Issuer:
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New Mountain Finance Corporation (“NMFC”)
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Ticker / Exchange:
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NMFC / New York Stock Exchange (“NYSE”)
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Title of Securities:
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5.75% Convertible Notes due 2023 (the “Notes”)
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Aggregate Principal Amount Offered:
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$75,000,000 (or $86,250,000 if the underwriters fully exercise their option to purchase additional Notes)
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Offering Price:
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100.50% of principal amount, plus $17.8889 of accrued interest (per $1,000 principal amount of Notes) from February 15, 2019
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Annual Interest Rate:
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The Notes will bear interest at a rate equal to 5.75% per year
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NYSE Last Reported Sale Price on June 4, 2019:
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$14.15 per share of NMFC common stock
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Initial Conversion Price:
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Approximately $15.18 per share of NMFC common stock
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Initial Conversion Rate:
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65.8762 shares of NMFC common stock per $1,000 principal amount of Notes
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Redemption:
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NMFC may not redeem the Notes prior to May 15, 2023. On or after May 15, 2023, NMFC may redeem the Notes for cash, in whole or
from time to time in part, at its option at a redemption price equal to the sum of (i) 100% of the principal amount of the Notes to be redeemed, (ii) accrued and unpaid interest (including additional interest, if any) to, but excluding,
the redemption date and (iii) an amount equal to the present value of the interest that would accrue on the Notes from, and including, the redemption date until the maturity date, with such present value computed by us using a discount
rate equal to the yield to maturity of United States Treasury securities with three months of remaining maturity (as determined in a commercially reasonable manner by us prior to providing the applicable notice of redemption) plus 50
basis points.
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Interest Payment Dates:
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February 15 and August 15, commencing on August 15, 2019
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Maturity Date:
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August 15, 2023, unless earlier converted, redeemed or repurchased
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Joint-Lead Bookrunners:
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Morgan Stanley & Co. LLC and Wells Fargo Securities, LLC
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Trade Date:
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June 5, 2019
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Expected Settlement Date:
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June 7, 2019
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CUSIP:
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647551 AC4
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ISIN:
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US647551AC49
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Use of Proceeds:
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NMFC estimates that the net proceeds it will receive from the sale of $75,000,000 aggregate principal amount of Notes in this
offering will be approximately $74.6 million (or approximately $85.9 million if the underwriters fully exercise their overallotment option), after deducting the discounts, commissions and estimated expenses payable by NMFC, plus
$17.8889 of accrued interest (per $1,000 principal amount of Notes) from February 15, 2019.
NMFC intends to use the net proceeds from this offering to repay outstanding indebtedness under the NMFC Credit Facility and
then, to the extent any net proceeds remain, the Holdings Credit Facility and the DB Credit Facility. However, through re-borrowing under such credit facilities, NMFC intends to make new investments in accordance with its investment
objective and strategies described in the Preliminary Prospectus and use available capital for other general corporate purposes, including working capital requirements. The Notes have no restrictions related to the type and security of
assets in which NMFC might invest.
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Adjustment to Conversion Rate Upon a
Non-Stock Change of Control:
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The following table below sets forth the number of additional shares (as defined under “Description of the Notes—Adjustment to
Conversion Rate Upon a Non-Stock Change of Control” in the Preliminary Prospectus) to be received per $1,000 principal amount of Notes for each stock price and effective date set forth below:
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Share Price and Additional Shares
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Date
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$13.80
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$14.00
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$14.50
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$15.00
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$15.18
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$15.50
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$16.00
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$16.50
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$17.00
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$18.00
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August 20, 2018
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6.5875
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5.7679
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3.9441
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2.4467
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1.9881
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1.2774
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0.4513
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0.0673
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0.0018
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0.0000
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August 15, 2019
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6.5875
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5.6164
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3.7848
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2.3060
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1.8623
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1.1935
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0.4513
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0.0673
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0.0018
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0.0000
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August 15, 2020
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6.5875
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5.6164
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3.7848
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2.3060
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1.8623
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1.1935
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0.4513
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0.0673
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0.0018
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0.0000
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August 15, 2021
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6.5875
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5.6164
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3.7848
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2.3060
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1.8577
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1.1710
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0.4288
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0.0673
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0.0018
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0.0000
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August 15, 2022
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6.5875
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5.6164
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3.6628
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2.0613
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1.5988
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0.9303
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0.2738
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0.0364
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0.0000
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0.0000
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August 15, 2023
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6.5875
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5.5524
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3.0893
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0.7905
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0.0000
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0.0000
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0.0000
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0.0000
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0.0000
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0.0000
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●
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between two stock prices on the table or the effective date is between two dates on the table, the number of additional
shares will be determined by straight-line interpolation between the number of additional shares set forth for the higher and lower stock price amounts and the two dates, as applicable, based on a 360-day year;
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●
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in excess of $18.00 per share (subject to adjustment), no additional shares will be issued upon conversion; and
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less than $13.80 per share (subject to adjustment), no additional shares will be issued upon conversion.
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