Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549


Form 10-Q


(Mark One)

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2022

OR

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE TRANSITION PERIOD FROM _____TO

COMMISSION FILE NUMBER: 814-00802


HORIZON TECHNOLOGY FINANCE CORPORATION

(Exact name of registrant as specified in its charter)


DELAWARE

27-2114934

(State or other jurisdiction of incorporation or organization)

(I.R.S. Employer Identification No.)

312 Farmington Avenue

Farmington, CT

06032

(Address of principal executive offices)

(Zip Code)

(860) 676-8654

(Registrant’s telephone number, including area code)


Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes No

The number of shares of the registrant’s common stock traded under the symbol “HRZN” on the Nasdaq Global Select Market, $0.001 par value per share, outstanding as of May 3, 2022 was 23,980,358.

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

    

Ticker symbol(s)

    

Name of each exchange on which registered

Common Stock, par value $0.001 per share

HRZN

The Nasdaq Stock Market LLC

4.875% Notes due 2026

HTFB

The New York Stock Exchange


Table of Contents

HORIZON TECHNOLOGY FINANCE CORPORATION

FORM 10-Q

TABLE OF CONTENTS

Page

PART I

Item 1

Consolidated Financial Statements.

3

Consolidated Statements of Assets and Liabilities as of March 31, 2022 (unaudited) and December 31, 2021

3

Consolidated Statements of Operations for the three months ended March 31, 2022 and 2021 (unaudited)

4

Consolidated Statements of Changes in Net Assets for the three months ended March 31, 2022 and 2021 (unaudited)

5

Consolidated Statements of Cash Flows for the three months ended March 31, 2022 and 2021 (unaudited)

6

Consolidated Schedules of Investments as of March 31, 2022 (unaudited) and December 31, 2021

7

Notes to the Consolidated Financial Statements (unaudited)

20

Item 2.

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

43

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

57

Item 4.

Controls and Procedures

58

PART II

58

Item 1.

Legal Proceedings

58

Item 1A.

Risk Factors

59

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

59

Item 3.

Defaults Upon Senior Securities

59

Item 4.

Mine Safety Disclosures

59

Item 5.

Other Information

59

Item 6.

Exhibits

59

Signatures

60

EX-31.1

EX-31.2

EX-32.1

EX-32.2

2


Table of Contents

PART I: FINANCIAL INFORMATION

Item 1. Consolidated Financial Statements

Horizon Technology Finance Corporation and Subsidiaries

Consolidated Statements of Assets and Liabilities

(Dollars in thousands, except share and per share data)

March 31, 

December 31, 

    

2022

    

2021

Assets

 

 

  

Non-affiliate investments at fair value (cost of $511,607 and $452,387, respectively)

$

515,009

$

458,075

Controlled affiliate investments at fair value (cost of $1,400 and $1,450, respectively) (Note 5)

 

 

Total investments at fair value (cost of $513,007 and $453,837, respectively) (Note 4)

 

515,009

 

458,075

Cash

 

12,452

 

38,054

Investments in money market funds

 

2,011

 

7,868

Restricted investments in money market funds

 

1,515

 

1,359

Interest receivable

 

8,305

 

6,154

Other assets

 

2,252

 

2,450

Total assets

$

541,544

$

513,960

Liabilities

 

  

 

  

Borrowings (Note 7)

$

250,501

$

257,613

Distributions payable

 

7,193

 

6,365

Base management fee payable (Note 3)

 

785

 

706

Incentive fee payable (Note 3)

 

1,424

 

2,015

Other accrued expenses

 

1,652

 

1,926

Total liabilities

 

261,555

 

268,625

Commitments and contingencies (Note 8)

 

  

 

  

Net assets

 

  

 

  

Preferred stock, par value $0.001 per share, 1,000,000 shares authorized, zero shares issued and outstanding as of March 31, 2022 and December 31, 2021

 

 

Common stock, par value $0.001 per share, 100,000,000 shares authorized, 24,144,602 and 21,384,925 shares issued and 23,977,137 and 21,217,460 shares outstanding as of March 31, 2022 and December 31, 2021, respectively

 

25

 

22

Paid-in capital in excess of par

 

339,688

 

301,359

Distributable earnings

 

(59,724)

 

(56,046)

Total net assets

 

279,989

 

245,335

Total liabilities and net assets

$

541,544

$

513,960

Net asset value per common share

$

11.68

$

11.56

See Notes to Consolidated Financial Statements

3


Table of Contents

Horizon Technology Finance Corporation and Subsidiaries

Consolidated Statements of Operations (Unaudited)

(Dollars in thousands, except share and per share data)

For the Three Months Ended

March 31, 

    

2022

    

2021

    

    

Investment income

 

  

 

  

 

 

Interest income on investments

 

  

 

  

 

 

Interest income on non-affiliate investments

$

13,853

$

12,490

 

Interest income on affiliate investments

 

 

172

 

Total interest income on investments

 

13,853

 

12,662

 

Fee income

 

 

  

 

Fee income on non-affiliate investments

 

351

 

541

 

Fee income on affiliate investments

 

 

12

 

Total fee income

 

351

 

553

 

Total investment income

 

14,204

 

13,215

 

Expenses

 

  

 

  

 

Interest expense

 

3,424

 

2,715

 

Base management fee (Note 3)

 

2,244

 

1,771

 

Performance based incentive fee (Note 3)

 

1,424

 

1,501

 

Administrative fee (Note 3)

 

362

 

289

 

Professional fees

 

577

 

509

 

General and administrative

 

344

 

365

 

Total expenses

 

8,375

 

7,150

 

Net investment income before excise tax

 

5,829

 

6,065

 

Provision for excise tax

 

100

 

62

 

Net investment income

 

5,729

 

6,003

 

Net realized and unrealized (loss) gain

 

  

 

  

 

Net realized gain (loss) on non-affiliate investments

 

30

 

(5,208)

 

Net realized gain (loss) on investments

 

30

 

(5,208)

 

Net unrealized (depreciation) appreciation on non-affiliate investments

 

(2,287)

 

6,263

 

Net unrealized depreciation on non-controlled affiliate investments

 

 

(1,039)

 

Net unrealized appreciation on controlled affiliate investments

 

50

 

 

Net unrealized (depreciation) appreciation on investments

 

(2,237)

 

5,224

 

Net realized and unrealized (loss) gain

 

(2,207)

 

16

 

Net increase in net assets resulting from operations

$

3,522

$

6,019

 

Net investment income per common share

$

0.26

$

0.31

 

Net increase in net assets resulting from operations per common share

$

0.16

$

0.31

 

Distributions declared per share

$

0.30

$

0.30

 

Weighted average shares outstanding

 

21,904,160

 

19,366,581

 

See Notes to Consolidated Financial Statements

4


Table of Contents

Horizon Technology Finance Corporation and Subsidiaries

Consolidated Statements of Changes in Net Assets (Unaudited)

(Dollars in thousands, except share data)

Paid-In Capital

Common Stock

in Excess of

Distributable

Total Net

    

Shares

    

Amount

    

Par

    

Earnings

    

Assets

Balance at December 31, 2020

 

19,286,356

$

19

$

271,287

(58,709)

$

212,597

Issuance of common stock, net of offering costs

366,140

1

4,876

4,877

Net increase in net assets resulting from operations, net of excise tax:

 

  

 

 

  

 

  

 

  

Net investment income, net of excise tax

 

 

 

 

6,003

 

6,003

Net realized loss on investments

 

 

 

 

(5,208)

 

(5,208)

Net unrealized appreciation on investments

 

 

 

 

5,224

 

5,224

Issuance of common stock under dividend reinvestment plan

 

5,319

 

 

76

 

 

76

Distributions declared

 

 

 

 

(5,898)

 

(5,898)

Balance at March 31, 2021

 

19,657,815

20

276,239

(58,588)

217,671

Balance at December 31, 2021

21,217,460

22

301,359

(56,046)

245,335

Issuance of common stock, net of offering costs

 

2,750,171

 

3

 

38,184

 

 

38,187

Net increase in net assets resulting from operations, net of excise tax:

 

  

 

  

 

  

 

  

 

  

Net investment income, net of excise tax

 

5,729

5,729

Net realized gain on investments

 

 

 

 

30

 

30

Net unrealized depreciation on investments

 

 

 

 

(2,237)

 

(2,237)

Issuance of common stock under dividend reinvestment plan

 

9,506

 

 

145

 

 

145

Distributions declared

 

 

 

 

(7,200)

 

(7,200)

Balance at March 31, 2022

 

23,977,137

$

25

$

339,688

$

(59,724)

$

279,989

See Notes to Consolidated Financial Statements

5


Table of Contents

Horizon Technology Finance Corporation and Subsidiaries

Consolidated Statements of Cash Flows (Unaudited)

(Dollars in thousands)

For the three months ended March 31, 

    

2022

    

2021

Cash flows from operating activities:

 

  

 

  

 

Net increase in net assets resulting from operations

$

3,522

$

6,019

Adjustments to reconcile net increase in net assets resulting from operations to net cash used in operating activities:

 

 

Amortization of debt issuance costs

 

336

 

236

Net realized (gain) loss on investments

 

(30)

 

5,208

Net unrealized depreciation (appreciation) on investments

 

2,237

 

(5,224)

Purchase of investments

 

(94,485)

 

(51,375)

Principal payments received on investments

 

14,145

 

24,132

Proceeds from sale of investments

21,280

873

Changes in assets and liabilities:

 

  

 

  

Increase in interest receivable

 

(866)

 

(368)

Increase in end-of-term payments

 

(1,285)

 

(817)

Decrease in unearned income

 

(81)

 

(603)

Decrease (increase) in other assets

 

652

 

(41)

(Decrease) increase in other accrued expenses

 

(274)

 

468

Increase in base management fee payable

 

79

 

37

(Decrease) increase in incentive fee payable

 

(591)

 

526

Net cash used in operating activities

 

(55,361)

 

(20,929)

Cash flows from financing activities:

 

  

 

  

Proceeds from issuance of 2026 Notes

57,500

Repayment of Asset-Backed Notes

(12,352)

Proceeds from issuance of common stock, net of offering costs

 

38,187

 

4,877

Advances on Credit Facilities

 

25,000

 

36,500

Repayment of Credit Facilities

 

(20,000)

 

(36,000)

Debt issuance costs

(550)

(1,886)

Distributions paid

 

(6,227)

 

(5,711)

Net cash provided by financing activities

 

24,058

 

55,280

Net (decrease) increase in cash, cash equivalents and restricted cash

 

(31,303)

 

34,351

Cash, cash equivalents and restricted cash:

 

  

 

  

Beginning of period

 

47,281

 

47,758

End of period

$

15,978

$

82,109

Supplemental disclosure of cash flow information:

 

  

 

  

 

Cash paid for interest

$

3,044

$

2,274

Supplemental non-cash investing and financing activities:

 

  

 

  

Warrant investments received and recorded as unearned income

$

1,174

$

679

Distributions payable

$

7,193

$

5,897

End-of-term payments receivable

$

6,522

$

4,710

Non-cash income

$

1,424

$

1,478

Three months ended March 31, 

    

2022

    

2021

    

Cash

$

12,452

$

70,386

Investments in money market funds

 

2,011

 

10,184

Restricted investments in money market funds

 

1,515

 

1,539

Total cash, cash equivalents and restricted cash

$

15,978

$

82,109

See Notes to Consolidated Financial Statements

6


Table of Contents

Horizon Technology Finance Corporation and Subsidiaries

Consolidated Schedule of Investments (Unaudited)

March 31, 2022

(Dollars in thousands)

    

    

    

Principal

    

Cost of

    

Fair

Portfolio Company (1)(3)

Sector

Type of Investment (4)(7)(9)(10)

    

Amount

    

Investments (6)

    

Value

Non-Affiliate Investments — 183.7% (8)

 

  

 

  

 

  

 

  

 

  

Non-Affiliate Debt Investments — 175.8% (8)

 

  

 

  

 

  

 

  

Non-Affiliate Debt Investments — Life Science — 75.2% (8)

 

  

 

  

 

  

 

  

Avalo Therapeutics, Inc. (2)(5)(12)

Biotechnology

Term Loan (9.75% cash (Prime + 6.25%; Floor 9.50%), 3.0% ETP, Due 1/1/25)

$

5,000

$

4,916

$

4,916

Term Loan (9.75% cash (Prime + 6.25%; Floor 9.50%), 3.0% ETP, Due 1/1/25)

5,000

4,916

4,916

Term Loan (9.75% cash (Prime + 6.25%; Floor 9.50%), 3.0% ETP, Due 1/1/25)

2,500

2,458

2,458

Term Loan (9.75% cash (Prime + 6.25%; Floor 9.50%), 3.0% ETP, Due 2/1/25)

5,000

4,914

4,914

Term Loan (9.75% cash (Prime + 6.25%; Floor 9.50%), 3.0% ETP, Due 2/1/25)

5,000

4,914

4,914

Term Loan (9.75% cash (Prime + 6.25%; Floor 9.50%), 3.0% ETP, Due 4/1/25)

2,500

2,454

2,454

Term Loan (9.75% cash (Prime + 6.25%; Floor 9.50%), 3.0% ETP, Due 4/1/25)

2,500

2,454

2,454

Castle Creek Biosciences, Inc.(2)(12)

Biotechnology

Term Loan (9.55% cash (Prime + 6.05%; Floor 9.30%), 5.00% ETP, Due 3/1/24)

5,000

4,962

4,962

Term Loan (9.55% cash (Prime + 6.05%; Floor 9.30%), 5.00% ETP, Due 3/1/24)

5,000

4,962

4,962

Term Loan (9.55% cash (Prime + 6.05%; Floor 9.30%), 5.00% ETP, Due 3/1/24)

5,000

4,962

4,962

Term Loan (9.55% cash (Prime + 6.05%; Floor 9.30%), 5.00% ETP, Due 3/1/24)

5,000

4,962

4,962

Term Loan (9.55% cash (Prime + 6.05%; Floor 9.30%), 5.00% ETP, Due 2/1/26)

2,500

2,473

2,473

Term Loan (9.55% cash (Prime + 6.05%; Floor 9.30%), 5.00% ETP, Due 2/1/26)

2,500

2,473

2,473

Emalex Biosciences, Inc. (2)(12)

Biotechnology

Term Loan (9.75% cash (Libor + 7.90%; Floor 9.75%), 5.00% ETP, Due 6/1/24)

2,500

2,423

2,423

Term Loan (9.75% cash (Libor + 7.90%; Floor 9.75%), 5.00% ETP, Due 6/1/24)

2,500

2,475

2,475

Term Loan (9.75% cash (Libor + 7.90%; Floor 9.75%), 5.00% ETP, Due 11/1/25)

5,000

4,902

4,902

F-Star Therapeutics, Inc. (2)(5)(12)

Biotechnology

Term Loan (9.75% cash (Prime + 6.25%; Floor 9.50%), 4.00% ETP, Due 4/1/25)

2,500

2,468

2,468

Term Loan (9.75% cash (Prime + 6.25%; Floor 9.50%), 4.00% ETP, Due 7/1/25)

2,500

2,465

2,465

Greenlight Biosciences, Inc. (2)(5)(12)

Biotechnology

Term Loan (9.25% cash (Prime + 6.25%; Floor 9.00%), 3.00% ETP, Due 7/1/25)

5,000

4,568

4,568

Term Loan (9.25% cash (Prime + 6.25%; Floor 9.00%), 3.00% ETP, Due 7/1/25)

2,500

2,409

2,409

IMV Inc. (2)(5)(12)

Biotechnology

Term Loan (9.25% cash (Prime + 6.25%; Floor 9.00%), 5.00% ETP, Due 7/1/25)

5,000

4,804

4,804

Term Loan (9.25% cash (Prime + 6.25%; Floor 9.00%), 5.00% ETP, Due 7/1/25)

2,500

2,465

2,465

LogicBio, Inc.(2)(5)(12)

Biotechnology

Term Loan (8.75% cash (Libor + 6.25%; Floor 8.75%), 4.50% ETP, Due 6/1/24)

3,611

3,596

3,596

Provivi, Inc. (2)(12)

Biotechnology

Term Loan (9.50% cash (Libor + 8.50%; Floor 9.50%), 5.50% ETP, Due 12/1/24)

5,000

4,940

4,940

Term Loan (9.50% cash (Libor + 8.50%; Floor 9.50%), 5.50% ETP, Due 12/1/24)

5,000

4,940

4,940

Term Loan (9.50% cash (Libor + 8.50%; Floor 9.50%), 5.50% ETP, Due 12/1/24)

2,500

2,445

2,445

Term Loan (9.50% cash (Libor + 8.50%; Floor 9.50%), 5.50% ETP, Due 12/1/24)

2,500

2,445

2,445

Term Loan (9.50% cash (Libor + 8.50%; Floor 9.50%), 5.50% ETP, Due 12/1/24)

2,500

2,436

2,436

Term Loan (9.50% cash (Libor + 8.50%; Floor 9.50%), 5.50% ETP, Due 12/1/24)

2,500

2,436

2,436

Stealth Biotherapeutics Inc. (2)(5)(12)

Biotechnology

Term Loan (9.00% cash (Prime + 5.50%; Floor 8.75%), 6.0% ETP, Due 10/1/25)

5,000

4,639

4,639

Term Loan (9.00% cash (Prime + 5.50%; Floor 8.75%), 6.0% ETP, Due 10/1/25)

2,500

2,445

2,445

Aerobiotix, LLC (2)(12)

Medical Device

Term Loan (9.75% cash (Prime + 6.25%; Floor 8.75%), 6.0% ETP, Due 4/1/26)

2,500

2,451

2,451

Term Loan (9.75% cash (Prime + 6.25%; Floor 8.75%), 6.0% ETP, Due 4/1/26)

2,500

2,451

2,451

Canary Medical Inc. (2)(12)

Medical Device

Term Loan (9.25% cash (Prime + 5.75%; Floor 9.00%), 7.00% ETP, Due 11/1/24)

2,500

2,431

2,431

Term Loan (9.25% cash (Prime + 5.75%; Floor 9.00%), 7.00% ETP, Due 11/1/24)

2,500

2,480

2,480

Term Loan (9.25% cash (Prime + 5.75%; Floor 9.00%), 7.00% ETP, Due 11/1/24)

2,500

2,452

2,452

See Notes to Consolidated Financial Statements

7


Table of Contents

Horizon Technology Finance Corporation and Subsidiaries

Consolidated Schedule of Investments (Unaudited)

March 31, 2022

(Dollars in thousands)

    

    

    

Principal

    

Cost of

    

Fair

Portfolio Company (1)(3)

Sector

Type of Investment (4)(7)(9)(10)

    

Amount

Investments (6)

Value

Ceribell, Inc. (2)(12)

Medical Device

Term Loan (8.25% cash (Libor + 6.70%; Floor 8.25%), 5.50% ETP, Due 10/1/24)

5,000

4,921

4,921

Term Loan (8.25% cash (Libor + 6.70%; Floor 8.25%), 5.50% ETP, Due 10/1/24)

5,000

4,961

4,961

Term Loan (8.50% cash (Prime + 5.50%; Floor 8.25%), 5.50% ETP, Due 10/1/24)

2,500

2,469

2,469

Term Loan (8.50% cash (Prime + 5.50%; Floor 8.25%), 5.50% ETP, Due 10/1/24)

2,500

2,469

2,469

Cognoa, Inc. (2)(12)

Medical Device

Term Loan (9.00% cash (Prime + 5.50%; Floor 8.75%), 6.0% ETP, Due 8/1/26)

5,000

4,908

4,908

Term Loan (9.00% cash (Prime + 5.50%; Floor 8.75%), 6.0% ETP, Due 8/1/26)

2,500

2,278

2,278

Conventus Orthopaedics, Inc. (2)(12)

 

Medical Device

 

Term Loan (9.25% cash (Libor + 8.00%; Floor 9.25%), 10.36% ETP, Due 7/1/25)

 

3,959

 

3,882

 

3,618

 

 

Term Loan (9.25% cash (Libor + 8.00%; Floor 9.25%), 10.36% ETP, Due 7/1/25)

 

3,959

 

3,882

3,618

Corinth Medtech, Inc. (2)(12)

Medical Device

Term Loan (8.75% cash (Prime + 5.25%; Floor 8.50%), 20.00% ETP, Due 4/1/22)

2,500

2,500

2,500

Term Loan (8.75% cash (Prime + 5.25%; Floor 8.50%), 20.00% ETP, Due 4/1/22)

2,500

2,500

2,500

CSA Medical, Inc. (2)(12)

 

Medical Device

 

Term Loan (10.00% cash (Libor + 8.20%; Floor 10.00%), 5.00% ETP, Due 1/1/24)

 

2,750

 

2,723

 

2,723

Term Loan (10.00% cash (Libor + 8.20%; Floor 10.00%), 5.00% ETP, Due 1/1/24)

183

182

182

Term Loan (10.00% cash (Libor + 8.20%; Floor 10.00%), 5.00% ETP, Due 3/1/24)

3,200

3,173

3,173

Embody, Inc. (2)(12)

Medical Device

Term Loan (10.00% cash (Prime + 6.50%; Floor 9.75%), 28.00% ETP, Due 8/1/26)

2,500

2,458

2,458

InfoBionic, Inc. (2)(12)

Medical Device

Term Loan (9.75% cash (Prime + 6.25%; Floor 9.50%), 4.00% ETP, Due 10/1/24)

3,500

3,406

3,406

Term Loan (9.75% cash (Prime + 6.25%; Floor 9.50%), 4.00% ETP, Due 6/1/25)

1,000

966

966

MacuLogix, Inc. (2)(12)(14)

 

Medical Device

 

Term Loan (10.08% cash (Libor + 7.68%; Floor 10.08%), 6.00% ETP, Due 9/1/23)

 

7,500

 

7,389

 

3,322

 

 

Term Loan (10.08% cash (Libor + 7.68%; Floor 10.08%), 6.00% ETP, Due 9/1/23)

 

4,050

 

3,990

1,794

Term Loan (14.00% cash, Due 4/29/22)

188

188

83

Term Loan (14.00% cash, Due 4/29/22)

250

300

300

Magnolia Medical Technologies, Inc. (2)(12)

Medical Device

Term Loan (10.00% cash (Prime + 5.00%; Floor 9.75%), 4.00% ETP, Due 3/1/25)

5,000

4,956

4,956

Term Loan (10.00% cash (Prime + 5.00%; Floor 9.75%), 4.00% ETP, Due 3/1/25)

5,000

4,956

4,956

Term Loan (10.00% cash (Prime + 5.00%; Floor 9.75%), 4.00% ETP, Due 3/1/25)

5,000

4,948

4,948

Term Loan (10.00% cash (Prime + 5.00%; Floor 9.75%), 4.00% ETP, Due 3/1/25)

5,000

4,948

4,948

Sonex Health, Inc. (2)(12)

Medical Device

Term Loan (9.50% cash (Prime + 6.00%; Floor 9.25%), 5.00% ETP, Due 6/1/25)

2,500

2,382

2,382

Term Loan (9.50% cash (Prime + 6.00%; Floor 9.25%), 5.00% ETP, Due 6/1/25)

2,500

2,471

2,471

Term Loan (9.50% cash (Prime + 6.00%; Floor 9.25%), 5.00% ETP, Due 6/1/25)

2,500

2,471

2,471

Spineology, Inc. (2)(12)

Medical Device

Term Loan (10.50% cash (Prime + 7.00%; Floor 10.25%), 1.00% ETP, Due 10/1/25)

5,000

4,956

4,956

Term Loan (10.50% cash (Prime + 7.00%; Floor 10.25%), 1.00% ETP, Due 4/1/26)

2,500

2,450

2,450

Total Non-Affiliate Debt Investments — Life Science

 

  

 

217,469

 

210,573

Non-Affiliate Debt Investments — Sustainability — 20.9% (8)

Dream Holdings, Inc. (2)(12)

Other Sustainability

Term Loan (10.00% cash (Prime + 6.75%; Floor 10.00%), 3.00% ETP, Due 4/1/26)

3,750

3,682

3,682

Term Loan (10.00% cash (Prime + 6.75%; Floor 10.00%), 3.00% ETP, Due 4/1/26)

3,750

3,682

3,682

Nexii Building Solutions, Inc. (2)(12)

Other Sustainability

Term Loan (10.50% cash (Prime + 7.00%; Floor 10.25%), 2.50% ETP, Due 9/1/25)

7,500

7,334

7,334

Term Loan (10.50% cash (Prime + 7.00%; Floor 10.25%), 2.50% ETP, Due 9/1/25)

7,500

7,334

7,334

Term Loan (10.50% cash (Prime + 7.00%; Floor 10.25%), 2.50% ETP, Due 9/1/25)

7,500

7,334

7,334

Soli Organic, Inc. (2)(12)

Other Sustainability

Term Loan (10.25% cash (Prime + 6.75%; Floor 10.00%), 2.75% ETP, Due 4/1/26)

5,000

4,610

4,610

Term Loan (10.25% cash (Prime + 6.75%; Floor 10.00%), 2.75% ETP, Due 4/1/26)

2,500

2,451

2,451

Temperpack Technologies, Inc. (2)(12)

Other Sustainability

Term Loan (10.25% cash (Prime + 6.75%; Floor 10.00%), 2.50% ETP, Due 6/1/25)

3,750

3,706

3,706

Term Loan (10.25% cash (Prime + 6.75%; Floor 10.00%), 2.50% ETP, Due 6/1/25)

3,750

3,706

3,706

See Notes to Consolidated Financial Statements

8


Table of Contents

Horizon Technology Finance Corporation and Subsidiaries

Consolidated Schedule of Investments (Unaudited)

March 31, 2022

(Dollars in thousands)

    

    

    

Principal

    

Cost of

    

Fair

Portfolio Company (1)(3)

Sector

Type of Investment (4)(7)(9)(10)

    

Amount

Investments (6)

Value

Term Loan (10.25% cash (Prime + 6.75%; Floor 10.00%), 2.50% ETP, Due 10/1/25)

7,500

7,403

7,403

Term Loan (10.25% cash (Prime + 6.75%; Floor 10.00%), 2.50% ETP, Due 10/1/25)

3,750

3,702

3,702

Term Loan (10.25% cash (Prime + 6.75%; Floor 10.00%), 2.50% ETP, Due 10/1/25)

3,750

3,702

3,702

Total Non-Affiliate Debt Investments — Sustainability

58,646

58,646

Non-Affiliate Debt Investments — Technology — 73.5% (8)

Axiom Space, Inc. (2)(12)

Communications

Term Loan (9.50% cash (Prime + 6.00%; Floor 9.25%), 2.50% ETP, Due 6/1/26)

7,500

7,446

7,446

Term Loan (9.50% cash (Prime + 6.00%; Floor 9.25%), 2.50% ETP, Due 6/1/26)

7,500

7,446

7,446

Term Loan (9.50% cash (Prime + 6.00%; Floor 9.25%), 2.50% ETP, Due 6/1/26)

7,500

7,446

7,446

Convertible Note (3.00%, Due 7/1/23)

250

250

250

Alula Holdings, Inc. (2)(12)

Consumer-related Technologies

Term Loan (10.25% cash (Prime + 6.75%; Floor 10.00%), 3.00% ETP, Due 1/1/25)

5,000

4,953

4,953

Term Loan (10.25% cash (Prime + 6.75%; Floor 10.00%), 3.00% ETP, Due 1/1/25)

5,000

4,953

4,953

Term Loan (10.25% cash (Prime + 6.75%; Floor 10.00%), 3.00% ETP, Due 1/1/25)

3,000

2,972

2,972

Term Loan (10.25% cash (Prime + 6.75%; Floor 10.00%), 3.00% ETP, Due 12/1/25)

1,000

970

970

Term Loan (10.25% cash (Prime + 6.75%; Floor 10.00%), 3.00% ETP, Due 2/1/26)

1,000

969

969

Better Place Forests Co. (2)(12)

Consumer-related Technologies

Term Loan (9.75% cash (Prime + 6.25%; Floor 9.50%), 1.85% ETP, Due 7/1/25)

5,000

4,935

4,935

Term Loan (9.75% cash (Prime + 6.25%; Floor 9.50%), 1.85% ETP, Due 10/1/25)

2,500

2,468

2,468

CAMP NYC, Inc. (2)(12)

Consumer-related Technologies

Term Loan (10.75% cash (Prime + 7.25%; Floor 10.50%), 3.00% ETP, Due 5/1/26)

3,500

3,452

3,452

Clara Foods Co. (2)(12)

Consumer-related Technologies

Term Loan (9.25% cash (Prime + 5.75%; Floor 9.00%), 5.50% ETP, Due 8/1/25)

2,500

2,477

2,477

Term Loan (9.25% cash (Prime + 5.75%; Floor 9.00%), 5.50% ETP, Due 8/1/25)

2,500

2,477

2,477

Interior Define, Inc. (2)(12)

Consumer-related Technologies

Term Loan (10.00% cash (Prime + 6.50%; Floor 9.75%), 4.00% ETP, Due 1/1/26

6,500

6,403

5,896

Term Loan (10.00% cash (Prime + 6.50%; Floor 9.75%), 4.00% ETP, Due 1/1/26

6,000

5,781

5,441

Lyrical Foods, Inc. (2)(12)

Consumer-related Technologies

Term Loan (10.25% cash (Prime + 6.75%; Floor 10.00%), 9.75% ETP, Due 1/1/24)

2,500

2,483

2,483

MyForest Foods Co. (2)(12)

Consumer-related Technologies

Term Loan (10.25% cash (Prime + 7.00%; Floor 10.00%), 3.00% ETP, Due 10/1/25)

5,000

4,931

4,931

Term Loan (10.25% cash (Prime + 7.00%; Floor 10.00%), 3.00% ETP, Due 10/1/25)

2,500

2,465

2,465

NextCar Holding Company, Inc. (2)(12)

Consumer-related Technologies

Term Loan (9.25% cash (Prime + 5.75%; Floor 9.00%), 10.10% ETP, Due 1/1/26)

5,000

4,939

4,939

Term Loan (9.25% cash (Prime + 5.75%; Floor 9.00%), 10.10% ETP, Due 1/1/26)

2,000

1,976

1,976

Term Loan (9.25% cash (Prime + 5.75%; Floor 9.00%), 10.10% ETP, Due 1/1/26)

2,500

2,468

2,468

Term Loan (9.25% cash (Prime + 5.75%; Floor 9.00%), 10.10% ETP, Due 1/1/26)

3,000

2,934

2,934

Primary Kids, Inc. (2)(12)

Consumer-related Technologies

Term Loan (10.75% cash (Prime + 7.25%; Floor 10.50%), 3.00% ETP, Due 3/1/25)

3,000

2,964

2,964

Term Loan (10.75% cash (Prime + 7.25%; Floor 10.50%), 3.00% ETP, Due 3/1/25)

3,000

2,964

2,964

Term Loan (10.75% cash (Prime + 7.25%; Floor 10.50%), 3.00% ETP, Due 9/1/25)

3,000

2,958

2,958

Unagi, Inc. (2)(12)

Consumer-related Technologies

Term Loan (11.25% cash (Prime + 7.75%; Floor 11.00%), Due 7/1/25)

2,500

2,467

2,467

Term Loan (11.25% cash (Prime + 7.75%; Floor 11.00%), Due 7/1/25)

1,250

1,233

1,233

Term Loan (11.25% cash (Prime + 7.75%; Floor 11.00%), Due 7/1/25)

1,250

1,229

1,229

Updater, Inc. (2)(12)

Consumer-related Technologies

Term Loan (12.00% cash (Prime + 5.75%; Floor 12.00%, Ceiling 14.00%),0.56% ETP, Due 12/20/24)

5,000

4,839

4,839

Term Loan (12.00% cash (Prime + 5.75%; Floor 12.00%, Ceiling 14.00%), 0.56% ETP, Due 12/20/24)

5,000

4,839

4,839

Term Loan (12.00% cash (Prime + 5.75%; Floor 12.00%, Ceiling 14.00%), 0.56% ETP, Due 12/20/24)

10,000

9,679

9,679

Liqid, Inc.(2)(12)

Networking

Term Loan (9.75% cash (Prime + 6.25%; Floor 9.50%), 4.00% ETP, Due 9/1/24)

5,000

4,777

4,777

See Notes to Consolidated Financial Statements

9


Table of Contents

Horizon Technology Finance Corporation and Subsidiaries

Consolidated Schedule of Investments (Unaudited)

March 31, 2022

(Dollars in thousands)

    

    

    

    

Cost of

    

Fair

Portfolio Company (1)(3)

Sector

Type of Investment (4)(7)(9)(10)

    

Investments (6)

Value

Term Loan (9.75% cash (Prime + 6.25%; Floor 9.50%), 4.00% ETP, Due 9/1/24)

5,000

4,932

4,932

Term Loan (9.75% cash (Prime + 6.25%; Floor 9.50%), 4.00% ETP, Due 9/1/24)

2,500

2,463

2,463

Term Loan (9.75% cash (Prime + 6.25%; Floor 9.50%), 4.00% ETP, Due 9/1/24)

2,500

2,463

2,463

Term Loan (9.75% cash (Prime + 6.25%; Floor 9.50%), 4.00% ETP, Due 9/1/24)

2,500

2,422

2,422

Branded Online, Inc. (2)(12)

Software

Term Loan (9.75% cash (Prime + 6.25%; Floor 9.50%), 6.00% ETP, Due 9/1/26)

5,000

4,734

4,734

Term Loan (9.75% cash (Prime + 6.25%; Floor 9.50%), 6.00% ETP, Due 11/1/26)

2,500

2,362

2,362

Term Loan (9.75% cash (Prime + 6.25%; Floor 9.50%), 0% ETP, Due 7/1/23)

5,000

5,000

5,000

BriteCore Holdings, Inc. (2)(12)

Software

Term Loan (10.25% cash (Prime + 6.75%; Floor 10.00%), 4.00% ETP, Due 10/1/24)

2,500

2,416

2,416

Term Loan (10.25% cash (Prime + 6.75%; Floor 10.00%), 4.00% ETP, Due 10/1/24)

2,500

2,483

2,483

Decisyon, Inc. (12)

 

Software

 

Term Loan (12.93% cash (Prime + 9.23%; Floor 12.68%), 50.43% ETP, Due 1/1/23)

3,379

3,379

3,379

Dropoff, Inc. (2)(12)

Software

Term Loan (10.00% cash (Prime + 6.50%; Floor 9.75%), 3.50% ETP, Due 4/1/26)

6,500

6,148

6,148

Term Loan (10.00% cash (Prime + 6.50%; Floor 9.75%), 3.50% ETP, Due 4/1/26)

6,000

5,826

5,826

Term Loan (10.00% cash (Prime + 6.50%; Floor 9.75%), 3.50% ETP, Due 8/1/26)

2,500

2,419

2,419

E La Carte, Inc. (2)(12)

Software

Term Loan (10.00% cash (Prime + 6.50%; Floor 9.75%), 4.00% ETP, Due 10/1/25)

3,000

2,940

2,940

Term Loan (10.00% cash (Prime + 6.50%; Floor 9.75%), 4.00% ETP, Due 10/1/25)

3,000

2,961

2,961

Term Loan (10.00% cash (Prime + 6.50%; Floor 9.75%), 4.00% ETP, Due 10/1/25)

1,500

1,480

1,480

Lemongrass Holdings, Inc. (2)(12)

Software

Term Loan (10.00% cash (Prime + 6.50%; Floor 9.75%), 2.50% ETP, Due 3/1/26)

5,000

4,930

4,930

Term Loan (10.00% cash (Prime + 6.50%; Floor 9.75%), 2.50% ETP, Due 3/1/26)

2,500

2,465

2,465

Lytics, Inc. (2)(12)

Software

Term Loan (10.00% cash (Prime + 6.00%; Floor 9.25%), 4.00% ETP, Due 7/1/25)

2,500

2,467

2,467

Reputation Institute, Inc. (2)(12)

Software

Term Loan (10.75% cash (Prime + 7.25%; Floor 10.50%), 3.00% ETP, Due 8/1/25)

5,000

4,912

4,912

Supply Network Visiblity Holdings LLC (2)(12)

Software

Term Loan (10.00% cash (Prime + 6.50%; Floor 9.75%), 4.00% ETP, Due 2/1/25)

3,500

3,462

3,462

Term Loan (10.00% cash (Prime + 6.50%; Floor 9.75%), 4.00% ETP, Due 2/1/25)

3,500

3,462

3,462

Term Loan (10.00% cash (Prime + 6.50%; Floor 9.75%), 4.00% ETP, Due 12/1/25)

2,500

2,465

2,465

Term Loan (10.00% cash (Prime + 6.50%; Floor 9.75%), 4.00% ETP, Due 12/1/25)

2,500

2,465

2,465

Total Non-Affiliate Debt Investments — Technology

 

 

 

206,599

205,752

Non-Affiliate Debt Investments — Healthcare information and services — 6.1% (8)

 

  

 

  

 

  

IDbyDNA, Inc.(2)(12)

Diagnostics

Term Loan (9.25% cash (Prime + 5.75%; Floor 9.00%), 5.50% ETP, Due 1/1/25)

5,000

4,941

4,941

Term Loan (9.25% cash (Prime + 5.75%; Floor 9.00%), 5.50% ETP, Due 1/1/25)

5,000

4,941

4,941

Term Loan (9.25% cash (Prime + 5.75%; Floor 9.00%), 5.50% ETP, Due 1/1/26)

2,500

2,447

2,447

Secure Transfusion Services, Inc. (2)(12)

Other Healthcare

Term Loan (9.25% cash (Prime + 5.75%; Floor 9.00%), 4.00% ETP, Due 10/1/25)

5,000

4,894

4,894

Total Non-Affiliate Debt Investments — Healthcare information and services

 

  

 

17,223

 

17,223

Total Non- Affiliate Debt Investments

 

 

  

 

499,937

 

492,194

Non-Affiliate Warrant Investments — 7.9% (8)

 

  

 

  

 

 

  

Non-Affiliate Warrants — Life Science — 1.1% (8)

 

  

 

  

 

  

 

  

Avalo Therapeutics, Inc. (2)(5)(12)

Biotechnology

317,306 Common Stock Warrants

310

Castle Creek Biosciences, Inc. (2)(12)

Biotechnology

3,885 Preferred Stock Warrants

151

18

Celsion Corporation (2)(5)(12)

 

Biotechnology

 

19,671 Common Stock Warrants

 

 

64

 

Corvium, Inc. (2)(12)

Biotechnology

661,956 Preferred Stock Warrants

54

Emalex Biosciences, Inc. (2)(12)

Biotechnology

92,002 Preferred Stock Warrants

139

178

F-Star Therapeutics, Inc. (2)(5)(12)

Biotechnology

21,120 Common Stock Warrants

35

Greenlight Biosciences, Inc. (2)(5)(12)

Biotechnology

71,292 Common Stock Warrants

368

368

IMV Inc. (2)(5)(12)

Biotechnology

284,090 Common Stock Warrants

64

107

LogicBio, Inc. (2)(5)(12)

Biotechnology

7,843 Common Stock Warrants

8

Mustang Bio, Inc. (2)(5)(12)

Biotechnology

252,161 Common Stock Warrants

147

Provivi, Inc. (2)(12)

Biotechnology

164,608 Preferred Stock Warrants

280

551

Rocket Pharmaceuticals Corporation (5)(12)

 

Biotechnology

 

7,051 Common Stock Warrants

 

 

17

 

2

See Notes to Consolidated Financial Statements

10


Table of Contents

Horizon Technology Finance Corporation and Subsidiaries

Consolidated Schedule of Investments (Unaudited)

March 31, 2022

(Dollars in thousands)

    

    

    

Principal

    

Cost of

    

Fair

Portfolio Company (1)(3)

Sector

Type of Investment (4)(7)(9)(10)

    

Amount

Investments (6)

Value

Stealth Biotherapeutics Inc. (2)(5)(12)

Biotechnology

795,455 Common Stock Warrants