Horizon Technology Finance Corp
For the period ended Jun 30, 2025. Filed Aug 7, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2025 · Filed Aug 7, 2025
HRZN$3.960.0%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-03-31; filed 2025-04-29.
0001437749-25-013547
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-06-30; filed 2025-08-07.
0001437749-25-025497
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 136 previous paragraphs and 160 current paragraphs.
83 unchanged; 45 reworded; 18 added; 6 removed; 2 previous and 14 current paragraphs rearranged.
Tables are not compared: 39 previous and 42 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (18)
Current report
Comparison of the six months ended June 30, 2025 and 2024
Current report
Investment income
Current report
Expenses
Current report
Base management fee expense decreased by $0.05 million, or 0.8%, to $6.1 million for the six months ended June 30, 2025 as compared to the six months ended June 30, 2024. Base management fee decreased primarily due to a decrease of $6.2 million, or 0.9%, in average gross assets less cash for the six months ended June 30, 2025 as compared to the six months ended June 30, 2024.
Current report
Administrative fee expense, professional fees and general and administrative expenses were $3.1 million and $3.0 million for the six months ended June 30, 2025 and 2024, respectively.
Current report
During the six months ended June 30, 2025, we realized net losses on investments totaling $9.3 million primarily due to the settlement of two of our debt investments. During the same period, we converted $12.5 million in outstanding principal of the 2031 Convertible Notes which resulted in a realized loss on extinguishment of debt of $0.8 million. During the six months ended June 30, 2024, we realized net gains on investments totaling $2.5 million primarily due to the exercise and conversion to equity of one of our warrant investments.
Current report
During the three months ended June 30, 2025, the Company did not sell shares of common stock under the 2023 Equity Distribution Agreement.
Current report
During the three months ended June 30, 2024, the Company sold 1,516,249 shares of common stock under the 2023 Equity Distribution Agreement. For the same period, the Company received total accumulated net proceeds of approximately $17.1 million, including $0.4 million of offering expenses, from these sales.
Current report
During the three and six months ended June 30, 2025, the holders of a portion of the 2031 Convertible Notes converted $12.5 million in outstanding principal of the 2031 Convertible Notes plus accrued but unpaid interest on such outstanding principal as of the conversion date into 1,621,503 shares of common stock at a weighted average conversion price of $7.79, together with cash in lieu of fractional shares, in accordance with noteholder conversion notice.
Current report
On July 1, 2025, we received proceeds of $2.7 million from the exercise of our warrants in Kate Farms, Inc.
Current report
On July 10, 2025, the holders of a portion of the 2031 Convertible Notes converted $3.75 million in outstanding principal of the 2031 Convertible Notes plus accrued but unpaid interest on such outstanding principal as of the conversion date into 496,256 shares of common stock at a conversion price of $7.57 per share, together with cash in lieu of fractional shares.
Current report
On July 18, 2025, Noodle Partners, Inc. (“Noodle”) prepaid its outstanding principal balance of $16.7 million on its venture loan, plus interest, end-of-term payment and prepayment penalty. We continue to hold warrants in Noodle.
Current report
On July 18, 2025, we received a principal paydown of $2.0 million on its venture loans to Tallac Therapeutics, Inc.
Current report
On July 29, 2025, Pivot Bio, Inc. (“Pivot Bio”) prepaid its outstanding principal balance of $10.0 million on its venture loan, plus interest, end-of-term payment and prepayment penalty. We continue to hold warrants in Pivot Bio.
Current report
On July 30, 2025, Native Microbials, Inc. (“Native Microbials”) prepaid its outstanding principal balance of $3.5 million on its venture loan, plus interest, end-of-term payment and prepayment penalty. We continue to hold warrants in Native Microbials.
Current report
On August 5, 2025, our Board authorized an increase in the maximum amount of our shares that can be repurchased on the open market or in privately negotiated purchases pursuant to Rule 10b-18 and other applicable provisions of the Securities Exchange Act of 1934, as amended from up to $5,000,000 of shares to up to $10,000,000 of shares, provided such purchases, in the aggregate, do not exceed two percent (2%) of the shares outstanding at the time of purchase and such shares are purchased only when the such shares are trading below 90% of our most recently disclosed net asset value per share.
Current report
On August 6, 2025, we purchased substantially all of the remaining assets of Powerscourt Investments XXV, LP for $22.5 million. We expect the purchase to be accretive to our net asset value when reported in our financial results for the third quarter.
Current report
On August 7, 2025, we entered into a certain Merger Agreement with Monroe Capital Corporation (“MRCC”; NASDAQ: MRCC) wherein MRCC will merge with and into us, subject to the receipt of, among other things, approval by our shareholders and by the shareholders of MRCC and the satisfaction of other closing conditions.
Removed paragraphs (6)
Previous report
On April 7, 2025, we funded a $5.0 million debt investment to a new portfolio company, SparkCharge, Inc.
Previous report
On April 9, 2025, OneNetwork, Inc. (d/b/a Finexio) prepaid its outstanding principal balance of $5.0 million on its venture loan, plus interest and end-of-term payment. In connection with the prepayment, all future commitments to make debt investments were terminated. We continue to hold warrants in OneNetwork, Inc. (d/b/a Finexio).
Previous report
On April 14, 2025, Kodiak Robotics, Inc. (“Kodiak”) and Ares Acquisition Corporation II (NYSE: AACT) (“AACT”), a publicly traded special purpose acquisition company, announced they entered into a definitive business combination agreement through which Kodiak will become a publicly-listed company. AACT is an affiliate of Ares Management Corporation (NYSE: ARES).
Previous report
On April 17, 2025, we funded a $0.3 million debt investment to an existing portfolio company, Better Place Forests Co.
Previous report
On April 17, 2025, we funded a $0.1 million debt investment to an existing portfolio company, Swift Health Systems, Inc.
Previous report
On April 28, 2025, the assignee of Western Alliance Bank’s loans to Soli Organic, Inc. (“Soli”) issued a “Blockage Notice” to us under a certain Subordination Agreement by and between Western Alliance Bank and us. The Blockage Notice stated that a default occurred under the assignee’s loan to Soli and that we were blocked from receiving any payments from Soli in connection with our debt investment in Soli until the assignee was repaid in full and that we were blocked from exercising any rights or remedies with respect thereto for a period of up to 180 days.
Reworded paragraphs (45)
Previous wording
We are a specialty finance company that lends to and invests in development-stage companies in the technology, life science, healthcare information and services and sustainability industries, which we refer to as our “Target Industries.” Our investment objective is to maximize our investment portfolio’s total return by generating current income from the debt investments we make and capital appreciation from the warrants we receive when making such debt investments. We are focused on making secured debt investments, which we refer to collectively as “Venture Loans,” to venture capital and private equity backed companies and publicly traded companies in our Target Industries, which we refer to as “Venture Lending.” Our debt investments are typically secured by first liens or first liens behind a secured revolving line of credit, or collectively “Senior Term Loans.” Some of our debt investments may also be subordinated to term debt provided by third parties. As of March 31, 2025, 87.5%, or $563.3 million, of our debt investment portfolio at fair value consisted of Senior Term Loans. Venture Lending is typically characterized by (1) the making of a secured debt investment after a venture capital or equity investment in the portfolio company has been made, which investment provides a source of cash to fund the portfolio company’s debt service obligations under the Venture Loan, (2) the senior priority of the Venture Loan which requires repayment of the Venture Loan prior to the equity investors realizing a return on their capital, (3) the amortization of the Venture Loan and (4) the lender’s receipt of warrants or other success fees with the making of the Venture Loan.
Current wording
We are a specialty finance company that lends to and invests in development-stage companies in the technology, life science, healthcare information and services and sustainability industries, which we refer to as our “Target Industries.” Our investment objective is to maximize our investment portfolio’s total return by generating current income from the debt investments we make and capital appreciation from the warrants we receive when making such debt investments. We are focused on making secured debt investments, which we refer to collectively as “Venture Loans,” to venture capital and private equity backed companies and publicly traded companies in our Target Industries, which we refer to as “Venture Lending.” Our debt investments are typically secured by first liens or first liens behind a secured revolving line of credit, or collectively “Senior Term Loans.” Some of our debt investments may also be subordinated to term debt provided by third parties. As of June 30, 2025, 93.9%, or $543.8 million, of our debt investment portfolio at fair value consisted of Senior Term Loans. Venture Lending is typically characterized by (1) the making of a secured debt investment after a venture capital or equity investment in the portfolio company has been made, which investment provides a source of cash to fund the portfolio company’s debt service obligations under the Venture Loan, (2) the senior priority of the Venture Loan which requires repayment of the Venture Loan prior to the equity investors realizing a return on their capital, (3) the amortization of the Venture Loan and (4) the lender’s receipt of warrants or other success fees with the making of the Venture Loan.
Previous wording
The following table shows total portfolio investment activity as of and for the three months ended March 31, 2025 and 2024:
Current wording
The following table shows total portfolio investment activity as of and for the three and six months ended June 30, 2025 and 2024:
Previous wording
The largest debt investments in our portfolio may vary from period to period as new debt investments are originated and existing debt investments are repaid. Our five largest debt investments at cost represented 21% and 22% of total debt investments outstanding as of March 31, 2025 and December 31, 2024, respectively. Our five largest debt investments at fair value represented 23% of total debt investments outstanding as of March 31, 2025 and December 31, 2024. No single debt investment at cost or fair value represented more than 10% of our total debt investments as of March 31, 2025 and December 31, 2024.
Current wording
The largest debt investments in our portfolio may vary from period to period as new debt investments are originated and existing debt investments are repaid. Our five largest debt investments at cost represented 23% and 22% of total debt investments outstanding as of June 30, 2025 and December 31, 2024, respectively. Our five largest debt investments at fair value represented 25% and 23% of total debt investments outstanding as of June 30, 2025 and December 31, 2024, respectively. No single debt investment at cost or fair value represented more than 10% of our total debt investments as of June 30, 2025 and December 31, 2024.
Previous wording
We use an internal credit rating system which rates each debt investment on a scale of 4 to 1, with 4 being the highest credit quality rating and 3 being the rating for a standard level of risk. A rating of 2 represents an increased level of risk and, while no loss is currently anticipated for a 2‑rated debt investment, there is potential for future loss of principal. A rating of 1 represents a deteriorating credit quality and a high degree of risk of loss of principal. Our internal credit rating system is not a national credit rating system. As of March 31, 2025 and December 31, 2024, our debt investments had a weighted average credit rating of 3.1. The following table shows the classification of our debt investment portfolio by credit rating as of March 31, 2025 and December 31, 2024:
Current wording
We use an internal credit rating system which rates each debt investment on a scale of 4 to 1, with 4 being the highest credit quality rating and 3 being the rating for a standard level of risk. A rating of 2 represents an increased level of risk and, while no loss is currently anticipated for a 2‑rated debt investment, there is potential for future loss of principal. A rating of 1 represents a deteriorating credit quality and a high degree of risk of loss of principal. Our internal credit rating system is not a national credit rating system. As of June 30, 2025 and December 31, 2024, our debt investments had a weighted average credit rating of 3.0 and 3.1, respectively. The following table shows the classification of our debt investment portfolio by credit rating as of June 30, 2025 and December 31, 2024:
Previous wording
As of March 31, 2025, there were seven debt investments with an internal credit rating of 1, with an aggregate cost of $66.7 million and an aggregate fair value of $15.5 million and there were five debt investments with an internal credit rating of 2, with an aggregate cost of $59.2 million and an aggregate fair value of $54.2 million. As of December 31, 2024, there were four debt investments with an internal credit rating of 1, with an aggregate cost of $44.8 million and an aggregate fair value of $10.5 million and there were seven debt investments with an internal credit rating of 2, with an aggregate cost of $53.3 million and an aggregate fair value of $48.8 million. The increase in the number of investments with internal credit ratings of 1 or 2 was primarily a result of the increase in the risk of loss of principal caused by the portfolio companies low cash positions and the difficult equity fundraising market and/or the underperformance of such portfolio companies.
Current wording
As of June 30, 2025, there were five debt investments with an internal credit rating of 1, with an aggregate cost of $74.8 million and an aggregate fair value of $26.9 million and there were three debt investments with an internal credit rating of 2, with an aggregate cost of $23.3 million and an aggregate fair value of $14.1 million. As of December 31, 2024, there were four debt investments with an internal credit rating of 1, with an aggregate cost of $44.8 million and an aggregate fair value of $10.5 million and there were seven debt investments with an internal credit rating of 2, with an aggregate cost of $53.3 million and an aggregate fair value of $48.8 million. The increase in the number of investments with internal credit ratings of 1 or 2 was primarily a result of the increase in the risk of loss of principal caused by the portfolio companies low cash positions and the difficult equity fundraising market and/or the underperformance of such portfolio companies.
Previous wording
Net (decrease) increase in net assets resulting from operations can vary substantially from period to period for various reasons, including, without limitation, the recognition of realized gains and losses and unrealized appreciation and depreciation on investments. As a result, quarterly comparisons of net increase in net assets resulting from operations may not be meaningful.
Current wording
Net decrease in net assets resulting from operations can vary substantially from period to period for various reasons, including, without limitation, the recognition of realized gains and losses and unrealized appreciation and depreciation on investments. As a result, quarterly comparisons of net increase in net assets resulting from operations may not be meaningful.
Previous wording
Total investment income decreased by $1.6 million, or 6.2%, to $24.5 million for the three months ended March 31, 2025 as compared to the three months ended March 31, 2024. For the three months ended March 31, 2025, total investment income consisted primarily of (1) $23.5 million in interest income from investments, which included $3.5 million in income from the accretion of origination fees and end of term payments and $0.3 million in PIK interest income and (2) $1.1 million in fee income.
Current wording
Total investment income decreased by $1.2 million, or 4.5%, to $24.5 million for the three months ended June 30, 2025 as compared to the three months ended June 30, 2024. For the three months ended June 30, 2025, total investment income consisted primarily of (1) $22.6 million in interest income from investments, which included $4.1 million in income from the accretion of origination fees and end of term payments and $0.2 million in PIK interest income and (2) $1.9 million in fee income.
Previous wording
Interest income on debt investments decreased by $2.4 million, or 9.3%, to $23.5 million, for the three months ended March 31, 2025 compared to the three months ended March 31, 2024. Interest income on debt investments for the three months ended March 31, 2025 as compared to the three months ended March 31, 2024 decreased primarily due to a decrease in the Prime Rate which is the base rate for most of our variable rate debt investments partially offset by an increase of $2.6 million, or 0.4%, in our average earning debt investments. The proportion of total investment income that resulted from the portion of ETPs not received in cash for the three months ended March 31, 2025 and 2024 was 4.6% and 6.8%, respectively. The decrease in the proportion of total investment income that resulted from the portion of ETPs not received in cash was a result of an increase in prepayments for the three months ended March 31, 2025 compared to the three months ended March 31, 2024.
Current wording
Interest income on debt investments decreased by $2.1 million, or 8.4%, to $22.6 million, for the three months ended June 30, 2025 compared to the three months ended June 30, 2024. Interest income on debt investments for the three months ended June 30, 2025 as compared to the three months ended June 30, 2024 decreased primarily due to a decrease in the Prime Rate which is the base rate for most of our variable rate debt investments. The proportion of total investment income that resulted from the portion of ETPs not received in cash for the three months ended June 30, 2025 and 2024 was 2.8% and 6.6%, respectively. The decrease in the proportion of total investment income that resulted from the portion of ETPs not received in cash was a result of an increase in prepayments for the three months ended June 30, 2025 compared to the three months ended June 30, 2024.
Previous wording
PIK interest income decreased by $1.1 million, or 79.4%, for the three months ended March 31, 2025 compared to the three months ended March 31, 2024. For the three months ended March 31, 2025 and 2024, 1.2% and 5.3%, respectively, of total investment income was attributable to non-cash PIK interest income. The decrease in PIK interest income as a percentage of total investment income was primarily due to a decrease in earning assets that contain a PIK feature for the three months ended March 31, 2025 compared to the three months ended March 31, 2024.
Current wording
PIK interest income decreased by $0.1 million, or 31.4%, to $0.2 for the three months ended June 30, 2025 compared to the three months ended June 30, 2024. For the three months ended June 30, 2025 and 2024, 1.0% and 1.4%, respectively, of total investment income was attributable to non-cash PIK interest income. The decrease in PIK interest income as a percentage of total investment income was primarily due to a decrease in earning assets that contain a PIK feature for the three months ended June 30, 2025 compared to the three months ended June 30, 2024.
Previous wording
Fee income, which includes success fee, other fee and prepayment fee income on debt investments, increased by $0.8 million, or 296.3%, to $1.1 million for the three months ended March 31, 2025 compared to the three months ended March 31, 2024 primarily due to a higher aggregate amount of principal prepayments for the three months ended March 31, 2025 compared to the three months ended March 31, 2024.
Current wording
Fee income, which includes success fee, other fee and prepayment fee income on debt investments, increased by $0.9 million, or 89.3%, to $1.9 million for the three months ended June 30, 2025 compared to the three months ended June 30, 2024 primarily due to a higher aggregate amount of principal prepayments for the three months ended June 30, 2025 compared to the three months ended June 30, 2024.
Previous wording
Investment income, consisting of interest income and fees on debt investments, can fluctuate significantly upon repayment of large debt investments. Interest income from the five largest debt investments at cost in the aggregate accounted for 24% and 16% of investment income for the three months ended March 31, 2025 and 2024, respectively. Interest income from the five largest debt investments at fair value in the aggregate accounted for 24% and 21% of investment income for the three months ended March 31, 2025 and 2024, respectively.
Current wording
Investment income, consisting of interest income and fees on debt investments, can fluctuate significantly upon repayment of large debt investments. Interest income from the five largest debt investments at cost in the aggregate accounted for 18% and 20% of investment income for the three months ended June 30, 2025 and 2024, respectively. Interest income from the five largest debt investments at fair value in the aggregate accounted for 22% and 24% of investment income for the three months ended June 30, 2025 and 2024, respectively.
Previous wording
Total expenses increased by $0.3 million, or 2.1%, to $13.4 million for the three months ended March 31, 2025 as compared to the three months ended March 31, 2024. Total expenses for each period consisted of interest expense, base management fee, incentive and administrative fees, professional fees and general and administrative expenses.
Current wording
Total expenses increased by $0.3 million, or 2.3%, to $12.7 million for the three months ended June 30, 2025 as compared to the three months ended June 30, 2024. Total expenses for each period consisted of interest expense, base management fee, incentive and administrative fees, professional fees and general and administrative expenses.
Previous wording
Interest expense increased by $0.5 million, or 6.4%, to $8.7 million for the three months ended March 31, 2025 as compared to the three months ended March 31, 2024. Interest expense, which includes the amortization of debt issuance costs, increased primarily due to an increase in average borrowings of $12.5 million, or 2.7%, for the three months ended March 31, 2025 as compared to the three months ended March 31, 2024 and an increase in our effective cost of debt for the three months ended March 31, 2025 as compared to the three months ended March 31, 2024.
Current wording
Interest expense increased by $0.3 million, or 3.3%, to $8.2 million for the three months ended June 30, 2025 as compared to the three months ended June 30, 2024. Interest expense, which includes the amortization of debt issuance costs, increased primarily due to an increase in our effective cost of debt for the three months ended June 30, 2025 as compared to the three months ended June 30, 2024 partially offset by a decrease in average borrowings for the three months ended June 30, 2025 of $4.3 million, or 1.0%, as compared to the three months ended June 30, 2024.
Previous wording
Base management fee expense increased by $0.02 million, or 0.6%, to $3.2 million for the three months ended March 31, 2025 as compared to the three months ended March 31, 2024. Base management fee increased primarily due to an increase of $4.5 million, or 0.6%, in average gross assets less cash for the three months ended March 31, 2025 as compared to the three months ended March 31, 2024.
Current wording
Base management fee expense decreased by $0.1 million, or 2.2%, to $3.0 million for the three months ended June 30, 2025 as compared to the three months ended June 30, 2024. Base management fee decreased primarily due to a decrease of $16.9 million, or 2.4%, in average gross assets less cash for the three months ended June 30, 2025 as compared to the three months ended June 30, 2024.
Previous wording
Administrative fee expense, professional fees and general and administrative expenses were $1.6 million and $1.5 million for the three months ended March 31, 2025 and 2024, respectively.
Current wording
Administrative fee expense, professional fees and general and administrative expenses were $1.5 million and $1.4 million for the three months ended June 30, 2025 and 2024, respectively.
Previous wording
During the three months ended March 31, 2025 and 2024, we realized net gains on investments totaling $0.001 million and $0.01 million, respectively.
Current wording
During the three months ended June 30, 2025, we realized net losses on investments totaling $9.3 million primarily due to the settlement of two of our debt investments. During the same period, we converted $12.5 million in outstanding principal of the 2031 Convertible Notes which resulted in a realized loss on extinguishment of debt of $0.8 million. For the three months ended June 30, 2024, we realized net gains on investments totaling $2.5 million primarily due to the exercise and conversion to equity of one of our warrant investments.
Previous wording
During the three months ended March 31, 2025, net unrealized depreciation on investments totaled $32.2 million which was primarily due to (1) the unrealized depreciation on three of our debt investments and (2) the unrealized depreciation on two of our equity investments. During the three months ended March 31, 2024, net unrealized depreciation on investments totaled $4.0 million which was primarily due to the unrealized depreciation on two of our debt investments and one of our equity investments offset by the unrealized appreciation on one of our debt investments. The difficult equity fundraising market and under performance of certain portfolio companies, among other factors, resulted in us reducing the fair market value of the debt investments in such portfolio companies, thus increasing the unrealized depreciation on such debt investments.
Current wording
During the three months ended June 30, 2025, net unrealized depreciation on investments totaled $22.2 million which was primarily due to (1) the unrealized depreciation on seven of our debt investments and (2) the unrealized depreciation on two of our other investments partially offset by (1) the reversal of previously recorded unrealized depreciation from the settlement of two of our debt investments and (2) the unrealized appreciation of two of our warrant investments. During the three months ended June 30, 2024, net unrealized depreciation on investments totaled $24.5 million which was primarily due to (1) the unrealized depreciation on three of our debt investments and one of our equity investments and (2) the reversal of previously recorded unrealized appreciation from the exercise and conversion to equity of one of our warrant investments offset by the unrealized appreciation on two of our debt investments. The difficult equity fundraising market and under performance of certain portfolio companies, among other factors, resulted in us reducing the fair market value of the debt investments in such portfolio companies, thus increasing the unrealized depreciation on such debt investments.
Previous wording
There was no performance based incentive fee expense for the three months ended March 31, 2025. Performance based incentive fee expense decreased by $0.3 million, or 100.0% for the three months ended March 31, 2025 as compared to the three months ended March 31, 2024. This decrease was due to a decrease of $2.2 million, or 16.9%, in Pre-Incentive Fee Net Investment Income for the three months ended March 31, 2025 as compared to the three months ended March 31, 2024 and an Incentive Fee Cap calculated based on the Incentive Fee Cap and Deferral Mechanism in our Investment Management Agreement of $2.1 million for the three months ended March 31, 2025 compared to an Incentive Fee Cap of $2.3 million for the three months ended March 31, 2024. The Incentive Fee Cap and Deferral Mechanism resulted in $2.1 million of reduced incentive fee expense and increased net investment income for the three months ended March 31, 2025. The incentive fee on pre-incentive fee net investment income was subject to the Incentive Fee Cap for the three months ended March 31, 2025 due to the cumulative incentive fees paid exceeding 20% of cumulative pre-incentive fee net return during the applicable quarter and the 11 preceding full calendar quarters.
Current wording
There was no performance based incentive fee expense for the six months ended June 30, 2025. Performance based incentive fee expense decreased by $0.3 million, or 100.0% for the six months ended June 30, 2025 as compared to the six months ended June 30, 2024. This decrease was due to a decrease of $3.6 million, or 14.1%, in Pre-Incentive Fee Net Investment Income for the six months ended June 30, 2025 as compared to the six months ended June 30, 2024 and an Incentive Fee Cap calculated based on the Incentive Fee Cap and Deferral Mechanism in our Investment Management Agreement of $4.4 million for the six months ended June 30, 2025 compared to an Incentive Fee Cap of $4.9 million for the six months ended June 30, 2024. The Incentive Fee Cap and Deferral Mechanism resulted in $4.4 million of reduced incentive fee expense and increased net investment income for the six months ended June 30, 2025. The incentive fee on pre-incentive fee net investment income was subject to the Incentive Fee Cap for the six months ended June 30, 2025 due to the cumulative incentive fees paid exceeding 20% of cumulative pre-incentive fee net return during the applicable quarter and the 11 preceding full calendar quarters.
Previous wording
As of March 31, 2025 and December 31, 2024, we had cash and investments in money market funds of $74.0 million and $97.5 million, respectively. Cash and investments in money market funds are available to fund new investments, reduce borrowings, pay expenses, repurchase common stock and pay distributions. In addition, as of March 31, 2025 and December 31, 2024, we had $3.5 million and $3.3 million, respectively, of restricted investments in money market funds. Restricted investments in money market funds may be used to make monthly interest and principal payments on our 2022 Asset-Backed Notes, our NYL Facility or our Nuveen Facility. Our primary sources of capital have been from our public equity offerings, use of our revolving credit facility (the “Key Facility”) with KeyBank National Association (“Key”), the Note Funding Agreement (the “NYL Facility”), with several entities owned or affiliated with New York Life Insurance Company and the Nuveen Note Funding Agreement (the “Nuveen Facility”, together with the Key Facility and the NYL Facility, the “Credit Facilities”) with several entities owned or affiliated with Nuveen Alternative Advisors LLC, and issuance of our public and private debt securities.
Current wording
As of June 30, 2025 and December 31, 2024, we had cash and investments in money market funds of $77.9 million and $97.5 million, respectively. Cash and investments in money market funds are available to fund new investments, reduce borrowings, pay expenses, repurchase common stock and pay distributions. In addition, as of June 30, 2025 and December 31, 2024, we had $3.2 million and $3.3 million, respectively, of restricted investments in money market funds. Restricted investments in money market funds may be used to make monthly interest and principal payments on our 2022 Asset-Backed Notes, our NYL Facility or our Nuveen Facility. Our primary sources of capital have been from our public equity offerings, use of our revolving credit facility (the “Key Facility”) with KeyBank National Association (“Key”), the Note Funding Agreement (the “NYL Facility”), with several entities owned or affiliated with New York Life Insurance Company and the Nuveen Note Funding Agreement (the “Nuveen Facility”, together with the Key Facility and the NYL Facility, the “Credit Facilities”) with several entities owned or affiliated with Nuveen Alternative Advisors LLC, and issuance of our public and private debt securities.
Previous wording
During the three months ended March 31, 2025, we sold 404,305 shares of common stock under the 2023 Equity Distribution Agreement. For the same period, we received total accumulated net proceeds of approximately $3.6 million, including $0.1 million of offering expenses, from these sales.
Current wording
During the six months ended June 30, 2025, we sold 404,305 shares of common stock under the 2023 Equity Distribution Agreement. For the same period, we received total accumulated net proceeds of approximately $3.6 million, including $0.2 million of offering expenses, from these sales.
Previous wording
During the three months ended March 31, 2024, we sold 1,053,796 shares of common stock under the 2023 Equity Distribution Agreement. For the same period, we received total accumulated net proceeds of approximately $12.0 million, including $0.3 million of offering expenses, from these sales.
Current wording
During the six months ended June 30, 2024, we sold 2,570,045 shares of common stock under the 2023 Equity Distribution Agreement. For the same period, we received total accumulated net proceeds of approximately $29.1 million, including $0.6 million of offering expenses, from these sales.
Previous wording
On April 25, 2025, our Board extended a previously authorized stock repurchase program which allows us to repurchase up to $5.0 million of our common stock at prices below our net asset value (“NAV”) per share as reported in our most recent consolidated financial statements. Under the repurchase program, we may, but are not obligated to, repurchase shares of our outstanding common stock in the open market or in privately negotiated transactions from time to time. Any repurchases by us will comply with the requirements of Rule 10b‑18 under the Exchange Act and any applicable requirements of the 1940 Act. Unless extended by our Board, the repurchase program will terminate on the earlier of June 30, 2026 or the repurchase of $5.0 million of our common stock. During the three months ended March 31, 2025 and 2024, we did not make any repurchases of our common stock. From the inception of the stock repurchase program through March 31, 2025, we repurchased 167,465 shares of our common stock at an average price of $11.22 on the open market at a total cost of $1.9 million.
Current wording
On April 25, 2025, our Board extended a previously authorized stock repurchase program which allows us to repurchase up to $5.0 million of our common stock at prices below our net asset value (“NAV”) per share as reported in our most recent consolidated financial statements. Under the repurchase program, we may, but are not obligated to, repurchase shares of our outstanding common stock in the open market or in privately negotiated transactions from time to time. Any repurchases by us intend to comply with the requirements of Rule 10b‑18 under the Exchange Act and any applicable requirements of the 1940 Act. Unless extended by our Board, the repurchase program will terminate on the earlier of June 30, 2026 or the repurchase of $5.0 million of our common stock. During the three and six months ended June 30, 2025 and 2024, we did not make any repurchases of our common stock. From the inception of the stock repurchase program through June 30, 2025, we repurchased 167,465 shares of our common stock at an average price of $11.22 on the open market at a total cost of $1.9 million. From time to time, our Board assesses the size and effectiveness of the stock repurchase program and could elect to increase or decrease the size of the program in the future.
Previous wording
At March 31, 2025 and December 31, 2024 there was no outstanding principal balance under the Key Facility. As of March 31, 2025 and December 31, 2024, we had borrowing capacity under the Key Facility of $150.0 million. At March 31, 2025 and December 31, 2024, $38.5 million and $24.8 million, respectively, was available for borrowing under the Key Facility, subject to existing terms and advance rates.
Current wording
At June 30, 2025 and December 31, 2024 there was no outstanding principal balance under the Key Facility. As of June 30, 2025 and December 31, 2024, we had borrowing capacity under the Key Facility of $150.0 million. At June 30, 2025 and December 31, 2024, $38.3 million and $24.8 million, respectively, was available for borrowing under the Key Facility, subject to existing terms and advance rates.
Previous wording
At March 31, 2025 and December 31, 2024, the outstanding principal balance under the NYL Facility was $181.0 million. As of March 31, 2025 and December 31, 2024, we had borrowing capacity under the NYL Facility of $69.0 million. At March 31, 2025 and December 31, 2024, $13.5 million and $8.4 million, respectively, was available for borrowing under the NYL Facility, subject to existing terms and advance rates.
Current wording
At June 30, 2025 and December 31, 2024, the outstanding principal balance under the NYL Facility was $181.0 million. As of June 30, 2025 and December 31, 2024, we had borrowing capacity under the NYL Facility of $69.0 million. At June 30, 2025 and December 31, 2024, $0.2 million and $8.4 million, respectively, was available for borrowing under the NYL Facility, subject to existing terms and advance rates.
Previous wording
At March 31, 2025 and December 31, 2024, the outstanding principal balance under the Nuveen Facility was $90.0 million and $75.0 million, respectively. As of March 31, 2025 and December 31, 2024, we had borrowing capacity under the Nuveen Facility of $10.0 million and $25.0 million, respectively. At March 31, 2025 and December 31, 2024, $10.0 million and $9.9 million, respectively, was available for borrowing under the Nuveen Facility, subject to existing terms and advance rates.
Current wording
At June 30, 2025 and December 31, 2024, the outstanding principal balance under the Nuveen Facility was $90.0 million and $75.0 million, respectively. As of June 30, 2025 and December 31, 2024, we had borrowing capacity under the Nuveen Facility of $110.0 million and $25.0 million, respectively. At June 30, 2025 and December 31, 2024, $0.8 million and $9.9 million, respectively, was available for borrowing under the Nuveen Facility, subject to existing terms and advance rates.
Previous wording
On October 17, 2024, the Company entered into a note purchase agreement (the “2031 Note Purchase Agreement”), by and among the Company, and each purchaser named therein, in connection with the issuance and sale of $20.0 million aggregate principal of the Company’s 7.125% convertible notes due 2031 (the “2031 Convertible Notes”). At March 31, 2025 and December 31, 2024, the aggregate outstanding principal balance of the 2031 Convertible Notes was $20.0 million. The 2031 Convertible Notes were not outstanding as of March 31, 2024.
Current wording
On October 17, 2024, the Company entered into a note purchase agreement (the “2031 Note Purchase Agreement”), by and among the Company, and each purchaser named therein, in connection with the issuance and sale of $20.0 million aggregate principal of the Company’s 7.125% convertible notes due 2031 (the “2031 Convertible Notes”). At June 30, 2025 and December 31, 2024, the aggregate outstanding principal balance of the 2031 Convertible Notes was $7.5 million and $20.0 million, respectively. The 2031 Convertible Notes were not outstanding as of June 30, 2024.
Previous wording
Our operating activities used cash of $13.2 million for the three months ended March 31, 2025, and our financing activities used cash of $10.2 million for the same period. Our operating activities used cash primarily to purchase investments in portfolio companies partially offset by cash provided by principal payments received on our debt investments. Our financing activities used cash primarily to repay our 2022 Asset-Backed Notes and to pay distributions to our stockholders partially offset by an advance on our Nuveen Facility and the sale of shares through our ATM for net proceeds of $3.6 million.
Current wording
Our operating activities provided cash of $36.4 million for the six months ended June 30, 2025, and our financing activities used cash of $56.1 million for the same period. Our operating activities provided cash primarily from principal payments received on our debt investments partially offset by cash used to purchase investments in portfolio companies. Our financing activities used cash primarily to repay our 2022 Asset-Backed Notes and to pay distributions to our stockholders partially offset by an advance on our Nuveen Facility and the sale of shares through our ATM for net proceeds of $3.6 million.
Previous wording
Our operating activities provided cash of $4.0 million for the three months ended March 31, 2024, and our financing activities used cash of $8.4 million for the same period. Our operating activities provided cash from principal payments received on our debt investments partially offset by cash used to purchase investments in portfolio companies. Our financing activities used cash primarily to repay our Key Facility and to pay distributions to our stockholders, partially offset from the sale of shares through our ATM for net proceeds of $12.0 million.
Current wording
Our operating activities provided cash of $58.3 million for the six months ended June 30, 2024, and our financing activities used cash of $17.2 million for the same period. Our operating activities provided cash from principal payments received on our debt investments partially offset by cash used to purchase investments in portfolio companies. Our financing activities used cash primarily to repay our Key Facility and to pay distributions to our stockholders, partially offset from an advance on our Nuveen Facility and the sale of shares through our ATM for net proceeds of $29.1 million.
Previous wording
We entered into the Key Facility effective November 4, 2013. On June 20, 2024, we amended the Key Facility, among other things, (i) to extend the date on which we may request advances under the Key Facility to June 20, 2027 and to extend the maturity date to June 20, 2029 and (ii) to amend the interest rate to be based on the rate of interest published in The Wall Street Journal as the prime rate in the United States plus 0.10%, with a prime rate floor of 4.10%. Prior to June 20, 2024, the interest rate on the Key Facility was based on Prime plus 0.25%, with a prime rate floor of 4.25%. The prime rate was 7.50% as of March 31, 2025 and December 31, 2024, respectively. The interest rate in effect was 7.60% as of March 31, 2025 and December 31, 2024, respectively. The Key Facility requires the payment of an unused line fee in an amount up to 0.75% of any unborrowed amount available under the facility annually.
Current wording
We entered into the Key Facility effective November 4, 2013. On June 20, 2024, we amended the Key Facility, among other things, (i) to extend the date on which we may request advances under the Key Facility to June 20, 2027 and to extend the maturity date to June 20, 2029 and (ii) to amend the interest rate to be based on the rate of interest published in The Wall Street Journal as the prime rate in the United States plus 0.10%, with a prime rate floor of 4.10%. Prior to June 20, 2024, the interest rate on the Key Facility was based on Prime plus 0.25%, with a prime rate floor of 4.25%. The prime rate was 7.50% as of June 30, 2025 and December 31, 2024, respectively. The interest rate in effect was 7.60% as of June 30, 2025 and December 31, 2024. The Key Facility requires the payment of an unused line fee in an amount up to 0.75% of any unborrowed amount available under the facility annually.
Previous wording
HFI is a wholly-owned subsidiary of HSLFI. HFI entered into the NYL Facility with the NYL Noteholders for an aggregate purchase price of up to $100.0 million, with an accordion feature of up to $200.0 million at the mutual discretion and agreement of HSLFI and the NYL Noteholders. On June 1, 2018, HSLFI sold or contributed to HFI certain secured loans made to certain portfolio companies pursuant to the Sale and Servicing Agreement. Any notes issued by HFI are collateralized by all investments held by HFI and permit an advance rate of up to 67% of the aggregate principal amount of eligible debt investments.
Current wording
HFI is a wholly-owned subsidiary of HSLFI. HFI entered into the NYL Facility with the NYL Noteholders for an aggregate purchase price of up to $100.0 million, with an accordion feature of up to $200.0 million at the mutual discretion and agreement of HSLFI and the NYL Noteholders. On June 1, 2018, HSLFI sold or contributed to HFI certain secured loans made to certain portfolio companies pursuant to the Sale and Servicing Agreement. Any notes issued by HFI are collateralized by all investments held by HFI and permit an advance rate of up to 67% of the aggregate principal amount of eligible debt investments. All advances under the NYL Facility are scheduled to mature in June 2030.
Previous wording
On May 24, 2023, we amended the NYL Facility to, among other things, increase the commitment by $50.0 million to enable our wholly-owned subsidiary to issue up to $250.0 million of secured notes. In addition, the amendment amended the interest rate for advances made after May 24, 2023, fixing the interest rate at the greater of (i) 4.60% and (ii) the Three Year I-Curve plus 3.50% with the interest rate to be reset on any advance date.
Current wording
On May 24, 2023, we amended the NYL Facility to, among other things, increase the commitment by $50.0 million to enable our wholly-owned subsidiary to issue up to $250.0 million of secured notes. On April 25, 2025, we amended the NYL Facility to, among other things, extend the investment period to June 5, 2027. In addition, the amendment amended the interest rate for advances made after April 25, 2025, fixing the interest rate at the greater of (i) 4.60% and (ii) the Three Year I Curve plus 2.95% with the interest rate to be reset on any advance date.
Previous wording
There were $181.0 million in notes issued to the NYL Noteholders as of March 31, 2025 and December 31, 2024 at an interest rate of 6.54% and 6.47%, respectively. As of March 31, 2025 and December 31, 2024, we had borrowing capacity under the NYL Facility of $69.0 million. At March 31, 2025 and December 31, 2024, $13.5 million and $8.4 million, respectively, was available for borrowing, subject to existing terms and advance rates.
Current wording
There were $181.0 million in notes issued to the NYL Noteholders as of June 30, 2025 and December 31, 2024 at an interest rate of 6.55% and 6.47%, respectively. As of June 30, 2025 and December 31, 2024, we had borrowing capacity under the NYL Facility of $69.0 million. At June 30, 2025 and December 31, 2024, $0.2 million and $8.4 million, respectively, was available for borrowing, subject to existing terms and advance rates.
Previous wording
HFII entered into the Nuveen Facility with the Nuveen Noteholders for an aggregate purchase price of up to $100.0 million, with an accordion feature of up to $200.0 million at the mutual discretion and agreement us and the Nuveen Noteholders. On June 21, 2024, we sold or contributed to HFII certain secured loans made to certain portfolio companies pursuant to the Sale and Servicing Agreement. Any notes issued by HFII are collateralized by all investments held by HFII and permit an advance rate of up to 67.5% of the aggregate principal amount of eligible debt investments. The Nuveen Facility bears interest, payable monthly, determined at a rate per annum equal to the greater of (i) the yield for the United States Treasury constant maturity 3-year and 5-year in the most recent statistical release published by the Board of Governors of the Federal Reserve System designated as “Selected Interest Rates (Daily) – H.15” interpolated to a 4.88-year weighted average life plus 3.15% and (ii) 5.00%. We may request advances under the Nuveen Facility through June 21, 2027 and the Nuveen Facility is scheduled to mature on June 10, 2033.
Current wording
HFII entered into the Nuveen Facility with the Nuveen Noteholders for an aggregate purchase price of up to $100.0 million, with an accordion feature of up to $200.0 million at the mutual discretion and agreement us and the Nuveen Noteholders. On June 21, 2024, we sold or contributed to HFII certain secured loans made to certain portfolio companies pursuant to the Sale and Servicing Agreement. Any notes issued by HFII are collateralized by all investments held by HFII and permit an advance rate of up to 67.5% of the aggregate principal amount of eligible debt investments. The Nuveen Facility bore interest, payable monthly, determined at a rate per annum equal to the greater of (i) the yield for the United States Treasury constant maturity 3-year and 5-year in the most recent statistical release published by the Board of Governors of the Federal Reserve System designated as “Selected Interest Rates (Daily) – H.15” interpolated to a 4.88-year weighted average life (the “Pricing Benchmark”) plus 3.15% and (ii) 5.00%.
Previous wording
On May 6, 2024, we amended the NYL Facility to, among other things, extend the investment period to June 2025 and the maturity date of all advances to June 2030. In addition, the amendment amended the interest rate for advances made after May 6, 2024, fixing the interest rate at the greater of (i) 4.60% and (ii) the Three Year I Curve plus 3.20%, with the interest rate to be reset on any advance date.
Current wording
On May 23, 2025, we amended the Nuveen Facility to, among other things, extend the investment period to June 21, 2028 and the maturity date to June 10, 2034, and increase the commitment by $100.0 million which enables our wholly-owned subsidiary to issue up to $200.0 million of secured notes. In addition, the amendment amended the interest rate for advances made after May 23, 2025, fixing the interest rate at the greater of (i) 5.00% and (ii) the Pricing Benchmark plus 2.95%.
Previous wording
Under the terms of the Nuveen Facility, we are required to maintain a reserve cash balance, which may be used to pay monthly interest and principal payments on the Nuveen Facility. We have segregated these funds and classified them as restricted investments in money market funds. At March 31, 2025 and December 31, 2024, there were approximately $1.2 million and $1.0 million, respectively, of such restricted investments.
Current wording
Under the terms of the Nuveen Facility, we are required to maintain a reserve cash balance, which may be used to pay monthly interest and principal payments on the Nuveen Facility. We have segregated these funds and classified them as restricted investments in money market funds. At June 30, 2025 and December 31, 2024, there were approximately $1.1 million and $1.0 million, respectively, of such restricted investments.
Previous wording
There were $90.0 million and $75.0 million in notes issued to the Nuveen Noteholders as of March 31, 2025 and December 31, 2024 at an interest rate of 7.21% and 7.14%, respectively. As of March 31, 2025 and December 31, 2024, we had borrowing capacity under the Nuveen Facility of $10.0 million and $25.0 million. At March 31, 2025 and December 31, 2024, $10.0 million and $9.9 million, respectively, was available for borrowing, subject to existing terms and advance rates.
Current wording
There were $90.0 million and $75.0 million in notes issued to the Nuveen Noteholders as of June 30, 2025 and December 31, 2024 at an interest rate of 7.21% and 7.14%, respectively. As of June 30, 2025 and December 31, 2024, we had borrowing capacity under the Nuveen Facility of $110.0 million and $25.0 million. At June 30, 2025 and December 31, 2024, $0.8 million and $9.9 million, respectively, was available for borrowing, subject to existing terms and advance rates.
Previous wording
At March 31, 2025 and December 31, 2024, the 2022 Asset-Backed Notes had an outstanding principal balance of $65.0 million and $81.1 million, respectively.
Current wording
At June 30, 2025 and December 31, 2024, the 2022 Asset-Backed Notes had an outstanding principal balance of $34.2 million and $81.1 million, respectively.
Previous wording
Under the terms of the 2022 Asset-Backed Notes, we are required to maintain a reserve cash balance, funded through proceeds from the sale of the 2022 Asset-Backed Notes, which may be used to pay monthly interest and principal payments on the 2022 Asset-Backed Notes. We have segregated these funds and classified them as restricted investments in money market funds. At March 31, 2025, and December 31, 2024, there were approximately $0.9 million and $1.0 million, respectively, of such restricted investments.
Current wording
Under the terms of the 2022 Asset-Backed Notes, we are required to maintain a reserve cash balance, funded through proceeds from the sale of the 2022 Asset-Backed Notes, which may be used to pay monthly interest and principal payments on the 2022 Asset-Backed Notes. We have segregated these funds and classified them as restricted investments in money market funds. At June 30, 2025, and December 31, 2024, there were approximately $0.8 million and $1.0 million, respectively, of such restricted investments.
Previous wording
As of March 31, 2025 and December 31, 2024, the aggregate outstanding principal balance of the 2031 Convertible Notes was $20.0 million.
Current wording
As of June 30, 2025 and December 31, 2024, the aggregate outstanding principal balance of the 2031 Convertible Notes was $7.5 million and $20.0 million, respectively.
Previous wording
As of March 31, 2025 and December 31, 2024, other assets were $6.2 million and $6.5 million, respectively, which was primarily comprised of debt issuance costs and prepaid expenses.
Current wording
As of June 30, 2025 and December 31, 2024, other assets were $8.7 million and $6.5 million, respectively, which were primarily comprised of debt issuance costs and prepaid expenses.
Showing the first 40 of 45 pairs. Open the source sections for the rest.
Rearranged current paragraphs (14)
Current report — wording carried from elsewhere
There was no performance based incentive fee expense for the three months ended June 30, 2025 and 2024. The incentive fee on pre-incentive fee net investment income was subject to an Incentive Fee Cap and Deferral Mechanism in our Investment Management Agreement of $2.3 million for the three months ended June 30, 2025 compared to an Incentive Fee Cap of $2.6 million for the three months ended June 30, 2024. The Incentive Fee Cap and Deferral Mechanism resulted in $2.3 million of reduced incentive fee expense and increased net investment income for the three months ended June 30, 2025. The incentive fee on pre-incentive fee net investment income was subject to the Incentive Fee Cap for the three months ended June 30, 2025 due to the cumulative incentive fees paid exceeding 20% of cumulative pre-incentive fee net return during the applicable quarter and the 11 preceding full calendar quarters.
Current report — wording carried from elsewhere
The following table shows consolidated results of operations for the six months ended June 30, 2025 and 2024:
Current report — wording carried from elsewhere
Net decrease in net assets resulting from operations can vary substantially from period to period for various reasons, including, without limitation, the recognition of realized gains and losses and unrealized appreciation and depreciation on investments. As a result, quarterly comparisons of net increase in net assets resulting from operations may not be meaningful.
Current report — wording carried from elsewhere
Total investment income decreased by $2.8 million, or 5.3%, to $49.0 million for the six months ended June 30, 2025 as compared to the six months ended June 30, 2024. For the six months ended June 30, 2025, total investment income consisted primarily of (1) $46.1 million in interest income from investments, which included $7.6 million in income from the accretion of origination fees and end of term payments and $0.5 million in PIK interest income and (2) $3.0 million in fee income.
Current report — wording carried from elsewhere
Interest income on debt investments decreased by $4.5 million, or 8.8%, to $46.1 million, for the six months ended June 30, 2025 compared to the six months ended June 30, 2024. Interest income on debt investments for the six months ended June 30, 2025 as compared to the six months ended June 30, 2024 decreased primarily due to a decrease in the Prime Rate which is the base rate for most of our variable rate debt investments. The proportion of total investment income that resulted from the portion of ETPs not received in cash for the six months ended June 30, 2025 and 2024 was 3.7% and 6.7%, respectively. The decrease in the proportion of total investment income that resulted from the portion of ETPs not received in cash was a result of an increase in prepayments for the six months ended June 30, 2025 compared to the six months ended June 30, 2024.
Current report — wording carried from elsewhere
PIK interest income decreased by $1.2 million, or 69.6%, to $0.5 for the six months ended June 30, 2025 compared to the six months ended June 30, 2024. For the six months ended June 30, 2025 and 2024, 1.1% and 3.3%, respectively, of total investment income was attributable to non-cash PIK interest income. The decrease in PIK interest income as a percentage of total investment income was primarily due to a decrease in earning assets that contain a PIK feature for the six months ended June 30, 2025 compared to the six months ended June 30, 2024.
Current report — wording carried from elsewhere
Fee income, which includes success fee, other fee and prepayment fee income on debt investments, increased by $1.7 million, or 132.7%, to $3.0 million for the six months ended June 30, 2025 compared to the six months ended June 30, 2024 primarily due to a higher aggregate amount of principal prepayments for the six months ended June 30, 2025 compared to the six months ended June 30, 2024.
Current report — wording carried from elsewhere
The following table shows our dollar-weighted annualized yield for the six months ended June 30, 2025 and 2024:
Current report — wording carried from elsewhere
Investment income, consisting of interest income and fees on debt investments, can fluctuate significantly upon repayment of large debt investments. Interest income from the five largest debt investments at cost in the aggregate accounted for 17% and 18% of investment income for the six months ended June 30, 2025 and 2024, respectively. Interest income from the five largest debt investments at fair value in the aggregate accounted for 20% and 22% of investment income for the six months ended June 30, 2025 and 2024, respectively.
Current report — wording carried from elsewhere
Total expenses increased by $0.6 million, or 2.2%, to $26.1 million for the six months ended June 30, 2025 as compared to the six months ended June 30, 2024. Total expenses for each period consisted of interest expense, base management fee, incentive and administrative fees, professional fees and general and administrative expenses.
Current report — wording carried from elsewhere
Interest expense increased by $0.8 million, or 4.9%, to $16.9 million for the six months ended June 30, 2025 as compared to the six months ended June 30, 2024. Interest expense, which includes the amortization of debt issuance costs, increased primarily due to an increase in average borrowings of $4.0 million, or 0.9%, for the six months ended June 30, 2025 as compared to the six months ended June 30, 2024 and an increase in our effective cost of debt for the six months ended June 30, 2025 as compared to the six months ended June 30, 2024.
Current report — wording carried from elsewhere
Net realized gains and losses and net unrealized appreciation and depreciation
Current report — wording carried from elsewhere
Realized gains or losses on investments are measured by the difference between the net proceeds from the repayment or sale and the cost basis of our investments without regard to unrealized appreciation or depreciation previously recognized. Realized gains or losses on investments include investments charged off during the period, net of recoveries. The net change in unrealized appreciation or depreciation on investments primarily reflects the change in portfolio investment fair values during the reporting period, including the reversal of previously recorded unrealized appreciation or depreciation when gains or losses are realized.
Current report — wording carried from elsewhere
During the six months ended June 30, 2025, net unrealized depreciation on investments totaled $54.3 million which was primarily due to (1) the unrealized depreciation on seven of our debt investments, (2) the unrealized depreciation on four of our other investments and (3) the unrealized depreciation on two of our equity investments partially offset by (1) the reversal of previously recorded unrealized depreciation from the settlement of one of our debt investments and (2) the unrealized appreciation of two of our warrant investments. During the six months ended June 30, 2024, net unrealized depreciation on investments totaled $28.5 million which was primarily due to (1) the unrealized depreciation on four of our debt investments and one of our equity investments and (2) the reversal of previously recorded unrealized appreciation from the exercise and conversion to equity of one of our warrant investments offset by the unrealized appreciation on one of our debt investments. The difficult equity fundraising market and under performance of certain portfolio companies, among other factors, resulted in us reducing the fair market value of the debt investments in such portfolio companies, thus increasing the unrealized depreciation on such debt investments.
Rearranged previous paragraphs (2)
Previous report — wording carried elsewhere
On April 25, 2025, we amended our NYL Facility to, among other things, extend the investment period to June 5, 2027. In addition, the amendment amended the interest rate for advances made after April 25, 2025, fixing the interest rate at the greater of (i) 4.60% and (ii) the Three Year I Curve plus 2.95% with the interest rate to be reset on any advance date.
Previous report — wording carried elsewhere
On April 28, 2025 (the “Conversion Date”), the holders of the 2031 Convertible Notes converted $2.0 million of the principal balance of the 2031 Convertible Notes plus accrued interest into 237,714 shares of common stock of the Company at the volume-weighted average closing sale price for the five trading days immediately prior to the Conversion Date of $8.46.