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Section 1: 10-Q (10-Q)

Table of Contents

 

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 


 

FORM 10-Q

 


 

x

Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

For the Quarter Ended September 30, 2011

 

o

Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

Commission File Number: 814-00839

 


 

NEW MOUNTAIN FINANCE HOLDINGS, L.L.C

(Exact name of registrant as specified in its charter)

 


 

Delaware

 

26-3633318

(State or other jurisdiction of
incorporation or organization)

 

(I.R.S. Employer
Identification No.)

 

787 Seventh Avenue
48
th Floor
New York, N.Y.

 

10019

(Address of principal executive offices)

 

(Zip Code)

 

(212) 730-0300

(Registrant’s telephone number, including area code)

 


 

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 during the preceding 12 months and (2) has been subject to such filing requirements for the past 90 days. Yes x  No o

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted 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 and post such files). Yes o  No o

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check one):

 

Large accelerated filer o

 

Accelerated filer o

 

 

 

Non-accelerated filer x

 

Smaller Reporting Company 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 x

 

The number of the registrant’s common membership units outstanding as of November 14, 2011 was 30,919,629.

 

 

 



Table of Contents

 

NEW MOUNTAIN FINANCE HOLDINGS, L.L.C.

 

FORM 10-Q FOR THE QUARTER ENDED SEPTEMBER 30, 2011

TABLE OF CONTENTS

 

 

PAGE

 

 

PART I. FINANCIAL INFORMATION

2

 

 

Item 1.

Financial Statements

2

 

 

 

 

Consolidated Statements of Assets, Liabilities and Members’ Capital as of September 30, 2011 (unaudited) and December 31, 2010

2

 

 

 

 

Consolidated Statements of Operations for the three and nine months ended September 30, 2011 (unaudited) and September 30, 2010 (unaudited)

3

 

 

 

 

Consolidated Statements of Changes in Members’ Capital for the nine months ended September 30, 2011 (unaudited) and September 30, 2010 (unaudited)

4

 

 

 

 

Consolidated Statements of Cash Flows for the nine months ended September 30, 2011 (unaudited) and September 30, 2010 (unaudited)

5

 

 

 

 

Consolidated Schedule of Investments as of September 30, 2011 (unaudited)

6

 

 

 

 

Consolidated Schedule of Investments as of December 31, 2010

10

 

 

 

 

Notes to Consolidated Financial Statements (unaudited)

13

 

 

 

 

Report of Independent Registered Public Accounting Firm

28

 

 

 

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

29

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

43

Item 4.

Controls and Procedures

43

 

 

PART II. OTHER INFORMATION

44

 

 

Item 1.

Legal Proceedings

44

Item 1A.

Risk Factors

44

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

44

Item 3.

Defaults upon Senior Securities

44

Item 4.

Reserved

44

Item 5.

Other Information

44

Item 6.

Exhibits

45

 

Signatures

47

 



Table of Contents

 

PART I. FINANCIAL INFORMATION

 

Item 1.            Financial Statements

 

New Mountain Finance Holdings, L.L.C.

 

Consolidated Statements of Assets, Liabilities and Members’ Capital

 

 

 

September 30, 2011

 

December 31, 2010

 

 

 

(unaudited)

 

 

 

Assets

 

 

 

 

 

Investments at fair value (cost of $606,704,749 and $414,308,823, respectively)

 

$

604,334,414

 

$

441,057,840

 

Cash and cash equivalents

 

18,438,567

 

10,744,082

 

Interest receivable

 

6,761,269

 

3,007,787

 

Receivable from unsettled securities sold

 

6,755,000

 

 

Deferred credit facility costs (net of accumulated amortization of $610,866 and $69,909, respectively)

 

3,766,729

 

1,880,120

 

Deferred offering costs

 

 

3,528,110

 

Receivable from affiliate

 

1,003,530

 

 

Other assets

 

521,556

 

5,842

 

Total assets

 

$

641,581,065

 

$

460,223,781

 

 

 

 

 

 

 

Liabilities

 

 

 

 

 

SLF Credit Facility

 

166,606,448

 

56,936,000

 

Holdings Credit Facility

 

57,903,125

 

59,696,938

 

Payable for unsettled securities purchased

 

 

94,462,500

 

Management fee payable

 

1,930,140

 

 

Incentive fee payable

 

700,610

 

 

Interest payable

 

1,229,640

 

813,192

 

Payable to affiliates

 

 

2,531,319

 

Other liabilities

 

1,289,898

 

3,856,571

 

Total liabilities

 

229,659,861

 

218,296,520

 

 

 

 

 

 

 

Members’ Capital

 

411,921,204

 

241,927,261

 

Total liabilities and members’ capital

 

$

641,581,065

 

$

460,223,781

 

Outstanding common membership units (a)

 

30,919,629

 

 

 

Capital per unit (a)

 

$

13.32

 

 

 

 


(a)          Fund was not unitized as of December 31, 2010.

 

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

 

2



Table of Contents

 

New Mountain Finance Holdings, L.L.C.

 

Consolidated Statements of Operations

(unaudited)

 

 

 

Three months ended

 

Nine months ended

 

 

 

September 30,
2011

 

September 30,
2010

 

September 30,
2011

 

September 30,
2010

 

Investment income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

$

14,860,750

 

$

13,598,152

 

$

38,838,944

 

$

30,818,117

 

Other income

 

207,831

 

282,837

 

557,648

 

736,771

 

Total investment income

 

15,068,581

 

13,880,989

 

39,396,592

 

31,554,888

 

 

 

 

 

 

 

 

 

 

 

Expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest and other credit facility expenses

 

1,686,113

 

688,686

 

4,767,013

 

1,910,649

 

Management fee

 

1,930,140

 

17,751

 

2,737,649

 

53,249

 

Incentive fee

 

700,610

 

 

1,205,003

 

 

Professional fees (net of reimbursable expenses of $816,530, $0, $946,716 and $0, respectively)

 

55,138

 

(78,628

)

624,972

 

114,714

 

Administrative expenses (net of reimbursable expenses of $218,396, $0, $398,651 and $0, respectively)

 

314,250

 

87,858

 

517,668

 

284,537

 

Other general and administrative expenses

 

380,612

 

20,668

 

559,180

 

62,368

 

Total expenses

 

5,066,863

 

736,335

 

10,411,485

 

2,425,517

 

Net investment income

 

10,001,718

 

13,144,654

 

28,985,107

 

29,129,371

 

 

 

 

 

 

 

 

 

 

 

Realized gains on investments

 

1,402,671

 

18,695,670

 

13,954,834

 

47,889,272

 

Net change in unrealized (depreciation) appreciation of investments

 

(22,657,239

)

(13,135,223

)

(29,119,352

)

(29,539,318

)

Net (decrease) increase in capital resulting from operations

 

$

(11,252,850

)

$

18,705,101

 

$

13,820,589

 

$

47,479,325

 

 

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

 

3



Table of Contents

 

New Mountain Finance Holdings, L.L.C.

 

Consolidated Statements of Changes in Members’ Capital

(unaudited)

 

 

 

Nine months ended

 

Nine months ended

 

 

 

September 30, 2011

 

September 30, 2010

 

Increase (decrease) in members’ capital resulting from operations:

 

 

 

 

 

Net investment income

 

$

28,985,107

 

$

29,129,371

 

Realized gains on investments

 

13,954,834

 

47,889,272

 

Net change in unrealized (depreciation) appreciation of investments

 

(29,119,352

)

(29,539,318

)

Net increase in members’ capital resulting from operations

 

13,820,589

 

47,479,325

 

Distributions

 

(10,249,155

)

(71,570,191

)

Contributions

 

195,294,674

 

53,549,727

 

Dividends paid

 

(17,314,992

)

 

Offering costs

 

(11,557,173

)

 

Net increase in members’ capital

 

169,993,943

 

29,458,861

 

Members’ capital at beginning of period

 

241,927,261

 

239,440,683

 

Members’ capital at end of period

 

$

411,921,204

 

$

268,899,544

 

 

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

 

4



Table of Contents

 

New Mountain Finance Holdings, L.L.C.

 

Consolidated Statements of Cash Flows

(unaudited)

 

 

 

Nine months ended

 

 

 

September 30, 2011

 

September 30, 2010

 

Cash flows from operating activities

 

 

 

 

 

Net increase in capital resulting from operations

 

$

13,820,589

 

$

47,479,325

 

Adjustments to reconcile net (increase) decrease in capital resulting from operations to net cash (used in) provided by operating activities:

 

 

 

 

 

Realized gains on investments

 

(13,954,834

)

(47,889,272

)

Net change in unrealized depreciation (appreciation) of investments

 

29,119,352

 

29,539,318

 

Amortization of purchase discount

 

(5,048,033

)

(13,812,206

)

Amortization of deferred credit facility costs

 

540,957

 

 

Non-cash interest

 

(957,171

)

(1,231,190

)

(Increase) decrease in operating assets:

 

 

 

 

 

Purchase of investments

 

(355,424,928

)

(131,240,778

)

Proceeds from sales and paydowns of investments

 

182,264,633

 

156,845,630

 

Cash received for purchase of undrawn portion of revolving credit facility

 

1,260,000

 

 

Cash paid for sale of undrawn portion of revolving credit facility

 

 

(1,837,500

)

Cash paid for drawn revolver

 

(535,593

)

 

Interest receivable

 

(3,753,482

)

(3,682,468

)

Receivable from unsettled securities sold

 

(6,755,000

)

(5,270,124

)

Receivable from affiliate

 

(1,003,530

)

 

Other assets

 

(515,714

)

(20,675

)

Increase (decrease) in operating liabilities:

 

 

 

 

 

Payable for unsettled securities purchased

 

(94,462,500

)

(10,394,765

)

Management fee payable

 

1,930,140

 

 

Incentive fee payable

 

700,610

 

 

Interest payable

 

416,448

 

87,437

 

Payable to affiliates

 

(202,180

)

(331,154

)

Other liabilities

 

525,198

 

268,254

 

Net cash flows (used in) provided by operating activities

 

(252,035,038

)

18,509,832

 

Cash flows from financing activities

 

 

 

 

 

Contributions

 

195,294,674

 

53,549,727

 

Distributions

 

(10,249,155

)

(71,570,191

)

Dividends paid

 

(17,314,992

)

 

Offering costs paid

 

(11,500,044

)

 

Proceeds from Holdings Credit Facility

 

205,870,450

 

43,650,495

 

Repayment of Holdings Credit Facility

 

(207,664,263

)

(38,637,548

)

Proceeds from SLF Credit Facility

 

134,361,800

 

 

Repayment of SLF Credit Facility

 

(24,691,352

)

 

Deferred credit facility costs paid

 

(4,377,595

)

 

Net cash flows provided by (used in) financing activities

 

259,729,523

 

(13,007,517

)

Net increase in cash and cash equivalents

 

7,694,485

 

5,502,315

 

Cash and cash equivalents at the beginning of the period

 

10,744,082

 

4,110,193

 

Cash and cash equivalents at the end of the period

 

$

18,438,567

 

$

9,612,508

 

Supplemental disclosure of cash flow information

 

 

 

 

 

Interest paid

 

$

3,025,253

 

$

1,489,461

 

Non-cash financing activities:

 

 

 

 

 

Accrual of offering costs

 

$

57,129

 

$

1,971,635

 

 

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

 

5



Table of Contents

 

New Mountain Finance Holdings, L.L.C.

 

Consolidated Schedule of Investments

 

September 30, 2011

(unaudited)

 

 

 

 

 

 

 

 

 

Principal

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Amount,

 

 

 

 

 

Percent of

 

Portfolio Company,

 

 

 

 

 

 

 

Par Value

 

 

 

Fair

 

Members’

 

Location and Industry

 

Type of Investment

 

Interest Rate

 

Maturity Date

 

or Shares

 

Cost

 

Value

 

Capital

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

United States

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stratus Technologies, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Information Technology

 

Ordinary shares (2)

 

 

 

144,270

 

$

65,123

 

$

44,838

 

 

 

 

 

Preferred shares (2)

 

 

 

32,830

 

14,819

 

10,203

 

 

 

 

 

 

 

 

 

 

 

 

 

79,942

 

55,041

 

0.01

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total shares

 

 

 

 

 

 

 

 

 

79,942

 

55,041

 

0.01

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

United States

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Alion Science and Technology Corporation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Federal Services

 

Warrants (2)

 

 

 

6,000

 

292,851

 

316,551

 

0.08

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Learning Care Group (US), Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Education

 

Warrants (2)

 

 

 

844

 

193,850

 

30,140

 

0.01

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total warrants

 

 

 

 

 

 

 

 

 

486,701

 

346,691

 

0.09

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

United States

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Decision Resources, LLC

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Business Services

 

First lien (3)

 

 7.00% (Base Rate + 5.50%)

 

12/28/2016

 

$

17,865,000

 

17,623,450

 

17,686,350

 

 

 

 

 

Second lien (2)

 

 9.50% (Base Rate + 8.00%)

 

5/7/2018

 

14,500,000

 

14,362,809

 

14,427,500

 

 

 

 

 

 

 

 

 

 

 

32,365,000

 

31,986,259

 

32,113,850

 

7.80

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Meritas Schools Holdings, LLC

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Education

 

First lien (3)

 

 7.50% (Base Rate + 6.00%)

 

7/29/2017

 

9,750,000

 

9,654,742

 

9,408,750

 

 

 

 

 

Second lien (2)

 

 11.50% (Base Rate + 10.00%)

 

1/29/2018

 

20,000,000

 

19,703,975

 

19,650,000

 

 

 

 

 

 

 

 

 

 

 

29,750,000

 

29,358,717

 

29,058,750

 

7.06

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Lawson Software, Inc. (fka SoftBrands, Inc.)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Software

 

First lien (3)

 

 6.75% (Base Rate + 5.25%)

 

7/5/2017

 

20,000,000

 

19,227,852

 

18,983,340

 

 

 

 

 

Subordinated (2)

 

 11.50%

 

7/15/2018

 

10,500,000

 

9,758,283

 

9,397,500

 

 

 

 

 

 

 

 

 

 

 

30,500,000

 

28,986,135

 

28,380,840

 

6.89

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Managed Health Care Associates, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Healthcare Services

 

First lien (2)

 

 3.49% (Base Rate + 3.25%)

 

8/1/2014

 

15,467,673

 

12,720,508

 

14,926,304

 

 

 

 

 

Second lien (2)

 

 6.74% (Base Rate + 6.50%)

 

2/1/2015

 

15,000,000

 

11,759,149

 

13,350,000

 

 

 

 

 

 

 

 

 

 

 

30,467,673

 

24,479,657

 

28,276,304

 

6.87

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Novell, Inc. (fka Attachmate Corporation, NetIQ Corporation)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Software

 

First lien (3)

 

 6.50% (Base Rate + 5.00%)

 

4/27/2017

 

12,000,000

 

11,911,515

 

11,591,256

 

 

 

 

 

Second lien (2)

 

 9.50% (Base Rate + 8.00%)

 

10/27/2017

 

15,000,000

 

14,859,699

 

14,400,000

 

 

 

 

 

 

 

 

 

 

 

27,000,000

 

26,771,214

 

25,991,256

 

6.31

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Insight Pharmaceuticals LLC

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Healthcare Products

 

Second lien (2)

 

 13.25% (Base Rate + 11.75%)

 

8/25/2017

 

25,000,000

 

24,008,514

 

24,000,000

 

5.83

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unitek Global Services, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Business Services

 

First lien (2)

 

 9.00% (Base Rate + 7.50%)

 

4/15/2018

 

19,900,000

 

19,340,601

 

19,825,375

 

4.81

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Healthworks Holding Company, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Healthcare Services

 

Second lien (2)

 

 10.50% (Base Rate + 9.00%)

 

6/15/2017

 

20,000,000

 

19,713,799

 

19,500,000

 

4.73

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Learning Care Group (US), Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Education

 

First lien (2)

 

 12.00%

 

4/27/2016

 

17,368,421

 

17,101,011

 

16,710,234

 

 

 

 

 

Subordinated (2)

 

 15.00%

 

6/30/2016

 

3,044,655

 

2,851,664

 

2,748,385

 

 

 

 

 

 

 

 

 

 

 

20,413,076

 

19,952,675

 

19,458,619

 

4.72

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ipreo Holdings LLC

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Information Services

 

First lien (3)

 

 8.00% (Base Rate + 6.50%)

 

8/5/2017

 

18,750,000

 

18,340,674

 

17,718,750

 

4.30

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

KeyPoint Government Solutions, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Federal Services

 

First lien (2)

 

 10.00% (Base Rate + 8.00%)

 

12/31/2015

 

17,865,000

 

17,550,644

 

17,329,050

 

4.21

%

 

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

 

6



Table of Contents

 

New Mountain Finance Holdings, L.L.C.

 

Consolidated Schedule of Investments (continued)

 

September 30, 2011

(unaudited)

 

 

 

 

 

 

 

 

 

Principal

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Amount,

 

 

 

 

 

Percent of

 

Portfolio Company,

 

 

 

 

 

 

 

Par Value

 

 

 

Fair

 

Members’

 

Location and Industry

 

Type of Investment

 

Interest Rate

 

Maturity Date

 

or Shares

 

Cost

 

Value

 

Capital

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Smile Brands Group Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Healthcare Services

 

First lien (3)

 

 7.00% (Base Rate + 5.25%)

 

12/21/2017

 

$

17,368,750

 

$

17,129,958

 

$

16,847,688

 

4.09

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sotera Defense Solutions, Inc. (Global Defense Technology & Systems, Inc.)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Federal Services

 

First lien (3)

 

 7.00% (Base Rate + 5.50%)

 

4/21/2017

 

16,957,500

 

16,799,558

 

16,703,138

 

4.05

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SonicWALL, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Software

 

First lien (3)

 

 8.25% (Base Rate + 6.25%)

 

1/23/2016

 

5,519,759

 

 

5,532,394

 

 

5,492,159

 

 

 

 

 

Second lien (2)

 

 12.00% (Base Rate + 10.00%)

 

1/23/2017

 

10,000,000

 

9,737,356

 

9,975,000

 

 

 

 

 

 

 

 

 

 

 

15,519,759

 

15,269,750

 

15,467,159

 

3.75

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Volume Services America, Inc. (Centerplate)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consumer Services

 

First lien (2)

 

 10.50% (Base Rate + 8.50%)

 

9/16/2016

 

14,850,000

 

14,497,289

 

14,757,262

 

3.58

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

MLM Holdings, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Software

 

First lien (3)

 

 7.00% (Base Rate + 5.25%)

 

12/1/2016

 

14,850,000

 

14,652,060

 

14,590,125

 

3.54

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pacific Architects and Engineers Incorporated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Federal Services

 

First lien (3)

 

 7.50% (Base Rate + 6.00%)

 

4/4/2017

 

15,000,000

 

14,719,535

 

14,475,000

 

3.51

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Virtual Radiologic Corporation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Healthcare Information Technology

 

First lien (3)

 

 7.75% (Base Rate + 4.50%)

 

12/22/2016

 

14,889,987

 

14,696,646

 

14,145,488

 

3.43

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LANDesk Group, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Software

 

First lien (3)

 

 7.00% (Base Rate + 5.25%)

 

3/28/2016

 

14,250,000

 

14,000,807

 

13,982,813

 

3.39

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SRA International, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Federal Services

 

First lien (3)

 

 6.50% (Base Rate + 5.25%)

 

7/20/2018

 

15,000,000

 

14,338,789

 

13,912,500

 

3.38

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Brock Holdings III, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Industrial Services

 

Second lien (2)

 

 10.00% (Base Rate + 8.25%)

 

3/16/2018

 

15,000,000

 

14,731,215

 

13,725,000

 

3.33

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fibertech Networks, LLC (fka Firefox Merger Sub, LLC)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Telecommunication

 

First lien (3)

 

 6.75% (Base Rate + 5.00%)

 

11/30/2016

 

11,910,000

 

11,751,903

 

11,731,350

 

2.85

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PODS Holding Funding Corp.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consumer Services

 

Subordinated (2)

 

 16.64%

 

12/23/2015

 

11,664,000

 

10,277,442

 

11,664,000

 

2.83

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mailsouth, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Media

 

First lien (3)

 

 6.75% (Base Rate + 4.99%)

 

12/14/2016

 

11,940,000

 

11,779,280

 

11,581,800

 

2.81

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Vision Solutions, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Software

 

Second lien (2)

 

 9.50% (Base Rate + 8.00%)

 

7/23/2017

 

12,000,000

 

11,889,250

 

11,580,000

 

2.81

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

TravelCLICK, Inc. (fka TravelCLICK Acquisition Co.)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Information Services

 

First lien (3)

 

 6.50% (Base Rate + 5.00%)

 

3/16/2016

 

11,430,031

 

11,225,450

 

11,087,130

 

2.69

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Merrill Communications LLC

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Business Services

 

First lien (2)

 

 7.50% (Base Rate + 5.50%)

 

12/22/2012

 

11,421,788

 

10,026,422

 

11,062,002

 

2.69

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CHG Companies, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Healthcare Services

 

Second lien (2)

 

 11.25% (Base Rate + 9.50%)

 

4/7/2017

 

10,000,000

 

9,820,654

 

9,975,000

 

2.42

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Porex Corporation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Specialty Chemicals and Materials

 

First lien (3)

 

 6.76% (Base Rate + 5.24%)

 

3/31/2015

 

10,000,000

 

9,860,319

 

9,850,000

 

2.39

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Immucor, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Healthcare Services

 

First lien (3)

 

 7.25% (Base Rate + 5.75%)

 

8/19/2018

 

5,000,000

 

4,803,215

 

4,943,750

 

 

 

 

 

Subordinated (2)

 

 11.13%

 

8/15/2019

 

5,000,000

 

4,936,289

 

4,887,500

 

 

 

 

 

 

 

 

 

 

 

10,000,000

 

9,739,504

 

9,831,250

 

2.39

%

 

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

 

7



Table of Contents

 

New Mountain Finance Holdings, L.L.C.

 

Consolidated Schedule of Investments (continued)

 

September 30, 2011

(unaudited)

 

 

 

 

 

 

 

 

 

Principal

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Amount,

 

 

 

 

 

Percent of

 

Portfolio Company,

 

 

 

 

 

 

 

Par Value

 

 

 

Fair

 

Members’

 

Location and Industry

 

Type of Investment

 

Interest Rate

 

Maturity Date

 

or Shares

 

Cost

 

Value

 

Capital

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Airvana Network Solutions Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Software

 

First lien (2)

 

 10.00% (Base Rate + 8.00%)

 

3/25/2015

 

$

9,676,190

 

$

9,506,763

 

$

9,760,857

 

2.37

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Vertafore, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Software

 

Second lien (2)

 

 9.75% (Base Rate + 8.25%)

 

10/29/2017

 

10,000,000

 

9,909,344

 

9,641,670

 

2.34

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Merge Healthcare Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Healthcare Services

 

First lien (2)

 

 11.75%

 

5/1/2015

 

9,000,000

 

8,870,249

 

9,180,000

 

2.23

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sunquest Information Systems, Inc. (Misys Hospital Systems, Inc.)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Healthcare Services

 

Second lien (2)

 

 9.75% (Base Rate + 8.50%)

 

6/16/2017

 

9,000,000

 

8,835,218

 

8,955,000

 

2.17

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mach Gen, LLC

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Power Generation

 

Second lien (2)

 

 7.83% (Base Rate + 7.50%)

 

2/22/2015

 

11,829,753

 

9,608,302

 

7,869,832

 

1.91

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Research Pharmaceutical Services, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Healthcare Services

 

First lien (3)

 

 6.75% (Base Rate + 5.24%)

 

2/18/2017

 

7,453,125

 

 

7,350,346

 

 

7,192,266

 

1.75

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Surgery Center Holdings, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Healthcare Services

 

First lien (3)

 

 6.50% (Base Rate + 5.00%)

 

2/6/2017

 

6,965,000

 

6,932,609

 

6,581,925

 

1.60

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stratus Technologies, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Information Technology

 

First lien (2)

 

 12.00%

 

3/29/2015

 

6,827,000

 

6,474,599

 

6,007,760

 

1.46

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Alion Science and Technology Corporation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Federal Services

 

First lien (2)

 

 12.00%

 

11/1/2014

 

6,133,884

 

5,526,935

 

5,377,372

 

1.31

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ozburn-Hessey Holding Company LLC

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Logistics

 

Second lien (2)

 

10.50% (Base Rate + 8.50%)

 

10/8/2016

 

6,000,000

 

5,887,996

 

5,280,000

 

1.28

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Datatel, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Software

 

Second lien (2)

 

8.75% (Base Rate + 7.25%)

 

2/19/2018

 

5,000,000

 

4,976,545

 

5,025,000

 

1.22

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Asurion, LLC (fka Asurion Corporation)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Business Services

 

Second lien (2)

 

9.00% (Base Rate + 7.50%)

 

5/24/2019

 

5,000,000

 

4,976,041

 

4,798,440

 

1.16

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Physiotherapy Associates, Inc. / Benchmark Medical, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Healthcare Facilities

 

First lien (2)

 

7.50% (Base Rate + 4.25%)

 

6/28/2013

 

3,792,954

 

3,232,454

 

3,755,024

 

0.91

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LVI Services Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Industrial Services

 

First lien (2)

 

9.25% (Base Rate + 7.50%)

 

3/31/2014

 

5,130,971

 

4,995,403

 

3,732,782

 

0.91

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Brickman Group Holdings, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Business Services

 

First lien (3)

 

7.25% (Base Rate + 5.50%)

 

10/14/2016

 

2,977,500

 

3,008,919

 

2,947,725

 

0.72

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ATI Acquisition Company (fka Ability Acquisition, Inc.)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Education

 

First lien (2)

 

 8.25% (Base Rate + 6.00%)

 

12/30/2014

 

4,432,500

 

4,306,438

 

1,440,563

 

0.35

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Education Management LLC

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Education

 

First lien (1), (2) - Undrawn

 

 

6/1/2012

 

3,000,000

 

(1,215,000

)

(291,810

)

(0.07)

%

 

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

 

8



Table of Contents

 

New Mountain Finance Holdings, L.L.C.

 

Consolidated Schedule of Investments (continued)

 

September 30, 2011

(unaudited)

 

 

 

 

 

 

 

 

 

Principal

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Amount,

 

 

 

 

 

Percent of

 

Portfolio Company,

 

 

 

 

 

 

 

Par Value

 

 

 

Fair

 

Members’

 

Location and Industry

 

Type of Investment

 

Interest Rate

 

Maturity Date

 

or Shares

 

Cost

 

Value

 

Capital