Form 8-K - Current report

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934

 

Date of Report (Date of earliest event reported): October 9, 2024

 

HORIZON TECHNOLOGY FINANCE CORPORATION

(Exact name of registrant as specified in its charter)

Delaware		814-00802		27-2114934
(State or other jurisdiction of incorporation)		(Commission File Number)		(IRS Employer Identification No.)

 

312 Farmington Avenue

Farmington, CT 06032

 

(Address of principal executive offices and zip code)

 

Registrant’s telephone number, including area code: [phone]

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

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

 

Title of each class		Ticker Symbol(s)		Name of each exchange on which registered
Common Stock, par value $0.001 per share		HRZN		The Nasdaq Stock Market LLC
4.875% Notes due 2026		HTFB		The New York Stock Exchange
6.25% Notes due 2027		HTFC		The New York Stock Exchange

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).

 

Emerging growth company ☐

 

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

 

 

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Section 2	Financial Information
Item 2.02	Results of Operations and Financial Condition

 

On October 9, 2024, Horizon Technology Finance Corporation (the “Company”) issued a press release announcing its investment portfolio update for the three months ended September 30, 2024. A copy of this press release is attached hereto as Exhibit 99.1.

 

The information in Item 2.02 of this Current Report on Form 8-K, including Exhibit 99.1 furnished herewith, is being furnished and shall not be deemed “filed” for any purpose of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to liabilities of such Section. The information in this Current Report on Form 8-K shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

 

 

Section 9	Financial Statements and Exhibits
Item 9.01	Financial Statements and Exhibits

 

(d) Exhibits.

99.1	Press Release of the Company dated October 9, 2024.
104	Cover Page Interactive Data File (embedded within the Inline XBRL document)

   

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SIGNATURE

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: October 9, 2024	HORIZON TECHNOLOGY FINANCE CORPORATION
	By:	/s/ Robert D. Pomeroy, Jr.
		Robert D. Pomeroy, Jr.
		Chief Executive Officer

 

3

 

 

Horizon Technology Finance Provides Third Quarter 2024 Portfolio Update

 

- HRZN Originates $93.1 Million of New Loans in Q3 -

- HRZN Ends Quarter with Committed Backlog of $189.9 Million -

 

Farmington, Connecticut – October 9, 2024 – Horizon Technology Finance Corporation (NASDAQ: HRZN) (“HRZN” or “Horizon”), an affiliate of Monroe Capital, and a leading specialty finance company that provides capital in the form of secured loans to venture capital-backed companies in the technology, life science, healthcare information and services, and sustainability industries, today provided its portfolio update for the third quarter ended September 30, 2024 and an update on the lending platform (“Horizon Platform”) of Horizon Technology Finance Management LLC (“HTFM”), its investment adviser.

 

“We made excellent progress in the third quarter with respect to originating new, high-quality investments, as the venture environment continues to show improvement,” said Gerald A. Michaud, President of Horizon and HTFM. “For the quarter, we originated $93.1 million of loans, as our venture debt portfolio returned to meaningful growth. We also significantly increased our committed backlog to $189.9 million of debt investments, providing Horizon with a solid foundation for future lending opportunities. We continue to believe Horizon remains well positioned to deliver additional value to its shareholders.”

 

Third Quarter 2024 Portfolio Update

 

Originations

 

During the third quarter of 2024, HRZN funded a total of $93.1 million of loans, as follows:

 

●

$25.0 million to a new portfolio company, Hometeam Technologies, Inc. (dba Vesta Healthcare), a tech-enabled clinical services company that integrates caregivers, patients and the healthcare delivery system to monitor chronic conditions of high-risk patients.

●

$16.0 million to an existing portfolio company, Spineology, Inc., a developer of anatomy-conserving technology solutions for use in lumbar spinal fusion procedures.

●

$15.0 million to a new portfolio company, GT Medical Technologies, Inc., a developer of a proprietary solution to treat brain tumors.

●

$15.0 million to a new portfolio company, Infobionic, Inc., a developer of an FDA-cleared SaaS remote monitoring system to help treat cardiac arrythmia.

●

$10.0 million to a new portfolio company, Pivot Bio, Inc., a developer of natural microbial products that ensure crops receive essential nitrogen needed to grow.

●

$10.0 million to a new portfolio company, a developer of a connected digital supply chain for custom manufacturing that networks highly-vetted manufacturing partners around the globe.

●

$1.0 million to an existing portfolio company, Swift Health Systems, Inc. (dba InBrace), a developer of teeth straightening technology that provides an alternative to traditional braces and aligners.

●

$0.6 million to an existing portfolio company, a developer of a breathalyzer test to detect recent cannabis use.

●

$0.5 million to an existing affiliated portfolio company, a builder of conservation memorial forests that offer sustainable alternatives to cemeteries.

 

Liquidity Events and Partial Paydowns

 

HRZN experienced liquidity events from four portfolio companies in the third quarter of 2024, consisting of principal prepayments of $37.5 million, compared to $33.8 million of principal prepayments during the second quarter of 2024:

 

●

In July, MyForest Foods Co. (“MyForest Foods”) prepaid its outstanding principal balance of $3.8 million on its venture loan, plus interest, end-of-term payment and prepayment fee. HRZN continues to hold warrants in MyForest Foods.

●

In July, Lemongrass Holdings, Inc. (“Lemongrass”) prepaid its outstanding principal balance of $6.2 million on its venture loan, plus interest, end-of-term payment and prepayment fee. HRZN continues to hold warrants in Lemongrass.

●

In July, Slingshot Aerospace, Inc. (“Slingshot Aerospace”) prepaid its outstanding principal balance of $20.0 million on its venture loan, plus interest, end-of-term payment and prepayment fee. HRZN continues to hold warrants in Slingshot Aerospace.

●

In July, with the proceeds of a new loan from the Horizon Platform, Spineology paid its outstanding principal balance of $7.5 million on its venture loan, plus interest and end-of-term payment. HRZN continues to hold warrants in Spineology.

 

HRZN also received prepayments of principal from two portfolio companies in the aggregate amount of $1.8 million during the third quarter of 2024, compared to $11.4 million of prepayments of principal during the second quarter of 2024.

 

Principal Payments Received

 

During the third quarter of 2024, HRZN received regularly scheduled principal payments on investments totaling $12.4 million, compared to regularly scheduled principal payments totaling $11.8 million during the second quarter of 2024.

 

Commitments

 

During the quarter ended September 30, 2024, HRZN closed new loan commitments totaling $172.9 million to eight companies, compared to new loan commitments of $12.5 million to two companies in the second quarter of 2024.

 

Pipeline and Term Sheets

 

As of September 30, 2024, HRZN’s unfunded loan approvals and commitments (“Committed Backlog”) were $189.9 million to 16 companies. This compares to a Committed Backlog of $137.5 million to 13 companies at HRZN as of June 30, 2024. HRZN’s portfolio companies have discretion whether to draw down such commitments and the right of a portfolio company to draw down its commitment is often subject to achievement of specific milestones and other conditions to borrowing. Accordingly, there is no assurance that any or all of these transactions will be funded by HRZN.

 

During the quarter, HTFM received signed term sheets that are in the approval process, which may result in the Horizon Platform providing up to an aggregate of $35.0 million of new debt investments. These opportunities are subject to underwriting conditions including, but not limited to, the completion of due diligence, negotiation of definitive documentation and investment committee approval, as well as compliance with HTFM’s allocation policy. Accordingly, there is no assurance that any or all of these transactions will be completed or funded by HRZN.

 

Warrant and Equity Portfolio

 

As of September 30, 2024, HRZN held a portfolio of warrant and equity positions in 103 portfolio companies, including 92 private companies, which provides the potential for future additional returns to HRZN’s shareholders.

 

About Horizon Technology Finance

 

Horizon Technology Finance Corporation (NASDAQ: HRZN), externally managed by Horizon Technology Finance Management LLC, an affiliate of Monroe Capital, is a leading specialty finance company that provides capital in the form of secured loans to venture capital backed companies in the technology, life science, healthcare information and services, and sustainability industries. The investment objective of Horizon is to maximize its investment portfolio’s return by generating current income from the debt investments it makes and capital appreciation from the warrants it receives when making such debt investments. Horizon is headquartered in Farmington, Connecticut, with a regional office in Pleasanton, California, and investment professionals located throughout the U.S. Monroe Capital is a $19.5 billion asset management firm specializing in private credit markets across various strategies, including direct lending, technology finance, venture debt, opportunistic, structured credit, real estate and equity. To learn more, please visit horizontechfinance.com.

 

Forward-Looking Statements

Statements included herein may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Statements other than statements of historical facts included in this press release may constitute forward-looking statements and are not guarantees of future performance, condition or results and involve a number of risks and uncertainties. Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including those described from time to time in the Company’s filings with the Securities and Exchange Commission. Horizon undertakes no duty to update any forward-looking statement made herein. All forward-looking statements speak only as of the date of this press release.

 

Contacts:

 

Investor Relations:

ICR

Garrett Edson

[e-mail]

[phone]

 

Media Relations:

ICR

Chris Gillick

[e-mail]

[phone]         

 

Document And Entity Information	Oct. 09, 2024
Document Information [Line Items]
Entity, Registrant Name	HORIZON TECHNOLOGY FINANCE CORPORATION
Document, Type	8-K
Document, Period End Date	Oct. 09, 2024
Entity, Incorporation, State or Country Code	DE
Entity, File Number	814-00802
Entity, Tax Identification Number	27-2114934
Entity, Address, Address Line One	312 Farmington Avenue
Entity, Address, City or Town	Farmington
Entity, Address, State or Province	CT
Entity, Address, Postal Zip Code	06032
City Area Code	860
Local Phone Number	676-8654
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Entity, Emerging Growth Company	false
Amendment Flag	false
Entity, Central Index Key	0001487428
CommonStockParValue0001PerShare Custom [Member]
Document Information [Line Items]
Title of 12(b) Security	Common Stock, par value $0.001 per share
Trading Symbol	HRZN
Security Exchange Name	NASDAQ
NotesDue20264875 Custom [Member]
Document Information [Line Items]
Title of 12(b) Security	4.875% Notes due 2026
Trading Symbol	HTFB
Security Exchange Name	NYSE
NotesDue2027625 Custom [Member]
Document Information [Line Items]
Title of 12(b) Security	6.25% Notes due 2027
Trading Symbol	HTFC
Security Exchange Name	NYSE

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