About Horizon Technology Finance

Horizon Technology Finance Corporation operates as a specialty finance company. The company lends to and invests in development-stage companies in the technology, life science, healthcare information and services and cleantech industries, which it refers to collectively as its ‘Target Industries’. The company focuses on making secured debt investments, which it refers to as ‘Venture Loans’, to venture capital backed companies in its Target Industries, which it refers to as ‘Venture Lending’. The company also selectively provides Venture Loans to publicly traded companies in its Target Industries. Its debt investments are secured by first liens or first liens behind a secured revolving line of credit (Senior Term Loans). The company is an externally managed, closed-end, non-diversified management investment company that has elected to be regulated as a business development company under the Investment Company Act of 1940, as amended, or the 1940 Act. The company is permitted to, and expects to, finance a portion of its investments through borrowings. As of December 31, 2017, the company funded 158 portfolio companies and its debt investment portfolio consisted of 33 debt investments. In addition to the company’s debt investments, as of December 31, 2017, it held warrants to purchase stock, primarily preferred stock, in 72 portfolio companies, equity positions in six portfolio companies and success fee arrangements in 10 portfolio companies. The company’s investment activities are managed by its Horizon Technology Finance Management LLC (the ‘Advisor’), and its Advisor’s ability to identify investment opportunities, conduct diligence on and value prospective investments, negotiate investments and manage its portfolio of investments. The company focuses its investments primarily in four key industries of the technology market. The technology sectors that the company focuses on include communications, networking, data storage, software, cloud computing, semiconductor, Internet and media and consumer-related technologies. The life science sectors that the company focuses on include biotechnology, drug discovery, drug delivery, bioinformatics and medical devices. The healthcare information and services sectors that the company focuses on include diagnostics, electronic medical record services and software and other healthcare related services and technologies. The cleantech sectors that the company focuses on include alternative energy, power management, energy efficiency, green building materials and waste recycling. The company refers to all of these companies as ‘technology-related’ companies because the companies are developing or offering goods and services to businesses and consumers, which utilize scientific knowledge, including techniques, skills, methods, devices and processes, to solve problems. Strategy The key elements of the company's strategy are to structured investments in the venture capital and private and public equity markets; ‘enterprise value’ lending; creative products with attractive risk-adjusted pricing; opportunity for enhanced returns; direct origination; disciplined and balanced underwriting and portfolio management; and use of leverage to increase returns on equity. License Agreement The company has a license agreement with Horizon Technology Finance, LLC pursuant to which it was granted a non-exclusive, royalty-free right and license to use the service mark ‘Horizon Technology Finance, LLC’. Under this agreement, the company has a right to use the ‘Horizon Technology Finance, LLC’ service mark. Regulation The company has elected to be regulated as a business development company under the 1940 Act and elected to be treated as a regulated investment company under Subchapter M of the Internal Revenue Code of 1986. The Sarbanes-Oxley Act of 2002 imposes various regulatory requirements on publicly held companies and their insiders. Majority of these requirements affect the company. The company also must annually distribute dividends of an amount at least equal to the sum of its 90% of ordinary income and realized net short-term capital gains (net short-term capital gains in excess of net long term losses), if any, out of the assets legally available for distribution. The company and its Advisor have each adopted a code of ethics pursuant to Rule 17j-1 under the 1940 Act and Rule 204A-1 under the Investment Advisers Act of 1940, as amended, or (the Advisers Act), respectively, which establishes procedures for personal investments and restricts certain personal securities transactions. The company’s Advisor is registered with the U.S. Securities and Exchange Commission as an investment adviser under the Advisers Act. The Sarbanes-Oxley Act of 2002 requires the company to review its policies and procedures to determine whether it complies with the Sarbanes-Oxley Act of 2002 and the regulations promulgated thereunder. History Horizon Technology Finance Corporation was founded in 2008.