Horizon Technology Finance Corp

The Company is asking Stockholders to approve the New Investment Management Agreement between the Company and the Adviser, pursuant to which the Adviser will continue to serve as the Company’s investment adviser following the Adviser Change in Control.

The Adviser has advised the Board that Monroe has entered into the Transaction Agreement pursuant to which the Acquiror, an affiliate of Wendel, will acquire a 75% equity interest in Monroe (and indirectly, in the Adviser), which shall constitute a change in control of the Adviser. The consummation of the Adviser Change in Control will result in an assignment and immediate termination of the Current Investment Management Agreement, in accordance with the requirements of the 1940 Act. Although the ownership of the Adviser will change in connection with the consummation of the Adviser Change in Control, it is important to note that management of the Adviser is not expected to change in connection with the Adviser Change in Control, nor are the terms of the New Investment Management Agreement changing as compared to the terms of the Current Investment Management Agreement.

It is anticipated that all investment professionals of the Adviser currently providing investment advisory services to the Company, as well as the members of the Adviser’s investment committee, will continue to provide investment advisory services to the Company. The Adviser expects that its investment process will remain substantially the same following the Adviser Change in Control.

The Current Investment Management Agreement, as required by Section 15 of the 1940 Act, provides for its automatic termination in the event of its “assignment” (as defined in the 1940 Act). The consummation of the Adviser Change in Control will result in an assignment of the Current Investment Management Agreement and therefore cause the automatic termination of the Current Investment Management Agreement. Contingent upon Stockholder approval of the New Investment Management Agreement and the consummation of the Adviser Change in Control, the Adviser will enter into a new investment management agreement with the Company in order to continue to serve as investment adviser to the Company. The consummation of the Adviser Change in Control is subject to certain terms and conditions, including, among others, approval of the New Investment Management Agreement by the Company’s Stockholders, to take effect immediately after the closing of the Adviser Change in Control, and the receipt of required regulatory and other approvals. The proposed Adviser Change in Control is expected to close during the first quarter of 2025.

Wendel is a publicly-traded French corporation, a Euronext Paris Stock Exchange-listed company, and one of Europe’s leading investment companies in terms of size, with $11.0 billion in gross assets as of September 2024, three offices (Paris, Luxembourg and New York), and approximately 98 total employees. Wendel’s investment team is comprised of experienced professionals with varied backgrounds, including former consultants, company executives, investment bankers, public service managers, and operations managers. Wendel distinguishes itself among its peers through a combination of factors, including being a public company, having a stable family shareholder base (i.e., the Wendel family), its permanent capital holdings, and maintaining an investment portfolio that includes companies across a broad spectrum of geographies and market sectors. Wendel has a dual investment model based on two distinct and complementary businesses – principal investing and third-party asset management. Wendel has historically leveraged permanent capital to make principal investments in leading European and North American companies which are leaders in their fields and which today include ACAMS, Bureau Veritas, Crisis Prevention Institute, Globeducate, IHS Towers, Scalian, Stahl and Tarkett. In 2023, Wendel initiated a strategic shift into third-party asset management of private assets. In May 2024, Wendel completed the acquisition of a 51% stake in IK Partners, a leading mid-market European private equity firm with $13.9 billion in assets under management as of September 2024.