New Mountain Finance Corporation (NYSE:NMFC) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01.
On May 4, 2021, New Mountain Finance Corporation (the “Company”) and New Mountain Finance Advisers BDC, L.L.C. (the “Adviser”), the Company’s registered investment adviser, entered into a Fee Waiver Agreement (the “Fee Wavier Agreement”).
to the Fee Waiver Agreement, the Adviser agreed to voluntarily reduce the base management fees payable to the Adviser by the Company under the Investment Advisory and Management Agreement (the “Investment Management Agreement”), dated May 8, 2014, by and between the Company and the Adviser. Effective as of and for the quarter ended March 31, 2021 (the “Effective Date”) through the quarter ending December 31, 2022 (the “Termination Date”), the Adviser agreed to calculate the base management fee as set forth herein (defined below as the “Reduced Base Management Fee”), and to waive such portion of the base management fee payable under the Investment Management Agreement that is in excess of the Reduced Base Management Fee.
to the Investment Management Agreement, the Adviser, for its services to the Company, has been entitled to receive a base management fee from the Company calculated at an annual rate of 1.75% of the Company’s gross assets, as presented in the Company’s consolidated financial statements prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”), less (i) the outstanding indebtedness under the Amended and Restated Loan and Security Agreement by and among New Mountain Finance SPV Funding, L.L.C. as the borrower, Wells Fargo Securities, LLC, as the Administrative Agent, and Wells Fargo Bank, National Association, as the Collateral Custodian, as such document may be amended from time to time, and (ii) cash and cash equivalents (“Fee Earning Assets”). The base management fee is payable quarterly in arrears, and is calculated based on the average value of the Company’s Fee Earning Assets at the end of each of the two most recently completed calendar quarters, and appropriately adjusted on a pro rata basis for any equity capital raised or repurchased during the current calendar quarter. Base management fees for any partial month or quarter will be appropriately pro-rated.
Under the Fee Waiver Agreement, as of the Effective Date and through the Termination Date, the base management fee will be calculated at an annual rate of 1.25% of the Company’s gross assets, as presented in the Company’s consolidated financial statements prepared in conformity with GAAP (the “Reduced Base Management Fee”). The Reduced Base Management Fee will be payable quarterly in arrears, and will be calculated based on the average value of the Company’s gross assets at the end of each of the two most recently completed calendar quarters, and appropriately adjusted on a pro rata basis for any equity capital raised or repurchased during the current calendar quarter.
For the avoidance of doubt, the purpose of this waiver agreement is to reduce the base management fees payable to the Adviser by the Company for the quarter ended March 31, 2021 through the quarter ending December 31, 2022. In order to ensure that the Reduced Base Management Fee is less than the Base Management Fee that would otherwise be payable under the Investment Management Agreement, the Adviser will, for each quarterly period during the term of the Fee Wavier Agreement, calculate the Reduced Base Management Fee and the Base Management Fee under the terms of the Investment Management Agreement. 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 Adviser shall only be entitled to the lesser of those two amounts.
The description above is qualified in its entirety by reference to the copy of the Fee Waiver Agreement, which is filed as Exhibit 10.1 to this current report on Form 8-K and is incorporated herein by reference thereto.
| (a) | Not applicable. |
| (b) | Not applicable. |
| (c) | Not applicable. |
| (d) | Exhibits. |
Exhibit No.
| 10.1 | Fee Wavier Agreement by and between New Mountain Finance Corporation and New Mountain Finance Advisers BDC, L.L.C. |
New Mountain Finance Corp Exhibit
EX-10.1 2 tm2115149d1_exe10-1.htm EXHIBIT 10.1 Exhibit 10.1 New Mountain Finance Advisers BDC,…
To view the full exhibit click here
About New Mountain Finance Corporation (NYSE:NMFC)
New Mountain Finance Corporation is a closed-end, non-diversified management investment company. The Company’s investment objective is to generate current income and capital appreciation through the sourcing and origination of debt securities at all levels of the capital structure, including first and second lien debt, notes, bonds and mezzanine securities. Its investments may also include equity interests, such as preferred stock, common stock, warrants or options received in connection with its debt investments, or may include a direct investment in the equity of private companies. It makes investments through both primary originations and open-market secondary purchases. Its portfolio includes investments in various sectors, such as software, business services, education, distribution and logistics, federal services, consumer services, healthcare services, media and healthcare products. New Mountain Finance Advisers BDC, L.L.C. is the investment advisor of the Company.
