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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 June 30, 2012

 

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

 


 

Commission
File Number

 

Exact name of registrants as specified in their charters, addresses of principal executive
offices, telephone numbers and states or other jurisdictions of incorporation or organization

 

I.R.S. Employer
Identification Number

814-00839

 

New Mountain Finance Holdings, L.L.C.

787 Seventh Avenue, 48th Floor
New York, New York 10019
Telephone: (212) 720-0300
State of Incorporation: Delaware

 

26-3633318

814-00832

 

New Mountain Finance Corporation

787 Seventh Avenue, 48th Floor
New York, New York 10019
Telephone: (212) 720-0300
State of Incorporation: Delaware

 

27-2978010

814-00902

 

New Mountain Finance AIV Holdings Corporation

787 Seventh Avenue, 48th Floor
New York, New York 10019
Telephone: (212) 720-0300
State of Incorporation: Delaware

 

80-0721242

 


 

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.

 

New Mountain Finance Holdings, L.L.C.

 

Yes x No o

 

 

New Mountain Finance Corporation

 

Yes x No o

 

 

New Mountain Finance AIV Holdings Corporation

 

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).

 

New Mountain Finance Holdings, L.L.C.

 

Yes o No o

 

 

New Mountain Finance Corporation

 

Yes o No o

 

 

New Mountain Finance AIV Holdings Corporation

 

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):

 

New Mountain Finance Holdings, L.L.C.

 

Large accelerated filer o

 

Accelerated filer o

 

 

Non-accelerated filer x

 

Smaller reporting company o

New Mountain Finance Corporation

 

Large accelerated filer o

 

Accelerated filer o

 

 

Non-accelerated filer x

 

Smaller reporting company o

New Mountain Finance AIV Holdings Corporation

 

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).

 

New Mountain Finance Holdings, L.L.C.

 

Yes o No x

 

 

New Mountain Finance Corporation

 

Yes o No x

 

 

New Mountain Finance AIV Holdings Corporation

 

Yes o No x

 

 

 

Registrants

 

Description

 

Shares / Units as of August 8, 2012

New Mountain Finance Holdings, L.L.C.

 

Common membership units

 

30,919,629

New Mountain Finance Corporation

 

Common stock, $0.01 par value

 

10,697,691

New Mountain Finance AIV Holdings Corporation

 

Common stock, $0.01 par value

 

100

 

This combined Form 10-Q is filed separately by three registrants: New Mountain Finance Holdings, L.L.C., New Mountain Finance Corporation and New Mountain Finance AIV Holdings Corporation (collectively, the “New Mountain Finance Registrant(s)” or the “Registrant(s)”). Information contained herein relating to any New Mountain Finance Registrant is filed by such registrant solely on its own behalf. Each New Mountain Finance Registrant makes no representation as to information relating exclusively to the other registrants.

 

 

 



Table of Contents

 

FORM 10-Q FOR THE QUARTER ENDED JUNE 30, 2012
TABLE OF CONTENTS

 

 

 

PAGE

 

 

 

PART I. FINANCIAL INFORMATION

2

 

 

 

Item 1.

Financial Statements

2

 

 

 

 

New Mountain Finance Holdings, L.L.C.

 

 

Consolidated Statements of Assets, Liabilities and Members’ Capital as of June 30, 2012 (unaudited) and December 31, 2011

2

 

Consolidated Statements of Operations for the three months and six months ended June 30, 2012 (unaudited) and June 30, 2011 (unaudited)

3

 

Consolidated Statements of Changes in Members’ Capital for the six months ended June 30, 2012 (unaudited) and June 30, 2011 (unaudited)

4

 

Consolidated Statements of Cash Flows for the six months ended June 30, 2012 (unaudited) and June 30, 2011 (unaudited)

5

 

Consolidated Schedule of Investments as of June 30, 2012 (unaudited)

6

 

Consolidated Schedule of Investments as of December 31, 2011

12

 

New Mountain Finance Corporation

 

 

Statement of Assets and Liabilities as of June 30, 2012 (unaudited) and December 31, 2011

18

 

Statements of Operations for the three months and six months ended June 30, 2012 (unaudited) and from May 19, 2011 (commencement of operations) to June 30, 2011 (unaudited)

19

 

Statement of Changes in Net Assets for the six months ended June 30, 2012 (unaudited) and from May 19, 2011 (commencement of operations) to June 30, 2011 (unaudited)

20

 

Statement of Cash Flows for the six months ended June 30, 2012 (unaudited) and from May 19, 2011 (commencement of operations) to June 30, 2011 (unaudited)

21

 

New Mountain Finance AIV Holdings Corporation

 

 

Statement of Assets and Liabilities as of June 30, 2012 (unaudited) and December 31, 2011

22

 

Statements of Operations for the three months and six months ended June 30, 2012 (unaudited) and from May 19, 2011 (commencement of operations) to June 30, 2011 (unaudited)

23

 

Statement of Changes in Net Assets for the six months ended June 30, 2012 (unaudited) and from May 19, 2011 (commencement of operations) to June 30, 2011 (unaudited)

24

 

Statement of Cash Flows for the six months ended June 30, 2012 (unaudited) and from May 19, 2011 (commencement of operations) to June 30, 2011 (unaudited)

25

 

 

 

 

Combined Notes to the Financial Statements for New Mountain Finance Holdings, L.L.C., New Mountain Finance Corporation and New Mountain Finance AIV Holdings Corporation

26

 

 

 

 

Report of Independent Registered Public Accounting Firm

49

 

 

 

Item 2.

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

50

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

67

Item 4.

Controls and Procedures

68

 

 

 

PART II. OTHER INFORMATION

69

 

 

 

Item 1.

Legal Proceedings

69

Item 1A.

Risk Factors

69

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

69

Item 3.

Defaults upon Senior Securities

69

Item 4.

Mine Safety Disclosures

69

Item 5.

Other Information

69

Item 6.

Exhibits

70

 

Signatures

74

 

1



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

 

 

 

June 30, 2012

 

December 31, 2011

 

 

 

(unaudited)

 

 

 

Assets

 

 

 

 

 

Investments at fair value (cost of $747,213,642 and $699,864,784, respectively)

 

$

751,078,894

 

$

703,513,560

 

Cash and cash equivalents

 

9,508,403

 

15,318,811

 

Interest receivable

 

7,045,804

 

7,307,092

 

Deferred credit facility costs (net of accumulated amortization of $1,367,025 and $855,955, respectively)

 

4,938,821

 

3,713,739

 

Deferred offering costs

 

187,359

 

 

Receivable from affiliate

 

118,853

 

369,017

 

Other assets

 

795,788

 

356,486

 

Total assets

 

$

773,673,922

 

$

730,578,705

 

Liabilities

 

 

 

 

 

SLF Credit Facility

 

173,112,281

 

165,928,000

 

Holdings Credit Facility

 

138,756,913

 

129,037,813

 

Payable for unsettled securities purchased

 

19,200,000

 

7,604,931

 

Dividends payable

 

6,875,459

 

 

Incentive fee payable

 

3,682,368

 

2,317,328

 

Management fee payable

 

2,605,561

 

2,200,354

 

Interest payable

 

571,386

 

1,747,095

 

Other liabilities

 

1,135,145

 

1,241,366

 

Total liabilities

 

345,939,113

 

310,076,887

 

Members’ Capital

 

427,734,809

 

420,501,818

 

Total liabilities and members’ capital

 

$

773,673,922

 

$

730,578,705

 

Outstanding common membership units

 

30,919,629

 

30,919,629

 

Capital per unit

 

$

13.83

 

$

13.60

 

 

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

 

Six months ended

 

 

 

June 30, 2012

 

June 30, 2011

 

June 30, 2012

 

June 30, 2011

 

Investment income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

$

20,124,043

 

$

12,810,147

 

$

38,725,226

 

$

23,978,194

 

Other income

 

174,980

 

306,144

 

595,798

 

349,817

 

Total investment income

 

20,299,023

 

13,116,291

 

39,321,024

 

24,328,011

 

 

 

 

 

 

 

 

 

 

 

Expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Incentive fee

 

2,771,189

 

504,393

 

6,132,652

 

504,393

 

Management fee

 

2,605,561

 

773,509

 

5,119,857

 

807,509

 

Interest and other credit facility expenses

 

2,401,028

 

1,534,147

 

4,884,317

 

3,080,900

 

Professional fees (net of reimbursable expenses of $118,853, $130,186, $364,862 and $130,186, respectively)

 

307,535

 

516,678

 

509,373

 

569,834

 

Administrative expenses (net of reimbursable expenses of $279,048, $180,255, $582,843 and $180,255, respectively)

 

224,875

 

62,610

 

476,744

 

203,418

 

Other general and administrative expenses

 

342,590

 

170,712

 

638,883

 

178,568

 

Total expenses

 

8,652,778

 

3,562,049

 

17,761,826

 

5,344,622

 

Net investment income

 

11,646,245

 

9,554,242

 

21,559,198

 

18,983,389

 

 

 

 

 

 

 

 

 

 

 

Net realized gains on investments

 

11,968,454

 

6,659,833

 

12,975,787

 

12,552,163

 

Net change in unrealized (depreciation) appreciation of investments

 

(12,529,939

)

(7,559,450

)

216,476

 

(6,462,113

)

Net increase in capital resulting from operations

 

$

11,084,760

 

$

8,654,625

 

$

34,751,461

 

$

25,073,439

 

 

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)

 

 

 

Six months ended

 

 

 

June 30, 2012

 

June 30, 2011

 

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

 

 

 

 

 

Net investment income

 

$

21,559,198

 

$

18,983,389

 

Net realized gains on investments

 

12,975,787

 

12,552,163

 

Net change in unrealized appreciation (depreciation) of investments

 

216,476

 

(6,462,113

)

Net increase in members’ capital resulting from operations

 

34,751,461

 

25,073,439

 

Distributions

 

 

(10,249,155

)

Contributions

 

 

195,294,674

 

Dividends declared

 

(27,518,470

)

 

Offering costs

 

 

(11,440,923

)

Net increase in members’ capital

 

7,232,991

 

198,678,035

 

Members’ capital at beginning of period

 

420,501,818

 

241,927,261

 

Members’ capital at end of period

 

$

427,734,809

 

$

440,605,296

 

 

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)

 

 

 

Six months ended

 

 

 

June 30, 2012

 

June 30, 2011

 

Cash flows from operating activities

 

 

 

 

 

Net increase in capital resulting from operations

 

$

34,751,461

 

$

25,073,439

 

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

 

 

 

 

 

Net realized gains on investments

 

(12,975,787

)

(12,552,163

)

Net change in unrealized (appreciation) depreciation of investments

 

(216,476

)

6,462,113

 

Amortization of purchase discount

 

(3,006,326

)

(3,401,906

)

Amortization of deferred credit facility costs

 

511,070

 

311,283

 

Non-cash interest income

 

(715,298

)

(727,135

)

(Increase) decrease in operating assets:

 

 

 

 

 

Purchase of investments

 

(233,117,132

)

(245,993,220

)

Proceeds from sales and paydowns of investments

 

203,830,686

 

152,208,584

 

Cash received for purchase of undrawn portion of revolving credit facility

 

 

1,260,000

 

Cash paid for drawn revolvers

 

(7,665,000

)

(535,593

)

Cash repayments on drawn revolvers

 

6,300,000

 

 

Interest receivable

 

261,288

 

(1,038,712

)

Receivable from affiliate

 

250,164

 

 

Other assets

 

(439,302

)

(754,525

)

Increase (decrease) in operating liabilities:

 

 

 

 

 

Payable for unsettled securities purchased

 

11,595,069

 

(71,576,780

)

Incentive fee payable

 

1,365,040

 

504,393

 

Management fee payable

 

405,207

 

807,509

 

Interest payable

 

(1,175,709

)

279,149

 

Payable to affiliates

 

 

(202,180

)

Other liabilities

 

(61,335

)

(326,040

)

Net cash flows (used in) provided by operating activities

 

(102,380

)

(150,201,784

)

Cash flows from financing activities

 

 

 

 

 

Contributions

 

 

195,294,674

 

Distributions

 

 

(10,249,155

)

Dividends paid

 

(20,643,011

)

 

Offering costs paid

 

(101,299

)

(8,344,393

)

Proceeds from Holdings Credit Facility

 

177,618,025

 

63,281,605

 

Repayment of Holdings Credit Facility

 

(167,898,925

)

(88,678,542

)

Proceeds from SLF Credit Facility

 

46,943,332

 

92,043,800

 

Repayment of SLF Credit Facility

 

(39,759,051

)

(22,062,352

)

Deferred credit facility costs paid

 

(1,867,099

)

(3,977,249

)

Net cash flows (used in) provided by financing activities

 

(5,708,028

)

217,308,388

 

Net (decrease) increase in cash and cash equivalents

 

(5,810,408

)

67,106,604

 

Cash and cash equivalents at the beginning of the period

 

15,318,811

 

10,744,082

 

Cash and cash equivalents at the end of the period

 

$

9,508,403

 

$

77,850,686

 

Supplemental disclosure of cash flow information

 

 

 

 

 

Interest paid

 

$

5,323,912

 

$

1,962,278

 

Non-cash financing activities:

 

 

 

 

 

Dividends declared and payable

 

$

6,875,459

 

$

 

Accrual for offering costs

 

86,060

 

3,096,530

 

Accrual for deferred credit facility costs

 

61,153

 

 

 

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

 

June 30, 2012

(unaudited)

 

Portfolio Company, Location and
Industry

 

Type of
Investment

 

Interest Rate

 

Maturity
Date

 

Principal
Amount,
Par Value
or Shares

 

Cost

 

Fair
Value

 

Percent of
Members’
Capital

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Funded Debt InvestmentsUnited Kingdom

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Magic Newco, LLC**

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Software

 

First lien (3)

 

7.25% (Base Rate + 6.00%)

 

12/12/2018

 

$

15,000,000

 

$

14,552,352

 

$

14,722,500

 

3.44

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Funded Debt InvestmentsUnited Kingdom

 

 

 

 

 

 

 

$

15,000,000

 

$

14,552,352

 

$

14,722,500

 

3.44

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Funded Debt InvestmentsUnited States

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Plato, Inc. (Archipelago Learning, Inc.)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Education

 

First lien (3)

 

7.50% (Base Rate + 6.00%)

 

5/17/2018

 

$

12,000,000

 

$

11,646,435

 

$

11,962,500

 

 

 

 

 

Second lien (2)

 

11.25% (Base Rate + 9.75%)

 

5/17/2019

 

25,000,000

 

24,505,115

 

24,703,125

 

 

 

 

 

 

 

 

 

 

 

37,000,000

 

36,151,550

 

36,665,625

 

8.57

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Meritas Schools Holdings, LLC

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Education

 

First lien (3)

 

7.50% (Base Rate + 6.00%)

 

7/29/2017

 

9,000,000

 

8,920,755

 

8,977,500

 

 

 

 

 

Second lien (2)

 

11.50% (Base Rate + 10.00%)

 

1/29/2018

 

20,000,000

 

19,729,250

 

20,050,000

 

 

 

 

 

 

 

 

 

 

 

29,000,000

 

28,650,005

 

29,027,500

 

6.79

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Global Knowledge Training LLC

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Education

 

First lien (3)

 

6.50% (Base Rate + 4.99%)

 

4/21/2017

 

4,837,224

 

4,772,210

 

4,764,666

 

 

 

 

 

Second lien (2)

 

11.50% (Base Rate + 9.75%)

 

10/21/2018

 

24,250,000

 

23,788,152

 

23,755,300

 

 

 

 

 

 

 

 

 

 

 

29,087,224

 

28,560,362

 

28,519,966

 

6.67

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Managed Health Care Associates, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Healthcare Services

 

First lien (2)

 

3.50% (Base Rate + 3.25%)

 

8/1/2014

 

14,755,543

 

12,784,371

 

14,275,988

 

 

 

 

 

Second lien (2)

 

6.75% (Base Rate + 6.50%)

 

2/1/2015

 

15,000,000

 

12,354,185

 

13,950,000

 

 

 

 

 

 

 

 

 

 

 

29,755,543

 

25,138,556

 

28,225,988

 

6.60

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Software

 

First lien (3)

 

7.25% (Base Rate + 5.75%)

 

11/22/2017

 

8,000,000

 

7,842,359

 

7,916,000

 

 

 

 

 

Second lien (2)

 

11.00% (Base Rate + 9.50%)

 

11/22/2018

 

20,000,000

 

19,406,247

 

19,587,500

 

 

 

 

 

 

 

 

 

 

 

28,000,000

 

27,248,606

 

27,503,500

 

6.43

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Insight Pharmaceuticals LLC

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Healthcare Products

 

Second lien (2)

 

13.25% (Base Rate + 11.75%)

 

8/25/2017

 

25,000,000

 

24,095,068

 

24,625,000

 

5.76

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unitek Global Services, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Business Services

 

First lien (2)

 

9.00% (Base Rate + 7.50%)

 

4/15/2018

 

19,800,000

 

19,306,272

 

19,354,500

 

 

 

 

 

First lien (2)

 

9.00% (Base Rate + 7.50%)

 

4/15/2018

 

5,000,000

 

4,803,707

 

4,887,500

 

 

 

 

 

 

 

 

 

 

 

24,800,000

 

24,109,979

 

24,242,000

 

5.67

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Renaissance Learning, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Education

 

Second lien (2)

 

12.00% (Base Rate + 10.50%)

 

10/19/2018

 

20,000,000

 

19,063,864

 

20,100,000

 

4.70

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Learning Care Group (US), Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Education

 

First lien (2)

 

12.00%

 

4/27/2016

 

17,368,421

 

17,144,523

 

16,695,606

 

 

 

 

 

Subordinated (2)

 

15.00% PIK*

 

6/30/2016

 

3,518,479

 

3,354,963

 

3,194,889

 

 

 

 

 

 

 

 

 

 

 

20,886,900

 

20,499,486

 

19,890,495

 

4.65

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Healthworks Holding Company, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Healthcare Services

 

Second lien (2)

 

10.50% (Base Rate + 9.00%)

 

6/15/2017

 

20,000,000

 

19,738,856

 

19,700,000

 

4.60

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Transplace Texas, L.P.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Logistics

 

Second lien (2)

 

11.00% (Base Rate + 9.00%)

 

4/12/2017

 

20,000,000

 

19,549,196

 

19,500,000

 

4.56

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

eResearchTechnology, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Healthcare Services

 

First lien (2)

 

8.00% (Base Rate + 6.50%)

 

5/2/2018

 

20,000,000

 

19,200,000

 

19,200,000

 

4.49

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ipreo Holdings LLC

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Information Services

 

First lien (3)

 

8.00% (Base Rate + 6.50%)

 

8/5/2017

 

18,609,375

 

18,244,485

 

18,562,852

 

4.34

%

 

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)

 

June 30, 2012

(unaudited)

 

Portfolio Company, Location and
Industry

 

Type of
Investment

 

Interest Rate

 

Maturity
Date

 

Principal
Amount,
Par Value
or Shares

 

Cost

 

Fair
Value

 

Percent of
Members’
Capital

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NEWAsurion Corporation (6)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Business Services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Asurion, LLC (fka Asurion Corporation)

 

Second lien (2)

 

9.00% (Base Rate + 7.50%)

 

5/24/2019

 

$

5,000,000

 

$

4,978,378

 

$

5,128,125

 

 

 

Lonestar Intermediate Super Holdings, LLC

 

Subordinated (2)

 

11.00% (Base Rate + 9.50%)

 

9/2/2019

 

12,000,000

 

11,649,756

 

12,342,000

 

 

 

 

 

 

 

 

 

 

 

17,000,000

 

16,628,134

 

17,470,125

 

4.08

%

Rocket Software, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Software

 

Second lien (2)

 

10.25% (Base Rate + 8.75%)

 

2/8/2019

 

17,500,000

 

17,283,942

 

17,412,500

 

4.07

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PODS, Inc. (7)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consumer Services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PODS Funding Corp. II

 

First lien (3)

 

8.50% (Base Rate + 7.00%)

 

11/29/2016

 

12,734,077

 

12,386,167

 

12,670,407

 

 

 

Storapod Holding Company, Inc.

 

Subordinated (2)

 

21.00% PIK*

 

11/29/2017

 

4,500,000

 

4,352,251

 

4,344,095

 

 

 

 

 

 

 

 

 

 

 

17,234,077

 

16,738,418

 

17,014,502

 

3.98

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Federal Services

 

First lien (3)

 

7.00% (Base Rate + 5.50%)

 

4/21/2017

 

16,830,035

 

16,694,323

 

16,661,734

 

3.89

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

KeyPoint Government Solutions, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Federal Services

 

First lien (2)

 

10.00% (Base Rate + 8.00%)

 

12/31/2015

 

16,406,308

 

16,161,010

 

16,488,340

 

3.85

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OpenLink International, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Software

 

First lien (3)

 

7.75% (Base Rate + 6.25%)

 

10/30/2017

 

14,925,000

 

14,652,855

 

14,980,969

 

3.50

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Brock Holdings III, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Industrial Services

 

Second lien (2)

 

10.00% (Base Rate + 8.25%)

 

3/16/2018

 

15,000,000

 

14,754,147

 

14,850,000

 

3.47

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Volume Services America, Inc. (Centerplate)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consumer Services

 

First lien (2)

 

10.50% (Base Rate + 8.50%)

 

9/16/2016

 

14,775,000

 

14,469,492

 

14,821,172

 

3.46

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Landslide Holdings, Inc. (Crimson Acquisition Corp.)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Software

 

First lien (2)

 

7.00% (Base Rate + 5.75%)

 

6/19/2018

 

15,000,000

 

14,700,654

 

14,700,000

 

3.44

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SRA International, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Federal Services

 

First lien (3)

 

6.50% (Base Rate + 5.25%)

 

7/20/2018

 

15,163,953

 

14,505,783

 

14,699,557

 

3.44

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Triple Point Technology, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Software

 

First lien (3)

 

8.00% (Base Rate + 6.50%)

 

10/27/2017

 

14,427,500

 

13,899,706

 

14,535,706

 

3.40

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pacific Architects and Engineers Incorporated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Federal Services

 

First lien (3)

 

7.50% (Base Rate + 6.00%)

 

4/4/2017

 

14,100,000

 

13,871,885

 

14,100,000

 

3.30

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Virtual Radiologic Corporation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Healthcare Information Technology

 

First lien (3)

 

7.75% (Base Rate + 4.50%)

 

12/22/2016

 

14,814,975

 

14,645,542

 

13,222,365

 

3.09

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Aspen Dental Management, Inc

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Healthcare Services

 

First lien (3)

 

7.00% (Base Rate + 5.50%)

 

10/6/2016

 

12,935,000

 

12,690,433

 

12,886,494

 

3.01

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Smile Brands Group Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Healthcare Services

 

First lien (3)

 

7.00% (Base Rate + 5.25%)

 

12/21/2017

 

12,275,283

 

12,123,296

 

12,290,627

 

2.87

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Vision Solutions, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Software

 

Second lien (2)

 

9.50% (Base Rate + 8.00%)

 

7/23/2017

 

12,000,000

 

11,903,462

 

11,940,000

 

2.79

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Permian Tank & Manufacturing, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Energy

 

First lien (3)

 

9.00% (Base Rate + 7.25%)

 

3/15/2017

 

11,828,829

 

11,546,638

 

11,533,108

 

2.70

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

TravelCLICK, Inc. (fka TravelCLICK Acquisition Co.)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Information Services

 

First lien (3)

 

6.50% (Base Rate + 5.00%)

 

3/16/2016

 

11,343,875

 

11,174,700

 

11,358,055

 

2.65

%

 

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)

 

June 30, 2012

(unaudited)

 

Portfolio Company, Location and
Industry

 

Type of
Investment

 

Interest Rate

 

Maturity
Date

 

Principal
Amount,
Par Value
or Shares

 

Cost

 

Fair
Value

 

Percent of
Members’
Capital

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mailsouth, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Media

 

First lien (3)

 

6.75% (Base Rate + 4.99%)

 

12/14/2016

 

$

11,192,992

 

$

11,060,805

 

$

11,025,097

 

2.58

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Merrill Communications LLC

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Business Services

 

First lien (2)

 

7.75% (Base Rate + 4.50%)

 

12/24/2012

 

11,421,788

 

10,834,927

 

10,765,035

 

2.52

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Immucor, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Healthcare Services

 

First lien (3)

 

7.25% (Base Rate + 5.75%)

 

8/19/2018

 

4,962,500

 

4,782,927

 

5,002,820

 

 

 

 

 

Subordinated (2)

 

11.13%

 

8/15/2019

 

5,000,000

 

4,940,257

 

5,500,000

 

 

 

 

 

 

 

 

 

 

 

9,962,500

 

9,723,184

 

10,502,820

 

2.46

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CHG Companies, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Healthcare Services

 

Second lien (2)

 

11.25% (Base Rate + 9.50%)

 

4/7/2017

 

10,000,000

 

9,838,824

 

10,050,000

 

2.35

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

YP Intermediate Holdings Corp. / YP Intermediate Holdings II LLC

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Media

 

Second lien (1)(2)

 

15.00% (12.00% + 3.00% PIK)*

 

5/18/2017

 

10,329,897

 

10,026,652

 

10,020,000

 

2.34

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Vertafore, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Software

 

Second lien (2)

 

9.75% (Base Rate + 8.25%)

 

10/29/2017

 

10,000,000

 

9,917,822

 

9,950,000

 

2.33

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Premier Dental Services, Inc. (Western)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Healthcare Services

 

First lien (2)

 

5.97% (Base Rate + 5.50%)

 

7/1/2013

 

9,961,832

 

9,420,645

 

9,463,740

 

2.21

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Merge Healthcare Inc.**

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Healthcare Services

 

First lien (2)

 

11.75%

 

5/1/2015

 

9,000,000

 

8,897,244

 

9,337,500

 

2.18

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

8,851,864

 

9,270,000

 

2.17

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Tekelec Global, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Software

 

First lien (3)

 

9.00% (Base Rate + 7.50%)

 

1/29/2018

 

7,820,000

 

7,709,062

 

7,702,700

 

1.80

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Physio-Control International, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Healthcare Products

 

First lien (2)(8)

 

9.88%

 

1/15/2019

 

7,000,000

 

7,000,000

 

7,490,000

 

1.75

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Surgery Center Holdings, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Healthcare Services

 

First lien (3)

 

6.50% (Base Rate + 5.00%)

 

2/6/2017

 

6,868,750

 

6,841,269

 

6,834,406

 

1.60

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Research Pharmaceutical Services, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Healthcare Services

 

First lien (3)

 

7.00% (Base Rate + 5.50%)

 

2/18/2017

 

7,312,500

 

7,223,525

 

6,581,250

 

1.54

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Alion Science and Technology Corporation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Federal Services

 

First lien (2)

 

10.00% + 2.00% PIK*

 

11/1/2014

 

6,257,192

 

6,017,932

 

5,876,549

 

1.37

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stratus Technologies, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Information Technology

 

First lien (2)

 

12.00%

 

3/29/2015

 

6,664,000

 

6,364,947

 

5,831,000

 

1.36

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ozburn-Hessey Holding Company LLC

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Logistics

 

Second lien (2)

 

11.50% (Base Rate + 9.50%)

 

10/10/2016

 

6,000,000

 

5,902,813

 

5,220,000

 

1.22

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LVI Services Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Industrial Services

 

First lien (2)

 

9.75% (Base Rate + 6.50%)

 

3/31/2014

 

5,063,248

 

4,547,127

 

4,354,394

 

1.02

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Education Management LLC**

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Education

 

First lien (3)

 

8.25% (Base Rate + 7.00%)

 

3/30/2018

 

3,989,171

 

3,873,125

 

3,890,690

 

0.91

%

 

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)

 

June 30, 2012

(unaudited)

 

Portfolio Company, Location and
Industry

 

Type of
Investment

 

Interest Rate

 

Maturity
Date

 

Principal
Amount,
Par Value
or Shares

 

Cost

 

Fair
Value

 

Percent of
Members’
Capital

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mach Gen, LLC

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Power Generation

 

Second lien (2)

 

7.97% PIK (Base Rate + 7.50%)*

 

2/22/2015

 

$

5,391,921

 

$

4,670,806

 

$

3,696,603

 

0.86

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Brickman Group Holdings, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Business Services

 

Subordinated (2)(8)

 

9.13%

 

11/1/2018

 

3,650,000

 

3,323,358

 

3,577,000

 

0.84

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Airvana Network Solutions Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Software

 

First lien (2)

 

10.00% (Base Rate + 8.00%)

 

3/25/2015

 

3,428,571

 

3,381,359

 

3,325,714

 

0.78

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ATI Acquisition Company (fka Ability Acquisition, Inc.)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Education

 

First lien (2)

 

12.25% (Base Rate + 5.00% + 4.00% PIK) (5)*

 

12/30/2014

 

4,432,500

 

4,306,437

 

332,438

 

 

 

 

 

First lien (2)

 

17.25% (Base Rate + 10.00% + 4.00% PIK)*

 

6/30/2012— Past Due

 

102,861

 

93,691

 

82,289

 

 

 

 

 

First lien (2)

 

17.25% (Base Rate + 10.00% + 4.00% PIK)*

 

6/30/2012— Past Due

 

1,665,103

 

1,516,666

 

1,332,082

 

 

 

 

 

 

 

 

 

 

 

6,200,464

 

5,916,794

 

1,746,809

 

0.41

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Advantage Sales & Marketing Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Business Services

 

First lien (2)(4)

 

6.25% (Base Rate + 3.00%)

 

12/17/2015

 

1,365,000

 

1,365,000

 

1,262,625

 

0.30

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Funded Debt InvestmentsUnited States

 

 

 

 

 

 

 

$

753,578,703

 

$

731,403,517