UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant
to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): January 12, 2016
Hercules Technology Growth Capital, Inc.
(Exact name of registrant as specified in its charter)
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Maryland |
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814-00702 |
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74-3113410 |
(State or other jurisdiction
of incorporation) |
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(Commission
File No.) |
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(I.R.S. Employer
Identification No.) |
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400 Hamilton Ave., Suite 310
Palo Alto, CA |
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94301 |
(Address of principal executive offices) |
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(Zip Code) |
Registrants telephone number, including area code: (650) 289-3060
Not Applicable
(Former
name or address, if changed since last report)
Check the appropriate box below
if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.02 Results of Operations and Financial Condition
On January 12, 2016, Hercules Technology Growth Capital, Inc. issued a press release announcing its fourth quarter portfolio update and select
achievements for 2015.The text of the press release is included as an exhibit to this Form 8-K.
This information disclosed under this Item 2.02
including Exhibit 99.1 hereto, is being furnished and shall not be deemed filed for purposes of Section 18 of the Securities Exchange Act of 1934 and shall not be deemed incorporated by reference into any filing made under the
Securities Act of 1933, except as expressly set forth by specific reference in such filing.
Item 9.01 Financial Statements and Exhibits
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99.1 |
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Press Release dated January 12, 2016 |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
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HERCULES TECHNOLOGY GROWTH CAPITAL, INC. |
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January 13, 2016 |
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By: |
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/s/ Manuel Henriquez |
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Manuel Henriquez |
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Chief Executive Officer |
EXHIBIT INDEX
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Exhibit No. |
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Description of Exhibits |
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99.1 |
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Press Release dated January 12, 2016 |
Exhibit 99.1
Hercules Announces Q4 Portfolio Update and
Select Achievements for 2015
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~$745.3 million in Total Debt and Equity Commitments |
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15 Portfolio Companies Complete IPO and/or M&A Liquidity Events |
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Record Level of Scheduled and Unscheduled Principal Repayments of ~$503.7 million in Fiscal Year 2015 |
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Outstanding Management of Total Unfunded Commitments to $115.9 million by end of Q4 2015, Significantly Down from a Peak of $413.9 million in Q2 2015 |
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Combined $60.0 million redemption of the 7.00% 2019 Notes in 2015; $40.0 million completed in Q4 2015 resulting in an annual interest expense savings of ~$3.0 million, or $0.04 Net Investment Income
NII per share on an annual basis |
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In December 2015 extended the Wells Fargo Credit Facility, under which Wells Fargo & Company has committed $75.0 million through August 2018 at the same terms |
Palo Alto, Calif., January 12, 2016 Hercules Technology Growth Capital, Inc. (NYSE: HTGC), the leading specialty financing provider
to innovative venture growth, pre-IPO and M&A stage companies backed by leading venture capital firms, today announced its Q4 2015 portfolio update and select achievements for 2015.
2015 was an outstanding year for Hercules with nearly $750 million in new commitments. Throughout the year, we also made a number of significant new
investments in our organization at all levels to ensure continued growth of our investment portfolio, and access to long-term, cost-effective funding, which we expect will enable Hercules to realize high-quality earnings and earnings growth expected
to cover our dividend for our shareholders for 2016 and beyond, assuming the markets remain favorable for new investments, stated Manuel A. Henriquez, chairman and chief executive officer of Hercules. In addition, during the year we
expanded and added three new independent directors to our board, enhanced our senior management team, and received investment grade corporate ratings from both Standard & Poors and Kroll Bond Rating Agency, Inc.
Henriquez added, We continued to pursue our slow and steady growth strategy, methodically converting our strong liquidity position into new
interest-earning loans to venture growth stage companies, continuing to effectively manage down our unfunded commitments to $115.9 million, while also focusing on lowering our overall cost of funding as we continued to redeem our 7.0% 2019
Notes.
Henriquez concluded, Our originations team continues to demonstrate its incredible tenacity and resiliency by delivering impressive
portfolio growth in the face of record loan repayments for two consecutive years, while at the same time maintaining a high-standard of underwriting discipline as evidenced by our outstanding credit performance. In addition, we continue to be
extremely diligent in optimizing our operating structure to give us significant opportunity to grow our assets and maximize shareholder return. I am very pleased with our execution in 2015, and continue to be very optimistic about our prospects in
2016.
New Commitments for Q4 2015 Total Approximately $116.3 million:
As of December 31, 2015, Hercules has originated ~$116.3 million of debt and equity commitments to new and existing portfolio companies.
Another Record Level of Principal Repayments/Early Pay-Offs:
Hercules received ~$129.4 million in principal repayments for Q4 2015, of which ~$105.7 million was unscheduled early repayments. The
$105.7 million of unscheduled early repayments was higher than we had previously anticipated by ~$30-40 million, and primarily consisted of older term loans carrying lower prepayment fees and income accelerations.
For 2015, Hercules received ~$503.7 million in principal repayments, of which ~$388.7 million were unscheduled early repayments, a record level
for the Company.
Portfolio M&A and IPO Activity in Q4 2015:
M&A Activity
Three (3) Portfolio
Companies Completed M&A Events for Q4 2015:
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In October 2015, AtriCure, Inc. (Nasdaq: ATRC) announced and completed its acquisition of Hercules portfolio company nContact Surgical, Inc. for an upfront payment of 3.7 million shares of AtriCure
common stock, valued at $24.60 per share and approximately $8.0 million in cash. Hercules currently holds 201,439 shares, of preferred warrants, in nContact, as of September 30, 2015. |
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In October 2015, Outerwall Inc. (Nasdaq: OUTR) announced that it had entered into a definitive agreement to acquire Hercules portfolio company Gazelle, Inc. for $18.0 million in cash, less net closing
transactions costs and fees. In December 2015, Outerwall completed the transaction. |
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In November 2015, BlackBerry (NASDAQ: BBRY) completed its acquisition of Hercules portfolio company Good Technology Corporation for $425.0 million in cash. Hercules currently holds 500,000 shares, of common
stock, in Good Technology, as of December 30, 2015. |
IPO Activity
At Year-end 2015, Hercules Had Three (3) Portfolio Companies in IPO Registration:
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As of December 31, 2015, Hercules held warrant and equity positions in three portfolio companies that had confidentially filed Form S-1 Registration Statements under the JOBS Act with the SEC in contemplation of a
potential IPO. Also, in December 2015, Hercules portfolio company Gelesis, Inc. formally withdrew its Form S-1 Registration. |
There can be no assurances that companies that have yet to complete their IPOs will do so.
During Q4 2015, Two (2) Portfolio Companies Completed IPO Liquidity Events:
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In October 2015, Hercules portfolio company Edge Therapeutics, Inc. (Nasdaq: EDGE) completed its initial public offering of 7,315,151 shares of common stock at a public offering price of $11.00 per share.
Hercules currently holds 157,190 shares of common stock and 78,595 shares of warrants in Edge Therapeutics, as of September 30, 2015. |
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In October 2015, Hercules portfolio company Cerecor Inc. (Nasdaq: CERCU) completed its initial public offering of 4.0 million shares of common stock at a public offering price of $6.50 per share.
Hercules currently holds 119,087 and 22,328 shares, of Preferred Series B-1 and warrants, respectively, in Cerecor, as of September 30, 2015. |
About Hercules Technology Growth Capital, Inc.
Hercules Technology Growth Capital, Inc. (NYSE: HTGC) is the leading specialty finance company focused on providing senior secured loans to venture
capital-backed companies in technology-related markets, including technology, biotechnology, life science, and energy & renewable technology, at all stages of development. Since inception (December 2003), Hercules has committed more than
$5.6 billion to over 325 companies and is the lender of choice for entrepreneurs and venture capital firms seeking growth capital financing. Companies interested in learning more about financing opportunities should contact info@htgc.com, or
call 650.289.3060.
Hercules common stock trades on the New York Stock Exchange under the ticker symbol HTGC.
In addition, Hercules has three outstanding bond issuances of 7.00% Senior Notes due April 2019, 7.00% Senior Notes due September 2019, and 6.25% Notes due
July 2024, which trade on the NYSE under the symbols HTGZ, HTGY, and HTGX, respectively.
Forward-Looking Statements
The information disclosed in this press release is made as of the date hereof and reflects Hercules most current assessment of its historical
financial performance. Actual financial results filed with the SEC may differ from those contained herein due to timing delays between the date of this release and confirmation of final audit results. These forward-looking statements are not
guarantees of future performance and are subject to uncertainties and other factors that could cause actual results to differ materially from those expressed in the forward-looking statements including, without limitation, the risks, uncertainties,
including the uncertainties surrounding the current market volatility, and other factors the Company identifies from time to time in its filings with the SEC. Although Hercules believes that the assumptions on which these forward-looking statements
are based are reasonable, any of those assumptions could prove to be inaccurate and, as a result, the forward-looking statements based on those assumptions also could be incorrect. You should not place undue reliance on these forward-looking
statements. The forward-looking statements contained in this release are made as of the date hereof, and Hercules assumes no obligation to update the forward-looking statements for subsequent events.
Contact:
Michael Hara
Investor Relations and Corporate Communications
Hercules
Technology Growth Capital, Inc.
(650) 433-5578 HT-HN
mhara@htgc.com
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