October 15, 2019

Securities and Exchange Commission

Division of Investment Management

100 F Street, N.W.

Washington, D.C. 20549

Attn: Deborah O’Neal-Johnson and Kathy Churko

Dear Ms. O’Neal-Johnson and Ms. Churko:

On behalf of Portman Ridge Finance Corporation (“PTMN”), we are providing the following responses to comments received by telephone from the staff of the Securities and Exchange Commission (the “Commission”) on October 3, 2019 relating to PTMN’s Form N-14 filed with the Commission on September 6, 2019 (the “Registration Statement”). Please note that all page numbers in our responses are references to the page numbers of the Registration Statement.  All capitalized terms used but not defined in this letter have the meanings given to them in the Registration Statement.

PTMN confirms that, had the Merger occurred on June 30, 2019, more than 40% of the aggregate consideration received by OHAI Stockholders would have been comprised of PTMN Common Stock, and the Merger would have qualified as a reorganization.

As of June 30, 2019, PTMN had 37,356,061 shares outstanding and total net assets of $139,177,591. OHAI had net assets of $37,006,062. If the Merger had been consummated on June 30, 2019, PTMN would have issued 7,384,831 shares (after accounting for anticipated expenses of both parties related to the transaction). PTMN’s calculation of the pro forma ownership of the combined entity among existing PTMN Stockholders and OHAI Stockholders is below:

PTMN would have issued new shares of PTMN Common Stock equal to 19.769% of the number of issued and outstanding shares immediately prior to the Merger if it had occurred on June 30, 2019. Accordingly, PTMN would not have been required to increase the cash consideration payable to OHAI Stockholders above $8 million if the Merger had occurred on June 30, 2019. The relevant disclosure has been revised to reflect the correct number of shares that would have been issued on June 30, 2019.

The annualized expenses shown for PTMN are based on actual expenses for the quarter ended June 30, 2019, to account for the fact that PTMN transitioned from an internal management structure to an external management structure effective April 1, 2019. The actual expenses shown for PTMN exclude a non-recurring lease impairment charge, as disclosed in footnote 7 to the fees and expenses table. Similarly, the “actual” amounts presented in the table with respect to OHAI reflect the annualized actual amounts incurred by OHAI during the three months ended June 30, 2019, excluding costs related to the strategic alternative review process.  PTMN and OHAI excluded the non-recurring lease impairment charge and the costs related to the strategic alternative review process, respectively, because including these non-recurring charges would overstate their annualized expense estimates. Support for these calculations is attached hereto as Exhibit A. The table has been revised to indicate that PTMN is the acquiring fund and that OHAI is the target fund in connection with the proposed merger transaction.

OHAI’s incentive fee of 0.4% in the “Selected Consolidated Financial Data” table on page 68 represents the capital gains incentive fee accrual as of June 30, 2019, which OHAI is required under U.S. GAAP to accrue during the year but is determinable and payable in arrears as of the earlier of the end of each fiscal year or the termination of the investment advisory agreement. However, based on OHAI’s investment portfolio activity and preliminary portfolio valuations subsequent to June 30, 2019, OHAI estimates the capital gains incentive fee to be approximately $46,000, or 0.12% of net asset value.  As a result, we have revised the “Comparative Fees and Expenses” table in the Registration Statement to reflect the foregoing information.

The 16.32% total annual expenses shown for PTMN reflects PTMN’s second quarter actual expenses included in the Form 10-Q, less a $1.4 million lease impairment charge, on an annualized basis. Disclosure has been added to footnote 8 to the fees and expenses table to account for the exclusion of the lease impairment, similar to the disclosure in footnote 7.

PTMN has incorporated the requested revisions.

The termination of OHAI’s investment advisory agreement in connection with the Merger will not impact the calculation of the capital gains incentive fee payable thereunder (i.e., it will not result in the realization of gains or losses on any of OHAI’s individual investments for purposes thereof). However, such termination would re-establish the date to calculate the capital gains incentive fee amount to be paid to its investment adviser. Under the investment advisory agreement, the capital gains incentive fee is determined/calculated on the earlier of (i) December 31 of each year (which is OHAI’s fiscal year end) and (ii) upon termination of the investment advisory agreement.  As noted above, OHAI estimates that a capital gains incentive fee in the amount of $46,000 would be currently payable to its investment adviser at the next trigger/determination date set forth in its investment advisory agreement.  Because the Merger is expected to close prior to December 31, 2019, the trigger/determination date for the calculation of the capital gains income incentive fee to be paid to its investment adviser will likely be the date of the closing of the Merger.  As a result, OHAI has revised footnote 5 to the table entitled “Comparative Fees and Expenses Relating to the Merger” in the “Comparative Fees and Expenses” section to disclose the foregoing information.

PTMN confirms that the numbers related to PTMN in the “Example” are accurate. OHAI has revised the numbers related to OHAI in the “Example” for the reasons noted elsewhere herein. Support for these calculations is attached hereto as Exhibit C.

PTMN has incorporated the requested revisions.

The amounts for “investments, at fair value” in the PTMN Pro Forma Condensed Consolidated Statement of Financial Condition and capitalization table under “Portfolio and Investment Activity” in the Registration Statement do not include $27,443,091 of short-term investments. Those short-term investments are accounted for in the “Cash, cash equivalents and restricted cash” and “Other assets” line items. The Consolidated Schedule of Investments in PTMN’s Form 10-Q for the period ended June 30, 2019 includes short-term investments, and we note that the PTMN Pro Forma Condensed Consolidated Schedule of Investments included in the Registration Statement is identical in that respect.

It is likely that there will be unfunded commitments for the combined entity at closing of the Merger, and it is anticipated that the combined entity will have adequate coverage to satisfy all such unfunded commitments.

PTMN has incorporated the requested revisions.

PTMN confirms that all controlled or affiliated issuers are noted in the PTMN Pro Forma Condensed Consolidated Schedule of Investments.

PTMN has incorporated the requested revisions.

The Registration Statement has been revised to eliminate the inconsistency.

The Registration Statement has been revised to disclose the yield on OHAI’s U.S. Treasury Bill rates.

ClearChoice has debt in the form of a term loan and a revolver that are pari passu and both accrue interest at LIBOR+650bps.  A small amount of the term loan was tranched out to a third party lender on a first-out basis at a lower LIBOR spread.   The difference between 650bps and the lower spread on the first-out term loan is shared pro rata by the remaining term loan lenders and revolving credit lenders.  This residual interest when added to the stated rate of interest of 650bps results in a realized interest spread of approximately 680bps.

PTMN was one of the selected companies against which KBW compared OHAI’s market performance. As a result, we did not remove PTMN as a selected company under the “Selected Companies Analysis” but instead removed language which incorrectly gave the impression that KBW compared PTMN’s market performance to itself.

The Registration Statement has been revised to identify last-out tranches separately.

As requested, the proxy card was filed as Exhibit 17(a) to the amended Registration Statement and as an attachment to OHAI’s revised preliminary merger proxy statement filed concurrently herewith.  The proxy card includes a mechanism for OHAI stockholders to vote on the adjournment proposal.

PTMN has incorporated the requested revisions.

The Registration Statement has been revised accordingly.

PTMN has incorporated the requested revision.

PTMN has incorporated the requested revisions.

PTMN has incorporated the requested revisions.

PTMN and OHAI confirm that no termination fee is payable to either PTMN’s or OHAI’s investment adviser or an affiliate of the investment adviser.

PTMN has incorporated the requested revision.

We respectfully submit that the disclosure of PTMN’s contingent future obligation to initiate the open market stock repurchase program does not implicate Rule 102 under Regulation M, and is an important term of the Merger Agreement that should be disclosed in the Form N-14.

Rule 102(a) under Regulation M imposes the following restriction:

Unlawful Activity. In connection with a distribution of securities effected by or on behalf of an issuer or selling security holder, it shall be unlawful for such person, or any affiliated purchaser of such person, directly or indirectly, to bid for, purchase, or attempt to induce any person to bid for or purchase, a covered security during the applicable restricted period; Except That if an affiliated purchaser is a distribution participant, such affiliated purchaser may comply with § 242.101, rather than this section.

Rule 100 under Regulation M defines “restricted period” to mean “[i]n the case of a distribution involving a merger, acquisition, or exchange offer, the period beginning on the day proxy solicitation or offering materials are first disseminated to security holders, and ending upon the completion of the distribution.” The “completion of the distribution” in the context of a merger has been interpreted to coincide with the time that stockholders vote on the transaction.¹

We note that PTMN’s commitment to implement a repurchase program is a covenant in Section 6.20 of the Merger Agreement, and was publicly disclosed in advance of the filing of the preliminary Form N-14 and before the commencement of the applicable restricted period under Regulation M. The disclosure regarding the repurchase program in the Form N-14 is intended to inform investors of this provision of the Merger Agreement.

We believe the disclosure makes it clear that the repurchase program will not commence during the restricted period, as the commitment does not become binding until after the consummation of the Merger. Additionally, there can be no assurance as to when PTMN will be obligated to implement the repurchase program, if at all. Under the Merger Agreement, prior to PTMN implementing the repurchase program PTMN Common Stock must be trading at a price below 75% of its net asset value per share. If PTMN Common Stock does not trade below this threshold within one year of the Merger being consummated, PTMN is under no obligation to implement the repurchase program. If the discount threshold is met, PTMN retains significant flexibility to determine the timing and amount of repurchases, as the announcement of the repurchase program would commence a twelve-month period during which PTMN may determine to purchase up to $10 million of PTMN Common Stock in open market transactions. PTMN is not obligated to repurchase any minimum amount of PTMN Common Stock.

¹ See Frequently Asked Questions About Regulation M, https://www.sec.gov/interps/legal/mrslb9.htm.

Additionally, we believe it would be unreasonable to view the disclosure of the contingent obligation to initiate a stock repurchase program as an inducement for other persons to bid for or purchase PTMN Common Stock during the restricted period. As noted above, there is no guarantee that PTMN will be required to commence repurchases and PTMN is not obligated to repurchase any particular amount of its common stock.

For the reasons described above, the disclosure referenced by the Staff does not constitute a bid for, purchase, or attempt to induce any person to bid for or purchase PTMN Common Stock during the solicitation period leading up to OHAI’s Special Meeting, and therefore does not implicate Rule 102 under Regulation M.

PTMN has made the requested revision and notes that the requested disclosure is included in the section entitled “The Merger—Opinion of the Financial Advisor to the OHAI Special Committee.”

The Registration Statement has been revised to disclose the estimated $50,000 cost of the proxy solicitation.

_______________________

Please call me (202-636-5543) or Christopher Healey (202-636-5879) with any questions you may have regarding this filing or if you wish to discuss the above responses.

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Exhibit A

		PTMN
Sales Load			0.00	%
Offering Expenses			0.00	%
DRIP Expenses			0.00	%
Total			0.00	%
		Pro forma																								PTMN Actual
Base management fees			2.90	%																							2.95	%
Incentive fees			0.21	%																							0.00	%
Interest payments on borrowed funds			5.57	%																							5.70	%
Other expenses			3.71	%																							7.67	%
Acquired fund fees and expenses			0.0	%																							0.0	%
Total annual expenses			12.39	%																							16.31	%
Assumed investment balance		$	1,000
Pro forma Post Transaction no cap gains:
Assumed return			5.00	%
PTMN Total Expenses			12.39	%
Less: Incentive fees			-0.21	%
Total Expenses ex incentive fees			12.17	%
		Year 1				Year 2				Year 3				Year 4				Year 5				Year 6				Year 7				Year 8				Year 9				Year 10
Beginning balance			1,000				928				862				800				742				689				640				594				551				512
Income			50				46				43				40				37				34				32				30				28				26
Expenses			(122	)			(113	)			(105	)			(97	)			(90	)			(84	)			(78	)			(72	)			(67	)			(62	)
Ending balance			928				862				800				742				689				640				594				551				512				475
For table in N-14			122								340								527																				891
Pro forma Post Transaction All capital gains:
Assumed return			5.00	%
PTMN Total Expenses			12.39	%
Plus: Incentive fees			-0.21	%
Total Expenses ex incentive fees			12.17	%
Capt gains incentive fee rate (annual, not % of NAV)			17.5	%
		Year 1				Year 2				Year 3				Year 4				Year 5				Year 6				Year 7				Year 8				Year 9				Year 10
Beginning balance			1,000				920				846				777				715				657				604				556				511				470
Income			50				46				42				39				36				33				30				28				26				23
Expenses			(122	)			(112	)			(103	)			(95	)			(87	)			(80	)			(74	)			(68	)			(62	)			(57	)
Incentive fees			(9	)			(8	)			(7	)			(7	)			(6	)			(6	)			(5	)			(5	)			(4	)			(4	)
Ending balance			920				846				777				715				657				604				556				511				470				432
For table in N-14			130								361								556																				921
PTMN No capital gains:
Assumed return			5.00	%
PTMN Total Expenses			16.31	%
Less: Incentive fees			0.00	%
Total Expenses ex incentive fees			16.31	%
		Year 1				Year 2				Year 3				Year 4				Year 5				Year 6				Year 7				Year 8				Year 9				Year 10
Beginning balance			1,000				887				787				698				619				549				487				431				383				339
Income			50				44				39				35				31				27				24				22				19				17
Expenses			(163	)			(145	)			(128	)			(114	)			(101	)			(90	)			(79	)			(70	)			(62	)			(55	)
Ending balance			887				787				698				619				549				487				431				383				339				301
For table in N-14			163								436								651																				1,008
PTMN All capital gains:
Assumed return			5.00	%
PTMN Total Expenses			16.31	%
Plus: Incentive fees			0.00	%
Total Expenses ex incentive fees			16.31	%
Capt gains incentive fee rate (annual, not% of NAV)			17.5	%
		Year 1				Year 2				Year 3				Year 4				Year 5				Year 6				Year 7				Year 8				Year 9				Year 10
Beginning balance			1,000				878				771				677				595				522				458				403				353				310
Income			50				44				39				34				30				26				23				20				18				16
Expenses			(163	)			(143	)			(126	)			(110	)			(97	)			(85	)			(75	)			(66	)			(58	)			(51	)
Incentive fees			(9	)			(8	)			(7	)			(6	)			(5	)			(5	)			(4	)			(4	)			(3	)			(3	)
Ending balance			878				771				677				595				522				458				403				353				310				273
For table in N-14			172								455								674																				1,026

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