# Horizon Technology Finance Corp: Form 10-Q for the period ended Jun 30, 2026

- Company: [Horizon Technology Finance Corp](/companies/hrzn.md) (CIK 1487428)
- Form: 10-Q
- Filed: 2026-08-04
- Accepted by EDGAR: Aug 4, 2026, 16:53 ET
- Period: 2026-06-30
- Accession: 0001437749-26-025689
- Inline XBRL: yes
- Main document: https://www.sec.gov/Archives/edgar/data/1487428/000143774926025689/hrzn20260630_10q.htm
- All documents and exhibits: https://www.sec.gov/Archives/edgar/data/1487428/000143774926025689/

## Figures reported in this filing

Standardized XBRL line items for the period ended 2026-06-30.

| Line item | Period | Value | XBRL concept |
| --- | --- | ---: | --- |
| Interest expense | 3 months, 2026-04-01 to 2026-06-30 | $7.8m | us-gaap:InterestExpense |
| Interest expense | 6 months, 2026-01-01 to 2026-06-30 | $16.0m | us-gaap:InterestExpense |
| Net income | 3 months, 2026-04-01 to 2026-06-30 | −$37.3m | us-gaap:NetIncomeLoss |
| Net income | 6 months, 2026-01-01 to 2026-06-30 | −$34.5m | us-gaap:NetIncomeLoss |
| Diluted EPS | 3 months, 2026-04-01 to 2026-06-30 | −$0.57 | us-gaap:EarningsPerShareDiluted |
| Diluted EPS | 6 months, 2026-01-01 to 2026-06-30 | −$0.61 | us-gaap:EarningsPerShareDiluted |
| Basic EPS | 3 months, 2026-04-01 to 2026-06-30 | −$0.57 | us-gaap:EarningsPerShareBasic |
| Basic EPS | 6 months, 2026-01-01 to 2026-06-30 | −$0.61 | us-gaap:EarningsPerShareBasic |
| Diluted shares (weighted) | 3 months, 2026-04-01 to 2026-06-30 | 64,974,577 shares | us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding |
| Diluted shares (weighted) | 6 months, 2026-01-01 to 2026-06-30 | 56,194,386 shares | us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding |
| Operating cash flow | 6 months, 2026-01-01 to 2026-06-30 | $81.4m | us-gaap:NetCashProvidedByUsedInOperatingActivities |
| Dividends paid | 6 months, 2026-01-01 to 2026-06-30 | $25.2m | us-gaap:PaymentsOfDividends |
| Share repurchases | 6 months, 2026-01-01 to 2026-06-30 | $6.2m | us-gaap:PaymentsForRepurchaseOfCommonStock |
| Cash and equivalents | at 2026-06-30 | $75.0m | us-gaap:Cash |
| Total assets | at 2026-06-30 | $832.0m | us-gaap:Assets |
| Total liabilities | at 2026-06-30 | $414.5m | us-gaap:Liabilities |
| Long-term debt | at 2026-06-30 | $402.4m | us-gaap:LongTermDebt |
| Shareholders' equity | at 2026-06-30 | $417.5m | us-gaap:StockholdersEquity |

## Management's discussion and analysis

As filed, 104,403 characters.

*In this quarterly report on Form 10‑Q, except where the context suggests otherwise, the terms “we,” “us,” “our” and “Horizon Technology Finance” refer to Horizon Technology Finance Corporation and its consolidated subsidiaries. The information contained in this section should be read in conjunction with our consolidated financial statements and related notes thereto appearing elsewhere in this quarterly report on Form 10‑Q.*

### Forward-looking statements

This quarterly report on Form 10‑Q, including the Management’s Discussion and Analysis of Financial Condition and Results of Operations, contains statements that constitute forward-looking statements, which relate to future events or our future performance or financial condition. These forward-looking statements are not historical facts, but rather are based on current expectations, estimates and projections about our industry, our beliefs and our assumptions. The forward-looking statements contained in this quarterly report on Form 10‑Q involve risks and uncertainties, including statements as to:

- our future operating results, including the performance of our existing debt investments, warrants and other investments;
- the introduction, withdrawal, success and timing of business initiatives and strategies;
- the consummation of the transactions contemplated by our merger with MRCC (as defined below);
- general economic and political trends and other external factors, including continuing supply chain disruptions, increased inflation, increased energy costs, tariffs and trade disputes with other countries and a general slowdown in economic activity;
- our business prospects and the prospects of our portfolio companies;
- the impact of changes in laws or regulations (including the interpretation thereof), including tax laws, governing our operations or the operations of our portfolio companies or the operations of our competitors;
- the relative and absolute investment performance and operations of our Advisor;
- the impact of increased competition;
- the impact of investments we intend to make and future acquisitions and divestitures;
- the unfavorable resolution of legal proceedings;
- geopolitical turmoil, such as the conflicts between Russia and Ukraine, conflicts in the Middle East and Iran, and the potential for volatility in energy prices and disruptions to global supply chains resulting from such turmoil and its impact on the industries in which we invest;
- political and regulatory conditions that contribute to uncertainty and market volatility, including legislative, regulatory, trade and policy changes;
- the impact on our business of a U.S. government shutdown;
- the impact, extent and timing of technological changes and the adequacy of intellectual property protection;
- our regulatory structure and tax status;
- changes in the general interest rate environment;
- our ability to qualify and maintain qualification as a RIC and as a BDC;
- the adequacy of our cash resources and working capital;
- any losses or operations disruptions caused by us, our Advisor or our portfolio companies holding cash balances at financial institutions that exceed federally insured limits or by disruptions in the financial services industry;
- the timing of cash flows, if any, from the operations of our portfolio companies, and the resulting effect on our portfolio companies' decisions to make payment-in-kind (“PIK”) interest payments or ability to make end of term payments;
- the impact of interest rate volatility on our results, particularly if we use leverage as part of our investment strategy;
- the ability of our portfolio companies to achieve their objective;
- the impact of legislative and regulatory actions and reforms and regulatory supervisory or enforcement actions of government agencies relating to us or our Advisor;
- our contractual arrangements and relationships with third parties;
- our ability to access capital and any future financings by us;
- our use of financial leverage;
- the ability of our Advisor to attract and retain highly talented professionals;
- the impact of changes to tax legislation and, generally, our tax position; and
- our ability to fund unfunded commitments, including those of a new joint venture, RoHo Capital Opportunity Fund LLC f/k/a HRZN CRFH LLC (the “RoHo Joint Venture”) formed by us and CR Financial Holdings, Inc. (“CRFH”), to the extent approved by each member of the RoHo Joint Venture.

We use words such as “anticipates,” “believes,” “expects,” “intends,” “seeks” and similar expressions to identify forward-looking statements. Undue influence should not be placed on the forward-looking statements as our actual results could differ materially from those projected in the forward-looking statements for any reason, including the factors in “Risk Factors” and elsewhere in our annual report on Form 10‑K for the year ended December 31, 2025, and elsewhere in this quarterly report on Form 10‑Q.

We have based the forward-looking statements included in this quarterly report on Form 10-Q on information available to us on the date of this quarterly report on Form 10-Q, and we assume no obligation to update any such forward-looking statements. Although we undertake no obligation to revise or update any forward-looking statements in this quarterly report on Form 10‑Q, whether as a result of new information, future events or otherwise, you are advised to consult any additional disclosures that we may make directly to you or through reports that we in the future may file with the U.S. Securities and Exchange Commission, or the SEC, including periodic reports on Form 10‑Q and Form 10‑K and current reports on Form 8‑K.

You should understand that under Sections 27A(b)(2)(B) and (D) of the Securities Act and Sections 21E(b)(2)(B) and (D) of the Exchange Act, the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995 do not apply to statements made in connection with any annual or quarterly reports we file under the Exchange Act.

### Overview

We are a specialty finance company that lends to and invests in development-stage companies in the technology, life science, healthcare information and services and sustainability industries, which we refer to as our “Target Industries.” Our investment objective is to maximize our investment portfolio’s total return by generating current income from the debt investments we make and capital appreciation from the warrants we receive when making such debt investments. We are focused on making secured debt investments, which we refer to collectively as “Venture Loans,” to venture capital and private equity backed companies and publicly traded companies in our Target Industries, which we refer to as “Venture Lending.” Our debt investments are typically secured by first liens or first liens behind a secured revolving line of credit, or collectively “Senior Term Loans.” Some of our debt investments may also be subordinated to term debt provided by third parties. As of June 30, 2026, 97.7%, or $633.3 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.

We are an externally managed, closed-end, non-diversified management investment company that has elected to be regulated as a BDC under the Investment Company Act of 1940, as amended, or the 1940 Act. In addition, for U.S. federal income tax purposes, we have elected to be treated as a RIC under Subchapter M of the Code. As a BDC, we are required to comply with regulatory requirements, including limitations on our use of debt. We are permitted to, and expect to, finance our investments through borrowings subject to a 150% asset coverage test. In accordance with GAAP, any borrowings of the RoHo Joint Venture are not included in the asset coverage test. As defined in the 1940 Act, asset coverage of 150% means that for every $100 of net assets a BDC holds, it may raise up to $200 from borrowing and issuing senior securities. The amount of leverage that we may employ will depend on our assessment of market conditions and other factors at the time of any proposed borrowing. As a RIC, we generally are not subject to corporate-level income taxes on our investment company taxable income, determined without regard to any deductions for dividends paid, and our net capital gain that we distribute as dividends for U.S. federal income tax purposes to our stockholders as long as we meet certain source-of-income, distribution, asset diversification and other requirements.

We were formed in March 2010 and completed an initial public offering in October 2010.

Our investment activities, and our day-to-day operations, are managed by our Advisor and supervised by our Board, of which a majority of the members are independent of us. Under the Investment Management Agreement, we have agreed to pay our Advisor a base management fee and an incentive fee for its advisory services to us. We have also entered into the Administration Agreement with our Advisor under which we have agreed to reimburse our Advisor for our allocable portion of overhead and other expenses incurred by our Advisor in performing its obligations under the Administration Agreement.

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”) (the “Merger”). Former MRCC stockholders and legacy stockholders own 29.86% and 70.14% of the combined company, respectively, immediately following the closing of the Merger.

### Portfolio composition and investment activity

The following table shows our portfolio by type of investment as of June 30, 2026 and December 31, 2025:

*(Dollars in thousands)*

|  | June 30, 2026 Number of Investments | Fair Value | Percentage of Total Portfolio | December 31, 2025 Number of Investments | Fair Value | Percentage of Total Portfolio |
| --- | ---: | ---: | ---: | ---: | ---: | ---: |
| Debt investments | 43 | $647,999 | 95.8% | 38 | $596,025 | 92.1% |
| Warrants | 72 | 16,703 | 2.5 | 72 | 16,648 | 2.6 |
| Other investments | 8 | 4,037 | 0.6 | 8 | 3,444 | 0.5 |
| Equity | 16 | 7,757 | 1.1 | 17 | 31,127 | 4.8 |
| Equity in RoHo Joint Venture | 1 | 215 | — |  | — |  |
| Total |  | $676,711 | 100.0% |  | $647,244 | 100.0% |

The following table shows total portfolio investment activity as of and for the three and six months ended June 30, 2026 and 2025:

*(In thousands)*

|  | For the three months ended June 30, 2026 | 2025 | For the six months ended June 30, 2026 | 2025 |
| --- | ---: | ---: | ---: | ---: |
| Beginning portfolio | $695,697 | $689,553 | $647,244 | $697,891 |
| New debt and equity investments | 72,762 | 59,869 | 192,766 | 162,308 |
| Less refinanced debt balances | — | (17,500) | (30,000) | (46,250) |
| Net new debt and equity investments | 72,762 | 42,369 | 162,766 | 116,058 |
| Principal payments received on investments | (5,503) | (15,659) | (10,387) | (26,830) |
| Early pay-offs and principal paydowns | (41,620) | (62,834) | (74,784) | (102,408) |
| PIK interest on investments | 1,566 | 243 | 2,844 | 528 |
| Accretion of debt investment fees | 2,823 | 1,909 | 4,442 | 3,298 |
| New debt investment fees | (2,720) | (700) | (4,305) | (1,504) |
| Warrants received in settlement of fee income | — | 5 | — | 10 |
| Proceeds from sale of investments | (1,904) | (783) | (2,008) | (784) |
| Investment in RoHo Joint Venture | 215 | — | 215 | — |
| Net realized loss on investments | (6,122) | (9,294) | (6,283) | (9,293) |
| Net unrealized depreciation on investments | (38,533) | (22,156) | (43,133) | (54,313) |
| Other | 50 | — | 100 | — |
| Ending portfolio | $676,711 | $622,653 | $676,711 | $622,653 |

We receive payments on our debt investments based on scheduled amortization of the outstanding balances. In addition, we receive repayments of some of our debt investments prior to their scheduled maturity date. The frequency or volume of these repayments may fluctuate significantly from period to period.

The following table shows our debt investments by industry sector as of June 30, 2026 and December 31, 2025:

*(Dollars in thousands)*

| Life Science | June 30, 2026 Debt Investments at Fair Value | Percentage of Total Portfolio | December 31, 2025 Debt Investments at Fair Value | Percentage of Total Portfolio |
| --- | ---: | ---: | ---: | ---: |
| Biotechnology | $82,455 | 12.7% | $57,753 | 9.7% |
| Medical Device | 223,222 | 34.4 | 213,523 | 35.8 |
| Technology |  |  |  |  |
| Communications | 5,772 | 0.9 | — | — |
| Consumer-Related | 15,617 | 2.5 | 17,263 | 2.9 |
| Software | 224,007 | 34.6 | 185,534 | 31.1 |
| Sustainability |  |  |  |  |
| Alternative Energy | — | — | 4,869 | 0.8 |
| Other Sustainability | 18,151 | 2.8 | 29,563 | 5.0 |
| Healthcare Information and Services |  |  |  |  |
| Diagnostics | 6,749 | 1.0 | 6,605 | 1.1 |
| Other Healthcare | 29,840 | 4.6 | 34,469 | 5.8 |
| Software | 42,186 | 6.5 | 46,446 | 7.8 |
| Total | $647,999 | 100.0% | $596,025 | 100.0% |

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 June 30, 2026 and December 31, 2025, respectively. Our five largest debt investments at fair value represented 25% and 26% of total debt investments outstanding as of June 30, 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 June 30, 2026 and December 31, 2025.

### Debt investment asset quality

We use an internal credit rating system to assess the credit risk of each debt investment in our portfolio. Our internal credit rating system is not a national credit rating system and is not intended to be comparable to ratings issued by any nationally recognized statistical rating organization. See “Item 1 — Business” in our Annual Report on Form 10-K for the year ended December 31, 2025, as updated below under “*Update to Internal Credit Rating Methodology,”* for a more detailed description of the internal credit rating system.

Effective June 30, 2026, we changed our internal credit rating scale to adopt the scale used by our affiliate Monroe Capital LLC, and its affiliates. We made this change in order to improve consistency and efficiency in portfolio risk assessment by the affiliated entities, with whom we have made, and we anticipate we will continue to make, co-investments. Accordingly, our internal credit rating methodology was changed from a 4-to-1 scale (on which a 4 represented the highest credit quality) to a 1-to-5 scale (on which a 1 represents the highest credit quality). For comparability, credit rating disclosures for prior periods presented herein have been recast to conform to the updated 1-to-5 scale. The recast was performed by our investment adviser by applying the revised rating definitions and criteria to the facts and circumstances of each portfolio company as they existed at each prior reporting date, using information available to the adviser at that time. The recast is a reclassification for presentation and comparability purposes only. It does not reflect any change in the underlying credit quality, fair value, cost basis, non-accrual status, income recognition, or financial condition of any portfolio company as of any prior reporting date, and it did not affect our previously reported net assets, net increase (decrease) in net assets resulting from operations, or fair value measurements.

Credit rating information for periods prior to June 30, 2026, as originally reported on the prior 4-to-1 scale can be found in our Annual Report on Form 10-K for the year ended December 31, 2025 and in our Quarterly Reports on Form 10-Q for periods ending prior to June 30, 2026.

### Update to internal credit rating methodology

The updated methodology is administered by our investment adviser using the same portfolio management and reporting process described in "Item 1 — Business — Portfolio Management and Reporting" of our Annual Report on Form 10-K for the year ended December 31, 2025. That process is substantively unchanged, including without limitation; (i) at least quarterly, our Advisor contacts each portfolio company, no less than once a quarter, for operational and financial updates and performs reviews with portfolio companies that we deem to have greater credit risk on a monthly or more frequent basis; and (ii) our Advisor requires all private portfolio companies to provide financial statements, typically monthly, and relies on publicly reported quarterly financials for public portfolio companies.

Under the updated credit scale system, each debt investment is rated on a 1 through 5 scale, with 2 representing the rating for an acceptable level of risk. A rating of 1 represents a portfolio company that is exhibiting the lowest level of risk and is exceeding expectations. Newly funded investments are typically assigned a rating of 2. A rating of 3 represents investments performing below expectations and indicates that the risk has increased somewhat since origination. A rating of 4 or 5 represents a deteriorating credit quality and an increased risk of loss of principal. Investment ratings are generated internally by our Advisor, and we cannot guarantee that others would assign the same ratings to our portfolio investments or similar portfolio investments. Our Advisor closely monitors portfolio companies rated a 4 or 5 for adverse developments. In addition, our Advisor maintains regular contact with the management, board of directors and major equity holders of these portfolio companies in order to discuss strategic initiatives to correct the deterioration of the portfolio company.

The ratings under our updated internal credit rating system are defined as follows:

| Rating |  |
| ---: | --- |
| 1 | Investments exhibiting the lowest level of risk. The portfolio company is generally significantly exceeding expectations or the company's operating trends and risk factors are generally positive. The company is generally expected to fully repay its loan in the near term as a result of strong performance. |
| 2 | Investments exhibiting an acceptable level of risk, typically the same level of risk at the time of the investment’s origination. The company is generally performing as expected or the risk factors are neutral to positive. |
| 3 | Investments performing below expectations and indicates that the investment’s risk has increased since origination, but not materially. The portfolio company may have underperforming operations results, with reduced enterprise value coverage, tightening liquidity or may face challenges raising capital; however, loan payments are generally current. |
| 4 | Investments performing materially below expectations and indicates that the portfolio company’s risk has increased materially since origination. The portfolio company may have limited liquidity, constrained access to capital, an enterprise value near or below the outstanding loan balance, may be out of compliance with covenants and/or past due on payments. For grade 4 investments, we typically increase the monitoring of the company. |
| 5 | Investments performing substantially below expectations with severe deterioration in credit quality. The portfolio company typically has insufficient liquidity, enterprise value below the loan balance, limited access to capital, or maybe in payment default or restructuring. Investments graded 5 are not anticipated to be repaid in full, and we will reduce the estimate fair value of the loan to the amount we expect to recover. |

### Rating upon adoption

In the second quarter of 2026, in connection with the adoption of the new 1-5 credit rating scale, our Advisor (i) rated all debt investments as of June 30, 2026 under the new 1-to-5 scale and (ii) recast the credit ratings of the debt investments for all of the prior periods presented in this Quarterly Report to the new 1-to-5 scale. The ratings and recast ratings in this Quarterly Report are made based on the same proprietary credit assessment process our Advisor regularly utilizes on a quarterly basis, as applied to the facts and circumstances existing at the applicable reporting date.

Under the updated 1-to-5 scale, our debt investments had a weighted average credit rating of 2.3 as of June 30, 2026. On a recast basis, our debt investments had a weighted average credit rating of 2.4 as of December 31, 2025. Weighted average credit ratings previously reported on the 4-to-1 scale (2.9 as of December 31, 2025) are not directly comparable to ratings under the updated scale due to the change in credit rating methodology.

The following table shows the classification of our debt investment portfolio by internal credit rating, in each case presented under the updated 1-to-5 scale, as of June 30, 2026 and December 31, 2025 (recast):

*(Dollars in thousands)*

| Credit Rating | June 30, 2026 Number of Investments | Debt Investments at Fair Value | Percentage of Debt Investments | December 31, 2025 Number of Investments | Debt Investments at Fair Value | Percentage of Debt Investments |
| ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| 1 | — | $— | —% | — | $— | —% |
| 2 | 32 | 547,063 | 84.4 | 28 | 471,116 | 79.0 |
| 3 | 2 | 21,606 | 3.3 | 2 | 46,887 | 7.9 |
| 4 | 4 | 47,991 | 7.4 | 4 | 53,503 | 9.0 |
| 5 | 5 | 31,339 | 4.9 | 4 | 24,519 | 4.1 |
| Total | 43 | $647,999 | 100.0% | 38 | $596,025 | 100.0% |

As of June 30, 2026, there were five debt investments with an internal credit rating of 5, with an aggregate cost of $58.0 million and an aggregate fair value of $31.3 million and there were four debt investments with an internal credit rating of 4, with an aggregate cost of $57.1 million and an aggregate fair value of $48.0 million. On a recast basis as of December 31, 2025, there were four debt investments with an internal credit rating of 5 (previously reported as rating 1 on the prior 4-to-1 scale), 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 4 (previously reported as rating 2 on the prior 4-to-1 scale), with an aggregate cost of $56.8 million and an aggregate fair value of $53.5 million. The period-over-period change in investments with internal credit ratings of 4 or 5 was primarily a result of the increase in the risk of loss of principal caused by certain portfolio companies' low cash positions, the difficult equity fundraising market, and/or the underperformance of such portfolio companies. This period-over-period change reflects underlying credit developments and is not attributable to the methodology change described above.

### RoHo Capital Opportunity LLC

On March 18, 2026, we and CRFH entered into an LLC Agreement to form the RoHo Joint Venture. The RoHo Joint Venture is intended to enhance our investment strategy by providing growth capital financing solutions to small and micro-cap public companies.

We have committed to invest up to $87.5 million in the RoHo Joint Venture and CRFH has committed to invest up to $12.5 million in the RoHo Joint Venture. Investments by each of us and CRFH in the RoHo Joint Venture will be made in the form of membership interests. All investments by the RoHo Joint Venture must be approved by the unanimous vote of the RoHo Joint Venture’s investment committee, which is comprised of an equal number of representatives designated by each of us and CRFH. Further, all other decisions regarding the management of the RoHo Joint Venture require the approval of the majority of the RoHo Joint Venture’s board of directors, which is comprised of an equal number of representatives from each us and CRFH.

As of June 30, 2026, no investments were made by the RoHo Joint Venture. The following tables show certain summarized financial information for the RoHo Joint Venture as of June 30, 2026 and for the three months ended June 30, 2026 and for the period March 18, 2026 through June 30, 2026:

| Assets | June 30, 2026 |
| --- | ---: |
| Investments in money market funds | 200 |
| Contributions receivable | 430 |
| **Total assets** | $630 |
| **Liabilities** |  |
| Other liabilities | 630 |
| **Total liabilities** | 630 |
| Commitments and contingencies |  |
| Members’ Capital |  |
| Members’ capital | — |
| Total members’ capital | — |
| Total liabilities and members’ capital | $630 |

*(In thousands)*

| Selected Statements of Operations Information | For the three months ended June 30, 2026 | For the period March 18, 2026 through |
| --- | ---: | ---: |
| Total investment income | $— | $— |
| Total expenses | $430 | $430 |
| Net investment income | $(430) | $(430) |
| Net decrease in net assets resulting from operations | $(430) | $(430) |

### Consolidated results of operations

As a BDC and a RIC, we are subject to certain constraints on our operations, including limitations imposed by the 1940 Act and the Code. The consolidated results of operations described below may not be indicative of the results we report in future periods.

#### Comparison of the three months ended June 30, 2026 and 2025

The following table shows consolidated results of operations for the three months ended June 30, 2026 and 2025:

*(In thousands)*

|  | For the three months ended June 30, 2026 | 2025 |
| --- | ---: | ---: |
| Total investment income | $25,045 | $24,520 |
| Total expenses | 17,387 | 12,698 |
| Net investment income before excise tax | 7,658 | 11,822 |
| Provision for excise tax | 265 | 373 |
| Net investment income | 7,393 | 11,449 |
| Net realized loss | (6,122) | (10,070) |
| Net unrealized depreciation on investments | (38,533) | (22,156) |
| Net decrease in net assets resulting from operations | $(37,262) | $(20,777) |
| Average debt investments, at fair value | $656,319 | $615,755 |
| Average earning debt investments | $652,283 | $611,097 |
| Average gross assets less cash | $724,246 | $677,289 |
| Average borrowings outstanding | $411,629 | $438,117 |

Net decrease in net assets resulting from operations can vary substantially from period to period for various reasons, including, without limitation, the recognition of realized gains and losses and unrealized appreciation and depreciation on investments. As a result, quarterly comparisons of net decrease in net assets resulting from operations may not be meaningful.

### Investment income

Total investment income increased by $0.5 million, or 2.1%, to $25.0 million for the three months ended June 30, 2026 as compared to the three months ended June 30, 2025. For the three months ended June 30, 2026, total investment income consisted primarily of (1) $23.9 million in interest income from investments, which included $5.5 million in income from the accretion of origination fees and end of term payments and $1.6 million in PIK interest income and (2) $1.1 million in fee income.

Interest income on debt investments increased by $1.3 million, or 5.7%, to $23.9 million, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025. Interest income on debt investments for the three months ended June 30, 2026 as compared to the three months ended June 30, 2025 increased primarily due to an increase of $41.2 million, or 6.7%, in our average earning debt investments. The proportion of total investment income that resulted from the portion of ETPs not received in cash for the three months ended June 30, 2026 and 2025 was 4.4% and 2.8%, 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 June 30, 2026 compared to the three months ended June 30, 2025.

PIK interest income increased by $1.3 million, or 544.4%, to $1.6 million for the three months ended June 30, 2026 compared to the three months ended June 30, 2025. For the three months ended June 30, 2026 and 2025, 6.3% and 1.0%, 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 June 30, 2026 compared to the three months ended June 30, 2025.

Fee income, which includes success fee, other fee and prepayment fee income on debt investments, decreased by $0.8 million, or 40.3%, to $1.1 million for the three months ended June 30, 2026 compared to the three months ended June 30, 2025 primarily due to a lower aggregate amount of principal prepayments for the three months ended June 30, 2026 compared to the three months ended June 30, 2025.

The following table shows our dollar-weighted annualized yield for the three months ended June 30, 2026 and 2025:

| Investment type: | For the three months ended June 30, 2026 | 2025 |
| --- | ---: | ---: |
| Debt investments(1) | 14.9% | 15.8% |
| All investments(1) | 14.0% | 14.7% |

(1) We calculate the dollar-weighted annualized yield on average investment type for any period as (1) total related investment income during the period divided by (2) the average of the fair value of the investment type outstanding on (a) the last day of the calendar month immediately preceding the first day of the period and (b) the last day of each calendar month during the period. The dollar-weighted annualized yield on average investment type is higher than what investors will realize because it does not reflect our expenses or any sales load paid by investors.

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 18% of investment income for the three months ended June 30, 2026 and 2025, respectively. Interest income from the five largest debt investments at fair value in the aggregate accounted for 23% and 22% of investment income for the three months ended June 30, 2026 and 2025, respectively.

### Expenses

Total expenses increased by $4.7 million, or 36.9%, to $17.4 million for the three months ended June 30, 2026 as compared to the three months ended June 30, 2025. Total expenses for each period consisted of interest expense, base management fee, incentive and administrative fees, professional fees and general and administrative expenses. For the three months ended June 30, 2026, transaction costs directly attributable to the Merger were included in total expenses.

Interest expense decreased by $0.4 million, or 4.9%, to $7.8 million for the three months ended June 30, 2026 as compared to the three months ended June 30, 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 June 30, 2026 of $26.5 million, or 6.0%, as compared to the three months ended June 30, 2025.

Base management fee expense increased by $0.2 million, or 6.4%, to $3.1 million for the three months ended June 30, 2026 as compared to the three months ended June 30, 2025. Base management fee increased primarily due to an increase of $47.0 million, or 6.9%, in average gross assets less cash for the three months ended June 30, 2026 as compared to the three months ended June 30, 2025.

There was no performance based incentive fee expense for three months ended June 30, 2026 and 2025. 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 $0.4 million for the three months ended June 30, 2026 compared to an Incentive Fee Cap of $2.3 million for the three months ended June 30, 2025. The Incentive Fee Cap and Deferral Mechanism resulted in $0.4 million and $2.3 million of reduced incentive fee expense and increased net investment income for the three months ended June 30, 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 June 30, 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.

Expenses related to the Merger were $4.4 million for the three months ended June 30, 2026.

Administrative fee expense, professional fees and general and administrative expenses were $2.0 million and $1.5 million for the three months ended June 30, 2026 and 2025, respectively.

### Net realized gains and losses and net unrealized appreciation and depreciation

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.

During the three months ended June 30, 2026, we realized net losses on investments totaling $6.1 million primarily due to the settlement of one of our other investments. During the three months ended June 30, 2025, we realized net losses on investments totaling $9.3 million primarily due to the settlement of two of our debt investments. During the same period, we converted $12.5 million in outstanding principal of the 2031 Convertible Notes which resulted in a realized loss on extinguishment of debt of $0.8 million.

During the three months ended June 30, 2026, net unrealized depreciation on investments totaled $38.5 million which was primarily due to the unrealized depreciation on one of our equity investments and two of our debt investments partially offset by the reversal of previously recorded unrealized depreciation from the settlement of one of our other investments. During the three months ended June 30, 2025, net unrealized depreciation on investments totaled $22.2 million which was primarily due to (1) the unrealized depreciation on seven of our debt investments and (2) the unrealized depreciation on two of our other investments partially offset by (1) the reversal of previously recorded unrealized depreciation from the settlement of two of our debt investments and (2) the unrealized appreciation of two of our warrant investments.

#### Comparison of the six months ended June 30, 2026 and 2025

The following table shows consolidated results of operations for the six months ended June 30, 2026 and 2025:

*(In thousands)*

|  | For the six months ended June 30, 2026 | 2025 |
| --- | ---: | ---: |
| Total investment income | $49,124 | $49,036 |
| Total expenses | 32,228 | 26,117 |
| Net investment income before excise tax | 16,896 | 22,919 |
| Provision for excise tax | 532 | 750 |
| Net investment income | 16,364 | 22,169 |
| Net realized loss | (7,715) | (10,069) |
| Net unrealized depreciation on investments | (43,133) | (54,313) |
| Net decrease in net assets resulting from operations | $(34,484) | $(42,213) |
| Average debt investments, at fair value | $643,951 | $631,384 |
| Average earning debt investments | $642,192 | $630,348 |
| Average gross assets less cash | $720,892 | $704,923 |
| Average borrowings outstanding | $427,835 | $453,714 |

Net decrease in net assets resulting from operations can vary substantially from period to period for various reasons, including, without limitation, the recognition of realized gains and losses and unrealized appreciation and depreciation on investments. As a result, quarterly comparisons of net decrease in net assets resulting from operations may not be meaningful.

### Investment income

Total investment income increased by $0.1 million, or 0.2%, to $49.1 million for the six months ended June 30, 2026 as compared to the six months ended June 30, 2025. For the six months ended June 30, 2026, total investment income consisted primarily of (1) $47.0 million in interest income from investments, which included $10.5 million in income from the accretion of origination fees and end of term payments and $2.8 million in PIK interest income and (2) $2.1 million in fee income.

Interest income on debt investments increased by $0.9 million, or 2.0%, to $47.0 million, for the six months ended June 30, 2026 compared to the six months ended June 30, 2025. Interest income on debt investments for the six months ended June 30, 2026 as compared to the six months ended June 30, 2025 increased primarily due to an increase of $11.8 million, or 1.9%, in our average earning debt investments. The proportion of total investment income that resulted from the portion of ETPs not received in cash for the six months ended June 30, 2026 and 2025 was 5.2% and 3.7%, 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 six months ended June 30, 2026 compared to the six months ended June 30, 2025.

PIK interest income increased by $2.3 million, or 439.7%, to $2.8 million for the six months ended June 30, 2026 compared to the six months ended June 30, 2025. For the six months ended June 30, 2026 and 2025, 5.8% and 1.1%, 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 six months ended June 30, 2026 compared to the six months ended June 30, 2025.

Fee income, which includes success fee, other fee and prepayment fee income on debt investments, decreased by $0.8 million, or 28.1%, to $2.1 million for the six months ended June 30, 2026 compared to the six months ended June 30, 2025 primarily due to a lower aggregate amount of principal prepayments for the six months ended June 30, 2026 compared to the six months ended June 30, 2025.

The following table shows our dollar-weighted annualized yield for the six months ended June 30, 2026 and 2025:

| Investment type: | For the six months ended June 30, 2026 | 2025 |
| --- | ---: | ---: |
| Debt investments(1) | 15.1% | 15.4% |
| All investments(1) | 14.0% | 14.2% |

(1) We calculate the dollar-weighted annualized yield on average investment type for any period as (1) total related investment income during the period divided by (2) the average of the fair value of the investment type outstanding on (a) the last day of the calendar month immediately preceding the first day of the period and (b) the last day of each calendar month during the period. The dollar-weighted annualized yield on average investment type is higher than what investors will realize because it does not reflect our expenses or any sales load paid by investors.

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 22% and 17% of investment income for the six months ended June 30, 2026 and 2025, respectively. Interest income from the five largest debt investments at fair value in the aggregate accounted for 22% and 20% of investment income for the six months ended June 30, 2026 and 2025, respectively.

### Expenses

Total expenses increased by $6.1 million, or 23.4%, to $32.2 million for the six months ended June 30, 2026 as compared to the six months ended June 30, 2025. Total expenses for each period consisted of interest expense, base management fee, incentive and administrative fees, professional fees and general and administrative expenses. For the six months ended June 30, 2026, transaction costs directly attributable to the Merger were included in total expenses.

Interest expense decreased by $0.9 million, or 5.4%, to $16.0 million for the six months ended June 30, 2026 as compared to the six months ended June 30, 2025. Interest expense, which includes the amortization of debt issuance costs, decreased primarily due to a decrease in average borrowings for the six months ended June 30, 2026 of $25.9 million, or 5.7%, as compared to the six months ended June 30, 2025.

Base management fee expense increased by $0.1 million, or 2.1%, to $6.3 million for the six months ended June 30, 2026 as compared to the six months ended June 30, 2025. Base management fee increased primarily due to an increase of $16.0 million, or 2.3%, in average gross assets less cash for the six months ended June 30, 2026 as compared to the six months ended June 30, 2025.

Performance based incentive fee expense increased by $1.8 million to $1.8 million for the six months ended June 30, 2026 as compared to the six months ended June 30, 2025. There was no performance based incentive fee expense for six months ended June 30, 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 $0.8 million for the six months ended June 30, 2026 compared to an Incentive Fee Cap of $4.4 million for the six months ended June 30, 2025. The Incentive Fee Cap and Deferral Mechanism resulted in $0.8 million and $4.4 million of reduced incentive fee expense and increased net investment income for the six months ended June 30, 2026 and 2025, respectively. The incentive fee on pre-incentive fee net investment income was subject to the Incentive Fee Cap for the six months ended June 30, 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.

Expenses related to the Merger were $4.4 million for the six months ended June 30, 2026.

Administrative fee expense, professional fees and general and administrative expenses were $3.8 million and $3.1 million for the six months ended June 30, 2026 and 2025, respectively.

### Net realized gains and losses and net unrealized appreciation and depreciation

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.

During the six months ended June 30, 2026, we realized net losses on investments totaling $6.3 million primarily due to the settlement of one of our other investments. During the six months ended June 30, 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 on extinguishment of debt of $0.1 million. During the six months ended June 30, 2025, we realized net losses on investments totaling $9.3 million primarily due to the settlement of two of our debt investments. During the same period, we converted $12.5 million in outstanding principal of the 2031 Convertible Notes which resulted in a realized loss on extinguishment of debt of $0.8 million.

During the six months ended June 30, 2026, net unrealized appreciation on investments totaled $43.1 million which was primarily due to the unrealized depreciation on one of our equity investments and three of our debt investments partially offset by the reversal of previously recorded unrealized depreciation from the settlement of one of our other investments. During the six months ended June 30, 2025, net unrealized depreciation on investments totaled $54.3 million which was primarily due to (1) the unrealized depreciation on seven of our debt investments, (2) the unrealized depreciation on four of our other investments and (3) the unrealized depreciation on two of our equity investments partially offset by (1) the reversal of previously recorded unrealized depreciation from the settlement of one of our debt investments and (2) the unrealized appreciation of two of our warrant investments. 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 resulting in the unrealized depreciation on such debt investments.

### Liquidity and capital resources

As of June 30, 2026 and December 31, 2025, we had cash and investments in money market funds of $132.3 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 June 30, 2026 and December 31, 2025, we had $2.7 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.

On September 22, 2023, we entered into an At-The-Market (or “ATM”) sales agreement (or the “2023 Equity Distribution Agreement”) with Goldman Sachs & Co. LLC and B. Riley FBR, Inc., (each a “Sales Agent” and, collectively, the “Sales Agents”). The 2023 Equity Distribution Agreement provides that we may offer and sell shares of our common stock from time to time through the Sales Agents up to $150.0 million worth of our common stock, in amounts and at times to be determined by us. Sales of our common stock, if any, may be made in negotiated transactions or transactions that are deemed to be “at-the-market,” as defined in Rule 415 under the Securities Act, including sales made directly on the NASDAQ or similar securities exchange or sales made to or through a market maker other than on an exchange, at prices related to the prevailing market prices or at negotiated prices.

During the three and six months ended June 30, 2026, we did not sell any shares of common stock under the 2023 Equity Distribution Agreement.

During the three months ended June 30, 2025, we did not sell any shares of common stock under the 2023 Equity Distribution Agreement.

During the six months ended June 30, 2025, we sold 404,305 shares of common stock under the 2023 Equity Distribution Agreement. For the same period, we received total accumulated net proceeds of approximately $3.6 million, including $0.2 million of offering expenses, from these sales.

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 and six months ended June 30, 2026, we repurchased 1,365,222 shares of our common stock at an average price of $4.54 on the open market at a total cost of $6.2 million. During the three and six months ended June 30, 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 June 30, 2026, we repurchased 1,532,687 shares of our common stock at an average price of $5.27 on the open market at a total cost of $8.1 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.

At June 30, 2026 and December 31, 2025, there was no outstanding principal balance under the Key Facility. As of June 30, 2026 and December 31, 2025, we had borrowing capacity under the Key Facility of $150.0 million. At June 30, 2026 and December 31, 2025, $82.7 million and $49.6 million, respectively, was available for borrowing under the Key Facility, subject to existing terms and advance rates.

At June 30, 2026 and December 31, 2025, the outstanding principal balance under the NYL Facility was $181.0 million. As of June 30, 2026 and December 31, 2025, we had borrowing capacity under the NYL Facility of $69.0 million. At June 30, 2026 and December 31, 2025, $7.9 million and $1.9 million, respectively, was available for borrowing under the NYL Facility, subject to existing terms and advance rates.

At June 30, 2026 and December 31, 2025, the outstanding principal balance under the Nuveen Facility was $90.0 million. As of June 30, 2026 and December 31, 2025, we had borrowing capacity under the Nuveen Facility of $110.0 million. At June 30, 2026 and December 31, 2025, $26.7 million and $12.1 million, respectively, was available for borrowing under the Nuveen Facility, subject to existing terms and advance rates.

On October 17, 2024, the Company entered into a note purchase agreement (the “2031 Note Purchase Agreement”), by and among the Company, and each purchaser named therein, in connection with the issuance and sale of $20.0 million aggregate principal of the Company’s 7.125% convertible notes due 2031 (the “2031 Convertible Notes”). At June 30, 2026 and December 31, 2025, the aggregate outstanding principal balance of the 2031 Convertible Notes was $2.8 million.

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 June 30, 2026 and December 31, 2025, the aggregate outstanding principal balance of the 2030 Convertible Notes was $16.5 million and $31.5 million, respectively.

Our operating activities provided cash of $81.4 million for the six months ended June 30, 2026, and our financing activities used cash of $89.1 million for the same period. Our operating activities provided cash primarily from cash received 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 2026 Notes and our Key Facility and to pay distributions to our stockholders partially offset by advances on our Key Facility.

Our operating activities provided cash of $36.4 million for the six months ended June 30, 2025, and our financing activities used cash of $56.1 million for the same period. Our operating activities provided cash primarily from principal payments received on our debt investments partially offset by cash used to purchase investments in portfolio companies. Our financing activities used cash primarily to repay our 2022 Asset-Backed Notes and to pay distributions to our stockholders partially offset by an advance on our Nuveen Facility and the sale of shares through our ATM for net proceeds of $3.6 million.

Our primary use of available funds is to make debt investments in portfolio companies and for general corporate purposes. We expect to raise additional equity and debt capital opportunistically as needed and, subject to market conditions, to support our future growth to the extent permitted by the 1940 Act.

In order to remain subject to taxation as a RIC, we intend to distribute to our stockholders all or substantially all of our investment company taxable income. In addition, as a BDC, we are required to maintain asset coverage of at least 150%. This requirement limits the amount that we may borrow.

We believe that our current cash, cash generated from operations, and funds available from our Credit Facilities will be sufficient to meet our working capital and capital expenditure commitments for at least the next 12 months.

### Current borrowings

The following table shows our borrowings as of June 30, 2026 and December 31, 2025:

*(In thousands)*

|  | June 30, 2026 Total Commitment | Balance Outstanding | Unused Commitment | December 31, 2025 Total Commitment | Balance Outstanding | Unused Commitment |
| --- | ---: | ---: | ---: | ---: | ---: | ---: |
| Key Facility | $150,000 | $— | $150,000 | $150,000 | $— | $150,000 |
| NYL Facility | 250,000 | 181,000 | 69,000 | 250,000 | 181,000 | 69,000 |
| Nuveen Facility | 200,000 | 90,000 | 110,000 | 200,000 | 90,000 | 110,000 |
| 2028 Notes | 57,500 | 57,500 | — | 57,500 | 57,500 | — |
| 2027 Notes | 57,500 | 57,500 | — | 57,500 | 57,500 | — |
| 2026 Notes | — | — | — | 57,500 | 57,500 | — |
| 2030 Convertible Notes | 16,450 | 16,450 | — | 31,500 | 31,500 | — |
| 2031 Convertible Notes | 2,750 | 2,750 | — | 2,750 | 2,750 | — |
| Total before debt issuance costs | 734,200 | 405,200 | 329,000 | 806,750 | 477,750 | 329,000 |
| Unamortized debt issuance costs attributable to term borrowings | — | (2,757) | — | — | (4,723) | — |
| Total borrowings outstanding, net | $734,200 | $402,443 | $329,000 | $806,750 | $473,027 | $329,000 |

### Credit Facilities

#### Key Facility

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 June 30, 2026 and December 31, 2025. The interest rate in effect was 6.85% as of June 30, 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.

On June 29, 2023, we amended the Key Facility to, among other things, increase the commitment amount to $150 million and to increase the amount of the accordion feature which now allows the potential increase in the total commitment amount to $300 million. The Key Facility is collateralized by debt investments held by Credit II and permits an advance rate of up to sixty percent (60%) of eligible debt investments held by Credit II. The Key Facility contains covenants that, among other things, require us to maintain a minimum net worth, to restrict the debt investments securing the Key Facility to certain criteria for qualified debt investments and to comply with portfolio company concentration limits as defined in the related loan agreement. After the period during which we may request advances under the Key Facility (or the “Revolving Period”), we may not request new advances, and we must repay the outstanding advances under the Key Facility as of such date, at such times and in such amounts as are necessary to maintain compliance with the terms and conditions of the Key Facility, particularly the condition that the principal balance of the Key Facility not exceed sixty percent (60%) of the aggregate principal balance of our eligible debt investments to our portfolio companies.

#### NYL Facility

HFI is a wholly-owned subsidiary of HSLFI. HFI entered into the NYL Facility with the NYL Noteholders for an aggregate purchase price of up to $100.0 million, with an accordion feature of up to $200.0 million at the mutual discretion and agreement of HSLFI and the NYL Noteholders. On June 1, 2018, HSLFI sold or contributed to HFI certain secured loans made to certain portfolio companies pursuant to the Sale and Servicing Agreement. Any notes issued by HFI are collateralized by all investments held by HFI and permit an advance rate of up to 67% of the aggregate principal amount of eligible debt investments. All advances under the NYL Facility are scheduled to mature in June 2030.

On May 24, 2023, we amended the NYL Facility to, among other things, increase the commitment by $50.0 million to enable our wholly-owned subsidiary to issue up to $250.0 million of secured notes. On April 25, 2025, we amended the NYL Facility to, among other things, extend the investment period to June 5, 2027. In addition, the amendment amended the interest rate for advances made after April 25, 2025, fixing the interest rate at the greater of (i) 4.60% and (ii) the Three Year I Curve plus 2.95% with the interest rate to be reset on any advance date.

Under the terms of the NYL Facility, we are required to maintain a reserve cash balance, which may be used to pay monthly interest and principal payments on the NYL Facility. We have segregated these funds and classified them as restricted investments in money market funds. At June 30, 2026 and December 31, 2025, there were approximately $1.4 million of such restricted investments.

There were $181.0 million in notes issued to the NYL Noteholders as of June 30, 2026 and December 31, 2025 at an interest rate of 6.61% and 6.57%, respectively. As of June 30, 2026 and December 31, 2025, we had borrowing capacity under the NYL Facility of $69.0 million. At June 30, 2026 and December 31, 2025, $7.9 million and $1.9 million, respectively, was available for borrowing, subject to existing terms and advance rates.

#### Nuveen Facility

HFII entered into the Nuveen Facility with the Nuveen Noteholders for an aggregate purchase price of up to $100.0 million, with an accordion feature of up to $200.0 million at the mutual discretion and agreement us and the Nuveen Noteholders. On June 21, 2024, we sold or contributed to HFII certain secured loans made to certain portfolio companies pursuant to the Sale and Servicing Agreement. Any notes issued by HFII are collateralized by all investments held by HFII and permit an advance rate of up to 67.5% of the aggregate principal amount of eligible debt investments. The Nuveen Facility bore interest, payable monthly, determined at a rate per annum equal to the greater of (i) the yield for the United States Treasury constant maturity 3-year and 5-year in the most recent statistical release published by the Board of Governors of the Federal Reserve System designated as “Selected Interest Rates (Daily) – H.15” interpolated to a 4.88-year weighted average life (the “Pricing Benchmark”) plus 3.15% and (ii) 5.00%.

On May 23, 2025, we amended the Nuveen Facility to, among other things, extend the investment period to June 21, 2028 and the maturity date to June 10, 2034 and increase the commitment by $100.0 million which enables our wholly-owned subsidiary to issue up to $200.0 million of secured notes. In addition, the amendment amended the interest rate for advances made after May 23, 2025, fixing the interest rate at the greater of (i) 5.00% and (ii) the Pricing Benchmark plus 2.95%.

On May 20, 2026, we amended the Nuveen Facility to extend the date through which we may request advances under the Nuveen Facility to July 22, 2026.

Under the terms of the Nuveen Facility, we are required to maintain a reserve cash balance, which may be used to pay monthly interest and principal payments on the Nuveen Facility. We have segregated these funds and classified them as restricted investments in money market funds. At June 30, 2026 and December 31, 2025 there were approximately $1.3 million and $1.1 million, respectively, of such restricted investments.

There were $90.0 million in notes issued to the Nuveen Noteholders as of June 30, 2026 and December 31, 2025 at an interest rate of 7.21%. As of June 30, 2026 and December 31, 2025, we had borrowing capacity under the Nuveen Facility of $110.0 million. At June 30, 2026 and December 31, 2025, $26.7 million and $12.1 million, respectively, was available for borrowing, subject to existing terms and advance rates.

### Unsecured Notes

#### 2026 Notes

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.

#### 2027 Notes

On June 15, 2022, we issued and sold an aggregate principal amount of $50.0 million of 6.25% notes due in 2027 and on July 11, 2022, pursuant to the underwriters’ 30 day option to purchase additional notes, we sold an additional $7.5 million of such notes (collectively, the “2027 Notes”). The 2027 Notes have a stated maturity of June 15, 2027 and may be redeemed in whole or in part at our option at any time or from time to time on or after June 15, 2024 at a redemption price of $25 per security plus accrued and unpaid interest. The 2027 Notes bear interest at a rate of 6.25% per year, payable quarterly on March 30, June 30, September 30 and December 30 of each year, commencing on September 30, 2022. The 2027 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 2027 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 June 30, 2026, we were in material compliance with the terms of the 2027 Notes. The 2027 Notes are listed on the New York Stock Exchange under the symbol “HTFC”.

#### 2028 Notes

On December 15, 2025, we issued and sold an aggregate principal amount of $57.5 million of 7.00% notes due in 2028 in a private transaction. The 2028 Notes have a stated maturity of December 15, 2028 and may be redeemed in whole or in part at any time at our option through June 15, 2028, at a redemption price equal to the greater of: (1)(a) the sum of the present values of the remaining scheduled payments of principal and interest thereon discounted to the redemption date on a semi-annual basis at the Treasury Rate plus 50 basis points less (b) interest accrued to the date of redemption, and (2) 100% of the principal amount of the 2028 Notes to be redeemed, plus, in either case, accrued and unpaid interest thereon to, but not including, the redemption date. On or after June 15, 2028, we may redeem the 2028 Notes, in whole or in part, at any time and from time to time, at a redemption price equal to 100% of the principal amount of the 2028 Notes being redeemed plus accrued and unpaid interest there onto the date of redemption. The 2028 Notes bear interest at a rate of 7.00% per year, payable semi-annually on June 15 and December 15 of each year, commencing on June 15, 2026. The 2028 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 2028 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 June 30, 2026, we were in material compliance with the terms of the 2028 Notes.

### Convertible Notes

#### 2030 Convertible Notes

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.

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.

At any time on or after October 4, 2025, at our sole option, we may redeem, from time to time, the 2030 Convertible Notes in whole or in part, out of funds legally available for such redemption, at 100% of the principal amount prepaid plus accrued but unpaid interest to but excluding the date of prepayment.

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.

No holder of 2030 Convertible Notes may exercise its conversion right if upon conversion the holder would receive shares that would cause funds and accounts managed by the investment adviser to such funds and accounts and any person controlled by the parent company of such investment adviser to beneficially own in the aggregate more than 4.99% of the shares outstanding at such time.

The 2030 Convertible Notes are not listed on any exchange and may not be transferred without our consent.

During the three months ended June 30, 2026, the holders of the 2030 Convertible Notes did not convert any of the 2030 Convertible Notes.

During the six months ended June 30, 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.

As of June 30, 2026 and December 31, 2025, the aggregate outstanding principal balance of the 2030 Convertible Notes was $16.5 million and $31.5 million, respectively.

#### 2031 Convertible Notes

On October 17, 2024, we entered into the 2031 Note Purchase Agreement, by and among us and each purchaser named therein, in connection with the issuance and sale of $20.0 million aggregate principal of our 7.125% 2031 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 2031 Convertible Notes of approximately $18.6 million.

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.

At any time on or after April 17, 2025, at our sole option, we may redeem, from time to time, the 2031 Convertible Notes in whole or in part, out of funds legally available for such redemption, at 100% of the principal amount prepaid plus accrued but unpaid interest to but excluding the date of prepayment.

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.

No holder of 2031 Convertible Notes may exercise its conversion right if upon conversion the holder would receive shares that would cause funds and accounts managed by the investment adviser to such funds and accounts and any person controlled by the parent company of such investment adviser to beneficially own in the aggregate more than 4.99% of the shares outstanding at such time.

The 2031 Convertible Notes are not listed on any exchange and may not be transferred without our consent.

During the three and six months ended June 30, 2026, the holders of the 2031 Convertible Notes did not convert any of the 2031 Convertible Notes.

During the three and six months ended June 30, 2025, the holders of a portion of the 2031 Convertible Notes converted $12.5 million in outstanding principal of the 2031 Convertible Notes plus accrued but unpaid interest on such outstanding principal as of the conversion date into 1,621,503 shares of common stock at a weighted average conversion price of $7.79, together with cash in lieu of fractional shares, in accordance with noteholder conversion notice.

As of June 30, 2026 and December 31, 2025, the aggregate outstanding principal balance of the 2031 Convertible Notes was $2.8 million.

### Other assets

As of June 30, 2026 and December 31, 2025, other assets were $7.8 million and $9.1 million, respectively, which were primarily comprised of debt issuance costs and prepaid expenses.

### Contractual obligations and off-balance sheet arrangements

The following table shows our significant contractual payment obligations and off-balance sheet arrangements as of June 30, 2026:

*(In thousands)*

|  | Payments due by period Total | Less than 1 year | 1 – 3 Years | 3 – 5 Years | After 5 years |
| --- | ---: | ---: | ---: | ---: | ---: |
| Borrowings | $405,200 | $75,067 | $203,395 | $123,988 | $2,750 |
| Unfunded commitments | 153,516 | 75,420 | 76,515 | 1,581 | — |
| Incentive fee deferral | 25,431 | 11,340 | 14,091 | — | — |
| Total | $584,147 | $161,827 | $294,001 | $125,569 | $2,750 |

In the normal course of business, we are party to financial instruments with off-balance sheet risk. These consist primarily of unfunded commitments to extend credit, in the form of loans, to our portfolio companies. Unfunded commitments to provide funds to portfolio companies are not reflected on our balance sheet. Our unfunded commitments may be significant from time to time. As of June 30, 2026, we had unfunded commitments of $153.5 million. This includes $16.6 million of undrawn revolver commitments. These commitments are subject to the same underwriting and ongoing portfolio maintenance requirements as are the financial instruments that we hold on our balance sheet. In addition, these commitments are often subject to financial or non-financial milestones and other conditions to borrowing that must be achieved before the commitment can be drawn. Since these commitments may expire without being drawn upon, the total commitment amount does not necessarily represent future cash requirements. We regularly monitor our unfunded commitments and anticipated refinancings, maturities and capital raising, to ensure that we have sufficient liquidity to fund unfunded commitments. As of June 30, 2026, we reasonably believed that our assets would provide adequate financial resources to satisfy all of our unfunded commitments.

In addition to the Credit Facilities, we have certain commitments pursuant to our Investment Management Agreement entered into with our Advisor. We have agreed to pay a fee for investment advisory and management services consisting of two components (1) a base management fee equal to a percentage of the value of our gross assets less cash or cash equivalents, and (2) a two-part incentive fee. We have also entered into a contract with our Advisor to serve as our administrator. Payments under the Administration Agreement are equal to an amount based upon our allocable portion of our Advisor’s overhead in performing its obligations under the agreement, including rent, fees and other expenses inclusive of our allocable portion of the compensation of our Chief Financial Officer and Chief Compliance Officer and their respective staffs. See Note 3 to our consolidated financial statements for additional information regarding our Investment Management Agreement and our Administration Agreement.

The incentive fee on Pre-Incentive Fee Net Investment Income is subject to a fee cap and deferral mechanism which is determined based upon a look-back period of up to three years and is expensed when incurred. For this purpose, the Incentive Fee Look-back Period includes the relevant calendar quarter and the 11 preceding full calendar quarters. Each quarterly incentive fee payable on Pre-Incentive Fee Net Investment Income is subject to the Incentive Fee Cap and Deferral Mechanism. The Incentive Fee Cap is equal to (a) 20.00% of Cumulative Pre-Incentive Fee Net Return during the Incentive Fee Look-back Period less (b) cumulative incentive fees of any kind paid to our Advisor during the Incentive Fee Look-back Period. To the extent the Incentive Fee Cap is zero or a negative value in any calendar quarter, we will not pay an incentive fee on Pre-Incentive Fee Net Investment Income to our Advisor in that quarter. To the extent that the payment of incentive fees on Pre-Incentive Fee Net Investment Income is limited by the Incentive Fee Cap, the payment of such fees will be deferred and paid in subsequent calendar quarters up to three years after their date of deferment, subject to certain limitations, which are set forth in the Investment Management Agreement. During the three months ended June 30, 2026 and 2025, the Incentive Fee Cap and Deferral Mechanism resulted in deferral of $0.4 million and $2.3 million, respectively, of incentive fee which may become subject to payment up to three years after the date of deferment. During six months ended June 30, 2026 and 2025, the Incentive Fee Cap and Deferral Mechanism resulted in deferral of $0.8 million and $4.4 million, respectively, of incentive fee which may become subject to payment up to three years after the date of deferment. As of June 30, 2026 and December 31, 2025, the total amount subject to recoupment was $25.4 million and $28.0 million, respectively. Commencing with the quarter ending March 31, 2025 and terminated with the quarter ending December 31, 2025, our Advisor agreed to waive the portion of its quarterly income incentive fee, if any, if and to the extent that, after payment of such portion, our net investment income per share for such quarter would be less than the quarterly distribution per share declared in such quarter. During the six months ended June 30, 2025, our Advisor did not earn an income incentive fee.

### Distributions

In order to qualify and be subject to tax as a RIC, we must meet certain source-of-income, asset diversification and annual distribution requirements. Generally, in order to qualify as a RIC, we must derive at least 90% of our gross income for each tax year from dividends, interest, payments with respect to certain securities, loans, gains from the sale or other disposition of stock, securities or foreign currencies, income derived from certain publicly traded partnerships, or other income (including but not limited to gains from options, futures or forward contracts) derived with respect to our business of investing in stock, securities or other currencies. We must also meet certain asset diversification requirements at the end of each quarter of each tax year. Failure to meet these diversification requirements on the last day of a quarter may result in us having to dispose of certain investments quickly in order to prevent the loss of RIC status. Any such dispositions could be made at disadvantageous prices or times, and may cause us to incur substantial losses.

In addition, in order to be subject to tax as a RIC and to avoid the imposition of corporate-level tax on the income and gains we distribute to our stockholders in respect of any tax year, we are required under the Code to distribute as dividends to our stockholders out of assets legally available for distribution each tax year an amount generally at least equal to 90% of the sum of our net ordinary income and net short-term capital gains in excess of net long-term capital losses, if any. Additionally, in order to avoid the imposition of a U.S. federal excise tax, we are required to distribute, in respect of each calendar year, dividends to our stockholders of an amount at least equal to the sum of 98% of our calendar year net ordinary income (taking into account certain deferrals and elections); 98.2% of our capital gain net income (adjusted for certain ordinary losses) for the one year period ending on October 31 of such calendar year; and any net ordinary income and capital gain net income for preceding calendar years that were not distributed during such calendar years and on which we previously did not incur any U.S. federal corporate-level income tax. If we fail to qualify as a RIC for any reason and become subject to corporate-level income tax, the resulting corporate-level income taxes could substantially reduce our net assets, the amount of income available for distribution and the amount of our distributions. Such a failure would have a material adverse effect on us and our stockholders. In addition, we could be required to recognize unrealized gains, incur substantial taxes and interest and make substantial distributions in order to re-qualify as a RIC. We cannot assure stockholders that they will receive any distributions.

To the extent our taxable earnings in a tax year fall below the total amount of our distributions made to stockholders in respect of such tax year, a portion of those distributions may be deemed a return of capital to our stockholders for U.S. federal income tax purposes. Thus, the source of a distribution to our stockholders may be the original capital invested by the stockholder rather than our income or gains. Stockholders should review any written disclosure accompanying a distribution payment carefully and should not assume that the source of any distribution is our ordinary income or gains.

We have adopted an “opt out” dividend reinvestment plan, or DRIP, for our common stockholders. As a result, if we declare a distribution, then stockholders’ cash distributions will be automatically reinvested in additional shares of our common stock, net of applicable withholding taxes, unless a stockholder specifically “opts out” of our DRIP. If a stockholder opts out, that stockholder will receive cash distributions. Although distributions paid in the form of additional shares of our common stock will generally be subject to U.S. federal, state and local taxes, stockholders participating in our DRIP will not receive any corresponding cash distributions with which to pay any such applicable taxes. If our common stock is trading above NAV, a stockholder receiving distributions in the form of additional shares of our common stock will be treated as receiving a distribution of an amount equal to the fair market value of such shares of our common stock. We may use newly issued shares to implement the DRIP, or we may purchase shares in the open market in connection with our obligations under the DRIP.

### Related party transactions

We have entered into the Investment Management Agreement with our Advisor. Our Advisor is registered as an investment adviser under the Investment Advisers Act of 1940, as amended. Our investment activities are managed by our Advisor and supervised by our Board, the majority of whom are independent directors. Under the Investment Management Agreement, we have agreed to pay our Advisor a base management fee as well as an incentive fee. During the three months ended June 30, 2026 and 2025, our Advisor earned $3.1 million and $3.0 million pursuant to the Investment Management Agreement. During the six months ended June 30, 2026 and 2025, our Advisor earned $8.0 million and $6.1 million pursuant to the Investment Management Agreement.

On March 31, 2025, Monroe closed a transaction pursuant to which Momentum US Bidco LLC, an affiliate of Wendel SE, acquired 75% of the outstanding equity interests of Monroe Capital Intermediate Holdings, LLC, the indirect parent company of our Advisor, and certain other affiliates of Monroe (or the “Transaction”). The closing of the Transaction resulted in a change in control of our Advisor (the “Advisor Change in Control”). The Advisor Change in Control did not substantially or adversely affect us.

On April 14, 2026, we completed our previously announced merger with MRCC, the Merger Sub, Monroe Capital BDC Advisors, LLC, and our Advisor, pursuant to the Merger Agreement. In connection with the Merger, our Advisor has agreed to waive $4.0 million of base management fees and/or incentive fees due and payable to our Advisor pursuant to the terms of the Investment Management Agreement at the rate of $1.0 million per quarter commencing with our third fiscal quarter of 2026. The Fee Waiver will be in effect until the end of our second fiscal quarter of 2027 and, for each applicable fiscal quarter, will not exceed the total amount of base management fees and incentive fees earned by our Advisor during such fiscal quarter. See “Item 2 — Management’s Discussion and Analysis of Financial Condition and Results of Operations — Overview” for additional information about the Mergers.

We have also entered into the Administration Agreement with our Advisor. Under the Administration Agreement, we have agreed to reimburse our Advisor for our allocable portion of overhead and other expenses incurred by our Advisor in performing its obligations under the Administration Agreement, including rent and our allocable portion of the costs of compensation and related expenses of our Chief Financial Officer and Chief Compliance Officer and their respective staffs. In addition, pursuant to the terms of the Administration Agreement our Advisor provides us with the office facilities and administrative services necessary to conduct our day-to-day operations. During the three months ended June 30, 2026 and 2025, our Advisor earned $0.4 million, pursuant to the Administration Agreement. During the six months ended June 30, 2026 and 2025, our Advisor earned $1.1 million and $0.8 million, respectively, pursuant to the Administration Agreement.

Our Advisor has granted us a non-exclusive, royalty-free license to use the service mark “Horizon Technology Finance.”

We believe that we derive substantial benefits from our relationship with our Advisor. Our Advisor and its affiliates may manage other investment vehicles with similar or overlapping investment strategies as us. Our Advisor may provide us with an opportunity to co-invest with other investment vehicles managed by our Advisor, Monroe and/or their affiliates. Under the 1940 Act, absent receipt of exemptive relief from the SEC, we and our affiliates are precluded from co-investing in negotiated investments with other funds and accounts sponsored or managed by our Advisor, Monroe and their affiliates. On December 17, 2025, the SEC granted Monroe and its affiliates, our Advisor, and us exemptive relief for co-investments for us, our Advisor, Monroe and its affiliates. We are required to comply with all terms and conditions required therein. The exemptive relief affords our Advisor greater flexibility to negotiate the terms of co-investments if our Board determines that it would be advantageous for us to co-invest with other accounts sponsored or managed by our Advisor, Monroe or their affiliates in a manner consistent with our investment objectives, positions, policies, strategies and restrictions as well as regulatory requirements and other pertinent factors.

### Critical accounting policies

The discussion of our financial condition and results of operation is based upon our financial statements, which have been prepared in accordance with U.S. generally accepted accounting principles, or GAAP. The preparation of these consolidated financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses. Changes in the economic environment, financial markets and any other parameters used in determining such estimates could cause actual results to differ. In addition to the discussion below, we describe our significant accounting policies in the notes to our consolidated financial statements.

We have identified the following items as critical accounting policies.

### Valuation of investments

Investments are recorded at fair value. Pursuant to the amended SEC Rule 2a-5 of the 1940 Act, on July 29, 2022, our Board designated our Advisor as the “valuation designee.” Our Board is responsible for oversight of the valuation designee. The valuation designee has established a Valuation Committee to determine in good faith the fair value of our investments, based on input of our Advisor’s management and personnel and independent valuation firms which are engaged at the direction of the Valuation Committee to assist in the valuation of certain portfolio investments lacking a readily available market quotation at least once during a trailing twelve-month period. The Valuation Committee determines fair values pursuant to a valuation policy approved by our Board and pursuant to a consistently applied valuation process. This valuation process is conducted at the end of each fiscal quarter, with at least 25% (based on fair value) of our valuation of portfolio companies lacking readily available market quotations subject to review by an independent valuation firm. We apply fair value to substantially all of our investments in accordance with Topic 820, *Fair Value Measurement*, of the Financial Accounting Standards Board’s, or FASB’s, Accounting Standards Codification as amended, or ASC, which establishes a framework used to measure fair value and requires disclosures for fair value measurements. We have categorized our investments carried at fair value, based on the priority of the valuation technique, into a three-level fair value hierarchy. Fair value is a market-based measure considered from the perspective of the market participant who holds the financial instrument rather than an entity specific measure. Therefore, when market assumptions are not readily available, our own assumptions are set to reflect those that we believe market participants would use in pricing the financial instrument at the measurement date.

The availability of observable inputs can vary depending on the financial instrument and is affected by a wide variety of factors, including, for example, the type of product, whether the product is new, whether the product is traded on an active exchange or in the secondary market and the current market conditions. To the extent that the valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. The three categories within the hierarchy are as follows:

**Level 1** Quoted prices in active markets for identical assets and liabilities.

**Level 2** Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities in active markets, quoted prices in markets that are not active and model-based valuation techniques for which all significant inputs are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

**Level 3** Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Level 3 assets and liabilities include financial instruments whose value is determined using pricing models, discounted cash flow methodologies or similar techniques, as well as instruments for which the determination of fair value requires significant management judgment or estimation.

### Income recognition

Interest on debt investments is accrued and included in income based on contractual rates applied to principal amounts outstanding. Interest income is determined using a method that results in a level rate of return on principal amounts outstanding. Generally, when a debt investment becomes 90 days or more past due, or if we otherwise do not expect to receive interest and principal repayments, the debt investment is placed on non-accrual status and the recognition of interest income may be discontinued. Interest payments received on non-accrual debt investments may be recognized as income, on a cash basis, or applied to principal depending upon management’s judgment at the time the debt investment is placed on non-accrual status. For the three months ended June 30, 2026 and 2025, we recognized in interest income $0.03 million and $0.2 million, respectively, from debt investments while on non-accrual status. For the six months ended June 30, 2026 and 2025, we recognized in interest income $0.1 million and $0.2 million, respectively, from debt investments while on non-accrual status.

We receive a variety of fees from borrowers in the ordinary course of conducting our business, including advisory fees, commitment fees, amendment fees, non-utilization fees, success fees and prepayment fees. In a limited number of cases, we may also receive a non-refundable deposit earned upon the termination of a transaction. Debt investment origination fees, net of certain direct origination costs, are deferred, and along with unearned income, are amortized as a level yield adjustment over the respective term of the debt investment. All other income is recorded into income when earned. Fees for counterparty debt investment commitments with multiple debt investments are allocated to each debt investment based upon each debt investment’s relative fair value. When a debt investment is placed on non-accrual status, the amortization of the related fees and unearned income is discontinued until the debt investment is returned to accrual status.

Certain debt investment agreements also require the borrower to make an ETP that is accrued into income over the life of the debt investment to the extent such amounts are expected to be collected. We will generally cease accruing the income if there is insufficient value to support the accrual or if we do not expect the borrower to be able to pay the ETP due.

In connection with substantially all lending arrangements, we receive warrants to purchase shares of stock from the borrower. We record the warrants as assets at estimated fair value on the grant date using the Black-Scholes valuation model. We consider the warrants as loan fees and record them as unearned income on the grant date. The unearned income is recognized as interest income over the contractual life of the related debt investment in accordance with our income recognition policy. Subsequent to origination, the warrants are also measured at fair value using the Black-Scholes valuation model. Any adjustment to fair value is recorded through earnings as net unrealized gain or loss on investments. Gains and losses from the disposition of the warrants or stock acquired from the exercise of warrants are recognized as realized gains and losses on investments.

Distributions from the RoHo Joint Venture are evaluated at the time of distribution to determine if the distribution should be recorded as dividend income or a return of capital. Generally, we will not record distributions from the RoHo Joint Venture as dividend income unless there are sufficient accumulated tax-basis earnings and profit in the RoHo Joint Venture prior to distribution. Distributions that are classified as a return of capital are recorded as a reduction in the cost basis of the investment. For the three months ended June 30, 2026 and the period March 18, 2026 (the commencement of the RoHo Joint Venture’s operations) through June 30, 2026, the RoHo Joint Venture did not distribute dividend income to us.

Realized gains or losses on the sale of investments, or upon the determination that an investment balance, or portion thereof, is not recoverable, are calculated using the specific identification method. We measure realized gains or losses by calculating the difference between the net proceeds from the repayment or sale and the amortized cost basis of the investment. Net unrealized appreciation or depreciation reflects the change in the fair values of our portfolio investments during the reporting period, including any reversal of previously recorded unrealized appreciation or depreciation, when gains or losses are realized.

### Income taxes

We have elected to be treated as a RIC under Subchapter M of the Code and operate in a manner so as to qualify for the tax treatment applicable to RICs. In order to qualify as a RIC and to avoid the imposition of corporate-level U.S. federal income tax on the amounts we distribute to our stockholders, among other things, we are required to meet certain source of income and asset diversification requirements, and we must timely distribute dividends to our stockholders out of assets legally available for distribution each tax year of an amount generally equal to at least 90% of our investment company taxable income, as defined by the Code and determined without regard to any deduction for dividends paid. We, among other things, have made and intend to continue to make the requisite distributions to our stockholders, which will generally relieve us from incurring any material liability for U.S. federal income taxes.

Depending on the level of taxable income earned in a tax year, we may choose to carry forward taxable income in excess of current year distributions into the next tax year and incur a 4% excise tax on such income, as required. To the extent that we determine that our estimated current year annual taxable income will be in excess of estimated current year distributions, we will accrue excise tax, if any, on estimated excess taxable income as taxable income is earned.

We evaluate tax positions taken in the course of preparing our tax returns to determine whether the tax positions are “more-likely-than-not” to be sustained by the applicable tax authority in accordance with ASC Topic 740, *Income Taxes*, as modified by ASC Topic 946, *Financial Services — Investment Companies*. Tax benefits of positions not deemed to meet the more-likely-than-not threshold, or uncertain tax positions, are recorded as a tax expense in the current year. It is our policy to recognize accrued interest and penalties related to uncertain tax benefits in income tax expense. We had no material uncertain tax positions at June 30, 2026 and December 31, 2025.

### Recently issued accounting pronouncements

In November 2024, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40). ASU No. 2024-03 requires disaggregated disclosure of certain costs and expenses, including purchase of inventory, employee compensation, depreciation, amortization and depletion, within relevant income statement captions. ASU 2024-03 is effective for years beginning after December 15, 2026, and interim periods beginning after December 15, 2027. Early adoption and retrospective application are permitted. We are currently evaluating the impact ASU No. 2024-03.

In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements, which clarifies interim reporting disclosure requirements and enhances the organization of interim reporting guidance. ASU 2025-11 is effective for interim reporting periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. We are currently evaluating the impact ASU No. 2025-11.

### Recent developments

On July 1, 2026, we funded a $0.6 million debt investment to an existing portfolio company, Glass Routes LLC.

On July 8, 2026, we funded a $5.0 million debt investment to an existing portfolio company, Onkos Surgical, Inc.

On July 15, 2026, we funded a $2.5 million debt investment to an existing portfolio company, Ossio, Inc.

On July 15, 2026, we funded a $23.3 million debt investment to a new portfolio company, StarCompliance Midco, LLC.

On July 17, 2026, we amended the Nuveen Facility to extend the date through which we may request advances under the Nuveen Facility to August 21, 2026 and to decrease the commitment by $50.0 million in connection with secured notes previously issued by our wholly-owned subsidiary.

On July 24, 2026, we funded a $6.8 million debt investment to an existing portfolio company, Avive Solutions, Inc.

On July 29, 2026, we amended the NYL Facility to, among other things, to (i) add a second class of notes and (ii) extend the legal final maturity date to June 2034. The total commitment amount of $250.0 million for the secured notes remains the same under the NYL Facility.

On July 31, 2026, we funded a $0.1 million debt investment to an existing portfolio company Volt Bidco, Inc.

On August 3, 2026, Mirantis, Inc. prepaid its outstanding principal balance of $15.0 million on its venture loan, plus interest, end-of-term payment and prepayment penalty.

On August 3, 2026, we sold our debt investment in Havenly, Inc. (“Havenly”) and received proceeds in an amount equal to the outstanding principal balance of $11.8 million of the debt investment, plus accrued interest and $1.2 million of the end-of-term payment. We continue to hold warrants in Havenly.

On August 3, 2026, our Board approved an increase in the amount of common stock that may be repurchased under the stock repurchase program to allow us to repurchase up to a total of $20.0 million of common stock.

On August 3, 2026, we funded a $0.7 million debt investment to an existing portfolio company, Glass Routes LLC.

## Market risk

As filed, 5,459 characters.

We are subject to financial market risks, including changes in interest rates. During the periods covered by our financial statements, the interest rates on the debt investments within our portfolio were primarily at floating rates. We expect that our debt investments in the future will primarily have floating interest rates. As of June 30, 2026 and December 31, 2025, 99% and 100%, respectively, of the outstanding principal amount of our debt investments bore interest at floating rates. Contractual interest rates on our commitments to lend to our portfolio companies are typically based on the Prime Rate as published in the Wall Street Journal.

Based on our June 30, 2026 consolidated statement of assets and liabilities (without adjustment for potential changes in the credit market, credit quality, size and composition of assets on the consolidated statement of assets and liabilities or other business developments that could affect net income) and the base index rates at June 30, 2026, the following table shows the annual impact on the change in net assets resulting from operations of changes in interest rates, which assumes no changes in our investments and borrowings:

*(In thousands)*

| Change in basis points | Investment Income | Interest Expense | Change in Net Assets(1) |
| --- | ---: | ---: | ---: |
| Up 300 basis points | $17,129 | $— | $17,129 |
| Up 200 basis points | $10,646 | $— | $10,646 |
| Up 100 basis points | $4,496 | $— | $4,496 |
| Down 300 basis points | $(4,120) | $— | $(4,120) |
| Down 200 basis points | $(3,019) | $— | $(3,019) |
| Down 100 basis points | $(1,733) | $— | $(1,733) |

(1) Excludes the impact of incentive fees based on Pre-Incentive Fee Net Investment Income.

While our 2027 Notes, our 2028 Notes, our 2030 Convertible Notes and our 2031 Convertible Notes bear interest at a fixed rate, our Credit Facilities have floating interest rate provisions. The Key Facility is subject to an interest rate floor of 4.10% per annum, based on a prime rate index which resets monthly. The interest payable on the NYL Facility is based on the Three Year I Curve rate plus a margin of 2.95% with an interest rate floor and resets on any advance date. The interest payable on the Nuveen Facility is based on the United States Treasury constant maturity 3-year and 5-year rates plus a margin of 2.95% with an interest rate floor and resets on any advance date. Any other credit facilities into which we enter in the future may have floating interest rate provisions. We have used hedging instruments in the past to protect us against interest rate fluctuations, and we may use them in the future. Such instruments may include caps, swaps, futures, options and forward contracts. While hedging activities may insulate us against adverse changes in interest rates, they may also limit our ability to participate in the benefits of lower interest rates with respect to the investments in our portfolio with fixed interest rates. Engaging in commodity interest transactions such as swap transactions or futures contracts on our behalf may cause our Advisor to fall within the definition of “commodity pool operator” under the Commodity Exchange Act (the “CEA”), and related Commodity Futures Trading Commission (the “CFTC”), regulations. On January 31, 2020, our Advisor claimed an exclusion from the definition of the term “commodity pool operator” under the CEA and the CFTC regulations in connection with its management of us and, therefore, is not subject to CFTC registration or regulation under the CEA as a commodity pool operator with respect to its management of us.

Because we currently fund, and expect to continue to fund, our investments with borrowings, our net income is dependent upon the difference between the rate at which we borrow funds and the rate at which we invest the funds borrowed. Accordingly, there can be no assurance that a significant change in market interest rates will not have a material adverse effect on our net income. In periods of elevated interest rates, our cost of funds could increase, which would reduce our net investment income.

### Inflation, Market Volatility and Supply Chain Risk

Economic activity has continued to accelerate across sectors and regions. Nevertheless, due to global supply chain issues, geopolitical events, a rise in energy prices and strong consumer demand as economies continue to reopen, inflation accelerated in the United States and globally before falling to lower levels at the end of 2023. Inflation may revive in the near to medium-term, particularly in the United States, with the advent of significant trade tariffs at the federal level, and monetary policy may tighten in response. Concerns over future increases in inflation, economic recession, as well as interest rate volatility and fluctuations in oil and gas prices resulting from global production and demand levels, as well as geopolitical tension, have exacerbated market volatility. Market uncertainty and volatility have also been magnified by actual and potential shifts in U.S. and foreign, trade, economic and other policies, including with respect to treaties and tariffs and uncertainty related to the upcoming 2026 U.S. midterm elections. Persistent inflationary pressures, foreign currency exchange volatility, volatility in global capital markets and concerns over actual and potential tariffs and sanctions could affect our portfolio companies’ profit margins.

## Controls and procedures

As filed, 1,695 characters.

### (a) Evaluation of disclosure controls and procedures

As of June 30, 2026, we, including our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a‑15(e) under the Exchange Act). Based on that evaluation, our management, including our Chief Executive Officer and Chief Financial Officer, concluded that our disclosure controls and procedures were effective and provided reasonable assurance that information required to be disclosed in our periodic SEC filings is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. However, in evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated can provide only reasonable assurance of achieving the desired control objectives, and management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of such possible controls and procedures.

### (b) Changes in internal controls over financial reporting.

There have been no material changes in our internal control over financial reporting (as defined in Rules 13a‑15(f) and 15d‑15(f) under the Exchange Act) during our most recently completed fiscal quarter, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

## Risk factors

As filed, 1,397 characters.

In addition to other information set forth in this quarterly report on Form 10-Q, you should carefully consider the factors set forth in “Item 1A Risk Factors” in our annual report on Form 10‑K for the year ended December 31, 2025, which could materially affect our business, financial condition and/or operating results. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially affect our business, financial condition and/or operating results. Except as set forth below, there have been no material changes during the six months ended June 30, 2026 to the risk factors set forth in “Item 1A. Risk Factors” of our annual report on Form 10-K for the year ended December 31, 2025.

***The conflicts in the Middle East may impact regional and global economic markets.***

The ongoing conflicts in the Middle East, including the involvement of the United States and other countries, including Israel and Iran, as well as political and civil unrest related to the foregoing, could have severe adverse effects on regional and global economic markets. It is difficult to predict the conflicts’ impact on global and market conditions and, as a result, there is material uncertainty and risk with respect to us and our portfolio companies, and our ability and the ability of the portfolio companies to achieve their investment objectives.

Filed Aug 4, 2026.
Source: SEC EDGAR, the filing index for accession 0001437749-26-025689. Last ingested by Listed: Nov 5, 2026, 18:48 ET. No prices; not investment advice.