Horizon Technology Finance Corp

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 September 30, 2025, 97.0%, or $543.6 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 March 31, 2026, 97.5%, or $629.3 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.

Previous wording

On August 7, 2025, we entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Monroe Capital Corporation, a Maryland corporation (“MRCC”), HMMS, Inc., a Maryland corporation and wholly owned subsidiary of us (“Merger Sub”), Monroe Capital BDC Advisors, LLC, an investment adviser to MRCC, and the Advisor. The Merger Agreement provides that, subject to the conditions set forth in the Merger Agreement, immediately following the Asset Sale (as defined below) and at the effective time of the Merger (the “Effective Time”), Merger Sub will merge with and into MRCC, with MRCC continuing as the surviving company and as a wholly owned subsidiary of us and, immediately thereafter, MRCC will merge with and into us, with us continuing as the surviving company (collectively, the “Mergers”). MRCC also entered into an Asset Purchase Agreement (the “Asset Purchase Agreement”) with Monroe Capital Income Plus Corporation, a Maryland corporation (“MCIP”), and MC Advisors, pursuant to which, subject to the satisfaction or waiver of the closing conditions set forth in the Asset Purchase Agreement, on the closing date of the transactions contemplated by the Asset Purchase Agreement (the “Closing Date”), MCIP will acquire all of MRCC’s investment assets and liabilities at fair value, as determined shortly before the Closing Date, for cash (the “Asset Sale” and together with the Merger, the “Transactions”). Under the Asset Purchase Agreement, the Asset Sale is contingent upon, and will become effective immediately prior to the effectiveness of, the Merger.

Current wording

On April 14, 2026, the Company completed its previously announced merger with Monroe Capital Corporation (“MRCC”), HMMS, Inc. (“Merger Sub”), Monroe Capital BDC Advisors, LLC, and the Advisor, pursuant to the Agreement and Plan of Merger, dated as of August 7, 2025 (the “Merger Agreement”). Pursuant to the Merger Agreement, immediately following the Asset Sale (as defined below) and at the effective time of the Merger (the “Effective Time”), Merger Sub merged with and into MRCC, with MRCC continuing as the surviving company and as a wholly owned subsidiary of the Company, and, immediately thereafter, MRCC merged into the Company, with the Company continuing as the surviving company (collectively, the “Mergers”). MRCC also entered into an Asset Purchase Agreement (the “Asset Purchase Agreement”) with Monroe Capital Income Plus Corporation (“MCIP”), and MC Advisors, pursuant to which, MCIP acquired all of MRCC’s investment assets and liabilities at fair value, for cash (the “Asset Sale” and together with the Merger, the “Transactions”).

Previous wording

The following table shows total portfolio investment activity as of and for the three and nine months ended September 30, 2025 and 2024:

Current wording

The following table shows total portfolio investment activity as of and for the three months ended March 31, 2026 and 2025:

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 25% and 22% of total debt investments outstanding as of September 30, 2025 and December 31, 2024, respectively. Our five largest debt investments at fair value represented 26% and 23% of total debt investments outstanding as of September 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 September 30, 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 24% and 26% of total debt investments outstanding as of March 31, 2026 and December 31, 2025, respectively. Our five largest debt investments at fair value represented 24% and 26% of total debt investments outstanding as of March 31, 2026 and December 31, 2025, respectively. No single debt investment at cost or fair value represented more than 10% of our total debt investments as of March 31, 2026 and December 31, 2025.

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 September 30, 2025 and December 31, 2024, our debt investments had a weighted average credit rating of 2.9 and 3.1, respectively. The following table shows the classification of our debt investment portfolio by credit rating as of September 30, 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 March 31, 2026 and December 31, 2025, our debt investments had a weighted average credit rating of 3.0 and 2.9, respectively. The following table shows the classification of our debt investment portfolio by credit rating as of March 31, 2026 and December 31, 2025:

Previous wording

As of September 30, 2025, there were four debt investments with an internal credit rating of 1, with an aggregate cost of $61.3 million and an aggregate fair value of $29.3 million and there were four debt investments with an internal credit rating of 2, with an aggregate cost of $43.7 million and an aggregate fair value of $42.1 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 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 March 31, 2026, there were four debt investments with an internal credit rating of 1, with an aggregate cost of $33.1 million and an aggregate fair value of $24.3 million and there were four debt investments with an internal credit rating of 2, with an aggregate cost of $56.9 million and an aggregate fair value of $50.2 million. As of December 31, 2025, there were four debt investments with an internal credit rating of 1, with an aggregate cost of $33.8 million and an aggregate fair value of $24.5 million and there were four debt investments with an internal credit rating of 2, with an aggregate cost of $56.8 million and an aggregate fair value of $53.5 million.

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 increase (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 increased by $1.8 million, or 7.1%, to $26.3 million for the three months ended September 30, 2025 as compared to the three months ended September 30, 2024. For the three months ended September 30, 2025, total investment income consisted primarily of (1) $24.3 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 $0.7 million in PIK interest income and (2) $2.0 million in fee income.

Current wording

Total investment income decreased by $0.4 million, or 1.8%, to $24.1 million for the three months ended March 31, 2026 as compared to the three months ended March 31, 2025. For the three months ended March 31, 2026, total investment income consisted primarily of (1) $23.1 million in interest income from investments, which included $5.0 million in income from the accretion of origination fees and end of term payments and $1.3 million in PIK interest income and (2) $1.0 million in fee income.

Previous wording

Interest income on debt investments decreased by $3.4 million, or 4.6%, to $70.4 million, for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. Interest income on debt investments for the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024 decreased primarily due to a decrease of $13.5 million, or 2.2%, in our average earning debt investments and the 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 nine months ended September 30, 2025 and 2024 was 3.6% and 6.0%, 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 nine months ended September 30, 2025 compared to the nine months ended September 30, 2024.

Current wording

Interest income on debt investments decreased by $0.4 million, or 1.6%, to $23.1 million, for the three months ended March 31, 2026 compared to the three months ended March 31, 2025. Interest income on debt investments for the three months ended March 31, 2026 as compared to the three months ended March 31, 2025 decreased primarily due to a decrease in the Prime Rate which is the base rate for most of our variable rate debt investments and a decrease of $19.5 million, or 3.0%, in our average earning debt investments partially offset by an increase in accelerated income from prepayments. The proportion of total investment income that resulted from the portion of ETPs not received in cash for the three months ended March 31, 2026 and 2025 was 6.0% and 4.6%, respectively. The increase 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 accretion of final payments for the three months ended March 31, 2026 compared to the three months ended March 31, 2025.

Previous wording

PIK interest income increased by $0.3 million, or 75.0%, to $0.7 for the three months ended September 30, 2025 compared to the three months ended September 30, 2024. For the three months ended September 30, 2025 and 2024, 2.5% and 1.5%, respectively, of total investment income was attributable to non-cash PIK interest income. The increase in PIK interest income as a percentage of total investment income was primarily due to an increase in earning assets that contain a PIK feature for the three months ended September 30, 2025 compared to the three months ended September 30, 2024.

Current wording

PIK interest income increased by $1.0 million, or 348.4%, to $1.3 million for the three months ended March 31, 2026 compared to the three months ended March 31, 2025. For the three months ended March 31, 2026 and 2025, 5.3% and 1.2%, respectively, of total investment income was attributable to non-cash PIK interest income. The increase in PIK interest income as a percentage of total investment income was primarily due to an increase in earning assets that contain a PIK feature for the three months ended March 31, 2026 compared to the three months ended March 31, 2025.

Previous wording

Fee income, which includes success fee, other fee and prepayment fee income on debt investments, increased by $0.6 million, or 46.7%, to $2.0 million for the three months ended September 30, 2025 compared to the three months ended September 30, 2024 primarily due to a higher aggregate amount of principal prepayments for the three months ended September 30, 2025 compared to the three months ended September 30, 2024.

Current wording

Fee income, which includes success fee, other fee and prepayment fee income on debt investments, decreased by $0.1 million, or 6.1%, to $1.0 million for the three months ended March 31, 2026 compared to the three months ended March 31, 2025 primarily due to a lower success fee and other fee income for the three months ended March 31, 2026 compared to the three months ended March 31, 2025.

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 17% and 21% of investment income for the three months ended September 30, 2025 and 2024, respectively. Interest income from the five largest debt investments at fair value in the aggregate accounted for 21% and 25% of investment income for the three months ended September 30, 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 23% and 24% of investment income for the three months ended March 31, 2026 and 2025, respectively. Interest income from the five largest debt investments at fair value in the aggregate accounted for 23% and 24% of investment income for the three months ended March 31, 2026 and 2025, respectively.

Previous wording

Total expenses decreased by $0.4 million, or 3.2%, to $12.0 million for the three months ended September 30, 2025 as compared to the three months ended September 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 wording

Total expenses increased by $1.4 million, or 10.6%, to $14.8 million for the three months ended March 31, 2026 as compared to the three months ended March 31, 2025. 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 decreased by $0.05 million, or 0.6%, to $7.9 million for the three months ended September 30, 2025 as compared to the three months ended September 30, 2024. Interest expense, which includes the amortization of debt issuance costs, decreased primarily due to a decrease in average borrowings for the three months ended September 30, 2025 of $18.9 million, or 4.3%, as compared to the three months ended September 30, 2024 partially offset by an increase in our effective cost of debt for the three months ended September 30, 2025 as compared to the three months ended September 30, 2024.

Current wording

Interest expense decreased by $0.5 million, or 5.8%, to $8.2 million for the three months ended March 31, 2026 as compared to the three months ended March 31, 2025. Interest expense, which includes the amortization of debt issuance costs, decreased primarily due to a decrease in average borrowings for the three months ended March 31, 2026 of $25.3 million, or 5.4%, as compared to the three months ended March 31, 2025 and a decrease in our effective cost of debt for the three months ended March 31, 2026 as compared to the three months ended March 31, 2025.

Previous wording

Base management fee expense decreased by $0.2 million, or 8.1%, to $2.7 million for the three months ended September 30, 2025 as compared to the three months ended September 30, 2024. Base management fee decreased primarily due to a decrease of $60.0 million, or 8.8%, in average gross assets less cash for the three months ended September 30, 2025 as compared to the three months ended September 30, 2024.

Current wording

Base management fee expense decreased by $0.1 million, or 1.9%, to $3.1 million for the three months ended March 31, 2026 as compared to the three months ended March 31, 2025. Base management fee decreased primarily due to a decrease of $15.0 million, or 2.1%, in average gross assets less cash for the three months ended March 31, 2026 as compared to the three months ended March 31, 2025.

Previous wording

There was no performance based incentive fee expense for the three months ended September 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 $2.8 million for the three months ended September 30, 2025 compared to an Incentive Fee Cap of $2.4 million for the three months ended September 30, 2024. The Incentive Fee Cap and Deferral Mechanism resulted in $2.8 million of reduced incentive fee expense and increased net investment income for the three months ended September 30, 2025. The incentive fee on pre-incentive fee net investment income was subject to the Incentive Fee Cap for the three months ended September 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 wording

Performance based incentive fee expense increased by $1.8 million to $1.8 million for the three months ended March 31, 2026 as compared to the three months ended March 31, 2025. There was no performance based incentive fee expense for three months ended March 31, 2025. This increase was due to an Incentive Fee Cap calculated based on the Incentive Fee Cap and Deferral Mechanism in our Investment Management Agreement of $0.4 million for the three months ended March 31, 2026 compared to an Incentive Fee Cap of $2.1 million for the three months ended March 31, 2025. The Incentive Fee Cap and Deferral Mechanism resulted in $0.4 million and $2.1 million of reduced incentive fee expense and increased net investment income for the three months ended March 31, 2026 and 2025, respectively. The incentive fee on pre-incentive fee net investment income was subject to the Incentive Fee Cap for the three months ended March 31, 2026 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

Administrative fee expense, professional fees and general and administrative expenses were $1.3 million and $1.4 million for the three months ended September 30, 2025 and 2024, respectively.

Current wording

Administrative fee expense, professional fees and general and administrative expenses were $1.8 million and $1.6 million for the three months ended March 31, 2026 and 2025, respectively.

Previous wording

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 wording

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 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.

Previous wording

During the nine months ended September 30, 2025, we realized net losses on investments totaling $31.8 million primarily due to (1) the settlement of two debt investments, two equity investments and two other investments and (2) the realization of two warrant investments. During the same period, we converted $17.3 million in outstanding principal of the 2031 Convertible Notes which resulted in a realized loss on extinguishment of debt of $1.2 million. During the same period, we elected to exercise our option to redeem the outstanding balance of our 2022 Asset-Backed Notes (as defined below) which resulted in a realized loss on debt extinguishment of $0.9 million. During the nine months ended September 30, 2024, we realized net losses on investments totaling $31.4 million primarily due to the settlement of one debt investments.

Current wording

During the three months ended March 31, 2026 and March 31, 2025, we realized netlosses on investments totaling$0.2 million and$0.001 million, respectively. During the three months ended March 31, 2026, we converted$15.1 million in outstanding principal of the 2030 Convertible Notes (as defined below) which resulted in a realized loss on extinguishment of debt of $1.3 million. During the same period, we redeemed all of the outstanding principal balance of the 2026 Notes (as defined below) which resulted in a realized loss onextinguishment of debt of $0.1 million.

Previous wording

During the nine months ended September 30, 2025, net unrealized depreciation on investments totaled $13.8 million which was primarily due to (1) the unrealized depreciation of four debt investments, three other investments and three equity investments and (2) the reversal of previously recorded unrealized appreciation from the realization of two warrant investments partially offset by (1) the unrealized appreciation on two debt investments and one equity investment, (2) the reversal of previously recorded unrealized depreciation from the settlement of one debt investment, one other investment, one equity investment and (3) the unrealized appreciation on the acquisition of debt investments. During the nine months ended September 30, 2024, net unrealized appreciation on investments totaled $0.9 million which was primarily due to (1) the reversal of previously recorded unrealized depreciation from the settlement of one debt investment and (2) the unrealized appreciation on one other investment partially offset by (1) the unrealized depreciation on four debt investments and (2) the unrealized depreciation on our warrant and equity 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 March 31, 2026, net unrealized depreciation on investments totaled $4.6 million which was primarily due to the unrealized depreciation on two of our debt investments and one of our equity investments and the unrealized depreciation on our warrant investments. During the three months ended March 31, 2025, net unrealized depreciation on investments totaled $32.2 million which was primarily due to the unrealized depreciation on three of our debt investments and two of our equity investments. The difficult equity fundraising market and under performance of certain portfolio companies, among other factors, resulted in our reduction of the fair market value of the debt investments in such portfolio companies, thus increasing the unrealized depreciation on such debt investments.

Previous wording

As of September 30, 2025 and December 31, 2024, we had cash and investments in money market funds of $128.5 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 September 30, 2025 and December 31, 2024, we had $2.4 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 March 31, 2026 and December 31, 2025, we had cash and investments in money market funds of $70.6 million and $140.2 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, 2026 and December 31, 2025, we had $2.6 million and $2.5 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 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

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. On August 5, 2025, our Board authorized an increase in the maximum amount of 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. During the three and nine months ended September 30, 2025 and 2024, we did not make any repurchases of our common stock. From the inception of the stock repurchase program through September 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.

Current wording

On May 1, 2026, our Board extended a previously authorized stock repurchase program which allows us to repurchase up to $10.0 million of our common stock at prices below our net asset value (“NAV”) per share as reported in our most recent consolidated financial statements, 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 NAV per share. 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, 2027 or the repurchase of $10.0 million of our common stock. During the three months ended March 31, 2026 and 2025, we did not make any repurchases of our common stock under our stock repurchase program. From the date of the inception of our stock repurchase program through March 31, 2026, 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 September 30, 2025 and December 31, 2024 there was no outstanding principal balance under the Key Facility. As of September 30, 2025 and December 31, 2024, we had borrowing capacity under the Key Facility of $150.0 million. At September 30, 2025 and December 31, 2024, $42.0 million and $24.8 million, respectively, was available for borrowing under the Key Facility, subject to existing terms and advance rates.

Current wording

At March 31, 2026, the outstanding principal balance under the Key Facility was $45.0 million. At December 31, 2025, there was no outstanding principal balance under the Key Facility. As of March 31, 2026 and December 31, 2025, we had borrowing capacity under the Key Facility of $105.0 million and $150.0, respectively. At March 31, 2026 and December 31, 2025, $23.3 million and $49.6 million, respectively, was available for borrowing under the Key Facility, subject to existing terms and advance rates.

Previous wording

At September 30, 2025 and December 31, 2024, the outstanding principal balance under the NYL Facility was $181.0 million. As of September 30, 2025 and December 31, 2024, we had borrowing capacity under the NYL Facility of $69.0 million. At September 30, 2025 and December 31, 2024, $8.9 million and $8.4 million, respectively, was available for borrowing under the NYL Facility, subject to existing terms and advance rates.

Current wording

At March 31, 2026 and December 31, 2025, the outstanding principal balance under the NYL Facility was $181.0 million. As of March 31, 2026 and December 31, 2025, we had borrowing capacity under the NYL Facility of $69.0 million. At March 31, 2026 and December 31, 2025, $2.6 million and $1.9 million, respectively, was available for borrowing under the NYL Facility, subject to existing terms and advance rates.

Previous wording

At September 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 September 30, 2025 and December 31, 2024, we had borrowing capacity under the Nuveen Facility of $110.0 million and $25.0 million, respectively. At September 30, 2025 and December 31, 2024, $0.6 million and $9.9 million, respectively, was available for borrowing under the Nuveen Facility, subject to existing terms and advance rates.

Current wording

At March 31, 2026 and December 31, 2025, the outstanding principal balance under the Nuveen Facility was $90.0 million. As of March 31, 2026 and December 31, 2025, we had borrowing capacity under the Nuveen Facility of $110.0 million. At March 31, 2026 and December 31, 2025, $22.3 million and $12.1 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 September 30, 2025 and December 31, 2024, the aggregate outstanding principal balance of the 2031 Convertible Notes was $2.8 million and $20.0 million, respectively. The 2031 Convertible Notes were not outstanding as of September 30, 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 March 31, 2026 and December 31, 2025, the aggregate outstanding principal balance of the 2031 Convertible Notes was $2.8 million.

Previous wording

On September 4, 2025, the Company entered into a note purchase agreement (the “2030 Note Purchase Agreement”), by and among the Company, and each purchaser named therein, in connection with the issuance and sale of $40.0 million aggregate principal of the Company’s 5.50% convertible notes due 2030 (the “2030 Convertible Notes”). At September 30, 2025, the aggregate outstanding principal balance of the 2030 Convertible Notes was $40.0 million. The 2030 Convertible Notes were not outstanding as of December 31, 2024.

Current wording

On September 4, 2025, the Company entered into a note purchase agreement (the “2030 Note Purchase Agreement”), by and among the Company, and each purchaser named therein, in connection with the issuance and sale of $40.0 million aggregate principal of the Company’s 5.50% convertible notes due 2030 (the “2030 Convertible Notes”). At March 31, 2026 and December 31, 2025, the aggregate outstanding principal balance of the 2030 Convertible Notes was $16.5 million and $31.5 million, respectively.

Previous wording

Our operating activities provided cash of $30.1 million for the nine months ended September 30, 2024, and our financing activities used cash of $19.1 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, to repay our term debt securitization in connection with which an affiliate of us made an offering of $100.0 million in aggregate principal amount of fixed rate asset-backed notes that were issued in conjunction with the $157.8 million securitization of secured loans we completed on November 9, 2022 (the “2022 Asset-Backed Notes”) 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 $47.5 million.

Current wording

Our operating activities used cash of $42.1 million for the three months ended March 31, 2026, and our financing activities used cash of $27.3 million for the same period. Our operating activities used cash primarily to purchase investments in portfolio companies offset by cash provided by principal payments received on our debt investments. Our financing activities used cash primarily to repay our 2026 Notes and to pay distributions to our stockholders partially offset by advances on our Key Facility.

Previous wording

Our operating activities provided cash of $87.1 million for the nine months ended September 30, 2025, and our financing activities used cash of $57.0 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 the completion of our 2030 Convertible Notes, an advance on our Nuveen Facility and the sale of shares through our ATM for net proceeds of $14.2 million.

Current 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.

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 7.25% and 7.50% as of September 30, 2025 and December 31, 2024, respectively. The interest rate in effect was 7.35% and 7.60% as of September 30, 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 February 26, 2026, we amended the Key Facility, among other things, (i) to make Michael P. Balkin and Paul G. Seitz each an “Authorized Person”, (ii) to amend certain requirements to make a debt investment eligible for the borrowing base and (ii) to amend certain concentration limits. 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 an interest 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 6.75% as of March 31, 2026 and December 31, 2025. The interest rate in effect was 6.85% as of March 31, 2026 and December 31, 2025. 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

There were $181.0 million in notes issued to the NYL Noteholders as of September 30, 2025 and December 31, 2024 at an interest rate of 6.57% and 6.47%, respectively. As of September 30, 2025 and December 31, 2024, we had borrowing capacity under the NYL Facility of $69.0 million. At September 30, 2025 and December 31, 2024, $8.9 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 March 31, 2026 and December 31, 2025 at an interest rate of 6.57%. As of March 31, 2026 and December 31, 2025, we had borrowing capacity under the NYL Facility of $69.0 million. At March 31, 2026 and December 31, 2025, $2.6 million and $1.9 million, respectively, was available for borrowing, subject to existing terms and advance rates.

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 September 30, 2025 and December 31, 2024, there were approximately $1.1 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 March 31, 2026 and December 31, 2025, there were approximately $1.3 million and $1.1 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 September 30, 2025 and December 31, 2024 at an interest rate of 7.21% and 7.14%, respectively. As of September 30, 2025 and December 31, 2024, we had borrowing capacity under the Nuveen Facility of $110.0 million and $25.0 million. At September 30, 2025 and December 31, 2024, $0.6 million and $9.9 million, respectively, was available for borrowing, subject to existing terms and advance rates.

Current wording

There were $90.0 million in notes issued to the Nuveen Noteholders as of March 31, 2026 and December 31, 2025 at an interest rate of 7.21%. As of March 31, 2026 and December 31, 2025, we had borrowing capacity under the Nuveen Facility of $110.0 million. At March 31, 2026 and December 31, 2025, $22.3 million and $12.1 million, respectively, was available for borrowing, subject to existing terms and advance rates.

Previous wording

On March 30, 2021, we issued and sold an aggregate principal amount of $57.5 million of 4.875% notes due in 2026 (or the “2026 Notes”). The amount of 2026 Notes issued and sold included the full exercise by the underwriters of their option to purchase $7.5 million in aggregate principal of additional notes. The 2026 Notes have a stated maturity of March 30, 2026 and may be redeemed in whole or in part at our option at any time or from time to time on or after March 30, 2023 at a redemption price of $25 per security plus accrued and unpaid interest. The 2026 Notes bear interest at a rate of 4.875% per year, payable quarterly on March 30, June 30, September 30 and December 30 of each year. The 2026 Notes are our direct unsecured obligations and (i) rank equally in right of payment with our current and future unsecured indebtedness; (ii) are senior in right of payment to any of our future indebtedness that expressly provides it is subordinated to the 2026 Notes; (iii) are effectively subordinated to all of our existing and future secured indebtedness (including indebtedness that is initially unsecured to which we subsequently grant security), to the extent of the value of the assets securing such indebtedness, and (iv) are structurally subordinated to all existing and future indebtedness and other obligations of any of our subsidiaries. As of September 30, 2025, we were in material compliance with the terms of the 2026 Notes. The 2026 Notes are listed on the New York Stock Exchange under the symbol “HTFB”.

Current wording

On March 30, 2021, we issued and sold an aggregate principal amount of $57.5 million of 4.875% notes due in 2026. The amount of 2026 Notes issued and sold included the full exercise by the underwriters of their option to purchase $7.5 million in aggregate principal of additional notes. The 2026 Notes had a stated maturity of March 30, 2026 and could have been redeemed in whole or in part at our option at any time or from time to time on or after March 30, 2023 at a redemption price of $25 per security plus accrued and unpaid interest. The 2026 Notes bore interest at a rate of 4.875% per year, payable quarterly on March 30, June 30, September 30 and December 30 of each year. The 2026 Notes were our direct unsecured obligations and (i) ranked equally in right of payment with our current and future unsecured indebtedness; (ii) were senior in right of payment to any of our future indebtedness that expressly provides it is subordinated to the 2026 Notes; (iii) were effectively subordinated to all of our existing and future secured indebtedness (including indebtedness that is initially unsecured to which we subsequently grant security), to the extent of the value of the assets securing such indebtedness, and (iv) were structurally subordinated to all existing and future indebtedness and other obligations of any of our subsidiaries. The 2026 Notes were listed on the New York Stock Exchange under the symbol “HTFB”. On January 28, 2026, we redeemed all of the outstanding principal balance of the 2026 Notes plus accrued interest. We accelerated $0.1 million of unamortized debt issuance costs related to the 2026 Notes.

Previous wording

On September 4, 2025, we entered into the 2030 Note Purchase Agreement, by and among us and each purchaser named therein, in connection with the issuance and sale of $40.0 million aggregate principal of our 5.50% 2030 Convertible Notes. We received net proceeds (before expenses) from the sale of the 2030 Convertible Notes of approximately $36.6 million.

Current wording

On September 4, 2025, we entered into the 2030 Note Purchase Agreement, by and among us and each purchaser named therein, in connection with the issuance and sale of $40.0 million aggregate principal of our 5.50% 2030 Convertible Notes in a transaction exempt from registration pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended. We received net proceeds (before expenses) from the sale of the 2030 Convertible Notes of approximately $36.6 million.

Previous wording

The 2030 Convertible Notes mature on September 4, 2030, unless earlier converted or repurchased in accordance with their terms. The 2030 Convertible Notes bear interest at a rate of 5.50% per year, payable monthly in arrears on the last day of each calendar month, beginning on September 30, 2025.

Current wording

The 2030 Convertible Notes have a stated maturity of September 4, 2030, unless earlier converted or repurchased in accordance with their terms. The 2030 Convertible Notes bear interest at a rate of 5.50% per year, payable monthly in arrears on the last day of each calendar month, beginning on September 30, 2025.

Previous wording

Each holder of a 2031 Convertible Note has the right, at such holder’s option, to convert any such 2031 Convertible Note, at any time on or after April 17, 2025 and prior to the close of business on the business day immediately preceding the maturity date, into such number of shares of common stock of the Company equal to the principal balance of the 2031 Convertible Note being converted on the conversion date plus the accrued but unpaid interest on the 2031 Convertible Note as of the conversion date, divided by the greater of (i) volume-weighted average closing sale price for the five trading days immediately prior to the relevant conversion date, or (ii) our most recently reported NAV per share immediately prior to the date of exercise.

Current wording

Each holder of a 2030 Convertible Note has the right, at such holder’s option, to convert any such 2030 Convertible Note, at any time on or after October 4, 2025 and prior to the close of business on the business day immediately preceding the maturity date, into such number of shares of our common stock equal to the principal balance of the 2030 Convertible Note being converted on the conversion date plus the accrued but unpaid interest on the 2030 Convertible Note as of the conversion date, divided by the greater of (i) volume-weighted average closing sale price for the five trading days immediately prior to the relevant conversion date, or (ii) our most recently reported NAV per share immediately prior to the date of exercise.

Previous wording

During the three and nine months ended September 30, 2025, the holders of a portion of the 2031 Convertible Notes converted $4.8 million and $17.3 million, respectively in outstanding principal of the 2031 Convertible Notes plus accrued but unpaid interest on such outstanding principal as of the conversion date into 643,043 and 2,264,546 shares of common, respectively, stock at a weighted average conversion price of $7.43 and $7.69, respectively, together with cash in lieu of fractional shares, in accordance with noteholder conversion notice.

Current wording

During the three months ended March 31, 2026, the holders of a portion of the 2030 Convertible Notes converted $15.1 million in outstanding principal of the 2030 Convertible Notes plus accrued but unpaid interest on such outstanding principal as of the conversion date into 2,118,250 shares of common stock at a weighted average conversion price of $7.12 together with cash in lieu of fractional shares, in accordance with noteholder conversion notice.

Previous wording

The 2031 Convertible Notes mature on October 17, 2031, unless earlier converted or repurchased in accordance with their terms. The 2031 Convertible Notes bear interest at a rate of 7.125% per year, subject to additional interest or repurchase obligation upon certain events, payable quarterly in arrears on March 31, June 30, September 30 and December 31 of each year, beginning on December 31, 2024. If an investment grade rating is not maintained with respect to the 2031 Convertible Notes, additional interest of 1.00% per annum will accrue on the 2031 Convertible Notes until such time as the 2031 Convertible Notes have received an investment grade rating of “BBB-” (or its equivalent) or better. We will also be required to pay additional interest of 2.00% per annum (x) on any overdue payment of interest and (y) during the continuance of an Event of Default (as defined in the 2031 Note Purchase Agreement). In addition, on the occurrence of a Change in Control Repurchase Event (as defined in the 2031 Note Purchase Agreement) or Delisting Event (as defined in the 2031 Note Purchase Agreement), we will generally be required to make an offer to purchase the outstanding 2031 Convertible Notes at a price equal to 100% of the principal amount of such 2031 Convertible Notes plus accrued and unpaid interest to the repurchase date.

Current wording

The 2031 Convertible Notes have a stated maturity of October 17, 2031, unless earlier converted or repurchased in accordance with their terms. The 2031 Convertible Notes bear interest at a rate of 7.125% per year, subject to additional interest or repurchase obligation upon certain events, payable quarterly in arrears on March 31, June 30, September 30 and December 31 of each year, beginning on December 31, 2024. If an investment grade rating is not maintained with respect to the 2031 Convertible Notes, additional interest of 1.00% per annum will accrue on the 2031 Convertible Notes until such time as the 2031 Convertible Notes have received an investment grade rating of “BBB-” (or its equivalent) or better. We will also be required to pay additional interest of 2.00% per annum (x) on any overdue payment of interest and (y) during the continuance of an Event of Default (as defined in the 2031 Note Purchase Agreement). In addition, on the occurrence of a Change in Control Repurchase Event (as defined in the 2031 Note Purchase Agreement) or Delisting Event (as defined in the 2031 Note Purchase Agreement), we will generally be required to make an offer to purchase the outstanding 2031 Convertible Notes at a price equal to 100% of the principal amount of such 2031 Convertible Notes plus accrued and unpaid interest to the repurchase date.

Previous wording

Each holder of a 2030 Convertible Note has the right, at such holder’s option, to convert any such 2030 Convertible Note, at any time on or after October 4, 2025 and prior to the close of business on the business day immediately preceding the maturity date, into such number of shares of common stock of the Company equal to the principal balance of the 2030 Convertible Note being converted on the conversion date plus the accrued but unpaid interest on the 2030 Convertible Note as of the conversion date, divided by the greater of (i) volume-weighted average closing sale price for the five trading days immediately prior to the relevant conversion date, or (ii) our most recently reported NAV per share immediately prior to the date of exercise.

Current wording

Each holder of a 2031 Convertible Note has the right, at such holder’s option, to convert any such 2031 Convertible Note, at any time on or after April 17, 2025 and prior to the close of business on the business day immediately preceding the maturity date, into such number of shares of our common stock equal to the principal balance of the 2031 Convertible Note being converted on the conversion date plus the accrued but unpaid interest on the 2031 Convertible Note as of the conversion date, divided by the greater of (i) volume-weighted average closing sale price for the five trading days immediately prior to the relevant conversion date, or (ii) our most recently reported NAV per share immediately prior to the date of exercise.