Horizon Technology Finance Corp and Monroe Capital Corporation: Shareholders Approve Transformative Merger

Key Points Investors Should Know

• Shareholder Approval: On March 16, 2026, Horizon Technology Finance Corporation (“HRZN” or “the Company”) announced that shareholders of both HRZN and Monroe Capital Corporation (“MRCC”) have approved the proposals for their merger. This follows a special meeting of shareholders held on March 13, 2026.
• Merger Details: The merger is expected to accelerate HRZN’s growth, expand its scale, and strengthen its position in the venture lending market. CEO Mike Balkin emphasized that the combined company will boost earnings potential and expand its capacity to serve innovative, high-growth companies.
• Immediate Distributions:
  • Final MRCC Distribution: MRCC will declare a one-time cash distribution of \$13.0 million (“Supplemental MRCC Distribution”), in addition to its planned pre-Merger closing distribution of undistributed taxable earnings (“Final MRCC Tax Distribution”).
  • HRZN Supplemental Distributions: HRZN intends to use its undistributed taxable earnings of \$27.6 million (as of December 31, 2025) to supplement regular monthly distributions to the combined company’s shareholders for two quarters following the merger. These distributions are subject to the closing of the merger and the HRZN Board’s declaration.
• Exchange Ratio: MRCC shareholders will receive newly issued shares of HRZN common stock in exchange for each share of MRCC common stock held. The exchange ratio will be determined by the MRCC net asset value per share divided by HRZN’s net asset value per share, shortly before the closing.
• Regulatory Compliance: The HRZN Board will consider asset coverage ratio requirements under the Investment Company Act of 1940, as well as financial and operating covenants, before declaring any supplemental distributions.
• Forward-Looking Statements: The report contains forward-looking statements regarding the timing and benefits of the merger, future distributions, and the combined company’s competitive position and growth potential. These statements are subject to risks and uncertainties.
• Security Information:
  • Common Stock, par value \$0.001 per share, trades under the symbol HRZN on the NASDAQ Stock Exchange.
  • 6.25% Notes due 2027, trades under the symbol HTFC on the NYSE Stock Exchange.
• Emerging Growth Company: HRZN is not classified as an emerging growth company.

Potential Price Sensitive Developments

• Merger Approval: The shareholder approval and imminent completion of the merger is a significant event that could materially impact the share price of HRZN and MRCC. Investors should note the expected increase in scale, enhanced earnings potential, and the expanded capacity to support high-growth companies, which may attract new investors or institutional interest.
• Special Distributions: The declaration of immediate cash distributions by MRCC and the planned supplemental distributions by HRZN represent near-term returns to shareholders, which could positively affect share valuation and investor sentiment.
• Exchange Ratio Details: The exchange ratio, based on net asset values, may impact the value received by MRCC shareholders and the future dilution or accretion for HRZN shareholders.
• Forward-Looking Risks: As with any merger, risks exist, including regulatory compliance, integration challenges, and the possibility that expected synergies may not materialize as projected.

Additional Information & Contacts

• For investor relations, HRZN can be contacted at [email protected] or (646) 200-8885.
• For media inquiries, contact Chris Gillick at [email protected] or (646) 677-1819.
• MRCC investor relations: Mick Solimene, Chief Financial Officer & Chief Investment Officer, [email protected], (312) 598-8401.

Summary Transaction Terms

• MRCC will make a one-time \$13 million cash distribution.
• HRZN plans to supplement monthly distributions for two quarters post-merger, funded by \$27.6 million of undistributed taxable earnings.
• Exchange ratio to be determined by NAV per share at closing.
• HRZN Board will assess regulatory and financial compliance before declaring distributions.

Disclaimer: This article is for informational purposes only and does not constitute investment advice, solicitation, or an offer to buy or sell any securities. All forward-looking statements are subject to risks and uncertainties, and actual results may differ materially from those anticipated. Investors are advised to review official SEC filings and consult with their financial advisors before making any investment decisions.

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