What changed in this filing

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Item 2. Management’s Discussion and Analysis

2021-05-05 compared with 2020-11-04 · 574 added, 423 removed, 936 unchanged (52% of the section changed)

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• statements concerning the impact of a protracted decline in the liquidity of credit markets;

• the general economy, including the impact of interest and inflation rates, and the COVID-19 pandemic on the industries in which we invest;

• 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 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;

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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 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.

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.

We are a Delaware corporation that was originally incorporated on June 29, 2010 and completed our initial public offering ("IPO") on May 19, 2011.

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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 September 30, 2020, we raised approximately $893.2 million in net proceeds from additional offerings of our common stock.

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.

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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 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.

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.

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("NMF Ancora"), NMF QID Holdings, Inc.

("NMF QID") and NMF YP Holdings Inc.

("NMF YP"), 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 U.S.

federal income tax purposes and may incur income tax expense as a result of their ownership of the portfolio companies;

("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;

• New Mountain Finance Servicing, L.L.C.

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Our portfolio may be concentrated in a limited number of industries.

As of September 30, 2020, 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 September 30, 2020, our net asset value was approximately $1,184.8 million and our portfolio had a fair value of approximately $2,896.6 million in 105 portfolio companies, with a weighted average yield to maturity at cost for income producing investments ("YTM at Cost") of approximately 8.6% and a weighted average yield to maturity at cost for all investments ("YTM at Cost for Investments") of approximately 7.8%.

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.

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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

On October 28, 2020, our board of directors declared a fourth quarter 2020 distribution of $0.30 per share payable on December 30, 2020 to holders of record as of December 16, 2020.

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

On March 11, 2020, the World Health Organization declared COVID-19 a global pandemic and recommended containment and mitigation measures worldwide.

The COVID-19 pandemic has had, and continues to have, a significant impact on the U.S.

The extent of the continued 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 virus, related advisories and restrictions, and the health of the financial markets and economy as a result of COVID-19, all of which are highly uncertain and cannot be predicted.

To the extent our portfolio companies continue to be adversely impacted by the effects of the COVID-19 pandemic, such impact may have a material adverse impact on our future net investment income, the fair value of our portfolio investments, our financial condition and results of operations and the financial condition of our portfolio companies.

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 as of September 30, 2020, as compared to our net asset value as of December 31, 2019.

As of September 30, 2020, 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 September 30, 2020.

However, any continued increase in unrealized depreciation of our investment portfolio or further significant reductions in our net asset value, as a result of the effects of the COVID-19 pandemic or otherwise, increases the risk of breaching the relevant covenants.

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”.

We will continue to monitor the rapidly evolving situation surrounding the COVID-19 pandemic and guidance from U.S.

and international authorities, including federal, state and local public health authorities, and may take additional actions based on their recommendations.

In these circumstances, there may be developments outside our control requiring us to adjust our plan of operation.

For example, recurring COVID-19 outbreaks have led to the re-introduction or continuation of certain public health restrictions (such as instituting quarantines, prohibitions on travel and the closure of offices, business, schools, retail stores and other public venues) in certain states in the United States and globally and could continue to lead to the re-introduction of such restrictions elsewhere.

As such, given the dynamic nature of this situation, we cannot reasonably estimate the impact of COVID-19 on our financial condition, results of operations or cash flows in the future.

Critical Accounting Policies

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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 and NMF YP and our majority-owned consolidated subsidiary, NMNLC.

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").

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(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.

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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.

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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 September 30, 2020:

The following table summarizes the levels in the fair value hierarchy that our portfolio investments fall into as of March 31, 2021:

(in thousands) Total Level I Level II Level III

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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:

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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 September 30, 2020, we used the relevant EBITDA multiple ranges set forth in the table below to determine the enterprise value of our portfolio companies.

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.

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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 September 30, 2020, 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 September 30, 2020 were as follows:

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

Type Fair Value as of September 30, 2020 Approach Unobservable Input Low High Weighted

Type Fair Value as of March 31, 2021 Approach Unobservable Input Low High Weighted

First lien $ 1,356,548 Market & income approach EBITDA multiple 5.0x 35.0x 14.8x

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Discount rate 5.8 % 35.2 % 11.2 %

700 Black Scholes analysis Expected life in years 5.5 5.5 5.5

Volatility 52.3 % 52.3 % 52.3 %

Discount rate 0.7 % 0.7 % 0.7 %

158 Other N/A(1) N/A N/A N/A

(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

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SLP I is a portfolio company held by us.

SLP I is structured as a private investment fund, in which all of the investors are "qualified purchasers", as such term is defined in section 2(a)(51) of the 1940 Act.

Transfer of interests in SLP I is subject to restrictions and, as a result, such interests are not readily marketable.

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's re-investment period ended on August 31, 2020.

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 is capitalized with $93.0 million of capital commitments and debt from a revolving credit facility and is managed by us.

Our capital commitment is $23.0 million, representing less than 25.0% ownership, with third party investors representing the remaining capital commitments.

As of September 30, 2020, SLP I had total investments with an aggregate fair value of approximately $292.9 million, debt outstanding of $220.1 million and capital that had been called and funded of $93.0 million.

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 September 30, 2020 and December 31, 2019.

We, as an investment adviser registered under the Advisers Act, act as the collateral manager to SLP I and are entitled to receive a management fee for our investment management services provided to SLP I.

As a result, SLP I is classified as our affiliate.

No management fee is charged on our investment in SLP I in connection with the administrative services provided to SLP I.

For the three and nine months ended September 30, 2020, we earned approximately $0.3 million and $0.8 million, respectively, in management fees related to SLP I, which is included in other income.

For the three and nine months ended September 30, 2019, we earned approximately $0.3 million and $0.9 million, respectively, in management fees related to SLP I, which is included in other income.

As of September 30, 2020 and December 31, 2019, approximately $0.5 million and $0.3 million, respectively, of management fees related to SLP I was included in receivable from affiliates.

For the three and nine months ended September 30, 2020, we earned approximately $0.7 million and $2.1 million, respectively, of dividend income related to SLP I, which is included in dividend income.

For the three and nine months ended September 30, 2019, we earned approximately $0.8 million and $2.3 million, respectively, of dividend income related to SLP I, which is included in dividend income.

As of September 30, 2020 and December 31, 2019, approximately $0.8 million and $0.7 million, respectively, of dividend income related to SLP I was included in interest and dividend receivable.

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, 2021 December 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 I 34 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 Investment Industry Interest Rate (1) Maturity Date Principal Amount or Par Value Cost Fair

Funded Investments - First lien (in thousands) (in thousands) (in thousands)

Access CIG, LLC Business 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%) 7/31/2026 6,849 6,794 6,852

Affordable Care Holding Corp.

Healthcare Services 5.75% (L + 4.75%) 10/24/2022 6,596 6,565 6,497

ASG Technologies Group, Inc.

Software 4.50% (L + 3.50%) 7/31/2024 651 649 643

Education 5.00% (L + 4.00%) 12/1/2023 5,980 5,965 5,920

Bearcat Buyer, Inc.

Healthcare Services 5.25% (L + 4.25%) 7/9/2026 130 130 130

Bearcat Buyer, Inc.

Healthcare Services 5.25% (L + 4.25%) 7/9/2026 629 627 629

Bracket Intermediate Holding Corp.

Healthcare Services 4.49% (L + 4.25%) 9/5/2025 4,508 4,493 4,502

Certara Holdco, Inc.

Healthcare Information Technology 3.70% (L + 3.50%) 8/15/2024 5,125 5,121 5,125

CHA Holdings, Inc.

Business Services 5.50% (L + 4.50%) 4/10/2025 451 451 421

Software 3.90% (L + 3.75%) 11/29/2024 6,727 6,716 6,574

Dealer Tire, LLC Distribution & Logistics 4.36% (L + 4.25%) 12/12/2025 3,424 3,417 3,434

Drilling Info Holdings, Inc.

Business Services 4.36% (L + 4.25%) 7/30/2025 6,088 6,070 5,996

Emerald 2 Limited Business Services 3.61% (L + 3.50%) 7/10/2026 447 447 445

eResearchTechnology, Inc.

Healthcare Services 5.50% (L + 4.50%) 2/4/2027 1,342 1,331 1,345

Fastlane Parent Company, Inc.

Distribution & Logistics 4.61% (L + 4.50%) 2/4/2026 1,359 1,339 1,359

Greenway Health, LLC Software 4.75% (L + 3.75%) 2/16/2024 6,675 6,660 6,383

Heartland Dental, LLC Healthcare Services 3.61% (L + 3.50%) 4/30/2025 3,600 3,589 3,549

Help/Systems Holdings, Inc.

Software 5.75% (L + 4.75%) 11/19/2026 137 137 138

LSCS Holdings, Inc.

Healthcare Services 4.51% (L + 4.25%) 3/17/2025 1,368 1,364 1,355

LSCS Holdings, Inc.

Healthcare Services 4.51% (L + 4.25%) 3/17/2025 5,301 5,285 5,248

Market Track, LLC Business Services 5.25% (L + 4.25%) 6/5/2024 779 781 779

Medical Solutions Holdings, Inc.

Healthcare Services 5.50% (L + 4.50%) 6/14/2024 2,243 2,240 2,247

Ministry Brands, LLC Software 5.00% (L + 4.00%) 12/2/2022 4,863 4,856 4,850

National Intergovernmental Purchasing Alliance Company Business Services 3.95% (L + 3.75%) 5/23/2025 1,349 1,350 1,346

Pelican Products, Inc.

Business Products 4.50% (L + 3.50%) 5/1/2025 2,248 2,244 2,227

Premise Health Holding Corp.

Healthcare Services 3.70% (L + 3.50%) 7/10/2025 627 624 624

Project Accelerate Parent, LLC Business Services 5.25% (L + 4.25%) 1/2/2025 4,164 4,149 4,015

PSC Industrial Holdings Corp.

Industrial Services 4.75% (L + 3.75%) 10/11/2024 3,896 3,875 3,815

Salient CRGT Inc.

Federal Services 7.50% (L + 6.50%) 2/28/2022 6,731 6,717 6,731

Sierra Enterprises, LLC Food & Beverage 5.00% (L + 4.00%) 11/11/2024 4,249 4,233 4,195

Wirepath LLC Distribution & Logistics 4.20% (L + 4.00%) 8/5/2024 6,762 6,762 6,661

WP CityMD Bidco LLC Healthcare Services 4.50% (L + 3.75%) 8/13/2026 6,133 6,083 6,132

Wrench Group LLC Consumer Services 4.20% (L + 4.00%) 4/30/2026 2,734 2,712 2,734

YI, LLC Healthcare Services 5.00% (L + 4.00%) 11/7/2024 7,778 7,771 7,564

Zelis Cost Management Buyer, Inc.

Healthcare Information Technology 3.62% (L + 3.50%) 9/30/2026 1,754 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 Investment Industry Interest Rate (1) Maturity Date Principal Amount or Par Value Cost Fair

Funded Investments - First lien (in thousands) (in thousands) (in thousands)

Access CIG, LLC Business 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%) 7/31/2026 6,866 6,809 6,836

Affordable Care Holding Corp.

Healthcare Services 5.75% (L + 4.75%) 10/24/2022 6,614 6,578 6,531

ASG Technologies Group, Inc.

Software 4.50% (L + 3.50%) 7/31/2024 653 651 636

Education 5.00% (L + 4.00%) 12/1/2023 5,980 5,964 5,980

Bearcat Buyer, Inc.

Healthcare Services 5.25% (L + 4.25%) 7/9/2026 131 130 131

Bearcat Buyer, Inc.

Healthcare Services 5.25% (L + 4.25%) 7/9/2026 631 628 631

Bracket Intermediate Holding Corp.

Healthcare Services 4.48% (L + 4.25%) 9/5/2025 4,520 4,504 4,474

Certara Holdco, Inc.

Healthcare Information Technology 3.75% (L + 3.50%) 8/15/2024 5,138 5,134 5,145

CHA Holdings, Inc.

Business Services 5.50% (L + 4.50%) 4/10/2025 452 452 423

Software 3.90% (L + 3.75%) 11/29/2024 6,745 6,732 6,479

Dealer Tire, LLC Distribution & Logistics 4.40% (L + 4.25%) 12/12/2025 3,433 3,426 3,419

Drilling Info Holdings, Inc.

Business Services 4.40% (L + 4.25%) 7/30/2025 6,103 6,084 5,925

Emerald 2 Limited Business Services 3.50% (L + 3.25%) 7/10/2026 449 448 445

eResearchTechnology, Inc.

Healthcare Services 5.50% (L + 4.50%) 2/4/2027 1,345 1,333 1,336

Fastlane Parent Company, Inc.

Distribution & Logistics 4.65% (L + 4.50%) 2/4/2026 1,363 1,342 1,355

Greenway Health, LLC Software 4.75% (L + 3.75%) 2/16/2024 6,693 6,677 6,141

Heartland Dental, LLC Healthcare Services 3.65% (L + 3.50%) 4/30/2025 3,609 3,597 3,524

HS Purchaser, LLC / Help/Systems Holdings, Inc.

Software 5.75% (L + 4.75%) 11/19/2026 138 137 138

LSCS Holdings, Inc.

Healthcare Services 4.51% (L + 4.25%) 3/17/2025 1,372 1,367 1,344

LSCS Holdings, Inc.

Healthcare Services 4.51% (L + 4.25%) 3/17/2025 5,314 5,297 5,208

Market Track, LLC Business Services 5.25% (L + 4.25%) 6/5/2024 781 783 767

Medical Solutions Holdings, Inc.

Healthcare Services 5.50% (L + 4.50%) 6/14/2024 2,249 2,245 2,237

Ministry Brands, LLC Software 5.00% (L + 4.00%) 12/2/2022 4,876 4,868 4,852

National Intergovernmental Purchasing Alliance Company Business Services 4.00% (L + 3.75%) 5/23/2025 1,352 1,354 1,346

Pelican Products, Inc.

Business Products 4.50% (L + 3.50%) 5/1/2025 2,254 2,250 2,217

Premise Health Holding Corp.

Healthcare Services 3.75% (L + 3.50%) 7/10/2025 628 626 614

Project Accelerate Parent, LLC Business Services 5.25% (L + 4.25%) 1/2/2025 4,175 4,159 3,799

PSC Industrial Holdings Corp.

Industrial Services 4.75% (L + 3.75%) 10/11/2024 3,906 3,883 3,799

Salient CRGT Inc.

Federal Services 7.50% (L + 6.50%) 2/28/2022 6,731 6,713 6,731

Sierra Enterprises, LLC Food & Beverage 5.00% (L + 4.00%) 11/11/2024 4,260 4,243 4,192

Wirepath LLC Distribution & Logistics 4.25% (L + 4.00%) 8/5/2024 6,779 6,779 6,542

WP CityMD Bidco LLC Healthcare Services 5.50% (L + 4.50%) 8/13/2026 6,148 6,096 6,162

Wrench Group LLC Consumer Services 4.25% (L + 4.00%) 4/30/2026 2,739 2,716 2,712

YI, LLC Healthcare Services 5.00% (L + 4.00%) 11/7/2024 7,797 7,792 7,174

Zelis Cost Management Buyer, Inc.

Healthcare Information Technology 4.90% (L + 4.75%) 9/30/2026 1,758 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.

Table o f Contents

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, 2021 December 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 assets 6,308 6,461

Total assets $ 132,169 $ 233,186

Credit facility $ 88,567 $ 188,867

Deferred financing costs (233) (296)

Distribution payable 1,075 2,538

Other liabilities 689 1,364

Total liabilities 90,098 192,473

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, 2021 March 31, 2020

(in thousands) (in thousands)

Interest income $ 1,966 $ 5,122

Other income 11 39

Total investment income 1,977 5,161

Interest and other financing expenses 471 1,954

Other expenses 539 398

Total expenses 1,010 2,352

expenses waived and reimbursed — (56)

Net expenses 1,010 2,296

Net investment income 967 2,865

Net realized gains on investments 1 45

Net change in unrealized appreciation (depreciation) of investments 1,465 (39,060)

Net increase (decrease) in members' capital $ 2,433 $ (36,150)

Table o f Contents

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

8 unchanged sentences

Any decision by SLP II to call down on capital commitments requires approval by the board of managers of SLP II.

As of September 30, 2020, 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 September 30, 2020 and December 31, 2019.

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 September 30, 2020 and December 31, 2019, SLP II had total investments with an aggregate fair value of approximately $286.4 million and $340.0 million, respectively, and debt outstanding under its credit facility of $204.5 million and $246.9 million, respectively.

As of September 30, 2020 and December 31, 2019, none of SLP II's investments were on non-accrual.

Additionally, as of September 30, 2020 and December 31, 2019, SLP II had unfunded commitments in the form of delayed draws of $0.2 million and $3.2 million, respectively.

Below is a summary of SLP II's portfolio, along with a listing of the individual investments in SLP II's portfolio as of September 30, 2020 and December 31, 2019:

(in thousands) September 30, 2020 December 31, 2019

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, 2021 December 31, 2020

First lien investments (1) $ 255,235 $ 279,678

5 unchanged sentences

(2) Computed as the all in interest rate in effect on accruing investments divided by the total principal amount of investments.

The following table is a listing of the individual investments in SLP II's portfolio as of September 30, 2020:

Table o f Contents

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 Investment Industry Interest Rate (1) Maturity Date Principal Amount or Par Value Cost Fair

11 unchanged sentences

Federal Services 4.20% (L + 4.00%) 10/30/2026 9,900 9,817 9,888

Bleriot US Bidco Inc.

Federal Services 4.97% (L + 4.75%) 10/30/2026 8,605 8,528 8,546

Brave Parent Holdings, Inc.

5 unchanged sentences

Business Services 5.50% (L + 4.50%) 4/10/2025 10,561 10,531 9,874

CommerceHub, Inc.

Software 3.65% (L + 3.50%) 5/21/2025 2,444 2,435 2,389

Dealer Tire, LLC Distribution & Logistics 4.36% (L + 4.25%) 12/12/2025 7,406 7,391 7,428

1 unchanged sentence

Business Services 4.36% (L + 4.25%) 7/30/2025 14,571 14,528 14,352

Edgewood Partners Holdings LLC Business Services 5.25% (L + 4.25%) 9/6/2024 7,375 7,320 7,117

Edgewood Partners Holdings LLC (EPIC) Business Services 5.25% (L + 4.25%) 9/6/2024 7,337 7,289 7,264

eResearchTechnology, Inc.

5 unchanged sentences

Software 5.75% (L + 4.75%) 11/19/2026 4,400 4,363 4,432

Institutional Shareholder Services Inc.

Business Services 4.72% (L + 4.50%) 3/5/2026 13,790 13,678 13,376

Keystone Acquisition Corp.

10 unchanged sentences

Ministry Brands, LLC Software 5.00% (L + 4.00%) 12/2/2022 12,003 11,983 11,969

Peraton Corp.

(fka MHVC Acquisition Corp.) Federal Services 6.25% (L + 5.25%) 4/29/2024 10,159 10,130 10,083

Premise Health Holding Corp.

13 unchanged sentences

Healthcare Information Technology 3.62% (L + 3.50%) 9/30/2026 4,078 4,044 4,065

Software 6.00% (L + 5.00%) 11/17/2022 16,844 16,810 16,844

Software 6.00% (L + 5.00%) 11/17/2022 478 474 478

Total Funded Investments $ 255,235 $ 254,344 $ 250,917

Unfunded Investments - First lien:

Bearcat Buyer, Inc.

Healthcare Services — 7/9/2021 $ 194 $ (1) $ —

Total Unfunded Investments $ 194 $ (1) $ —

Total Investments $ 300,199 $ 298,810 $ 286,413

(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 September 30, 2020.

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.

Table o f Contents

The following table is a listing of the individual investments in SLP II's portfolio as of December 31, 2020:

11 unchanged sentences

Federal Services 5.00% (L + 4.75%) 10/31/2026 1,341 1,329 1,341

Bleriot US Bidco Inc.

Federal Services 5.00% (L + 4.75%) 10/30/2026 8,584 8,509 8,584

Brave Parent Holdings, Inc.

5 unchanged sentences

Business Services 5.50% (L + 4.50%) 4/10/2025 10,588 10,556 9,900

CommerceHub, Inc.

Software 5.30% (L + 3.50%) 5/21/2025 2,463 2,453 2,432

Dealer Tire, LLC Distribution & Logistics 4.40% (L + 4.25%) 12/12/2025 7,425 7,409 7,394

Drilling Info Holdings, Inc.

Business Services 4.40% (L + 4.25%) 7/30/2025 14,608 14,563 14,182

Edgewood Partners Holdings LLC Business Services 6.05% (L + 4.25%) 9/6/2024 7,432 7,367 7,413

Explorer Holdings, Inc.

Edgewood Partners Holdings LLC (EPIC) Business Services 5.25% (L + 4.25%) 9/6/2024 7,356 7,304 7,301

eResearchTechnology, Inc.

Healthcare Services 5.50% (L + 4.50%) 2/4/2027 3,129 3,101 3,106

2 unchanged sentences

Greenway Health, LLC Software 4.75% (L + 3.75%) 2/16/2024 14,475 14,439 13,281

Help/Systems Holdings, Inc.

Software 6.55% (L + 4.75%) 11/19/2026 4,444 4,400 4,428

HS Purchaser, LLC / Help/Systems Holdings, Inc.

Software 5.75% (L + 4.75%) 11/19/2026 4,411 4,373 4,411

8 unchanged sentences

Market Track, LLC Business Services 5.25% (L + 4.25%) 6/5/2024 11,580 11,549 11,376

MediaOcean, LLC Software 5.80% (L + 4.00%) 8/18/2025 7,392 7,372 7,410

Medical Solutions Holdings, Inc.

3 unchanged sentences

Ministry Brands, LLC Software 5.00% (L + 4.00%) 12/2/2022 12,034 12,011 11,975

NorthStar Financial Services Group, LLC Software 5.30% (L + 3.50%) 5/25/2025 5,885 5,861 5,789

Peraton Corp.

9 unchanged sentences

Federal Services 7.50% (L + 6.50%) 2/28/2022 12,478 12,445 12,478

Spring Education Group, Inc.

(fka SSH Group Holdings, Inc.) Education 6.19% (L + 4.25%) 7/30/2025 716 715 721

Wirepath LLC Distribution & Logistics 4.25% (L + 4.00%) 8/5/2024 14,663 14,663 14,149

3 unchanged sentences

Zelis Cost Management Buyer, Inc.

Healthcare I.T.

6.55% (L + 4.75%) 9/30/2026 10,363 10,261 10,427

Software 6.93% (L + 5.00%) 11/17/2022 16,975 16,930 16,975

Software 6.84% (L + 5.00%) 11/17/2022 481 477 481

Healthcare Information Technology 4.90% (L + 4.75%) 9/30/2026 4,088 4,053 4,105

Total Funded Investments $ 279,678 $ 278,595 $ 271,149

Unfunded Investments - First lien

Bearcat Buyer, Inc.

Healthcare Services — 7/9/2021 $ 194 $ (1) $ (1)

Bleriot US Bidco Inc.

Federal Services — 10/31/2020 1,351 (14) 15

Premise Health Holding Corp.

Healthcare Services — 7/10/2020 110 — —

Wrench Group LLC Consumer Services — 4/30/2021 $ 1,500 $ — $ 4

Total Unfunded Investments 3,155 (15) 18

Portfolio Company and Type of Investment Industry Interest Rate (1) Maturity Date Principal Amount or Par Value Cost Fair

Total Investments $ 351,160 $ 346,321 $ 339,985

(1) All interest is payable in cash unless otherwise indicated.

3 unchanged sentences

Our board of directors does not determine the fair value of the investments held by SLP II.

Below is certain summarized financial information for SLP II as of September 30, 2020 and December 31, 2019 and for the three and nine months ended September 30, 2020 and September 30, 2019:

Table o f Contents

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:

September 30, 2020 December 31, 2019

March 31, 2021 December 31, 2020

(in thousands) (in thousands)

5 unchanged sentences

Distribution payable 2,500 2,500

Payable for unsettled securities purchased — 3,113

Other liabilities 904 1,058

2 unchanged sentences

Total liabilities and members' capital $ 260,641 $ 279,908

Three Months Ended

Selected Statement of Operations Information:

Three Months Ended Nine Months Ended

September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019

(in thousands) (in thousands) (in thousands) (in thousands)

March 31, 2021 March 31, 2020

(in thousands) (in thousands)

Interest income $ 3,534 $ 5,447

4 unchanged sentences

Total expenses 1,087 2,277

expenses waived and reimbursed — — — (20)

Net expenses 1,288 2,874 5,056 8,872

Net investment income 2,447 3,223

Net realized gains (losses) on investments 3 116 (803) 377

Net realized gains on investments 2 56

Net change in unrealized appreciation (depreciation) of investments 4,019 (34,801)

Net increase in members' capital $ 9,877 $ 915 $ 2,303 $ 8,864

For the three and nine months ended September 30, 2020, we earned approximately $2.0 million and $6.7 million, respectively, of dividend income related to SLP II, which is included in dividend income.

For the three and nine months ended September 30, 2019, we earned approximately $2.5 million and $8.5 million, respectively, of dividend income related to SLP II, which is included in dividend income.

As of September 30, 2020 and December 31, 2019, approximately $2.0 million and $2.6 million, respectively, of dividend income related to SLP II was included in interest and dividend receivable.

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, Accounting Standards Codification Topic 810, Consolidation ("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.

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.

7 unchanged sentences

The investment period may be extended for up to one year pursuant to certain terms of the SLP III Agreement.

Table o f Contents

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 September 30, 2020, we and SkyKnight II have committed and contributed $120.0 million and $30.0 million, respectively, of equity to SLP III.

Our investment in SLP III is disclosed on our Consolidated Schedule of Investments as of September 30, 2020 and December 31, 2019.

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 September 30, 2020 and December 31, 2019, SLP III had total investments with an aggregate fair value of approximately $526.2 million and $475.2 million, respectively, and debt outstanding under its credit facility of $395.2 million and $355.4 million, respectively.

As of September 30, 2020 and December 31, 2019, none of SLP III's investments were on non-accrual.

Additionally, as of September 30, 2020 and December 31, 2019, SLP III had unfunded commitments in the form of delayed draws of $8.8 million and $10.6 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 September 30, 2020 and December 31, 2019:

(in thousands) September 30, 2020 December 31, 2019

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, 2021 December 31, 2020

First lien investments (1) $ 686,095 $ 626,985

5 unchanged sentences

(2) Computed as the all in interest rate in effect on accruing investments divided by the total principal amount of investments.

The following table is a listing of the individual investments in SLP III's portfolio as of September 30, 2020:

Table o f Contents

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 Investment Industry Interest Rate (1) Maturity Date Principal Amount or Par Value Cost Fair

6 unchanged sentences

AG Parent Holdings, LLC Healthcare Services 5.11% (L + 5.00%) 7/31/2026 12,344 12,294 12,297

Ascensus Specialties LLC Business Services 4.91% (L + 4.75%) 9/24/2026 9,925 9,881 9,578

Ascensus Specialties LLC Specialty Chemicals & Materials 4.87% (L + 4.75%) 9/24/2026 9,875 9,835 9,986

Aston FinCo S.a.r.l.

4 unchanged sentences

Distribution & Logistics 4.11% (L + 4.00%) 6/11/2026 10,842 10,756 10,801

BCPE Empire Holdings, Inc.

Distribution & Logistics 4.15% (L + 4.00%) 6/11/2026 1,430 1,421 1,401

Bearcat Buyer, Inc.

4 unchanged sentences

Federal Services 4.20% (L + 4.00%) 10/31/2026 4,950 4,907 4,944

Bleriot US Bidco Inc.

Federal Services 4.97% (L + 4.75%) 10/31/2026 672 666 668

Bluefin Holding, LLC Software 4.11% (L + 4.00%) 9/4/2026 9,875 9,755 9,875

3 unchanged sentences

Software 4.11% (L + 4.00%) 4/18/2025 11,188 11,163 11,197

Cano Health, LLC Healthcare Services 5.50% (L + 4.75%) 11/23/2027 6,291 6,231 6,298

Cardinal Parent, Inc.

Software 5.25% (L + 4.50%) 11/12/2027 7,037 6,935 7,077

CentralSquare Technologies, LLC Software 3.95% (L + 3.75%) 8/29/2025 14,662 14,638 14,069

Certara Holdco, Inc.

Healthcare I.T.

3.72% (L + 3.50%) 8/15/2024 1,249 1,252 1,236

Healthcare Information Technology 3.70% (L + 3.50%) 8/15/2024 1,242 1,245 1,242

CHA Holdings, Inc.

2 unchanged sentences

Software 4.75% (L + 4.00%) 12/29/2027 5,819 5,790 5,833

Confluent Health, LLC Healthcare Services 5.11% (L + 5.00%) 6/24/2026 4,387 4,345 4,387

Covenant Surgical Partners, Inc.

4 unchanged sentences

Dentalcorp Health Services ULC (fka Dentalcorp Perfect Smile ULC) Healthcare Services 4.75% (L + 3.75%) 6/6/2025 16,842 16,797 16,737

DG Investment Intermediate Holdings 2, Inc.

Business Services 4.50% (L + 3.75%) 3/31/2028 6,201 6,170 6,174

DG Investment Intermediate Holdings 2, Inc.

Business Services 4.50% (L + 3.75%) 3/31/2028 500 500 498

Dispatch Acquisition Holdings, LLC Industrial Services 5.00% (L + 4.25%) 3/25/2028 4,179 4,137 4,171

Drilling Info Holdings, Inc.

4 unchanged sentences

EyeCare Partners, LLC Healthcare Services 3.86% (L + 3.75%) 2/18/2027 14,872 14,855 14,737

Fastlane Parent Company, Inc.

Distribution & Logistics 4.65% (L + 4.50%) 2/4/2026 3,448 3,392 3,328

Frontline Technologies Intermediate Holdings, LLC Software 6.75% (L + 5.75%) 9/18/2023 6,497 6,497 6,497

Greenway Health, LLC Software 4.75% (L + 3.75%) 2/16/2024 14,482 14,488 13,849

2 unchanged sentences

Software 5.75% (L + 4.75%) 11/19/2026 18,394 18,231 18,526

Higginbotham Insurance Agency, Inc.

Financial Services 6.50% (L + 5.75%) 11/25/2026 7,187 7,136 7,331

Software 4.50% (L + 3.75%) 3/2/2028 16,085 16,070 16,004

Institutional Shareholder Services Inc.

Business Services 4.72% (L + 4.50%) 3/5/2026 985 977 955

Kestra Advisor Services Holdings A, Inc.

Business Services 4.36% (L + 4.25%) 6/3/2026 12,150 12,083 12,120

LI Group Holdings, Inc.

Software 4.50% (L + 3.75%) 3/11/2028 4,655 4,643 4,672

LSCS Holdings, Inc.

2 unchanged sentences

Healthcare Services 4.51% (L + 4.25%) 3/17/2025 676 673 670

Maravai Intermediate Holdings, LLC Specialty Chemicals & Materials 5.25% (L + 4.25%) 10/19/2027 4,114 4,075 4,132

Market Track, LLC Business Services 5.25% (L + 4.25%) 6/5/2024 6,129 6,062 6,129

4 unchanged sentences

National Intergovernmental Purchasing Alliance Company Business Services 3.95% (L + 3.75%) 5/23/2025 8,679 8,676 8,657

National Mentor Holdings, Inc.

(aka Civitas Solutions, Inc.) Healthcare Services 4.40% (L + 4.25%) 3/9/2026 8,901 8,901 8,823

National Mentor Holdings, Inc.

(aka Civitas Solutions, Inc.) Healthcare Services 4.40% (L + 4.25%) 3/9/2026 406 406 403

Navex Topco, Inc.

Software 3.36% (L + 3.25%) 9/5/2025 18,162 18,038 18,048

Navicure, Inc.

Healthcare Services 4.75% (L + 4.00%) 10/22/2026 4,118 4,107 4,035

Netsmart Technologies, Inc.

Healthcare I.T.

6.00% (P + 2.75%) 4/19/2023 10,250 10,250 10,250

Table o f Contents

Portfolio Company and Type of Investment Industry Interest Rate (1) Maturity Date Principal Amount or Par Value Cost Fair

Newport Group Holdings II, Inc.

4 unchanged sentences

Healthcare Services 3.45% (L + 3.25%) 10/24/2025 3,392 3,386 3,358

Portfolio Company and Type of Investment Industry Interest Rate (1) Maturity Date Principal Amount or Par Value Cost Fair

Pelican Products, Inc.

1 unchanged sentence

Peraton Corp.

(fka MHVC Acquisition Corp.) Federal Services 6.25% (L + 5.25%) 4/29/2024 15,312 15,262 15,197

Federal Services 4.50% (L + 3.75%) 2/1/2028 4,529 4,507 4,531

PetVet Care Centers, LLC (fka Pearl Intermediate Parent LLC) Consumer Services 4.25% (L + 3.50%) 2/14/2025 4,506 4,506 4,502

Planview Parent, Inc.

Software 4.75% (L + 4.00%) 12/17/2027 7,979 7,901 7,994

Premise Health Holding Corp.

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Project Accelerate Parent, LLC Business Services 5.25% (L + 4.25%) 1/2/2025 9,798 9,763 9,447

Project Boost Purchaser, LLC Business Services 5.00% (L + 4.25%) 6/1/2026 1,990 1,971 1,991

Project Ruby Ultimate Parent Corp.

(Mediware) Healthcare I.T.

4.00% (L + 3.25%) 3/10/2028 14,000 13,930 13,959

Quest Software US Holdings Inc.

Software 4.46% (L + 4.25%) 5/16/2025 14,662 14,616 14,678

Ryan Specialty Group, LLC Business Services 4.00% (L + 3.25%) 9/1/2027 3,500 3,448 3,483

RealPage, Inc.

Business Services 3.75% (L + 3.25%) 4/24/2028 14,000 13,965 13,950

Sierra Enterprises, LLC Food & Beverage 5.00% (L + 4.00%) 11/11/2024 2,425 2,423 2,395

Sovos Brands Intermediate, Inc.

Food & Beverage 4.98% (L + 4.75%) 11/20/2025 3,582 3,573 3,600

Spring Education Group, Inc.

(fka SSH Group Holdings, Inc.) Education 4.45% (L + 4.25%) 7/30/2025 12,152 12,131 11,632

Storable, Inc Software 3.75% (L + 3.25%) 2/26/2028 3,862 3,852 3,833

Symplr Software, Inc.(fka Caliper Software, Inc.) Healthcare I.T.

5.25% (L + 4.50%) 12/22/2027 16,000 15,854 16,072

Syndigo LLC Software 5.25% (L + 4.50%) 12/15/2027 15,000 14,891 14,888

TIBCO Software Inc.

Software 3.86% (L + 3.75%) 6/30/2026 7,635 7,618 7,568

Unitek Acquisition, Inc.

Business Services 7.50% (L + 5.50% + 1.00% PIK) 8/20/2024 3,325 2,700 2,975

Unitek Acquisition, Inc.

Business Services 7.50% (L + 5.50% + 1.00% PIK) 8/20/2024 665 540 595

Unified Women’s Healthcare, LP Healthcare Services 5.00% (L + 4.25%) 12/20/2027 9,975 9,900 10,008

Waystar Technologies, Inc.

Healthcare Services 4.11% (L + 4.00%) 10/22/2026 4,097 4,088 4,107

Wirepath LLC Distribution & Logistics 4.20% (L + 4.00%) 8/5/2024 17,083 17,083 16,827

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Unfunded Investments - First lien

BCPE Empire Holdings, Inc.

Distribution & Logistics — 6/11/2021 $ 369 $ (4) (7)

Bearcat Buyer, Inc.

Healthcare Services — 7/9/2021 2,792 (14) —

Cano Health, LLC Healthcare Services — 11/23/2021 $ 2,300 $ (23) $ 2

Covenant Surgical Partners, Inc.

Healthcare Services — 7/1/2021 2,000 (20) (43)

EyeCare Partners, LLC Healthcare Services — 2/18/2022 2,838 — (153)

MED ParentCo, LP Healthcare Services — 8/27/2021 776 (8) (36)

DG Investment Intermediate Holdings 2, Inc.

Business Services — 3/31/2023 799 — (3)

Higginbotham Insurance Agency, Inc.

Financial Services — 11/25/2022 2,023 (15) 40

Peraton Corp.

Federal Services — 2/1/2028 7,971 (40) 3

Total Unfunded Investments $ 15,093 $ (98) $ (1)

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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 September 30, 2020.

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.

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The following table is a listing of the individual investments in SLP III's portfolio as of December 31, 2020:

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AG Parent Holdings, LLC Healthcare Services 5.15% (L + 5.00%) 7/31/2026 12,375 12,323 12,251

Ascensus Specialties LLC Specialty Chemicals & Materials 4.90% (L + 4.75%) 9/24/2026 9,900 9,858 9,931

Aston FinCo S.a.r.l.

/ Aston US Finco, LLC Software 4.40% (L + 4.25%) 10/9/2026 5,955 5,904 5,900

Ascensus Specialties LLC Business Services 6.44% (L + 4.75%) 9/24/2026 10,000 9,951 9,975

BCPE Empire Holdings, Inc.

Distribution & Logistics 5.80% (L + 4.00%) 6/11/2026 9,167 9,080 9,224

Astra Acquisition Corp.

Software 6.50% (L + 5.50%) 3/1/2027 11,490 11,412 11,605

BCPE Empire Holdings, Inc.

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Federal Services 5.00% (L + 4.75%) 10/31/2026 4,292 4,254 4,292

Bleriot US Bidco Inc.

Federal Services 5.00% (L + 4.75%) 10/31/2026 671 665 671

Bluefin Holding, LLC Software 4.15% (L + 4.00%) 9/4/2026 9,900 9,775 9,900

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Software 4.15% (L + 4.00%) 4/18/2025 11,217 11,190 11,147

Cano Health, LLC Healthcare Services 5.50% (L + 4.75%) 11/23/2027 6,308 6,244 6,244

Cardinal Parent, Inc.

Software 5.25% (L + 4.50%) 11/12/2027 7,038 6,932 6,967

CentralSquare Technologies, LLC Software 4.00% (L + 3.75%) 8/29/2025 14,700 14,674 13,745

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Software 4.75% (L + 4.00%) 12/29/2027 5,833 5,804 5,833

Confluent Health, LLC Healthcare Services 5.15% (L + 5.00%) 6/24/2026 4,398 4,354 4,348

Covenant Surgical Partners, Inc.

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Business Services 3.65% (L + 3.50%) 8/8/2025 14,663 14,611 14,498

Dealer Tire, LLC Distribution & Logistics 4.40% (L + 4.25%) 12/12/2025 9,900 9,879 9,859

Dentalcorp Health Services ULC (fka Dentalcorp Perfect Smile ULC) Healthcare Services 4.75% (L + 3.75%) 6/6/2025 14,636 14,611 14,421

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Edgewood Partners Holdings LLC Business Services 5.25% (L + 4.25%) 9/6/2024 7,356 7,304 7,301

Explorer Holdings, Inc.

eResearchTechnology, Inc.

Healthcare Services 5.50% (L + 4.50%) 2/4/2027 3,911 3,876 3,883

EyeCare Partners, LLC Healthcare Services 3.90% (L + 3.75%) 2/18/2027 12,071 12,057 11,796

EyeCare Partners, LLC Healthcare Services 3.90% (L + 3.75%) 2/18/2027 2,838 2,834 2,773

Fastlane Parent Company, Inc.

Distribution & Logistics 4.65% (L + 4.50%) 2/4/2026 3,439 3,386 3,419

Frontline Technologies Intermediate Holdings, LLC Software 6.75% (L + 5.75%) 9/18/2023 6,513 6,513 6,513

Greenway Health, LLC Software 4.75% (L + 3.75%) 2/16/2024 14,520 14,527 13,322

Heartland Dental, LLC Healthcare Services 3.65% (L + 3.50%) 4/30/2025 18,540 18,478 18,104

Help/Systems Holdings, Inc.

HS Purchaser, LLC / Help/Systems Holdings, Inc.

Software 5.75% (L + 4.75%) 11/19/2026 18,440 18,270 18,440

Higginbotham Insurance Agency, Inc.

Financial Services 6.50% (L + 5.75%) 11/25/2026 7,187 7,134 7,331

Software 5.00% (L + 4.00%) 6/28/2024 9,435 9,406 9,435

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Healthcare Services 4.51% (L + 4.25%) 3/17/2025 678 674 665

Maravai Intermediate Holdings, LLC Specialty Chemicals & Materials 5.25% (L + 4.25%) 10/19/2027 4,125 4,085 4,148

Market Track, LLC Business Services 5.25% (L + 4.25%) 6/5/2024 4,729 4,725 4,645

Mavis Tire Express Services Corp.

Retail 5.00% (L + 4.00%) 3/20/2025 4,828 4,733 4,846

MED ParentCo, LP Healthcare Services 4.40% (L + 4.25%) 8/31/2026 10,272 10,191 10,148

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National Intergovernmental Purchasing Alliance Company Business Services 4.00% (L + 3.75%) 5/23/2025 8,701 8,698 8,658

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Portfolio Company and Type of Investment Industry Interest Rate (1) Maturity Date Principal Amount or Par Value Cost Fair

National Mentor Holdings, Inc.

(aka Civitas Solutions, Inc.) Healthcare Services 4.43% (L + 4.25%) 3/9/2026 $ 8,887 $ 8,887 $ 8,897

National Mentor Holdings, Inc.

(aka Civitas Solutions, Inc.) Healthcare Services 4.51% (L + 4.25%) 3/9/2026 398 398 398

Navex Topco, Inc.

Software 3.40% (L + 3.25%) 9/5/2025 18,208 18,079 17,929

Netsmart Technologies, Inc.

Healthcare I.T.

5.55% (L + 3.75%) 4/19/2023 10,330 10,330 10,308

Navicure, Inc.

Healthcare Services 4.75% (L + 4.00%) 10/22/2026 4,107 4,097 4,110

Newport Group Holdings II, Inc.

Business Services 3.75% (L + 3.50%) 9/12/2025 4,888 4,870 4,851

NorthStar Financial Services Group, LLC Software 5.30% (L + 3.50%) 5/25/2025 11,770 11,723 11,579

Orion Advisor Solutions, Inc.

Business Services 5.00% (L + 4.00%) 9/24/2027 5,237 5,186 5,260

Outcomes Group Holdings, Inc.

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(fka MHVC Acquisition Corp.) Federal Services 6.25% (L + 5.25%) 4/29/2024 15,272 15,225 15,310

Planview Parent, Inc.

Software 4.75% (L + 4.00%) 12/17/2027 6,484 6,419 6,496

Premise Health Holding Corp.

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Project Accelerate Parent, LLC Business Services 5.25% (L + 4.25%) 1/2/2025 9,822 9,786 8,939

Project Boost Purchaser, LLC Business Services 5.00% (L + 4.25%) 6/1/2026 1,995 1,975 2,002

Quest Software US Holdings Inc.

Software 4.46% (L + 4.25%) 5/16/2025 14,700 14,650 14,480

Ryan Specialty Group, LLC Business Services 4.00% (L + 3.25%) 9/1/2027 3,491 3,441 3,491

Sierra Enterprises, LLC Food & Beverage 5.00% (L + 4.00%) 11/11/2024 2,431 2,429 2,393

Sovos Brands Intermediate, Inc.

Food & Beverage 4.96% (L + 4.75%) 11/20/2025 3,591 3,582 3,609

Spring Education Group, Inc.

(fka SSH Group Holdings, Inc.) Education 4.50% (L + 4.25%) 7/30/2025 12,183 12,161 11,665

Symplr Software, Inc.(fka Caliper Software, Inc.) Healthcare I.T.

5.25% (L + 4.50%) 12/22/2027 10,000 9,850 9,913

Syndigo LLC Software 5.25% (L + 4.50%) 12/15/2027 15,000 14,888 14,888

TIBCO Software Inc.

Software 3.90% (L + 3.75%) 6/30/2026 7,654 7,637 7,572

Unified Women’s Healthcare, LP Healthcare Services 5.00% (L + 4.25%) 12/20/2027 10,000 9,923 9,975

Wirepath LLC Distribution & Logistics 4.25% (L + 4.00%) 8/5/2024 17,127 17,127 16,527

WP CityMD Bidco LLC Healthcare Services 5.50% (L + 4.50%) 8/13/2026 19,868 19,701 19,914

Portfolio Company and Type of Investment Industry Interest Rate (1) Maturity Date Principal Amount or Par Value Cost Fair

VT Topco, Inc.

Business Services 3.65% (L + 3.50%) 8/1/2025 2,795 2,795 2,763

YI, LLC Healthcare Services 5.00% (L + 4.00%) 11/7/2024 9,691 9,685 8,915

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Unfunded Investments - First lien

BCPE Empire Holdings, Inc.

Distribution & Logistics — 6/11/2021 $ 1,580 $ (16) $ 10

Bearcat Buyer, Inc.

Healthcare Services — 7/9/2021 2,792 (14) (14)

Bleriot US Bidco Inc.

Federal Services — 10/31/2020 676 (7) 8

Cano Health, LLC Healthcare Services — 11/23/2021 $ 2,300 $ (23) $ (23)

Covenant Surgical Partners, Inc.

Healthcare Services — 7/1/2021 2,000 (20) (40)

Heartland Dental, LLC Healthcare Services — 4/30/2020 413 — (2)

MED ParentCo, LP Healthcare Services — 8/27/2021 2,044 (20) 5

Premise Health Holding Corp.

Healthcare Services — 7/10/2020 1,103 (3) (3)

Higginbotham Insurance Agency, Inc.

Financial Services — 11/25/2022 2,023 (15) 40

Planview Parent, Inc.

Software — 3/31/2021 1,515 — 3

Total Unfunded Investments $ 7,838 $ (58) $ (20)

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Our board of directors does not determine the fair value of the investments held by SLP III.

Below is certain summarized financial information for SLP III as of September 30, 2020 and December 31, 2019 and for the three and nine months ended September 30, 2020 and September 30, 2019:

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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:

September 30, 2020 December 31, 2019

March 31, 2021 December 31, 2020

(in thousands) (in thousands)

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Total liabilities and members' capital $ 691,983 $ 620,137

Three Months Ended

Selected Statement of Operations Information:

Three Months Ended Nine Months Ended

September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019

(in thousands) (in thousands) (in thousands) (in thousands)

March 31, 2021 March 31, 2020

(in thousands) (in thousands)

Interest income $ 7,371 $ 7,407

4 unchanged sentences

Total expenses 2,755 3,853

expenses waived and reimbursed — — — (22)

Net expenses 2,766 3,936 10,164 10,958

Net investment income 4,719 3,735

Net realized (losses) gains on investments (82) 100 (78) 170

Net realized gains (losses) on investments 212 (2)

Net change in unrealized appreciation (depreciation) of investments 4,809 (63,348)

Net increase in members' capital $ 18,492 $ 1,754 $ 525 $ 11,165

For the three and nine months ended September 30, 2020, we earned approximately $3.2 million and $8.8 million of dividend income related to SLP III, which is included in dividend income.

For the three and nine months ended September 30, 2019, we earned approximately $2.7 million and $7.6 million of dividend income related to SLP III, which is included in dividend income.

As of September 30, 2020 and December 31, 2019, approximately $3.2 million and $2.9 million, respectively, of dividend income related to SLP III was included in interest and dividend receivable.

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;

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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 September 30, 2020.

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.

NMNLC's investments are disclosed on our Consolidated Schedule of Investments as of March 31, 2021.

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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 September 30, 2020:

Below is certain summarized property information for NMNLC as of March 31, 2021:

Lease Total Fair Value as of

Portfolio Company Tenant Expiration Date Location Square Feet September 30, 2020

Portfolio Company Tenant Expiration Date Location Square Feet March 31, 2021

(in thousands) (in thousands)

6 unchanged sentences

9/30/2031 Canada 436 12,488

NM DRVT LLC FMH Conveyors, LLC 10/31/2031 AR 195 6,980

NM APP US LLC Plasman Corp, LLC / A-Brite LP 9/30/2033 AL / OH 261 7,525

NM DRVT LLC FMH Conveyors, LLC 10/31/2031 AR 195 7,194

NM YI, LLC Young Innovations, Inc.

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Interest on collateralized agreements is accrued and recognized over the life of the transaction and included in interest income.

As of September 30, 2020 and December 31, 2019, 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.

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.

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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.

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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 September 30, 2020 and December 31, 2019, 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.

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

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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 and nine months ended September 30, 2020, we recognized PIK and non-cash interest from investments of approximately $5.0 million and $11.7 million, respectively, and PIK and non-cash dividends from investments of approximately $3.8 million and $9.2 million, respectively.

For the three and nine months ended September 30, 2019, we recognized PIK and non-cash interest from investments of approximately $3.8 million and $9.9 million, respectively, and PIK and non-cash dividends from investments of approximately $4.8 million and $13.6 million, respectively.

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.

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There is meaningful possibility that we will not recoup our original cost basis in the investment and may realize a substantial loss upon exit.

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 September 30, 2020:

(in millions) As of September 30, 2020

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(in millions) As of March 31, 2021

Investment Rating Cost Percent Fair Value Percent

4 unchanged sentences

$ 3,059.3 100.0 % $ 3,040.0 100.0 %

As of September 30, 2020, all investments in our portfolio had an Investment Rating of 1 or 2 with the exception of eight portfolio companies that had an Investment Rating of 3 and six portfolio companies that had an Investment Rating of 4.

During the second quarter of 2020, we placed a portion of our first lien positions in Benevis Holding Corp.

on non-accrual status with an investment rating of 4 due to its ongoing restructuring, which included the filing for Chapter 11 bankruptcy protection in the U.S.

Bankruptcy Court for the Southern District of Texas on August 3, 2020.

As of September 30, 2020, our investment in Benevis Holding Corp., which was placed on non-accrual status, had an aggregate cost basis of $42.8 million, an aggregate fair value of $39.3 million and total unearned interest income of $0.8 million and $1.6 million for the three and nine months then ended.

During the second quarter of 2020, our subordinated position in Permian Holdco 3, Inc.

was placed on non-accrual status and had an investment rating of 4.

Our subordinated positions in Permian Holdco 2, Inc.

and preferred shares in Permian Holdco 1, Inc.

remain on non-accrual status with an investment rating of 4 due to its ongoing restructuring, which included the filing for Chapter 11 bankruptcy protection in the U.S.

Bankruptcy Court for the District of Delaware on July 19, 2020.

As of September 30, 2020, our common shares in Permian Holdco 1, Inc.

and first lien position in Permian Holdco 3, Inc.

had an investment rating of 4.

As of September 30, 2020, our investments in Permian Holdco 1, Inc., Permian Holdco 2, Inc.

and Permian Holdco 3, Inc., on non-accrual had an aggregate cost basis of $10.9 million and an aggregate fair value of $0.0 million.

As of September 30, 2020, our investments in Permian Holdco 1, Inc., Permian Holdco 2, Inc.

and Permian Holdco 3, Inc.

with an investment rating of 4 had an aggregate cost basis of $23.1 million and an aggregate fair value of $10.5 million.

During the three months ended March 31, 2020, we reversed $3.4 million of previously recorded PIK dividends related to our investment in Permian Holdco 1, Inc.

as we believe these PIK dividends will ultimately not be collectible.

During the three months ended June 30, 2020, we reversed $2.0 million of previously recorded PIK interest related to our investments in Permian Holdco 2, Inc.

as we believe this PIK interest will ultimately not be collectible.

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.

on non-accrual status and the investment had a rating of 4.

As of September 30, 2020, our investment had an aggregate cost basis of $34.4 million, an aggregate fair value of $3.6 million and total unearned dividend income $1.3 million and $2.6 million of for the three and nine months then ended.

("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") had an investment rating of 4.

As of September 30, 2020, 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 and $0.0 million for the three and nine months ended.

Since March 31, 2020, our investment in NM KRLN LLC had an investment rating of 4.

As of September 30, 2020, NM KRLN LLC had an aggregate cost basis of $8.2 million and an aggregate fair value of $0.9 million.

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 September 30, 2020, our investment in this security had an aggregate cost basis of $14.5 million and an aggregate fair value of $10.4 million.

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 September 30, 2020, our investment in this security had an aggregate cost basis of $30.0 million and an aggregate fair value of $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 COVID-19.

The evaluation process consisted of dialogue with sponsors and portfolio companies to understand

COVID-19’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.

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.

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 September 30, 2020:

(in millions) As of September 30, 2020

The following table shows the Risk Rating of our portfolio companies as of March 31, 2021:

(in millions) As of March 31, 2021

Risk Rating Cost Percent Fair Value Percent

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$ 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 $2,896.6 million in 105 portfolio companies at September 30, 2020 and approximately $3,160.3 million in 114 portfolio companies at December 31, 2019.

The following table shows our portfolio and investment activity for the nine months ended September 30, 2020 and September 30, 2019:

Nine Months Ended

(in millions) September 30, 2020 September 30, 2019

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, 2021 March 31, 2020

New investments in 13 and 17 portfolio companies, respectively $ 223.4 $ 181.7

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Recent Accounting Standards for details on recent accounting standards updates.

Results of Operations for the Three Months Ended September 30, 2020 and September 30, 2019

Results of Operations for the Three Months Ended March 31, 2021 and March 31, 2020

Three Months Ended

(in thousands) September 30, 2020 September 30, 2019

(in thousands) March 31, 2021 March 31, 2020

Total interest income $ 47,009 $ 61,636

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Total investment income $ 67,708 $ 74,084

Our total investment income decreased by approximately $7.1 million, or (10)%, for the three months ended September 30, 2020 as compared to the three months ended September 30, 2019.

For the three months ended September 30, 2020, total investment income of approximately $65.5 million consisted of approximately $43.0 million in cash interest from investments, approximately $5.0 million in PIK and non-cash interest from investments, approximately $0.3 million in prepayment fees, net amortization of purchase premiums and discounts of approximately $1.4 million, approximately $8.8 million in cash dividends from investments, approximately $3.8 million in PIK and non-cash dividends from investments and approximately $3.2 million in other income.

Our interest income decreased by approximately $5.6 million during the three months ended September 30, 2020 as compared to the three months ended September 30, 2019 which was primarily attributable to lower LIBOR rates on invested balances in 2020.

Our dividend income for the three months ended September 30, 2020 as compared to the three months ended September 30, 2019 remained relatively flat.

Other income during the three months ended September 30, 2020, which represents fees that are generally non-recurring in nature, was primarily attributable to upfront, consent and amendment fees received from 9 different portfolio companies and management fees from a non-controlled affiliated portfolio company.

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) September 30, 2020 September 30, 2019

(in thousands) March 31, 2021 March 31, 2020

Management fee $ 13,420 $ 13,858

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Incentive fee 7,248 7,826

incentive fee waiver (500) —

Total incentive fee 6,635 7,792

Interest and other financing expenses 19,385 22,194

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Total expenses 38,713 42,779

expenses waived and reimbursed (589) —

Net expenses before income taxes 36,356 41,424

Income tax expense 1 —

Net expenses after income taxes $ 38,714 $ 42,779

Our total net operating expenses decreased by approximately $4.9 million for the three months ended September 30, 2020 as compared to the three months ended September 30, 2019.

Our management fee increased by approximately $0.5 million, net of a management fee waiver, and our incentive fee decreased by approximately $1.2 million, net of an incentive fee waiver, for the three months ended September 30, 2020 as compared to the three months ended September 30, 2019.

The increase in management fees was attributable to larger invested balances while the incentive fee decreased due to lower investment income driven by decreasing LIBOR rates in 2020 and an incentive fee waiver by the Investment Adviser.

Interest and other financing expenses decreased by approximately $3.8 million during the three months ended September 30, 2020 as compared to the three months ended September 30, 2019, primarily due to lower rates on our floating rate borrowings.

Our total professional fees, administrative expenses and total other general and administrative expenses for the three months ended September 30, 2020 as compared to the three months ended September 30, 2019 decreased by

approximately $0.6 million, which was primarily attributable to the Administrator's waiver of indirect administrative expenses during the quarter ended September 30, 2020.

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) September 30, 2020 September 30, 2019

Net realized gains on investments $ 47 $ 355

(in thousands) March 31, 2021 March 31, 2020

Net realized (losses) gains on investments $ (10,496) $ 114

Net change in unrealized appreciation (depreciation) of investments 33,472 (204,739)

Net change in unrealized depreciation securities purchased under collateralized agreements to resell — (1,332)

Benefit for taxes 257 281

(Provision) benefit for taxes (115) 898

Net realized and unrealized gains (losses) $ 22,861 $ (203,727)

Our net realized and unrealized gains resulted in a net gain of approximately $60.5 million for the three months ended September 30, 2020 compared to net realized gains and unrealized losses resulting in a net loss of approximately $7.7 million for the same period in 2019.

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 September 30, 2020 was primarily driven by the overall increase in market prices of our investments during the period due to the partial recovery of the market from the impact of the COVID-19 pandemic.

The provision for income taxes was attributable to equity investments that are held as of September 30, 2020 in three of our corporate subsidiaries.

The net loss for the three months ended September 30, 2019 was primarily driven by the overall decrease in market prices of our investments during the period.

Results of Operations for the Nine Months Ended September 30, 2020 and September 30, 2019

Nine Months Ended

(in thousands) September 30, 2020 September 30, 2019

Total interest income $ 162,653 $ 154,779

Total dividend income 35,353 39,338

Other income 7,566 9,133

Total investment income $ 205,572 $ 203,250

Our total investment income increased by approximately $2.3 million, or 1%, for the nine months ended September 30, 2020 as compared to the nine months ended September 30, 2019.

For the nine months ended September 30, 2020, total investment income of approximately $205.6 million consisted of approximately $141.8 million in cash interest from investments, approximately $11.7 million in PIK and non-cash interest from investments, approximately $1.3 million in prepayment fees, net amortization of purchase premiums and discounts of approximately $7.9 million, approximately $26.2 million in cash dividends from investments, approximately $9.2 million in PIK and non-cash dividends from investments and approximately $7.5 million in other income.

The increase in interest income of approximately $7.9 million during the nine months ended September 30, 2020 as compared to the nine months ended September 30, 2019 was primarily due to increased interest income which is attributable to larger invested balances.

Our larger invested balances were driven by higher drawn balances on our SBA-guaranteed debentures and revolving credit facilities and proceeds from the July 2019 and October 2019 public offerings of our common stock, all of which contributed to the origination of new investments.

The decrease in dividend income for the nine months ended September 30, 2020 as compared to the nine months ended September 30, 2019 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.

Other income during the nine months ended September 30, 2020, which represents fees that are generally non-recurring in nature, was primarily attributable to upfront, consent and amendment fees received from 21 different portfolio companies and management fees from a non-controlled affiliated portfolio company.

Operating Expenses

Nine Months Ended

(in thousands) September 30, 2020 September 30, 2019

Management fee $ 39,869 $ 35,302

management fee waiver (9,567) (8,497)

Total management fee 30,302 26,805

Incentive fee 21,857 21,642

incentive fee waiver (500) —

Total incentive fee 21,357 21,642

Interest and other financing expenses 59,500 61,695

Administrative expenses 3,303 3,074

Professional fees 2,605 2,486

Other general and administrative expenses 1,383 1,302

Total expenses 118,450 117,004

expenses waived and reimbursed (924) (335)

Net expenses before income taxes 117,526 116,669

Income tax expense 116 13

Net expenses after income taxes $ 117,642 $ 116,682

Our total net operating expenses increased by approximately $1.0 million for the nine months ended September 30, 2020 as compared to the nine months ended September 30, 2019.

Our management fee increased by approximately $3.5 million, net of a management fee waiver, and our incentive fee decreased by approximately $0.3 million, net of an incentive fee waiver, for the nine months ended September 30, 2020 as compared to the nine months ended September 30, 2019.

The increase in management fees was attributable to larger invested balances, driven by our use of leverage from our revolving credit facilities and SBA-guaranteed debentures and proceeds from our July 2019 and October 2019 public offerings of our common stock used to originate new investments.

Interest and other financing expenses decreased by approximately $2.2 million during the nine months ended September 30, 2020 as compared to the nine months ended September 30, 2019, primarily due to lower LIBOR rates on our floating rate borrowings.

Our total professional fees, administrative expenses and total other general and administrative expenses for the nine months ended September 30, 2020 as compared to the nine months ended September 30, 2019 remained relatively flat.

Net Realized Gains (Losses) and Net Change in Unrealized Appreciation (Depreciation)

Nine Months Ended

(in thousands) September 30, 2020 September 30, 2019

Net realized (losses) gains on investments $ (3,595) $ 453

Net change in unrealized (depreciation) appreciation of investments (91,215) 5,305

Net change in unrealized depreciation securities purchased under collateralized agreements to resell — (1,332)

Benefit for taxes 778 121

Net realized and unrealized (losses) gains $ (94,032) $ 4,547

Our net realized and unrealized losses resulted in a net loss of approximately $94.0 million for the nine months ended September 30, 2020 compared to net realized and unrealized gains resulting in a net gain of approximately $4.5 million for the same period in 2019.

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 loss for the nine months ended September 30, 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.

The provision for income taxes was attributable to equity investments that are held as of September 30, 2020 in three of our corporate subsidiaries.

The net gain for the nine months ended September 30, 2019 was primarily driven by the overall increase in market prices of our investments during the period.

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 September 30, 2020, we raised approximately $893.2 million in net proceeds from additional offerings of common stock.

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.

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Any such incurrence or issuance would be subject to prevailing market conditions, our liquidity requirements, contractual and regulatory restrictions and other factors.

As permitted by the Small Business Credit Availability Act (the “SBCA”) 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, as amended by the SBCA, 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.

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).

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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 September 30, 2020, our asset coverage ratio was 178.7% as compared to 177.7% as of June 30, 2020.

At September 30, 2020 and December 31, 2019, we had cash and cash equivalents of approximately $68.7 million and $48.6 million, respectively.

Our cash provided by (used in) operating activities during the nine months ended September 30, 2020 and September 30, 2019 was approximately $269.6 million and $(473.6) million, respectively.

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.

Holdings Credit Facility —On December 18, 2014, we entered into the Second 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").

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 September 30, 2020, the maximum amount of revolving borrowings available under the Holdings Credit Facility is $745.0 million.

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.

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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 Fourth Amendment to the Loan and Security Agreement) and LIBOR plus 2.50% per annum for all other investments.

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 Fourth Amendment to the 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 and nine months ended September 30, 2020 and September 30, 2019.

Three Months Ended Nine Months Ended

(in millions) September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019

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, 2021 March 31, 2020

Interest expense $ 2.7 $ 5.4

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Average debt outstanding $ 450.2 $ 629.5

As of September 30, 2020 and December 31, 2019, the outstanding balance on the Holdings Credit Facility was $459.2 million and $661.6 million, respectively, and NMF Holdings was in compliance with the applicable covenants in the Holdings Credit Facility on such dates.

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.

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The maturity date of the NMFC Credit Facility is June 4, 2022.

As of September 30, 2020, the maximum amount of revolving borrowings available under the NMFC Credit Facility was $188.5 million.

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.

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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 and nine months ended September 30, 2020 and September 30, 2019.

Three Months Ended Nine Months Ended

(in millions) September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019

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, 2021 March 31, 2020

Interest expense $ 0.7 $ 1.9

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Average debt outstanding $ 104.5 $ 188.5

(1) For the three months ended September 30, 2019, the total non-usage fees were less than $50.0 thousand.

(2) For the three months ended September 30, 2020, the total amortization of financing costs were less than $50.0 thousand.

As of September 30, 2020 and December 31, 2019, the outstanding balance on the NMFC Credit Facility was $150.5 million and $188.5 million, respectively, and NMFC was in compliance with the applicable covenants in the NMFC Credit Facility on such dates.

(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 December 14, 2023.

As of September 30, 2020, the maximum amount of revolving borrowings available under the DB Credit Facility was $280.0 million.

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.

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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.

The "Applicable Margin" is equal to 2.85% during the Revolving Period and then increases by 0.20% during an Event of Default.

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).

The following table summarizes the interest expense, non-usage fees and amortization of financing costs incurred on the DB Credit Facility for the three and nine months ended September 30, 2020 and September 30, 2019.

Three Months Ended Nine Months Ended

(in millions) September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019

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, 2021 March 31, 2020

Interest expense(1) $ 1.7 $ 2.6

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(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 September 30, 2020 and December 31, 2019, the outstanding balance on the DB Credit Facility was $242.0 million and $230.0 million, respectively, and NMFDB was in compliance with the applicable covenants in the DB Credit Facility on such date.

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.

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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 September 30, 2020, 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 and nine months ended September 30, 2020, amortization of financing costs were each less than $50.0 thousand, respectively.

NMNLC Credit Facility —The Revolving Credit Agreement (together with the related guarantee and security agreement, the “NMNLC Credit Facility”), dated September 21, 2018, among 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.

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 and nine months ended September 30, 2020, interest expense, non-usage fees and amortization of financing costs were each less than $50.0 thousand.

For the three months ended September 30, 2019, interest expense, non-usage fees and amortization of financing costs were each less than $50.0 thousand.

For the nine months ended September 30, 2019, interest expense and non-usage fees were each less than $50.0 thousand and amortization of financing costs was $0.1 million.

The NMNLC Credit Facility matured on September 23, 2020.

As of December 31, 2019, the outstanding balance on the NMNLC Credit Facility was $0 and NMNLC was in compliance with the applicable covenants in the NMNLC Credit Facility on such date.

Convertible Notes

2014 Convertible Notes —On June 3, 2014, we closed a private offering of $115.0 million aggregate principal amount of unsecured convertible notes (the “2014 Convertible Notes”), pursuant to an indenture, dated June 3, 2014 (the “2014 Indenture”).

The 2014 Convertible Notes were issued in a private placement only to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the "Securities Act").

As of June 3, 2015, the restrictions under Rule 144A under the Securities Act were removed, allowing the 2014 Convertible Notes to be eligible and freely tradable without restrictions for resale pursuant to Rule 144(b)(1) under the Securities Act.

On September 30, 2016, we closed a public offering of an additional $40.3 million aggregate principal amount of the 2014 Convertible Notes.

These additional 2014 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 2014 Convertible Notes that we issued on June 3, 2014.

The 2014 Convertible Notes bore interest at an annual rate of 5.0%, payable semi-annually in arrears on June 15 and December 15 of each year, which commenced on December 15, 2014.

On June 15, 2019, our $155.3 million aggregate principal amount of 2014 Convertible Notes matured and we repaid the outstanding principal and accrued but unpaid interest in cash.

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”).

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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 and Exchange Act of 1934, as amended (the "Exchange Act").

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.

The following table summarizes certain key terms related to the convertible features of our 2018 Convertible Notes as of September 30, 2020.

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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

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Initial conversion price $ 15.18

Conversion premium at September 30, 2020 10.0 %

Conversion rate at September 30, 2020(1)(2) 65.8762

Conversion price at September 30, 2020(2)(3) $ 15.18

Conversion premium at March 31, 2021 10.0 %

Conversion rate at March 31, 2021(1)(2) 65.8762

Conversion price at March 31, 2021(2)(3) $ 15.18

Last conversion price calculation date August 20, 2020

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(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 September 30, 2020 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.

(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.

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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 Convertible Notes for the three and nine months ended September 30, 2020 and September 30, 2019.

Three Months Ended Nine Months Ended

(in millions) September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019

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, 2021 March 31, 2020

Interest expense $ 2.9 $ 2.9

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Average debt outstanding $ 201.3 $ 201.3

(1) For the three months ended September 30, 2020 and September 30, 2019, the amortization of premium was less than $50.0 thousand.

As of September 30, 2020 and December 31, 2019, the outstanding balance on the 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.

(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 five-year unsecured notes that mature on May 15, 2021 (the “2016 Unsecured Notes”), pursuant to a note purchase agreement, dated May 4, 2016, to an institutional investor in a private placement.

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.

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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.

The 2016 Unsecured Notes bear interest at an annual rate of 5.313%, payable semi-annually on May 15 and November 15 of each year.

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.

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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:

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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 five-year 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 and 2018B 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 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.

The 5.75% Unsecured Notes bear 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 will mature on October 1, 2023 unless earlier redeemed.

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 LLC under the ticker symbol "NMFCL".

We may redeem the 5.75% Unsecured Notes, in whole or in part, at any time, or from time to time, at our option on or after October 1, 2020, upon not less than 30 days nor more than 60 days written notice by mail prior to the date fixed for redemption thereof, at a redemption price of 100% of the outstanding principal amount thereof plus accrued and unpaid interest payments otherwise payable for the then-current quarterly interest period accrued to but not including the date fixed for redemption.

No sinking fund is provided for the 5.75% Unsecured Notes and holders of the 5.75% Unsecured Notes have no option to have their 5.75% Unsecured Notes repaid prior to the stated maturity date.

The 2018B Indenture contains certain covenants, including covenants requiring us to (i) comply with the asset coverage requirements set forth in Section 18(a)(1)(A) of the 1940 Act as modified by Section 61(a) of the 1940 Act as may be

applicable to us from time to time or any successor provisions, whether or not we continue to be subject to such provisions of the 1940 Act, but giving effect, in either case, to any exemptive relief granted to us by the SEC and (ii) provide certain financial information to the holders of the 5.75% Unsecured Notes and the trustee if we cease to be subject to the reporting requirements of the Exchange Act.

The 2018B Indenture also includes additional financial covenants related to asset coverage.

These covenants are subject to limitations and exceptions that are described in the 2018B Indenture.

The 2018B Indenture provides for customary events of default and further provides that the trustee or the holders of 25% in aggregate principal amount of the outstanding 5.75% Unsecured Notes may declare such 5.75% Unsecured Notes immediately due and payable upon the occurrence of any event of default after expiration of any applicable grace period.

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;

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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 and nine months ended September 30, 2020 and September 30, 2019.

Three Months Ended Nine Months Ended

(in millions) September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019(1)

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, 2021 March 31, 2020

Interest expense $ 6.5 $ 6.0

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Average debt outstanding $ 532.2 $ 453.3

(1) For the nine months ended September 30, 2019, amounts reported include interest and amortization of financing costs related to the 2019A Unsecured Notes for the period from April 30, 2019 (issuance date of the 2019A Unsecured Notes) to September 30, 2019.

As of September 30, 2020 and December 31, 2019, the outstanding balance on the Unsecured Notes was $453.3 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.

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.

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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 September 30, 2020 and December 31, 2019, 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 September 30, 2020 and December 31, 2019, SBIC II had regulatory capital of $75.0 million and $64.5 million, respectively, and $150.0 million and $75.0 million, respectively, of SBA-guaranteed debentures outstanding.

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.

The following table summarizes our SBA-guaranteed debentures as of September 30, 2020.

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The following table summarizes our SBA-guaranteed debentures as of March 31, 2021:

(in millions)

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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 and nine months ended September 30, 2020 and September 30, 2019.

Three Months Ended Nine Months Ended

(in millions) September 30, 2020 September 30, 2019 September 30, 2020 September 30, 2019

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, 2021 March 31, 2020

Interest expense $ 2.0 $ 1.8

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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 September 30, 2020 and December 31, 2019, SBIC I and SBIC II were in compliance with SBA regulatory requirements.

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

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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 September 30, 2020 and December 31, 2019, we had outstanding commitments to third parties to fund investments totaling $93.8 million and $203.8 million, respectively, under various undrawn revolving credit facilities, delayed draw commitments or other future funding commitments.

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 September 30, 2020 and December 31, 2019, we had commitment letters to purchase investments in an aggregate par amount of $0 and $34.2 million, respectively.

As of September 30, 2020 and December 31, 2019, we had not entered into any 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 September 30, 2020 is as follows:

A summary of our significant contractual payment obligations as of March 31, 2021 is as follows:

Contractual Obligations Payments Due by Period

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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 ($459.2 million as of September 30, 2020) must be repaid on or before September 30, 2023.

As of September 30, 2020, there was approximately $285.8 million of possible capacity remaining under the Holdings Credit Facility.

(2) $90.0 million of the 2016 Unsecured Notes will mature on May 15, 2021 unless earlier repurchased, $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, $51.8 million of the 5.75% Unsecured Notes will mature on October 1, 2023 unless earlier repurchased and $116.5 million of the 2019A Unsecured Notes will mature on April 30, 2024 unless earlier repurchased.

(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 ($242.0 million as of September 30, 2020) must be repaid on or before December 14, 2023.

As of September 30, 2020, there was approximately $38.0 million of possible capacity remaining under the DB Credit Facility.

(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 ($150.5 million as of September 30, 2020) must be repaid on or before June 4, 2022.

As of September 30, 2020, there was approximately $38.0 million of available capacity remaining under the NMFC Credit Facility.

(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.

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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 conduct our respective day-to-day operations.

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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.

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Distributions and Dividends

Distributions declared and paid to stockholders for the nine months ended September 30, 2020 totaled approximately $91.0 million.

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:

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December 31, 2021

Third Quarter July 29, 2020 September 16, 2020 September 30, 2020 $ 0.30

Second Quarter April 29, 2020 June 16, 2020 June 30, 2020 0.30

First Quarter February 17, 2021 March 17, 2021 March 31, 2021 $ 0.30

December 31, 2020

Fourth Quarter November 4, 2019 December 13, 2019 December 27, 2019 $ 0.34

Third Quarter August 1, 2019 September 13, 2019 September 27, 2019 0.34

Second Quarter May 1, 2019 June 14, 2019 June 28, 2019 0.34

Fourth Quarter October 28, 2020 December 16, 2020 December 30, 2020 $ 0.30

Third Quarter July 29, 2020 September 16, 2020 September 30, 2020 0.30

Second Quarter April 29, 2020 June 16, 2020 June 30, 2020 0.30

First Quarter February 19, 2020 March 13, 2020 March 27, 2020 0.34

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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.

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.

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The Administrator cannot recoup any expenses that the Administrator has previously waived.

For the three and nine months ended September 30, 2020 approximately $0.6 million and $2.0 million, respectively, of indirect administrative expenses were included in administrative expenses, of which approximately $0.6 million and $0.9 million, respectively, were waived by the Administrator.

As of September 30, 2020, approximately $0.4 million of indirect administrative expenses were included in payable to affiliates.

For the three and nine months ended September 30, 2020, the reimbursement to the Administrator represented approximately 0.00% and 0.04%, respectively, of our gross assets.

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".

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On March 30, 2020, we entered into an unsecured revolving credit facility 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 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.

Refer to Borrowings for discussion of the Unsecured Management Company Revolver.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis