PART I: FINANCIAL INFORMATION [Consolidated Financial Statements](index=3&type=section&id=Item%201.%20Consolidated%20Financial%20Statements) Net investment income grew YoY, but significant investment losses sharply reduced the net increase in net assets from operations [Consolidated Statements of Assets and Liabilities](index=4&type=section&id=Consolidated%20Statements%20of%20Assets%20and%20Liabilities) Total assets and net assets increased, while total liabilities and net asset value per share decreased from year-end 2022 Assets and Liabilities Comparison (in thousands) | Metric | June 30, 2023 | December 31, 2022 | Change | | :--- | :--- | :--- | :--- | | Total Investments at Fair Value | $715,391 | $720,026 | ($4,635) | | Total Assets | $787,408 | $766,826 | $20,582 | | Total Liabilities | $431,989 | $448,378 | ($16,389) | | Total Net Assets | $355,419 | $318,448 | $36,971 | - Net asset value (NAV) per common share decreased to **$11.07** as of June 30, 2023, from **$11.47** at the end of 2022[12](index=12&type=chunk) [Consolidated Statements of Operations](index=5&type=section&id=Consolidated%20Statements%20of%20Operations) Higher investment income was offset by a significant net realized loss, leading to a sharp decline in net asset growth Statement of Operations Highlights (in thousands, except per share data) | Metric | Q2 2023 | Q2 2022 | YTD 2023 | YTD 2022 | | :--- | :--- | :--- | :--- | :--- | | Total Investment Income | $28,117 | $18,588 | $56,154 | $32,792 | | Total Expenses | $11,865 | $9,900 | $26,707 | $18,275 | | Net Investment Income | $16,073 | $8,582 | $29,084 | $14,311 | | Net Realized and Unrealized Loss | ($15,921) | ($965) | ($23,626) | ($3,172) | | Net Increase in Net Assets | $152 | $7,617 | $5,458 | $11,139 | | Net Investment Income per Share | $0.54 | $0.35 | $1.00 | $0.62 | - For the three months ended June 30, 2023, the company experienced a significant net realized loss of **$16.5 million**, a primary driver of the sharp decline in the net increase in net assets[14](index=14&type=chunk) [Consolidated Statements of Changes in Net Assets](index=6&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Net%20Assets) Net assets grew primarily due to common stock issuances, which offset declared distributions and minimal operational gains - Total net assets increased from **$318.4 million** at December 31, 2022, to **$355.4 million** at June 30, 2023[17](index=17&type=chunk) - The increase in net assets was primarily driven by the issuance of common stock, which provided net proceeds of **$51.2 million**, and was partially offset by distributions declared of **$20.1 million**[17](index=17&type=chunk) [Consolidated Statements of Cash Flows](index=8&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Operating cash flow turned positive in H1 2023 due to a significant reduction in the purchase of new investments Cash Flow Summary for the Six Months Ended June 30 (in thousands) | Cash Flow Activity | 2023 | 2022 | | :--- | :--- | :--- | | Net Cash from Operating Activities | $7,246 | ($110,737) | | Net Cash from Financing Activities | $15,452 | $141,351 | | **Net Increase in Cash** | **$22,698** | **$30,614** | - The significant shift in operating cash flow was mainly due to a substantial decrease in the purchase of new investments (**$87.6 million** in 2023 vs **$253.7 million** in 2022)[20](index=20&type=chunk) [Consolidated Schedules of Investments](index=9&type=section&id=Consolidated%20Schedules%20of%20Investments) The investment portfolio is predominantly composed of debt investments, concentrated in the Life Science and Technology sectors Portfolio Composition by Investment Type at Fair Value (June 30, 2023) | Investment Type | Fair Value (in thousands) | Percentage of Total | | :--- | :--- | :--- | | Debt Investments | $683,309 | 95.5% | | Warrant Investments | $25,483 | 3.6% | | Equity Investments | $5,299 | 0.7% | | Other Investments | $1,300 | 0.2% | | **Total** | **$715,391** | **100.0%** | Portfolio Composition by Industry Sector at Fair Value (June 30, 2023) | Industry Sector | Fair Value (in thousands) | Percentage of Total | | :--- | :--- | :--- | | Life Science | $305,232 | 42.7% | | Technology | $290,138 | 40.5% | | Sustainability | $84,039 | 11.7% | | Healthcare Information & Services | $36,482 | 5.1% | | **Total** | **$715,891** | **100.0%** | - As of June 30, 2023, the company had two investments on non-accrual status with a total cost of **$25.6 million** and a fair value of **$15.3 million**[78](index=78&type=chunk) [Notes to the Consolidated Financial Statements](index=29&type=section&id=Notes%20to%20the%20Consolidated%20Financial%20Statements) Key disclosures include the company's BDC/RIC status, a change in investment advisor, and details on fees, leverage, and commitments - The company is an externally managed BDC that has elected to be treated as a RIC, focusing on secured debt investments in technology, life science, and other sectors[59](index=59&type=chunk) - The company's investment advisor was acquired by an affiliate of Monroe Capital LLC, effective June 30, 2023, with the economic terms of the management agreement remaining the same[108](index=108&type=chunk) - For Q2 2023, the incentive fee was subject to a cap and deferral mechanism, which reduced the period's expense by **$3.1 million**[117](index=117&type=chunk) - As of June 30, 2023, the company's asset coverage ratio was **184%**, above the required minimum of **150%** for a BDC[167](index=167&type=chunk) - The company had unfunded commitments to extend credit totaling **$143.4 million** as of June 30, 2023[190](index=190&type=chunk) - As of June 30, 2023, the company's undistributed spillover income was **$1.02 per share**[198](index=198&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=45&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses higher investment income driven by portfolio growth and rates, offset by significant realized losses on debt investments [Portfolio Composition and Investment Activity](index=47&type=section&id=Portfolio%20Composition%20and%20Investment%20Activity) The portfolio remains dominated by debt investments, with a notable decrease in net new debt investments compared to the prior year Portfolio Fair Value by Investment Type | Investment Type | June 30, 2023 (Value) | June 30, 2023 (%) | Dec 31, 2022 (Value) | Dec 31, 2022 (%) | | :--- | :--- | :--- | :--- | :--- | | Debt investments | $683,309 | 95.5% | $686,458 | 95.3% | | Warrants | $25,483 | 3.6% | $29,712 | 4.1% | | Other investments | $1,300 | 0.2% | $1,300 | 0.2% | | Equity | $5,299 | 0.7% | $2,556 | 0.4% | | **Total** | **$715,391** | **100.0%** | **$720,026** | **100.0%** | - Net new debt investments for the three months ended June 30, 2023, were **$40.5 million**, a significant decrease from **$134.2 million** in the same period of 2022[220](index=220&type=chunk) Debt Investment Portfolio by Credit Rating (Fair Value) | Credit Rating | June 30, 2023 (%) | Dec 31, 2022 (%) | | :--- | :--- | :--- | | 4 (Highest Quality) | 22.2% | 13.7% | | 3 (Standard Risk) | 67.3% | 81.2% | | 2 (Increased Risk) | 9.1% | 3.9% | | 1 (Deteriorating) | 1.4% | 1.2% | [Consolidated Results of Operations](index=49&type=section&id=Consolidated%20Results%20of%20Operations) Q2 2023 results show strong investment income growth, higher interest expenses, and a large net realized loss from portfolio company settlements - Q2 2023 investment income rose **51.3% YoY** to **$28.1 million**, driven by a larger average debt portfolio and a higher prime rate[225](index=225&type=chunk) - Q2 2023 expenses increased **19.8% YoY** to **$11.9 million**, driven by a **69.9%** rise in interest expense[229](index=229&type=chunk)[230](index=230&type=chunk) - Performance-based incentive fees for Q2 2023 decreased **94.5% YoY** to **$0.1 million** due to a **$3.1 million** reduction from the Incentive Fee Cap and Deferral Mechanism[232](index=232&type=chunk) - The company realized a net loss of **$16.5 million** in Q2 2023, primarily from the settlement of three debt investments[235](index=235&type=chunk) [Liquidity and Capital Resources](index=52&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintained liquidity through cash reserves and capital raising activities, including a follow-on offering and ATM program sales - As of June 30, 2023, the company had **$50.3 million** in cash and money market funds available for investments and operations[251](index=251&type=chunk) - In June 2023, the company completed a follow-on public offering of 3.25 million shares, raising net proceeds of **$38.9 million**[258](index=258&type=chunk) - During Q2 2023, the company sold 448,175 shares under its At-The-Market (ATM) program, generating net proceeds of approximately **$5.1 million**[253](index=253&type=chunk) - The Board extended a stock repurchase program allowing for the repurchase of up to **$5.0 million** of common stock; no shares were repurchased in H1 2023[260](index=260&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=61&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risk is interest rate risk, with floating-rate debt investments making income sensitive to rate changes - As of June 30, 2023, **95%** of the outstanding principal amount of the company's debt investments bore interest at floating rates[320](index=320&type=chunk) Annual Impact of Interest Rate Changes on Net Assets (in thousands) | Change in Basis Points | Impact on Investment Income | Impact on Interest Expense | Change in Net Assets | | :--- | :--- | :--- | :--- | | +300 | $19,026 | $0 | $19,026 | | +100 | $6,407 | $0 | $6,407 | | -100 | ($6,114) | $0 | ($6,114) | | -300 | ($17,400) | $0 | ($17,400) | - The company also faces risks from inflation and supply chain disruptions, which could negatively affect the profit margins of its portfolio companies[324](index=324&type=chunk) [Controls and Procedures](index=62&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective, with no material changes to internal controls during the quarter - Management, including the CEO and CFO, evaluated the company's disclosure controls and procedures as of June 30, 2023, and concluded they were **effective**[325](index=325&type=chunk) - **No material changes** were made to the company's internal control over financial reporting during the second quarter of 2023[326](index=326&type=chunk) PART II: OTHER INFORMATION [Legal Proceedings](index=62&type=section&id=Item%201.%20Legal%20Proceedings) The company reports no current or threatened material legal proceedings - As of the filing date, the company reports **no material legal proceedings**[327](index=327&type=chunk) [Risk Factors](index=62&type=section&id=Item%201A.%20Risk%20Factors) A new risk factor was added concerning uninsured cash balances at financial institutions and broader financial industry instability - A new risk factor was added concerning cash balances held in excess of **FDIC insurance limits** and financial industry instability[329](index=329&type=chunk) [Other Part II Items](index=63&type=section&id=Other%20Part%20II%20Items) No unregistered equity sales, senior security defaults, or other material information were reported for the period - Item 2 (Unregistered Sales of Equity Securities), Item 3 (Defaults Upon Senior Securities), and Item 5 (Other Information) all reported **"None"**[334](index=334&type=chunk)[335](index=335&type=chunk)[336](index=336&type=chunk) - Item 4 (Mine Safety Disclosures) was reported as **"Not applicable"**[336](index=336&type=chunk)

in, Corbel Bld., 16 pt., Bright Blue Investor Presentation – First Quarter 2023 NASDAQ: HRZN www.horizontechfinance.com ©2023 Horizon. Confidential and proprietary. ―Future operating results, including the performance of our existing loans and warrants; ―Introduction, withdrawal, success and timing of business initiatives and strategies; ―Changes in political, economic or industry conditions, the interest rate environment or financial and capital markets, which could result in changes in the value of our as ...

Horizon Technology Finance (NASDAQ:HRZN) Q1 2023 Earnings Conference Call May 3, 2023 9:00 AM ET Company Participants Megan Bacon – Director-Investor Relations and Marketing Rob Pomeroy – Chairman and Chief Executive Officer Jerry Michaud – President Dan Trolio – Chief Financial Officer Conference Call Participants Christopher Nolan – Ladenburg Thalmann Bryce Rowe – B. Riley Ryan Lynch – KBW Operator Good morning, ladies and gentlemen, and thank you for standing by. Welcome to the Horizon Technology Finance ...

Debt Investment Portfolio - As of March 31, 2023, 86.7% ($593.6 million) of the debt investment portfolio at fair value consisted of Senior Term Loans[208] - The total portfolio value decreased from $720.0 million on December 31, 2022, to $715.3 million on March 31, 2023[213] - New debt investments for the three months ended March 31, 2023, were $47.0 million, compared to $94.5 million for the same period in 2022[213] - The weighted average credit rating of debt investments was 3.0 as of March 31, 2023, down from 3.1 as of December 31, 2022[216] - The largest debt investments represented 23% of total debt investments outstanding as of March 31, 2023[215] - The portfolio included 57 debt investments valued at $684.6 million, with 70.6% rated 3 and 12.7% rated 2[216] - The debt investment in Biotechnology was valued at $183.6 million, representing 26.8% of the total portfolio[215] - As of March 31, 2023, total borrowings outstanding were $577.8 million, a decrease from $582.6 million as of December 31, 2022[244] - The Key Facility has a total commitment of $125 million, with an outstanding balance of $15 million as of March 31, 2023, and an unused commitment of $110 million[244] - The NYL Facility has an outstanding balance of $176.8 million as of March 31, 2023, with a borrowing capacity of $23.2 million remaining[250] - The 2019 Asset-Backed Notes had an outstanding principal balance of $37.8 million as of March 31, 2023, down from $42.6 million as of December 31, 2022[252] - The 2022 Asset-Backed Notes had an outstanding principal balance of $100 million as of both March 31, 2023, and December 31, 2022[255] - The 2026 Notes have a principal amount of $57.5 million and a fixed interest rate of 4.875%[257] - The 2027 Notes have a principal amount of $57.5 million and a fixed interest rate of 6.25%[258] - As of March 31, 2023, 96% of the outstanding principal amount of the company's debt investments bore interest at floating rates, compared to 100% as of December 31, 2022[291] Financial Performance - Total investment income increased by $13.8 million, or 97.4%, to $28.0 million for the three months ended March 31, 2023, compared to the same period in 2022[220] - Net investment income before excise tax rose to $13.2 million, up from $5.8 million, reflecting a significant increase of 126.5%[219] - Average debt investments at fair value increased by $228.2 million, or 49.7%, to $687.6 million for the three months ended March 31, 2023[220] - Total expenses increased by $6.5 million, or 77.2%, to $14.8 million for the three months ended March 31, 2023, compared to the same period in 2022[223] - Interest expense surged by $3.7 million, or 107.9%, to $7.1 million due to a 64.8% increase in average borrowings[224] - The dollar-weighted annualized yield on debt investments increased to 16.3% for the three months ended March 31, 2023, compared to 12.4% in 2022[221] - The company reported a net unrealized depreciation on investments of $7.5 million for the three months ended March 31, 2023[213] - Net unrealized depreciation on investments totaled $7.5 million for the three months ended March 31, 2023, compared to $2.2 million in 2022[230] Cash Flow and Shareholder Activities - Cash and investments in money market funds increased to $43.5 million as of March 31, 2023, up from $27.7 million at the end of 2022[231] - Operating activities provided cash of $12.7 million for the three months ended March 31, 2023, compared to a cash usage of $55.4 million in the same period of 2022[239] - The company sold 605,848 shares of common stock under the 2021 Equity Distribution Agreement, generating net proceeds of approximately $7.2 million[233] - The company sold 272,303 shares of common stock in April 2023, generating approximately $3.1 million in net proceeds, including $0.1 million in offering expenses[287] Economic and Market Conditions - The company anticipates potential impacts from economic factors such as inflation and supply chain disruptions on future performance[204] - Economic activity is accelerating, but inflation is showing signs of acceleration due to global supply chain issues and rising energy prices, which could affect profit margins of portfolio companies[296] - The company expects that a 300 basis point increase in interest rates could result in an increase in income by $19.44 million, while a decrease of 300 basis points could lead to a decrease in income by $18.33 million[292] - The company is currently assessing the impact of the FASB's Accounting Standards Update No. 2022-03 on its consolidated financial statements, effective for fiscal years beginning after December 15, 2023[290] Tax and Regulatory Compliance - To maintain RIC status, the company must distribute at least 90% of its net ordinary income and net short-term capital gains, which could impact the amount available for distribution if not met[265] - The company is required to distribute dividends to avoid corporate-level tax, including 98% of net ordinary income and 98.2% of capital gain net income for the calendar year[265] - The company is subject to a 4% excise tax on taxable income carried forward in excess of current year distributions[285] - The company had no material uncertain tax positions as of March 31, 2023, and December 31, 2022[286] Advisor and Management Fees - The Advisor earned $6.2 million in management fees during Q1 2023, compared to $3.7 million in Q1 2022, reflecting a significant increase of approximately 67.57% year-over-year[268] - The Advisor provides administrative services and office facilities, earning $0.4 million under the Administration Agreement during Q1 2023[271] - The Incentive Fee Cap for the three months ended March 31, 2023, resulted in a deferral of $0.2 million, with a total amount subject to recoupment of $1.3 million as of the same date[263] Valuation and Investment Strategy - The fair value of investments is determined by a Valuation Committee, with at least 25% of valuations subject to review by an independent valuation firm each fiscal quarter[275] - The company’s investments are categorized into a three-level fair value hierarchy, with Level 3 assets requiring significant management judgment for valuation[282] - The company did not recognize any interest income from debt investments on non-accrual status for the three months ended March 31, 2023, and 2022[278] - The company has utilized hedging instruments in the past to protect against interest rate fluctuations and may continue to do so in the future[293] - The company's net income is dependent on the difference between borrowing rates and investment rates, with rising interest rates potentially reducing net investment income[295] - The company intends to continue making requisite distributions to stockholders to qualify for tax treatment as a RIC, generally distributing at least 90% of its investment company taxable income[284] - The company has unfunded commitments of $166.2 million as of March 31, 2023, with no undrawn revolver commitments[261] - The company has restricted investments of approximately $1.3 million and $1.0 million as of March 31, 2023, and December 31, 2022, respectively[249] - The company has entered into a Membership Interest Purchase Agreement to sell its Advisor, with a significant portion of the consideration being earnout payments contingent on performance in 2023, 2024, and 2025[270]

Horizon Technology Finance Corp. (NASDAQ:HRZN) Q4 2022 Earnings Conference Call March 1, 2023 9:00 AM ET Company Participants Megan Bacon - Director of Investor Relations & Marketing Robert Pomeroy - Chairman & Chief Executive Officer Gerald Michaud - President & Director Daniel Trolio - Executive Vice President, Chief Financial Officer & Treasurer Conference Call Participants Ryan Lynch - KBW Bryce Rowe - B. Riley Vilas Abraham - UBS Operator Ladies and gentlemen greetings and welcome to the Horizon Techno ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-K (Mark One) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED DECEMBER 31, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM TO COMMISSION FILE NUMBER: 814-00802 HORIZON TECHNOLOGY FINANCE CORPORATION (Exact name of registrant as specified in its charter) | Delaware | 2 ...

Horizon Technology Finance Corp (NASDAQ:HRZN) Q3 2022 Earnings Conference Call November 2, 2022 9:00 AM ET Company Participants Megan Bacon - Director, IR & Marketing Robert Pomeroy - Chairman & CEO Gerald Michaud - President & Director Daniel Trolio - EVP, CFO & Treasurer Conference Call Participants Paul Johnson - KBW Vilas Abraham - UBS Operator Ladies and gentlemen, greetings, and welcome to the Horizon Technology Finance Corporation Third Quarter 2022 Earnings Call. [Operator Instructions]. As a remind ...

Horizon Technology Finance (NASDAQ:HRZN) Q2 2022 Earnings Conference Call August 3, 2022 9:00 AM ET Company Participants Megan Bacon - Director, Investor Relations & Marketing Rob Pomeroy - Chairman & Chief Executive Officer Jerry Michaud - President Dan Trolio - Chief Financial Officer Conference Call Participants Paul Johnson - KBW Megan Bacon Thank you and welcome to Horizon Technology Finance Corporation Second Quarter 2022 Conference Call. Representing the company today are Rob Pomeroy, Chairman and Ch ...

Debt Investments - As of June 30, 2022, the total debt investment portfolio at fair value was $551.6 million, representing 95.5% of the total portfolio[193] - New debt investments for the three months ended June 30, 2022, amounted to $159.2 million, compared to $67.3 million in the same period of 2021, reflecting a 136% increase[193] - The ending portfolio value as of June 30, 2022, was $577.5 million, up from $404.1 million as of December 31, 2021, indicating a growth of 42.8%[193] - The five largest debt investments represented 22% of total debt investments outstanding as of June 30, 2022, compared to 26% as of December 31, 2021[196] - The company’s debt investments in the biotechnology sector totaled $130.3 million, accounting for 23.6% of the total debt investments as of June 30, 2022[195] - As of June 30, 2022, 76.2% of debt investments were rated 3, indicating a standard level of risk[197] - The dollar-weighted annualized yield on debt investments decreased to 13.4% for the six months ended June 30, 2022 from 15.0% in the same period in 2021[214] - As of June 30, 2022, 100% of the outstanding principal amount of the company's debt investments bore interest at floating rates[289] Investment Income and Expenses - Total investment income increased by $5.1 million, or 37.8%, to $18.6 million for the three months ended June 30, 2022 compared to the same period in 2021[200] - Interest income on debt investments rose by $5.2 million, or 42.0%, to $17.7 million for the three months ended June 30, 2022, driven by a $155.8 million, or 42.5%, increase in the average size of the debt investment portfolio[200] - Total expenses increased by $2.6 million, or 35.2%, to $9.9 million for the three months ended June 30, 2022 compared to the same period in 2021[203] - Interest expense increased by $1.3 million, or 43.0%, to $4.2 million for the three months ended June 30, 2022, primarily due to a $104.5 million, or 47.5%, increase in average borrowings[204] - Net investment income for the three months ended June 30, 2022 was $8.6 million, compared to $6.1 million for the same period in 2021[200] - For the six months ended June 30, 2022, total investment income increased by $6.1 million, or 22.8%, to $32.8 million compared to the same period in 2021[213] - Total expenses for the six months ended June 30, 2022 increased by $3.8 million, or 26.3%, to $18.3 million compared to the same period in 2021[215] - Base management fee expense increased by $1.2 million, or 32.5%, to $4.8 million for the six months ended June 30, 2022 due to the increase in average debt investments[217] Cash and Financing Activities - As of June 30, 2022, the company had cash and investments in money market funds totaling $76.3 million, up from $45.9 million as of December 31, 2021[224] - Operating activities used cash of $110.7 million for the six months ended June 30, 2022, while financing activities provided cash of $141.4 million for the same period[233] - The company expects to raise additional equity and debt capital opportunistically to support future growth[235] - The company believes that current cash and cash generated from operations will be sufficient to meet working capital and capital expenditure commitments for at least the next 12 months[237] Debt Issuance and Obligations - The company issued $57.5 million of 4.875% notes due in 2026, with a stated maturity of March 30, 2026, and may be redeemed at a price of $25 per security plus accrued interest[243] - An additional $50.0 million of 6.25% notes due in 2027 were issued, with a total of $7.5 million sold under the underwriters' option, maturing on June 15, 2027[244] - The outstanding principal balance under the Key Facility was $74.5 million as of June 30, 2022, compared to $53.5 million as of December 31, 2021[231] - The outstanding principal balance under the NYL Facility increased to $136.8 million as of June 30, 2022, from $78.8 million as of December 31, 2021[232] - Total contractual obligations as of June 30, 2022, amounted to $558.05 million, including $368.55 million in borrowings and $189.5 million in unfunded commitments[254] - The company is required to maintain a reserve cash balance, with approximately $0.9 million classified as restricted investments as of June 30, 2022[251] Investment Performance - The company realized net losses on investments totaling $0.9 million, an improvement from net losses of $3.7 million for the same period in 2021[222] - Net unrealized depreciation on investments for the six months ended June 30, 2022, was $2.3 million, compared to net unrealized appreciation of $4.7 million for the same period in 2021[223] - The company received principal payments of $6.96 million on investments for the six months ended June 30, 2022, down from $8.08 million in the same period of 2021[193] Economic Outlook - Economic activity is accelerating across sectors and regions, but inflation is showing signs of acceleration in the U.S. and globally due to supply chain issues and rising energy prices[295] - Inflation is likely to continue in the near to medium-term, particularly in the U.S., which may lead to tighter monetary policy[295] - Persistent inflationary pressures could affect profit margins of portfolio companies[295] Tax and Regulatory Compliance - The company has made requisite distributions to stockholders to qualify for tax treatment applicable to RICs, generally distributing at least 90% of investment company taxable income[280] - The company evaluates tax positions to determine if they are "more-likely-than-not" to be sustained, with no material uncertain tax positions reported as of June 30, 2022[282] Advisor and Management Fees - The Advisor earned $4.7 million and $8.3 million during the three and six months ended June 30, 2022, respectively, under the Investment Management Agreement[264] Shareholder Activities - During the three months ended June 30, 2022, the company sold 868,230 shares of common stock under the 2021 Equity Distribution Agreement, generating net proceeds of approximately $10.3 million[227] - For the six months ended June 30, 2022, the company sold 1,118,401 shares of common stock under the 2021 Equity Distribution Agreement, resulting in net proceeds of approximately $14.2 million[229] - The company has adopted a dividend reinvestment plan (DRIP) for common stockholders, allowing cash distributions to be automatically reinvested unless opted out[261]

Horizon Technology Finance (NASDAQ:HRZN) Q1 2022 Earnings Conference Call May 4, 2022 9:00 AM ET Company Participants Megan Bacon - Director of IR and Marketing Rob Pomeroy - Chairman and CEO Jerry Michaud - President Dan Trolio - CFO Conference Call Participants Paul Johnson - KBW Operator Greetings, and welcome to Horizon Technology Finance Corporation First Quarter 2022 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal ...