Hercules Capital
HERCULES TECHNOLOGY GROWTH CAPITAL INC (Form: 10-Q, Received: 05/02/2013 16:18:55)
Table of Contents

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

 

FORM 10-Q

 

 

(Mark One)

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
     EXCHANGE ACT OF 1934

For The Quarterly Period Ended March 31, 2013

OR

 

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
     EXCHANGE ACT OF 1934

Commission File Number: 814-00702

 

 

HERCULES TECHNOLOGY GROWTH

CAPITAL, INC.

(Exact Name of Registrant as Specified in its Charter)

 

 

 

Maryland   743113410

(State or Jurisdiction of

Incorporation or Organization)

 

(IRS Employer

Identification No.)

 

400 Hamilton Ave., Suite 310

Palo Alto, California

  94301
(Address of Principal Executive Offices)   (Zip Code)

(650) 289-3060

(Registrant’s Telephone Number, Including Area Code)

 

 

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter periods that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes   x     No   ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this Chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes   ¨     No   ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

 

Large Accelerated Filer   ¨       Accelerated Filer   x
Non-Accelerated Filer   ¨       Smaller Reporting Company   ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes   ¨     No   x

On April 30, 2013, there were 61,554,003 shares outstanding of the Registrant’s common stock, $0.001 par value.

 

 

 


Table of Contents

HERCULES TECHNOLOGY GROWTH CAPITAL, INC.

FORM 10-Q TABLE OF CONTENTS

 

PART I. FINANCIAL INFORMATION

     3   

Item 1.

  

Consolidated Financial Statements

     3   
  

Consolidated Statement of Assets and Liabilities as of March 31, 2013 (unaudited) and December 31, 2012

     3   
  

Consolidated Statement of Operations for the three-month periods ended March 31, 2013 and 2012 (unaudited)

     5   
  

Consolidated Statement of Changes in Net Assets for the three-month periods ended March 31, 2013 and 2012 (unaudited)

     6   
  

Consolidated Statement of Cash Flows for the three-month periods ended March 31, 2013 and 2012 (unaudited)

     7   
  

Consolidated Schedule of Investments as of March 31, 2013 (unaudited)

     8   
  

Consolidated Schedule of Investments as of December 31, 2012

     25   
  

Notes to Consolidated Financial Statements (unaudited)

     40   

Item 2.

  

Management’s Discussion and Analysis of Financial Condition and Results of Operations

     64   

Item 3.

  

Quantitative and Qualitative Disclosures About Market Risk

     92   

Item 4.

  

Controls and Procedures

     94   

PART II. OTHER INFORMATION

     95   

Item 1.

  

Legal Proceedings

     95   

Item 1A.

  

Risk Factors

     95   

Item 2.

  

Unregistered Sales of Equity Securities and Use of Proceeds

     97   

Item 3.

  

Defaults Upon Senior Securities

     97   

Item 4.

  

Mine Safety Disclosures

     97   

Item 5.

  

Other Information

     97   

Item 6.

  

Exhibits

     97   

SIGNATURES

     98   

 

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Table of Contents

PART I: FINANCIAL INFORMATION

In this Quarterly Report, the “Company,” “Hercules,” “we,” “us” and “our” refer to Hercules Technology Growth Capital, Inc. and its wholly owned subsidiaries and its affiliated securitization trusts unless the context otherwise requires.

 

ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS

HERCULES TECHNOLOGY GROWTH CAPITAL, INC.

CONSOLIDATED STATEMENT OF ASSETS AND LIABILITIES

(unaudited)

(dollars in thousands, except per share data)

 

     March 31,
2013
    December 31,
2012
 

Assets

    

Investments:

    

Non-control/Non-affiliate investments (cost of $957,508 and $896,031, respectively)

   $ 953,788      $ 894,428   

Affiliate investments (cost of $20,196 and $18,307, respectively)

     14,196        11,872   
  

 

 

   

 

 

 

Total investments, at fair value (cost of $977,704 and $914,338, respectively)

     967,984        906,300   

Cash and cash equivalents

     206,928        182,994   

Restricted Cash

     810        —     

Interest receivable

     9,674        9,635   

Other assets

     25,790        24,714   
  

 

 

   

 

 

 

Total assets

   $ 1,211,186      $ 1,123,643   
  

 

 

   

 

 

 

Liabilities

    

Accounts payable and accrued liabilities

   $ 8,456      $ 11,575   

Long-term Liabilities (Convertible Senior Note)

     71,707        71,436   

Asset-Backed Notes

     120,051        129,300   

2019 Notes

     170,364        170,364   

Long-term SBA Debentures

     225,000        225,000   
  

 

 

   

 

 

 

Total liabilities

   $ 595,578      $ 607,675   

Commitments and Contingencies (Note 9)

    

Net assets consist of:

    

Common stock, par value

     62        53   

Capital in excess of par value

     660,833        564,508   

Unrealized depreciation on investments

     (8,281     (7,947

Accumulated realized losses on investments

     (34,925     (36,916

Distributions in excess of investment income

     (2,081     (3,730
  

 

 

   

 

 

 

Total net assets

   $ 615,608      $ 515,968   
  

 

 

   

 

 

 

Total liabilities and net assets

   $ 1,211,186      $ 1,123,643   
  

 

 

   

 

 

 

Shares of common stock outstanding ($0.001 par value, 100,000,000 authorized)

     61,554        52,925   

Net asset value per share

   $ 10.00      $ 9.75   

See notes to consolidated financial statements.

 

3


Table of Contents

The following table presents the assets and liabilities of our consolidated variable interest entity (“VIE”). The assets of the VIE can only be used to settle obligations of the consolidated VIE, and the creditors (or beneficial interest holders) do not have recourse to our general credit. These assets and liabilities are included in the Consolidated Statements of Assets and Liabilities above.

 

(Unaudited, in thousands)

   March 31,
2013
     December 31,
2012
 

ASSETS

     

Restricted Cash

   $ 810       $ —     

Total investments, at fair value (cost of $219,853 and $0, respectively)

     218,142         226,997   
  

 

 

    

 

 

 

Total assets

   $ 218,952       $ 226,997   
  

 

 

    

 

 

 

LIABILITIES

     

Asset-Backed Notes

   $ 120,051       $ 129,300   
  

 

 

    

 

 

 

Total liabilities

   $ 120,051       $ 129,300   
  

 

 

    

 

 

 

See notes to consolidated financial statements.

 

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HERCULES TECHNOLOGY GROWTH CAPITAL, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited)

(in thousands, except per share data)

 

     Three Months Ended March 31,  
           2013             2012      

Investment income:

    

Interest Income

    

Non-control/Non-affiliate investments

   $ 28,319      $ 20,281   

Affiliate investments

     610        6   

Control investments

     —          13   
  

 

 

   

 

 

 

Total interest income

     28,929        20,300   
  

 

 

   

 

 

 

Fees

    

Non-control/Non-affiliate investments

     2,028        2,067   
  

 

 

   

 

 

 

Total fees

     2,028        2,067   
  

 

 

   

 

 

 

Total investment income

     30,957        22,367   
  

 

 

   

 

 

 

Operating expenses:

    

Interest

     7,631        3,896   

Loan fees

     1,079        1,076   

General and administrative

     2,252        1,817   

Employee Compensation:

    

Compensation and benefits

     3,798        3,395   

Stock-based compensation

     1,165        808   
  

 

 

   

 

 

 

Total employee compensation

     4,963        4,203   
  

 

 

   

 

 

 

Total operating expenses

     15,925        10,992   
  

 

 

   

 

 

 

Net investment income

     15,032        11,375   

Net realized (losses) gains on investments

    

Non-control/Non-affiliate investments

     1,991        2,877   
  

 

 

   

 

 

 

Total net realized (loss) gain on investments

     1,991        2,877   

Net unrealized (depreciation) appreciation on investments

    

Non-control/Non-affiliate investments

     (768     1,751   

Affiliate investments

     434        1,076   

Control investments

     —          26   
  

 

 

   

 

 

 

Total net unrealized (depreciation) appreciation on investments

     (334     2,853   
  

 

 

   

 

 

 

Total net realized (unrealized) gain

     1,657        5,730   

Net increase in net assets resulting from operations

   $ 16,689      $ 17,105   

Net investment income before investment gains and losses per common share:

    

Basic

   $ 0.27      $ 0.24   

Change in net assets per common share:

    

Basic

   $ 0.30      $ 0.36   

Diluted

   $ 0.30      $ 0.36   

Weighted average shares outstanding

    

Basic

     53,682        47,018   

Diluted

     53,823        47,210   

See notes to consolidated financial statements.

 

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HERCULES TECHNOLOGY GROWTH CAPITAL, INC.

CONSOLIDATED STATEMENT OF CHANGES IN NET ASSETS

(unaudited)

(dollars and shares in thousands)

 

    Common Stock     Capital  in
excess

of par value
    Unrealized
Appreciation

on Investments
    Accumulated
Realized
Gains (Losses)

on Investments
    Distributions
in  Excess of
Investment

Income
    Provision  for
Income Taxes
on  Investment
Gains
    Net
Assets
 
    Shares     Par Value              

Balance at December 31, 2011

    43,853      $ 44      $ 484,244      $ (3,431   $ (43,042   $ (6,432   $ (342   $ 431,041   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net increase in net assets resulting from operations

    —          —          —          2,853        2,877        11,375        —          17,105   

Issuance of common stock

    5,425        5        49,773        —          —          —          —          49,778   

Issuance of common stock under restricted stock plan

    620        1        —          —          —          —          —          1   

Issuance of common stock as stock dividend

    62        —          670        —          —          —          —          670   

Retired shares from net issuance

    (239     —          (2,562     —          —          —          —          (2,562

Dividends declared

    —          —          —          —          —          (11,412     —          (11,412

Stock-based compensation

    —          —          826        —          —          —          —          826   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Balance at March 31, 2012

    49,721      $ 50      $ 532,951      $ (578   $ (40,165   $ (6,469   $ (342   $ 485,447   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Balance at December 31, 2012

    52,925      $ 53      $ 564,509      $ (7,947   $ (36,916   $ (3,389   $ (342   $ 515,968   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net increase in net assets resulting from operations

    —          —          —          (334     1,991        15,032        —          16,689   

Issuance of common stock

    80        —          910        —          —          —          —          910   

Issuance of common stock under restricted stock plan

    531        1        (1     —          —          —          —          —     

Issuance of common stock as stock dividend

    40        —          488        —          —          —          —          488   

Retired shares from net issuance

    (72     —          (1,808     —          —          —          —          (1,808

Public Offering

    8,050        8        95,550        —          —          —          —          95,558   

Dividends declared

    —          —          —          —          —          (13,382     —          (13,382

Stock-based compensation

    —          —          1,185        —          —          —          —          1,185   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Balance at March 31, 2013

    61,554      $ 62      $ 660,833      $ (8,281   $ (34,925   $ (1,739   $ (342   $ 615,608   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

See notes to consolidated financial statements.

 

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HERCULES TECHNOLOGY GROWTH CAPITAL, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited)

(dollars in thousands)

 

     For the Three Months Ended
March 31,
 
     2013     2012  

Cash flows from operating activities:

    

Net increase in net assets resulting from operations

   $ 16,689      $ 17,105   

Adjustments to reconcile net increase in net assets resulting from operations to net cash used in operating activities:

    

Purchase of investments

     (139,095     (64,961

Principal payments received on investments

     75,987        35,533   

Proceeds from sale of investments

     5,212        8,726   

Net unrealized (appreciation) / depreciation on investments

     334        (2,853

Net realized (gain) / loss on investments

     (1,991     (2,877

Accretion of paid-in-kind principal

     (555     (280

Accretion of loan discounts

     (1,455     (916

Accretion of loan discount on Convertible Senior Notes

     271        271   

Accretion of loan exit fees

     (1,819     (2,685

Change in deferred loan origination revenue

     313        (198

Unearned fees related to unfunded commitments

     (856     (2,360

Amortization of debt fees and issuance costs

     938        913   

Depreciation

     68        71   

Stock-based compensation and amortization of restricted stock grants

     1,185        826   

Change in operating assets and liabilities:

    

Interest and fees receivable

     (41     (143

Prepaid expenses and other assets

     33        (75

Accounts payable

     (250     (51

Accrued liabilities

     (2,682     (3,733
  

 

 

   

 

 

 

Net cash used in operating activities

     (47,714     (17,687

Cash flows from investing activities:

    

Purchases of capital equipment

     (24     (12

Investment in restricted cash

     (810     —     

Other long-term assets

     (30     —     
  

 

 

   

 

 

 

Net cash used in investing activities

     (864     (12

Cash flows from financing activities:

    

Proceeds from issuance of common stock, net

     94,660        47,218   

Dividends paid

     (12,894     (10,742

Repayments of credit facilities

     (9,254     (34,818
  

 

 

   

 

 

 

Net cash provided by financing activities

     72,512        1,658   

Net increase / (decrease) in cash

     23,934        (16,041

Cash and cash equivalents at beginning of year

     182,994        64,474   
  

 

 

   

 

 

 

Cash and cash equivalents at end of year

   $ 206,928      $ 48,433   
  

 

 

   

 

 

 

See notes to consolidated financial statements.

 

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Table of Contents

HERCULES TECHNOLOGY GROWTH CAPITAL, INC.

CONSOLIDATED SCHEDULE OF INVESTMENTS

March 31, 2013

(unaudited)

(dollars in thousands)

 

Portfolio Company

 

Sub-Industry

 

Type of Investment (1)

  Principal
Amount
    Cost (2)     Value (3)  

Maturity: Upon Liquidation

     

Paratek Pharmaceuticals, Inc.

  Drug Discovery & Development   Senior Debt (9)      
   

Matures upon liquidation

Interest rate Fixed 10.00%

  $ 45      $ 45      $ 45   
    Senior Debt (9)      
   

Matures upon liquidation

Interest rate Fixed 10.00%

  $ 36        31        31   
    Senior Debt (9)      
   

Matures upon liquidation

No initial interest rate

  $ 28        28        28   
       

 

 

   

 

 

 

Total Paratek Pharmaceuticals, Inc.

          104        104   

Maturity: Under 1 Year Maturity

     

Chroma Therapeutics, Ltd. (5)(10)

  Drug Discovery & Development     Senior Debt      
   

Matures November 2013

Interest rate Prime + 7.75% or

Floor rate of 12.00%

  $ 3,007        3,714        3,675   

Maturity: 1-5 Years Maturity

     

ADMA Biologics, Inc.

  Drug Discovery & Development   Senior Debt      
   

Matures April 2016

Interest rate Prime + 2.75% or

Floor rate of 8.50%

  $ 5,000        4,844        4,844   

Anthera Pharmaceuticals Inc. (3)

  Drug Discovery & Development   Senior Debt (11)      
   

Matures December 2014

Interest rate Prime + 7.30% or

Floor rate of 10.55%

  $ 18,199        18,574        18,574   

Aveo Pharmaceuticals, Inc. (3)

  Drug Discovery & Development   Senior Debt (11)      
   

Matures September 2015

Interest rate Prime + 7.15% or

Floor rate of 11.90%

  $ 26,500        26,500        27,030   

Cell Therapeutics, Inc. (3)

  Drug Discovery & Development   Senior Debt      
   

Matures October 2016

Interest rate Prime + 9.00% or

Floor rate of 12.25%

  $ 10,000        9,670        9,670   

Cempra, Inc. (3)

  Drug Discovery & Development   Senior Debt (11)      
   

Matures December 2015

Interest rate Prime + 6.30% or

Floor rate of 9.55%

  $ 10,000        9,898        9,815   

Concert Pharmaceuticals, Inc.

  Drug Discovery & Development   Senior Debt (4)      
   

Matures October 2015

Interest rate Prime + 3.25% or

Floor rate of 8.50%

  $ 20,000        19,687        18,946   

Coronado BioSciences, Inc. (3)

  Drug Discovery & Development   Senior Debt (11)      
   

Matures March 2016

Interest rate Prime + 6.00% or

Floor rate of 9.25%

  $ 15,000        14,838        14,430   

Dicerna Pharmaceuticals, Inc.

  Drug Discovery & Development   Senior Debt      
   

Matures January 2015

Interest rate Prime + 4.40% or

Floor rate of 10.15%

  $ 8,168        8,039        7,921   

Insmed, Inc.

  Drug Discovery & Development   Senior Debt (11)      
   

Matures January 2016

Interest rate Prime + 4.75% or

Floor rate of 9.25%

  $ 20,000        19,438        19,498   

Merrimack Pharmaceuticals, Inc.

  Drug Discovery & Development   Senior Debt      
   

Matures May 2016

Interest rate Prime + 5.30% or

Floor rate of 10.55%

  $ 40,000        39,840        39,840   

See notes to consolidated financial statements.

 

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Table of Contents

HERCULES TECHNOLOGY GROWTH CAPITAL, INC.

CONSOLIDATED SCHEDULE OF INVESTMENTS—(Continued)

March 31, 2013

(unaudited)

(dollars in thousands)

 

Portfolio Company

 

Sub-Industry

 

Type of Investment (1)

  Principal
Amount
    Cost (2)     Value (3)  

Neuralstem, Inc. (3)

  Drug Discovery & Development   Senior Debt      
   

Matures June 2016

Interest rate Prime + 7.75% or

Floor rate of 11.00%

  $ 8,000      $ 7,654      $ 7,654   

NeurogesX, Inc. (3)

  Drug Discovery & Development   Senior Debt      
   

Matures February 2015

Interest rate Prime + 7.50% or

Floor rate of 10.75%

  $ 4,041        4,429        4,397   
       

 

 

   

 

 

 

Total Debt Drug Discovery & Development (30.28%)*

      187,229        186,398   
       

 

 

   

 

 

 

Maturity: Under 1 Year Maturity

     

PeerApp, Inc.

  Communications & Networking   Senior Debt (4)      
   

Matures April 2013

Interest rate Prime + 7.50% or

Floor rate of 11.50%

  $ 159        248        248   

Maturity: 1-5 Years Maturity

     

Bridgewave Communications

  Communications & Networking   Senior Debt      
   

Matures March 2016

Interest rate Fixed 8.00%

  $ 7,500        7,163        4,369   

OpenPeak, Inc.

  Communications & Networking   Senior Debt (11)      
   

Matures July 2015

Interest rate Prime + 8.75% or

Floor rate of 12.00%

  $ 14,129        14,330        14,472   

UPH Holdings, Inc. (8)

  Communications & Networking   Senior Debt      
   

Matures April 2015

Interest rate Libor + 11.00% or

Floor rate of 13.50%

  $ 6,600        6,489        3,478   
   

Senior Debt

     
   

Matures September 2015

Interest rate Libor + 11.00% or

Floor rate of 13.50%

  $ 338        333        178   
   

Senior Debt

     
   

Matures January 2017

Interest rate Libor + 11.00% or

Floor rate of 13.50%

  $ 3,594        3,594        1,894   
       

 

 

   

 

 

 

Total UPH Holdings, Inc.

          10,416        5,550   
       

 

 

   

 

 

 

Total Debt Communications & Networking (4.00%)*

      32,157        24,639   
       

 

 

   

 

 

 

Maturity: 1-5 Years Maturity

     

Clustrix, Inc.

  Electronics & Computer Hardware   Senior Debt      
   

Matures December 2015

Interest rate Prime + 6.50% or

Floor rate of 9.75%

  $ 696        669        678   

Identive Group, Inc.

  Electronics & Computer Hardware   Senior Debt      
   

Matures November 2015

Interest rate Prime + 7.75% or

Floor rate 11.00%

  $ 7,500        7,562        7,562   

OCZ Technology Group, Inc. (3)

  Electronics & Computer Hardware   Senior Debt      
   

Matures April 2016

Interest rate Prime + 8.75% or

Floor rate of 12.50%,

PIK Interest 3.00%

  $ 10,000        9,473        9,473   
       

 

 

   

 

 

 

Total Debt Electronics & Computer Hardware (2.88%)

      17,704        17,713   
       

 

 

   

 

 

 

Maturity: Upon Liquidation

     

Tada Innovations, Inc.

  Software   Senior Debt (9)      
   

Matures upon liquidation

Interest rate Fixed 8.00%

  $ 100        100        —     

 

See notes to consolidated financial statements.

 

9


Table of Contents

HERCULES TECHNOLOGY GROWTH CAPITAL, INC.

CONSOLIDATED SCHEDULE OF INVESTMENTS—(Continued)

March 31, 2013

(unaudited)

(dollars in thousands)

 

Portfolio Company

 

Sub-Industry

 

Type of Investment (1)

  Principal
Amount
    Cost (2)     Value (3)  

Maturity: 1-5 Years Maturity

     

Box, Inc.

  Software   Senior Debt (4)      
   

Matures March 2016

Interest rate Prime + 3.75% or

Floor rate of 7.50%

  $ 10,000      $ 9,947      $ 9,513   
   

Senior Debt (4)

     
   

Matures July 2014

Interest rate Prime + 5.25% or

Floor rate of 8.50%

  $ 866        930        919   
   

Senior Debt (11)

     
   

Matures July 2016

Interest rate Prime + 5.13% or

Floor rate of 8.88%

  $ 20,000        20,211        19,574   
       

 

 

   

 

 

 

Total Box, Inc.

          31,088        30,006   

Clickfox, Inc.

  Software   Senior Debt      
   

Matures November 2015

Interest rate Prime + 8.25% or

Floor rate of 11.50%

  $ 7,788        7,209        7,443   

EndPlay,Inc.

  Software   Senior Debt      
   

Matures August 2015

Interest rate Prime + 7.35% or

Floor rate 10.6%

  $ 2,000        1,945        1,945   

Hillcrest Laboratories, Inc

  Software   Senior Debt      
   

Matures July 2015

Interest rate Prime + 7.50% or

Floor rate of 10.75%

  $ 3,764        3,701        3,664   

JackBe Corporation

  Software   Senior Debt      
   

Matures January 2016

Interest rate Prime + 7.25% or

Floor rate of 10.50%

  $ 3,000        2,922        2,929   

Kxen, Inc.

  Software   Senior Debt (4)      
   

Matures January 2015

Interest rate Prime + 5.08% or

Floor rate of 8.33%

  $ 2,078        2,126        1,980   

Neos Geosolutions, Inc.

  Software   Senior Debt      
   

Matures May 2016

Interest rate Prime + 5.75% or

Floor rate of 9.50%

  $ 4,000        3,955        3,955   
       

 

 

   

 

 

 

Total Debt Software (8.44%)*

      53,046        51,922   
       

 

 

   

 

 

 

Maturity: Under 1 Year Maturity

     

Althea Technologies, Inc.

  Specialty Pharmaceuticals   Senior Debt      
   

Matures October 2013

Interest rate Prime + 7.70% or

Floor rate of 10.95%

  $ 6,933        7,285        7,285   

Quatrx Pharmaceuticals Company

  Specialty Pharmaceuticals   Senior Debt (9)      
   

Matures March 2014

Interest rate Fixed 8.00%

  $ 1,888        1,888        2,767   
       

 

 

   

 

 

 

Total Debt Specialty Pharmaceuticals (1.63%)*

      9,173        10,052   
       

 

 

   

 

 

 

Maturity: 1-5 Years Maturity

     

Achronix Semiconductor Corporation

  Semiconductors   Senior Debt      
   

Matures January 2015

Interest rate Prime + 10.60% or

Floor rate of 13.85%

  $ 1,653        1,618        1,602   
       

 

 

   

 

 

 

Total Debt Semiconductors (0.26%)*

      1,618        1,602   
       

 

 

   

 

 

 

 

See notes to consolidated financial statements.

 

10


Table of Contents

HERCULES TECHNOLOGY GROWTH CAPITAL, INC.

CONSOLIDATED SCHEDULE OF INVESTMENTS—(Continued)

March 31, 2013

(unaudited)

(dollars in thousands)

 

Portfolio Company

 

Sub-Industry

 

Type of Investment (1)

  Principal
Amount
    Cost (2)     Value (3)  

Maturity: Under 1 Year Maturity

     

Alexza Pharmaceuticals, Inc. (3)

  Drug Delivery   Senior Debt (11)      
   

Matures October 2013

Interest rate Prime + 6.50% or

Floor rate of 10.75%

  $ 3,594      $ 3,994      $ 3,994   

Maturity: 1-5 Years Maturity

         

AcelRX Pharmaceuticals, Inc. (3)

  Drug Delivery   Senior Debt (11)      
   

Matures December 2014

Interest rate Prime + 3.25% or

Floor rate of 8.50%

  $ 14,452        14,402        14,108   

BIND Therapeutics, Inc.

  Drug Delivery   Senior Debt      
   

Matures July 2014

Interest rate Prime + 7.45% or

Floor rate of 10.70%

  $ 2,838        2,875        2,926   

Intelliject, Inc.

  Drug Delivery   Senior Debt (11)      
   

Matures June 2016

Interest rate Prime + 5.75% or

Floor rate of 11.00%

  $ 15,000        14,705        15,155   

Nupathe, Inc. (3)

  Drug Delivery   Senior Debt      
   

Matures May 2016

Interest rate Prime - 3.25% or

Floor rate of 9.85%

  $ 8,500        8,220        8,220   

Revance Therapeutics, Inc.

  Drug Delivery   Senior Debt      
   

Matures March 2015

Interest rate Prime + 6.60% or

Floor rate of 9.85%

  $ 16,594        16,582        16,379   
       

 

 

   

 

 

 

Total Debt Drug Delivery (9.87%)*

      60,778        60,782   
       

 

 

   

 

 

 

Maturity: Under 1 Year Maturity

       

Loku, Inc.

  Internet Consumer & Business Services   Senior Debt (9)      
   

Matures June 2013

Interest rate Fixed 6.00%

  $ 100        100        100   

Tectura Corporation

  Internet Consumer & Business Services   Revolving Line of Credit      
   

Matures July 2013

Interest rate LIBOR + 8.00% or

Floor rate of 11.00%

  $ 16,340        18,033        17,663   
   

Senior Debt

     
   

Matures April 2013

Interest rate LIBOR + 10.00% or

Floor rate of 13.00%

  $ 563        553        553   
   

Senior Debt

     
   

Matures July 2013

Interest rate LIBOR + 10.00% or

Floor rate of 13.00%

  $ 1,000        1,000        1,000   
     

 

 

   

 

 

   

 

 

 

Total Tectura Corporation

          19,586        19,216   

Maturity: 1-5 Years Maturity

     

Ahhha, Inc. (8)

  Internet Consumer & Business Services   Senior Debt      
   

Matures January 2015

Interest rate Fixed 12.00%

  $ 350        347        —     

Blurb, Inc.

  Internet Consumer & Business Services   Senior Debt      
   

Matures December 2015

Interest rate Prime + 5.25% or

Floor rate 8.50%

  $ 8,000        7,749        7,547   

Education Dynamics, LLC

  Internet Consumer & Business Services   Senior Debt      
   

Matures March 2016

Interest rate Fixed 12.50%,

PIK Interest 1.50%

  $ 26,750        26,386        25,563   

 

See notes to consolidated financial statements.

 

11


Table of Contents

HERCULES TECHNOLOGY GROWTH CAPITAL, INC.

CONSOLIDATED SCHEDULE OF INVESTMENTS—(Continued)

March 31, 2013

(unaudited)

(dollars in thousands)

 

Portfolio Company

 

Sub-Industry

 

Type of Investment (1)

  Principal
Amount
    Cost (2)     Value (3)  

Just.Me, Inc.

  Internet Consumer & Business Services   Senior Debt      
   

Matures June 2015

Interest rate Prime + 2.50% or

Floor rate 5.75%

  $ 750      $ 737      $ 689   
   

Senior Debt

     
   

Matures June 2015

Interest rate Prime + 5.00% or

Floor rate 8.25%

  $ 750        732        709   
     

 

 

   

 

 

   

 

 

 

Total Just.Me, Inc.

          1,469        1,398   

NetPlenish, Inc.

  Internet Consumer & Business Services   Senior Debt      
   

Matures April 2015

Interest rate Fixed 10.00%

  $ 500        492        460   

Reply! Inc.

  Internet Consumer & Business Services   Senior Debt (11)      
   

Matures September 2015

Interest rate Prime + 6.875% or

Floor rate of 10.125%

  $ 11,749        11,638        11,525   
   

Senior Debt (11)

     
   

Matures September 2015

Interest rate Prime + 7.25% or

Floor rate of 11.00%

  $ 2,000        1,957        2,005   
   

Senior Debt

     
   

Matures February 2016

Interest rate Prime + 7.25% or

Floor rate of 10.50%

  $ 3,000        2,977        2,977   
     

 

 

   

 

 

   

 

 

 

Total Reply! Inc.

          16,572        16,507   

Second Rotation, Inc.

  Internet Consumer & Business Services   Senior Debt      
   

Matures April 2016

Interest rate Prime + 7.00% or

Floor rate of 10.25%,

PIK interest 2.50%

  $ 12,142        12,013        12,013   

ShareThis, Inc.

  Internet Consumer & Business Services   Senior Debt      
   

Matures June 2016

Interest rate Prime + 7.50% or

Floor rate of 10.75%

  $ 15,000        14,349        14,349   

Tectura Corporation

  Internet Consumer & Business Services   Senior Debt      
   

Matures December 2014

Interest rate LIBOR + 10.00% or

Floor rate of 13.00%

  $ 6,468        6,412        6,230   

Trulia, Inc. (3)

  Internet Consumer & Business Services   Senior Debt (11)      
   

Matures September 2015

Interest rate Prime + 2.75% or

Floor rate of 6.00%

  $ 5,000        4,934        4,794   
   

Senior Debt (11)

     
   

Matures September 2015

Interest rate Prime + 5.50% or

Floor rate of 8.75%

  $ 5,000        4,933        4,640   
     

 

 

   

 

 

   

 

 

 

Total Trulia, Inc.

          9,867        9,434   

Vaultlogix, Inc.

  Internet Consumer & Business Services   Senior Debt      
   

Matures September 2016

Interest rate LIBOR + 8.50% or

Floor rate of 10.00%,

PIK interest 2.50%

  $ 7,500        7,740        7,680   
   

Senior Debt

     
   

Matures September 2015

Interest rate LIBOR + 7.00% or

Floor rate of 8.50%

  $ 9,903        9,864        9,580   
       

 

 

   

 

 

 

Total Vaultlogix, Inc.

          17,604        17,260   

 

See notes to consolidated financial statements.

 

12


Table of Contents

HERCULES TECHNOLOGY GROWTH CAPITAL, INC.

CONSOLIDATED SCHEDULE OF INVESTMENTS—(Continued)

March 31, 2013

(unaudited)

(dollars in thousands)

 

Portfolio Company

 

Sub-Industry

 

Type of Investment (1)

  Principal
Amount
    Cost (2)     Value (3)  

Wavemarket, Inc.

  Internet Consumer & Business Services   Senior Debt (11)      
   

Matures September 2015

Interest rate Prime + 5.75% or

Floor rate of 9.50%

  $ 10,000      $ 9,876      $ 9,458   
       

 

 

   

 

 

 

Total Debt Internet Consumer & Business Services (22.67%)*

      142,822        139,535   
       

 

 

   

 

 

 

Maturity: Under 1 Year Maturity

       

InXpo, Inc.

  Information Services   Senior Debt      
   

Matures March 2014

Interest rate Prime + 7.50% or

Floor rate of 10.75%

  $ 2,550        2,432        2,316   

Maturity: 1-5 Years Maturity

       

Cha Cha Search, Inc.

  Information Services   Senior Debt      
   

Matures February 2015

Interest rate Prime + 6.25% or

Floor rate of 9.50%

  $ 2,364        2,334        2,277   

Eccentex Corporation

  Information Services   Senior Debt (11)      
   

Matures May 2015

Interest rate Prime + 7.00% or

Floor rate of 10.25%

  $ 966        949        449   

Jab Wireless, Inc.

  Information Services   Senior Debt      
   

Matures November 2017

Interest rate Prime + 6.75% or

Floor rate of 8.00%

  $ 30,000        29,861        29,850   

RichRelevance, Inc.

  Information Services   Senior Debt      
   

Matures January 2015

Interest rate Prime + 3.25% or

Floor rate of 7.50%

  $ 3,778        3,762        3,661   

Womensforum.com, Inc.

  Information Services   Senior Debt (11)      
   

Matures October 2016

Interest rate LIBOR + 6.50% or

Floor rate of 9.25%

  $ 8,000        7,853        7,853   
   

Senior Debt (11)

     
   

Matures October 2016

Interest rate LIBOR + 7.50% or

Floor rate of 10.25%

  $ 4,500        4,451        4,451   
       

 

 

   

 

 

 

Total Womensforum.com, Inc.

          12,304        12,304   
       

 

 

   

 

 

 

Total Debt Information Services (8.26%)*

      51,642        50,857   
       

 

 

   

 

 

 

Maturity: Upon Liquidation

       

Novasys Medical, Inc.

  Medical Device & Equipment   Senior Debt (9)      
   

Matures upon liquidation

Interest rate Fixed 8.00%

  $ 65        65        65   

Maturity: Under 1 Year Maturity

       

Gynesonics, Inc.

  Medical Device & Equipment   Senior Debt      
   

Matures October 2013

Interest rate Prime + 8.25% or

Floor rate of 11.50%

  $ 3,073        3,178        3,178   

Optiscan Biomedical, Corp. (6)

  Medical Device & Equipment   Senior Debt      
   

Matures December 2013

Interest rate Prime + 8.20% or

Floor rate of 11.45%

  $ 8,260        9,101        9,265   

Oraya Therapeutics, Inc.

  Medical Device & Equipment   Senior Debt (9)      
   

Matures December 2013

Interest rate Fixed 7.00%

  $ 500        500        500   

 

See notes to consolidated financial statements.

 

13


Table of Contents

HERCULES TECHNOLOGY GROWTH CAPITAL, INC.

CONSOLIDATED SCHEDULE OF INVESTMENTS—(Continued)

March 31, 2013

(unaudited)

(dollars in thousands)

 

Portfolio Company

 

Sub-Industry

 

Type of Investment (1)

  Principal
Amount
    Cost (2)     Value (3)  

Maturity: 1-5 Years Maturity

       

Lanx, Inc.

  Medical Device & Equipment   Senior Debt      
   

Matures October 2016

Interest rate Prime + 8.00% or

Floor rate of 11.75%

  $ 15,000      $ 14,651      $ 15,101   
   

Revolving Line of Credit

     
   

Matures October 2015

Interest rate Prime + 6.75% or

Floor rate of 10.50%

  $ 5,500        5,313        5,276   
       

 

 

   

 

 

 

Total Lanx, Inc.

          19,964        20,377   

Medrobotics Corporation

  Medical Device & Equipment   Senior Debt      
   

Matures March 2016

Interest rate Prime + 7.85% or

Floor rate of 11.10%

  $ 5,000        4,766        4,766   

MELA Sciences, Inc.

  Medical Device & Equipment   Senior Debt      
   

Matures November 2016

Interest rate Prime + 7.20% or

Floor rate of 10.45%

  $ 6,000        5,919        5,919   

NinePoint Medical, Inc.

  Medical Device & Equipment   Senior Debt      
   

Matures January 2016

Interest rate Prime + 5.85% or

Floor rate of 9.10%

  $ 7,000        6,805        6,805   

Oraya Therapeutics, Inc.

  Medical Device & Equipment   Senior Debt (11)      
   

Matures September 2015

Interest rate Prime + 5.50% or

Floor rate of 10.25%

  $ 9,711        9,542        9,678   

United Orthopedic Group, Inc.

  Medical Device & Equipment   Senior Debt      
   

Matures July 2016

Interest rate Prime + 8.60% or

Floor rate of 11.85%

  $ 25,000        24,215        24,215   

SonaCare Medical, LLC

  Medical Device & Equipment   Senior Debt (11)      
   

Matures April 2016

Interest rate Prime + 7.75% or

Floor rate of 11.00%

  $ 6,000        5,919        5,855   
       

 

 

   

 

 

 

Total Debt Medical Device & Equipment (14.72%)*

      89,974        90,623   
       

 

 

   

 

 

 

Maturity: 1-5 Years Maturity

       

Navidea Biopharmaceuticals, Inc. (pka Neoprobe) (3)

  Diagnostic   Senior Debt      
   

Matures December 2014

Interest rate Prime + 6.75% or

Floor rate of 10.00%

  $ 5,086        5,086        5,147   

Tethys Bioscience Inc.

  Diagnostic   Senior Debt (11)      
   

Matures December 2015

Interest rate Prime + 8.40% or

Floor rate of 11.65%

  $ 10,000        10,057        9,614   
       

 

 

   

 

 

 

Total Debt Diagnostic (2.40%)*

      15,143        14,761   
       

 

 

   

 

 

 

 

See notes to consolidated financial statements.

 

14


Table of Contents

HERCULES TECHNOLOGY GROWTH CAPITAL, INC.

CONSOLIDATED SCHEDULE OF INVESTMENTS—(Continued)

March 31, 2013

(unaudited)

(dollars in thousands)

 

Portfolio Company

 

Sub-Industry

 

Type of Investment (1)

  Principal
Amount
    Cost (2)     Value (3)  

Maturity: Under 1 Year Maturity

     

Labcyte, Inc.

  Biotechnology Tools   Senior Debt      
   

Matures May 2013

Interest rate Prime + 8.60% or

Floor rate of 11.85%

  $ 315      $ 394      $ 394   

Maturity: 1-5 Years Maturity

     

Labcyte, Inc.

  Biotechnology Tools   Senior Debt (11)      
   

Matures June 2016

Interest rate Prime + 6.70% or

Floor rate of 9.95%

  $ 5,000        4,932        4,980   
       

 

 

   

 

 

 

Total Debt Biotechnology Tools (0.87%)*

      5,326        5,374   
       

 

 

   

 

 

 

Maturity: 1-5 Years Maturity

     

MedCall, LLC

  Healthcare Services, Other   Senior Debt      
   

Matures January 2016

Interest rate 7.79% or

Floor rate of 9.50%

  $ 4,778        4,727        4,606   
    Senior Debt      
   

Matures January 2016

Interest rate LIBOR +8.00% or

Floor rate of 10.00%

  $ 3,931        3,873        3,801   
       

 

 

   

 

 

 

Total MedCall, LLC

          8,600        8,407   

Pacific Child & Family Associates, LLC

  Healthcare Services, Other   Senior Debt      
   

Matures January 2015

Interest rate LIBOR + 8.00% or

Floor rate of 11.50%

  $ 2,737        2,741        2,686   
   

Senior Debt

     
   

Matures January 2015

Interest rate LIBOR + 11.00% or

Floor rate of 14.00%, PIK interest 3.75%

  $ 5,900        6,641        6,382   
       

 

 

   

 

 

 

Total Pacific Child & Family Associates, LLC

          9,382        9,068   

ScriptSave (Medical Security Card Company, LLC)

  Healthcare Services, Other   Senior Debt      
   

Matures February 2016

Interest rate LIBOR + 8.75% or

Floor rate of 11.25%

  $ 14,067        13,893        13,941   
       

 

 

   

 

 

 

Total Debt Health Services, Other (5.10%)*

      31,875        31,416   
       

 

 

   

 

 

 

Maturity: 1-5 Years Maturity

     

Entrigue Surgical, Inc.

  Surgical Devices   Senior Debt      
   

Matures December 2014

Interest rate Prime + 5.90% or

Floor rate of 9.65%

  $ 2,183        2,168        2,171   

Transmedics, Inc.

  Surgical Devices   Senior Debt (11)      
   

Matures November 2015

Interest rate Fixed 12.95%

  $ 7,250        7,097        7,097   
       

 

 

   

 

 

 

Total Debt Surgical Devices (1.51%)*

      9,265        9,268   
       

 

 

   

 

 

 

Maturity: 1-5 Years Maturity

     

Westwood One Communications

  Media/Content/ Info   Senior Debt      
   

Matures October 2016

Interest rate LIBOR + 6.50% or

Floor rate of 8.00%

  $ 19,614        18,253        17,890   

Women’s Marketing, Inc.

  Media/Content/ Info   Senior Debt      
   

Matures May 2016

Interest rate Libor + 9.50% or

Floor rate of 12.00%, PIK interest 3.00%

  $ 9,681        10,092        10,189   
    Senior Debt (11)      
   

Matures November 2015

Interest rate Libor + 7.50% or

Floor rate of 10.00%

  $ 15,612        15,389        15,175   
       

 

 

   

 

 

 

Total Women’s Marketing, Inc.

          25,481        25,364   

 

See notes to consolidated financial statements.

 

15


Table of Contents

HERCULES TECHNOLOGY GROWTH CAPITAL, INC.

CONSOLIDATED SCHEDULE OF INVESTMENTS—(Continued)

March 31, 2013

(unaudited)

(dollars in thousands)

 

Portfolio Company

 

Sub-Industry

 

Type of Investment (1)

  Principal
Amount
    Cost (2)     Value (3)  

Zoom Media Corporation

  Media/Content/ Info   Senior Debt      
   

Matures December 2015

Interest rate Prime + 7.25% or

Floor rate of 10.50%,

PIK interest 3.75%

  $ 5,000      $ 4,738      $ 4,738   
  Media/Content/ Info   Revolving Line of Credit      
   

Matures December 2014

Interest rate Prime + 5.25% or

Floor rate of 8.50%

  $ 3,500        3,238        3,238   
       

 

 

   

 

 

 

Total Zoom Media Corporation

          7,976        7,976   
       

 

 

   

 

 

 

Total Debt Media/Content/Info (8.32%)*

      51,710        51,230   
       

 

 

   

 

 

 

Maturity: Under 1 Year Maturity

     

BrightSource Energy, Inc.

  Clean Tech   Senior Debt      
   

Matures January 2014

Interest rate Prime + 8.25% or

Floor rate of 11.50%

  $ 35,000        34,645        34,645   

Solexel, Inc.

  Clean Tech   Senior Debt      
   

Matures June 2013

Interest rate Prime + 8.25% or

Floor rate of 11.50%

  $ 1,476        1,474        1,474   
   

Senior Debt

     
   

Matures June 2013

Interest rate Prime + 7.25% or

Floor rate of 10.50%

  $ 169        169        169   
       

 

 

   

 

 

 

Total Solexel, Inc.

          1,643        1,643   

Maturity: 1-5 Years Maturity

     

Alphabet Energy, Inc.

  Clean Tech   Senior Debt      
   

Matures February 2015

Interest rate Prime + 5.75% or

Floor rate of 9.00%

  $ 1,772        1,679        1,679   

American Supercondutor Corporation (3)

  Clean Tech   Senior Debt (11)      
   

Matures December 2014

Interest rate Prime + 7.25% or

Floor rate of 11.00%

  $ 8,077        8,139        8,344   

Comverge, Inc.

  Clean Tech   Senior Debt      
   

Matures November 2017

Interest rate LIBOR + 8.00% or

Floor rate of 9.50%

  $ 20,000        19,605        19,605   
  Clean Tech   Senior Debt      
   

Matures November 2017

Interest rate LIBOR + 9.50% or

Floor rate of 11.00%

  $ 14,000        13,754        13,754   
       

 

 

   

 

 

 

Total Comverge, Inc.

          33,359        33,359   

Enphase Energy, Inc. (3)

  Clean Tech   Senior Debt (11)      
   

Matures June 2014

Interest rate Prime + 5.75% or

Floor rate of 9.00%

  $ 3,167        3,169        3,135   
  Clean Tech   Senior Debt      
   

Matures August 2016

Interest rate Prime + 8.25% or

Floor rate of 11.50%

  $ 7,400        7,353        7,353   
       

 

 

   

 

 

 

Total Enphase Energy, Inc.

          10,522        10,488   

Glori Energy, Inc.

  Clean Tech   Senior Debt (11)      
   

Matures June 2015

Interest rate Prime + 6.75% or

Floor rate of 10.00%

  $ 8,000        7,913        7,961   

Integrated Photovoltaics, Inc.

  Clean Tech   Senior Debt      
   

Matures February 2015

Interest rate Prime + 7.38% or

Floor rate of 10.63%

  $ 2,305        2,239        2,237   

 

See notes to consolidated financial statements.

 

16


Table of Contents

HERCULES TECHNOLOGY GROWTH CAPITAL, INC.

CONSOLIDATED SCHEDULE OF INVESTMENTS—(Continued)

March 31, 2013

(unaudited)

(dollars in thousands)

 

Portfolio Company

 

Sub-Industry

 

Type of Investment (1)

  Principal
Amount
    Cost (2)     Value (3)  

Polyera Corporation

  Clean Tech   Senior Debt      
   

Matures June 2016

Interest rate Prime + 6.75% or

Floor rate of 10.00%

  $ 3,000      $ 2,971      $ 2,971   

Redwood Systems, Inc.

  Clean Tech   Senior Debt      
   

Matures February 2016

Interest rate Prime + 6.50% or

Floor rate of 9.75%

  $ 5,000        4,993        4,993   

SCIenergy, Inc.

  Clean Tech   Senior Debt (4 )      
   

Matures September 2015

Interest rate Prime + 8.75% or

Floor rate 12.00%

  $ 5,296        5,194        5,353   

Stion Corporation

  Clean Tech   Senior Debt (4)      
   

Matures February 2015

Interest rate Prime + 6.75% or

Floor rate of 10.00%

  $ 6,732        6,765        6,754   

TAS Energy, Inc.

  Clean Tech   Senior Debt      
   

Matures February 2015

Interest rate Prime + 7.75% or

Floor rate of 11.00%

  $ 10,000        9,630        9,630   
    Senior Debt      
   

Matures February 2015

Interest rate Prime + 6.25% or

Floor rate of 9.50%

  $ 5,000        4,782        4,782   
       

 

 

   

 

 

 

Total TAS Energy, Inc.

          14,412        14,412   
       

 

 

   

 

 

 

Total Debt Clean Tech (21.90%)*

      134,474        134,839   
       

 

 

   

 

 

 
         
       

 

 

   

 

 

 

Total Debt (143.11%)

        $ 893,936      $ 881,011   
       

 

 

   

 

 

 

 

See notes to consolidated financial statements.

 

17


Table of Contents

HERCULES TECHNOLOGY GROWTH CAPITAL, INC.

CONSOLIDATED SCHEDULE OF INVESTMENTS—(Continued)

March 31, 2013

(unaudited)

(dollars in thousands)

 

Portfolio Company

 

Sub-Industry

 

Type of Investment (1)

 

Series

  Shares     Cost (2)     Value (3)  

ADMA Biologics, Inc.

  Drug Discovery & Development   Common Stock Warrants       25,000      $ 129      $ 115   

Acceleron Pharmaceuticals, Inc.

  Drug Discovery & Development   Common Stock Warrants       46,446        39        55   
    Preferred Stock Warrants   Series B     110,270        35        45   
       

 

 

   

 

 

   

 

 

 

Total Warrants Acceleron Pharmaceuticals, Inc.

          156,716        74        100   

Anthera Pharmaceuticals Inc. (3)

  Drug Discovery & Development   Common Stock Warrants       321,429        984        61   

Cell Therapeutics, Inc. (3)

  Drug Discovery & Development   Common Stock Warrants       679,040        300        322   

Cempra, Inc. (3)

  Drug Discovery & Development   Common Stock Warrants       39,038        187        49   

Chroma Therapeutics, Ltd. (5)(10)

  Drug Discovery & Development   Preferred Stock Warrants   Series D     325,261        490        500   

Concert Pharmaceuticals, Inc.

  Drug Discovery & Development   Preferred Stock Warrants   Series C     400,000        367        133   

Coronado Biosciences, Inc. (3)

  Drug Discovery & Development   Common Stock Warrants       73,009        142        292   

Dicerna Pharmaceuticals, Inc.

  Drug Discovery & Development   Common Stock Warrants       50,000        28        15   
    Preferred Stock Warrants   Series A     525,000        236        161   
    Preferred Stock Warrants   Series B     660,000        311        202   
       

 

 

   

 

 

   

 

 

 

Total Warrants Dicerna Pharmaceuticals, Inc.

          1,235,000        575        378   

 

See notes to consolidated financial statements.

 

18


Table of Contents

HERCULES TECHNOLOGY GROWTH CAPITAL, INC.

CONSOLIDATED SCHEDULE OF INVESTMENTS—(Continued)

March 31, 2013

(unaudited)

(dollars in thousands)

 

Portfolio Company

 

Sub-Industry

 

Type of Investment (1)

 

Series

  Shares     Cost (2)     Value (3)  

EpiCept Corporation (3)

  Drug Discovery & Development     Common Stock Warrants       325,204      $ 4      $ —     

Horizon Pharma, Inc. (3)

  Drug Discovery & Development   Common Stock Warrants       22,408        231        —     

Insmed, Incorporated (3)

  Drug Discovery & Development   Common Stock Warrants       329,931        570        1,482   

Merrimack Pharmaceuticals,
Inc. (3)

  Drug Discovery & Development   Common Stock Warrants       302,143        155        644   

Neuralstem, Inc. (3)

  Drug Discovery & Development   Common Stock Warrants       608,695        295        291   

NeurogesX, Inc. (3)

  Drug Discovery & Development   Common Stock Warrants       3,421,500        503        71   

Portola Pharmaceuticals, Inc.

  Drug Discovery & Development   Preferred Stock Warrants   Series B     687,023        151        268   
         

 

 

   

 

 

 

Total Warrants Drug Discovery & Development (0.76%)*

        5,157        4,706   
         

 

 

   

 

 

 

Bridgewave Communications

  Communications & Networking   Preferred Stock Warrants   Series 5     2,942,618        753        —     

Intelepeer, Inc.

  Communications & Networking   Preferred Stock Warrants   Series C     117,958        102        184   

Neonova Holding Company

  Communications & Networking   Preferred Stock Warrants   Series A     450,000        94        21   

OpenPeak, Inc.

  Communications & Networking   Preferred Stock Warrants   Series E     25,646        149        11   

PeerApp, Inc.

  Communications & Networking   Preferred Stock Warrants   Series B     298,779        61        64   

Peerless Network, Inc.

  Communications & Networking   Preferred Stock Warrants   Series A     135,000        94        384   

Ping Identity Corporation

  Communications & Networking   Preferred Stock Warrants   Series B     1,136,277        52        118   

UPH Holdings, Inc. (8)

  Communications & Networking   Common Stock Warrants       145,877        131        —     

Purcell Systems, Inc.

  Communications & Networking   Preferred Stock Warrants   Series B     110,000        123        69   

Stoke, Inc.

  Communications & Networking   Preferred Stock Warrants   Series C     158,536        53        184   
    Preferred Stock Warrants   Series D     72,727        65        80   
       

 

 

   

 

 

   

 

 

 

Total Stoke, Inc.

          231,263        118        264   
         

 

 

   

 

 

 

Total Warrants Communications & Networking (0.18%)*

        1,677        1,115   
         

 

 

   

 

 

 

Atrenta, Inc.

  Software   Preferred Stock Warrants   Series D     392,670        121        325   

Box, Inc.

  Software   Preferred Stock Warrants   Series C     271,070        117        2,380   
    Preferred Stock Warrants   Series B     199,219        73        3,408   
    Preferred Stock Warrants   Series D-1     62,255        193        319   
       

 

 

   

 

 

   

 

 

 

Total Box, Inc.

          532,544        383        6,107   

Braxton Technologies, LLC.

  Software   Preferred Stock Warrants   Series A     168,750        188        —     

Central Desktop, Inc.

  Software   Preferred Stock Warrants   Series B     522,823        108        186   

Clickfox, Inc.

  Software   Preferred Stock Warrants   Series B     1,038,563        329        364   
    Preferred Stock Warrants   Series C     592,019        730        234   
       

 

 

   

 

 

   

 

 

 

Total Clickfox, Inc.

          1,630,582        1,059        598   

Daegis Inc. (pka Unify
Corporation) (3)

  Software   Common Stock Warrants       718,860        1,434        77   

Endplay, Inc.

  Software   Preferred Stock Warrants   Series B     180,000        67        21   

Forescout Technologies, Inc.

  Software   Preferred Stock Warrants   Series D     399,687        99        348   

Hillcrest Laboratories, Inc.

  Software   Preferred Stock Warrants   Series E     1,865,650        55        54   

JackBe Corporation

  Software   Preferred Stock Warrants   Series C     180,000        73        56   

Kxen, Inc.

  Software   Preferred Stock Warrants   Series D     184,614        47        7   

Neos Geosolutions, Inc.

  Software   Preferred Stock Warrants   Series 3     221,150        22        23   

Rockyou, Inc.

  Software   Preferred Stock Warrants   Series B     41,266        117        —     

SugarSync Inc.

  Software   Preferred Stock Warrants   Series CC     332,726        78        168   
    Preferred Stock Warrants   Series DD     107,526        34        41   
       

 

 

   

 

 

   

 

 

 

Total SugarSync Inc.

          440,252        112        209   

Tada Innovations, Inc.

  Software   Preferred Stock Warrants   Series A     20,833        25        —     

White Sky, Inc.

  Software   Preferred Stock Warrants   Series B-2     124,295        54        3   

WildTangent, Inc.

  Software   Preferred Stock Warrants   Series 3A     100,000        238        55   
         

 

 

   

 

 

 

Total Warrants Software (1.31%)*

        4,202        8,069   
         

 

 

   

 

 

 

 

See notes to consolidated financial statements.

 

19


Table of Contents

HERCULES TECHNOLOGY GROWTH CAPITAL, INC.

CONSOLIDATED SCHEDULE OF INVESTMENTS—(Continued)

March 31, 2013

(unaudited)

(dollars in thousands)

 

Portfolio Company

 

Sub-Industry

 

Type of Investment (1)

 

Series

  Shares     Cost (2)     Value (3)  

Clustrix, Inc.

  Electronics & Computer Hardware   Preferred Stock Warrants   Series B     49,732      $ 12      $ 6   

OCZ Technology Group, Inc. (3)

  Electronics & Computer Hardware   Common Stock Warrants       688,073        619        648   

Shocking Technologies, Inc.

  Electronics & Computer Hardware   Preferred Stock Warrants   Series A-1     181,818        63        201   
         

 

 

   

 

 

 

Total Warrant Electronics & Computer Hardware (0.14%)*

        694        855   
         

 

 

   

 

 

 

Althea Technologies, Inc.

  Specialty Pharmaceuticals   Preferred Stock Warrants   Series D     502,273        309        4,237   

Quatrx Pharmaceuticals Company

  Specialty Pharmaceuticals   Preferred Stock Warrants   Series E     340,534        308        —     
         

 

 

   

 

 

 

Total Warrants Specialty Pharmaceuticals (0.69%)*

        617        4,237   
         

 

 

   

 

 

 

IPA Holdings, LLC

  Consumer & Business Products   Common Stock Warrants       650,000        275        368   

Market Force Information, Inc.

  Consumer & Business Products   Preferred Stock Warrants   Series A     99,286        24        87   

Seven Networks, Inc.

  Consumer & Business Products   Preferred Stock Warrants   Series C     1,821,429        174        80   

ShareThis, Inc.

  Consumer & Business Products   Preferred Stock Warrants   Series B     535,905        547        498   

Wavemarket, Inc.

  Consumer & Business Products   Preferred Stock Warrants   Series E     1,083,333        106        62   
         

 

 

   

 

 

 

Total Warrant Consumer & Business Products (0.18%)*

        1,126        1,095   
         

 

 

   

 

 

 

Achronix Semiconductor Corporation

  Semiconductors   Preferred Stock Warrants   Series D     360,000        160        105   

Enpirion, Inc.

  Semiconductors   Preferred Stock Warrants   Series D     239,872        157        —     

iWatt, Inc.

  Semiconductors   Preferred Stock Warrants   Series C     558,748        46        16   
    Preferred Stock Warrants   Series D     1,954,762        582        316   
       

 

 

   

 

 

   

 

 

 

Total iWatt, Inc.

          2,513,510        628        332   

Kovio Inc.

  Semiconductors   Preferred Stock Warrants   Series B     319,352        92        30   
         

 

 

   

 

 

 

Total Warrants Semiconductors (0.07%)*

        1,037        437   
         

 

 

   

 

 

 

AcelRX Pharmaceuticals, Inc. (3)

  Drug Delivery   Common Stock Warrants       274,508        356        564   

Alexza Pharmaceuticals, Inc. (3)

  Drug Delivery   Common Stock Warrants       37,639        645        2   

BIND Therapeutics, Inc.

  Drug Delivery   Preferred Stock Warrants   Series C-1     150,000        291        422   

Intelliject, Inc.

  Drug Delivery   Preferred Stock Warrants   Series B     82,500        594        965   

NuPathe, Inc. (3)

  Drug Delivery   Common Stock Warrants       106,631        139        166   

Revance Therapeutics, Inc.

  Drug Delivery   Preferred Stock Warrants   Series D     269,663        557        577   

Transcept Pharmaceuticals, Inc. (3)

  Drug Delivery   Common Stock Warrants       61,452        87        55   
         

 

 

   

 

 

 

Total Warrant Drug Delivery (0.45%)*

        2,669        2,751   
         

 

 

   

 

 

 

Blurb, Inc.

  Internet Consumer & Business Services   Preferred Stock Warrants   Series B     439,336        323        318   
    Preferred Stock Warrants   Series C     234,280        636        505   
       

 

 

   

 

 

   

 

 

 

Total Blurb, Inc.

          673,616        959        823   

Invoke Solutions, Inc.

  Internet Consumer & Business Services   Common Stock Warrants       53,084        38        —     

Just.Me

  Internet Consumer & Business Services   Preferred Stock Warrants   Series A     102,299        20        29   

Prism Education Group, Inc.

  Internet Consumer & Business Services   Preferred Stock Warrants   Series B     200,000        43        —     

Reply! Inc.

  Internet Consumer & Business Services   Preferred Stock Warrants   Series B     137,225        320        769   

Second Rotation, Inc.

  Internet Consumer & Business Services   Preferred Stock Warrants   Series D     151,827        165        202   

Tectura Corporation

  Internet Consumer & Business Services   Preferred Stock Warrants   Series B-1     253,378        51        —     
         

 

 

   

 

 

 

Total Warrants Internet Consumer & Business Services (0.30%)*

        1,596        1,823   
         

 

 

   

 

 

 

 

See notes to consolidated financial statements.

 

20


Table of Contents

HERCULES TECHNOLOGY GROWTH CAPITAL, INC.

CONSOLIDATED SCHEDULE OF INVESTMENTS—(Continued)

March 31, 2013

(unaudited)

(dollars in thousands)

 

Portfolio Company

 

Sub-Industry

 

Type of Investment (1)

 

Series

  Shares     Cost (2)     Value (3)  

Buzznet, Inc.

  Information Services   Preferred Stock Warrants   Series B     19,962      $ 9      $ —     

Cha Cha Search, Inc.

  Information Services   Preferred Stock Warrants   Series F     48,232        58        7   

Eccentex Corporation

  Information Services   Preferred Stock Warrants   Series A     408,719        31        —     

Intelligent Beauty, Inc.

  Information Services   Preferred Stock Warrants   Series B     190,234        230        611   

InXpo, Inc.

  Information Services   Preferred Stock Warrants   Series C     648,400        98        32   
    Preferred Stock Warrants   Series C-1     582,015        48        43   
       

 

 

   

 

 

   

 

 

 

Total InXpo, Inc.

          1,230,415        146        75   

Jab Wireless, Inc.

  Information Services   Preferred Stock Warrants   Series A     266,567        265        343   

RichRelevance, Inc.

  Information Services   Preferred Stock Warrants   Series D     112,749        98        39   

Solutionary, Inc.

  Information Services   Preferred Stock Warrants   Series A-2     111,311        96        62   
         

 

 

   

 

 

 

Total Warrants Information Services (0.18%)*

        933        1,137   
         

 

 

   

 

 

 

EKOS Corporation

  Medical Device & Equipment     Preferred Stock Warrants   Series C     4,448,135        327        —     

Gelesis, Inc. (6)

  Medical Device & Equipment     LLC Interest     263,688        78        108   

Lanx, Inc.

  Medical Device & Equipment   Preferred Stock Warrants   Series C     1,203,369        441        755   

Medrobotics Corporation

  Medical Device & Equipment   Preferred Stock Warrants   Series D     424,008        343        404   

NinePoint Medical, Inc.

  Medical Device & Equipment   Preferred Stock Warrants   Series A     350,000        170        204   

Novasys Medical, Inc.

  Medical Device & Equipment   Preferred Stock Warrants   Series D     580,447        131        —     
    Common Stock Warrants       109,449        2        —     
       

 

 

   

 

 

   

 

 

 

Total Novasys Medical, Inc.

          689,896        133        —     

Optiscan Biomedical, Corp. (6)

  Medical Device & Equipment   Preferred Stock Warrants   Series D     6,206,187        1,252        432   

Oraya Therapeutics, Inc.

  Medical Device & Equipment   Preferred Stock Warrants   Series C     716,948        676        266   
    Common Stock Warrants       95,498        66        47   
       

 

 

   

 

 

   

 

 

 

Total Oraya Therapeutics, Inc.

          812,446        742        313   

United Orthopedic Group, Inc.

  Medical Device & Equipment   Preferred Stock Warrants   Series A     423,076        608        599   

SonaCare Medical, LLC

  Medical Device & Equipment   Preferred Stock Warrants   Series G     141,388        188        110   
         

 

 

   

 

 

 

Total Warrants Medical Device & Equipment (0.47%)*

        4,282        2,925   
         

 

 

   

 

 

 

Navidea Biopharmaceuticals, Inc. (pka Neoprobe) (3)

  Diagnostic   Common Stock Warrants       333,333        244        318   

Tethys Bioscience, Inc.

  Diagnostic   Preferred Stock Warrants   Series E     617,683        147        117   
         

 

 

   

 

 

 

Total Warrants Diagnostic (0.07%)*

        391        435   
         

 

 

   

 

 

 

Labcyte, Inc.

  Biotechnology Tools   Preferred Stock Warrants   Series C     1,127,624        323        254   

NuGEN Technologies, Inc.

  Biotechnology Tools   Preferred Stock Warrants   Series B     204,545        45        202   
    Preferred Stock Warrants   Series C     30,114        33        11   
       

 

 

   

 

 

   

 

 

 

Total NuGEN Technologies, Inc.

          234,659        78        213   
         

 

 

   

 

 

 

Total Warrants Biotechnology Tools (0.08%)*

        401        467   
         

 

 

   

 

 

 

Entrigue Surgical, Inc.

  Surgical Devices   Preferred Stock Warrants   Series B     62,500        87        —     

Transmedics, Inc.

  Surgical Devices   Preferred Stock Warrants   Series B     40,436        225        —     
    Preferred Stock Warrants   Series D     175,000        100        227   
       

 

 

   

 

 

   

 

 

 

Total Transmedics, Inc.

          215,436        325        227   

Gynesonics, Inc.

  Surgical Devices   Preferred Stock Warrants   Series C     1,756,444        412        343   
         

 

 

   

 

 

 

Total Warrants Surgical Devices (0.09%)*

        824        570   
         

 

 

   

 

 

 

Everyday Health, Inc. (pka Waterfront Media, Inc.)

  Media/Content/ Info   Preferred Stock Warrants   Series C     110,018        60        76   

Glam Media, Inc.

  Media/Content/ Info   Preferred Stock Warrants   Series D     407,457        482        —     

Zoom Media Group, Inc.

  Media/Content/ Info   Preferred Stock Warrants   n/a     1,204        348        337   
         

 

 

   

 

 

 

Total Warrants Media/Content/Info (0.07%)*

        890        413   
         

 

 

   

 

 

 

 

See notes to consolidated financial statements.

 

21


Table of Contents

HERCULES TECHNOLOGY GROWTH CAPITAL, INC.

CONSOLIDATED SCHEDULE OF INVESTMENTS—(Continued)

March 31, 2013

(unaudited)

(dollars in thousands)

 

Portfolio Company

 

Sub-Industry

 

Type of Investment (1)

 

Series

  Shares     Cost (2)