B)Gross reductions include decreases in the cost basis of investments resulting from principal collections related to investment repayments or sales, reorganizations or restructurings and the movement of an existing portfolio company out of this category into a different category.
(C)Portfolio company moved into the controlled category.
(29)    Denotes investments in which the Company is in “Control”, as defined in the 1940 Act, due to owning or holding the power to vote more than 25.0% of the outstanding voting securities of the investment. Fair value as of December 31, 2020 and December 31, 2019 along with transactions during the year ended December 31, 2020 in which the issuer was a controlled investment, is as follows:
Portfolio CompanyFair Value at December 31, 2019Gross
Additions
(A)
Gross
Redemptions
(B)
Net 
Realized
Gains
(Losses)
Net Change In
Unrealized
Appreciation
(Depreciation)
Fair Value at December 31, 2020Interest
Income
Dividend
Income
Other
Income
Edmentum Ultimate Holdings, LLC/Edmentum Inc.$79,112 $23,592 $(83,556)$13,924 $(19,148)$— $7,522 $— $4,555 
National HME, Inc./NHME Holdings Corp.24,979 4,011 — — (1,460)27,530 4,011 — 1,000 
New Benevis Topco, LLC / New Benevis Holdco, Inc.— 94,007 — — 4,435 98,442 1,559 — 803 
New LT Smile Holdings, LLC / Benevis Holdings Corp (C)— 69,886 (91,831)(9,739)21,945 — 1,434 — 415 
New Permian Holdco, Inc. / New Permian Holdco, L.L.C.— 29,491 — — (155)29,336 513 — 
NM APP CANADA CORP10,774 — — — 1,528 12,302 — 973 — 
NM APP US LLC6,834 — — — 576 7,410 — 636 — 
NM CLFX LP12,723 — — — 2,162 14,885 — 1,579 — 
NM DRVT LLC6,016 — — — 1,068 7,084 — 479 — 
NM JRA LLC3,700 — — — 130 3,830 — 272 — 
NM GLCR LP23,800 — — — 5,330 29,130 — 1,854 — 
NM KRLN LLC2,379 1,071 — — (1,949)1,501 — — — 
NM NL Holdings, L.P.48,308 10,376 — — 8,448 67,132 — 5,103 — 
NM GP Holdco, LLC487 131 — — 85 703 — 53 — 
NM YI LLC6,339 — — — 513 6,852 — 684 — 
NMFC Senior Loan Program I LLC (D)— 23,000 — — — 23,000 — 142 — 
NMFC Senior Loan Program II LLC79,400 — — — — 79,400 — 8,708 — 
NMFC Senior Loan Program III LLC100,000 20,000 — — — 120,000 — 11,864 — 
UniTek Global Services, Inc.68,101 29,744 (233)(25,274)72,338 1,792 7,297 559 
Total Controlled Investments$472,952 $305,309 $(175,620)$4,188 $(1,766)$600,875 $16,831 $39,644 $7,339 
(A)Gross additions include increases in the cost basis of investments resulting from new portfolio investments, PIK interest or dividends, the amortization of discounts, reorganizations or restructurings and the movement of an existing portfolio company into this category from a different category.
The accompanying notes are an integral part of these consolidated financial statements.
43

New Mountain Finance Corporation
 
Consolidated Schedule of Investments (Continued)
 December 31, 2020
(in thousands, except shares)

(B)Gross redemptions include decreases in the cost basis of investments resulting from principal collections related to investment repayments or sales, reorganizations or restructurings and the movement of an existing portfolio company out of this category into a different category.
(C)Portfolio company moved into the controlled category from the non-controlled/non-affiliated investment category.
(D)Portfolio company moved into the controlled category from the non-controlled/affiliated investment company.
*    All or a portion of interest contains PIK interest.
**    Indicates assets that the Company deems to be “non-qualifying assets” under Section 55(a) of the 1940 Act. Qualifying assets must represent at least 70.0% of the Company’s total assets at the time of acquisition of any additional non-qualifying assets. As of December 31, 2020, 16.2% of the Company’s total investments were non-qualifying assets.
The accompanying notes are an integral part of these consolidated financial statements.
44

New Mountain Finance Corporation
 
Consolidated Schedule of Investments (Continued)
 December 31, 2020
(in thousands, except shares)



 December 31, 2020
Investment TypePercent of Total
Investments at Fair Value
First lien
53.37 %
Second lien23.46 %
Subordinated1.25 %
Equity and other21.92 %
Total investments100.00 %
 
 December 31, 2020
Industry TypePercent of Total
Investments at Fair Value
Software27.60 %
Business Services21.11 %
Healthcare Services16.22 %
Education8.06 %
Investment Funds (includes investments in joint ventures)7.53 %
Net Lease5.11 %
Federal Services2.84 %
Consumer Services2.66 %
Specialty Chemicals & Materials2.09 %
Distribution & Logistics1.96 %
Healthcare Information Technology1.62 %
Industrial Services1.24 %
Energy1.15 %
Packaging0.44 %
Business Products0.37 %
Total investments100.00 %
 
 December 31, 2020
Interest Rate TypePercent of Total
Investments at Fair Value
Floating rates93.75 %
Fixed rates6.25 %
Total investments100.00 %

The accompanying notes are an integral part of these consolidated financial statements.
45


Notes to the Consolidated Financial Statements of
New Mountain Finance Corporation
 
March 31, 2021
(in thousands, except share data)
(unaudited)
Note 1. Formation and Business Purpose
    New Mountain Finance Corporation (“NMFC” or the “Company”) is a Delaware corporation that was originally incorporated on June 29, 2010 and completed its initial public offering ("IPO") on May 19, 2011. NMFC is a closed-end, non-diversified management investment company that has elected to be regulated as a business development company (“BDC”) under the Investment Company Act of 1940, as amended (the “1940 Act”). NMFC has elected to be treated, and intends to comply with the requirements to continue to qualify annually, as a regulated investment company (“RIC”) under Subchapter M of the Internal Revenue Code of 1986, as amended (the “Code”). NMFC is also registered as an investment adviser under the Investment Advisers Act of 1940, as amended (the “Advisers Act”). Since NMFC’s IPO, and through March 31, 2021, NMFC raised approximately $893,183 in net proceeds from additional offerings of its common stock.
    New Mountain Finance Advisers BDC, L.L.C. (the “Investment Adviser”) is a wholly-owned subsidiary of New Mountain Capital Group, L.P. (together with New Mountain Capital, L.L.C. and its affiliates, "New Mountain Capital") whose ultimate owners include Steven B. Klinsky and related and other vehicles. New Mountain Capital is a firm with a track record of investing in the middle market. New Mountain Capital focuses on investing in defensive growth companies across its private equity, public equity and credit investment vehicles. The Investment Adviser manages the Company's day-to-day operations and provides it with investment advisory and management services. The Investment Adviser also manages other funds that may have investment mandates that are similar, in whole or in part, to the Company's. New Mountain Finance Administration, L.L.C. (the "Administrator”), a wholly-owned subsidiary of New Mountain Capital, provides the administrative services necessary to conduct the Company's day-to-day operations.
    The Company has established the following wholly-owned direct and indirect subsidiaries:
New Mountain Finance Holdings, L.L.C. ("NMF Holdings" or the "Predecessor Operating Company") and New Mountain Finance DB, L.L.C. ("NMFDB"), whose assets are used to secure NMF Holdings’ credit facility and NMFDB’s credit facility, respectively;
New Mountain Finance SBIC, L.P. ("SBIC I")  and New Mountain Finance SBIC II, L.P. ("SBIC II"), who have received licenses from the United States ("U.S.") Small Business Administration ("SBA") to operate as small business investment companies ("SBICs") under Section 301(c) of the Small Business Investment Act of 1958, as amended (the "1958 Act"), and their general partners, New Mountain Finance SBIC G.P., L.L.C. ("SBIC I GP"), and New Mountain Finance SBIC II G.P., L.L.C. ("SBIC II GP"), respectively;
NMF Ancora Holdings Inc. ("NMF Ancora"), NMF QID Holdings, Inc. ("NMF QID"), NMF YP Holdings Inc. ("NMF YP") and NMF Permian Holdings LLC ("NMF Permian"), which serve as tax blocker corporations by holding equity or equity-like investments in portfolio companies organized as limited liability companies (or other forms of pass-through entities); the Company consolidates its tax blocker corporations for accounting purposes but the tax blocker corporations are not consolidated for U.S. federal income tax purposes and may incur U.S. federal income tax expense as a result of their ownership of the portfolio companies; and
New Mountain Finance Servicing, L.L.C. ("NMF Servicing"), which serves as the administrative agent on certain investment transactions.
    New Mountain Net Lease Corporation ("NMNLC") is a majority-owned consolidated subsidiary of the Company, which acquires commercial real estate properties that are subject to ‘‘triple net’’ leases has elected to be treated, and intends to comply with the requirements to continue to qualify annually, as a real estate investment trust, or REIT, within the meaning of Section 856(a) of the Code.
The Company’s investment objective is to generate current income and capital appreciation through the sourcing and origination of debt securities at all levels of the capital structure, including first and second lien debt, notes, bonds and mezzanine securities. The first lien debt may include traditional first lien senior secured loans or unitranche loans. Unitranche loans combine characteristics of traditional first lien senior secured loans as well as second lien and subordinated loans. Unitranche loans will expose the Company to the risks associated with second lien and subordinated loans to the extent the Company invests in the “last out” tranche. In some cases, the Company’s investments may also include equity interests. The Company's primary focus is in the debt of defensive growth companies, which are defined as generally exhibiting the following characteristics: (i) sustainable secular growth drivers, (ii) high barriers to competitive entry, (iii) high free cash flow after
46

capital expenditure and working capital needs, (iv) high returns on assets and (v) niche market dominance. Similar to the Company, SBIC I's and SBIC II's investment objectives are to generate current income and capital appreciation under the investment criteria used by the Company. However, SBIC I and SBIC II investments must be in SBA-eligible small businesses. The Company’s portfolio may be concentrated in a limited number of industries. As of March 31, 2021, the Company’s top five industry concentrations were software, business services, healthcare services, education and investment funds (which includes the Company's investments in its joint ventures).
Note 2. Summary of Significant Accounting Policies
Basis of accounting—The Company’s consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the U.S. ("GAAP"). The Company is an investment company following accounting and reporting guidance in Accounting Standards Codification Topic 946, Financial Services—Investment Companies, (“ASC 946”). NMFC consolidates its wholly-owned direct and indirect subsidiaries: NMF Holdings, NMFDB, NMF Servicing, SBIC I, SBIC I GP, SBIC II, SBIC II GP, NMF Ancora, NMF QID, NMF YP and NMF Permian and its majority-owned consolidated subsidiary: NMNLC. For majority-owned consolidated subsidiaries, the third-party equity interest is referred to as non-controlling interest. The net income attributable to non-controlling interests for such subsidiaries is presented as “Net increase (decrease) in net assets resulting from operations related to non-controlling interest” in the Company’s Consolidated Statements of Operations. The portion of shareholders' equity that is attributable to non-controlling interests for such subsidiaries is presented as “Non-controlling interest”, a component of total equity, on the Company’s Consolidated Statements of Assets and Liabilities.
The Company’s consolidated financial statements reflect all adjustments and reclassifications which, in the opinion of management, are necessary for the fair presentation of the results of operations and financial condition for all periods presented. All intercompany transactions have been eliminated. Revenues are recognized when earned and expenses when incurred. The financial results of the Company’s portfolio investments are not consolidated in the financial statements.
The Company’s interim consolidated financial statements are prepared in accordance with GAAP and pursuant to the requirements for reporting on Form 10-Q and Article 6 or 10 of Regulation S-X. Accordingly, the Company’s interim consolidated financial statements do not include all of the information and notes required by GAAP for annual financial statements. In the opinion of management, all adjustments, consisting solely of normal recurring accruals considered necessary for the fair presentation of financial statements for the interim period, have been included. The current period’s results of operations will not necessarily be indicative of results that ultimately may be achieved for the fiscal year ending December 31, 2021.
Investments—The Company applies fair value accounting in accordance with GAAP. Fair value is the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Investments are reflected on the Company’s Consolidated Statements of Assets and Liabilities at fair value, with changes in unrealized gains and losses resulting from changes in fair value reflected in the Company’s Consolidated Statements of Operations as “Net change in unrealized appreciation (depreciation) of investments” and realizations on portfolio investments reflected in the Company’s Consolidated Statements of Operations as “Net realized gains (losses) on investments”.
The Company values its assets on a quarterly basis, or more frequently if required under the 1940 Act. In all cases, the Company’s board of directors is ultimately and solely responsible for determining the fair value of the portfolio investments on a quarterly basis in good faith, including investments that are not publicly traded, those whose market prices are not readily available and any other situation where its portfolio investments require a fair value determination. Security transactions are accounted for on a trade date basis. The Company’s quarterly valuation procedures are set forth in more detail below:
(1)Investments for which market quotations are readily available on an exchange are valued at such market quotations based on the closing price indicated from independent pricing services.
(2)Investments for which indicative prices are obtained from various pricing services and/or brokers or dealers are valued through a multi-step valuation process, as described below, to determine whether the quote(s) obtained is representative of fair value in accordance with GAAP.
a.Bond quotes are obtained through independent pricing services. Internal reviews are performed by the investment professionals of the Investment Adviser to ensure that the quote obtained is representative of fair value in accordance with GAAP and, if so, the quote is used. If the Investment Adviser is unable to sufficiently validate the quote(s) internally and if the investment’s par value or its fair value exceeds the materiality threshold, the investment is valued similarly to those assets with no readily available quotes (see (3) below); and
b.For investments other than bonds, the Company looks at the number of quotes readily available and performs the following procedures:
47

i.Investments for which two or more quotes are received from a pricing service are valued using the mean of the mean of the bid and ask of the quotes obtained. The Company will evaluate the reasonableness of the quote, and if the quote is determined to not be representative of fair value, the Company will use one or more of the methodologies outlined below to determine fair value.
ii.Investments for which one quote is received from a pricing service are validated internally. The investment professionals of the Investment Adviser analyze the market quotes obtained using an array of valuation methods (further described below) to validate the fair value. If the Investment Adviser is unable to sufficiently validate the quote internally and if the investment’s par value or its fair value exceeds the materiality threshold, the investment is valued similarly to those assets with no readily available quotes (see (3) below).
(3)Investments for which quotations are not readily available through exchanges, pricing services, brokers, or dealers are valued through a multi-step valuation process:
a.Each portfolio company or investment is initially valued by the investment professionals of the Investment Adviser responsible for the credit monitoring;
b.Preliminary valuation conclusions will then be documented and discussed with the Company’s senior management;
c.If an investment falls into (3) above for four consecutive quarters and if the investment’s par value or its fair value exceeds the materiality threshold, then at least once each fiscal year, the valuation for each portfolio investment for which the Company does not have a readily available market quotation will be reviewed by an independent valuation firm engaged by the Company’s board of directors; and
d.When deemed appropriate by the Company’s management, an independent valuation firm may be engaged to review and value investment(s) of a portfolio company, without any preliminary valuation being performed by the Investment Adviser. The investment professionals of the Investment Adviser will review and validate the value provided.
For investments in revolving credit facilities and delayed draw commitments, the cost basis of the funded investments purchased is offset by any costs/netbacks received for any unfunded portion on the total balance committed. The fair value is also adjusted for the price appreciation or depreciation on the unfunded portion. As a result, the purchase of a commitment not completely funded may result in a negative fair value until it is called and funded.
The values assigned to investments are based upon available information and do not necessarily represent amounts which might ultimately be realized, since such amounts depend on future circumstances and cannot be reasonably determined until the individual positions are liquidated. Due to the inherent uncertainty of determining the fair value of investments that do not have a readily available market value, the fair value of the Company’s investments may fluctuate from period to period and the fluctuations could be material.
    See Note 3. Investments, for further discussion relating to investments.
    New Mountain Net Lease Corporation
    NMNLC was formed to acquire commercial real estate properties that are subject to "triple net" leases. NMNLC's investments are disclosed on the Company's Consolidated Schedule of Investments as of March 31, 2021.
    
    On March 30, 2020, an affiliate of the Investment Adviser purchased directly from NMNLC 105,030 shares of NMNLC’s common stock at a price of $107.73 per share, which represented the net asset value per share of NMNLC at the date of purchase, for an aggregate purchase price of approximately $11,315. Immediately thereafter, NMNLC redeemed 105,030 shares of its common stock held by NMFC in exchange for a promissory note with a principal amount of $11,315 and a 7.0% interest rate, which was repaid by NMNLC to NMFC on March 31, 2020.


48

Below is certain summarized property information for NMNLC as of March 31, 2021:
Lease Total Fair Value as of
Portfolio CompanyTenantExpiration DateLocationSquare FeetMarch 31, 2021
NM NL Holdings LP / NM GP Holdco LLCVariousVariousVariousVarious$102,635 
NM GLCR LPArctic Glacier U.S.A.2/28/2038CA21429,463 
NM CLFX LPVictor Equipment Company8/31/2033TX42314,896 
NM APP Canada, Corp.A.P. Plasman, Inc.9/30/2031Canada43612,488 
NM APP US LLCPlasman Corp, LLC / A-Brite LP9/30/2033AL / OH2617,525 
NM DRVT LLCFMH Conveyors, LLC10/31/2031AR1957,194 
NM YI, LLCYoung Innovations, Inc.10/31/2039IL / MO2126,866 
NM JRA LLCJ.R. Automation Technologies, LLC1/31/2031MI883,861 
NM KRLN LLCNoneN/AMD95717 
$185,645 
    Collateralized agreements or repurchase financings—The Company follows the guidance in Accounting Standards Codification Topic 860, Transfers and Servicing—Secured Borrowing and Collateral (“ASC 860”), when accounting for transactions involving the purchases of securities under collateralized agreements to resell (resale agreements). These transactions are treated as collateralized financing transactions and are recorded at their contracted resale or repurchase amounts, as specified in the respective agreements. Interest on collateralized agreements is accrued and recognized over the life of the transaction and included in interest income. As of March 31, 2021 and December 31, 2020, the Company held one collateralized agreement to resell with a cost basis of $30,000 and $30,000, respectively, and a fair value of $21,422 and $21,422, respectively. The collateralized agreement to resell is on non-accrual. The collateralized agreement to resell is guaranteed by a private hedge fund, PPVA Fund, L.P. The private hedge fund is currently in liquidation under the laws of the Cayman Islands. Pursuant to the terms of the collateralized agreement, the private hedge fund was obligated to repurchase the collateral from the Company at the par value of the collateralized agreement. The private hedge fund has breached its agreement to repurchase the collateral under the collateralized agreement. The default by the private hedge fund did not release the collateral to the Company, and therefore, the Company does not have full rights and title to the collateral. A claim has been filed with the Cayman Islands joint official liquidators to resolve this matter. The joint official liquidators have recognized the Company’s contractual rights under the collateralized agreement. The Company continues to exercise its rights under the collateralized agreement and continues to monitor the liquidation process of the private hedge fund. The fair value of the collateralized agreement to resell is reflective of the increased risk of the position.
Cash and cash equivalents—Cash and cash equivalents include cash and short-term, highly liquid investments. The Company defines cash equivalents as securities that are readily convertible into known amounts of cash and so near maturity that there is insignificant risk of changes in value. These securities have original maturities of three months or less. The Company did not hold any cash equivalents as of March 31, 2021 and December 31, 2020.
Revenue recognition
Sales and paydowns of investments:  Realized gains and losses on investments are determined on the specific identification method.
Interest and dividend income:  Interest income, including amortization of premium and discount using the effective interest method, is recorded on the accrual basis and periodically assessed for collectability. Interest income also includes interest earned from cash on hand. Upon the prepayment of a loan or debt security, any prepayment penalties are recorded as part of interest income. The Company has loans and certain preferred equity investments in the portfolio that contain a payment-in-kind (“PIK”) interest or dividend provision. PIK interest and dividends are accrued and recorded as income at the contractual rates, if deemed collectible. The PIK interest and dividends are added to the principal or share balances on the capitalization dates and are generally due at maturity or when redeemed by the issuer. For the three months ended March 31, 2021 and March 31, 2020, the Company recognized PIK and non-cash interest from investments of $5,838 and $3,490, respectively, and PIK and non-cash dividends from investments of $5,187 and $1,544, respectively.
Dividend income on common equity is recorded on the record date for private portfolio companies or on the ex-dividend date for publicly traded portfolio companies. Dividend income on preferred securities is recorded as dividend income on an accrual basis to the extent that such amounts are deemed collectible.
49

Non-accrual income:  Investments are placed on non-accrual status when principal or interest payments are past due for 30 days or more and when there is reasonable doubt that principal or interest will be collected. Accrued cash and un-capitalized PIK interest or dividends are reversed when an investment is placed on non-accrual status. Previously capitalized PIK interest or dividends are not reversed when an investment is placed on non-accrual status. Interest or dividend payments received on non-accrual investments may be recognized as income or applied to principal depending upon management’s judgment of the ultimate collectibility. Non-accrual investments are restored to accrual status when past due principal and interest is paid and, in management’s judgment, are likely to remain current.
Other income:  Other income represents delayed compensation, consent or amendment fees, revolver fees, structuring fees, upfront fees, management fees from a non-controlled/affiliated investment and other miscellaneous fees received and are typically non-recurring in nature. Delayed compensation is income earned from counterparties on trades that do not settle within a set number of business days after trade date. Other income may also include fees from bridge loans. The Company may from time to time enter into bridge financing commitments, an obligation to provide interim financing to a counterparty until permanent credit can be obtained. These commitments are short-term in nature and may expire unfunded. A fee is received by the Company for providing such commitments. Structuring fees and upfront fees are recognized as income when earned, usually when paid at the closing of the investment, and are non-refundable.
Interest and other financing expenses—Interest and other financing fees are recorded on an accrual basis by the Company. See Note 7. Borrowings, for details.
Deferred financing costs—The deferred financing costs of the Company consist of capitalized expenses related to the origination and amending of the Company’s borrowings. The Company amortizes these costs into expense over the stated life of the related borrowing. See Note 7. Borrowings, for details.
Deferred offering costs—The Company's deferred offering costs consist of fees and expenses incurred in connection with equity offerings and the filing of shelf registration statements. Upon the issuance of shares, offering costs are charged as a direct reduction to net assets. Deferred offering costs are included in other assets on the Company's Consolidated Statements of Assets and Liabilities.
Income taxes—The Company has elected to be treated, and intends to comply with the requirements to qualify annually, as a RIC under Subchapter M of the Code. As a RIC, the Company is not subject to U.S. federal income tax on the portion of taxable income and gains timely distributed to its stockholders.
To continue to qualify and be subject to tax as a RIC, the Company is required to meet certain income and asset diversification tests in addition to distributing at least 90.0% of its investment company taxable income, as defined by the Code. Since U.S. federal income tax regulations differ from GAAP, distributions in accordance with tax regulations may differ from net investment income and realized gains recognized for financial reporting purposes.
Differences between taxable income and the results of operations for financial reporting purposes may be permanent or temporary in nature. Permanent differences are reclassified among capital accounts in the financial statements to reflect their tax character. Differences in classification may also result from the treatment of short-term gains as ordinary income for U.S. federal income tax purposes.
For U.S. federal income tax purposes, distributions paid to stockholders of the Company are reported as ordinary income, return of capital, long term capital gains or a combination thereof.
The Company will be subject to a 4.0% nondeductible U.S. federal excise tax on certain undistributed income unless the Company distributes, in a timely manner as required by the Code, an amount at least equal to the sum of (1) 98.0% of its respective net ordinary income earned for the calendar year and (2) 98.2% of its respective capital gain net income for the one-year period ending October 31 in the calendar year.
Certain consolidated subsidiaries of the Company are subject to U.S. federal and state income taxes. These taxable entities are not consolidated for U.S. federal income tax purposes and may generate income tax liabilities or assets from permanent and temporary differences in the recognition of items for financial reporting and U.S. federal income tax purposes.
For the three months ended March 31, 2021 and March 31, 2020, the Company recognized a total income tax (provision) benefit of approximately $(116) and $898, respectively, for the Company’s consolidated subsidiaries. For the three months ended March 31, 2021 and March 31, 2020, the Company recorded current income tax expense of approximately $1 and $0, respectively, and deferred income tax (provision) benefit of approximately ($115) and $898, respectively.
As of March 31, 2021 and December 31, 2020, the Company had ($14) and $101, respectively, of deferred tax (liabilities) assets primarily relating to deferred taxes attributable to certain differences between the computation of income for U.S. federal income tax purposes as compared to GAAP.
50

Based on its analysis, the Company has determined that there were no uncertain income tax positions that do not meet the more likely than not threshold as defined by Accounting Standards Codification Topic 740 ("ASC 740") through December 31, 2020. The 2017 through 2020 tax years remain subject to examination by the U.S. federal, state, and local tax authorities.
Distributions—Distributions to common stockholders of the Company are recorded on the record date as set by the board of directors. The Company intends to make distributions to its stockholders that will be sufficient to enable the Company to maintain its status as a RIC. The Company intends to distribute approximately all of its net investment income (see Note 5. Agreements, for details) on a quarterly basis and substantially all of its taxable income on an annual basis, except that the Company may retain certain net capital gains for reinvestment.
The Company has adopted a dividend reinvestment plan that provides for reinvestment of any distributions declared on behalf of its stockholders, unless a stockholder elects to receive cash.
The Company applies the following in implementing the dividend reinvestment plan. If the price at which newly issued shares are to be credited to stockholders’ accounts is equal to or greater than 110.0% of the last determined net asset value of the shares, the Company will use only newly issued shares to implement its dividend reinvestment plan. Under such circumstances, the number of shares to be issued to a stockholder is determined by dividing the total dollar amount of the distribution payable to such stockholder by the market price per share of the Company’s common stock on the NASDAQ Global Select Market (the “NASDAQ”) on the distribution payment date. Market price per share on that date will be the closing price for such shares on the NASDAQ or, if no sale is reported for such day, the average of their electronically reported bid and ask prices.
If the price at which newly issued shares are to be credited to stockholders’ accounts is less than 110.0% of the last determined net asset value of the shares, the Company will either issue new shares or instruct the plan administrator to purchase shares in the open market to satisfy the additional shares required. Shares purchased in open market transactions by the plan administrator will be allocated to a stockholder based on the average purchase price, excluding any brokerage charges or other charges, of all shares of common stock purchased in the open market. The number of shares of the Company’s common stock to be outstanding after giving effect to payment of the distribution cannot be established until the value per share at which additional shares will be issued has been determined and elections of the Company’s stockholders have been tabulated.
Share repurchase program—On February 4, 2016, the Company's board of directors authorized a program for the purpose of repurchasing up to $50,000 worth of the Company's common stock (the "Repurchase Program"). Under the Repurchase Program, the Company was permitted, but was not obligated, to repurchase its outstanding common stock in the open market from time to time provided that it complied with the Company's code of ethics and the guidelines specified in Rule 10b-18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), including certain price, market volume and timing constraints. In addition, any repurchases were conducted in accordance with the 1940 Act. On December 31, 2020, the Company's board of directors extended the Company's Repurchase Program and the Company expects the Repurchase Program to be in place until the earlier of December 31, 2021 or until $50,000 of its outstanding shares of common stock have been repurchased. During the three months ended March 31, 2021 and March 31, 2020, the Company did not repurchase any shares of the Company's common stock. The Company previously repurchased $2,948 of its common stock under the Repurchase Program.
Earnings per share—The Company’s earnings per share (“EPS”) amounts have been computed based on the weighted-average number of shares of common stock outstanding for the period. Basic EPS is computed by dividing net increase (decrease) in net assets resulting from operations by the weighted average number of shares of common stock outstanding during the period of computation. Diluted EPS is computed by dividing net increase (decrease) in net assets resulting from operations by the weighted average number of shares of common stock assuming all potential shares had been issued, and its related net impact to net assets accounted for, and the additional shares of common stock were dilutive. Diluted EPS reflects the potential dilution, using the as-if-converted method for convertible debt, which could occur if all potentially dilutive securities were exercised.
Foreign securities—The accounting records of the Company are maintained in U.S. dollars. Investment securities denominated in foreign currencies are translated into U.S. dollars based on the rate of exchange of such currencies on the date of valuation. Purchases and sales of investment securities and income and expense items denominated in foreign currencies are translated into U.S. dollars based on the rate of exchange of such currencies on the respective dates of the transactions. The Company does not isolate that portion of the results of operations resulting from changes in foreign exchange rates on investments from the fluctuations arising from changes in market prices of securities held. Such fluctuations are included with “Net change in unrealized appreciation (depreciation)” and “Net realized gains (losses)” in the Company’s Consolidated Statements of Operations.
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Investments denominated in foreign currencies may be negatively affected by movements in the rate of exchange between the U.S. dollar and such foreign currencies. This movement is beyond the control of the Company and cannot be predicted.
Use of estimates—The preparation of the Company’s consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the Company’s consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Changes in the economic environment, financial markets, and other metrics used in determining these estimates could cause actual results to differ from the estimates used, and the differences could be material.
Dividend income recorded related to distributions received from flow-through investments is an accounting estimate based on the most recent estimate of the tax treatment of the distribution.
Note 3. Investments
At March 31, 2021, the Company’s investments consisted of the following:
Investment Cost and Fair Value by Type
 CostFair Value
First lien$1,594,970 $1,576,600 
Second lien699,432 696,209 
Subordinated41,803 37,295 
Equity and other693,102 708,508 
Total investments$3,029,307 $3,018,612 
Investment Cost and Fair Value by Industry
 CostFair Value
Software$860,577 $866,292 
Business Services698,935 648,235 
Healthcare Services498,062 497,886 
Education241,716 259,503 
Investment Funds (includes investments in joint ventures)232,400 232,400 
Net Lease151,211 185,645 
Federal Services64,193 65,223 
Distribution & Logistics65,630 61,032 
Specialty Chemicals & Materials61,901 57,747 
Healthcare Information Technology47,878 48,176 
Industrial Services36,494 36,652 
Energy45,173 35,947 
Packaging14,377 13,086 
Business Products10,760 10,788 
Total investments$3,029,307 $3,018,612 
52

At December 31, 2020, the Company’s investments consisted of the following:
Investment Cost and Fair Value by Type
 CostFair Value
First lien$1,601,438 $1,576,217 
Second lien699,263 692,828 
Subordinated46,407 36,939 
Equity and other650,561 647,518 
Total investments$2,997,669 $2,953,502 
Investment Cost and Fair Value by Industry
 CostFair Value
Software$810,907 $815,109 
Business Services673,680 623,609 
Healthcare Services483,845 479,084 
Education236,922 238,034 
Investment Funds (includes investments in joint ventures)222,400 222,400 
Net Lease116,791 150,829 
Federal Services82,637 83,742 
Consumer Services78,231 78,538 
Specialty Chemicals & Materials62,037 61,651 
Distribution & Logistics65,589 57,878 
Healthcare Information Technology47,610 47,915 
Industrial Services36,581 36,744 
Energy55,309 34,112 
Packaging14,371 13,069 
Business Products10,759 10,788 
Total investments$2,997,669 $2,953,502 

    During the first quarter of 2020, the Company placed its junior preferred shares in UniTek Global Services, Inc. ("UniTek") on non-accrual status. As of March 31, 2021, the Company's junior preferred shares in UniTek had an aggregate cost basis of $34,393, an aggregate fair value of $0 and total unearned dividend income of $1,396 for the three months then ended. During the fourth quarter of 2020, the Company placed an aggregate principal amount of $9,668 of its investment in the senior preferred shares of UniTek on non-accrual status. As of March 31, 2021, the Company's senior preferred shares in UniTek, which were placed on non-accrual status, had an aggregate cost basis of $9,668, an aggregate fair value of approximately $3,976 and total unearned dividend income of approximately $452 for the three months then ended.
During the first quarter of 2018, the Company placed its first lien positions in Education Management II LLC ("EDMC") on non-accrual status as EDMC announced its intention to wind down and liquidate the business. As of March 31, 2021, the Company's investment in EDMC, which was placed on non-accrual status, represented an aggregate cost basis of $957, an aggregate fair value of $0 and total unearned interest income of $0 for the three months then ended.
    As of March 31, 2021, the Company had unfunded commitments on revolving credit facilities and bridge facilities of $59,782 and $0, respectively. As of March 31, 2021, the Company had unfunded commitments in the form of delayed draws or other future funding commitments of $40,521. The unfunded commitments on revolving credit facilities and delayed draws are disclosed on the Company’s Consolidated Schedule of Investments as of March 31, 2021.
As of December 31, 2020, the Company had unfunded commitments on revolving credit facilities and bridge facilities of $63,411 and $0, respectively. As of December 31, 2020, the Company had unfunded commitments in the form of delayed draws or other future funding commitments of $9,715. The unfunded commitments on revolving credit facilities and delayed draws are disclosed on the Company’s Consolidated Schedule of Investments as of December 31, 2020.

53

PPVA Black Elk (Equity) LLC
On May 3, 2013, the Company entered into a collateralized securities purchase and put agreement (the “SPP Agreement”) with a private hedge fund. Under the SPP Agreement, the Company purchased twenty million Class E Preferred Units of Black Elk Energy Offshore Operations, LLC (“Black Elk”) for $20,000 with a corresponding obligation of the private hedge fund, PPVA Black Elk (Equity) LLC, to repurchase the preferred units for $20,000 plus other amounts due under the SPP Agreement. The majority owner of Black Elk was the private hedge fund. In August 2014, the Company received a payment of $20,540, the full amount due under the SPP Agreement.
In August 2017, a trustee (the “Trustee”) for Black Elk informed the Company that the Trustee intended to assert a fraudulent conveyance claim (the “Claim”) against the Company and one of its affiliates seeking the return of the $20,540 repayment. Black Elk filed a Chapter 11 bankruptcy petition pursuant to the United States Bankruptcy Code in August 2015. The Trustee alleged that individuals affiliated with the private hedge fund conspired with Black Elk and others to improperly use proceeds from the sale of certain Black Elk assets to repay, in August 2014, the private hedge fund’s obligation to the Company under the SPP Agreement. The Company was unaware of these claims at the time the repayment was received. The private hedge fund is currently in liquidation under the laws of the Cayman Islands.
On December 22, 2017, the Company settled the Trustee’s $20,540 Claim for $16,000 and filed a claim with the Cayman Islands joint official liquidators of the private hedge fund for $16,000 that is owed to the Company under the SPP Agreement. The SPP Agreement was restored and is in effect since repayment has not been made. The Company continues to exercise its rights under the SPP Agreement and continues to monitor the liquidation process of the private hedge fund. During the year ended December 31, 2018, the Company received a $1,500 payment from its insurance carrier in respect to the settlement. As of March 31, 2021 and December 31, 2020, the SPP Agreement has a cost basis of $14,500 and $14,500, respectively, and a fair value of $10,354 and $10,354, respectively, which is reflective of the higher inherent risk in this transaction.
NMFC Senior Loan Program I LLC
NMFC Senior Loan Program I LLC (“SLP I”) was formed as a Delaware limited liability company on May 27, 2014 and commenced operations on June 10, 2014. SLP I is a portfolio company held by the Company. SLP I was structured as a private investment fund, in which all of the investors were "qualified purchasers", as such term is defined in Section 2(a)(51) of the 1940 Act. Transfer of interests in SLP I are subject to restrictions and, as a result, interests are not readily marketable. SLP I operates under a limited liability company agreement (the “SLP I Agreement”) and will continue in existence until August 31, 2022, subject to earlier termination pursuant to certain terms of the SLP I Agreement. The term may be extended pursuant to certain terms of the SLP I Agreement. SLP I invests in senior secured loans issued by companies within the Company’s core industry verticals. These investments are typically broadly syndicated first lien loans.
SLP I's re-investment period ended on August 31, 2020. As of this date, SLP I ceased new investment activity and any principal repayments from investments were used to repay SLP I's revolving credit facility. Due to the expiration of the investment period, a member of SLP I expressed an interest to withdraw from SLP I. Effective December 11, 2020, this member, with the consent of the other members of SLP I pursuant to the Withdrawal and Distribution Agreement dated as of December 11, 2020, fully withdrew as a member of SLP I through an in-kind distribution. Immediately following the effectiveness of the withdrawal, the remaining members of SLP I entered into the First Amended and Restated Limited Liability Company Agreement (the “Restated SLP I Agreement”), which among other matters, removed the Company as the managing member of SLP I and made other changes to its governance and management. Under the Restated SLP I Agreement, SLP I is managed and all investment decisions are made by a board of members, which has equal representation from all members of SLP I. No revisions were made to the term of SLP I or the reinvestment period end date.
As of March 31, 2021, SLP I had total investments with an aggregate fair value of approximately $125,861, debt outstanding of $88,567 and capital that had been called and funded of $43,000. As of December 31, 2020, SLP I had total investments with an aggregate fair value of approximately $124,659, debt outstanding of $188,867 and capital that had been called and funded of $43,000. The Company’s investment in SLP I is disclosed on the Company’s Consolidated Schedule of Investments as of March 31, 2021 and December 31, 2020.


54

Below is a summary of SLP I's portfolio, along with a listing of the individual investments in SLP I's portfolio as of March 31, 2021 and December 31, 2020.
March 31, 2021December 31, 2020
First lien investments (1)$127,366 $127,660 
Weighted average interest rate on first lien investments (2)4.74 %4.85 %
Number of portfolio companies in SLP I34 34 
Largest portfolio company investment (1)$7,778 $7,797 
Total of five largest portfolio company investments (1)$34,847 $34,918 
(1)Reflects principal amount or par value of investment.
(2)Computed as the all in interest rate in effect on accruing investments divided by the total principal amount of investments.


55

The following table is a listing of the individual investments in SLP I's portfolio as of March 31, 2021:
Portfolio Company and Type of InvestmentIndustryInterest Rate (1)Maturity Date Principal Amount or Par Value CostFair
Value (2)
Funded Investments - First lien
Access CIG, LLCBusiness Services 3.87% (L + 3.75%) 2/27/2025$3,669 $3,692 $3,648 
Advisor Group Holdings, Inc.Consumer Services 4.61% (L + 4.50%) 7/31/20266,849 6,794 6,852 
Affordable Care Holding Corp.Healthcare Services 5.75% (L + 4.75%) 10/24/20226,596 6,565 6,497 
ASG Technologies Group, Inc. Software 4.50% (L + 3.50%) 7/31/2024651 649 643 
BarBri, Inc.Education 5.00% (L + 4.00%) 12/1/20235,980 5,965 5,920 
Bearcat Buyer, Inc.Healthcare Services 5.25% (L + 4.25%) 7/9/2026130 130 130 
Bearcat Buyer, Inc.Healthcare Services 5.25% (L + 4.25%) 7/9/2026629 627 629 
Bracket Intermediate Holding Corp.Healthcare Services 4.49% (L + 4.25%) 9/5/20254,508 4,493 4,502 
Certara Holdco, Inc.Healthcare Information Technology 3.70% (L + 3.50%) 8/15/20245,125 5,121 5,125 
CHA Holdings, Inc.Business Services 5.50% (L + 4.50%) 4/10/2025451 451 421 
Cvent, Inc.Software 3.90% (L + 3.75%) 11/29/20246,727 6,716 6,574 
Dealer Tire, LLCDistribution & Logistics 4.36% (L + 4.25%) 12/12/20253,424 3,417 3,434 
Drilling Info Holdings, Inc.Business Services 4.36% (L + 4.25%) 7/30/20256,088 6,070 5,996 
Emerald 2 LimitedBusiness Services 3.61% (L + 3.50%) 7/10/2026447 447 445 
eResearchTechnology, Inc.Healthcare Services 5.50% (L + 4.50%) 2/4/20271,342 1,331 1,345 
Fastlane Parent Company, Inc.Distribution & Logistics 4.61% (L + 4.50%) 2/4/20261,359 1,339 1,359 
Greenway Health, LLCSoftware 4.75% (L + 3.75%) 2/16/20246,675 6,660 6,383 
Heartland Dental, LLCHealthcare Services 3.61% (L + 3.50%) 4/30/20253,600 3,589 3,549 
Help/Systems Holdings, Inc.Software 5.75% (L + 4.75%) 11/19/2026137 137 138 
LSCS Holdings, Inc.Healthcare Services 4.51% (L + 4.25%) 3/17/20251,368 1,364 1,355 
LSCS Holdings, Inc.Healthcare Services 4.51% (L + 4.25%) 3/17/20255,301 5,285 5,248 
Market Track, LLCBusiness Services 5.25% (L + 4.25%) 6/5/2024779 781 779 
Medical Solutions Holdings, Inc.Healthcare Services 5.50% (L + 4.50%) 6/14/20242,243 2,240 2,247 
Ministry Brands, LLCSoftware 5.00% (L + 4.00%) 12/2/20224,863 4,856 4,850 
National Intergovernmental Purchasing Alliance CompanyBusiness Services 3.95% (L + 3.75%) 5/23/20251,349 1,350 1,346 
Pelican Products, Inc.Business Products 4.50% (L + 3.50%) 5/1/20252,248 2,244 2,227 
Premise Health Holding Corp.Healthcare Services 3.70% (L + 3.50%) 7/10/2025627 624 624 
Project Accelerate Parent, LLCBusiness Services 5.25% (L + 4.25%) 1/2/20254,164 4,149 4,015 
PSC Industrial Holdings Corp.Industrial Services 4.75% (L + 3.75%) 10/11/20243,896 3,875 3,815 
Salient CRGT Inc.Federal Services 7.50% (L + 6.50%) 2/28/20226,731 6,717 6,731 
Sierra Enterprises, LLCFood & Beverage 5.00% (L + 4.00%) 11/11/20244,249 4,233 4,195 
Wirepath LLCDistribution & Logistics 4.20% (L + 4.00%) 8/5/20246,762 6,762 6,661 
WP CityMD Bidco LLCHealthcare Services 4.50% (L + 3.75%) 8/13/20266,133 6,083 6,132 
Wrench Group LLCConsumer Services 4.20% (L + 4.00%) 4/30/20262,734 2,712 2,734 
YI, LLCHealthcare Services 5.00% (L + 4.00%) 11/7/20247,778 7,771 7,564 
Zelis Cost Management Buyer, Inc.Healthcare Information Technology 3.62% (L + 3.50%) 9/30/20261,754 1,739 1,748 
Total Funded Investments$127,366 $126,978 $125,861 
(1)All interest is payable in cash unless otherwise indicated. A majority of the variable rate debt investments bear interest at a rate that may be determined by reference to the LIBOR (L), the Prime Rate (P) and the alternative base rate (Base). For each investment, the current interest rate provided reflects the rate in effect as of March 31, 2021.
(2)Represents the fair value in accordance with Accounting Standards Codification Topic 820, Fair Value Measurement and Disclosures ("ASC 820"). The Company's board of directors does not determine the fair value of the investments held by SLP I.
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The following table is a listing of the individual investments in SLP I's portfolio as of December 31, 2020:
Portfolio Company and Type of InvestmentIndustryInterest Rate (1)Maturity Date Principal Amount or Par Value CostFair
Value (2)
Funded Investments - First lien
Access CIG, LLCBusiness Services 3.98% (L + 3.75%) 2/27/2025$3,678 $3,701 $3,649 
Advisor Group Holdings, Inc.Consumer Services 5.15% (L + 5.00%) 7/31/20266,866 6,809 6,836 
Affordable Care Holding Corp.Healthcare Services 5.75% (L + 4.75%) 10/24/20226,614 6,578 6,531 
ASG Technologies Group, Inc. Software 4.50% (L + 3.50%) 7/31/2024653 651 636 
BarBri, Inc.Education 5.00% (L + 4.00%) 12/1/20235,980 5,964 5,980 
Bearcat Buyer, Inc.Healthcare Services 5.25% (L + 4.25%) 7/9/2026131 130 131 
Bearcat Buyer, Inc.Healthcare Services 5.25% (L + 4.25%) 7/9/2026631 628 631 
Bracket Intermediate Holding Corp.Healthcare Services 4.48% (L + 4.25%) 9/5/20254,520 4,504 4,474 
Certara Holdco, Inc.Healthcare Information Technology 3.75% (L + 3.50%) 8/15/20245,138 5,134 5,145 
CHA Holdings, Inc.Business Services 5.50% (L + 4.50%) 4/10/2025452 452 423 
Cvent, Inc.Software 3.90% (L + 3.75%) 11/29/20246,745 6,732 6,479 
Dealer Tire, LLCDistribution & Logistics 4.40% (L + 4.25%) 12/12/20253,433 3,426 3,419 
Drilling Info Holdings, Inc.Business Services 4.40% (L + 4.25%) 7/30/20256,103 6,084 5,925 
Emerald 2 LimitedBusiness Services 3.50% (L + 3.25%) 7/10/2026449 448 445 
eResearchTechnology, Inc.Healthcare Services 5.50% (L + 4.50%) 2/4/20271,345 1,333 1,336 
Fastlane Parent Company, Inc.Distribution & Logistics 4.65% (L + 4.50%) 2/4/20261,363 1,342 1,355 
Greenway Health, LLCSoftware 4.75% (L + 3.75%) 2/16/20246,693 6,677 6,141 
Heartland Dental, LLCHealthcare Services 3.65% (L + 3.50%) 4/30/20253,609 3,597 3,524 
HS Purchaser, LLC / Help/Systems Holdings, Inc.Software 5.75% (L + 4.75%) 11/19/2026138 137 138 
LSCS Holdings, Inc.Healthcare Services 4.51% (L + 4.25%) 3/17/20251,372 1,367 1,344 
LSCS Holdings, Inc.Healthcare Services 4.51% (L + 4.25%) 3/17/20255,314 5,297 5,208 
Market Track, LLCBusiness Services 5.25% (L + 4.25%) 6/5/2024781 783 767 
Medical Solutions Holdings, Inc.Healthcare Services 5.50% (L + 4.50%) 6/14/20242,249 2,245 2,237 
Ministry Brands, LLCSoftware 5.00% (L + 4.00%) 12/2/20224,876 4,868 4,852 
National Intergovernmental Purchasing Alliance CompanyBusiness Services 4.00% (L + 3.75%) 5/23/20251,352 1,354 1,346 
Pelican Products, Inc.Business Products 4.50% (L + 3.50%) 5/1/20252,254 2,250 2,217 
Premise Health Holding Corp.Healthcare Services 3.75% (L + 3.50%) 7/10/2025628 626 614 
Project Accelerate Parent, LLCBusiness Services 5.25% (L + 4.25%) 1/2/20254,175 4,159 3,799 
PSC Industrial Holdings Corp.Industrial Services 4.75% (L + 3.75%) 10/11/20243,906 3,883 3,799 
Salient CRGT Inc.Federal Services 7.50% (L + 6.50%) 2/28/20226,731 6,713 6,731 
Sierra Enterprises, LLCFood & Beverage 5.00% (L + 4.00%) 11/11/20244,260 4,243 4,192 
Wirepath LLCDistribution & Logistics 4.25% (L + 4.00%) 8/5/20246,779 6,779 6,542 
WP CityMD Bidco LLCHealthcare Services 5.50% (L + 4.50%) 8/13/20266,148 6,096 6,162 
Wrench Group LLCConsumer Services 4.25% (L + 4.00%) 4/30/20262,739 2,716 2,712 
YI, LLCHealthcare Services 5.00% (L + 4.00%) 11/7/20247,797 7,792 7,174 
Zelis Cost Management Buyer, Inc.Healthcare Information Technology 4.90% (L + 4.75%) 9/30/20261,758 1,743 1,765 
Total Funded Investments$127,660 $127,241 $124,659 
(1)All interest is payable in cash unless otherwise indicated. A majority of the variable rate debt investments bear interest at a rate that may be determined by reference to the LIBOR (L), the Prime Rate (P) and the alternative base rate (Base). For each investment, the current interest rate provided reflects the rate in effect as of December 31, 2020.
(2)Represents the fair value in accordance with ASC 820. The Company's board of directors does not determine the fair value of the investments held by SLP I.


57

Below is certain summarized financial information for SLP I as of March 31, 2021 and December 31, 2020 and for the three months ended March 31, 2021 and March 31, 2020:

Selected Balance Sheet Information:March 31, 2021December 31, 2020
Investments at fair value (cost of $126,978 and $127,241, respectively)$125,861 $124,659 
Receivable from in-kind distributions— 100,404 
Receivable from unsettled securities sold— 1,662 
Cash and other assets6,308 6,461 
Total assets$132,169 $233,186 
Credit facility$88,567 $188,867 
Deferred financing costs(233)(296)
Distribution payable1,075 2,538 
Other liabilities689 1,364 
Total liabilities90,098 192,473 
Members' capital$42,071 $40,713 
Total liabilities and members' capital$132,169 $233,186 

Selected Statement of OperationsThree Months Ended
 Information:March 31, 2021March 31, 2020
Interest income$1,966 $5,122 
Other income11 39 
Total investment income1,977 5,161 
Interest and other financing expenses471 1,954 
Other expenses539 398 
Total expenses1,010 2,352 
Less: expenses waived and reimbursed— (56)
Net expenses1,010 2,296 
Net investment income967 2,865 
Net realized gains on investments45 
Net change in unrealized appreciation (depreciation) of investments1,465 (39,060)
Net increase (decrease) in members' capital $2,433 $(36,150)
58

Pursuant to the Restated SLP I Agreement, the Company is no longer entitled to, and SLP I no longer pays management fees for investment management services provided to SLP I. For the three months ended March 31, 2021 and March 31, 2020, the Company earned approximately $0 and $267, respectively, in management fees related to SLP I, which is included in other income. As of March 31, 2021 and December 31, 2020, approximately $0 and $117, respectively, of management fees related to SLP I was included in receivable from affiliates. For the three months ended March 31, 2021 and March 31, 2020, the Company earned approximately $575 and $720, respectively, of dividend income related to SLP I, which is included in dividend income. As of March 31, 2021 and December 31, 2020, approximately $575 and $657, respectively, of dividend income related to SLP I was included in interest and dividend receivable.
The Company has determined that SLP I is an investment company under ASC 946; however, in accordance with such guidance the Company will generally not consolidate its investment in a company other than a wholly-owned investment company subsidiary. Furthermore, Accounting Standards Codification Topic 810, Consolidation ("ASC 810"), concludes that in an investment fund where all members have equal decision making authority, it is not appropriate for one member to consolidate since neither has control. Accordingly, the Company does not consolidate SLP I.
NMFC Senior Loan Program II LLC
NMFC Senior Loan Program II LLC ("SLP II") was formed as a Delaware limited liability company on March 9, 2016 and commenced operations on April 12, 2016. SLP II is structured as a private joint venture investment fund between the Company and SkyKnight Income, LLC (“SkyKnight”) and operates under a limited liability company agreement (the "SLP II Agreement"). The purpose of the joint venture is to invest primarily in senior secured loans issued by portfolio companies within the Company's core industry verticals. These investments are typically broadly syndicated first lien loans. All investment decisions must be unanimously approved by the board of managers of SLP II, which has equal representation from the Company and SkyKnight. SLP II's investment period ended on April 12, 2020 and SLP II will continue in existence until April 12, 2022. The term may be extended for up to one year pursuant to certain terms of the SLP II Agreement.
    SLP II is capitalized with equity contributions which are called from its members, on a pro-rata basis based on their equity commitments, as transactions are completed. Any decision by SLP II to call down on capital commitments requires approval by the board of managers of SLP II. As of March 31, 2021, the Company and SkyKnight have committed and contributed $79,400 and $20,600, respectively, of equity to SLP II. The Company’s investment in SLP II is disclosed on the Company’s Consolidated Schedule of Investments as of March 31, 2021 and December 31, 2020.
    On April 12, 2016, SLP II entered into its revolving credit facility with Wells Fargo Bank, National Association, which matures on April 12, 2022 and bears interest at a rate of the London Interbank Offered Rate ("LIBOR") plus 1.60% per annum. As of March 31, 2021 and December 31, 2020, SLP II had total investments with an aggregate fair value of approximately $250,917 and $271,149, respectively, and debt outstanding under its credit facility of $160,670 and $183,970, respectively. As of March 31, 2021 and December 31, 2020, none of SLP II's investments were on non-accrual.
Below is a summary of SLP II's portfolio, along with a listing of the individual investments in SLP II's portfolio as of March 31, 2021 and December 31, 2020:
March 31, 2021December 31, 2020
First lien investments (1)$255,235 $279,678 
Weighted average interest rate on first lien investments (2)4.95 %5.07 %
Number of portfolio companies in SLP II30 32 
Largest portfolio company investment (1)$16,501 $16,481 
Total of five largest portfolio company investments (1)$75,392 $75,522 
(1)Reflects principal amount or par value of investment.
(2)Computed as the all in interest rate in effect on accruing investments divided by the total principal amount of investments.
59

    The following table is a listing of the individual investments in SLP II's portfolio as of March 31, 2021:
Portfolio Company and Type of InvestmentIndustryInterest Rate (1)Maturity Date Principal Amount or Par Value CostFair
Value (2)
Funded Investments - First lien:
Access CIG, LLCBusiness Services 3.87% (L + 3.75%) 2/27/2025$4,601 $4,587 $4,575 
ADG, LLCHealthcare Services 6.25 % (L + 4.75% + 0.50% PIK) 9/28/202316,501 16,436 15,939 
Advisor Group Holdings, Inc.Consumer Services 4.61% (L + 4.50%) 7/31/20264,938 4,898 4,940 
Bearcat Buyer, Inc.Healthcare Services 5.25% (L + 4.25%) 7/9/2026282 281 282 
Bearcat Buyer, Inc.Healthcare Services 5.25% (L + 4.25%) 7/9/20261,361 1,356 1,361 
Bleriot US Bidco Inc.Federal Services 4.20% (L + 4.00%) 10/30/20269,900 9,817 9,888 
Brave Parent Holdings, Inc. Software 4.11% (L + 4.00%) 4/18/20253,643 3,634 3,646 
CentralSquare Technologies, LLCSoftware 3.95% (L + 3.75%) 8/29/202514,663 14,638 14,069 
CHA Holdings, Inc.Business Services 5.50% (L + 4.50%) 4/10/20252,021 2,014 1,890 
CHA Holdings, Inc.Business Services 5.50% (L + 4.50%) 4/10/202510,561 10,531 9,874 
Dealer Tire, LLCDistribution & Logistics 4.36% (L + 4.25%) 12/12/20257,406 7,391 7,428 
Drilling Info Holdings, Inc.Business Services 4.36% (L + 4.25%) 7/30/202514,571 14,528 14,352 
Edgewood Partners Holdings LLC (EPIC)Business Services 5.25% (L + 4.25%) 9/6/20247,337 7,289 7,264 
eResearchTechnology, Inc.Healthcare Services 5.50% (L + 4.50%) 2/4/20273,121 3,094 3,128 
Fastlane Parent Company, Inc.Distribution & Logistics 4.61% (L + 4.50%) 2/4/20263,430 3,380 3,428 
Greenway Health, LLCSoftware 4.75% (L + 3.75%) 2/16/202414,438 14,404 13,806 
Help/Systems Holdings, Inc.Software 5.75% (L + 4.75%) 11/19/20264,400 4,363 4,432 
Keystone Acquisition Corp.Healthcare Services 6.25% (L + 5.25%) 5/1/20245,211 5,185 5,028 
LSCS Holdings, Inc.Healthcare Services 4.51% (L + 4.25%) 3/17/20251,860 1,859 1,842 
LSCS Holdings, Inc.Healthcare Services 4.51% (L + 4.25%) 3/17/20257,206 7,201 7,134 
Market Track, LLCBusiness Services 5.25% (L + 4.25%) 6/5/202411,550 11,521 11,550 
Medical Solutions Holdings, Inc.Healthcare Services 5.50% (L + 4.50%) 6/14/20242,760 2,753 2,765 
Ministry Brands, LLCSoftware 5.00% (L + 4.00%) 12/2/20222,068 2,064 2,062 
Ministry Brands, LLCSoftware 5.00% (L + 4.00%) 12/2/2022869 867 866 
Ministry Brands, LLCSoftware 5.00% (L + 4.00%) 12/2/202212,003 11,983 11,969 
Premise Health Holding Corp.Healthcare Services 3.70% (L + 3.50%) 7/10/20251,355 1,350 1,346 
Project Accelerate Parent, LLCBusiness Services 5.25% (L + 4.25%) 1/2/202512,386 12,349 11,942 
PSC Industrial Holdings Corp.Industrial Services 4.75% (L + 3.75%) 10/11/20243,021 3,004 2,958 
Quest Software US Holdings Inc.Software 4.46% (L + 4.25%) 5/16/202514,663 14,616 14,678 
Salient CRGT Inc.Federal Services 7.50% (L + 6.50%) 2/28/202212,478 12,451 12,478 
Wirepath LLCDistribution & Logistics 4.20% (L + 4.00%) 8/5/202414,625 14,625 14,406 
WP CityMD Bidco LLCHealthcare Services 4.50% (L + 3.75%) 8/13/20265,404 5,361 5,404 
Wrench Group LLCConsumer Services 4.20% (L + 4.00%) 4/30/20265,913 5,866 5,913 
YI, LLCHealthcare Services 5.00% (L + 4.00%) 11/7/202414,611 14,604 14,209 
Zelis Cost Management Buyer, Inc.Healthcare Information Technology 3.62% (L + 3.50%) 9/30/20264,078 4,044 4,065 
Total Funded Investments$255,235 $254,344 $250,917 
(1)All interest is payable in cash unless otherwise indicated. A majority of the variable rate debt investments bear interest at a rate that may be determined by reference to the LIBOR (L), the Prime Rate (P) and the alternative base rate (Base). For each investment, the current interest rate provided reflects the rate in effect as of March 31, 2021.
(2)Represents the fair value in accordance with ASC 820. The Company's board of directors does not determine the fair value of the investments held by SLP II.
60

    The following table is a listing of the individual investments in SLP II's portfolio as of December 31, 2020:
Portfolio Company and Type of InvestmentIndustryInterest Rate (1)Maturity Date Principal Amount or Par Value CostFair
Value (2)
Funded Investments - First lien
Access CIG, LLCBusiness Services3.98% (L + 3.75%)2/27/2025$4,613 $4,598 $4,577 
ADG, LLCHealthcare Services6.25 % (L + 4.75% + 0.50% PIK)9/28/202316,481 16,410 15,612 
Advisor Group Holdings, Inc.Consumer Services5.15% (L + 5.00%)7/31/20264,950 4,909 4,928 
Bearcat Buyer, Inc.Healthcare Services5.25% (L + 4.25%)7/9/2026283 282 283 
Bearcat Buyer, Inc.Healthcare Services5.25% (L + 4.25%)7/9/20261,365 1,359 1,365 
Bleriot US Bidco Inc.Federal Services5.00% (L + 4.75%)10/31/20261,341 1,329 1,341 
Bleriot US Bidco Inc.Federal Services5.00% (L + 4.75%)10/30/20268,584 8,509 8,584 
Brave Parent Holdings, Inc.Software4.15% (L + 4.00%)4/18/20253,652 3,643 3,630 
CentralSquare Technologies, LLCSoftware4.00% (L + 3.75%)8/29/202514,700 14,674 13,745 
CHA Holdings, Inc.Business Services5.50% (L + 4.50%)4/10/20252,026 2,019 1,895 
CHA Holdings, Inc.Business Services5.50% (L + 4.50%)4/10/202510,588 10,556 9,900 
Dealer Tire, LLCDistribution & Logistics4.40% (L + 4.25%)12/12/20257,425 7,409 7,394 
Drilling Info Holdings, Inc.Business Services4.40% (L + 4.25%)7/30/202514,608 14,563 14,182 
Edgewood Partners Holdings LLC (EPIC)Business Services5.25% (L + 4.25%)9/6/20247,356 7,304 7,301 
eResearchTechnology, Inc.Healthcare Services5.50% (L + 4.50%)2/4/20273,129 3,101 3,106 
Fastlane Parent Company, Inc.Distribution & Logistics4.65% (L + 4.50%)2/4/20263,439 3,386 3,419 
Greenway Health, LLCSoftware4.75% (L + 3.75%)2/16/202414,475 14,439 13,281 
HS Purchaser, LLC / Help/Systems Holdings, Inc.Software5.75% (L + 4.75%)11/19/20264,411 4,373 4,411 
Institutional Shareholder Services Inc.Business Services4.75% (L + 4.50%)3/5/202613,755 13,648 13,600 
Keystone Acquisition Corp.Healthcare Services6.25% (L + 5.25%)5/1/20245,225 5,196 4,937 
LSCS Holdings, Inc.Healthcare Services4.51% (L + 4.25%)3/17/20251,865 1,863 1,828 
LSCS Holdings, Inc.Healthcare Services4.51% (L + 4.25%)3/17/20257,225 7,219 7,080 
Market Track, LLCBusiness Services5.25% (L + 4.25%)6/5/202411,580 11,549 11,376 
Medical Solutions Holdings, Inc.Healthcare Services5.50% (L + 4.50%)6/14/20242,767 2,760 2,753 
Ministry Brands, LLCSoftware5.00% (L + 4.00%)12/2/20222,073 2,069 2,063 
Ministry Brands, LLCSoftware5.00% (L + 4.00%)12/2/2022871 869 867 
Ministry Brands, LLCSoftware5.00% (L + 4.00%)12/2/202212,034 12,011 11,975 
Peraton Corp. (fka MHVC Acquisition Corp.)Federal Services6.25% (L + 5.25%)4/29/202410,133 10,105 10,158 
Premise Health Holding Corp.Healthcare Services3.75% (L + 3.50%)7/10/20251,358 1,354 1,328 
Project Accelerate Parent, LLCBusiness Services5.25% (L + 4.25%)1/2/202512,418 12,379 11,300 
PSC Industrial Holdings Corp.Industrial Services4.75% (L + 3.75%)10/11/20243,028 3,011 2,945 
Quest Software US Holdings Inc.Software4.46% (L + 4.25%)5/16/202514,700 14,650 14,480 
Salient CRGT Inc.Federal Services7.50% (L + 6.50%)2/28/202212,478 12,445 12,478 
Wirepath LLCDistribution & Logistics4.25% (L + 4.00%)8/5/202414,663 14,663 14,149 
WP CityMD Bidco LLCHealthcare Services5.50% (L + 4.50%)8/13/20265,418 5,372 5,431 
Wrench Group LLCConsumer Services4.25% (L + 4.00%)4/30/20265,924 5,875 5,865 
YI, LLCHealthcare Services5.00% (L + 4.00%)11/7/202414,649 14,641 13,477 
Zelis Cost Management Buyer, Inc.Healthcare Information Technology4.90% (L + 4.75%)9/30/20264,088 4,053 4,105 
Total Funded Investments$279,678 $278,595 $271,149 
(1)All interest is payable in cash unless otherwise indicated. A majority of the variable rate debt investments bear interest at a rate that may be determined by reference to the LIBOR (L), the Prime Rate (P) and the alternative base rate (Base). For each investment, the current interest rate provided reflects the rate in effect as of December 31, 2020.
(2)Represents the fair value in accordance with ASC 820. The Company's board of directors does not determine the fair value of the investments held by SLP II.


61

    Below is certain summarized financial information for SLP II as of March 31, 2021 and December 31, 2020 and for the three months ended March 31, 2021 and March 31, 2020:
Selected Balance Sheet Information:March 31, 2021December 31, 2020
Investments at fair value (cost of $254,344 and $278,595, respectively)$250,917 $271,149 
Cash and other assets9,724 8,759 
Total assets$260,641 $279,908 
Credit facility$160,670 $183,970 
Deferred financing costs(315)(534)
Distribution payable2,500 2,500 
Other liabilities904 1,058 
Total liabilities163,759 186,994 
Members' capital$96,882 $92,914 
Total liabilities and members' capital$260,641 $279,908 
Selected Statement of OperationsThree Months Ended
 Information:March 31, 2021March 31, 2020
Interest income$3,534 $5,447 
Other income— 53 
Total investment income3,534 5,500 
Interest and other financing expenses980 2,145 
Other expenses107 132 
Total expenses1,087 2,277 
Net investment income2,447 3,223 
Net realized gains on investments56 
Net change in unrealized appreciation (depreciation) of investments4,019 (34,801)
Net increase (decrease) in members' capital $6,468 $(31,522)
For the three months ended March 31, 2021 and March 31, 2020, the Company earned approximately $1,985 and $2,581, respectively, of dividend income related to SLP II, which is included in dividend income. As of March 31, 2021 and December 31, 2020, approximately $1,985 and $1,985, respectively, of dividend income related to SLP II was included in interest and dividend receivable.
    The Company has determined that SLP II is an investment company under ASC 946; however, in accordance with such guidance the Company will generally not consolidate its investment in a company other than a wholly-owned investment company subsidiary. Furthermore, ASC 810, concludes that in a joint venture where both members have equal decision making authority, it is not appropriate for one member to consolidate the joint venture since neither has control. Accordingly, the Company does not consolidate SLP II.
62

NMFC Senior Loan Program III LLC
NMFC Senior Loan Program III LLC ("SLP III") was formed as a Delaware limited liability company and commenced operations on April 25, 2018. SLP III is structured as a private joint venture investment fund between the Company and SkyKnight Income II, LLC (“SkyKnight II”) and operates under a limited liability company agreement (the "SLP III Agreement"). The purpose of the joint venture is to invest primarily in senior secured loans issued by portfolio companies within the Company's core industry verticals. These investments are typically broadly syndicated first lien loans. All investment decisions must be unanimously approved by the board of managers of SLP III, which has equal representation from the Company and SkyKnight II. SLP III has a five year investment period and will continue in existence until April 25, 2025. The investment period may be extended for up to one year pursuant to certain terms of the SLP III Agreement.
    SLP III is capitalized with equity contributions which are called from its members, on a pro-rata basis based on their equity commitments, as transactions are completed. Any decision by SLP III to call down on capital commitments requires approval by the board of managers of SLP III. As of March 31, 2021, the Company and SkyKnight II have committed $140,000 and $35,000, respectively, of equity to SLP III. As of March 31, 2021, he Company and SkyKnight II have contributed $130,000 and $32,500, respectively, of equity to SLP III. The Company’s investment in SLP III is disclosed on the Company’s Consolidated Schedule of Investments as of March 31, 2021 and December 31, 2020.
    On May 2, 2018, SLP III entered into its revolving credit facility with Citibank, N.A., which matures on May 2, 2023 and bears interest at a rate of LIBOR plus 1.70% per annum. Effective November 23, 2020, SLP III's revolving credit facility has a maximum borrowing capacity of $525,000. As of March 31, 2021 and December 31, 2020, SLP III had total investments with an aggregate fair value of approximately $666,648 and $609,961, respectively, and debt outstanding under its credit facility of $474,200 and $424,200, respectively. As of March 31, 2021 and December 31, 2020, none of SLP III's investments were on non-accrual. Additionally, as of March 31, 2021 and December 31, 2020, SLP III had unfunded commitments in the form of delayed draws of $15,093 and $7,838, respectively.
Below is a summary of SLP III's portfolio, along with a listing of the individual investments in SLP III's portfolio as of March 31, 2021 and December 31, 2020:
March 31, 2021December 31, 2020
First lien investments (1)$686,095 $626,985 
Weighted average interest rate on first lien investments (2)4.57 %4.72 %
Number of portfolio companies in SLP III71 69 
Largest portfolio company investment (1)$23,668 $23,735 
Total of five largest portfolio company investments (1)$98,902 $99,159 
(1)Reflects principal amount or par value of investment.
(2)Computed as the all in interest rate in effect on accruing investments divided by the total principal amount of investments.
63

    The following table is a listing of the individual investments in SLP III's portfolio as of March 31, 2021:
Portfolio Company and Type of InvestmentIndustryInterest Rate (1)Maturity Date Principal Amount or Par Value CostFair
Value (2)
Funded Investments - First lien
Access CIG, LLCBusiness Services 3.87% (L + 3.75%) 2/27/2025$865 $865 $860 
Advisor Group Holdings, Inc.Consumer Services 4.61% (L + 4.50%) 7/31/20269,875 9,835 9,880 
Affordable Care Holding Corp.Healthcare Services 5.75% (L + 4.75%) 10/24/20225,885 5,841 5,797 
AG Parent Holdings, LLCHealthcare Services 5.11% (L + 5.00%) 7/31/202612,344 12,294 12,297 
Ascensus Specialties LLCSpecialty Chemicals & Materials 4.87% (L + 4.75%) 9/24/20269,875 9,835 9,986 
Aston FinCo S.a.r.l. / Aston US Finco, LLCSoftware 4.36% (L + 4.25%) 10/9/20265,940 5,891 5,918 
Astra Acquisition Corp.Software 5.50% (L + 4.75%) 3/1/202716,490 16,415 16,614 
BCPE Empire Holdings, Inc.Distribution & Logistics 4.11% (L + 4.00%) 6/11/202610,842 10,756 10,801 
Bearcat Buyer, Inc.Healthcare Services 5.25% (L + 4.25%) 7/9/202619,604 19,527 19,604 
Bearcat Buyer, Inc.Healthcare Services 5.25% (L + 4.25%) 7/9/20264,064 4,046 4,064 
Bleriot US Bidco Inc.Federal Services 4.20% (L + 4.00%) 10/31/20264,950 4,907 4,944 
Bluefin Holding, LLCSoftware 4.11% (L + 4.00%) 9/4/20269,875 9,755 9,875 
Bracket Intermediate Holding Corp.Healthcare Services 4.49% (L + 4.25%) 9/5/202514,625 14,575 14,607 
Brave Parent Holdings, Inc.Software 4.11% (L + 4.00%) 4/18/202511,188 11,163 11,197 
Cano Health, LLCHealthcare Services 5.50% (L + 4.75%) 11/23/20276,291 6,231 6,298 
Cardinal Parent, Inc.Software 5.25% (L + 4.50%) 11/12/20277,037 6,935 7,077 
CentralSquare Technologies, LLCSoftware 3.95% (L + 3.75%) 8/29/202514,662 14,638 14,069 
Certara Holdco, Inc.Healthcare Information Technology 3.70% (L + 3.50%) 8/15/20241,242 1,245 1,242 
CHA Holdings, Inc.Business Services 5.50% (L + 4.50%) 4/10/2025975 975 912 
CommerceHub, Inc.Software 4.75% (L + 4.00%) 12/29/20275,819 5,790 5,833 
Confluent Health, LLCHealthcare Services 5.11% (L + 5.00%) 6/24/20264,387 4,345 4,387 
Covenant Surgical Partners, Inc.Healthcare Services 4.11% (L + 4.00%) 7/1/20269,851 9,774 9,642 
CRCI Longhorn Holdings, Inc.Business Services 3.61% (L + 3.50%) 8/8/202514,625 14,577 14,399 
Dealer Tire, LLCDistribution & Logistics 4.36% (L + 4.25%) 12/12/20259,875 9,855 9,904 
Dentalcorp Health Services ULC (fka Dentalcorp Perfect Smile ULC)Healthcare Services 4.75% (L + 3.75%) 6/6/202516,842 16,797 16,737 
DG Investment Intermediate Holdings 2, Inc.Business Services 4.50% (L + 3.75%) 3/31/20286,201 6,170 6,174 
DG Investment Intermediate Holdings 2, Inc.Business Services 4.50% (L + 3.75%) 3/31/2028500 500 498 
Dispatch Acquisition Holdings, LLCIndustrial Services 5.00% (L + 4.25%) 3/25/20284,179 4,137 4,171 
Drilling Info Holdings, Inc.Business Services 4.36% (L + 4.25%) 7/30/202518,529 18,467 18,251 
Edgewood Partners Holdings LLCBusiness Services 5.25% (L + 4.25%) 9/6/20247,337 7,289 7,264 
eResearchTechnology, Inc.Healthcare Services 5.50% (L + 4.50%) 2/4/20277,393 7,359 7,408 
EyeCare Partners, LLCHealthcare Services 3.86% (L + 3.75%) 2/18/202714,872 14,855 14,737 
Frontline Technologies Intermediate Holdings, LLCSoftware 6.75% (L + 5.75%) 9/18/20236,497 6,497 6,497 
Greenway Health, LLCSoftware 4.75% (L + 3.75%) 2/16/202414,482 14,488 13,849 
Heartland Dental, LLCHealthcare Services 3.61% (L + 3.50%) 4/30/202518,493 18,434 18,228 
Help/Systems Holdings, Inc.Software 5.75% (L + 4.75%) 11/19/202618,394 18,231 18,526 
Higginbotham Insurance Agency, Inc.Financial Services 6.50% (L + 5.75%) 11/25/20267,187 7,136 7,331 
Idera, Inc.Software 4.50% (L + 3.75%) 3/2/202816,085 16,070 16,004 
Kestra Advisor Services Holdings A, Inc.Business Services 4.36% (L + 4.25%) 6/3/202612,150 12,083 12,120 
LI Group Holdings, Inc.Software 4.50% (L + 3.75%) 3/11/20284,655 4,643 4,672 
LSCS Holdings, Inc.Healthcare Services 4.51% (L + 4.25%) 3/17/20252,621 2,606 2,594 
LSCS Holdings, Inc.Healthcare Services 4.51% (L + 4.25%) 3/17/2025676 673 670 
Maravai Intermediate Holdings, LLCSpecialty Chemicals & Materials 5.25% (L + 4.25%) 10/19/20274,114 4,075 4,132 
Market Track, LLCBusiness Services 5.25% (L + 4.25%) 6/5/20246,129 6,062 6,129 
MED ParentCo, LPHealthcare Services 4.36% (L + 4.25%) 8/31/202610,246 10,169 10,172 
MED ParentCo, LPHealthcare Services 4.36% (L + 4.25%) 8/31/20262,570 2,548 2,551 
Ministry Brands, LLCSoftware 5.00% (L + 4.00%) 12/2/20224,490 4,481 4,478 
Ministry Brands, LLCSoftware 5.00% (L + 4.00%) 12/2/2022869 867 866 
National Intergovernmental Purchasing Alliance CompanyBusiness Services 3.95% (L + 3.75%) 5/23/20258,679 8,676 8,657 
Navex Topco, Inc.Software 3.36% (L + 3.25%) 9/5/202518,162 18,038 18,048 
Newport Group Holdings II, Inc.Business Services 3.70% (L + 3.50%) 9/12/20254,875 4,859 4,851 
64

Portfolio Company and Type of InvestmentIndustryInterest Rate (1)Maturity Date Principal Amount or Par Value CostFair
Value (2)
Orion Advisor Solutions, Inc.Business Services 4.50% (L + 3.75%) 9/24/2027$5,237 $5,188 $5,234 
Outcomes Group Holdings, Inc.Healthcare Services 3.45% (L + 3.25%) 10/24/20253,392 3,386 3,358 
Pelican Products, Inc.Business Products 4.50% (L + 3.50%) 5/1/20254,863 4,855 4,817 
Peraton Corp.Federal Services 4.50% (L + 3.75%) 2/1/20284,529 4,507 4,531 
PetVet Care Centers, LLC (fka Pearl Intermediate Parent LLC)Consumer Services 4.25% (L + 3.50%) 2/14/20254,506 4,506 4,502 
Planview Parent, Inc.Software 4.75% (L + 4.00%) 12/17/20277,979 7,901 7,994 
Premise Health Holding Corp.Healthcare Services 3.70% (L + 3.50%) 7/10/202513,550 13,505 13,465 
Project Accelerate Parent, LLCBusiness Services 5.25% (L + 4.25%) 1/2/20259,798 9,763 9,447 
Project Boost Purchaser, LLCBusiness Services 5.00% (L + 4.25%) 6/1/20261,990 1,971 1,991 
Project Ruby Ultimate Parent Corp. (Mediware)Healthcare I.T. 4.00% (L + 3.25%) 3/10/202814,000 13,930 13,959 
Quest Software US Holdings Inc.Software 4.46% (L + 4.25%) 5/16/202514,662 14,616 14,678 
RealPage, Inc.Business Services 3.75% (L + 3.25%) 4/24/202814,000 13,965 13,950 
Sierra Enterprises, LLCFood & Beverage 5.00% (L + 4.00%) 11/11/20242,425 2,423 2,395 
Sovos Brands Intermediate, Inc.Food & Beverage 4.98% (L + 4.75%) 11/20/20253,582 3,573 3,600 
Spring Education Group, Inc. (fka SSH Group Holdings, Inc.)Education 4.45% (L + 4.25%) 7/30/202512,152 12,131 11,632 
Storable, IncSoftware 3.75% (L + 3.25%) 2/26/20283,862 3,852 3,833 
Symplr Software, Inc.(fka Caliper Software, Inc.)Healthcare I.T. 5.25% (L + 4.50%) 12/22/202716,000 15,854 16,072 
Syndigo LLCSoftware 5.25% (L + 4.50%) 12/15/202715,000 14,891 14,888 
TIBCO Software Inc.Software 3.86% (L + 3.75%) 6/30/20267,635 7,618 7,568 
Unified Women’s Healthcare, LPHealthcare Services 5.00% (L + 4.25%) 12/20/20279,975 9,900 10,008 
Waystar Technologies, Inc.Healthcare Services 4.11% (L + 4.00%) 10/22/20264,097 4,088 4,107 
Wirepath LLCDistribution & Logistics 4.20% (L + 4.00%) 8/5/202417,083 17,083 16,827 
WP CityMD Bidco LLCHealthcare Services 4.50% (L + 3.75%) 8/13/202619,818 19,658 19,817 
VT Topco, Inc.Business Services 3.61% (L + 3.50%) 8/1/20252,788 2,788 2,754 
YI, LLCHealthcare Services 5.00% (L + 4.00%) 11/7/20249,666 9,660 9,400 
Total Funded Investments$671,002 $667,892 $666,649 
Unfunded Investments - First lien
Cano Health, LLCHealthcare Services11/23/2021$2,300 $(23)$
Covenant Surgical Partners, Inc.Healthcare Services7/1/20212,000 (20)(43)
DG Investment Intermediate Holdings 2, Inc.Business Services3/31/2023799 — (3)
Higginbotham Insurance Agency, Inc.Financial Services11/25/20222,023 (15)40 
Peraton Corp.Federal Services2/1/20287,971 (40)
Total Unfunded Investments$15,093 $(98)$(1)
Total Investments$686,095 $667,794 $666,648 
(1)All interest is payable in cash unless otherwise indicated. A majority of the variable rate debt investments bear interest at a rate that may be determined by reference to the LIBOR (L), the Prime Rate (P) and the alternative base rate (Base). For each investment, the current interest rate provided reflects the rate in effect as of March 31, 2021.
(2)Represents the fair value in accordance with ASC 820. The Company's board of directors does not determine the fair value of the investments held by SLP III.
65

    The following table is a listing of the individual investments in SLP III's portfolio as of December 31, 2020:
Portfolio Company and Type of InvestmentIndustryInterest Rate (1)Maturity Date Principal Amount or Par Value CostFair
Value (2)
Funded Investments - First lien
Access CIG, LLCBusiness Services3.98% (L + 3.75%)2/27/2025$868 $868 $861 
Advisor Group Holdings, Inc.Consumer Services5.15% (L + 5.00%)7/31/20264,950 4,909 4,928 
Affordable Care Holding Corp.Healthcare Services5.75% (L + 4.75%)10/24/20225,901 5,850 5,827 
AG Parent Holdings, LLCHealthcare Services5.15% (L + 5.00%)7/31/202612,375 12,323 12,251 
Ascensus Specialties LLCSpecialty Chemicals & Materials4.90% (L + 4.75%)9/24/20269,900 9,858 9,931 
Aston FinCo S.a.r.l. / Aston US Finco, LLCSoftware4.40% (L + 4.25%)10/9/20265,955 5,904 5,900 
Astra Acquisition Corp.Software6.50% (L + 5.50%)3/1/202711,490 11,412 11,605 
BCPE Empire Holdings, Inc.Distribution & Logistics4.15% (L + 4.00%)6/11/202610,869 10,780 10,801 
Bearcat Buyer, Inc.Healthcare Services5.25% (L + 4.25%)7/9/202619,654 19,573 19,654 
Bearcat Buyer, Inc.Healthcare Services5.25% (L + 4.25%)7/9/20264,081 4,062 4,081 
Bleriot US Bidco Inc.Federal Services5.00% (L + 4.75%)10/31/20264,292 4,254 4,292 
Bleriot US Bidco Inc.Federal Services5.00% (L + 4.75%)10/31/2026671 665 671 
Bluefin Holding, LLCSoftware4.15% (L + 4.00%)9/4/20269,900 9,775 9,900 
Bracket Intermediate Holding Corp.Healthcare Services4.48% (L + 4.25%)9/5/202514,663 14,610 14,516 
Brave Parent Holdings, Inc.Software4.15% (L + 4.00%)4/18/202511,217 11,190 11,147 
Cano Health, LLCHealthcare Services5.50% (L + 4.75%)11/23/20276,308 6,244 6,244 
Cardinal Parent, Inc.Software5.25% (L + 4.50%)11/12/20277,038 6,932 6,967 
CentralSquare Technologies, LLCSoftware4.00% (L + 3.75%)8/29/202514,700 14,674 13,745 
Certara Holdco, Inc.Healthcare I.T.3.75% (L + 3.50%)8/15/20241,246 1,248 1,247 
CHA Holdings, Inc.Business Services5.50% (L + 4.50%)4/10/2025977 977 914 
CommerceHub, Inc.Software4.75% (L + 4.00%)12/29/20275,833 5,804 5,833 
Confluent Health, LLCHealthcare Services5.15% (L + 5.00%)6/24/20264,398 4,354 4,348 
Covenant Surgical Partners, Inc.Healthcare Services4.15% (L + 4.00%)7/1/20269,876 9,795 9,678 
CRCI Longhorn Holdings, Inc.Business Services3.65% (L + 3.50%)8/8/202514,663 14,611 14,498 
Dealer Tire, LLCDistribution & Logistics4.40% (L + 4.25%)12/12/20259,900 9,879 9,859 
Dentalcorp Health Services ULC (fka Dentalcorp Perfect Smile ULC)Healthcare Services4.75% (L + 3.75%)6/6/202514,636 14,611 14,421 
Drilling Info Holdings, Inc.Business Services4.40% (L + 4.25%)7/30/202518,576 18,511 18,035 
Edgewood Partners Holdings LLCBusiness Services5.25% (L + 4.25%)9/6/20247,356 7,304 7,301 
eResearchTechnology, Inc.Healthcare Services5.50% (L + 4.50%)2/4/20273,911 3,876 3,883 
EyeCare Partners, LLCHealthcare Services3.90% (L + 3.75%)2/18/202712,071 12,057 11,796 
EyeCare Partners, LLCHealthcare Services3.90% (L + 3.75%)2/18/20272,838 2,834 2,773 
Fastlane Parent Company, Inc.Distribution & Logistics4.65% (L + 4.50%)2/4/20263,439 3,386 3,419 
Frontline Technologies Intermediate Holdings, LLCSoftware6.75% (L + 5.75%)9/18/20236,513 6,513 6,513 
Greenway Health, LLCSoftware4.75% (L + 3.75%)2/16/202414,520 14,527 13,322 
Heartland Dental, LLCHealthcare Services3.65% (L + 3.50%)4/30/202518,540 18,478 18,104 
HS Purchaser, LLC / Help/Systems Holdings, Inc.Software5.75% (L + 4.75%)11/19/202618,440 18,270 18,440 
Higginbotham Insurance Agency, Inc.Financial Services6.50% (L + 5.75%)11/25/20267,187 7,134 7,331 
Idera, Inc.Software5.00% (L + 4.00%)6/28/20249,435 9,406 9,435 
Institutional Shareholder Services Inc.Business Services4.75% (L + 4.50%)3/5/2026983 975 971 
Kestra Advisor Services Holdings A, Inc.Business Services4.40% (L + 4.25%)6/3/20269,381 9,318 9,241 
LSCS Holdings, Inc.Healthcare Services4.51% (L + 4.25%)3/17/20252,627 2,612 2,575 
LSCS Holdings, Inc.Healthcare Services4.51% (L + 4.25%)3/17/2025678 674 665 
Maravai Intermediate Holdings, LLCSpecialty Chemicals & Materials5.25% (L + 4.25%)10/19/20274,125 4,085 4,148 
Market Track, LLCBusiness Services5.25% (L + 4.25%)6/5/20244,729 4,725 4,645 
Mavis Tire Express Services Corp.Retail5.00% (L + 4.00%)3/20/20254,828 4,733 4,846 
MED ParentCo, LPHealthcare Services4.40% (L + 4.25%)8/31/202610,272 10,191 10,148 
MED ParentCo, LPHealthcare Services4.40% (L + 4.25%)8/31/20262,576 2,554 2,545 
Ministry Brands, LLCSoftware5.00% (L + 4.00%)12/2/20224,502 4,492 4,480 
Ministry Brands, LLCSoftware5.00% (L + 4.00%)12/2/2022871 869 867 
National Intergovernmental Purchasing Alliance CompanyBusiness Services4.00% (L + 3.75%)5/23/20258,701 8,698 8,658 
National Mentor Holdings, Inc. (aka Civitas Solutions, Inc.)Healthcare Services4.43% (L + 4.25%)3/9/20268,887 8,887 8,897 
66

Portfolio Company and Type of InvestmentIndustryInterest Rate (1)Maturity Date Principal Amount or Par Value CostFair
Value (2)
National Mentor Holdings, Inc. (aka Civitas Solutions, Inc.)Healthcare Services4.51% (L + 4.25%)3/9/2026$398 $398 $398 
Navex Topco, Inc.Software3.40% (L + 3.25%)9/5/202518,208 18,079 17,929 
Navicure, Inc.Healthcare Services4.75% (L + 4.00%)10/22/20264,107 4,097 4,110 
Newport Group Holdings II, Inc.Business Services3.75% (L + 3.50%)9/12/20254,888 4,870 4,851 
Orion Advisor Solutions, Inc.Business Services5.00% (L + 4.00%)9/24/20275,237 5,186 5,260 
Outcomes Group Holdings, Inc.Healthcare Services3.50% (L + 3.25%)10/24/20253,400 3,394 3,349 
Pelican Products, Inc.Business Products4.50% (L + 3.50%)5/1/20254,875 4,867 4,796 
Peraton Corp. (fka MHVC Acquisition Corp.)Federal Services6.25% (L + 5.25%)4/29/202415,272 15,225 15,310 
Planview Parent, Inc.Software4.75% (L + 4.00%)12/17/20276,484 6,419 6,496 
Premise Health Holding Corp.Healthcare Services3.75% (L + 3.50%)7/10/202513,583 13,538 13,279 
Project Accelerate Parent, LLCBusiness Services5.25% (L + 4.25%)1/2/20259,822 9,786 8,939 
Project Boost Purchaser, LLCBusiness Services5.00% (L + 4.25%)6/1/20261,995 1,975 2,002 
Quest Software US Holdings Inc.Software4.46% (L + 4.25%)5/16/202514,700 14,650 14,480 
Ryan Specialty Group, LLCBusiness Services4.00% (L + 3.25%)9/1/20273,491 3,441 3,491 
Sierra Enterprises, LLCFood & Beverage5.00% (L + 4.00%)11/11/20242,431 2,429 2,393 
Sovos Brands Intermediate, Inc.Food & Beverage4.96% (L + 4.75%)11/20/20253,591 3,582 3,609 
Spring Education Group, Inc. (fka SSH Group Holdings, Inc.)Education4.50% (L + 4.25%)7/30/202512,183 12,161 11,665 
Symplr Software, Inc.(fka Caliper Software, Inc.)Healthcare I.T.5.25% (L + 4.50%)12/22/202710,000 9,850 9,913 
Syndigo LLCSoftware5.25% (L + 4.50%)12/15/202715,000 14,888 14,888 
TIBCO Software Inc.Software3.90% (L + 3.75%)6/30/20267,654 7,637 7,572 
Unified Women’s Healthcare, LPHealthcare Services5.00% (L + 4.25%)12/20/202710,000 9,923 9,975 
Wirepath LLCDistribution & Logistics4.25% (L + 4.00%)8/5/202417,127 17,127 16,527 
WP CityMD Bidco LLCHealthcare Services5.50% (L + 4.50%)8/13/202619,868 19,701 19,914 
VT Topco, Inc.Business Services3.65% (L + 3.50%)8/1/20252,795 2,795 2,763 
YI, LLCHealthcare Services5.00% (L + 4.00%)11/7/20249,691 9,685 8,915 
Total Funded Investments$619,147 $615,974 $609,981 
Unfunded Investments - First lien
Cano Health, LLCHealthcare Services11/23/2021$2,300 $(23)$(23)
Covenant Surgical Partners, Inc.Healthcare Services7/1/20212,000 (20)(40)
Higginbotham Insurance Agency, Inc.Financial Services11/25/20222,023 (15)40 
Planview Parent, Inc.Software3/31/20211,515 — 
Total Unfunded Investments$7,838 $(58)$(20)
Total Investments$626,985 $615,916 $609,961 
(1)All interest is payable in cash unless otherwise indicated. A majority of the variable rate debt investments bear interest at a rate that may be determined by reference to the LIBOR (L), the Prime Rate (P) and the alternative base rate (Base). For each investment, the current interest rate provided reflects the rate in effect as of December 31, 2020.
(2)Represents the fair value in accordance with ASC 820. The Company's board of directors does not determine the fair value of the investments held by SLP III.


67

    Below is certain summarized financial information for SLP III as of March 31, 2021 and December 31, 2020 and for the three months ended March 31, 2021 and March 31, 2020:
Selected Balance Sheet Information:March 31, 2021December 31, 2020
Investments at fair value (cost of $667,794 and $615,916)$666,648 $609,961 
Cash and other assets20,507 10,176 
Receivable from unsettled securities sold4,828 — 
Total assets$691,983 $620,137 
Credit facility$474,200 $424,200 
Deferred financing costs(2,210)(2,471)
Payable for unsettled securities purchased50,333 47,192 
Distribution payable5,658 3,800 
Other liabilities2,505 2,501 
Total liabilities530,486 475,222 
Members' capital$161,497 $144,915 
Total liabilities and members' capital$691,983 $620,137 
Selected Statement of Operations Information:Three Months Ended
March 31, 2021March 31, 2020
Interest income$7,371 $7,407 
Other income103 181 
Total investment income7,474 7,588 
Interest and other financing expenses2,584 3,696 
Other expenses171 157 
Total expenses2,755 3,853 
Net investment income4,719 3,735 
Net realized gains (losses) on investments212 (2)
Net change in unrealized appreciation (depreciation) of investments4,809 (63,348)
Net increase (decrease) in members' capital$9,740 $(59,615)
For the three months ended March 31, 2021 and March 31, 2020, the Company earned approximately $4,527 and $2,874, respectively, of dividend income related to SLP III, which is included in dividend income. As of March 31, 2021 and December 31, 2020, approximately $4,527 and $3,040, respectively, of dividend income related to SLP III was included in interest and dividend receivable.
    The Company has determined that SLP III is an investment company under ASC 946; however, in accordance with such guidance the Company will generally not consolidate its investment in a company other than a wholly-owned investment company subsidiary. Furthermore, ASC 810 concludes that in a joint venture where both members have equal decision making authority, it is not appropriate for one member to consolidate the joint venture since neither has control. Accordingly, the Company does not consolidate SLP III.
Unconsolidated Significant Subsidiaries
    In accordance with Regulation S-X Rule 10-01(b)(1), the Company evaluates its unconsolidated controlled portfolio companies as significant subsidiaries under this rule. As of March 31, 2021, the Company did not have any significant unconsolidated subsidiaries under Regulation S-X Rule 10-01(b)(1).

68

Investment Risk Factors
    First and second lien debt that the Company invests in is almost entirely rated below investment grade or may be unrated. Debt investments rated below investment grade are often referred to as “leveraged loans”, “high yield” or “junk” debt investments, and may be considered “high risk” compared to debt investments that are rated investment grade. These debt investments are considered speculative because of the credit risk of the issuers. Such issuers are considered more likely than investment grade issuers to default on their payments of interest and principal, and such risk of default could reduce the net asset value and income distributions of the Company. In addition, some of the Company’s debt investments will not fully amortize during their lifetime, which could result in a loss or a substantial amount of unpaid principal and interest due upon maturity. First and second lien debt may also lose significant market value before a default occurs. Furthermore, an active trading market may not exist for these first and second lien debt investments. This illiquidity may make it more difficult to value the debt.
Subordinated debt is generally subject to similar risks as those associated with first and second lien debt, except that such debt is subordinated in payment and/or lower in lien priority. Subordinated debt is subject to the additional risk that the cash flow of the borrower and the property securing the debt, if any, may be insufficient to meet scheduled payments after giving effect to the senior secured and unsecured obligations of the borrower.
The Company may directly invest in the equity of private companies or, in some cases, equity investments could be made in connection with a debt investment. Equity investments may or may not fluctuate in value, resulting in recognized realized gains or losses upon disposition.
The Company’s operating results and portfolio companies may be negatively impacted by the COVID-19 pandemic. While several countries, as well as certain states, counties and cities in the United States, have relaxed initial public health restrictions with the view to partially or fully reopening their economies, many cities have since experienced a surge in the reported number of cases, hospitalizations and deaths related to the COVID-19 pandemic. These surges have led to the re-introduction of such restrictions and business shutdowns in certain states in the United States and globally and could continue to lead to the re-introduction of such restrictions elsewhere. Health advisors warn that recurring COVID-19 outbreaks will continue if reopening is pursued too soon or in the wrong manner, which may lead to the re-introduction or continuation of certain public health restrictions (such as instituting quarantines, prohibitions on travel and the closure of offices, businesses, schools, retail stores and other public venues). Additionally, travelers from the United States are restricted from visiting many countries including countries in Europe, Asia, Africa and South America. These continued travel restrictions may prolong the global economic downturn. In addition, although the Federal Food and Drug Administration authorized vaccines beginning in December 2020 and a significant portion of the U.S. population have been vaccinated, and it remains unclear how quickly the vaccines will continue to be distributed nationwide and globally, or when “herd immunity” will be achieved and the restrictions that were imposed to slow the spread of the virus will be lifted entirely. Any delay in distributing the vaccines could lead people to continue to self-isolate and not participate in the economy at pre-pandemic levels for a prolonged period of time. Even after the COVID-19 pandemic subsides, the U.S. economy and most other major global economies may continue to experience a recession, and we anticipate our business and operations could be materially adversely affected by a prolonged recession in the United States and other major markets.
This outbreak is having, and any future outbreaks could have, an adverse impact on the markets and the economy in general, which could have a material adverse impact on, among other things, the ability of lenders to originate loans, the volume and type of loans originated, and the volume and type of amendments and waivers granted to borrowers and remedial actions taken in the event of a borrower default, each of which could negatively impact the amount and quality of loans available for investment by the Company and returns to the Company, among other things. As of the date of this quarterly report on Form 10-Q, it is impossible to determine the scope of this outbreak, or any future outbreaks, how long any such outbreak, market disruption or uncertainties may last, the effect any governmental actions will have or the full potential impact on the Company and our portfolio companies. Any potential impact to our results of operations will depend to a large extent on future developments and new information that could emerge regarding the duration and severity of COVID-19 and the actions taken by authorities and other entities to contain COVID-19 or treat its impact, all of which are beyond our control. These potential impacts, while uncertain, could adversely affect our and our portfolio companies’ operating results.

Note 4. Fair Value
Fair value is the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC 820 establishes a fair value hierarchy that prioritizes and ranks the inputs to valuation techniques used in measuring investments at fair value. The hierarchy classifies the inputs used in measuring fair value into three levels as follows:
Level I—Quoted prices (unadjusted) are available in active markets for identical investments and the Company has the ability to access such quotes as of the reporting date. The type of investments which would generally be included in Level I
69

include active exchange-traded equity securities and exchange-traded derivatives. As required by ASC 820, the Company, to the extent that it holds such investments, does not adjust the quoted price for these investments, even in situations where the Company holds a large position and a sale could reasonably impact the quoted price.
Level II—Pricing inputs are observable for the investments, either directly or indirectly, as of the reporting date, but are not the same as those used in Level I. Level II inputs include the following:
Quoted prices for similar assets or liabilities in active markets;
Quoted prices for identical or similar assets or liabilities in non-active markets (examples include corporate and municipal bonds, which trade infrequently);
Pricing models whose inputs are observable for substantially the full term of the asset or liability (examples include most over-the-counter derivatives, including foreign exchange forward contracts); and
Pricing models whose inputs are derived principally from or corroborated by observable market data through correlation or other means for substantially the full term of the asset or liability.
Level III—Pricing inputs are unobservable for the investment and include situations where there is little, if any, market activity for the investment.
The inputs used to measure fair value may fall into different levels. In all instances when the inputs fall within different levels of the hierarchy, the level within which the fair value measurement is categorized is based on the lowest level of input that is significant to the fair value measurement in its entirety. As such, a Level III fair value measurement may include inputs that are both observable and unobservable. Gains and losses for such assets categorized within the Level III table below may include changes in fair value that are attributable to both observable inputs and unobservable inputs.
The inputs into the determination of fair value require significant judgment or estimation by management and consideration of factors specific to each investment. A review of the fair value hierarchy classifications is conducted on a quarterly basis. Changes in the observability of valuation inputs may result in the transfer of certain investments within the fair value hierarchy from period to period.
The following table summarizes the levels in the fair value hierarchy that the Company’s portfolio investments fall into as of March 31, 2021:
 TotalLevel ILevel IILevel III
First lien$1,576,600 $— $76,750 $1,499,850 
Second lien696,209 — 301,291 394,918 
Subordinated37,295 — — 37,295 
Equity and other708,508 — — 708,508 
Total investments$3,018,612 $— $378,041 $2,640,571 

The following table summarizes the levels in the fair value hierarchy that the Company’s portfolio investments fall into as of December 31, 2020:
 TotalLevel ILevel IILevel III
First lien$1,576,217 $— $92,850 $1,483,367 
Second lien692,828 — 122,795 570,033 
Subordinated36,939 — — 36,939 
Equity and other647,518 — — 647,518 
Total investments$2,953,502 $— $215,645 $2,737,857 


70

The following table summarizes the changes in fair value of Level III portfolio investments for the three months ended March 31, 2021, as well as the portion of appreciation (depreciation) included in income attributable to unrealized appreciation (depreciation) related to those assets and liabilities still held by the Company at March 31, 2021:
 TotalFirst LienSecond LienSubordinatedEquity and
other
Fair value, December 31, 2020$2,737,857 $1,483,367 $570,033 $36,939 $647,518 
Total gains or losses included in earnings: 
Net realized (losses) gains on investments(12,070)142 (5,150)(7,064)
Net change in unrealized appreciation34,754 7,803 3,442 5,061 18,448 
Purchases, including capitalized PIK and revolver fundings221,870 125,397 46,422 445 49,606 
Proceeds from sales and paydowns of investments(184,933)(111,415)(73,518)— — 
Transfers into Level III33,442 26,782 6,660 — — 
Transfers out of Level III(1)(190,349)(32,226)(158,123)— — 
Fair Value, March 31, 2021$2,640,571 $1,499,850 $394,918 $37,295 $708,508 
Unrealized appreciation (depreciation) for the period relating to those Level III assets that were still held by the Company at the end of the period:$21,562 $7,027 $3,240 $(89)$11,384 
(1)As of March 31, 2021, portfolio investments were transferred into Level III from Level II and out of Level III into Level II at fair value as of the beginning of the period in which the reclassification occurred.

    The following table summarizes the changes in fair value of Level III portfolio investments for the three months ended March 31, 2020, as well as the portion of appreciation (depreciation) included in income attributable to unrealized appreciation (depreciation) related to those assets and liabilities still held by the Company at March 31, 2020:
 TotalFirst LienSecond LienSubordinatedEquity and
other
Fair value, December 31, 2019$2,506,741 $1,538,423 $419,391 $45,904 $503,023 
Total gains or losses included in earnings:     
Net realized (losses) gains on investments(102)(185)— — 83 
Net change in unrealized depreciation(181,399)(86,236)(31,724)(4,888)(58,551)
Purchases, including capitalized PIK and revolver fundings220,476 195,654 10,497 1,036 13,289 
Proceeds from sales and paydowns of investments(97,561)(57,470)(40,091)— — 
Transfers into Level III(1)434,918 148,869 286,049 — — 
Transfers out of Level III(1)(14,924)— (14,924)— — 
Fair Value, March 31, 2020$2,868,149 $1,739,055 $629,198 $42,052 $457,844 
Unrealized depreciation for the period relating to those Level III assets that were still held by the Company at the end of the period:$(181,745)$(86,312)$(31,994)$(4,888)$(58,551)
(1)As of March 31, 2020, portfolio investments were transferred into Level III from Level II and out of Level III into Level II at fair value as of the beginning of the period in which the reclassification occurred.

Except as noted in the tables above, there were no other transfers in or out of Level I, II, or III during the three months ended March 31, 2021 and March 31, 2020. Transfers into Level III occur as quotations obtained through pricing services are deemed not representative of fair value as of the balance sheet date and such assets are internally valued. As quotations obtained through pricing services are substantiated through additional market sources, investments are transferred out of Level III. In addition, transfers out of Level III and transfers into Level III occur based on the increase or decrease in the availability of certain observable inputs.
The Company invests in revolving credit facilities. These investments are categorized as Level III investments as these assets are not actively traded and their fair values are often implied by the term loans of the respective portfolio companies.
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The Company generally uses the following framework when determining the fair value of investments where there are little, if any, market activity or observable pricing inputs. The Company typically determines the fair value of its performing debt investments utilizing an income approach. Additional consideration is given using a market based approach, as well as reviewing the overall underlying portfolio company’s performance and associated financial risks. The following outlines additional details on the approaches considered:
Company Performance, Financial Review, and Analysis:  Prior to investment, as part of its due diligence process, the Company evaluates the overall performance and financial stability of the portfolio company. Post investment, the Company analyzes each portfolio company’s current operating performance and relevant financial trends versus prior year and budgeted results, including, but not limited to, factors affecting its revenue and earnings before interest, taxes, depreciation, and amortization (“EBITDA”) growth, margin trends, liquidity position, covenant compliance and changes to its capital structure. The Company also attempts to identify and subsequently track any developments at the portfolio company, within its customer or vendor base or within the industry or the macroeconomic environment, generally, that may alter any material element of its original investment thesis. This analysis is specific to each portfolio company. The Company leverages the knowledge gained from its original due diligence process, augmented by this subsequent monitoring, to continually refine its outlook for each of its portfolio companies and ultimately form the valuation of its investment in each portfolio company. When an external event such as a purchase transaction, public offering or subsequent sale occurs, the Company will consider the pricing indicated by the external event to corroborate the private valuation.
    For debt investments, the Company may employ the Market Based Approach (as described below) to assess the total enterprise value of the portfolio company, in order to evaluate the enterprise value coverage of the Company’s debt investment. For equity investments or in cases where the Market Based Approach implies a lack of enterprise value coverage for the debt investment, the Company may additionally employ a discounted cash flow analysis based on the free cash flows of the portfolio company to assess the total enterprise value. After enterprise value coverage is demonstrated for the Company’s debt investments through the method(s) above, the Income Based Approach (as described below) may be employed to estimate the fair value of the investment.
Market Based Approach:  The Company may estimate the total enterprise value of each portfolio company by utilizing market value cash flow (EBITDA) multiples of publicly traded comparable companies and comparable transactions. The Company considers numerous factors when selecting the appropriate companies whose trading multiples are used to value its portfolio companies. These factors include, but are not limited to, the type of organization, similarity to the business being valued, and relevant risk factors, as well as size, profitability and growth expectations. The Company may apply an average of various relevant comparable company EBITDA multiples to the portfolio company’s latest twelve month (“LTM”) EBITDA or projected EBITDA to calculate the enterprise value of the portfolio company. Significant increases or decreases in the EBITDA multiple will result in an increase or decrease in enterprise value, which may result in an increase or decrease in the fair value estimate of the investment. In applying the market based approach as of March 31, 2021 and December 31, 2020, the Company used the relevant EBITDA multiple ranges set forth in the table below to determine the enterprise value of its portfolio companies. The Company believes these were reasonable ranges in light of current comparable company trading levels and the specific portfolio companies involved.
Income Based Approach: The Company also may use a discounted cash flow analysis to estimate the fair value of the investment. Projected cash flows represent the relevant security’s contractual interest, fee and principal payments plus the assumption of full principal recovery at the investment’s expected maturity date. These cash flows are discounted at a rate established utilizing a combination of a yield calibration approach and a comparable investment approach. The yield calibration approach incorporates changes in the credit quality (as measured by relevant statistics) of the portfolio company, as compared to changes in the yield associated with comparable credit quality market indices, between the date of origination and the valuation date. The comparable investment approach utilizes an average yield-to maturity of a selected set of high-quality, liquid investments to determine a comparable investment discount rate. Significant increases or decreases in the discount rate would result in a decrease or increase in the fair value measurement. In applying the income based approach as of March 31, 2021 and December 31, 2020, the Company used the discount ranges set forth in the table below to value investments in its portfolio companies.

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The unobservable inputs used in the fair value measurement of the Company's Level III investments as of March 31, 2021 were as follows:
   Range
TypeFair Value as of March 31, 2021ApproachUnobservable InputLowHighWeighted
Average
First lien$1,356,548 Market & income approachEBITDA multiple5.0x35.0x14.8x
Revenue multiple5.0x11.0x7.1x
 Discount rate4.8 %18.4 %7.8 %
99,862 Market quoteBroker quoteN/AN/AN/A
43,440 OtherN/A(1)N/AN/AN/A
Second lien279,853 Market & income approachEBITDA multiple7.5x32.0x15.0x
 Discount rate6.2 %24.7 %10.3 %
94,803 Market quoteBroker quoteN/AN/AN/A
20,262 OtherN/A(1)N/AN/AN/A
Subordinated37,295 Market & income approachEBITDA multiple8.0x13.5x10.0x
 Discount rate11.5 %17.3 %13.6 %
Equity and other708,350 Market & income approachEBITDA multiple5.0x19.5x11.4x
 Discount rate5.8 %35.2 %11.2 %
158 OtherN/A(1)N/AN/AN/A
$2,640,571      
 
(1)Fair value was determined based on transaction pricing or recent acquisition or sale as the best measure of fair value with no material changes in operations of the related portfolio company since the transaction date.


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The unobservable inputs used in the fair value measurement of the Company's Level III investments as of December 31, 2020 were as follows:
   Range
TypeFair Value as of December 31, 2020ApproachUnobservable InputLowHighWeighted
Average
First lien$1,401,169 Market & income approachEBITDA multiple5.0x35.0x14.5x
 Revenue multiple4.0x11.0x6.2x
Discount rate4.4 %18.6 %7.6 %
82,198 Market quoteBroker quoteN/AN/AN/A
Second lien474,956 Market & income approachEBITDA multiple6.5x32.0x14.9x
Discount rate6.9 %22.6 %9.5 %
52,374 Market quoteBroker quoteN/AN/AN/A
42,703 OtherN/A(1)N/AN/AN/A
Subordinated36,939 Market & income approachEBITDA multiple8.0x13.5x10.0x
 Discount rate11.7 %13.6 %12.5 %
Equity and other647,360 Market & income approach(2)EBITDA multiple5.0x19.5x11.9x
Discount rate5.8 %40.9 %11.6 %
158 OtherN/A(1)N/AN/AN/A
$2,737,857      

(1)Fair value was determined based on transaction pricing or recent acquisition or sale as the best measure of fair value with no material changes in operations of the related portfolio company since the transaction date.
(2)Since December 31, 2019, there were changes in valuation techniques within Level III that did not have a material impact on the valuation of these investments. Certain investments that were previously valued using Black Scholes analysis are now valued based on Market & income approach as these methods are better indicators of the fair value measurement.
Based on a comparison to similar BDC credit facilities, the terms and conditions of the Holdings Credit Facility, the NMFC Credit Facility and the DB Credit Facility are representative of market. The carrying values of the Holdings Credit Facility, NMFC Credit Facility and DB Credit Facility approximate fair value as of March 31, 2021, as the facilities are continually monitored and examined by both the borrower and the lender and are considered Level III. See Note 7. Borrowings, for details. The carrying value of the SBA-guaranteed debentures, the 2017A Unsecured Notes, the 2018A Unsecured Notes, the 2018B Unsecured Notes, the 2019A Unsecured Notes and the 2021A Unsecured Notes approximate fair value as of March 31, 2021 based on a comparison of market interest rates for the Company’s borrowings and similar entities and are considered Level III. The fair value of the 2018 Convertible Notes as of March 31, 2021 was $210,819 which was based on quoted prices and considered Level II. See Note 7. Borrowings, for details. The carrying value of the collateralized agreement approximates fair value as of March 31, 2021 and is considered Level III. The fair value of other financial assets and liabilities approximates their carrying value based on the short-term nature of these items.
Fair value risk factors—The Company seeks investment opportunities that offer the possibility of attaining substantial capital appreciation. Certain events particular to each industry in which the Company’s portfolio companies conduct their operations, as well as general economic, political and public health conditions (including the COVID-19 pandemic), may have a significant negative impact on the operations and profitability of the Company’s investments and/or on the fair value of the Company’s investments. The Company’s investments are subject to the risk of non-payment of scheduled interest or principal, resulting in a reduction in income to the Company and their corresponding fair valuations. Also, there may be risk associated with the concentration of investments in one geographic region or in certain industries. These events are beyond the control of the Company and cannot be predicted. Furthermore, the ability to liquidate investments and realize value is subject to uncertainties.
Note 5. Agreements
The Company entered into an investment advisory and management agreement (the “Investment Management Agreement”) with the Investment Adviser which was most recently re-approved by the Company's board of directors on February 17, 2021 at a virtual meeting. Our board of directors held such meeting by virtual means in reliance on relief provided
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by the U.S. Securities and Exchange Commission (the "SEC") in response to the COVID-19 pandemic. Under the Investment Management Agreement, the Investment Adviser manages the day-to-day operations of, and provides investment advisory services to, the Company. For providing these services, the Investment Adviser receives a fee from the Company, consisting of two components—a base management fee and an incentive fee.
Pursuant to the Investment Management Agreement, the base management fee is calculated at an annual rate of 1.75% of the Company’s gross assets, which equals the Company’s total assets on the Consolidated Statements of Assets and Liabilities, less (i) the borrowings under the New Mountain Finance SPV Funding, L.L.C. Loan and Security Agreement, as amended and restated, dated October 27, 2010 (the "SLF Credit Facility") and (ii) cash and cash equivalents. The base management fee is payable quarterly in arrears, and is calculated based on the average value of the Company’s gross assets, which equals the Company’s total assets, as determined in accordance with GAAP, less the borrowings under the SLF Credit Facility and cash and cash equivalents at the end of each of the two most recently completed calendar quarters, and appropriately adjusted on a pro rata basis for any equity capital raises or repurchases during the current calendar quarter. The Company has not invested, and currently is not invested, in derivatives. To the extent the Company invests in derivatives in the future, the Company will use the actual value of the derivatives, as reported on the Consolidated Statements of Assets and Liabilities, for purposes of calculating its base management fee.
Since the IPO, the base management fee calculation has deducted the borrowings under the SLF Credit Facility. The SLF Credit Facility had historically consisted of primarily lower yielding assets at higher advance rates. As part of an amendment to the Company’s existing credit facilities with Wells Fargo Bank, National Association, the SLF Credit Facility merged with the NMF Holdings Loan and Security Agreement, as amended and restated, dated May 19, 2011, and formed the Holdings Credit Facility on December 18, 2014, as amended and restated on October 25, 2017. See Note 7. Borrowings for details. The amendment merged the credit facilities and combined the amount of borrowings previously available. Post credit facility merger and to be consistent with the methodology since the IPO, the Investment Adviser continued to waive management fees on the leverage associated with those assets held under revolving credit facilities that share the same underlying yield characteristics with investments leveraged under the legacy SLF Credit Facility. Effective as of and for the quarter ended March 31, 2021 through the quarter ending December 31, 2022, the Investment Adviser has entered into a fee waiver agreement pursuant to which the Investment Adviser will waive base management fees in order to reach a target base management fee of 1.25% on gross assets (the “Reduced Base Management Fee”) as opposed to the Company’s current base management fee of 1.75% on gross assets less the borrowings under the SLF Credit Facility and less cash and cash equivalents (the “Base Management Fee”). If, for any quarterly period during the term of the fee waiver agreement, the Reduced Base Management Fee would be greater than the Base Management Fee calculated under the terms of the Investment Management Agreement, the Investment Adviser shall only be entitled to the lesser of those two amounts. The Investment Adviser cannot recoup management fees that the Investment Adviser has previously waived. For the three months ended March 31, 2021 and March 31, 2020, management fees waived were approximately $3,637 and $3,543, respectively.
The incentive fee consists of two parts. The first part is calculated and payable quarterly in arrears and equals 20.0% of the Company’s “Pre-Incentive Fee Net Investment Income” for the immediately preceding quarter, subject to a “preferred return”, or “hurdle”, and a “catch-up” feature. “Pre-Incentive Fee Net Investment Income” means interest income, dividend income and any other income (including any other fees (other than fees for providing managerial assistance), such as commitment, origination, structuring, upfront, diligence and consulting fees or other fees that the Company receives from portfolio companies) accrued during the calendar quarter, minus the Company’s operating expenses for the quarter (including the base management fee, expenses payable under an administration agreement, as amended and restated (the “Administration Agreement”), with the Administrator, and any interest expense and distributions paid on any issued and outstanding preferred stock (of which there are none as of March 31, 2021), but excluding the incentive fee). Pre-Incentive Fee Net Investment Income includes, in the case of investments with a deferred interest feature (such as original issue discount, debt instruments with PIK interest and zero coupon securities), accrued income that the Company has not yet received in cash. Pre-Incentive Fee Net Investment Income does not include any realized capital gains, realized capital losses or unrealized capital appreciation or depreciation.
Pre-Incentive Fee Net Investment Income, expressed as a rate of return on the value of the Company’s net assets at the end of the immediately preceding calendar quarter, will be compared to a “hurdle rate” of 2.0% per quarter (8.0% annualized), subject to a “catch-up” provision measured as of the end of each calendar quarter. The hurdle rate is appropriately pro-rated for any partial periods. The calculation of the Company’s incentive fee with respect to the Pre-Incentive Fee Net Investment Income for each quarter is as follows:
No incentive fee is payable to the Investment Adviser in any calendar quarter in which the Company’s Pre-Incentive Fee Net Investment Income does not exceed the hurdle rate of 2.0% (the “preferred return” or “hurdle”).
100.0% of the Company’s Pre-Incentive Fee Net Investment Income with respect to that portion of such Pre-Incentive Fee Net Investment Income, if any, that exceeds the hurdle rate but is less than or equal to 2.5% in any calendar quarter (10.0% annualized) is payable to the Investment Adviser. This portion of the Company’s Pre-
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Incentive Fee Net Investment Income (which exceeds the hurdle rate but is less than or equal to 2.5%) is referred to as the “catch-up”. The catch-up provision is intended to provide the Investment Adviser with an incentive fee of 20.0% on all of the Company’s Pre-Incentive Fee Net Investment Income as if a hurdle rate did not apply when the Company’s Pre-Incentive Fee Net Investment Income exceeds 2.5% in any calendar quarter.
20.0% of the amount of the Company’s Pre-Incentive Fee Net Investment Income, if any, that exceeds 2.5% in any calendar quarter (10.0% annualized) is payable to the Investment Adviser once the hurdle is reached and the catch-up is achieved.
The second part of the incentive fee will be determined and payable in arrears as of the end of each calendar year (or upon termination of the Investment Management Agreement) and will equal 20.0% of the Company’s realized capital gains, if any, on a cumulative basis from inception through the end of each calendar year, computed net of all realized capital losses and unrealized capital depreciation on a cumulative basis, less the aggregate amount of any previously paid capital gain incentive fee.
In accordance with GAAP, the Company accrues a hypothetical capital gains incentive fee based upon the cumulative net realized capital gains and realized capital losses and the cumulative net unrealized capital appreciation and unrealized capital depreciation on investments held at the end of each period. Actual amounts paid to the Investment Adviser are consistent with the Investment Management Agreement and are based only on actual realized capital gains computed net of all realized capital losses and unrealized capital depreciation on a cumulative basis from inception through the end of each calendar year as if the entire portfolio was sold at fair value.
The following table summarizes the management fees and incentive fees incurred by the Company for the three months ended March 31, 2021 and March 31, 2020:
 Three Months Ended
 March 31, 2021March 31, 2020
Management fee$13,420 $13,858 
Less: management fee waiver(3,637)(3,543)
Total management fee9,783 10,315 
Incentive fee, excluding accrued capital gains incentive fees$7,248 $7,826 
Accrued capital gains incentive fees(1)$— $— 
(1)As of March 31, 2021 and March 31, 2020, no actual capital gains incentive fee was owed under the Investment Management Agreement by the Company, as cumulative net realized capital gains did not exceed cumulative unrealized capital depreciation.
The Company has entered into the Administration Agreement with the Administrator under which the Administrator provides administrative services. The Administrator maintains, or oversees the maintenance of, the Company’s consolidated financial records, prepares reports filed with the SEC, generally monitors the payment of the Company’s expenses and oversees the performance of administrative and professional services rendered by others. The Company will reimburse the Administrator for the Company’s allocable portion of overhead and other expenses incurred by the Administrator in performing its obligations to the Company under the Administration Agreement. Pursuant to the Administration Agreement and further restricted by the Company, the Administrator may, in its own discretion, submit to the Company for reimbursement some or all of the expenses that the Administrator has incurred on behalf of the Company during any quarterly period. As a result, the amount of expenses for which the Company will have to reimburse the Administrator may fluctuate in future quarterly periods and there can be no assurance given as to when, or if, the Administrator may determine to limit the expenses that the Administrator submits to the Company for reimbursement in the future. However, it is expected that the Administrator will continue to support part of the expense burden of the Company in the near future and may decide to not calculate and charge through certain overhead related amounts as well as continue to cover some of the indirect costs. The Administrator cannot recoup any expenses that the Administrator has previously waived. For the three months ended March 31, 2021 and March 31, 2020, approximately $754 and $655, respectively, of indirect administrative expenses were included in administrative expenses of which $0 and $0, respectively, were waived by the Administrator. As of March 31, 2021 and December 31, 2020, approximately $1,491 and $738, respectively, of indirect administrative expenses were included in payable to affiliates. For the three months ended March 31, 2021 and March 31, 2020, the reimbursement to the Administrator represented approximately 0.02% and 0.02%, respectively, of the Company's gross assets.
The Company, the Investment Adviser and the Administrator have also entered into a Trademark License Agreement, as amended, with New Mountain Capital, pursuant to which New Mountain Capital has agreed to grant the Company, the Investment Adviser and the Administrator a non-exclusive, royalty-free license to use the “New Mountain” and the “New
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Mountain Finance” names. Under the Trademark License Agreement, as amended, subject to certain conditions, the Company, the Investment Adviser and the Administrator will have a right to use the “New Mountain” and “New Mountain Finance” names, for so long as the Investment Adviser or one of its affiliates remains the investment adviser of the Company. Other than with respect to this limited license, the Company, the Investment Adviser and the Administrator will have no legal right to the “New Mountain” or the “New Mountain Finance” names.
Note 6. Related Parties
The Company has entered into a number of business relationships with affiliated or related parties.
    The Company has entered into the Investment Management Agreement with the Investment Adviser, a wholly-owned subsidiary of New Mountain Capital. Therefore, New Mountain Capital is entitled to any profits earned by the Investment Adviser, which includes any fees payable to the Investment Adviser under the terms of the Investment Management Agreement, less expenses incurred by the Investment Adviser in performing its services under the Investment Management Agreement.
The Company has entered into the Administration Agreement with the Administrator, a wholly-owned subsidiary of New Mountain Capital. The Administrator arranges office space for the Company and provides office equipment and administrative services necessary to conduct their respective day-to-day operations pursuant to the Administration Agreement. The Company reimburses the Administrator for the allocable portion of overhead and other expenses incurred by it in performing its obligations to the Company under the Administration Agreement, which includes the fees and expenses associated with performing administrative, finance and compliance functions, and the compensation of the Company’s chief financial officer and chief compliance officer and their respective staffs.
The Company, the Investment Adviser and the Administrator have entered into a royalty-free Trademark License Agreement, as amended, with New Mountain Capital, pursuant to which New Mountain Capital has agreed to grant the Company, the Investment Adviser and the Administrator a non-exclusive, royalty-free license to use the name “New Mountain” and “New Mountain Finance”.
The Company has adopted a formal code of ethics that governs the conduct of its officers and directors. These officers and directors also remain subject to the duties imposed by the 1940 Act and the Delaware General Corporation Law.
The Investment Adviser and its affiliates may also manage other funds in the future that may have investment mandates that are similar, in whole or in part, to the Company’s investment mandates. The Investment Adviser and its affiliates may determine that an investment is appropriate for the Company or for one or more of those other funds. In such event, depending on the availability of such investment and other appropriate factors, the Investment Adviser or its affiliates may determine that the Company should invest side-by-side with one or more other funds. Any such investments will be made only to the extent permitted by applicable law and interpretive positions of the SEC and its staff and consistent with the Investment Adviser’s allocation procedures. On October 8, 2019, the SEC issued an exemptive order (the “Exemptive Order”), which superseded a prior order issued on December 18, 2017, which permits the Company to co-invest in portfolio companies with certain funds or entities managed by the Investment Adviser or its affiliates in certain negotiated transactions where co-investing would otherwise be prohibited under the 1940 Act, subject to the conditions of the Exemptive Order. Pursuant to the Exemptive Order, the Company is permitted to co-invest with its affiliates if a “required majority” (as defined in Section 57(o) of the 1940 Act) of the Company's independent directors make certain conclusions in connection with a co-investment transaction, including, but not limited to, that (1) the terms of the potential co-investment transaction, including the consideration to be paid, are reasonable and fair to the Company and its stockholders and do not involve overreaching in respect of the Company or its stockholders on the part of any person concerned, and (2) the potential co-investment transaction is consistent with the interests of the Company's stockholders and is consistent with its then-current investment objective and strategies.
On March 30, 2020, an affiliate of the Investment Adviser purchased directly from NMNLC 105,030 shares of NMNLC’s common stock at a price of $107.63 per share, which represented the net asset value per share of NMNLC at the date of purchase, for an aggregate purchase price of approximately $11,315. Immediately thereafter, NMNLC redeemed 105,030 shares of its common stock held by the Company in exchange for a promissory note with a principal amount of $11,315 and a 7.0% interest rate, which was repaid by NMNLC to the Company on March 31, 2020.
On March 30, 2020, the Company entered into an unsecured revolving credit facility with NMF Investments III, L.L.C., an affiliate of the Investment Adviser, with a $30,000 maximum amount of revolver borrowings available and a maturity date of December 31, 2022. On May 4, 2020, the Company entered into an Amended and Restated Uncommitted Revolving Loan Agreement with NMF Investments III, L.L.C., which increased the maximum amounts of revolving borrowings available thereunder from $30,000 to $50,000. Refer to Note 7. Borrowings for discussion of the Unsecured Management Company Revolver (defined below).

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Note 7. Borrowings
On June 8, 2018 the Company's shareholders approved the application of the modified asset coverage requirements set forth in Section 61(a) of the 1940 Act, which resulted in the reduction from 200.0% to 150.0% of the minimum asset coverage ratio applicable to the Company as of June 9, 2018 (which means the Company can borrow $2 for every $1 of its equity). As a result of the Company's exemptive relief received on November 5, 2014, the Company is permitted to exclude its SBA-guaranteed debentures from the 150.0% asset coverage ratio that the Company is required to maintain under the 1940 Act. The agreements governing the NMFC Credit Facility, the 2018 Convertible Notes and the Unsecured Notes contain certain covenants and terms, including a requirement that the Company not exceed a debt-to-equity ratio of 1.65 to 1.00 at the time of incurring additional indebtedness and a requirement that the Company not exceed a secured debt ratio of 0.70 to 1.00 at any time. As of March 31, 2021, the Company’s asset coverage ratio was 184.6%.
Holdings Credit Facility—On October 24, 2017, the Company entered into the Third Amended and Restated Loan and Security Agreement among the Company, as the Collateral Manager, NMF Holdings, as the Borrower, Wells Fargo Securities, LLC, as the Administrative Agent and Wells Fargo Bank, National Association, as the Lender and Collateral Custodian (as amended from time to time, the "Holdings Credit Facility"). As of the most recent amendment on September 30, 2020, the maturity date of the Holdings Credit Facility is September 30, 2023, and the maximum facility amount is the lesser of $800,000 and the actual commitments of the lenders to make advances as of such date.
As of March 31, 2021, the maximum amount of revolving borrowings available under the Holdings Credit Facility is $745,000. Under the Holdings Credit Facility, NMF Holdings is permitted to borrow up to 25.0%, 45.0%, 67.5% or 70.0% of the purchase price of pledged assets, subject to approval by Wells Fargo Bank, National Association. The Holdings Credit Facility is non-recourse to the Company and is collateralized by all of the investments of NMF Holdings on an investment by investment basis. All fees associated with the origination or upsizing of the Holdings Credit Facility are capitalized on the Company’s Consolidated Statement of Assets and Liabilities and charged against income as other financing expenses over the life of the Holdings Credit Facility. The Holdings Credit Facility contains certain customary affirmative and negative covenants and events of default. In addition, the Holdings Credit Facility requires the Company to maintain a minimum asset coverage ratio of 150.0%. The covenants are generally not tied to mark to market fluctuations in the prices of NMF Holdings investments, but rather to the performance of the underlying portfolio companies.
    As of the most recent amendment on September 30, 2020, the Holdings Credit Facility bears interest at a rate of LIBOR plus 2.00% per annum for Broadly Syndicated Loans (as defined in the Third Amended and Restated Loan and Security Agreement) and LIBOR plus 2.50% per annum for all other investments. Previously the Holdings Credit Facility bore interest at a rate of LIBOR plus 1.75% per annum for Broadly Syndicated Loans (as defined in the Second Amendment to the Loan and Security Agreement) and LIBOR plus 2.25% per annum for all other investments. The Holdings Credit Facility also charges a non-usage fee, based on the unused facility amount multiplied by the Non-Usage Fee Rate (as defined in the Third Amended and Restated Loan and Security Agreement).
The following table summarizes the interest expense, non-usage fees and amortization of financing costs incurred on the Holdings Credit Facility for the three months ended March 31, 2021 and March 31, 2020:
 Three Months Ended
 March 31, 2021March 31, 2020
Interest expense$2,714 $5,421 
Non-usage fee$363 $212 
Amortization of financing costs$503 $329 
Weighted average interest rate2.4 %3.5 %
Effective interest rate3.2 %3.8 %
Average debt outstanding$450,163 $629,542 
As of March 31, 2021 and December 31, 2020, the outstanding balance on the Holdings Credit Facility was $450,163 and $450,163, respectively, and NMF Holdings was in compliance with the applicable covenants in the Holdings Credit Facility on such dates.
NMFC Credit Facility—The Senior Secured Revolving Credit Agreement, (as amended from time to time, and together with the related guarantee and security agreement, the "NMFC Credit Facility"), dated June 4, 2014, among the Company, as the Borrower, Goldman Sachs Bank USA, as the Administrative Agent and Collateral Agent, and Goldman Sachs Bank USA, Morgan Stanley Bank, N.A., Stifel Bank & Trust and MUFG Union Bank, N.A., as Lenders, is structured as a senior secured revolving credit facility. The NMFC Credit Facility is guaranteed by certain of the Company's domestic subsidiaries and proceeds from the NMFC Credit Facility may be used for general corporate purposes, including the funding of portfolio investments. The maturity date of the NMFC Credit Facility is June 4, 2022.
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As of March 31, 2021, the maximum amount of revolving borrowings available under the NMFC Credit Facility was $188,500. The Company is permitted to borrow at various advance rates depending on the type of portfolio investment, as outlined in the Senior Secured Revolving Credit Agreement. All fees associated with the origination of the NMFC Credit Facility are capitalized on the Company’s Consolidated Statement of Assets and Liabilities and charged against income as other financing expenses over the life of the NMFC Credit Facility. The NMFC Credit Facility contains certain customary affirmative and negative covenants and events of default, including certain financial covenants related to asset coverage and liquidity and other maintenance covenants.
The NMFC Credit Facility generally bears interest at a rate of LIBOR plus 2.50% per annum or the prime rate plus 1.50% per annum, and charges a commitment fee, based on the unused facility amount multiplied by 0.375% per annum (as defined in the Senior Secured Revolving Credit Agreement).
    The following table summarizes the interest expense, non-usage fees and amortization of financing costs incurred on the NMFC Credit Facility for the three months ended March 31, 2021 and March 31, 2020:
 Three Months Ended
 March 31, 2021March 31, 2020
Interest expense$685 $1,940 
Non-usage fee$79 $— 
Amortization of financing costs$34 $34 
Weighted average interest rate2.7 %4.1 %
Effective interest rate3.1 %4.2 %
Average debt outstanding$104,456 $188,500 
As of March 31, 2021 and December 31, 2020, the outstanding balance on the NMFC Credit Facility was $107,000 and $165,500, respectively, and NMFC was in compliance with the applicable covenants in the NMFC Credit Facility on such dates.
Unsecured Management Company Revolver—The Uncommitted Revolving Loan Agreement, (the "Unsecured Management Company Revolver"), dated March 30, 2020, by and between the Company, as the Borrower, and NMF Investments III, L.L.C., as Lender, an affiliate of the Investment Adviser, is structured as a discretionary unsecured revolving credit facility. The proceeds from the Unsecured Management Company Revolver may be used for general corporate purposes, including the funding of portfolio investments. The maturity date of the Unsecured Management Company Revolver is December 31, 2022. The Unsecured Management Company Revolver generally bears interest at a rate of 7.00% per annum (as defined in the Uncommitted Revolving Loan Agreement). On May 4, 2020, the Company entered into an Amended and Restated Uncommitted Revolving Loan Agreement with NMF Investments III, L.L.C., which increased the maximum amounts of revolving borrowings available thereunder from $30,000 to $50,000. As of March 31, 2021, the maximum amount of revolving borrowings available under the Unsecured Management Company Revolver was $50,000 and no borrowings were outstanding. For the three months ended March 31, 2021 and March 31, 2020, amortization of financing costs were $3 and $0, respectively.
    DB Credit Facility—The Loan Financing and Servicing Agreement (the "DB Credit Facility") dated December 14, 2018 and as amended from time to time, among NMFDB as the borrower, Deutsche Bank AG, New York Branch ("Deutsche Bank") as the facility agent, Lender and other agent from time to time party thereto and U.S. Bank National Association, as collateral agent and collateral custodian, is structured as a secured revolving credit facility and the maturity date is March 25, 2026.
    As of March 31, 2021, the maximum amount of revolving borrowings available under the DB Credit Facility was $280,000. The Company is permitted to borrow at various advance rates depending on the type of portfolio investment, as outlined in the Loan Financing and Servicing Agreement. The DB Credit Facility is non-recourse to the Company and is collateralized by all of the investments of NMFDB on an investment by investment basis. All fees associated with the origination of the DB Credit Facility are capitalized on the Company's Consolidated Statement of Assets and Liabilities and charged against income as other financing expenses over the life of the DB Credit Facility. The DB Credit Facility contains certain customary affirmative and negative covenants and events of default. The covenants are generally not tied to mark to market fluctuations in the prices of NMFDB investments, but rather to the performance of the underlying portfolio companies.
    The advances under the DB Credit Facility accrue interest at a per annum rate equal to the Applicable Margin plus the lender's Cost of Funds Rate. Prior to March 25, 2021, the Applicable Margin was equal to 2.60% during the Revolving Period and then increases by 0.20% during an Event of Default. Effective March 25, 2021, the Applicable Margin is equal to 2.35% during the Revolving Period and then increases by 0.20% during an Event of Default. The "Cost of Funds Rate" for a conduit
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lender is the lower of its commercial paper rate and the Base Rate plus 0.50%, and for any other lender is the Base Rate. The "Base Rate" is the three-months LIBOR Rate but may become an alternative base rate based on Deutsche Bank's base lending rate if certain LIBOR disruption events occur. The Company is also charged a non-usage fee, based on the unused facility amount multiplied by the Undrawn Fee Rate (as defined in the Loan Financing and Servicing Agreement) and a facility agent fee of 0.25% per annum on the total facility amount.
The following table summarizes the interest expense, non-usage fees and amortization of financing costs incurred on the DB Credit Facility for the three months ended March 31, 2021 and March 31, 2020:
 Three Months Ended
 March 31, 2021March 31, 2020
Interest expense(1)$1,659 $2,641 
Non-usage fee(1)$77 $57 
Amortization of financing costs$166 $159 
Weighted average interest rate3.1 %4.5 %
Effective interest rate3.5 %4.9 %
Average debt outstanding$218,556 $235,055 
(1)Interest expense includes the portion of the facility agent fee applicable to the drawn portion of the DB Credit Facility and non-usage fee includes the portion of the facility agent fee applicable to the undrawn portion of the DB Credit Facility.
    As of March 31, 2021 and December 31, 2020, the outstanding balance on the DB Credit Facility was $201,000 and $244,000, respectively, and NMFDB was in compliance with the applicable covenants in the DB Credit Facility on such dates.
    NMNLC Credit Facilities—The Revolving Credit Agreement (together with the related guarantee and security agreement, the “NMNLC Credit Facility”), dated September 21, 2018, by and between NMNLC, as the Borrower, and KeyBank National Association, as the Administrative Agent and Lender, was structured as a senior secured revolving credit facility and matured on September 23, 2020. The NMNLC Credit Facility was guaranteed by the Company and proceeds from the NMNLC Credit Facility were able to be used for funding of additional acquisition properties.
The NMNLC Credit Facility bore interest at a rate of LIBOR plus 2.50% per annum or the prime rate plus 1.50% per annum, and charged a commitment fee, based on the unused facility amount multiplied by 0.15% per annum (as defined in the Revolving Credit Agreement). For the three months ended March 31, 2020, interest expense, non-usage fees and amortization of financing costs were $0, $11 and $11, respectively.
The Credit Agreement (together with the related guarantee and security agreement, "the NMNLC Credit Facility II"), dated February 26, 2021, by and between NMNLC, as the Borrower, and City National Bank, as the Lender, is structured as a senior secured revolving credit facility and matures on February 25, 2022. The NMNLC Credit Facility II is guaranteed by the Company and proceeds from the NMNLC Credit Facility II are able to be used for funding of additional acquisition properties. As of March 31, 2021, the maximum amount of revolving borrowings available under the NMNLC Credit Facility II is $10,000.
The NMNLC Credit Facility II bears interest at a rate of LIBOR plus 2.75% per annum, and charges a commitment fee, based on the unused facility amount multiplied by 0.05% per annum (as defined in the Credit Agreement). For the three months ended March 31, 2021, interest expense, non-usage fees and amortization of financing costs were $0, $0 and $8, respectively. As of March 31, 2021, the outstanding balance on the NMNLC Credit Facility II was $0 and NMNLC was in compliance with the applicable covenants in the NMNLC Credit Facility II on such date.
Convertible Notes—On August 20, 2018, the Company closed a registered public offering of $100,000 aggregate principal amount of unsecured convertible notes (the “2018 Convertible Notes”), pursuant to an indenture, dated August 20, 2018, as supplemented by a first supplemental indenture thereto, dated August 20, 2018 (together the “2018A Indenture”). On August 30, 2018, in connection with the registered public offering, the Company issued an additional $15,000 aggregate principal amount of the 2018 Convertible Notes pursuant to the exercise of an overallotment option by the underwriter of the 2018 Convertible Notes. On June 7, 2019, the Company closed a registered public offering of an additional $86,250 aggregate principal amount of the 2018 Convertible Notes. These additional 2018 Convertible Notes constitute a further issuance of, rank equally in right of payment with, and form a single series with the $115,000 aggregate principal amount of 2018 Convertible Notes that the Company issued in August 2018.
    The 2018 Convertible Notes bear interest at an annual rate of 5.75%, payable semi-annually in arrears on February 15 and August 15 of each year, which commenced on February 15, 2019. The 2018 Convertible Notes will mature on August 15,
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2023 unless earlier converted, repurchased or redeemed pursuant to the terms of the 2018A Indenture. The Company may not redeem the 2018 Convertible Notes prior to May 15, 2023. On or after May 15, 2023, the Company may redeem the 2018 Convertible Notes for cash, in whole or from time to time in part, at its option at a redemption price, subject to an exception for redemption dates occurring after a record date but on or prior to the interest payment date, equal to the sum of (i) 100% of the principal amount of the 2018 Convertible Notes to be redeemed, (ii) accrued and unpaid interest thereon to, but excluding, the redemption date and (iii) a make-whole premium.
No sinking fund is provided for the 2018 Convertible Notes. Holders of 2018 Convertible Notes may, at their option, convert their 2018 Convertible Notes into shares of the Company’s common stock at any time on or prior to the close of business on the business day immediately preceding the maturity date of the 2018 Convertible Notes. In addition, if certain corporate events occur, holders of the 2018 Convertible Notes may require the Company to repurchase for cash all or part of their 2018 Convertible Notes at a repurchase price equal to 100.0% of the principal amount of the 2018 Convertible Notes to be repurchased, plus accrued and unpaid interest through, but excluding, the repurchase date.
The 2018A Indenture contains certain covenants, including covenants requiring the Company to provide certain financial information to the holders of the 2018 Convertible Notes and the trustee if the Company ceases to be subject to the reporting requirements of the Exchange Act. The 2018A Indenture also includes additional financial covenants related to asset coverage. These covenants are subject to limitations and exceptions that are described in the 2018A Indenture.
The following table summarizes certain key terms related to the convertible features of the Company’s 2018 Convertible Notes as of March 31, 2021:
2018 Convertible Notes
Initial conversion premium10.0 %
Initial conversion rate(1)65.8762 
Initial conversion price$15.18 
Conversion premium at March 31, 202110.0 %
Conversion rate at March 31, 2021(1)(2)65.8762 
Conversion price at March 31, 2021(2)(3)$15.18 
Last conversion price calculation dateAugust 20, 2020
(1)Conversion rates denominated in shares of common stock per $1 principal amount of the 2018 Convertible Notes converted.
(2)Represents conversion rate and conversion price, as applicable, taking into account certain de minimis adjustments that will be made on the conversion date.
(3)The conversion price in effect at March 31, 2021 was calculated on the last anniversary of the issuance and will be calculated again on the next anniversary, unless the exercise price shall have changed by more than 1.0% before the anniversary.
The conversion rate will be subject to adjustment upon certain events, such as stock splits and combinations, mergers, spin-offs, increases in dividends in excess of $0.34 per share per quarter and certain changes in control. Certain of these adjustments, including adjustments for increases in dividends, are subject to a conversion price floor of $13.80 per share. In no event will the total number of shares of common stock issuable upon conversion exceed 72.4637 per $1 principal amount. The Company has determined that the embedded conversion option in the 2018 Convertible Notes is not required to be separately accounted for as a derivative under GAAP.
The 2018 Convertible Notes are unsecured obligations and rank senior in right of payment to the Company’s existing and future indebtedness, if any, that is expressly subordinated in right of payment to the 2018 Convertible Notes; equal in right of payment to the Company’s existing and future unsecured indebtedness that is not so subordinated; effectively junior in right of payment to any of the Company’s secured indebtedness (including existing unsecured indebtedness that the Company later secures) to the extent of the value of the assets securing such indebtedness; and structurally junior to all existing and future indebtedness (including trade payables) incurred by the Company’s subsidiaries and financing vehicles. As reflected in Note 11. Earnings Per Share, the issuance is considered part of the if-converted method for calculation of diluted earnings per share.

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The following table summarizes the interest expense, amortization of financing costs and amortization of premium incurred on the 2018 Convertible Notes for the three months ended March 31, 2021 and March 31, 2020:
 Three Months Ended
 March 31, 2021March 31, 2020
Interest expense$2,893 $2,893 
Amortization of financing costs$97 $99 
Amortization of premium$(26)$(26)
Weighted average interest rate5.8 %5.8 %
Effective interest rate5.9 %5.9 %
Average debt outstanding$201,250 $201,250 
As of March 31, 2021 and December 31, 2020, the outstanding balance on the 2018 Convertible Notes was $201,250 and $201,250, respectively, and NMFC was in compliance with the terms of the 2018A Indenture on such date.
Unsecured Notes—On May 6, 2016, the Company issued $50,000 in aggregate principal amount of five-year unsecured notes (the “2016 Unsecured Notes”), pursuant to a note purchase agreement, dated May 4, 2016, to an institutional investor in a private placement. On September 30, 2016, the Company entered into an amended and restated note purchase agreement (the "NPA") and issued an additional $40,000 in aggregate principal amount of 2016 Unsecured Notes to institutional investors in a private placement. On February 16, 2021, the Company repaid all $90,000 in aggregate principal amount of the issued and outstanding 2016 Unsecured Notes. On June 30, 2017, the Company issued $55,000 in aggregate principal amount of five-year unsecured notes that mature on July 15, 2022 (the "2017A Unsecured Notes"), pursuant to the NPA and a supplement to the NPA. On January 30, 2018, the Company issued $90,000 in aggregate principal amount of five year unsecured notes that mature on January 30, 2023 (the "2018A Unsecured Notes") pursuant to the NPA and a second supplement to the NPA. On July 5, 2018, the Company issued $50,000 in aggregate principal amount of five year unsecured notes that mature on June 28, 2023 (the "2018B Unsecured Notes") pursuant to the NPA and a third supplement to the NPA (the "Third Supplement"). On April 30, 2019, the Company issued $116,500 in aggregate principal amount of five year unsecured notes that mature on April 30, 2024 (the "2019A Unsecured Notes") pursuant to the NPA and a fourth supplement to the NPA. On January 29, 2021, the Company issued $200,000 in aggregate principal amount of five year unsecured notes that mature on January 29, 2026 (the "2021A Unsecured Notes") pursuant to the NPA and a fifth supplement to the NPA. The NPA provides for future issuances of unsecured notes in separate series or tranches.
The 2016 Unsecured Notes bore interest at an annual rate of 5.313%, payable semi-annually on May 15 and November 15 of each year, which commenced on November 15, 2016. The 2017A Unsecured Notes bear interest at an annual rate of 4.760%, payable semi-annually on January 15 and July 15 of each year, which commenced on January 15, 2018. The 2018A Unsecured Notes bear interest at an annual rate of 4.870%, payable semi-annually on February 15 and August 15 of each year, which commenced on August 15, 2018. The 2018B Unsecured Notes bear interest at an annual rate of 5.360%, payable semi-annually on January 15 and July 15 of each year, which commenced on January 15, 2019. The 2019A Unsecured Notes bear interest at an annual rate of 5.494%, payable semi-annually on April 15 and October 15 of each year, commencing on October 15, 2019. The 2021A Unsecured Notes bear interest at an annual rate of 3.875%, payable semi-annually in arrears on January 29 and July 29 of each year, commencing on July 29, 2021. These interest rates are subject to increase in the event that: (i) subject to certain exceptions, the underlying unsecured notes or the Company ceases to have an investment grade rating or (ii) the aggregate amount of the Company’s unsecured debt falls below $150,000.  In each such event, the Company has the option to offer to prepay the underlying unsecured notes at par, in which case holders of the underlying unsecured notes who accept the offer would not receive the increased interest rate. In addition, the Company is obligated to offer to prepay the underlying unsecured notes at par if the Investment Adviser, or an affiliate thereof, ceases to be the Company’s investment adviser or if certain change in control events occur with respect to the Investment Adviser. 
The NPA contains customary terms and conditions for unsecured notes issued in a private placement, including, without limitation, an option to offer to prepay all or a portion of the unsecured notes under its governance at par (plus a make-whole amount, if applicable), affirmative and negative covenants such as information reporting, maintenance of the Company’s status as a BDC under the 1940 Act and a RIC under the Code, minimum stockholders’ equity, minimum asset coverage ratio, and prohibitions on certain fundamental changes at the Company or any subsidiary guarantor, as well as customary events of default with customary cure and notice, including, without limitation, nonpayment, misrepresentation in a material respect, breach of covenant, cross-default under other indebtedness of the Company or certain significant subsidiaries, certain judgments and orders, and certain events of bankruptcy. The Third Supplement includes additional financial covenants related to asset coverage as well as other terms.
On September 25, 2018, the Company closed a registered public offering of $50,000 in aggregate principal amount of five-year unsecured notes that mature on October 1, 2023 (the "5.75% Unsecured Notes" and together with the 2016 Unsecured
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Notes, 2017A Unsecured Notes, 2018A Unsecured Notes, 2018B Unsecured Notes, 2019A Unsecured Notes and the 2021A Unsecured Notes, the "Unsecured Notes") pursuant to an indenture, dated August 20, 2018, as supplemented by a second supplemental indenture thereto, dated September 25, 2018 (together, the "2018B Indenture"). On October 17, 2018, in connection with the registered public offering, the Company issued an additional $1,750 aggregate principal amount of the 5.75% Unsecured Notes pursuant to the exercise of an overallotment option by the underwriters of the 5.75% Unsecured Notes.
On March 8, 2021, the Company redeemed $51,750 in aggregate principal amount of the 5.75% Unsecured Notes at a redemption price of 100% plus accrued and unpaid interest.
The 5.75% Unsecured Notes bore interest at an annual rate of 5.75%, payable quarterly on January 1, April 1, July 1 and October 1 of each year, which commenced on January 1, 2019. The 5.75% Unsecured Notes were listed on the New York Stock Exchange and traded under the trading symbol “NMFX” until September 13, 2020. On September 14, 2020, the 5.75% Unsecured Notes began trading on the NASDAQ under the ticker symbol "NMFCL", until redeemed on March 8, 2021.
The Unsecured Notes are unsecured obligations and rank senior in right of payment to the Company’s existing and future indebtedness, if any, that is expressly subordinated in right of payment to the Unsecured Notes; equal in right of payment to the Company’s existing and future unsecured indebtedness that is not so subordinated; effectively junior in right of payment to any of the Company’s secured indebtedness (including existing unsecured indebtedness that the Company later secures) to the extent of the value of the assets securing such indebtedness; and structurally junior to all existing and future indebtedness (including trade payables) incurred by the Company’s subsidiaries and financing vehicles.
The following table summarizes the interest expense and amortization of financing costs incurred on the Unsecured Notes for the three months ended March 31, 2021 and March 31, 2020:
 Three Months Ended
 March 31, 2021March 31, 2020
Interest expense$6,527 $5,960 
Amortization of financing costs$1,256 $317 
Weighted average interest rate4.9 %5.3 %
Effective interest rate5.9 %5.6 %
Average debt outstanding$532,228 $453,250 
As of March 31, 2021 and December 31, 2020, the outstanding balance on the Unsecured Notes was $511,500 and $453,250, respectively, and the Company was in compliance with the terms of the NPA and the 2018B Indenture as of such dates, as applicable.
SBA-guaranteed debentures—On August 1, 2014 and August 25, 2017, respectively, SBIC I and SBIC II received licenses from the SBA to operate as SBICs.
The SBIC licenses allow SBICs to obtain leverage by issuing SBA-guaranteed debentures, subject to the issuance of a capital commitment by the SBA and other customary procedures. SBA-guaranteed debentures are non-recourse to the Company, interest only debentures with interest payable semi-annually and have a ten year maturity. The principal amount of SBA-guaranteed debentures is not required to be paid prior to maturity but may be prepaid at any time without penalty. The interest rate of SBA-guaranteed debentures is fixed on a semi-annual basis at a market-driven spread over U.S. Treasury Notes with ten year maturities. The SBA, as a creditor, will have a superior claim to the assets of SBIC I and SBIC II over the Company’s stockholders in the event SBIC I and SBIC II are liquidated or the SBA exercises remedies upon an event of default.
The maximum amount of borrowings available under current SBA regulations for a single licensee is $150,000 as long as the licensee has at least $75,000 in regulatory capital, receives a capital commitment from the SBA and has been through an examination by the SBA subsequent to licensing. In June 2018, legislation amended the 1958 Act by increasing the individual leverage limit from $150,000 to $175,000, subject to SBA approvals.
As of March 31, 2021 and December 31, 2020, SBIC I had regulatory capital of $75,000 and $75,000, respectively, and SBA-guaranteed debentures outstanding of $150,000 and $150,000, respectively. As of March 31, 2021 and December 31, 2020, SBIC II had regulatory capital of $75,000 and $75,000, respectively, and $150,000 and $150,000, respectively, of SBA-guaranteed debentures outstanding. The SBA-guaranteed debentures incur upfront fees of 3.435%, which consists of a 1.00% commitment fee and a 2.435% issuance discount, which are amortized over the life of the SBA-guaranteed debentures.

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The following table summarizes the Company’s SBA-guaranteed debentures as of March 31, 2021:
Issuance DateMaturity DateDebenture AmountInterest RateSBA Annual Charge
Fixed SBA-guaranteed debentures(1):    
March 25, 2015March 1, 2025$37,500 2.517 %0.355 %
September 23, 2015September 1, 202537,500 2.829 %0.355 %
September 23, 2015September 1, 202528,795 2.829 %0.742 %
March 23, 2016March 1, 202613,950 2.507 %0.742 %
September 21, 2016September 1, 20264,000 2.051 %0.742 %
September 20, 2017September 1, 202713,000 2.518 %0.742 %
March 21, 2018March 1, 202815,255 3.187 %0.742 %
Fixed SBA-guaranteed debentures(2):
September 19, 2018September 1, 202815,000 3.548 %0.222 %
September 25, 2019September 1, 202919,000 2.283 %0.222 %
March 25, 2020March 1, 203041,000 2.078 %0.222 %
March 25, 2020March 1, 203024,000 2.078 %0.275 %
September 23, 2020September 1, 203051,000 1.034 %0.275 %
Total SBA-guaranteed debentures $300,000   
(1)SBA-guaranteed debentures are held in SBIC I.
(2)SBA-guaranteed debentures are held in SBIC II.
    Prior to pooling, the SBA-guaranteed debentures bear interest at an interim floating rate of LIBOR plus 0.30%. Once pooled, which occurs in March and September each year, the SBA-guaranteed debentures bear interest at a fixed rate that is set to the current 10-year treasury rate plus a spread at each pooling date.
The following table summarizes the interest expense and amortization of financing costs incurred on the SBA-guaranteed debentures for the three months ended March 31, 2021 and March 31, 2020:
 Three Months Ended
March 31, 2021March 31, 2020
Interest expense$1,998 $1,823 
Amortization of financing costs$247 $202 
Weighted average interest rate2.7 %3.0 %
Effective interest rate3.0 %3.4 %
Average debt outstanding$300,000 $243,099 
The SBIC program is designed to stimulate the flow of private investor capital into eligible smaller businesses, as defined by the SBA. Under SBA regulations, SBICs are subject to regulatory requirements, including making investments in SBA-eligible businesses, investing at least 25.0% of its investment capital in eligible smaller businesses, as defined under the 1958 Act, placing certain limitations on the financing terms of investments, regulating the types of financing, prohibiting investments in smaller businesses with certain characteristics or in certain industries and requiring capitalization thresholds that limit distributions to the Company. SBICs are subject to an annual periodic examination by an SBA examiner to determine the SBIC’s compliance with the relevant SBA regulations and an annual financial audit of its financial statements that are prepared on a basis of accounting other than GAAP (such as ASC 820) by an independent auditor. As of March 31, 2021 and December 31, 2020, SBIC I and SBIC II were in compliance with SBA regulatory requirements.
    
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Leverage risk factors—The Company utilizes and may utilize leverage to the maximum extent permitted by the law for investment and other general business purposes. The Company's lenders will have fixed dollar claims on certain assets that are superior to the claims of the Company's common stockholders, and the Company would expect such lenders to seek recovery against these assets in the event of a default. The use of leverage also magnifies the potential for gain or loss on amounts invested. Leverage may magnify interest rate risk (particularly on the Company's fixed-rate investments), which is the risk that the prices of portfolio investments will fall or rise if market interest rates for those types of securities rise or fall. As a result, leverage may cause greater changes in the Company's net asset value. Similarly, leverage may cause a sharper decline in the Company's income than if the Company had not borrowed. Such a decline could negatively affect the Company's ability to make distributions to its stockholders. Leverage is generally considered a speculative investment technique. The Company's ability to service any debt incurred will depend largely on financial performance and will be subject to prevailing economic conditions and competitive pressures.
Note 8. Regulation
The Company has elected to be treated, and intends to comply with the requirements to continue to qualify annually, as a RIC under Subchapter M of the Code. In order to continue to qualify and be subject to tax as a RIC, among other things, the Company is required to timely distribute to its stockholders at least 90.0% of its investment company taxable income, as defined by the Code, for each year. The Company, among other things, intends to make and will continue to make the requisite distributions to its stockholders, which will generally relieve the Company from U.S. federal, state, and local income taxes (excluding excise taxes which may be imposed under the Code).
Additionally, as a BDC, the Company must not acquire any assets other than “qualifying assets” specified in the 1940 Act unless, at the time the acquisition is made, at least 70.0% of its total assets are qualifying assets (with certain limited exceptions). In addition, the Company must offer to make available to all "eligible portfolio companies" (as defined in the 1940 Act) managerial assistance.
Note 9. Commitments and Contingencies
In the normal course of business, the Company may enter into contracts that contain a variety of representations and warranties and which provide general indemnifications. The Company may also enter into future funding commitments such as revolving credit facilities, bridge financing commitments or delayed draw commitments. As of March 31, 2021, the Company had unfunded commitments on revolving credit facilities of $59,782, no outstanding bridge financing commitments and other future funding commitments of $40,521. As of December 31, 2020, the Company had unfunded commitments on revolving credit facilities of $63,411, no outstanding bridge financing commitments and other future funding commitments of $9,715. The unfunded commitments on revolving credit facilities and delayed draws are disclosed on the Company’s Consolidated Schedules of Investments.
The Company also had revolving borrowings available under the Holdings Credit Facility, the DB Credit Facility, the NMFC Credit Facility, the Unsecured Management Company Revolver and the NMNLC Credit Facility II as of March 31, 2021 and revolver borrowings available under the Holdings Credit Facility, the DB Credit Facility, the NMFC Credit Facility and the Unsecured Management Company Revolver as of December 31, 2020. See Note 7. Borrowings, for details.
The Company may from time to time enter into financing commitment letters. As of March 31, 2021 and December 31, 2020, the Company had commitment letters to purchase investments in the aggregate par amount of $0 and $44,918, respectively, which could require funding in the future.
As of March 31, 2021, the Company had unfunded commitments related to an equity investment in SLP III of $10,000, which may be funded at the Company's discretion.
COVID-19 Developments
On March 11, 2020 the World Health Organization declared COVID-19 a global pandemic and recommended containment and mitigation measures worldwide. The net asset value of the Company experienced a significant reduction from the period of March 31, 2020 through December 31, 2020 as compared to its net asset value as of December 31, 2019, due to an increase in unrealized depreciation of its investment portfolio resulting from decreases in fair value of investments. These decreases were attributable to the impact of the COVID-19 pandemic on the markets. As of March 31, 2021, the net asset value of the Company has experienced a recovery from that of March 31, 2020.
The extent of the impact of the COVID-19 pandemic on the financial performance of our current and future investments will depend on future developments, including the duration and spread of the outbreak, how quickly vaccines will continue to be distributed nationwide and globally, whether a "herd immunitey" will be achieved, whether the restrictions that were imposed to slow the spread of the virus will be lifted entirely and the impact of the COVID-19 pandemic on the financial markets and the overall economy, all of which are highly uncertain and cannot be predicted. To the extent the Company’s portfolio companies are adversely impacted by the effects of the COVID-19 pandemic, the Company may experience a material
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adverse impact on the its future net investment income, the fair value of its portfolio investments, its financial condition and the results of operations and financial condition of its portfolio companies.
Note 10. Net Assets
The table below illustrates the effect of certain transactions on the net asset accounts of the Company during the three months ended March 31, 2021:
Accumulated Overdistributed Earnings
 Common StockPaid in
Capital in
Excess
Accumulated
Net Investment
Accumulated Net Realized Net 
Unrealized
(Depreciation)
Total Net AssetsNon-
Controlling
Interest in
Total
 SharesPar Amountof ParIncomeLossesAppreciationof NMFCNMNLCNet Assets
Net assets at December 31, 202096,827,342 $968 $1,269,671 $105,981 $(88,250)$(66,495)$1,221,875 $15,014 $1,236,889 
Distributions declared — — — (29,048)— — (29,048)(301)(29,349)
Purchase of non-controlling interest in NMNLC— — — — — — — 3,403 3,403 
Net increase (decrease) in net assets resulting from operations— — — 28,668 (10,496)33,318 51,490 365 51,855 
Net assets at March 31, 202196,827,342 $968 $1,269,671 $105,601 $(98,746)$(33,177)$1,244,317 $18,481 $1,262,798 
The table below illustrates the effect of certain transactions on the net asset accounts of the Company during the three months ended March 31, 2020:
Accumulated Overdistributed Earnings
 Common StockPaid in
Capital in Excess
Accumulated
Net Investment
Accumulated Net Realized 
(Losses)
Net 
Unrealized
Total Net AssetsNon-Controlling Interest inTotal
 SharesPar Amountof ParIncomeGains(Depreciation)of NMFCNMNLCNet Assets
Net assets at December 31, 201996,827,342 $968 $1,287,853 $91,333 $(85,448)$(11,238)$1,283,468 $— $1,283,468 
Distributions declared— — — (32,921)— — (32,921)— (32,921)
Purchase of non-controlling interest in NMNLC— — — — — — — 11,315 11,315 
Net increase (decrease) in net assets resulting from operations— — — 31,305 114 (203,776)(172,357)(65)(172,422)
Net assets at March 31, 202096,827,342 $968 $1,287,853 $89,717 $(85,334)$(215,014)$1,078,190 $11,250 $1,089,440 
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Note 11. Earnings Per Share
The following information sets forth the computation of basic and diluted net increase (decrease) in the Company’s net assets per share resulting from operations for the three months ended March 31, 2021 and March 31, 2020:
 Three Months Ended
 March 31, 2021March 31, 2020
Earnings (loss) per share—basic  
Numerator for basic earnings (loss) per share:$51,490 $(172,357)
Denominator for basic weighted average share:96,827,342 96,827,342 
Basic earnings (loss) per share:$0.53 $(1.78)
Earnings (loss) per share—diluted(1)  
Numerator for increase (decrease) in net assets per share$51,490 $(172,357)
Adjustment for interest on Convertible Notes and incentive fees, net2,314 2,314 
Numerator for diluted earnings (loss) per share:$53,804 $(170,043)
Denominator for basic weighted average share96,827,342 96,827,342 
Adjustment for dilutive effect of Convertible Notes13,257,585 13,257,585 
Denominator for diluted weighted average share110,084,927 110,084,927 
Diluted earnings (loss) per share:$0.49 $(1.78)
(1)In applying the if-converted method, conversion is not assumed for purposes of computing diluted earnings per share if the effect would be anti-dilutive. For the three months ended March 31, 2020, there was anti-dilution.
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Note 12. Financial Highlights
The following information sets forth the Company's financial highlights for the three months ended March 31, 2021 and March 31, 2020:
 Three Months Ended
 March 31, 2021March 31, 2020
Per share data(1):  
Net asset value, January 1, 2021 and January 1, 2020, respectively$12.62 $13.26 
Net investment income0.30 0.32 
Net realized and unrealized gains (losses)0.23 (2.10)
Total net increase (decrease)0.53 (1.78)
Distributions declared to stockholders from net investment income(0.30)(0.34)
Net asset value, March 31, 2021 and March 31, 2020, respectively$12.85 $11.14 
Per share market value, March 31, 2021 and March 31, 2020, respectively$12.40 $6.80 
Total return based on market value(2)11.74 %(48.02)%
Total return based on net asset value(3)4.21 %(13.46)%
Shares outstanding at end of period96,827,342 96,827,342 
Average weighted shares outstanding for the period96,827,342 96,827,342 
Average net assets for the period$1,222,125 $1,281,212 
Ratio to average net assets:  
Net investment income9.62 %9.83 %
Total expenses, before waivers/reimbursements14.05 %14.54 %
Total expenses, net of waivers/reimbursements12.85 %13.43 %
Average debt outstanding—Unsecured Notes$532,228 $453,250 
Average debt outstanding—Holdings Credit Facility450,163 629,542 
Average debt outstanding—SBA-guaranteed debentures300,000 243,099 
Average debt outstanding—DB Credit Facility218,556 235,055 
Average debt outstanding—Convertible Notes201,250 201,250 
Average debt outstanding—NMFC Credit Facility104,456 188,500 
Asset coverage ratio(4)184.58 %164.08 %
Portfolio turnover6.69 %5.66 %
(1)Per share data is based on weighted average shares outstanding for the respective period (except for distributions declared to stockholders, which is based on actual rate per share).
(2)Total return is calculated assuming a purchase of common stock at the opening of the first day of the year and a sale on the closing of the last business day of the period. Dividends and distributions, if any, are assumed for purposes of this calculation, to be reinvested at prices obtained under the Company’s dividend reinvestment plan. Total return does not reflect sales load.
(3)Total return is calculated assuming a purchase at net asset value on the opening of the first day of the year and a sale at net asset value on the last day of the period. Dividends and distributions, if any, are assumed for purposes of this calculation, to be reinvested at the net asset value on the last day of the respective quarter. Total return does not reflect sales load.
(4)On November 5, 2014, the Company received exemptive relief from the SEC allowing the Company to modify the asset coverage requirement to exclude the SBA-guaranteed debentures from this calculation.
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Note 13. Recent Accounting Standards Updates
In March 2020, the Financial Accounting Standards Board (the "FASB") issued ASU 2020-04, Reference Rate Reform. The amendments in ASU 2020-04 provide optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. The standard is effective as of March 12, 2020 through December 31, 2022. Management is currently evaluating the impact of the optional guidance on the Company's consolidated financial statements and disclosures. The Company did not utilize the optional expedients and exceptions provided by ASU 2020-04 during the quarter ended March 31, 2021.
In August 2020, the FASB issued ASU 2020-06, Accounting for Convertible Instruments and Contracts in an Entity's Own Equity, which simplifies the accounting for convertible instruments by removing the separation models for (1) convertible debt with a cash conversion feature and (2) convertible instruments with a beneficial conversion feature. As a result, after adoption, a convertible debt instrument will be accounted for as a single liability measured at its amortized cost. Additionally, ASU 2020-06 requires the application of the if-converted method to calculate the impact of convertible instruments on diluted earnings per share. ASU 2020-06 is effective for fiscal years beginning after December 15, 2021, with early adoption permitted for fiscal years beginning after December 15, 2020, and can be adopted on either a fully retrospective or modified retrospective basis. The Company is in the process of evaluating the impact that this guidance will have on its consolidated financial statements.
Rule 2a-5 under the 1940 Act was recently adopted by the SEC and establishes requirements for determining fair value in good faith for purposes of the 1940 Act. The Company is evaluating the impact of adopting Rule 2a-5 on the consolidated financial statements and intends to comply with the new rule’s requirements on or before the compliance date in September 2022.
Note 14. Subsequent Events
    
On April 20, 2021, the Company entered into the Fifth Amendment to Loan and Security Agreement (the “Fifth Amendment”), which amended the Holdings Credit Facility. Pursuant to the Fifth Amendment, the revolving period was extended from September 30, 2021 to April 20, 2024. The Holdings Credit Facility continues to mature two years after the end of the revolving period. With the extension of the revolving period, the Holdings Credit Facility will now mature on April 20, 2026. As of the date of the Fifth Amendment, the aggregate commitments of the lenders to the Holding Credit Facility equaled $730,000.
The Fifth Amendment made a number of other modifications, including, but not limited to, the following. The applicable spread used to determine the per annum interest rate payable under the Holdings Credit Facility was modified to be the higher of (a) 1.85% (reduced from 2.25%) and (b) the pro rata portion of the facility secured by assets that are First Lien Loans that are also Broadly Syndicated Loans (as each such term is defined under the Holdings Credit Facility) multiplied by 1.60% (reduced from 2.00%), plus the pro rata portion of the facility secured by assets that are not First Lien Loans that are Broadly Syndicated Loans multiplied by 2.10% (reduced from 2.50%). The Fifth Amendment also modified the applicable spread that would be effective during an Event of Default or a Curable BDC Asset Coverage Event (as each such term is defined under the Holdings Credit Facility) by reducing such applicable spread from 3.75% to 3.25%.
On May 5, 2021, NMFC and SkyKnight Income Alpha, LLC ("SkyKnight Alpha") entered into a limited liability company agreement to establish a joint venture, NMFC Senior Loan Program IV LLC ("SLP IV"). NMFC and SkyKnight Alpha have transferred and contributed 100% of their membership interest in SLP I and SLP II to SLP IV, pursuant to contribution agreements. The purpose of the joint venture is to invest primarily in senior secured loans issued by portfolio companies within our core industry verticals. All investment decisions must be unanimously approved by the investment committee of SLP IV, which has equal representations from NMFC and SkyKnight Alpha. On May 5, 2021, SLP IV entered into a $370,000 revolving credit facility with Wells Fargo Bank, National Association which matures on May 5, 2026 and bears interest at a rate of LIBOR plus 1.60% per annum.
On May 4, 2021, the Company and the Investment Adviser entered into a Fee Waiver Agreement (the “Fee Wavier Agreement”). Pursuant to the Fee Waiver Agreement, the Investment Adviser agreed to voluntarily reduce the base management fees payable to the Investment Adviser by the Company under the Investment Management Agreement. Effective as of and for the quarter ended March 31, 2021 through the quarter ending December 31, 2022, the Investment Adviser agreed to waive a portion of the base management fee payable under the Investment Management Agreement such that the base management fee payable would not exceed 1.25% of the Company’s gross assets (the “Reduced Base Management Fee”). If, for any quarterly period during the term of the Fee Wavier Agreement, the Reduced Base Management Fee would be greater than the base management fee calculated under the terms of the Investment Management Agreement, the Investment Adviser shall only be entitled to the lesser of those two amounts.
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On April 30, 2021, the Company’s board of directors declared a second quarter 2021 distribution of $0.30 per share payable on June 30, 2021 to holders of record as of June 16, 2021.
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image0a011.jpg
 
Deloitte & Touche LLP
 
30 Rockefeller Plaza
New York, NY 10112
USA
 
Tel:    212 492 4000
Fax:   212 489 1687
www.deloitte.com

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the shareholders and the board of directors of New Mountain Finance Corporation

Results of Review of Interim Financial Information

We have reviewed the accompanying consolidated statement of assets and liabilities of New Mountain Finance Corporation and subsidiaries (the “Company”) including the consolidated schedule of investments, as of March 31, 2021, and the related consolidated statements of operations, changes in net assets, and cash flows for the three-month periods ended March 31, 2021 and 2020, and the related notes (collectively referred to as the "interim financial information"). Based on our reviews, we are not aware of any material modifications that should be made to the accompanying interim financial information for it to be in conformity with accounting principles generally accepted in the United States of America.

We have previously audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated statement of assets and liabilities of the Company, including the consolidated schedule of investments, as of December 31, 2020, and the related consolidated statements of operations, changes in net assets and cash flows for the year then ended (not presented herein); and in our report dated February 24, 2021, we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying consolidated statement of assets and liabilities as of December 31, 2020, is fairly stated, in all material respects, in relation to the consolidated statement of assets and liabilities from which it has been derived.

Basis for Review Results

This interim financial information is the responsibility of the Company's management. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our reviews in accordance with standards of the PCAOB. A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with the standards of the PCAOB, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.


/s/ DELOITTE & TOUCHE LLP

May 5, 2021




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Item 2.     Management’s Discussion and Analysis of Financial Condition and Results of Operations
    The information in management's discussion and analysis of financial condition and results of operations relates to New Mountain Finance Corporation, including its wholly-owned direct and indirect subsidiaries (collectively, "we", "us", "our", "NMFC" or the "Company").
Forward-Looking Statements
    The information contained in this section should be read in conjunction with the financial data and consolidated financial statements and notes thereto appearing elsewhere in this report. Some of the statements in this report (including in the following discussion) constitute forward-looking statements, which relate to future events or our future performance or our financial condition. The forward-looking statements contained in this section involve a number of risks and uncertainties, including:
statements concerning the impact of a protracted decline in the liquidity of credit markets;
the general economy, including interest and inflation rates, and the COVID-19 pandemic on the industries in which we invest;
our future operating results, our business prospects, the adequacy of our cash resources and working capital, and the impact of the COVID-19 pandemic thereon;
the ability of our portfolio companies to achieve their objectives and the impact of the COVID-19 pandemic thereon;
our ability to make investments consistent with our investment objectives, including with respect to the size, nature and terms of our investments;
the ability of New Mountain Finance Advisers BDC, L.L.C. (the "Investment Adviser") or its affiliates to attract and retain highly talented professionals;
actual and potential conflicts of interest with the Investment Adviser and New Mountain Capital Group, L.P. (together with New Mountain Capital, L.L.C. and its affiliates, "New Mountain Capital") whose ultimate owners include Steven B. Klinsky and related and other vehicles; and
the risk factors set forth in Item 1A.—Risk Factors contained in our annual report on Form 10-K for the year ended December 31, 2020 and in this quarterly report on Form 10-Q.
Forward-looking statements are identified by their use of such terms and phrases such as “anticipate”, “believe”, “continue”, “could”, “estimate”, “expect”, “intend”, “may”, “plan”, “potential”, “project”, “seek”, “should”, “target”, “will”, “would” or similar expressions. Actual results could differ materially from those projected in the forward-looking statements for any reason, including the factors set forth in Item 1A.—Risk Factors contained in our annual report on Form 10-K for the year ended December 31, 2020 and in this quarterly report on Form 10-Q.
    We have based the forward-looking statements included in this report on information available to us on the date of this report. We assume no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. Although we undertake no obligation to revise or update any forward-looking statements, you are advised to consult any additional disclosures that we may make directly to you or through reports that we have filed or in the future may file with the United States ("U.S.") Securities and Exchange Commission (the "SEC"), including annual reports on Form 10-K, registration statements on Form N-2, quarterly reports on Form 10-Q and current reports on Form 8-K.
Overview
    We are a Delaware corporation that was originally incorporated on June 29, 2010 and completed our initial public offering ("IPO") on May 19, 2011. We are a closed-end, non-diversified management investment company that has elected to be regulated as a business development company ("BDC") under the Investment Company Act of 1940, as amended (the "1940 Act"). We have elected to be treated, and intend to comply with the requirements to continue to qualify annually, as a regulated investment company ("RIC") under Subchapter M of the Internal Revenue Code of 1986, as amended (the "Code"). NMFC is also registered as an investment adviser under the Investment Advisers Act of 1940, as amended (the "Advisers Act"). Since our IPO, and through March 31, 2021, we raised approximately $893.2 million in net proceeds from additional offerings of our common stock.
    The Investment Adviser is a wholly-owned subsidiary of New Mountain Capital. New Mountain Capital is a firm with a track record of investing in the middle market. New Mountain Capital focuses on investing in defensive growth companies across its private equity, public equity and credit investment vehicles. The Investment Adviser manages our day-to-day
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operations and provides us with investment advisory and management services. The Investment Adviser also manages other funds that may have investment mandates that are similar, in whole or in part, to ours. New Mountain Finance Administration, L.L.C. (the "Administrator”), a wholly-owned subsidiary of New Mountain Capital, provides the administrative services necessary to conduct our day-to-day operations.
    We have established the following wholly-owned direct and indirect subsidiaries:
New Mountain Finance Holdings, L.L.C. ("NMF Holdings" or the "Predecessor Operating Company") and New Mountain Finance DB, L.L.C. ("NMFDB"), whose assets are used to secure NMF Holdings’ credit facility and NMFDB’s credit facility, respectively;
New Mountain Finance SBIC, L.P. ("SBIC I")  and New Mountain Finance SBIC II, L.P. ("SBIC II"), who have received licenses from the United States ("U.S.") Small Business Administration ("SBA") to operate as small business investment companies ("SBICs") under Section 301(c) of the Small Business Investment Act of 1958, as amended (the "1958 Act") and their general partners, New Mountain Finance SBIC G.P., L.L.C. ("SBIC I GP") and New Mountain Finance SBIC II G.P., L.L.C. ("SBIC II GP"), respectively;
NMF Ancora Holdings Inc. ("NMF Ancora"), NMF QID Holdings, Inc. ("NMF QID") NMF YP Holdings Inc. ("NMF YP") and NMF Permian Holdings LLC ("NMF Permian"), which serve as tax blocker corporations by holding equity or equity-like investments in portfolio companies organized as limited liability companies (or other forms of pass-through entities); we consolidate our tax blocker corporations for accounting purposes but the tax blocker corporations are not consolidated for income tax purposes and may incur income tax expense as a result of their ownership of the portfolio companies; and
New Mountain Finance Servicing, L.L.C. ("NMF Servicing"), which serves as the administrative agent on certain investment transactions.
    New Mountain Net Lease Corporation ("NMNLC") is a majority-owned consolidated subsidiary of ours, which acquires commercial real estate properties that are subject to ‘‘triple net’’ leases has elected to be treated, and intends to comply with the requirements to continue to qualify annually, as a real estate investment trust, or REIT, within the meaning of Section 856(a) of the Code.
    Our investment objective is to generate current income and capital appreciation through the sourcing and origination of debt securities at all levels of the capital structure, including first and second lien debt, notes, bonds and mezzanine securities. The first lien debt may include traditional first lien senior secured loans or unitranche loans. Unitranche loans combine characteristics of traditional first lien senior secured loans as well as second lien and subordinated loans. Unitranche loans will expose us to the risks associated with second lien and subordinated loans to the extent we invest in the “last out” tranche. In some cases, our investments may also include equity interests.
    Our primary focus is in the debt of defensive growth companies, which are defined as generally exhibiting the following characteristics: (i) sustainable secular growth drivers, (ii) high barriers to competitive entry, (iii) high free cash flow after capital expenditure and working capital needs, (iv) high returns on assets and (v) niche market dominance. Similar to us, SBIC I's and SBIC II's investment objectives are to generate current income and capital appreciation under our investment criteria. However, SBIC I's and SBIC II's investments must be in SBA-eligible small businesses. Our portfolio may be concentrated in a limited number of industries. As of March 31, 2021, our top five industry concentrations were software, business services, healthcare services, education and investment funds (which includes our investments in our joint ventures).
As of March 31, 2021, our net asset value was approximately $1,244.3 million and our portfolio had a fair value of approximately $3,018.6 million in 102 portfolio companies, with a weighted average yield to maturity at cost for income producing investments ("YTM at Cost") of approximately 8.8% and a weighted average yield to maturity at cost for all investments ("YTM at Cost for Investments") of approximately 8.2%. The YTM at Cost calculation assumes that all investments, including secured collateralized agreements, not on non-accrual are purchased at cost on the quarter end date and held until their respective maturities with no prepayments or losses and exited at par at maturity. The YTM at Cost for Investments calculation assumes that all investments, including secured collateralized agreements, are purchased at cost on the quarter end date and held until their respective maturities with no prepayments or losses and exited at par at maturity. YTM at Cost and YTM at Cost for Investments calculations exclude the impact of existing leverage. YTM at Cost and YTM at Cost for Investments use the London Interbank Offered Rate ("LIBOR") curves at each quarter's end date. The actual yield to maturity may be higher or lower due to the future selection of the LIBOR contracts by the individual companies in our portfolio or other factors.

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Recent Developments
Holdings Credit Facility Amendment
On April 20, 2021, we entered into the Fifth Amendment to Loan and Security Agreement (the “Fifth Amendment”), which amended the Holdings Credit Facility. Pursuant to the Fifth Amendment, the revolving period was extended from September 30, 2021 to April 20, 2024. The Holdings Credit Facility continues to mature two years after the end of the revolving period. With the extension of the revolving period, the Holdings Credit Facility will now mature on April 20, 2026. As of the date of the Fifth Amendment, the aggregate commitments of the lenders to the Holding Credit Facility equaled $730.0 million.
The Fifth Amendment made a number of other modifications, including, but not limited to, the following. The applicable spread used to determine the per annum interest rate payable under the Holdings Credit Facility was modified to be the higher of (a) 1.85% (reduced from 2.25%) and (b) the pro rata portion of the facility secured by assets that are First Lien Loans that are also Broadly Syndicated Loans (as each such term is defined under the Holdings Credit Facility) multiplied by 1.60% (reduced from 2.00%), plus the pro rata portion of the facility secured by assets that are not First Lien Loans that are Broadly Syndicated Loans multiplied by 2.10% (reduced from 2.50%). The Fifth Amendment also modified the applicable spread that would be effective during an Event of Default or a Curable BDC Asset Coverage Event (as each such term is defined under the Holdings Credit Facility) by reducing such applicable spread from 3.75% to 3.25%.
NMFC Senior Loan Program IV LLC
On May 5, 2021, NMFC and SkyKnight Income Alpha, LLC ("SkyKnight Alpha") entered into a limited liability company agreement to establish a joint venture, NMFC Senior Loan Program IV LLC ("SLP IV"). NMFC and SkyKnight Alpha have transferred and contributed 100% of their membership interest in SLP I and SLP II to SLP IV, pursuant to contribution agreements. The purpose of the joint venture is to invest primarily in senior secured loans issued by portfolio companies within our core industry verticals. All investment decisions must be unanimously approved by the investment committee of SLP IV, which has equal representations from NMFC and SkyKnight Alpha. On May 5, 2021, SLP IV entered into a $370.0 million revolving credit facility with Wells Fargo Bank, National Association which matures on May 5, 2026 and bears interest at a rate of LIBOR plus 1.60% per annum.
Management Fee Waiver
On May 4, 2021, we and the Investment Adviser entered into a Fee Waiver Agreement (the “Fee Wavier Agreement”). Pursuant to the Fee Waiver Agreement, the Investment Adviser agreed to voluntarily reduce the base management fees payable to the Investment Adviser by us under the Investment Management Agreement. Effective as of and for the quarter ended March 31, 2021 through the quarter ending December 31, 2022, the Investment Adviser agreed to waive a portion of the base management fee payable under the Investment Management Agreement such that the base management fee payable would not exceed 1.25% of our gross assets (the “Reduced Base Management Fee”). If, for any quarterly period during the term of the Fee Wavier Agreement, the Reduced Base Management Fee would be greater than the base management fee calculated under the terms of the Investment Management Agreement, the Investment Adviser shall only be entitled to the lesser of those two amounts.
Distributions
On April 30, 2021, our board of directors declared a second quarter 2021 distribution of $0.30 per share payable on June 30, 2021 to holders of record as of June 16, 2021.
We will, subject to extraordinary circumstances, pay quarterly distributions to our common stockholders of at least thirty cents ($0.30) per quarter over the next seven quarters beginning with the second quarter distribution to be paid on June 30, 2021 and ending in the fourth quarter of 2022, subject to any possible extensions. The declaration of any such future distributions will be subject to the availability of legally distributable funds and the discretion and approval of our board of directors. The Investment Adviser has informed us that, to the extent necessary, it will waive incentive fees payable to the Investment Adviser in the event that there is an insufficient amount of legally distributable funds available to us to make the thirty cent ($0.30) distributions through the periods described above.
COVID-19 Developments
    Our operating results and portfolio companies may be negatively impacted by the COVID-19 pandemic. While several countries, as well as certain states, counties and cities in the United States, have relaxed initial public health restrictions with the view to partially or fully reopening their economies, many cities have since experienced a surge in the reported number of cases, hospitalizations and deaths related to the COVID-19 pandemic. These surges have led to the re-introduction of such restrictions and business shutdowns in certain states in the United States and globally and could continue to lead to the re-introduction of such restrictions elsewhere. Health advisors warn that recurring COVID-19 outbreaks will continue if reopening
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is pursued too soon or in the wrong manner, which may lead to the re-introduction or continuation of certain public health restrictions (such as instituting quarantines, prohibitions on travel and the closure of offices, businesses, schools, retail stores and other public venues). Additionally, travelers from the United States are restricted from visiting many countries including countries in Europe, Asia, Africa and South America. These continued travel restrictions may prolong the global economic downturn. In addition, although the Federal Food and Drug Administration authorized vaccines beginning in December 2020 and a significant portion of the U.S. population have been vaccinated, and it remains unclear how quickly the vaccines will continue to be distributed nationwide and globally, or when “herd immunity” will be achieved and the restrictions that were imposed to slow the spread of the virus will be lifted entirely. Any delay in distributing the vaccines could lead people to continue to self-isolate and not participate in the economy at pre-pandemic levels for a prolonged period of time. Even after the COVID-19 pandemic subsides, the U.S. economy and most other major global economies may continue to experience a recession, and we anticipate our business and operations could be materially adversely affected by a prolonged recession in the United States and other major markets.
This outbreak is having, and any future outbreaks could have, an adverse impact on the markets and the economy in general, which could have a material adverse impact on, among other things, the ability of lenders to originate loans, the volume and type of loans originated, and the volume and type of amendments and waivers granted to borrowers and remedial actions taken in the event of a borrower default, each of which could negatively impact the amount and quality of loans available for investment by us and returns to us, among other things. As of the date of this quarterly report on Form 10-Q, it is impossible to determine the scope of this outbreak, or any future outbreaks, how long any such outbreak, market disruption or uncertainties may last, the effect any governmental actions will have or the full potential impact on us and our portfolio companies. Any potential impact to our results of operations will depend to a large extent on future developments and new information that could emerge regarding the duration and severity of COVID-19 and the actions taken by authorities and other entities to contain COVID-19 or treat its impact, all of which are beyond our control. These potential impacts, while uncertain, could adversely affect our and our portfolio companies’ operating results.
An increase in unrealized depreciation of our investment portfolio due to decreases in fair value of investments attributable to the COVID-19 pandemic has resulted in a significant reduction in our net asset value from the period of March 31, 2020 through December 31, 2020 as compared to its net asset value as of December 31, 2019. As of the three months ended March 31, 2021, our net asset value has experienced a recovery from that of the three months ended March 31, 2020. As of March 31, 2021, we were in compliance with our asset coverage requirements under the 1940 Act. In addition, we are not in default of any of the asset coverage requirements under any of our credit facilities as of March 31, 2021. For additional discussion on the impact of COVID-19 on our portfolio companies, see “Monitoring of Portfolio Investments”.
Critical Accounting Policies
    The preparation of financial statements and related disclosures in conformity with accounting principles generally accepted in the United States of America ("GAAP") requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and revenues and expenses during the periods reported. Actual results could materially differ from those estimates. We have identified the following items as critical accounting policies.
Basis of Accounting
    We consolidate our wholly-owned direct and indirect subsidiaries: NMF Holdings, NMF Servicing, NMFDB, SBIC I, SBIC I GP, SBIC II, SBIC II GP, NMF Ancora, NMF QID, NMF YP and NMF Permian and our majority-owned consolidated subsidiary, NMNLC. We are an investment company following accounting and reporting guidance as described in Accounting Standards Codification Topic 946, Financial Services—Investment Companies, ("ASC 946").
Valuation and Leveling of Portfolio Investments
    At all times consistent with GAAP and the 1940 Act, we conduct a valuation of assets, which impacts our net asset value.
    We value our assets on a quarterly basis, or more frequently if required under the 1940 Act. In all cases, our board of directors is ultimately and solely responsible for determining the fair value of our portfolio investments on a quarterly basis in good faith, including investments that are not publicly traded, those whose market prices are not readily available and any other situation where our portfolio investments require a fair value determination. Security transactions are accounted for on a trade date basis. Our quarterly valuation procedures are set forth in more detail below:
(1)Investments for which market quotations are readily available on an exchange are valued at such market quotations based on the closing price indicated from independent pricing services.
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(2)Investments for which indicative prices are obtained from various pricing services and/or brokers or dealers are valued through a multi-step valuation process, as described below, to determine whether the quote(s) obtained is representative of fair value in accordance with GAAP.
a.Bond quotes are obtained through independent pricing services. Internal reviews are performed by the investment professionals of the Investment Adviser to ensure that the quote obtained is representative of fair value in accordance with GAAP and, if so, the quote is used. If the Investment Adviser is unable to sufficiently validate the quote(s) internally and if the investment's par value or its fair value exceeds the materiality threshold, the investment is valued similarly to those assets with no readily available quotes (see (3) below); and
b.For investments other than bonds, we look at the number of quotes readily available and perform the following procedures:
i.Investments for which two or more quotes are received from a pricing service are valued using the mean of the mean of the bid and ask of the quotes obtained. We will evaluate the reasonableness of the quote, and if the quote is determined to not be representative of fair value, we will use one or more of the methodologies outlined below to determine fair value;
ii.Investments for which one quote is received from a pricing service are validated internally. The investment professionals of the Investment Adviser analyze the market quotes obtained using an array of valuation methods (further described below) to validate the fair value. If the Investment Adviser is unable to sufficiently validate the quote internally and if the investment's par value or its fair value exceeds the materiality threshold, the investment is valued similarly to those assets with no readily available quotes (see (3) below).
(3)Investments for which quotations are not readily available through exchanges, pricing services, brokers, or dealers are valued through a multi-step valuation process:
a.Each portfolio company or investment is initially valued by the investment professionals of the Investment Adviser responsible for the credit monitoring;
b.Preliminary valuation conclusions will then be documented and discussed with our senior management;
c.If an investment falls into (3) above for four consecutive quarters and if the investment's par value or its fair value exceeds the materiality threshold, then at least once each fiscal year, the valuation for each portfolio investment for which we do not have a readily available market quotation will be reviewed by an independent valuation firm engaged by our board of directors; and
d.When deemed appropriate by our management, an independent valuation firm may be engaged to review and value investment(s) of a portfolio company, without any preliminary valuation being performed by the Investment Adviser. The investment professionals of the Investment Adviser will review and validate the value provided.
    For investments in revolving credit facilities and delayed draw commitments, the cost basis of the funded investments purchased is offset by any costs/netbacks received for any unfunded portion on the total balance committed. The fair value is also adjusted for the price appreciation or depreciation on the unfunded portion. As a result, the purchase of a commitment not completely funded may result in a negative fair value until it is called and funded.
    The values assigned to investments are based upon available information and do not necessarily represent amounts which might ultimately be realized, since such amounts depend on future circumstances and cannot be reasonably determined until the individual positions are liquidated. Due to the inherent uncertainty of determining the fair value of investments that do not have a readily available market value, the fair value of our investments may fluctuate from period to period and the fluctuations could be material.
    GAAP fair value measurement guidance classifies the inputs used in measuring fair value into three levels as follows:
    Level I—Quoted prices (unadjusted) are available in active markets for identical investments and we have the ability to access such quotes as of the reporting date. The type of investments which would generally be included in Level I include active exchange-traded equity securities and exchange-traded derivatives. As required by Accounting Standards Codification Topic 820, Fair Value Measurements and Disclosures ("ASC 820"), we, to the extent that we hold such investments, do not adjust the quoted price for these investments, even in situations where we hold a large position and a sale could reasonably impact the quoted price.
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    Level II—Pricing inputs are observable for the investments, either directly or indirectly, as of the reporting date, but are not the same as those used in Level I. Level II inputs include the following:
Quoted prices for similar assets or liabilities in active markets;
Quoted prices for identical or similar assets or liabilities in non-active markets (examples include corporate and municipal bonds, which trade infrequently);
Pricing models whose inputs are observable for substantially the full term of the asset or liability (examples include most over-the-counter derivatives, including foreign exchange forward contracts); and
Pricing models whose inputs are derived principally from or corroborated by observable market data through correlation or other means for substantially the full term of the asset or liability.
    Level III—Pricing inputs are unobservable for the investment and include situations where there is little, if any, market activity for the investment.
    The inputs used to measure fair value may fall into different levels. In all instances when the inputs fall within different levels of the hierarchy, the level within which the fair value measurement is categorized is based on the lowest level of input that is significant to the fair value measurement in its entirety. As such, a Level III fair value measurement may include inputs that are both observable and unobservable. Gains and losses for such assets categorized within the Level III table below may include changes in fair value that are attributable to both observable inputs and unobservable inputs.
    The inputs into the determination of fair value require significant judgment or estimation by management and consideration of factors specific to each investment. A review of the fair value hierarchy classifications is conducted on a quarterly basis. Changes in the observability of valuation inputs may result in the transfer of certain investments within the fair value hierarchy from period to period.
    The following table summarizes the levels in the fair value hierarchy that our portfolio investments fall into as of March 31, 2021:
(in thousands)TotalLevel ILevel IILevel III
First lien$1,576,600 $— $76,750 $1,499,850 
Second lien696,209 — 301,291 394,918 
Subordinated37,295 — — 37,295 
Equity and other708,508 — — 708,508 
Total investments$3,018,612 $— $378,041 $2,640,571 
    We generally use the following framework when determining the fair value of investments where there are little, if any, market activity or observable pricing inputs. We typically determine the fair value of our performing debt investments utilizing an income approach. Additional consideration is given using a market based approach, as well as reviewing the overall underlying portfolio company's performance and associated financial risks. The following outlines additional details on the approaches considered:
    Company Performance, Financial Review, and Analysis:  Prior to investment, as part of our due diligence process, we evaluate the overall performance and financial stability of the portfolio company. Post investment, we analyze each portfolio company's current operating performance and relevant financial trends versus prior year and budgeted results, including, but not limited to, factors affecting its revenue and earnings before interest, taxes, depreciation, and amortization ("EBITDA") growth, margin trends, liquidity position, covenant compliance and changes to its capital structure. We also attempt to identify and subsequently track any developments at the portfolio company, within its customer or vendor base or within the industry or the macroeconomic environment, generally, that may alter any material element of our original investment thesis. This analysis is specific to each portfolio company. We leverage the knowledge gained from our original due diligence process, augmented by this subsequent monitoring, to continually refine our outlook for each of our portfolio companies and ultimately form the valuation of our investment in each portfolio company. When an external event such as a purchase transaction, public offering or subsequent sale occurs, we will consider the pricing indicated by the external event to corroborate the private valuation.
    For debt investments, we may employ the Market Based Approach (as described below) to assess the total enterprise value of the portfolio company, in order to evaluate the enterprise value coverage of our debt investment. For equity investments or in cases where the Market Based Approach implies a lack of enterprise value coverage for the debt investment, we may additionally employ a discounted cash flow analysis based on the free cash flows of the portfolio company to assess the total enterprise value. After enterprise value coverage is demonstrated for our debt investments through the method(s) above, the Income Based Approach (as described below) may be employed to estimate the fair value of the investment.
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Market Based Approach:  We may estimate the total enterprise value of each portfolio company by utilizing market value cash flow (EBITDA) multiples of publicly traded comparable companies and comparable transactions. We consider numerous factors when selecting the appropriate companies whose trading multiples are used to value our portfolio companies. These factors include, but are not limited to, the type of organization, similarity to the business being valued, and relevant risk factors, as well as size, profitability and growth expectations. We may apply an average of various relevant comparable company EBITDA multiples to the portfolio company's latest twelve month ("LTM") EBITDA or projected EBITDA to calculate the enterprise value of the portfolio company. Significant increases or decreases in the EBITDA multiple will result in an increase or decrease in enterprise value, which may result in an increase or decrease in the fair value estimate of the investment. In applying the market based approach as of March 31, 2021, we used the relevant EBITDA multiple ranges set forth in the table below to determine the enterprise value of our portfolio companies. We believe these were reasonable ranges in light of current comparable company trading levels and the specific portfolio companies involved.
Income Based Approach:  We also may use a discounted cash flow analysis to estimate the fair value of the investment. Projected cash flows represent the relevant security's contractual interest, fee and principal payments plus the assumption of full principal recovery at the investment's expected maturity date. These cash flows are discounted at a rate established utilizing a combination of a yield calibration approach and a comparable investment approach. The yield calibration approach incorporates changes in the credit quality (as measured by relevant statistics) of the portfolio company, as compared to changes in the yield associated with comparable credit quality market indices, between the date of origination and the valuation date. The comparable investment approach utilizes an average yield-to maturity of a selected set of high-quality, liquid investments to determine a comparable investment discount rate. Significant increases or decreases in the discount rate would result in a decrease or increase in the fair value measurement. In applying the income based approach as of March 31, 2021, we used the discount ranges set forth in the table below to value investments in our portfolio companies.
The unobservable inputs used in the fair value measurement of our Level III investments as of March 31, 2021 were as follows:
(in thousands)  Range
TypeFair Value as of March 31, 2021ApproachUnobservable InputLowHighWeighted
Average
First lien$1,356,548 Market & income approachEBITDA multiple5.0x35.0x14.8x
Revenue multiple5.0x11.0x7.1x
 Discount rate4.8 %18.4 %7.8 %
99,862 Market quoteBroker quoteN/AN/AN/A
43,440 OtherN/A(1)N/AN/AN/A
Second lien279,853 Market & income approachEBITDA multiple7.5x32.0x15.0x
 Discount rate6.2 %24.7 %10.3 %
94,803 Market quoteBroker quoteN/AN/AN/A
20,262 OtherN/A(1)N/AN/AN/A
Subordinated37,295 Market & income approachEBITDA multiple8.0x13.5x10.0x
 Discount rate11.5 %17.3 %13.6 %
Equity and other708,350 Market & income approachEBITDA multiple5.0x19.5x11.4x
 Discount rate5.8 %35.2 %11.2 %
158 OtherN/A(1)N/AN/AN/A
$2,640,571      
(1)Fair value was determined based on transaction pricing or recent acquisition or sale as the best measure of fair value with no material changes in operations of the related portfolio company since the transaction date.

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NMFC Senior Loan Program I LLC
    NMFC Senior Loan Program I LLC ("SLP I") was formed as a Delaware limited liability company on May 27, 2014 and commenced operations on June 10, 2014. SLP I is a portfolio company held by us. SLP I was structured as a private investment fund, in which all of the investors were "qualified purchasers", as such term is defined in section 2(a)(51) of the 1940 Act. Transfer of interests in SLP I are subject to restrictions and, as a result, interests are not readily marketable. SLP I operates under a limited liability company agreement (the "SLP I Agreement") and will continue in existence until August 31, 2022, subject to earlier termination pursuant to certain terms of the SLP I Agreement. The term may be extended pursuant to certain terms of the SLP I Agreement. SLP I invests in senior secured loans issued by companies within our core industry verticals. These investments are typically broadly syndicated first lien loans.
SLP I's re-investment period ended on August 31, 2020. As of this date, the fund ceased new investment activity and any principal repayments from investments were used to repay SLP I's revolving credit facility. Due to the expiration of the investment period, a member expressed an interest to withdraw from the fund. Effective December 11, 2020, this member, with the consent of the other members pursuant to the Withdrawal and Distribution Agreement dated as of December 11, 2020, fully withdrew as a member of SLP I through an in-kind distribution. Immediately following the effectiveness of this withdrawal, the remaining members of SLP I entered into the First Amended and Restated Limited Liability Company Agreement (the “Restated SLP I Agreement”), which among other matters, removed us as the managing member of SLP I and made other changes to its governance and management. Under the Restated SLP I Agreement, SLP I is managed and all investment decisions are made by a board of members, which has equal representation from all investors. No revisions were made to the term of SLP I or the reinvestment period end date.
As of March 31, 2021, SLP I had total investments with an aggregate fair value of approximately $125.9 million, debt outstanding of $88.6 million and capital that had been called and funded of $43.0 million. As of December 31, 2020, SLP I had total investments with an aggregate fair value of approximately $124.7 million, debt outstanding of $188.9 million and capital that had been called and funded of $43.0 million. Our investment in SLP I is disclosed on our Consolidated Schedule of Investments as of March 31, 2021 and December 31, 2020.
    Below is a summary of SLP I's portfolio, along with a listing of the individual investments in SLP I's portfolio as of March 31, 2021 and December 31, 2020:
March 31, 2021December 31, 2020
First lien investments (1)$127,366 $127,660 
Weighted average interest rate on first lien investments (2)4.74 %4.85 %
Number of portfolio companies in SLP I34 34 
Largest portfolio company investment (1)$7,778 $7,797 
Total of five largest portfolio company investments (1)$34,847 $34,918 
(1)Reflects principal amount or par value of investment.
(2)Computed as the all in interest rate in effect on accruing investments divided by the total principal amount of investments.


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The following table is a listing of the individual investments in SLP I's portfolio as of March 31, 2021:
Portfolio Company and Type of InvestmentIndustryInterest Rate (1)Maturity Date Principal Amount or Par Value CostFair
Value (2)
Funded Investments - First lien(in thousands)(in thousands)(in thousands)
Access CIG, LLCBusiness Services 3.87% (L + 3.75%) 2/27/2025$3,669 $3,692 $3,648 
Advisor Group Holdings, Inc.Consumer Services 4.61% (L + 4.50%) 7/31/20266,849 6,794 6,852 
Affordable Care Holding Corp.Healthcare Services 5.75% (L + 4.75%) 10/24/20226,596 6,565 6,497 
ASG Technologies Group, Inc. Software 4.50% (L + 3.50%) 7/31/2024651 649 643 
BarBri, Inc.Education 5.00% (L + 4.00%) 12/1/20235,980 5,965 5,920 
Bearcat Buyer, Inc.Healthcare Services 5.25% (L + 4.25%) 7/9/2026130 130 130 
Bearcat Buyer, Inc.Healthcare Services 5.25% (L + 4.25%) 7/9/2026629 627 629 
Bracket Intermediate Holding Corp.Healthcare Services 4.49% (L + 4.25%) 9/5/20254,508 4,493 4,502 
Certara Holdco, Inc.Healthcare Information Technology 3.70% (L + 3.50%) 8/15/20245,125 5,121 5,125 
CHA Holdings, Inc.Business Services 5.50% (L + 4.50%) 4/10/2025451 451 421 
Cvent, Inc.Software 3.90% (L + 3.75%) 11/29/20246,727 6,716 6,574 
Dealer Tire, LLCDistribution & Logistics 4.36% (L + 4.25%) 12/12/20253,424 3,417 3,434 
Drilling Info Holdings, Inc.Business Services 4.36% (L + 4.25%) 7/30/20256,088 6,070 5,996 
Emerald 2 LimitedBusiness Services 3.61% (L + 3.50%) 7/10/2026447 447 445 
eResearchTechnology, Inc.Healthcare Services 5.50% (L + 4.50%) 2/4/20271,342 1,331 1,345 
Fastlane Parent Company, Inc.Distribution & Logistics 4.61% (L + 4.50%) 2/4/20261,359 1,339 1,359 
Greenway Health, LLCSoftware 4.75% (L + 3.75%) 2/16/20246,675 6,660 6,383 
Heartland Dental, LLCHealthcare Services 3.61% (L + 3.50%) 4/30/20253,600 3,589 3,549 
Help/Systems Holdings, Inc.Software 5.75% (L + 4.75%) 11/19/2026137 137 138 
LSCS Holdings, Inc.Healthcare Services 4.51% (L + 4.25%) 3/17/20251,368 1,364 1,355 
LSCS Holdings, Inc.Healthcare Services 4.51% (L + 4.25%) 3/17/20255,301 5,285 5,248 
Market Track, LLCBusiness Services 5.25% (L + 4.25%) 6/5/2024779 781 779 
Medical Solutions Holdings, Inc.Healthcare Services 5.50% (L + 4.50%) 6/14/20242,243 2,240 2,247 
Ministry Brands, LLCSoftware 5.00% (L + 4.00%) 12/2/20224,863 4,856 4,850 
National Intergovernmental Purchasing Alliance CompanyBusiness Services 3.95% (L + 3.75%) 5/23/20251,349 1,350 1,346 
Pelican Products, Inc.Business Products 4.50% (L + 3.50%) 5/1/20252,248 2,244 2,227 
Premise Health Holding Corp.Healthcare Services 3.70% (L + 3.50%) 7/10/2025627 624 624 
Project Accelerate Parent, LLCBusiness Services 5.25% (L + 4.25%) 1/2/20254,164 4,149 4,015 
PSC Industrial Holdings Corp.Industrial Services 4.75% (L + 3.75%) 10/11/20243,896 3,875 3,815 
Salient CRGT Inc.Federal Services 7.50% (L + 6.50%) 2/28/20226,731 6,717 6,731 
Sierra Enterprises, LLCFood & Beverage 5.00% (L + 4.00%) 11/11/20244,249 4,233 4,195 
Wirepath LLCDistribution & Logistics 4.20% (L + 4.00%) 8/5/20246,762 6,762 6,661 
WP CityMD Bidco LLCHealthcare Services 4.50% (L + 3.75%) 8/13/20266,133 6,083 6,132 
Wrench Group LLCConsumer Services 4.20% (L + 4.00%) 4/30/20262,734 2,712 2,734 
YI, LLCHealthcare Services 5.00% (L + 4.00%) 11/7/20247,778 7,771 7,564 
Zelis Cost Management Buyer, Inc.Healthcare Information Technology 3.62% (L + 3.50%) 9/30/20261,754 1,739 1,748 
Total Funded Investments$127,366 $126,978 $125,861 
(1)All interest is payable in cash unless otherwise indicated. A majority of the variable rate debt investments bear interest at a rate that may be determined by reference to the LIBOR (L), the Prime Rate (P) and the alternative base rate (Base). For each investment, the current interest rate provided reflects the rate in effect as of March 31, 2021.
(2)Represents the fair value in accordance with Accounting Standards Codification Topic 820, Fair Value Measurement and Disclosures ("ASC 820"). Our board of directors does not determine the fair value of the investments held by SLP I.

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The following table is a listing of the individual investments in SLP I's portfolio as of December 31, 2020:
Portfolio Company and Type of InvestmentIndustryInterest Rate (1)Maturity Date Principal Amount or Par Value CostFair
Value (2)
Funded Investments - First lien(in thousands)(in thousands)(in thousands)
Access CIG, LLCBusiness Services 3.98% (L + 3.75%) 2/27/2025$3,678 $3,701 $3,649 
Advisor Group Holdings, Inc.Consumer Services 5.15% (L + 5.00%) 7/31/20266,866 6,809 6,836 
Affordable Care Holding Corp.Healthcare Services 5.75% (L + 4.75%) 10/24/20226,614 6,578 6,531 
ASG Technologies Group, Inc. Software 4.50% (L + 3.50%) 7/31/2024653 651 636 
BarBri, Inc.Education 5.00% (L + 4.00%) 12/1/20235,980 5,964 5,980 
Bearcat Buyer, Inc.Healthcare Services 5.25% (L + 4.25%) 7/9/2026131 130 131 
Bearcat Buyer, Inc.Healthcare Services 5.25% (L + 4.25%) 7/9/2026631 628 631 
Bracket Intermediate Holding Corp.Healthcare Services 4.48% (L + 4.25%) 9/5/20254,520 4,504 4,474 
Certara Holdco, Inc.Healthcare Information Technology 3.75% (L + 3.50%) 8/15/20245,138 5,134 5,145 
CHA Holdings, Inc.Business Services 5.50% (L + 4.50%) 4/10/2025452 452 423 
Cvent, Inc.Software 3.90% (L + 3.75%) 11/29/20246,745 6,732 6,479 
Dealer Tire, LLCDistribution & Logistics 4.40% (L + 4.25%) 12/12/20253,433 3,426 3,419 
Drilling Info Holdings, Inc.Business Services 4.40% (L + 4.25%) 7/30/20256,103 6,084 5,925 
Emerald 2 LimitedBusiness Services 3.50% (L + 3.25%) 7/10/2026449 448 445 
eResearchTechnology, Inc.Healthcare Services 5.50% (L + 4.50%) 2/4/20271,345 1,333 1,336 
Fastlane Parent Company, Inc.Distribution & Logistics 4.65% (L + 4.50%) 2/4/20261,363 1,342 1,355 
Greenway Health, LLCSoftware 4.75% (L + 3.75%) 2/16/20246,693 6,677 6,141 
Heartland Dental, LLCHealthcare Services 3.65% (L + 3.50%) 4/30/20253,609 3,597 3,524 
HS Purchaser, LLC / Help/Systems Holdings, Inc.Software 5.75% (L + 4.75%) 11/19/2026138 137 138 
LSCS Holdings, Inc.Healthcare Services 4.51% (L + 4.25%) 3/17/20251,372 1,367 1,344 
LSCS Holdings, Inc.Healthcare Services 4.51% (L + 4.25%) 3/17/20255,314 5,297 5,208 
Market Track, LLCBusiness Services 5.25% (L + 4.25%) 6/5/2024781 783 767 
Medical Solutions Holdings, Inc.Healthcare Services 5.50% (L + 4.50%) 6/14/20242,249 2,245 2,237 
Ministry Brands, LLCSoftware 5.00% (L + 4.00%) 12/2/20224,876 4,868 4,852 
National Intergovernmental Purchasing Alliance CompanyBusiness Services 4.00% (L + 3.75%) 5/23/20251,352 1,354 1,346 
Pelican Products, Inc.Business Products 4.50% (L + 3.50%) 5/1/20252,254 2,250 2,217 
Premise Health Holding Corp.Healthcare Services 3.75% (L + 3.50%) 7/10/2025628 626 614 
Project Accelerate Parent, LLCBusiness Services 5.25% (L + 4.25%) 1/2/20254,175 4,159 3,799 
PSC Industrial Holdings Corp.Industrial Services 4.75% (L + 3.75%) 10/11/20243,906 3,883 3,799 
Salient CRGT Inc.Federal Services 7.50% (L + 6.50%) 2/28/20226,731 6,713 6,731 
Sierra Enterprises, LLCFood & Beverage 5.00% (L + 4.00%) 11/11/20244,260 4,243 4,192 
Wirepath LLCDistribution & Logistics 4.25% (L + 4.00%) 8/5/20246,779 6,779 6,542 
WP CityMD Bidco LLCHealthcare Services 5.50% (L + 4.50%) 8/13/20266,148 6,096 6,162 
Wrench Group LLCConsumer Services 4.25% (L + 4.00%) 4/30/20262,739 2,716 2,712 
YI, LLCHealthcare Services 5.00% (L + 4.00%) 11/7/20247,797 7,792 7,174 
Zelis Cost Management Buyer, Inc.Healthcare Information Technology 4.90% (L + 4.75%) 9/30/20261,758 1,743 1,765 
Total Funded Investments$127,660 $127,241 $124,659 
(1)All interest is payable in cash unless otherwise indicated. A majority of the variable rate debt investments bear interest at a rate that may be determined by reference to the LIBOR (L), the Prime Rate (P) and the alternative base rate (Base). For each investment, the current interest rate provided reflects the rate in effect as of December 31, 2020.
(2)Represents the fair value in accordance with ASC 820. Our board of directors does not determine the fair value of the investments held by SLP I.


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Below is certain summarized financial information for SLP I as of March 31, 2021 and December 31, 2020 and for the three months ended March 31, 2021 and March 31, 2020:

Selected Balance Sheet Information:March 31, 2021December 31, 2020
(in thousands)(in thousands)
Investments at fair value (cost of $126,978 and $127,241, respectively)$125,861 $124,659 
Receivable from in-kind distributions— 100,404 
Receivable from unsettled securities sold— 1,662 
Cash and other assets6,308 6,461 
Total assets$132,169 $233,186 
Credit facility$88,567 $188,867 
Deferred financing costs(233)(296)
Distribution payable1,075 2,538 
Other liabilities689 1,364 
Total liabilities90,098 192,473 
Members' capital$42,071 $40,713 
Total liabilities and members' capital$132,169 $233,186 

Three Months Ended
Selected Statement of Operations Information:March 31, 2021March 31, 2020
(in thousands)(in thousands)
Interest income$1,966 $5,122 
Other income11 39 
Total investment income1,977 5,161 
Interest and other financing expenses471 1,954 
Other expenses539 398 
Total expenses1,010 2,352 
Less: expenses waived and reimbursed— (56)
Net expenses1,010 2,296 
Net investment income967 2,865 
Net realized gains on investments45 
Net change in unrealized appreciation (depreciation) of investments1,465 (39,060)
Net increase (decrease) in members' capital $2,433 $(36,150)
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Pursuant to the Restated SLP I Agreement, the Company is no longer entitled to, and SLP I no longer pays management fees for investment management services provided to SLP I. For the three months ended March 31, 2021 and March 31, 2020, we earned approximately $0.0 million and $0.3 million, respectively, in management fees related to SLP I, which is included in other income. As of March 31, 2021 and December 31, 2020, approximately $0.0 million and $0.1 million, respectively, of management fees related to SLP I was included in receivable from affiliates. For the three months ended March 31, 2021 and March 31, 2020, we earned approximately $0.6 million and $0.7 million, respectively, of dividend income related to SLP I, which is included in dividend income. As of March 31, 2021 and December 31, 2020, approximately $0.6 million and $0.7 million, respectively, of dividend income related to SLP I was included in interest and dividend receivable.
We have determined that SLP I is an investment company under ASC 946; however, in accordance with such guidance we will generally not consolidate its investment in a company other than a wholly-owned investment company subsidiary. Furthermore, Accounting Standards Codification Topic 810, Consolidation ("ASC 810"), concludes that in an investment fund where all members have equal decision making authority, it is not appropriate for one member to consolidate since neither has control. Accordingly, we do not consolidate SLP I.
NMFC Senior Loan Program II LLC
    NMFC Senior Loan Program II LLC ("SLP II") was formed as a Delaware limited liability company on March 9, 2016 and commenced operations on April 12, 2016. SLP II is structured as a private joint venture investment fund between us and SkyKnight Income, LLC (“SkyKnight”) and operates under a limited liability company agreement (the "SLP II Agreement"). The purpose of the joint venture is to invest primarily in senior secured loans issued by portfolio companies within our core industry verticals. These investments are typically broadly syndicated first lien loans. All investment decisions must be unanimously approved by the board of managers of SLP II, which has equal representation from us and SkyKnight. SLP II's investment period ended on April 12, 2020 and SLP II will continue in existence until April 12, 2022. The term may be extended for up to one year pursuant to certain terms of the SLP II Agreement.
    SLP II is capitalized with equity contributions which were called from its members, on a pro-rata basis based on their equity commitments, as transactions are completed. Any decision by SLP II to call down on capital commitments requires approval by the board of managers of SLP II. As of March 31, 2021, we and SkyKnight have committed and contributed $79.4 million and $20.6 million, respectively, of equity to SLP II. Our investment in SLP II is disclosed on our Consolidated Schedule of Investments as of March 31, 2021 and December 31, 2020.    
On April 12, 2016, SLP II entered into its revolving credit facility with Wells Fargo Bank, National Association, which matures on April 12, 2022 and bears interest at a rate of the LIBOR plus 1.60% per annum. As of March 31, 2021 and December 31, 2020, SLP II had total investments with an aggregate fair value of approximately $250.9 million and $271.1 million, respectively, and debt outstanding under its credit facility of $160.7 million and $184.0 million, respectively. As of March 31, 2021 and December 31, 2020, none of SLP II's investments were on non-accrual.
Below is a summary of SLP II's portfolio, along with a listing of the individual investments in SLP II's portfolio as of March 31, 2021 and December 31, 2020:
(in thousands)March 31, 2021December 31, 2020
First lien investments (1)$255,235 $279,678 
Weighted average interest rate on first lien investments (2)4.95 %5.07 %
Number of portfolio companies in SLP II30 32 
Largest portfolio company investment (1)$16,501 $16,481 
Total of five largest portfolio company investments (1)$75,392 $75,522 
(1)Reflects principal amount or par value of investments.
(2)Computed as the all in interest rate in effect on accruing investments divided by the total principal amount of investments.

    
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The following table is a listing of the individual investments in SLP II's portfolio as of March 31, 2021:
Portfolio Company and Type of InvestmentIndustryInterest Rate (1)Maturity Date Principal Amount or Par Value CostFair
Value (2)
Funded Investments - First lien:(in thousands)(in thousands)(in thousands)
Access CIG, LLCBusiness Services 3.87% (L + 3.75%) 2/27/2025$4,601 $4,587 $4,575 
ADG, LLCHealthcare Services 6.25 % (L + 4.75% + 0.50% PIK) 9/28/202316,501 16,436 15,939 
Advisor Group Holdings, Inc.Consumer Services 4.61% (L + 4.50%) 7/31/20264,938 4,898 4,940 
Bearcat Buyer, Inc.Healthcare Services 5.25% (L + 4.25%) 7/9/2026282 281 282 
Bearcat Buyer, Inc.Healthcare Services 5.25% (L + 4.25%) 7/9/20261,361 1,356 1,361 
Bleriot US Bidco Inc.Federal Services 4.20% (L + 4.00%) 10/30/20269,900 9,817 9,888 
Brave Parent Holdings, Inc. Software 4.11% (L + 4.00%) 4/18/20253,643 3,634 3,646 
CentralSquare Technologies, LLCSoftware 3.95% (L + 3.75%) 8/29/202514,663 14,638 14,069 
CHA Holdings, Inc.Business Services 5.50% (L + 4.50%) 4/10/20252,021 2,014 1,890 
CHA Holdings, Inc.Business Services 5.50% (L + 4.50%) 4/10/202510,561 10,531 9,874 
Dealer Tire, LLCDistribution & Logistics 4.36% (L + 4.25%) 12/12/20257,406 7,391 7,428 
Drilling Info Holdings, Inc.Business Services 4.36% (L + 4.25%) 7/30/202514,571 14,528 14,352 
Edgewood Partners Holdings LLC (EPIC)Business Services 5.25% (L + 4.25%) 9/6/20247,337 7,289 7,264 
eResearchTechnology, Inc.Healthcare Services 5.50% (L + 4.50%) 2/4/20273,121 3,094 3,128 
Fastlane Parent Company, Inc.Distribution & Logistics 4.61% (L + 4.50%) 2/4/20263,430 3,380 3,428 
Greenway Health, LLCSoftware 4.75% (L + 3.75%) 2/16/202414,438 14,404 13,806 
Help/Systems Holdings, Inc.Software 5.75% (L + 4.75%) 11/19/20264,400 4,363 4,432 
Keystone Acquisition Corp.Healthcare Services 6.25% (L + 5.25%) 5/1/20245,211 5,185 5,028 
LSCS Holdings, Inc.Healthcare Services 4.51% (L + 4.25%) 3/17/20251,860 1,859 1,842 
LSCS Holdings, Inc.Healthcare Services 4.51% (L + 4.25%) 3/17/20257,206 7,201 7,134 
Market Track, LLCBusiness Services 5.25% (L + 4.25%) 6/5/202411,550 11,521 11,550 
Medical Solutions Holdings, Inc.Healthcare Services 5.50% (L + 4.50%) 6/14/20242,760 2,753 2,765 
Ministry Brands, LLCSoftware 5.00% (L + 4.00%) 12/2/20222,068 2,064 2,062 
Ministry Brands, LLCSoftware 5.00% (L + 4.00%) 12/2/2022869 867 866 
Ministry Brands, LLCSoftware 5.00% (L + 4.00%) 12/2/202212,003 11,983 11,969 
Premise Health Holding Corp.Healthcare Services 3.70% (L + 3.50%) 7/10/20251,355 1,350 1,346 
Project Accelerate Parent, LLCBusiness Services 5.25% (L + 4.25%) 1/2/202512,386 12,349 11,942 
PSC Industrial Holdings Corp.Industrial Services 4.75% (L + 3.75%) 10/11/20243,021 3,004 2,958 
Quest Software US Holdings Inc.Software 4.46% (L + 4.25%) 5/16/202514,663 14,616 14,678 
Salient CRGT Inc.Federal Services 7.50% (L + 6.50%) 2/28/202212,478 12,451 12,478 
Wirepath LLCDistribution & Logistics 4.20% (L + 4.00%) 8/5/202414,625 14,625 14,406 
WP CityMD Bidco LLCHealthcare Services 4.50% (L + 3.75%) 8/13/20265,404 5,361 5,404 
Wrench Group LLCConsumer Services 4.20% (L + 4.00%) 4/30/20265,913 5,866 5,913 
YI, LLCHealthcare Services 5.00% (L + 4.00%) 11/7/202414,611 14,604 14,209 
Zelis Cost Management Buyer, Inc.Healthcare Information Technology 3.62% (L + 3.50%) 9/30/20264,078 4,044 4,065 
Total Funded Investments$255,235 $254,344 $250,917 
(1)All interest is payable in cash unless otherwise indicated. A majority of the variable rate debt investments bear interest at a rate that may be determined by reference to the LIBOR (L), the Prime Rate (P) and the alternative base rate (Base). For each investment, the current interest rate provided reflects the rate in effect as of March 31, 2021.
(2)Represents the fair value in accordance with ASC 820. Our board of directors does not determine the fair value of the investments held by SLP II.
        

104

The following table is a listing of the individual investments in SLP II's portfolio as of December 31, 2020:
Portfolio Company and Type of InvestmentIndustryInterest Rate (1)Maturity Date Principal Amount or Par Value CostFair
Value (2)
Funded Investments - First lien(in thousands)(in thousands)(in thousands)
Access CIG, LLCBusiness Services3.98% (L + 3.75%)2/27/2025$4,613 $4,598 $4,577 
ADG, LLCHealthcare Services6.25 % (L + 4.75% + 0.50% PIK)9/28/202316,481 16,410 15,612 
Advisor Group Holdings, Inc.Consumer Services5.15% (L + 5.00%)7/31/20264,950 4,909 4,928 
Bearcat Buyer, Inc.Healthcare Services5.25% (L + 4.25%)7/9/2026283 282 283 
Bearcat Buyer, Inc.Healthcare Services5.25% (L + 4.25%)7/9/20261,365 1,359 1,365 
Bleriot US Bidco Inc.Federal Services5.00% (L + 4.75%)10/31/20261,341 1,329 1,341 
Bleriot US Bidco Inc.Federal Services5.00% (L + 4.75%)10/30/20268,584 8,509 8,584 
Brave Parent Holdings, Inc.Software4.15% (L + 4.00%)4/18/20253,652 3,643 3,630 
CentralSquare Technologies, LLCSoftware4.00% (L + 3.75%)8/29/202514,700 14,674 13,745 
CHA Holdings, Inc.Business Services5.50% (L + 4.50%)4/10/20252,026 2,019 1,895 
CHA Holdings, Inc.Business Services5.50% (L + 4.50%)4/10/202510,588 10,556 9,900 
Dealer Tire, LLCDistribution & Logistics4.40% (L + 4.25%)12/12/20257,425 7,409 7,394 
Drilling Info Holdings, Inc.Business Services4.40% (L + 4.25%)7/30/202514,608 14,563 14,182 
Edgewood Partners Holdings LLC (EPIC)Business Services5.25% (L + 4.25%)9/6/20247,356 7,304 7,301 
eResearchTechnology, Inc.Healthcare Services5.50% (L + 4.50%)2/4/20273,129 3,101 3,106 
Fastlane Parent Company, Inc.Distribution & Logistics4.65% (L + 4.50%)2/4/20263,439 3,386 3,419 
Greenway Health, LLCSoftware4.75% (L + 3.75%)2/16/202414,475 14,439 13,281 
HS Purchaser, LLC / Help/Systems Holdings, Inc.Software5.75% (L + 4.75%)11/19/20264,411 4,373 4,411 
Institutional Shareholder Services Inc.Business Services4.75% (L + 4.50%)3/5/202613,755 13,648 13,600 
Keystone Acquisition Corp.Healthcare Services6.25% (L + 5.25%)5/1/20245,225 5,196 4,937 
LSCS Holdings, Inc.Healthcare Services4.51% (L + 4.25%)3/17/20251,865 1,863 1,828 
LSCS Holdings, Inc.Healthcare Services4.51% (L + 4.25%)3/17/20257,225 7,219 7,080 
Market Track, LLCBusiness Services5.25% (L + 4.25%)6/5/202411,580 11,549 11,376 
Medical Solutions Holdings, Inc.Healthcare Services5.50% (L + 4.50%)6/14/20242,767 2,760 2,753 
Ministry Brands, LLCSoftware5.00% (L + 4.00%)12/2/20222,073 2,069 2,063 
Ministry Brands, LLCSoftware5.00% (L + 4.00%)12/2/2022871 869 867 
Ministry Brands, LLCSoftware5.00% (L + 4.00%)12/2/202212,034 12,011 11,975 
Peraton Corp. (fka MHVC Acquisition Corp.)Federal Services6.25% (L + 5.25%)4/29/202410,133 10,105 10,158 
Premise Health Holding Corp.Healthcare Services3.75% (L + 3.50%)7/10/20251,358 1,354 1,328 
Project Accelerate Parent, LLCBusiness Services5.25% (L + 4.25%)1/2/202512,418 12,379 11,300 
PSC Industrial Holdings Corp.Industrial Services4.75% (L + 3.75%)10/11/20243,028 3,011 2,945 
Quest Software US Holdings Inc.Software4.46% (L + 4.25%)5/16/202514,700 14,650 14,480 
Salient CRGT Inc.Federal Services7.50% (L + 6.50%)2/28/202212,478 12,445 12,478 
Wirepath LLCDistribution & Logistics4.25% (L + 4.00%)8/5/202414,663 14,663 14,149 
WP CityMD Bidco LLCHealthcare Services5.50% (L + 4.50%)8/13/20265,418 5,372 5,431 
Wrench Group LLCConsumer Services4.25% (L + 4.00%)4/30/20265,924 5,875 5,865 
YI, LLCHealthcare Services5.00% (L + 4.00%)11/7/202414,649 14,641 13,477 
Zelis Cost Management Buyer, Inc.Healthcare Information Technology4.90% (L + 4.75%)9/30/20264,088 4,053 4,105 
Total Funded Investments$279,678 $278,595 $271,149 
(1)All interest is payable in cash unless otherwise indicated. A majority of the variable rate debt investments bear interest at a rate that may be determined by reference to the LIBOR (L), the Prime Rate (P) and the alternative base rate (Base). For each investment, the current interest rate provided reflects the rate in effect as of December 31, 2020.
(2)Represents the fair value in accordance with ASC 820. Our board of directors does not determine the fair value of the investments held by SLP II.


105

    Below is certain summarized financial information for SLP II as of March 31, 2021 and December 31, 2020 and for the three months ended March 31, 2021 and March 31, 2020:
Selected Balance Sheet Information:March 31, 2021December 31, 2020
(in thousands)(in thousands)
Investments at fair value (cost of $254,344 and $278,595, respectively)$250,917 $271,149 
Cash and other assets9,724 8,759 
Total assets$260,641 $279,908 
Credit facility$160,670 $183,970 
Deferred financing costs(315)(534)
Distribution payable2,500 2,500 
Other liabilities904 1,058 
Total liabilities163,759 186,994 
Members' capital$96,882 $92,914 
Total liabilities and members' capital$260,641 $279,908 
Three Months Ended
Selected Statement of Operations Information:March 31, 2021March 31, 2020
(in thousands)(in thousands)
Interest income$3,534 $5,447 
Other income— 53 
Total investment income3,534 5,500 
Interest and other financing expenses980 2,145 
Other expenses107 132 
Total expenses1,087 2,277 
Net investment income2,447 3,223 
Net realized gains on investments56 
Net change in unrealized appreciation (depreciation) of investments4,019 (34,801)
Net increase (decrease) in members' capital $6,468 $(31,522)
    For the three months ended March 31, 2021 and March 31, 2020, we earned approximately $2.0 million and $2.6 million, respectively, of dividend income related to SLP II, which is included in dividend income. As of March 31, 2021 and December 31, 2020, approximately $2.0 million and $2.0 million, respectively, of dividend income related to SLP II was included in interest and dividend receivable.
    We have determined that SLP II is an investment company under ASC 946; however, in accordance with such guidance we will generally not consolidate our investment in a company other than a wholly-owned investment company subsidiary. Furthermore, ASC 810, concludes that in a joint venture where both members have equal decision making authority, it is not appropriate for one member to consolidate the joint venture since neither has control. Accordingly, we do not consolidate SLP II.
NMFC Senior Loan Program III LLC
    NMFC Senior Loan Program III LLC ("SLP III") was formed as a Delaware limited liability company and commenced operations on April 25, 2018. SLP III is structured as a private joint venture investment fund between us and SkyKnight Income II, LLC (“SkyKnight II”) and operates under a limited liability company agreement (the "SLP III Agreement"). The purpose of the joint venture is to invest primarily in senior secured loans issued by portfolio companies within our core industry verticals. These investments are typically broadly syndicated first lien loans. All investment decisions must be unanimously approved by the board of managers of SLP III, which has equal representation from us and SkyKnight II. SLP III has a five year investment period and will continue in existence until April 25, 2025. The investment period may be extended for up to one year pursuant to certain terms of the SLP III Agreement.
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SLP III is capitalized with equity contributions which are called from its members, on a pro-rata basis based on their equity commitments, as transactions are completed. Any decision by SLP III to call down on capital commitments requires approval by the board of managers of SLP III. As of March 31, 2021, we and SkyKnight II have committed $140.0 million and $35.0 million, respectively, of equity to SLP III. As of March 31, 2021, we and SkyKnight II have contributed $130.0 million and $32.5 million, respectively, of equity to SLP III. Our investment in SLP III is disclosed on our Consolidated Schedule of Investments as of March 31, 2021 and December 31, 2020.
    On May 2, 2018, SLP III entered into its revolving credit facility with Citibank, N.A., which matures on May 2, 2023 and bears interest at a rate of LIBOR plus 1.70% per annum. Effective February 13, 2020, SLP III's revolving credit facility has a maximum borrowing capacity of $525.0 million. As of March 31, 2021 and December 31, 2020, SLP III had total investments with an aggregate fair value of approximately $666.6 million and $610.0 million, respectively, and debt outstanding under its credit facility of $474.2 million and $424.2 million, respectively. As of March 31, 2021 and December 31, 2020, none of SLP III's investments were on non-accrual. Additionally, as of March 31, 2021 and December 31, 2020, SLP III had unfunded commitments in the form of delayed draws of $15.1 million and $7.8 million, respectively.
Below is a summary of SLP III's portfolio, along with a listing of the individual investments in SLP III's portfolio as of March 31, 2021 and December 31, 2020:    
(in thousands)March 31, 2021December 31, 2020
First lien investments (1)$686,095 $626,985 
Weighted average interest rate on first lien investments (2)4.57 %4.72 %
Number of portfolio companies in SLP III71 69 
Largest portfolio company investment (1)$23,668 $23,735 
Total of five largest portfolio company investments (1)$98,902 $99,159 
(1)Reflects principal amount or par value of investment.
(2)Computed as the all in interest rate in effect on accruing investments divided by the total principal amount of investments.
107

    The following table is a listing of the individual investments in SLP III's portfolio as of March 31, 2021:
Portfolio Company and Type of InvestmentIndustryInterest Rate (1)Maturity Date Principal Amount or Par Value CostFair
Value (2)
Funded Investments - First lien( in thousands)( in thousands)( in thousands)
Access CIG, LLCBusiness Services 3.87% (L + 3.75%) 2/27/2025$865 $865 $860 
Advisor Group Holdings, Inc.Consumer Services 4.61% (L + 4.50%) 7/31/20269,875 9,835 9,880 
Affordable Care Holding Corp.Healthcare Services 5.75% (L + 4.75%) 10/24/20225,885 5,841 5,797 
AG Parent Holdings, LLCHealthcare Services 5.11% (L + 5.00%) 7/31/202612,344 12,294 12,297 
Ascensus Specialties LLCSpecialty Chemicals & Materials 4.87% (L + 4.75%) 9/24/20269,875 9,835 9,986 
Aston FinCo S.a.r.l. / Aston US Finco, LLCSoftware 4.36% (L + 4.25%) 10/9/20265,940 5,891 5,918 
Astra Acquisition Corp.Software 5.50% (L + 4.75%) 3/1/202716,490 16,415 16,614 
BCPE Empire Holdings, Inc.Distribution & Logistics 4.11% (L + 4.00%) 6/11/202610,842 10,756 10,801 
Bearcat Buyer, Inc.Healthcare Services 5.25% (L + 4.25%) 7/9/202619,604 19,527 19,604 
Bearcat Buyer, Inc.Healthcare Services 5.25% (L + 4.25%) 7/9/20264,064 4,046 4,064 
Bleriot US Bidco Inc.Federal Services 4.20% (L + 4.00%) 10/31/20264,950 4,907 4,944 
Bluefin Holding, LLCSoftware 4.11% (L + 4.00%) 9/4/20269,875 9,755 9,875 
Bracket Intermediate Holding Corp.Healthcare Services 4.49% (L + 4.25%) 9/5/202514,625 14,575 14,607 
Brave Parent Holdings, Inc.Software 4.11% (L + 4.00%) 4/18/202511,188 11,163 11,197 
Cano Health, LLCHealthcare Services 5.50% (L + 4.75%) 11/23/20276,291 6,231 6,298 
Cardinal Parent, Inc.Software 5.25% (L + 4.50%) 11/12/20277,037 6,935 7,077 
CentralSquare Technologies, LLCSoftware 3.95% (L + 3.75%) 8/29/202514,662 14,638 14,069 
Certara Holdco, Inc.Healthcare Information Technology 3.70% (L + 3.50%) 8/15/20241,242 1,245 1,242 
CHA Holdings, Inc.Business Services 5.50% (L + 4.50%) 4/10/2025975 975 912 
CommerceHub, Inc.Software 4.75% (L + 4.00%) 12/29/20275,819 5,790 5,833 
Confluent Health, LLCHealthcare Services 5.11% (L + 5.00%) 6/24/20264,387 4,345 4,387 
Covenant Surgical Partners, Inc.Healthcare Services 4.11% (L + 4.00%) 7/1/20269,851 9,774 9,642 
CRCI Longhorn Holdings, Inc.Business Services 3.61% (L + 3.50%) 8/8/202514,625 14,577 14,399 
Dealer Tire, LLCDistribution & Logistics 4.36% (L + 4.25%) 12/12/20259,875 9,855 9,904 
Dentalcorp Health Services ULC (fka Dentalcorp Perfect Smile ULC)Healthcare Services 4.75% (L + 3.75%) 6/6/202516,842 16,797 16,737 
DG Investment Intermediate Holdings 2, Inc.Business Services 4.50% (L + 3.75%) 3/31/20286,201 6,170 6,174 
DG Investment Intermediate Holdings 2, Inc.Business Services 4.50% (L + 3.75%) 3/31/2028500 500 498 
Dispatch Acquisition Holdings, LLCIndustrial Services 5.00% (L + 4.25%) 3/25/20284,179 4,137 4,171 
Drilling Info Holdings, Inc.Business Services 4.36% (L + 4.25%) 7/30/202518,529 18,467 18,251 
Edgewood Partners Holdings LLCBusiness Services 5.25% (L + 4.25%) 9/6/20247,337 7,289 7,264 
eResearchTechnology, Inc.Healthcare Services 5.50% (L + 4.50%) 2/4/20277,393 7,359 7,408 
EyeCare Partners, LLCHealthcare Services 3.86% (L + 3.75%) 2/18/202714,872 14,855 14,737 
Frontline Technologies Intermediate Holdings, LLCSoftware 6.75% (L + 5.75%) 9/18/20236,497 6,497 6,497 
Greenway Health, LLCSoftware 4.75% (L + 3.75%) 2/16/202414,482 14,488 13,849 
Heartland Dental, LLCHealthcare Services 3.61% (L + 3.50%) 4/30/202518,493 18,434 18,228 
Help/Systems Holdings, Inc.Software 5.75% (L + 4.75%) 11/19/202618,394 18,231 18,526 
Higginbotham Insurance Agency, Inc.Financial Services 6.50% (L + 5.75%) 11/25/20267,187 7,136 7,331 
Idera, Inc.Software 4.50% (L + 3.75%) 3/2/202816,085 16,070 16,004 
Kestra Advisor Services Holdings A, Inc.Business Services 4.36% (L + 4.25%) 6/3/202612,150 12,083 12,120 
LI Group Holdings, Inc.Software 4.50% (L + 3.75%) 3/11/20284,655 4,643 4,672 
LSCS Holdings, Inc.Healthcare Services 4.51% (L + 4.25%) 3/17/20252,621 2,606 2,594 
LSCS Holdings, Inc.Healthcare Services 4.51% (L + 4.25%) 3/17/2025676 673 670 
Maravai Intermediate Holdings, LLCSpecialty Chemicals & Materials 5.25% (L + 4.25%) 10/19/20274,114 4,075 4,132 
Market Track, LLCBusiness Services 5.25% (L + 4.25%) 6/5/20246,129 6,062 6,129 
MED ParentCo, LPHealthcare Services 4.36% (L + 4.25%) 8/31/202610,246 10,169 10,172 
MED ParentCo, LPHealthcare Services 4.36% (L + 4.25%) 8/31/20262,570 2,548 2,551 
Ministry Brands, LLCSoftware 5.00% (L + 4.00%) 12/2/20224,490 4,481 4,478 
Ministry Brands, LLCSoftware 5.00% (L + 4.00%) 12/2/2022869 867 866 
National Intergovernmental Purchasing Alliance CompanyBusiness Services 3.95% (L + 3.75%) 5/23/20258,679 8,676 8,657 
Navex Topco, Inc.Software 3.36% (L + 3.25%) 9/5/202518,162 18,038 18,048 
108

Portfolio Company and Type of InvestmentIndustryInterest Rate (1)Maturity Date Principal Amount or Par Value CostFair
Value (2)
Newport Group Holdings II, Inc.Business Services 3.70% (L + 3.50%) 9/12/2025$4,875 $4,859 $4,851 
Orion Advisor Solutions, Inc.Business Services 4.50% (L + 3.75%) 9/24/20275,237 5,188 5,234 
Outcomes Group Holdings, Inc.Healthcare Services 3.45% (L + 3.25%) 10/24/20253,392 3,386 3,358 
Pelican Products, Inc.Business Products 4.50% (L + 3.50%) 5/1/20254,863 4,855 4,817 
Peraton Corp.Federal Services 4.50% (L + 3.75%) 2/1/20284,529 4,507 4,531 
PetVet Care Centers, LLC (fka Pearl Intermediate Parent LLC)Consumer Services 4.25% (L + 3.50%) 2/14/20254,506 4,506 4,502 
Planview Parent, Inc.Software 4.75% (L + 4.00%) 12/17/20277,979 7,901 7,994 
Premise Health Holding Corp.Healthcare Services 3.70% (L + 3.50%) 7/10/202513,550 13,505 13,465 
Project Accelerate Parent, LLCBusiness Services 5.25% (L + 4.25%) 1/2/20259,798 9,763 9,447 
Project Boost Purchaser, LLCBusiness Services 5.00% (L + 4.25%) 6/1/20261,990 1,971 1,991 
Project Ruby Ultimate Parent Corp. (Mediware)Healthcare I.T. 4.00% (L + 3.25%) 3/10/202814,000 13,930 13,959 
Quest Software US Holdings Inc.Software 4.46% (L + 4.25%) 5/16/202514,662 14,616 14,678 
RealPage, Inc.Business Services 3.75% (L + 3.25%) 4/24/202814,000 13,965 13,950 
Sierra Enterprises, LLCFood & Beverage 5.00% (L + 4.00%) 11/11/20242,425 2,423 2,395 
Sovos Brands Intermediate, Inc.Food & Beverage 4.98% (L + 4.75%) 11/20/20253,582 3,573 3,600 
Spring Education Group, Inc. (fka SSH Group Holdings, Inc.)Education 4.45% (L + 4.25%) 7/30/202512,152 12,131 11,632 
Storable, IncSoftware 3.75% (L + 3.25%) 2/26/20283,862 3,852 3,833 
Symplr Software, Inc.(fka Caliper Software, Inc.)Healthcare I.T. 5.25% (L + 4.50%) 12/22/202716,000 15,854 16,072 
Syndigo LLCSoftware 5.25% (L + 4.50%) 12/15/202715,000 14,891 14,888 
TIBCO Software Inc.Software 3.86% (L + 3.75%) 6/30/20267,635 7,618 7,568 
Unified Women’s Healthcare, LPHealthcare Services 5.00% (L + 4.25%) 12/20/20279,975 9,900 10,008 
Waystar Technologies, Inc.Healthcare Services 4.11% (L + 4.00%) 10/22/20264,097 4,088 4,107 
Wirepath LLCDistribution & Logistics 4.20% (L + 4.00%) 8/5/202417,083 17,083 16,827 
WP CityMD Bidco LLCHealthcare Services 4.50% (L + 3.75%) 8/13/202619,818 19,658 19,817 
VT Topco, Inc.Business Services 3.61% (L + 3.50%) 8/1/20252,788 2,788 2,754 
YI, LLCHealthcare Services 5.00% (L + 4.00%) 11/7/20249,666 9,660 9,400 
Total Funded Investments$671,002 $667,892 $666,649 
Unfunded Investments - First lien
Cano Health, LLCHealthcare Services11/23/2021$2,300 $(23)$
Covenant Surgical Partners, Inc.Healthcare Services7/1/20212,000 (20)(43)
DG Investment Intermediate Holdings 2, Inc.Business Services3/31/2023799 — (3)
Higginbotham Insurance Agency, Inc.Financial Services11/25/20222,023 (15)40 
Peraton Corp.Federal Services2/1/20287,971 (40)
Total Unfunded Investments$15,093 $(98)$(1)
Total Investments$686,095 $667,794 $666,648 
(1)All interest is payable in cash unless otherwise indicated. A majority of the variable rate debt investments bear interest at a rate that may be determined by reference to the LIBOR (L), the Prime Rate (P) and the alternative base rate (Base). For each investment, the current interest rate provided reflects the rate in effect as of March 31, 2021.
(2)Represents the fair value in accordance with ASC 820. Our board of directors does not determine the fair value of the investments held by SLP III.
109

    The following table is a listing of the individual investments in SLP III's portfolio as of December 31, 2020:
Portfolio Company and Type of InvestmentIndustryInterest Rate (1)Maturity Date Principal Amount or Par Value CostFair
Value (2)
Funded Investments - First lien(in thousands)(in thousands)(in thousands)
Access CIG, LLCBusiness Services3.98% (L + 3.75%)2/27/2025$868 $868 $861 
Advisor Group Holdings, Inc.Consumer Services5.15% (L + 5.00%)7/31/20264,950 4,909 4,928 
Affordable Care Holding Corp.Healthcare Services5.75% (L + 4.75%)10/24/20225,901 5,850 5,827 
AG Parent Holdings, LLCHealthcare Services5.15% (L + 5.00%)7/31/202612,375 12,323 12,251 
Ascensus Specialties LLCSpecialty Chemicals & Materials4.90% (L + 4.75%)9/24/20269,900 9,858 9,931 
Aston FinCo S.a.r.l. / Aston US Finco, LLCSoftware4.40% (L + 4.25%)10/9/20265,955 5,904 5,900 
Astra Acquisition Corp.Software6.50% (L + 5.50%)3/1/202711,490 11,412 11,605 
BCPE Empire Holdings, Inc.Distribution & Logistics4.15% (L + 4.00%)6/11/202610,869 10,780 10,801 
Bearcat Buyer, Inc.Healthcare Services5.25% (L + 4.25%)7/9/202619,654 19,573 19,654 
Bearcat Buyer, Inc.Healthcare Services5.25% (L + 4.25%)7/9/20264,081 4,062 4,081 
Bleriot US Bidco Inc.Federal Services5.00% (L + 4.75%)10/31/20264,292 4,254 4,292 
Bleriot US Bidco Inc.Federal Services5.00% (L + 4.75%)10/31/2026671 665 671 
Bluefin Holding, LLCSoftware4.15% (L + 4.00%)9/4/20269,900 9,775 9,900 
Bracket Intermediate Holding Corp.Healthcare Services4.48% (L + 4.25%)9/5/202514,663 14,610 14,516 
Brave Parent Holdings, Inc.Software4.15% (L + 4.00%)4/18/202511,217 11,190 11,147 
Cano Health, LLCHealthcare Services5.50% (L + 4.75%)11/23/20276,308 6,244 6,244 
Cardinal Parent, Inc.Software5.25% (L + 4.50%)11/12/20277,038 6,932 6,967 
CentralSquare Technologies, LLCSoftware4.00% (L + 3.75%)8/29/202514,700 14,674 13,745 
Certara Holdco, Inc.Healthcare I.T.3.75% (L + 3.50%)8/15/20241,246 1,248 1,247 
CHA Holdings, Inc.Business Services5.50% (L + 4.50%)4/10/2025977 977 914 
CommerceHub, Inc.Software4.75% (L + 4.00%)12/29/20275,833 5,804 5,833 
Confluent Health, LLCHealthcare Services5.15% (L + 5.00%)6/24/20264,398 4,354 4,348 
Covenant Surgical Partners, Inc.Healthcare Services4.15% (L + 4.00%)7/1/20269,876 9,795 9,678 
CRCI Longhorn Holdings, Inc.Business Services3.65% (L + 3.50%)8/8/202514,663 14,611 14,498 
Dealer Tire, LLCDistribution & Logistics4.40% (L + 4.25%)12/12/20259,900 9,879 9,859 
Dentalcorp Health Services ULC (fka Dentalcorp Perfect Smile ULC)Healthcare Services4.75% (L + 3.75%)6/6/202514,636 14,611 14,421 
Drilling Info Holdings, Inc.Business Services4.40% (L + 4.25%)7/30/202518,576 18,511 18,035 
Edgewood Partners Holdings LLCBusiness Services5.25% (L + 4.25%)9/6/20247,356 7,304 7,301 
eResearchTechnology, Inc.Healthcare Services5.50% (L + 4.50%)2/4/20273,911 3,876 3,883 
EyeCare Partners, LLCHealthcare Services3.90% (L + 3.75%)2/18/202712,071 12,057 11,796 
EyeCare Partners, LLCHealthcare Services3.90% (L + 3.75%)2/18/20272,838 2,834 2,773 
Fastlane Parent Company, Inc.Distribution & Logistics4.65% (L + 4.50%)2/4/20263,439 3,386 3,419 
Frontline Technologies Intermediate Holdings, LLCSoftware6.75% (L + 5.75%)9/18/20236,513 6,513 6,513 
Greenway Health, LLCSoftware4.75% (L + 3.75%)2/16/202414,520 14,527 13,322 
Heartland Dental, LLCHealthcare Services3.65% (L + 3.50%)4/30/202518,540 18,478 18,104 
HS Purchaser, LLC / Help/Systems Holdings, Inc.Software5.75% (L + 4.75%)11/19/202618,440 18,270 18,440 
Higginbotham Insurance Agency, Inc.Financial Services6.50% (L + 5.75%)11/25/20267,187 7,134 7,331 
Idera, Inc.Software5.00% (L + 4.00%)6/28/20249,435 9,406 9,435 
Institutional Shareholder Services Inc.Business Services4.75% (L + 4.50%)3/5/2026983 975 971 
Kestra Advisor Services Holdings A, Inc.Business Services4.40% (L + 4.25%)6/3/20269,381 9,318 9,241 
LSCS Holdings, Inc.Healthcare Services4.51% (L + 4.25%)3/17/20252,627 2,612 2,575 
LSCS Holdings, Inc.Healthcare Services4.51% (L + 4.25%)3/17/2025678 674 665 
Maravai Intermediate Holdings, LLCSpecialty Chemicals & Materials5.25% (L + 4.25%)10/19/20274,125 4,085 4,148 
Market Track, LLCBusiness Services5.25% (L + 4.25%)6/5/20244,729 4,725 4,645 
Mavis Tire Express Services Corp.Retail5.00% (L + 4.00%)3/20/20254,828 4,733 4,846 
MED ParentCo, LPHealthcare Services4.40% (L + 4.25%)8/31/202610,272 10,191 10,148 
MED ParentCo, LPHealthcare Services4.40% (L + 4.25%)8/31/20262,576 2,554 2,545 
Ministry Brands, LLCSoftware5.00% (L + 4.00%)12/2/20224,502 4,492 4,480 
Ministry Brands, LLCSoftware5.00% (L + 4.00%)12/2/2022871 869 867 
National Intergovernmental Purchasing Alliance CompanyBusiness Services4.00% (L + 3.75%)5/23/20258,701 8,698 8,658 
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Portfolio Company and Type of InvestmentIndustryInterest Rate (1)Maturity Date Principal Amount or Par Value CostFair
Value (2)
National Mentor Holdings, Inc. (aka Civitas Solutions, Inc.)Healthcare Services4.43% (L + 4.25%)3/9/2026$8,887 $8,887 $8,897 
National Mentor Holdings, Inc. (aka Civitas Solutions, Inc.)Healthcare Services4.51% (L + 4.25%)3/9/2026398 398 398 
Navex Topco, Inc.Software3.40% (L + 3.25%)9/5/202518,208 18,079 17,929 
Navicure, Inc.Healthcare Services4.75% (L + 4.00%)10/22/20264,107 4,097 4,110 
Newport Group Holdings II, Inc.Business Services3.75% (L + 3.50%)9/12/20254,888 4,870 4,851 
Orion Advisor Solutions, Inc.Business Services5.00% (L + 4.00%)9/24/20275,237 5,186 5,260 
Outcomes Group Holdings, Inc.Healthcare Services3.50% (L + 3.25%)10/24/20253,400 3,394 3,349 
Pelican Products, Inc.Business Products4.50% (L + 3.50%)5/1/20254,875 4,867 4,796 
Peraton Corp. (fka MHVC Acquisition Corp.)Federal Services6.25% (L + 5.25%)4/29/202415,272 15,225 15,310 
Planview Parent, Inc.Software4.75% (L + 4.00%)12/17/20276,484 6,419 6,496 
Premise Health Holding Corp.Healthcare Services3.75% (L + 3.50%)7/10/202513,583 13,538 13,279 
Project Accelerate Parent, LLCBusiness Services5.25% (L + 4.25%)1/2/20259,822 9,786 8,939 
Project Boost Purchaser, LLCBusiness Services5.00% (L + 4.25%)6/1/20261,995 1,975 2,002 
Quest Software US Holdings Inc.Software4.46% (L + 4.25%)5/16/202514,700 14,650 14,480 
Ryan Specialty Group, LLCBusiness Services4.00% (L + 3.25%)9/1/20273,491 3,441 3,491 
Sierra Enterprises, LLCFood & Beverage5.00% (L + 4.00%)11/11/20242,431 2,429 2,393 
Sovos Brands Intermediate, Inc.Food & Beverage4.96% (L + 4.75%)11/20/20253,591 3,582 3,609 
Spring Education Group, Inc. (fka SSH Group Holdings, Inc.)Education4.50% (L + 4.25%)7/30/202512,183 12,161 11,665 
Symplr Software, Inc.(fka Caliper Software, Inc.)Healthcare I.T.5.25% (L + 4.50%)12/22/202710,000 9,850 9,913 
Syndigo LLCSoftware5.25% (L + 4.50%)12/15/202715,000 14,888 14,888 
TIBCO Software Inc.Software3.90% (L + 3.75%)6/30/20267,654 7,637 7,572 
Unified Women’s Healthcare, LPHealthcare Services5.00% (L + 4.25%)12/20/202710,000 9,923 9,975 
Wirepath LLCDistribution & Logistics4.25% (L + 4.00%)8/5/202417,127 17,127 16,527 
WP CityMD Bidco LLCHealthcare Services5.50% (L + 4.50%)8/13/202619,868 19,701 19,914 
VT Topco, Inc.Business Services3.65% (L + 3.50%)8/1/20252,795 2,795 2,763 
YI, LLCHealthcare Services5.00% (L + 4.00%)11/7/20249,691 9,685 8,915 
Total Funded Investments$619,147 $615,974 $609,981 
Unfunded Investments - First lien
Cano Health, LLCHealthcare Services11/23/2021$2,300 $(23)$(23)
Covenant Surgical Partners, Inc.Healthcare Services7/1/20212,000 (20)(40)
Higginbotham Insurance Agency, Inc.Financial Services11/25/20222,023 (15)40 
Planview Parent, Inc.Software3/31/20211,515 — 
Total Unfunded Investments$7,838 $(58)$(20)
Total Investments$626,985 $615,916 $609,961 
(1)All interest is payable in cash unless otherwise indicated. A majority of the variable rate debt investments bear interest at a rate that may be determined by reference to the LIBOR (L), the Prime Rate (P) and the alternative base rate (Base). For each investment, the current interest rate provided reflects the rate in effect as of December 31, 2020.
(2)Represents the fair value in accordance with ASC 820. Our board of directors does not determine the fair value of the investments held by SLP III.


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    Below is certain summarized financial information for SLP III as of March 31, 2021 and December 31, 2020 and for the three months ended March 31, 2021 and March 31, 2020:
Selected Balance Sheet Information:March 31, 2021December 31, 2020
(in thousands)(in thousands)
Investments at fair value (cost of $667,794 and $615,916)$666,648 $609,961 
Cash and other assets20,507 10,176 
Receivable from unsettled securities sold4,828 — 
Total assets$691,983 $620,137 
Credit facility$474,200 $424,200 
Deferred financing costs(2,210)(2,471)
Payable for unsettled securities purchased50,333 47,192 
Distribution payable5,658 3,800 
Other liabilities2,505 2,501 
Total liabilities530,486 475,222 
Members' capital$161,497 $144,915 
Total liabilities and members' capital$691,983 $620,137 
Three Months Ended
Selected Statement of Operations Information:March 31, 2021March 31, 2020
(in thousands)(in thousands)
Interest income$7,371 $7,407 
Other income103 181 
Total investment income7,474 7,588 
Interest and other financing expenses2,584 3,696 
Other expenses171 157 
Total expenses2,755 3,853 
Net investment income4,719 3,735 
Net realized gains (losses) on investments212 (2)
Net change in unrealized appreciation (depreciation) of investments4,809 (63,348)
Net increase (decrease) in members' capital$9,740 $(59,615)

    For the three months ended March 31, 2021 and March 31, 2020, we earned approximately $4.5 million and $2.9 million of dividend income related to SLP III, which is included in dividend income. As of March 31, 2021 and December 31, 2020, approximately $4.5 million and $3.0 million, respectively, of dividend income related to SLP III was included in interest and dividend receivable.
    We have determined that SLP III is an investment company under ASC 946; however, in accordance with such guidance we will generally not consolidate our investment in a company other than a wholly-owned investment company subsidiary. Furthermore, ASC 810 concludes that in a joint venture where both members have equal decision making authority, it is not appropriate for one member to consolidate the joint venture since neither has control. Accordingly, we do not consolidate SLP III.
New Mountain Net Lease Corporation
     NMNLC was formed to acquire commercial real estate properties that are subject to "triple net" leases. NMNLC's investments are disclosed on our Consolidated Schedule of Investments as of March 31, 2021.
    On March 30, 2020, an affiliate of the Investment Adviser purchased directly from NMNLC 105,030 shares of NMNLC’s common stock at a price of $107.73 per share, which represented the net asset value per share of NMNLC at the
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date of purchase, for an aggregate purchase price of approximately $11.3 million. Immediately thereafter, NMNLC redeemed 105,030 shares of its common stock held by NMFC in exchange for a promissory note with a principal amount of $11.3 million and a 7.0% interest rate, which was repaid by NMNLC to NMFC on March 31, 2020.
    
Below is certain summarized property information for NMNLC as of March 31, 2021:
Lease Total Fair Value as of
Portfolio CompanyTenantExpiration DateLocationSquare FeetMarch 31, 2021
(in thousands)(in thousands)
NM NL Holdings LP / NM GP Holdco LLCVariousVariousVariousVarious$102,635 
NM GLCR LPArctic Glacier U.S.A.2/28/2038CA21429,463 
NM CLFX LPVictor Equipment Company8/31/2033TX42314,896 
NM APP Canada, Corp.A.P. Plasman, Inc.9/30/2031Canada43612,488 
NM APP US LLCPlasman Corp, LLC / A-Brite LP9/30/2033AL / OH2617,525 
NM DRVT LLCFMH Conveyors, LLC10/31/2031AR1957,194 
NM YI, LLCYoung Innovations, Inc.10/31/2039IL / MO2126,866 
NM JRA LLCJ.R. Automation Technologies, LLC1/31/2031MI883,861 
NM KRLN LLCNoneN/AMD95717 
$185,645 
Collateralized agreements or repurchase financings
    We follow the guidance in Accounting Standards Codification Topic 860, Transfers and Servicing—Secured Borrowing and Collateral, (“ASC 860”) when accounting for transactions involving the purchases of securities under collateralized agreements to resell (resale agreements). These transactions are treated as collateralized financing transactions and are recorded at their contracted resale or repurchase amounts, as specified in the respective agreements. Interest on collateralized agreements is accrued and recognized over the life of the transaction and included in interest income. As of March 31, 2021 and December 31, 2020, we held one collateralized agreement to resell with a cost basis of $30.0 million and $30.0 million, respectively, and a fair value of $21.4 million and $21.4 million, respectively. The collateralized agreement to resell is on non-accrual. The collateralized agreement to resell is guaranteed by a private hedge fund, PPVA Fund, L.P. The private hedge fund is currently in liquidation under the laws of the Cayman Islands. Pursuant to the terms of the collateralized agreement, the private hedge fund was obligated to repurchase the collateral from us at the par value of the collateralized agreement. The private hedge fund has breached its agreement to repurchase the collateral under the collateralized agreement. The default by the private hedge fund did not release the collateral to us, therefore, we do not have full rights and title to the collateral. A claim has been filed with the Cayman Islands joint official liquidators to resolve this matter. The joint official liquidators have recognized our contractual rights under the collateralized agreement. We continue to exercise our rights under the collateralized agreement and continue to monitor the liquidation process of the private hedge fund. The fair value of the collateralized agreement to resell is reflective of the increased risk of the position.
PPVA Black Elk (Equity) LLC
    On May 3, 2013, we entered into a collateralized securities purchase and put agreement (the “SPP Agreement”) with a private hedge fund. Under the SPP Agreement, we purchased twenty million Class E Preferred Units of Black Elk Energy Offshore Operations, LLC (“Black Elk”) for $20.0 million with a corresponding obligation of the private hedge fund, PPVA Black Elk (Equity) LLC, to repurchase the preferred units for $20.0 million plus other amounts due under the SPP Agreement. The majority owner of Black Elk was the private hedge fund. In August 2014, we received a payment of $20.5 million, the full amount due under the SPP Agreement.
    In August 2017, a trustee (the “Trustee”) for Black Elk informed us that the Trustee intended to assert a fraudulent conveyance claim (the “Claim”) against us and one of its affiliates seeking the return of the $20.5 million repayment. Black Elk filed a Chapter 11 bankruptcy petition pursuant to the United States Bankruptcy Code in August 2015. The Trustee alleged that individuals affiliated with the private hedge fund conspired with Black Elk and others to improperly use proceeds from the sale of certain Black Elk assets to repay, in August 2014, the private hedge fund’s obligation to us under the SPP Agreement. We were unaware of these claims at the time the repayment was received. The private hedge fund is currently in liquidation under the laws of the Cayman Islands.
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    On December 22, 2017, we settled the Trustee’s $20.5 million Claim for $16.0 million and filed a claim with the Cayman Islands joint official liquidators of the private hedge fund for $16.0 million that is owed to us under the SPP Agreement. The SPP Agreement was restored and is in effect since repayment has not been made. We continue to exercise our rights under the SPP Agreement and continue to monitor the liquidation process of the private hedge fund. During the year ended December 31, 2018, we received a $1.5 million payment from our insurance carrier in respect to the settlement. As of March 31, 2021 and December 31, 2020, the SPP Agreement has a cost basis of $14.5 million and $14.5 million, respectively, and a fair value of $10.4 million and $10.4 million, respectively, which is reflective of the higher inherent risk in this transaction.
Revenue Recognition
    Sales and paydowns of investments:  Realized gains and losses on investments are determined on the specific identification method.
    Interest and dividend income:  Interest income, including amortization of premium and discount using the effective interest method, is recorded on the accrual basis and periodically assessed for collectability. Interest income also includes interest earned from cash on hand. Upon the prepayment of a loan or debt security, any prepayment penalties are recorded as part of interest income. We have loans and certain preferred equity investments in the portfolio that contain a payment-in-kind (“PIK”) interest or dividend provision. PIK interest and dividends are accrued and recorded as income at the contractual rates, if deemed collectible. The PIK interest and dividends are added to the principal or share balances on the capitalization dates and are generally due at maturity or when redeemed by the issuer. For the three months ended March 31, 2021 and March 31, 2020, we recognized PIK and non-cash interest from investments of approximately $5.8 million and $3.5 million, respectively, and PIK and non-cash dividends from investments of approximately $5.2 million and $1.6 million, respectively.
    Dividend income on common equity is recorded on the record date for private portfolio companies or on the ex-dividend date for publicly traded portfolio companies. Dividend income on preferred securities is recorded as dividend income on an accrual basis to the extent that such amounts are deemed collectible.
    Non-accrual income:  Investments are placed on non-accrual status when principal or interest payments are past due for 30 days or more and when there is reasonable doubt that principal or interest will be collected. Accrued cash and un-capitalized PIK interest or dividends are reversed when an investment is placed on non-accrual status. Previously capitalized PIK interest or dividends are not reversed when an investment is placed on non-accrual status. Interest or dividend payments received on non-accrual investments may be recognized as income or applied to principal depending upon management’s judgment of the ultimate collectibility. Non-accrual investments are restored to accrual status when past due principal and interest is paid and, in management’s judgment, are likely to remain current.
    Other income:  Other income represents delayed compensation, consent or amendment fees, revolver fees, structuring fees, upfront fees, management fees from a non-controlled/affiliated investment and other miscellaneous fees received and are typically non-recurring in nature. Delayed compensation is income earned from counterparties on trades that do not settle within a set number of business days after trade date. Other income may also include fees from bridge loans. We may from time to time enter into bridge financing commitments, an obligation to provide interim financing to a counterparty until permanent credit can be obtained. These commitments are short-term in nature and may expire unfunded. A fee is received for providing such commitments. Structuring fees and upfront fees are recognized as income when earned, usually when paid at the closing of the investment, and are non-refundable.
Monitoring of Portfolio Investments
    We monitor the performance and financial trends of our portfolio companies on at least a quarterly basis. We attempt to identify any developments within the portfolio company, the industry or the macroeconomic environment that may alter any material element of our original investment strategy.
    We use an investment rating system to characterize and monitor the credit profile and expected level of returns on each investment in the portfolio. We use a four-level numeric rating scale as follows:
Investment Rating 1—Investment is performing materially above expectations;
Investment Rating 2—Investment is performing materially in-line with expectations. All new loans are rated 2 at initial purchase;
Investment Rating 3—Investment is performing materially below expectations, where the risk of loss has materially increased since the original investment; and
Investment Rating 4—Investment is performing substantially below expectations and risks have increased substantially since the original investment. Payments may be delinquent. There is meaningful possibility that we will not recoup our original cost basis in the investment and may realize a substantial loss upon exit.
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    The following table shows the distribution of our investments and securities purchased under collateralized agreements to resell on the 1 to 4 investment rating scale at fair value as of March 31, 2021:
(in millions)As of March 31, 2021
Investment RatingCostPercentFair ValuePercent
Investment Rating 1$466.1 15.2 %$494.4 16.3 %
Investment Rating 22,342.9 76.6 %2,397.1 78.8 %
Investment Rating 3151.45.0 %112.0 3.7 %
Investment Rating 498.9 3.2 %36.5 1.2 %
 $3,059.3 100.0 %$3,040.0 100.0 %
    As of March 31, 2021, all investments in our portfolio had an Investment Rating of 1 or 2 with the exception of six portfolio companies that had an Investment Rating of 3 and four portfolio companies that had an Investment Rating of 4.
    During the first quarter of 2020, we placed our investment in our junior preferred shares of UniTek Global Services, Inc. ("UniTek") on non-accrual status and the investment had a rating of 4. As of March 31, 2021, our junior preferred shares of UniTek had an aggregate cost basis of $34.4 million, an aggregate fair value of $0.0 million and total unearned dividend income of $1.4 million for the three months then ended. During the fourth quarter of 2020, we placed an aggregate principal amount of $9.7 million of our investment in our senior preferred shares of UniTek on non-accrual status and the investment had a rating of 4. As of March 31, 2021, our senior preferred shares of UniTek on non-accrual had an aggregate cost basis of $9.7 million, an aggregate fair value of approximately $4.0 million and total unearned dividend income of approximately $0.5 million for the three months then ended.
    During the first quarter of 2018, we placed our first lien positions in Education Management II LLC on non-accrual status as the portfolio company announced its intention to wind down and liquidate the business. Our first lien positions and our preferred and common shares in Education Management Corporation ("EDMC") have an investment rating of 4. As of March 31, 2021, our investment in EDMC, with an Investment Rating of 4 had an aggregate cost basis of $1.4 million, an aggregate fair value of $0.0 million and total unearned interest income of $0.0 million for the three months then ended.
    Since March 31, 2020, our investment in NM KRLN LLC had an investment rating of 4 and had an aggregate cost basis of $8.9 million and an aggregate fair value of $0.7 million.
    Since December 31, 2019, our subordinated position in PPVA Black Elk (Equity) LLC had an investment rating of 4. As of March 31, 2021, our investment in this security had an aggregate cost basis of $14.5 million and an aggregate fair value of approximately $10.4 million.
    During the year ended December 31, 2019, our security purchased under collateralized agreements to resell was placed on non-accrual and the investment had an Investment Rating of 4. As of March 31, 2021, our investment in this security had an aggregate cost basis of $30.0 million and an aggregate fair value of approximately $21.4 million.
    In response to the continuing impact of the outbreak of the COVID-19 pandemic and its impact on the overall market environment and the health of our portfolio companies, we performed a company-by-company evaluation of the anticipated impact of the COVID-19 pandemic. The evaluation process consisted of dialogue with sponsors and portfolio companies to understand the COVID-19 pandemic's impact on each portfolio company, the portfolio company’s response to any disruption, the level of sponsor support, and the current and projected financial and liquidity position of the portfolio company. Based on this evaluation, we assigned each portfolio company a “Risk Rating” of red, orange, yellow and green, with red reflecting a portfolio company with the potential for the most severe impact, due to the COVID-19 pandemic, and green reflecting the least. We will continue to monitor our portfolio companies and provide support to their management teams where possible.
The following table shows the Risk Rating of our portfolio companies as of March 31, 2021:
(in millions)
As of March 31, 2021
Risk RatingCostPercentFair ValuePercent
Red$87.1 2.8 %$67.2 2.2 %
Orange163.0 5.3 %154.1 5.1 %
Yellow249.9 8.2 %190.9 6.3 %
Green2,559.3 83.7 %2,627.8 86.4 %
 $3,059.3 100.0 %$3,040.0 100.0 %

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Portfolio and Investment Activity
    The fair value of our investments was approximately $3,018.6 million in 102 portfolio companies at March 31, 2021 and approximately $2,953.5 million in 104 portfolio companies at December 31, 2020.
    The following table shows our portfolio and investment activity for the three months ended March 31, 2021 and March 31, 2020:
 Three Months Ended
(in millions)March 31, 2021March 31, 2020
New investments in 13 and 17 portfolio companies, respectively$223.4 $181.7 
Debt repayments in existing portfolio companies190.7 151.5 
Sales of securities in 2 and 3 portfolio companies, respectively7.0 38.6 
Change in unrealized appreciation on 47 and 6 portfolio companies, respectively45.6 1.0 
Change in unrealized depreciation on 55 and 112 portfolio companies, respectively(12.1)(205.7)
Recent Accounting Standards Updates
    See Item 1.—Financial Statements—Note 13. Recent Accounting Standards for details on recent accounting standards updates.
Results of Operations for the Three Months Ended March 31, 2021 and March 31, 2020
Revenue
 Three Months Ended
(in thousands)March 31, 2021March 31, 2020
Total interest income$47,009 $61,636 
Total dividend income15,662 10,493 
Other income5,037 1,955 
Total investment income$67,708 $74,084 
    Our total investment income decreased by approximately $6.4 million, or (9)%, for the three months ended March 31, 2021 as compared to the three months ended March 31, 2020. For the three months ended March 31, 2021, total investment income of approximately $67.7 million consisted of approximately $38.8 million in cash interest from investments, approximately $5.8 million in PIK and non-cash interest from investments, approximately $0.4 million in prepayment fees, net amortization of purchase premiums and discounts of approximately $2.0 million, approximately $10.5 million in cash dividends from investments, approximately $5.2 million in PIK and non-cash dividends from investments and approximately $5.0 million in other income. The decrease in interest income of approximately $14.6 million during the three months ended March 31, 2021 as compared to the three months ended March 31, 2020 was primarily due to lower LIBOR rates on smaller invested balances. Our smaller invested balances were driven by the repayments of our revolving credit facilities due to asset sales and repayments greater than asset originations during 2020. The increase in dividend income for the three months ended March 31, 2021 as compared to the three months ended March 31, 2020 was primarily due to the reversal of approximately $3.4 million of previously recorded PIK dividends related to our preferred shares in Permian Holdco 1, Inc., which was deemed to no longer be collectible for the three months ended March 31, 2020. Other income during the three months ended March 31, 2021, which represents fees that are generally non-recurring in nature, was primarily attributable to upfront, consent and amendment fees received from 19 different portfolio companies.

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Operating Expenses
 Three Months Ended
(in thousands)March 31, 2021March 31, 2020
Management fee$13,420 $13,858 
Less: management fee waiver(3,637)(3,543)
Total management fee9,783 10,315 
Incentive fee7,248 7,826 
Interest and other financing expenses19,385 22,194 
Administrative expenses1,129 1,040 
Professional fees726 905 
Other general and administrative expenses442 499 
Total expenses38,713 42,779 
Income tax expense— 
Net expenses after income taxes$38,714 $42,779 
    Our total net operating expenses decreased by approximately $4.1 million for the three months ended March 31, 2021 as compared to the three months ended March 31, 2020. Our management fee decreased by approximately $0.5 million, net of a management fee waiver, and our incentive fee decreased by approximately $0.6 million for the three months ended March 31, 2021 as compared to the three months ended March 31, 2020. The decrease in management and incentive fees was attributable to smaller invested balances, driven by the repayments of our revolving credit facilities due to asset sales and repayments greater than asset originations during 2020.
    Interest and other financing expenses decreased by approximately $2.8 million during the three months ended March 31, 2021 as compared to the three months ended March 31, 2020, primarily due to lower LIBOR rates on our floating rate borrowings and lower drawn balances on our revolving credit facilities. Our total professional fees, administrative expenses and total other general and administrative expenses for the three months ended March 31, 2021 as compared to the three months ended March 31, 2020 remained relatively flat.
Net Realized Gains (Losses) and Net Change in Unrealized Appreciation (Depreciation)
 Three Months Ended
(in thousands)March 31, 2021March 31, 2020
Net realized (losses) gains on investments$(10,496)$114 
Net change in unrealized appreciation (depreciation) of investments33,472 (204,739)
(Provision) benefit for taxes(115)898 
Net realized and unrealized gains (losses) $22,861 $(203,727)
    Our net realized losses and unrealized gains resulted in a net gain of approximately $22.9 million for the three months ended March 31, 2021 compared to net realized gains and unrealized losses resulting in a net loss of approximately $203.7 million for the same period in 2020. As movement in unrealized appreciation or depreciation can be the result of realizations, we look at net realized and unrealized gains or losses together. The net gain for the three months ended March 31, 2021 was primarily driven by the overall increase in market prices of our investments during the period. The provision for income taxes was attributable to equity investments that are held as of March 31, 2021 in four of our corporate subsidiaries. The net loss for the three months ended March 31, 2020 was primarily driven by the overall decrease in market prices of our investments during the period due to the impact of the COVID-19 pandemic. See Monitoring of Portfolio Investments above for more details regarding the continuing impact of the COVID-19 pandemic on the health of our portfolio companies.
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Liquidity and Capital Resources
    The primary use of existing funds and any funds raised in the future is expected to be for repayment of indebtedness, investments in portfolio companies, cash distributions to our stockholders or for other general corporate purposes.
    Since our IPO, and through March 31, 2021, we raised approximately $893.2 million in net proceeds from additional offerings of common stock.
    Our liquidity is generated and generally available through advances from the revolving credit facilities, from cash flows from operations, and, we expect, through periodic follow-on equity offerings. In addition, we may from time to time enter into additional debt facilities, increase the size of existing facilities or issue additional debt securities, including unsecured debt and/or debt securities convertible into common stock. Any such incurrence or issuance would be subject to prevailing market conditions, our liquidity requirements, contractual and regulatory restrictions and other factors. On June 8, 2018 our shareholders approved the application of the modified asset coverage requirements set forth in Section 61(a) of the 1940 Act, which resulted in the reduction from 200.0% to 150.0% of the minimum asset coverage ratio applicable to us as of June 9, 2018. In accordance with the 1940 Act, with certain limited exceptions, we are only allowed to borrow amounts such that our asset coverage, calculated pursuant to the 1940 Act, is at least 150.0% after such borrowing (which means we can borrow $2 for every $1 of our equity). As a result of our exemptive relief received on November 5, 2014, we are permitted to exclude our SBA-guaranteed debentures from the 150.0% asset coverage ratio that the we are required to maintain under the 1940 Act. The agreements governing the NMFC Credit Facility, the 2018 Convertible Notes and the Unsecured Notes (as defined below) contain certain covenants and terms, including a requirement that we not exceed a debt-to-equity ratio of 1.65 to 1.00 at the time of incurring additional indebtedness and a requirement that we not exceed a secured debt ratio of 0.70 to 1.00 at any time. As of March 31, 2021, our asset coverage ratio was 184.6%.
    At March 31, 2021 and December 31, 2020, we had cash and cash equivalents of approximately $47.3 million and $79.0 million, respectively. Our cash provided by (used in) operating activities during the three months ended March 31, 2021 and March 31, 2020 was approximately $44.3 million and $(13.5) million, respectively. We expect that all current liquidity needs will be met with cash flows from operations and other activities.
Borrowings
    Holdings Credit Facility—On October 24, 2017, we entered into the Third Amended and Restated Loan and Security Agreement among us, as the Collateral Manager, NMF Holdings, as the Borrower, Wells Fargo Securities, LLC, as the Administrative Agent and Wells Fargo Bank, National Association, as the Lender and Collateral Custodian (as amended from time to time, the "Holdings Credit Facility"). As of the most recent amendment on September 30, 2020, the maturity date of the Holdings Credit Facility is September 30, 2023, and the maximum facility amount is the lesser of $800.0 million and the actual commitments of the lenders to make advances as of such date.
    As of March 31, 2021, the maximum amount of revolving borrowings available under the Holdings Credit Facility is $745.0 million. Under the Holdings Credit Facility, NMF Holdings is permitted to borrow up to 25.0%, 45.0%, 67.5% or 70.0% of the purchase price of pledged assets, subject to approval by Wells Fargo Bank, National Association. The Holdings Credit Facility is non-recourse to us and is collateralized by all of the investments of NMF Holdings on an investment by investment basis. All fees associated with the origination or upsizing of the Holdings Credit Facility are capitalized on our Consolidated Statement of Assets and Liabilities and charged against income as other financing expenses over the life of the Holdings Credit Facility. The Holdings Credit Facility contains certain customary affirmative and negative covenants and events of default. In addition, the Holdings Credit Facility requires us to maintain a minimum asset coverage ratio of 150.0%. The covenants are generally not tied to mark to market fluctuations in the prices of NMF Holdings investments, but rather to the performance of the underlying portfolio companies.
    As of the most recent amendment on September 30, 2020, the Holdings Credit Facility bears interest at a rate of LIBOR plus 2.00% per annum for Broadly Syndicated Loans (as defined in the Third Amended and Restated Loan and Security Agreement) and LIBOR plus 2.50% per annum for all other investments. Previously the Holdings Credit Facility bore interest at a rate of LIBOR plus 1.75% per annum for Broadly Syndicated Loans (as defined in the Second Amended and Restated Loan and Security Agreement) and LIBOR plus 2.25% per annum for all other investments. The Holdings Credit Facility also charges a non-usage fee, based on the unused facility amount multiplied by the Non-Usage Fee Rate (as defined in the Third Amended and Restated Loan and Security Agreement).
    
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    The following table summarizes the interest expense, non-usage fees and amortization of financing costs incurred on the Holdings Credit Facility for the three months ended March 31, 2021 and March 31, 2020:
 Three Months Ended
(in millions)March 31, 2021March 31, 2020
Interest expense$2.7 $5.4 
Non-usage fee$0.4 $0.2 
Amortization of financing costs$0.5 $0.3 
Weighted average interest rate2.4 %3.5 %
Effective interest rate3.2 %3.8 %
Average debt outstanding$450.2 $629.5 
As of March 31, 2021 and December 31, 2020, the outstanding balance on the Holdings Credit Facility was $450.2 million and $450.2 million, respectively, and NMF Holdings was in compliance with the applicable covenants in the Holdings Credit Facility on such dates.
    NMFC Credit Facility—The Senior Secured Revolving Credit Agreement, (as amended from time to time, and together with the related guarantee and security agreement, the "NMFC Credit Facility"), dated June 4, 2014, among us, as the Borrower, Goldman Sachs Bank USA, as the Administrative Agent and Collateral Agent, and Goldman Sachs Bank USA, Morgan Stanley Bank, N.A., Stifel Bank & Trust and MUFG Union Bank, N.A., as Lenders, is structured as a senior secured revolving credit facility. The NMFC Credit Facility is guaranteed by certain of our domestic subsidiaries and proceeds from the NMFC Credit Facility may be used for general corporate purposes, including the funding of portfolio investments. The maturity date of the NMFC Credit Facility is June 4, 2022.
    As of March 31, 2021, the maximum amount of revolving borrowings available under the NMFC Credit Facility was $188.5 million. We are permitted to borrow at various advance rates depending on the type of portfolio investment as outlined in the related Senior Secured Revolving Credit Agreement. All fees associated with the origination of the NMFC Credit Facility are capitalized on our Consolidated Statement of Assets and Liabilities and charged against income as other financing expenses over the life of the NMFC Credit Facility. The NMFC Credit Facility contains certain customary affirmative and negative covenants and events of default, including certain financial covenants related to the asset coverage and liquidity and other maintenance covenants.
    The NMFC Credit Facility generally bears interest at a rate of LIBOR plus 2.50% per annum or the prime rate plus 1.50% per annum, and charges a commitment fee, based on the unused facility amount multiplied by 0.375% per annum (as defined in the Senior Secured Revolving Credit Agreement).
    The following table summarizes the interest expense, non-usage fees and amortization of financing costs incurred on the NMFC Credit Facility for the three months ended March 31, 2021 and March 31, 2020:
 Three Months Ended
(in millions)March 31, 2021March 31, 2020
Interest expense$0.7 $1.9 
Non-usage fee$0.1 $— 
Amortization of financing costs$— (1)$— (1)
Weighted average interest rate2.7 %4.1 %
Effective interest rate3.1 %4.2 %
Average debt outstanding$104.5 $188.5 
(1)For the three months ended March 31, 2021 and March 31, 2020, the total amortization of financing costs were less than $50.0 thousand.
    As of March 31, 2021 and December 31, 2020, the outstanding balance on the NMFC Credit Facility was $107.0 million and $165.5 million, respectively, and NMFC was in compliance with the applicable covenants in the NMFC Credit Facility on such dates.
    DB Credit Facility—The Loan Financing and Servicing Agreement (the "DB Credit Facility") dated December 14, 2018 and as amended from time to time, among NMFDB as the borrower, Deutsche Bank AG, New York Branch ("Deutsche Bank") as the facility agent, Lender and other agent from time to time party thereto and U.S. Bank National Association, as collateral agent and collateral custodian, is structured as a secured revolving credit facility and matures on March 25, 2026.
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    As of March 31, 2021, the maximum amount of revolving borrowings available under the DB Credit Facility was $280.0 million. We are permitted to borrow at various advance rates depending on the type of portfolio investment, as outlined in the Loan Financing and Servicing Agreement. The DB Credit Facility is non-recourse to us and is collateralized by all of the investments of NMFDB on an investment by investment basis. All fees associated with the origination of the DB Credit Facility are capitalized on our Consolidated Statement of Assets and Liabilities and charged against income as other financing expenses over the life of the DB Credit Facility. The DB Credit Facility contains certain customary affirmative and negative covenants and events of default. The covenants are generally not tied to mark to market fluctuations in the prices of NMFDB investments, but rather to the performance of the underlying portfolio companies.
    The advances under the DB Credit Facility accrue interest at a per annum rate equal to the Applicable Margin plus the lender's Cost of Funds Rate. Prior to March 25, 2021, the Applicable Margin was equal to 2.60% during the Revolving Period and then increases by 0.02% during an Event of Default. Effective March 25, 2021, the Applicable Margin is equal to 2.35% during the Revolving Period and then increases by 0.20% during an Event of Default. The "Cost of Funds Rate" for a conduit lender is the lower of its commercial paper rate and the Base Rate plus 0.50%, and for any other lender is the Base Rate. The "Base Rate" is the three-months LIBOR Rate but may become an alternative base rate based on Deutsche Bank's base lending rate if certain LIBOR disruption events occur. We are also charged a non-usage fee, based on the unused facility amount multiplied by the Undrawn Fee Rate (as defined in the Loan Financing and Servicing Agreement) and a facility agent fee of 0.25% per annum on the total facility amount.
    The following table summarizes the interest expense, non-usage fees and amortization of financing costs incurred on the DB Credit Facility for the three months ended March 31, 2021 and March 31, 2020:
 Three Months Ended
(in millions)March 31, 2021March 31, 2020
Interest expense(1)$1.7 $2.6 
Non-usage fee(1)$0.1 $0.1 
Amortization of financing costs$0.2 $0.2 
Weighted average interest rate3.1 %4.5 %
Effective interest rate3.5 %4.9 %
Average debt outstanding$218.6 $235.1 
(1)Interest expense includes the portion of the facility agent fee applicable to the drawn portion of the DB Credit Facility and non-usage fee includes the portion of the facility agent fee applicable to the undrawn portion of the DB Credit Facility.
    As of March 31, 2021 and December 31, 2020, the outstanding balance on the DB Credit Facility was $201.0 million and $244.0 million, respectively, and NMFDB was in compliance with the applicable covenants in the DB Credit Facility on such date.
    Unsecured Management Company Revolver—The Uncommitted Revolving Loan Agreement, (the "Unsecured Management Company Revolver"), dated March 30, 2020, by and between us, as the Borrower, and NMF Investments III, L.L.C., as Lender, an affiliate of the Investment Adviser, is structured as a discretionary unsecured revolving credit facility. The proceeds from the Unsecured Management Company Revolver may be used for general corporate purposes, including the funding of portfolio investments. The maturity date of the Unsecured Management Company Revolver is December 31, 2022. The Unsecured Management Company Revolver generally bears interest at a rate of 7.00% per annum (as defined in the Uncommitted Revolving Loan Agreement). On May 4, 2020, we entered into an Amended and Restated Uncommitted Revolving Loan Agreement with NMF Investments III, L.L.C., which increased the maximum amounts of revolving borrowings available thereunder from $30.0 million to $50.0 million. As of March 31, 2021, the maximum amount of revolving borrowings available under the Unsecured Management Company Revolver was $50.0 million and no borrowings were outstanding. For the three months ended March 31, 2021 and March 31, 2020, amortization of financing costs were each less than $50.0 thousand, respectively.
    NMNLC Credit Facilities—The Revolving Credit Agreement (together with the related guarantee and security agreement, the “NMNLC Credit Facility”), dated September 21, 2018, by and between NMNLC, as the Borrower, and KeyBank National Association, as the Administrative Agent and Lender, was structured as a senior secured revolving credit facility and matured on September 23, 2020. The NMNLC Credit Facility was guaranteed by us and proceeds from the NMNLC Credit Facility were able to be used for funding of additional acquisition properties.
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The NMNLC Credit Facility bore interest at a rate of LIBOR plus 2.50% per annum or the prime rate plus 1.50% per annum, and charged a commitment fee, based on the unused facility amount multiplied by 0.15% per annum (as defined in the Revolving Credit Agreement). For the three months ended March 31, 2020, interest expense, non-usage fees and amortization of financing costs were each less than $50.0 thousand.
The Credit Agreement (together with the related guarantee and security agreement, "the NMNLC Credit Facility II"), dated February 26, 2021, by and between NMNLC, as the Borrower, and City National Bank, as the Lender, is structured as a senior secured revolving credit facility and matures on February 25, 2022. The NMNLC Credit Facility II is guaranteed by us and proceeds from the NMNLC Credit Facility II are able to be used for funding of additional acquisition properties. As of March 31, 2021, the maximum amount of revolving borrowings available under the NMNLC Credit Facility II is $10.0 million.
    The NMNLC Credit Facility II bears interest at a rate of LIBOR plus 2.75% per annum, and charges a commitment fee, based on the unused facility amount multiplied by 0.05% per annum (as defined in the Credit Agreement). For the three months ended March 31, 2021, interest expense, non-usage fees and amortization of financing costs were each less than $50.0 thousand. As of March 31, 2021, the outstanding balance on the NMNLC Credit Facility II was $0 million and NMNLC was in compliance with the applicable covenants in the NMNLC Credit Facility II on such date.
    Convertible Notes—On August 20, 2018, we closed a registered public offering of $100.0 million aggregate principal amount of unsecured convertible notes (the “2018 Convertible Notes” and together with the 2014 Convertible Notes, the "Convertible Notes"), pursuant to an indenture, dated August 20, 2018, as supplemented by a first supplemental indenture thereto, dated August 20, 2018 (together the “2018A Indenture”). On August 30, 2018, in connection with the registered public offering, we issued an additional $15.0 million aggregate principal amount of the 2018 Convertible Notes pursuant to the exercise of an overallotment option by the underwriter of the 2018 Convertible Notes. On June 7, 2019, we closed a registered public offering of an additional $86.3 million aggregate principal amount of the 2018 Convertible Notes. These additional 2018 Convertible Notes constitute a further issuance of, rank equally in right of payment with, and form a single series with the $115.0 million aggregate principal amount of 2018 Convertible Notes that we issued in August 2018.
    The 2018 Convertible Notes bear interest at an annual rate of 5.75%, payable semi-annually in arrears on February 15 and August 15 of each year. The 2018 Convertible Notes will mature on August 15, 2023 unless earlier converted, repurchased or redeemed pursuant to the terms of the 2018A Indenture. We may not redeem the 2018 Convertible Notes prior to May 15, 2023. On or after May 15, 2023, we may redeem the 2018 Convertible Notes for cash, in whole or from time to time in part, at our option at a redemption price, subject to an exception for redemption dates occurring after a record date but on or prior to the interest payment date, equal to the sum of (i) 100% of the principal amount of the 2018 Convertible Notes to be redeemed, (ii) accrued and unpaid interest thereon to, but excluding, the redemption date and (iii) a make-whole premium.
    No sinking fund is provided for the 2018 Convertible Notes. Holders of 2018 Convertible Notes may, at their option, convert their 2018 Convertible Notes into shares of our common stock at any time on or prior to the close of business on the business day immediately preceding the maturity date of the 2018 Convertible Notes. In addition, if certain corporate events occur, holders of the 2018 Convertible Notes may require us to repurchase for cash all or part of their 2018 Convertible Notes at a repurchase price equal to 100.0% of the principal amount of the 2018 Convertible Notes to be repurchased, plus accrued and unpaid interest through, but excluding, the repurchase date.
    The 2018A Indenture contains certain covenants, including covenants requiring us to provide certain financial information to the holders of the 2018 Convertible Notes and the trustee if we cease to be subject to the reporting requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). The 2018A Indenture also includes additional financial covenants related to our asset coverage ratio. These covenants are subject to limitations and exceptions that are described in the 2018A Indenture.

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    The following table summarizes certain key terms related to the convertible features of our 2018 Convertible Notes as of March 31, 2021:
2018 Convertible Notes
Initial conversion premium10.0 %
Initial conversion rate(1)65.8762 
Initial conversion price$15.18 
Conversion premium at March 31, 202110.0 %
Conversion rate at March 31, 2021(1)(2)65.8762 
Conversion price at March 31, 2021(2)(3)$15.18 
Last conversion price calculation dateAugust 20, 2020
(1)Conversion rates denominated in shares of common stock per $1.0 thousand principal amount of the 2018 Convertible Notes converted.
(2)Represents conversion rate and conversion price, as applicable, taking into account certain de minimis adjustments that will be made on the conversion date.
(3)The conversion price in effect at March 31, 2021 was calculated on the last anniversary of the issuance and will be calculated again on the next anniversary, unless the exercise price shall have changed by more than 1.0% before the anniversary.
    The conversion rate will be subject to adjustment upon certain events, such as stock splits and combinations, mergers, spin-offs, increases in dividends in excess of $0.34 per share per quarter and certain changes in control. Certain of these adjustments, including adjustments for increases in dividends, are subject to a conversion price floor of $13.80 per share. In no event will the total number of shares of common stock issuable upon conversion exceed 72.4637 per $1 principal amount. We have determined that the embedded conversion option in the 2018 Convertible Notes is not required to be separately accounted for as a derivative under GAAP.
    The 2018 Convertible Notes are unsecured obligations and rank senior in right of payment to our existing and future indebtedness, if any, that is expressly subordinated in right of payment to the 2018 Convertible Notes; equal in right of payment to our existing and future unsecured indebtedness that is not so subordinated; effectively junior in right of payment to any of our secured indebtedness (including existing unsecured indebtedness that we later secure) to the extent of the value of the assets securing such indebtedness; and structurally junior to all existing and future indebtedness (including trade payables) incurred by our subsidiaries and financing vehicles. As reflected in Item 1. - Financial Statements - Note 11. Earnings Per Share, the issuance is considered part of the if-converted method for calculation of diluted earnings per share.
    The following table summarizes the interest expense, amortization of financing costs and amortization of premium incurred on the 2018 Convertible Notes for the three months ended March 31, 2021 and March 31, 2020:
 Three Months Ended
(in millions)March 31, 2021March 31, 2020
Interest expense$2.9 $2.9 
Amortization of financing costs$0.1 $0.1 
Amortization of premium$— (1)$— (1)
Weighted average interest rate5.8 %5.8 %
Effective interest rate5.9 %5.9 %
Average debt outstanding$201.3 $201.3 
(1)For the three months ended March 31, 2021 and March 31, 2020, the amortization of premium was less than $50.0 thousand.
    As of March 31, 2021 and December 31, 2020, the outstanding balance on the 2018 Convertible Notes was $201.2 million and $201.2 million, respectively, and NMFC was in compliance with the terms of the 2018A Indenture on such date.

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Unsecured Notes
On May 6, 2016, we issued $50.0 million in aggregate principal amount of our 2016 Unsecured Notes (the “2016 Unsecured Notes”), pursuant to a note purchase agreement, dated May 4, 2016, to an institutional investor in a private placement. On September 30, 2016, we entered into an amended and restated note purchase agreement (the "NPA") and issued an additional $40.0 million in aggregate principal amount of 2016 Unsecured Notes to institutional investors in a private placement. On February 16, 2021, we repaid all $90.0 million in aggregate principal amount of the issued and outstanding 2016 Unsecured Notes. On June 30, 2017, we issued $55.0 million in aggregate principal amount of five-year unsecured notes that mature on July 15, 2022 (the "2017A Unsecured Notes"), pursuant to the NPA and a supplement to the NPA. On January 30, 2018, we issued $90.0 million in aggregate principal amount of five year unsecured notes that mature on January 30, 2023 (the "2018A Unsecured Notes") pursuant to the NPA and a second supplement to the NPA. On July 5, 2018, we issued $50.0 million in aggregate principal amount of five year unsecured notes that mature on June 28, 2023 (the "2018B Unsecured Notes") pursuant to the NPA and a third supplement to the NPA (the "Third Supplement"). On April 30, 2019, we issued $116.5 million in aggregate principal amount of five year unsecured notes that mature on April 30, 2024 (the "2019A Unsecured Notes") pursuant to the NPA and a fourth supplement to the NPA. On January 29, 2021, we issued $200.0 million in aggregate principal amount of five year unsecured notes that mature on January 29, 2026 (the "2021A Unsecured Notes") pursuant to the NPA and a fifth supplement to the NPA. The NPA provides for future issuances of unsecured notes in separate series or tranches.
On February 5, 2021, we caused notices to be issued to holders of our 2016 Unsecured Notes regarding the exercise of our option to prepay all of our $90.0 million in aggregate principal amount of issued and outstanding 2016 Unsecured Notes, which was prepaid on February 16, 2021.
The 2016 Unsecured Notes bore interest at an annual rate of 5.313%, payable semi-annually on May 15 and November 15 of each year. The 2017A Unsecured Notes bear interest at an annual rate of 4.760%, payable semi-annually on January 15 and July 15 of each year. The 2018A Unsecured Notes bear interest at an annual rate of 4.870%, payable semi-annually on February 15 and August 15 of each year. The 2018B Unsecured Notes bear interest at an annual rate of 5.360%, payable semi-annually on January 15 and July 15 of each year. The 2019A Unsecured Notes bear interest at an annual rate of 5.494%, payable semi-annually on April 15 and October 15 of each year. The 2021A Unsecured Notes bear interest at an annual rate of 3.875%, payable semi-annually in arrears on January 29 and July 29 of each year, commencing on July 29, 2021. These interest rates are subject to increase in the event that: (i) subject to certain exceptions, the underlying unsecured notes or we cease to have an investment grade rating or (ii) the aggregate amount of our unsecured debt falls below $150.0 million.  In each such event, we have the option to offer to prepay the underlying unsecured notes at par, in which case holders of the underlying unsecured notes who accept the offer would not receive the increased interest rate. In addition, we are obligated to offer to prepay the underlying unsecured notes at par if the Investment Adviser, or an affiliate thereof, ceases to be our investment adviser or if certain change in control events occur with respect to the Investment Adviser. 
    The NPA contains customary terms and conditions for unsecured notes issued, including, without limitation, an option to offer to prepay all or a portion of the unsecured notes under its governance at par (plus a make-whole amount if applicable), affirmative and negative covenants such as information reporting, maintenance of our status as a BDC under the 1940 Act and a RIC under the Code, minimum stockholders’ equity, minimum asset coverage ratio, and prohibitions on certain fundamental changes at NMFC or any subsidiary guarantor, as well as customary events of default with customary cure and notice, including, without limitation, nonpayment, misrepresentation in a material respect, breach of covenant, cross-default under other indebtedness of NMFC or certain significant subsidiaries, certain judgments and orders, and certain events of bankruptcy. The Third Supplement includes additional financial covenants related to asset coverage as well as other terms.
    On September 25, 2018, we closed a registered public offering of $50.0 million in aggregate principal amount of our 5.75% Unsecured Notes that mature on October 1, 2023 (the "5.75% Unsecured Notes", together with the 2016 Unsecured Notes, 2017A Unsecured Notes, 2018A Unsecured Notes, 2018B Unsecured Notes, 2019A Unsecured Notes and the 2021A Unsecured Notes, the "Unsecured Notes"), pursuant to an indenture, dated August 20, 2018, as supplemented by a second supplemental indenture thereto, dated September 25, 2018 (together, the "2018B Indenture"). On October 17, 2018, in connection with the registered public offering, we issued an additional $1.8 million aggregate principal amount of the 5.75% Unsecured Notes pursuant to the exercise of an overallotment option by the underwriters of the 5.75% Unsecured Notes.
On March 8, 2021, we redeemed $51.8 million in aggregate principal amount of the 5.75% Unsecured Notes at a redemption price of 100% plus accrued and unpaid interest.
    The 5.75% Unsecured Notes bore interest at an annual rate of 5.75%, payable quarterly on January 1, April 1, July 1 and October 1 of each year. The 5.75% Unsecured Notes were listed on the New York Stock Exchange and traded under the trading symbol “NMFX” until September 13, 2020. On September 14, 2020, the 5.75% Unsecured Notes began trading on the NASDAQ Global Select Market (the "NASDAQ") under the ticker symbol "NMFCL", until redeemed on March 8, 2021.

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    The Unsecured Notes are unsecured obligations and rank senior in right of payment to our existing and future indebtedness, if any, that is expressly subordinated in right of payment to the Unsecured Notes; equal in right of payment to our existing and future unsecured indebtedness that is not so subordinated; effectively junior in right of payment to any of our secured indebtedness (including existing unsecured indebtedness that we later secure) to the extent of the value of the assets securing such indebtedness; and structurally junior to all existing and future indebtedness (including trade payables) incurred by our subsidiaries and financing vehicles.
    The following table summarizes the interest expense and amortization of financing costs incurred on the Unsecured Notes for the three months ended March 31, 2021 and March 31, 2020:
 Three Months Ended
(in millions)March 31, 2021March 31, 2020
Interest expense$6.5 $6.0 
Amortization of financing costs$1.3 $0.3 
Weighted average interest rate4.9 %5.3 %
Effective interest rate5.9 %5.6 %
Average debt outstanding$532.2 $453.3 
    As of March 31, 2021 and December 31, 2020, the outstanding balance on the Unsecured Notes was $511.5 million and $453.3 million, respectively, and we were in compliance with the terms of the NPA and the 2018B Indenture as of such dates, as applicable.
    SBA-guaranteed debentures—On August 1, 2014 and August 25, 2017, respectively, SBIC I and SBIC II received SBIC licenses from the SBA to operate as SBICs.
    The SBIC license allows SBICs to obtain leverage by issuing SBA-guaranteed debentures, subject to the issuance of a capital commitment by the SBA and other customary procedures. SBA-guaranteed debentures are non-recourse to us, interest only debentures with interest payable semi-annually and have a ten year maturity. The principal amount of SBA-guaranteed debentures is not required to be paid prior to maturity but may be prepaid at any time without penalty. The interest rate of SBA-guaranteed debentures is fixed on a semi-annual basis at a market-driven spread over U.S. Treasury Notes with ten year maturities. The SBA, as a creditor, will have a superior claim to the assets of SBIC I and SBIC II over our stockholders in the event SBIC I and SBIC II are liquidated or the SBA exercises remedies upon an event of default.
    The maximum amount of borrowings available under current SBA regulations for a single licensee is $150.0 million as long as the licensee has at least $75.0 million in regulatory capital, receives a capital commitment from the SBA and has been through an examination by the SBA subsequent to licensing. In June 2018, legislation amended the 1958 Act by increasing the individual leverage limit from $150.0 million to $175.0 million, subject to SBA approvals.
    As of March 31, 2021 and December 31, 2020, SBIC I had regulatory capital of $75.0 million and $75.0 million, respectively, and SBA-guaranteed debentures outstanding of $150.0 million and $150.0 million, respectively. As of March 31, 2021 and December 31, 2020, SBIC II had regulatory capital of $75.0 million and $75.0 million, respectively, and $150.0 million and $150.0 million, respectively, of SBA-guaranteed debentures outstanding. The SBA-guaranteed debentures incur upfront fees of 3.435%, which consists of a 1.00% commitment fee and a 2.435% issuance discount, which are amortized over the life of the SBA-guaranteed debentures.

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The following table summarizes our SBA-guaranteed debentures as of March 31, 2021:
(in millions)
Issuance DateMaturity DateDebenture AmountInterest RateSBA Annual Charge
Fixed SBA-guaranteed debentures(1):    
March 25, 2015March 1, 2025$37.5 2.517 %0.355 %
September 23, 2015September 1, 202537.5 2.829 %0.355 %
September 23, 2015September 1, 202528.8 2.829 %0.742 %
March 23, 2016March 1, 202613.9 2.507 %0.742 %
September 21, 2016September 1, 20264.0 2.051 %0.742 %
September 20, 2017September 1, 202713.0 2.518 %0.742 %
March 21, 2018March 1, 202815.3 3.187 %0.742 %
Fixed SBA-guaranteed debentures(2):
September 19, 2018September 1, 202815.0 3.548 %0.222 %
September 25, 2019September 1, 202919.0 2.283 %0.222 %
March 25, 2020March 1, 203041.0 2.078 %0.222 %
March 25, 2020March 1, 203024.0 2.078 %0.275 %
September 23, 2020September 1, 203051.0 1.034 %0.275 %
Total SBA-guaranteed debentures $300.0   
(1)SBA-guaranteed debentures are held in SBIC I.
(2)SBA-guaranteed debentures are held in SBIC II.
    Prior to pooling, the SBA-guaranteed debentures bear interest at an interim floating rate of LIBOR plus 0.30%. Once pooled, which occurs in March and September each year, the SBA-guaranteed debentures bear interest at a fixed rate that is set to the current 10-year treasury rate plus a spread at each pooling date.
    The following table summarizes the interest expense and amortization of financing costs incurred on the SBA-guaranteed debentures for the three months ended March 31, 2021 and March 31, 2020:
 Three Months Ended
(in millions)March 31, 2021March 31, 2020
Interest expense$2.0 $1.8 
Amortization of financing costs$0.2 $0.2 
Weighted average interest rate2.7 %3.0 %
Effective interest rate3.0 %3.4 %
Average debt outstanding$300.0 $243.1 
    The SBIC program is designed to stimulate the flow of private investor capital into eligible smaller businesses, as defined by the SBA. Under SBA regulations, SBICs are subject to regulatory requirements, including making investments in SBA-eligible businesses, investing at least 25.0% of its investment capital in eligible smaller businesses, as defined under the 1958 Act, placing certain limitations on the financing terms of investments, regulating the types of financing, prohibiting investments in small businesses with certain characteristics or in certain industries and requiring capitalization thresholds that limit distributions to us. SBICs are subject to an annual periodic examination by an SBA examiner to determine the SBIC's compliance with the relevant SBA regulations and an annual financial audit of its financial statements that are prepared on a basis of accounting other than GAAP (such as ASC 820) by an independent auditor. As of March 31, 2021 and December 31, 2020, SBIC I and SBIC II were in compliance with SBA regulatory requirements.

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Off-Balance Sheet Arrangements
    We may become a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financial needs of our portfolio companies. These instruments may include commitments to extend credit and involve, to varying degrees, elements of liquidity and credit risk in excess of the amount recognized in the balance sheet. As of March 31, 2021 and December 31, 2020, we had outstanding commitments to third parties to fund investments totaling $100.3 million and $73.1 million, respectively, under various undrawn revolving credit facilities, delayed draw commitments or other future funding commitments.
    We may from time to time enter into financing commitment letters or bridge financing commitments, which could require funding in the future. As of March 31, 2021 and December 31, 2020, we had commitment letters to purchase investments in an aggregate par amount of $0 and $44.9 million, respectively. As of March 31, 2021 and December 31, 2020, we had not entered into any bridge financing commitments which could require funding in the future.
As of March 31, 2021, we had unfunded commitments related to an equity investment in SLP III of $10.0 million, which may be funded at our discretion.
Contractual Obligations
    A summary of our significant contractual payment obligations as of March 31, 2021 is as follows:
 Contractual Obligations Payments Due by Period
(in millions)TotalLess than
1 Year
1 - 3 Years3 - 5 YearsMore than
5 Years
Holdings Credit Facility(1)$450.2 $— $450.2 $— $— 
Unsecured Notes(2)511.5 — 195.0 316.5 — 
SBA-guaranteed debentures(3)300.0 — — 117.7 182.3 
DB Credit Facility(4)201.0 — — 201.0 — 
Convertible Notes(5)201.2 — 201.2 — — 
NMFC Credit Facility(6)107.0 — 107.0 — — 
Total Contractual Obligations$1,770.9 $— $953.4 $635.2 $182.3 
(1)Under the terms of the $745.0 million Holdings Credit Facility, all outstanding borrowings under that facility ($450.2 million as of March 31, 2021) must be repaid on or before September 30, 2023. As of March 31, 2021, there was approximately $294.8 million of possible capacity remaining under the Holdings Credit Facility.
(2)$55.0 million of the 2017A Unsecured Notes will mature on July 15, 2022 unless earlier repurchased, $90.0 million of the 2018A Unsecured Notes will mature on January 30, 2023 unless earlier repurchased, $50.0 million of the 2018B Unsecured Notes will mature on June 28, 2023 unless earlier repurchased, $116.5 million of the 2019A Unsecured Notes will mature on April 30, 2024 unless earlier repurchased and $200.0 million of the 2021A Unsecured Notes will mature on January 29, 2026 unless earlier repurchased.
(3)Our SBA-guaranteed debentures will begin to mature on March 1, 2025.
(4)Under the terms of the $280.0 million DB Credit Facility, all outstanding borrowings under that facility ($201.0 million as of March 31, 2021) must be repaid on or before March 25, 2026. As of March 31, 2021, there was approximately $79.0 million of possible capacity remaining under the DB Credit Facility.
(5)The 2018 Convertible Notes will mature on August 15, 2023 unless earlier converted or repurchased at the holder's option or redeemed by us.
(6)Under the terms of the $188.5 million NMFC Credit Facility, all outstanding borrowings under that facility ($107.0 million as of March 31, 2021) must be repaid on or before June 4, 2022. As of March 31, 2021, there was approximately $81.5 million of available capacity remaining under the NMFC Credit Facility.

    We have entered into an investment management and advisory agreement (the "Investment Management Agreement") with the Investment Adviser in accordance with the 1940 Act. Under the Investment Management Agreement, the Investment Adviser has agreed to provide us with investment advisory and management services. We have agreed to pay for these services (1) a management fee and (2) an incentive fee based on our performance.
    We have also entered into the administration agreement, as amended and restated (the "Administration Agreement") with the Administrator. Under the Administration Agreement, the Administrator has agreed to arrange office space for us and provide office equipment and clerical, bookkeeping and record keeping services and other administrative services necessary to
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conduct our respective day-to-day operations. The Administrator has also agreed to maintain, or oversee the maintenance of, our financial records, our reports to stockholders and reports filed with the SEC.
    If any of the contractual obligations discussed above are terminated, our costs under any new agreements that are entered into may increase. In addition, we would likely incur significant time and expense in locating alternative parties to provide the services we expect to receive under the Investment Management Agreement and the Administration Agreement.
Distributions and Dividends
    Distributions declared and paid to stockholders for the three months ended March 31, 2021 totaled approximately $29.0 million.
    The following table reflects cash distributions, including dividends and returns of capital, if any, per share that have been declared by our board of directors for the two most recent fiscal years and the current fiscal year to date:
Fiscal Year EndedDate DeclaredRecord DatePayment DatePer Share
Amount (1)
December 31, 2021
First QuarterFebruary 17, 2021March 17, 2021March 31, 2021$0.30 
$0.30 
December 31, 2020
Fourth QuarterOctober 28, 2020December 16, 2020December 30, 2020$0.30 
Third QuarterJuly 29, 2020September 16, 2020September 30, 20200.30 
Second QuarterApril 29, 2020June 16, 2020June 30, 20200.30 
First QuarterFebruary 19, 2020March 13, 2020March 27, 20200.34 
$1.24 
December 31, 2019
Fourth QuarterNovember 4, 2019December 13, 2019December 27, 2019$0.34 
Third QuarterAugust 1, 2019September 13, 2019September 27, 20190.34 
Second QuarterMay 1, 2019June 14, 2019June 28, 20190.34 
First QuarterFebruary 22, 2019March 15, 2019March 29, 20190.34 
$1.36 
(1)Tax characteristics of all distributions paid are reported to stockholders on Form 1099 after the end of the calendar year. For the years ended December 31, 2020 and December 31, 2019, total distributions were $120.1 million and $117.4 million, respectively, of which the distributions were comprised of approximately 84.58% and 72.01%, respectively, of ordinary income, 0.00% and 0.00%, respectively, of long-term capital gains and approximately 15.42% and 27.99%, respectively, of a return of capital. Future quarterly distributions, if any, will be determined by our board of directors.
    We intend to pay quarterly distributions to our stockholders in amounts sufficient to maintain our status as a RIC. We intend to distribute approximately all of our net investment income on a quarterly basis and substantially all of our taxable income on an annual basis, except that we may retain certain net capital gains for reinvestment.
    We maintain an "opt out" dividend reinvestment plan on behalf of our common stockholders, pursuant to which each of our stockholders' cash distributions will be automatically reinvested in additional shares of common stock, unless the stockholder elects to receive cash. See Item 1— Financial Statements—Note 2. Summary of Significant Accounting Policies for additional details regarding our dividend reinvestment plan.
Related Parties
    We have entered into a number of business relationships with affiliated or related parties, including the following:
We have entered into the Investment Management Agreement with the Investment Adviser, a wholly-owned subsidiary of New Mountain Capital. Therefore, New Mountain Capital is entitled to any profits earned by the Investment Adviser, which includes any fees payable to the Investment Adviser under the terms of the Investment Management Agreement, less expenses incurred by the Investment Adviser in performing its services under the Investment Management Agreement.
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We have entered into the Administration Agreement with the Administrator, a wholly-owned subsidiary of New Mountain Capital. The Administrator arranges our office space and provides office equipment and administrative services necessary to conduct our respective day-to-day operations pursuant to the Administration Agreement. We reimburse the Administrator for the allocable portion of overhead and other expenses incurred by it in performing its obligations to us under the Administration Agreement, which includes the fees and expenses associated with performing administrative, finance, and compliance functions, and the compensation of our chief financial officer and chief compliance officer and their respective staffs. Pursuant to the Administration Agreement and further restricted by us, the Administrator may, in its own discretion, submit to us for reimbursement some or all of the expenses that the Administrator has incurred on our behalf during any quarterly period. As a result, the amount of expenses for which we will have to reimburse the Administrator may fluctuate in future quarterly periods and there can be no assurance given as to when, or if, the Administrator may determine to limit the expenses that the Administrator submits to us for reimbursement in the future. However, it is expected that the Administrator will continue to support part of our expense burden in the near future and may decide to not calculate and charge through certain overhead related amounts as well as continue to cover some of the indirect costs. The Administrator cannot recoup any expenses that the Administrator has previously waived. For the three months ended March 31, 2021 approximately $0.8 million of indirect administrative expenses were included in administrative expenses, of which approximately $0.0 million were waived by the Administrator. As of March 31, 2021, approximately $1.5 million of indirect administrative expenses were included in payable to affiliates. For the three months ended March 31, 2021, the reimbursement to the Administrator represented approximately 0.02% of our gross assets.
We, the Investment Adviser and the Administrator have entered into a royalty-free Trademark License Agreement, as amended, with New Mountain Capital, pursuant to which New Mountain Capital has agreed to grant us, the Investment Adviser and the Administrator a non-exclusive, royalty-free license to use the name "New Mountain" and "New Mountain Finance".
    In addition, we have adopted a formal code of ethics that governs the conduct of our officers and directors, which is available on our website at http://www.newmountainfinance.com. These officers and directors also remain subject to the duties imposed by the 1940 Act and the Delaware General Corporation Law.
    The Investment Adviser and its affiliates may also manage other funds in the future that may have investment mandates that are similar, in whole or in part, to our investment mandates. The Investment Adviser and its affiliates may determine that an investment is appropriate for us and for one or more of those other funds. In such event, depending on the availability of such investment and other appropriate factors, the Investment Adviser or its affiliates may determine that we should invest side-by-side with one or more other funds. Any such investments will be made only to the extent permitted by applicable law and interpretive positions of the SEC and its staff, and consistent with the Investment Adviser's allocation procedures. On October 8, 2019, the SEC issued an exemptive order (the “Exemptive Order”), which superseded a prior order issued on December 18, 2017, which permits us to co-invest in portfolio companies with certain funds or entities managed by the Investment Adviser or its affiliates in certain negotiated transactions where co-investing would otherwise be prohibited under the 1940 Act, subject to the conditions of the Exemptive Order. Pursuant to the Exemptive Order, we are permitted to co-invest with our affiliates if a “required majority” (as defined in Section 57(o) of the 1940 Act) of our independent directors make certain conclusions in connection with a co-investment transaction, including, but not limited to, that (1) the terms of the potential co-investment transaction, including the consideration to be paid, are reasonable and fair to us and our stockholders and do not involve overreaching in respect of us or our stockholders on the part of any person concerned, and (2) the potential co-investment transaction is consistent with the interests of our stockholders and is consistent with our then-current investment objective and strategies.
    On March 30, 2020, an affiliate of the Investment Adviser purchased directly from NMNLC 105,030 shares of NMNLC’s common stock at a price of $107.73 per share, which represented the net asset value per share of NMNLC at the date of purchase, for an aggregate purchase price of approximately $11.3 million. Immediately thereafter, NMNLC redeemed 105,030 shares of its common stock held by NMFC in exchange for a promissory note with a principal amount of $11.3 million and a 7.0% interest rate, which was repaid by NMNLC to NMFC on March 31, 2020.
    On March 30, 2020, we entered into the Unsecured Management Company Revolver with NMF Investments III, L.L.C., an affiliate of the Investment Adviser, with a $30.0 million maximum amount of revolver borrowings available and a maturity date of December 31, 2022. On May 4, 2020, we entered into an Amended and Restated Uncommitted Revolving Loan Agreement with NMF Investments III, L.L.C., which increased the maximum amounts of revolving borrowings available thereunder from $30.0 million to $50.0 million. Refer to Borrowings for discussion of the Unsecured Management Company Revolver.
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Item 3.     Quantitative and Qualitative Disclosures About Market Risk
    We are subject to certain financial market risks, such as interest rate fluctuations. In addition, U.S. and global capital markets and credit markets have experienced a higher level of stress due to the global COVID-19 pandemic, which has resulted in an increase in the level of volatility across such markets and a general decline in value of the securities that we hold. Because we fund a portion of our investments with borrowings, our net investment income is affected by the difference between the rate at which we invest and the rate at which we borrow. As a result, there can be no assurance that a significant change in market interest rates will not have a material adverse effect on our net investment income. In connection with the COVID-19 pandemic, the U.S. Federal Reserve and other central banks have reduced certain interest rates and LIBOR has decreased. In addition, in a prolonged low interest rate environment, including a reduction of LIBOR to zero, the difference between the total interest income earned on interest earning assets and the total interest expense incurred on interest bearing liabilities may be compressed, reducing our net interest income and potentially adversely affecting our operating results. During the three months ended March 31, 2021, certain of the loans held in our portfolio had floating interest rates. As of March 31, 2021, approximately 92.59% of investments at fair value (excluding investments on non-accrual, unfunded debt investments and non-interest bearing equity investments) represent floating-rate investments with a LIBOR floor (includes investments bearing prime interest rate contracts) and approximately 7.41% of investments at fair value represent fixed-rate investments. Additionally, our senior secured revolving credit facilities are also subject to floating interest rates and are currently paid based on floating LIBOR rates.
    The following table estimates the potential changes in net cash flow generated from interest income and expenses, should interest rates increase by 100, 200 or 300 basis points, or decrease by 25 basis points. Interest income is calculated as revenue from interest generated from our portfolio of investments held on March 31, 2021. Interest expense is calculated based on the terms of our outstanding revolving credit facilities, convertible notes and unsecured notes. For our floating rate credit facilities, we use the outstanding balance as of March 31, 2021. Interest expense on our floating rate credit facilities is calculated using the interest rate as of March 31, 2021, adjusted for the hypothetical changes in rates, as shown below. The base interest rate case assumes the rates on our portfolio investments remain unchanged from the actual effective interest rates as of March 31, 2021. These hypothetical calculations are based on a model of the investments in our portfolio, held as of March 31, 2021, and are only adjusted for assumed changes in the underlying base interest rates.
    Actual results could differ significantly from those estimated in the table.
Change in Interest RatesEstimated
Percentage
Change in Interest
Income Net of
Interest Expense (unaudited)
-25 Basis Points0.01 %
Base Interest Rate— %
+100 Basis Points2.67 %
+200 Basis Points13.26 %
+300 Basis Points23.84 %


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Item 4.     Controls and Procedures
(a)Evaluation of Disclosure Controls and Procedures 
As of March 31, 2021 (the end of the period covered by this report), we, including our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) of the Exchange Act. Based on that evaluation, our management, including the Chief Executive Officer and Chief Financial Officer, concluded that our disclosure controls and procedures were effective and provided reasonable assurance that information required to be disclosed in our periodic SEC filings is recorded, processed, summarized and reported within the time periods specified in the SEC rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. However, in evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated can provide only reasonable assurance of achieving the desired control objectives, and management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of such possible controls and procedures.
(b)Changes in Internal Controls Over Financial Reporting
Management has not identified any change in our internal control over financial reporting that occurred during the quarter ended March 31, 2021 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

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PART II. OTHER INFORMATION
The terms “we”, “us”, “our” and the “Company” refers to New Mountain Finance Corporation and its consolidated subsidiaries.
Item 1.    Legal Proceedings
    We, and our consolidated subsidiaries, the Investment Adviser and the Administrator are not currently subject to any material pending legal proceedings as of March 31, 2021. From time to time, we or our consolidated subsidiaries may be a party to certain legal proceedings incidental to the normal course of our business including the enforcement of our rights under contracts with our portfolio companies. While the outcome of these legal proceedings cannot be predicted with certainty, we do not expect that these proceedings will have a material effect upon our business, financial condition or results of operations.
Item 1A. Risk Factors
    In addition to the other information set forth in this report, you should carefully consider the factors discussed in Item 1A. Risk Factors in our Annual Report on Form 10-K for the fiscal year ended December 31, 2020, which could materially affect our business, financial condition and/or operating results, including the Risk Factor titled "Small Business Credit Availability Act allows us to incur additional leverage, which could increase the risk of investing in our securities". The risks described in our Annual Report on Form 10-K are not the only risks facing us. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially and adversely affect our business, financial condition and/or operating results. Other than as set forth below, there have been no material changes during the three months ended March 31, 2021 to the risk factors discussed in Item 1A. Risk Factors in our Annual Report on Form 10-K for the year ended December 31, 2020.
The interest rates of our term loans to our portfolio companies that extend beyond 2021 might be subject to change based on recent regulatory changes.
LIBOR, the London Interbank Offered Rate, is the basic rate of interest used in lending transactions between banks on the London interbank market and is widely used as a reference for setting the interest rate on loans globally. We typically use LIBOR as a reference rate in floating-rate loans we extend to portfolio companies such that the interest due to us pursuant to term loan extended to a portfolio company is calculated using LIBOR. The terms of our debt investments generally include minimum interest rate floors which are calculated based on LIBOR.
On March 5, 2021, the United Kingdom’s Financial Conduct Authority (the “FCA”), which regulates LIBOR, announced that (i) 24 LIBOR settings would cease to exist immediately after December 31, 2021 (all seven euro LIBOR settings; all seven Swiss franc LIBOR settings; the Spot Next, 1-week, 2-month, and 12-month Japanese yen LIBOR settings; the overnight, 1-week, 2-month, and 12-month sterling LIBOR settings; and the 1-week and 2-month US dollar LIBOR settings); (ii) the overnight and 12-month US LIBOR settings would cease to exist after June 30, 2023; and (iii) the FCA would consult on whether the remaining nine LIBOR settings should continue to be published on a synthetic basis for a certain period using the FCA’s proposed new powers that the UK government is legislating to grant to them. Central banks and regulators in a number of major jurisdictions (for example, United States, United Kingdom, European Union, Switzerland and Japan) have convened working groups to find, and implement the transition to, suitable replacements for interbank offered rates. To identify a successor rate for U.S. dollar LIBOR, the Alternative Reference Rates Committee (“ARRC”), a U.S.-based group convened by the Federal Reserve Board and the Federal Reserve Bank of New York, was formed. The ARRC has identified the Secured Overnight Financing Rate (“SOFR”) as its preferred alternative rate for LIBOR. SOFR is a measure of the cost of borrowing cash overnight, collateralized by U.S. Treasury securities, and is based on directly observable U.S. Treasury-backed repurchase transactions. Although SOFR appears to be the preferred replacement rate for U.S. dollar LIBOR, at this time, it is not possible to predict the effect of any such changes, any establishment of alternative reference rates or other reforms to LIBOR that may be enacted in the United States, United Kingdom or elsewhere or, whether the COVID-19 pandemic will have further effect on LIBOR transition plans.
The elimination of LIBOR or any other changes or reforms to the determination or supervision of LIBOR could have an adverse impact on the market for or value of any LIBOR-indexed, floating-rate debt securities, loans, and other financial obligations or extensions of credit held by or due to us or on our overall financial condition or results of operations. If LIBOR ceases to exist, we may need to renegotiate the credit agreements extending beyond 2021 with our portfolio companies that utilize LIBOR as a factor in determining the interest rate to replace LIBOR with the new standard that is established. In the event that the LIBOR rate is no longer available or published on a current basis or no longer made available or used for determining the interest rate of loans, our administrative agent that manages our loans will generally select a comparable successor rate; provided that (i) to the extent a comparable or successor rate is approved by the administrative agent, the approved rate shall be applied in a manner consistent with market practice; and (ii) to the extent such market practice is not administratively feasible for the administrative agent, such approved rate shall be applied as otherwise reasonably determined by the administrative agent.
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We are subject to risks related to corporate social responsibility.
Our business faces increasing public scrutiny related to environmental, social and governance (“ESG”) activities. We risk damage to our brand and reputation if we fail to act responsibly in a number of areas, such as environmental stewardship, corporate governance and transparency and considering ESG factors in our investment processes. Adverse incidents with respect to ESG activities could impact the value of our brand, the cost of our operations and relationships with investors, all of which could adversely affect our business and results of operations. Additionally, new regulatory initiatives related to ESG could adversely affect our business.

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Item 2.    Unregistered Sales of Equity Securities and Use of Proceeds
    We did not engage in unregistered sales of equity securities during the three months ended March 31, 2021.
Issuer Purchases of Equity Securities
Dividend Reinvestment Plan
    During the quarter ended March 31, 2021, we did not purchase any of our common stock in the open market in connection with our dividend reinvestment plan.
Stock Repurchase Program
    On February 4, 2016, our board of directors authorized a program for the purpose of repurchasing up to $50.0 million worth of our common stock (the "Repurchase Program"). Under the Repurchase Program, we were permitted, but were not obligated to, repurchase our outstanding common stock in the open market from time to time, provided that we complied with our code of ethics and the guidelines specified in Rule 10b-18 of the Exchange Act, including certain price, market volume and timing constraints. In addition, any repurchases were conducted in accordance with the 1940 Act. On December 31, 2020, our board of directors extended our Repurchase Program and we expect the Repurchase Program to be in place until the earlier of December 31, 2021 or until $50.0 million of outstanding shares of common stock have been repurchased. We did not repurchase any shares of our common stock under the Repurchase Program during the quarter ended March 31, 2021.
Item 3.     Defaults Upon Senior Securities
    None.
Item 4.    Mine Safety Disclosures
    Not applicable.
Item 5.    Other Information
    Overall, New Mountain Capital's team now exceeds 175 people vs. 84 people at the time of NMFC's IPO in 2011. New Mountain Capital now has seven Managing Director level team members dedicated to its credit activities vs. one at the time of NMFC’s IPO in 2011. Going forward, Robert A. Hamwee is expected to remain as NMFC's CEO and the most senior Managing Director in the credit area, but with the freedom to allocate half of his time to activities outside of credit and NMFC. As part of his responsibilities, Mr. Hamwee will continue to: (i) serve as the Company’s Chief Executive Officer, (ii) serve as a senior member of the Investment Committee of the Company’s investment adviser, and (iii) be involved in other parts of leadership, which the Company’s board of directors considers core to the Company’s performance. Meanwhile, John Kline will become co-portfolio manager of the Company in addition to already being its President and Chief Operating Officer. Mr. Kline joined New Mountain in 2008 and has been a senior manager within New Mountain Capital's credit effort since its beginning. The Company’s investment adviser believes that its management team, with the overall support of New Mountain Capital’s team, is adequately staffed to support the Company’s Co-Portfolio Managers, Messrs. Hamwee and Kline, in managing the Company’s investment portfolio.
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Item 6.     Exhibits
(a)Exhibits
The following exhibits are filed as part of this report or hereby incorporated by reference to exhibits previously filed with the United States Securities and Exchange Commission:
Exhibit
Number
Description
3.1(a)
3.1(b)
3.2 
3.3 
4.1 
10.1
10.2
10.3
31.1 
31.2 
32.1 
32.2 
(1)Previously filed in connection with New Mountain Finance Holdings, L.L.C.’s registration statement on Form N-2 Pre-Effective Amendment No. 3 (File Nos. 333-168280 and 333-172503) filed on May 9, 2011.
(2)Previously filed in connection with New Mountain Finance Corporation’s quarterly report on Form 10-Q filed on August 11, 2011.
(3)Previously filed in connection with New Mountain Finance Corporation and New Mountain Finance AIV Holdings Corporation report on Form 8-K filed on August 25, 2011.
(4)Previously filed in connection with New Mountain Finance Corporation's report on Form 8-K filed on April 3, 2019.
(5)Previously filed in connection with New Mountain Finance Corporation's report on Form 8-K filed on March 31, 2021.
(6)Previously filed in connection with New Mountain Finance Corporation's report on Form 8-K filed on April 26, 2021.
(7)Previously filed in connection with New Mountain Finance Corporation's report on Form 8-K filed on May 5, 2021.
*Filed herewith.



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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized on May 5, 2021.
 NEW MOUNTAIN FINANCE CORPORATION
  
 By:/s/ ROBERT A. HAMWEE
  Robert A. Hamwee
  Chief Executive Officer
  (Principal Executive Officer), and Director
  
 By:/s/ SHIRAZ Y. KAJEE
  Shiraz Y. Kajee
  Chief Financial Officer
  (Principal Financial and Accounting Officer)
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