UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

FORM 10-Q

 

(Mark One)

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

For The Quarterly Period Ended June 30, 2019

OR

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

Commission File Number: 814-00702

 

HERCULES CAPITAL, INC.

(Exact Name of Registrant as Specified in its Charter)

 

 

Maryland

 

74-3113410

(State or Jurisdiction of

Incorporation or Organization)

 

(IRS Employer

Identification Number)

 

400 Hamilton Ave., Suite 310

Palo Alto, California

(Address of Principal Executive Offices)

 

94301

(Zip Code)

 

(650) 289-3060

(Registrant’s Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Shares, par value $0.001 per share

HTGC

New York Stock Exchange

5.25% Notes due 2025

HCXZ

New York Stock Exchange

6.25% Notes due 2033

HCXY

New York Stock Exchange

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      No  

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted 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 such files).    Yes      No  

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

Large accelerated filer

 

  

Accelerated filer

 

 

 

 

 

Non-accelerated filer

 

  

Smaller reporting company

 

 

Emerging growth company

 

 

 

 

 

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with a new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

 

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

On July 29, 2019, there were 104,570,273 shares outstanding of the Registrant’s common stock, $0.001 par value.

 

 


 

HERCULES 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 June 30, 2019 and December 31, 2018 (unaudited)

  

3

 

 

 

Consolidated Statement of Operations for the three and six months ended June 30, 2019 and 2018 (unaudited)

  

5

 

 

 

Consolidated Statement of Changes in Net Assets for the three and six months ended June 30, 2019 and 2018 (unaudited)

  

6

 

 

 

Consolidated Statement of Cash Flows for the six months ended June 30, 2019 and 2018 (unaudited)

  

8

 

 

 

Consolidated Schedule of Investments as of June 30, 2019 (unaudited)

  

10

 

 

 

Consolidated Schedule of Investments as of December 31, 2018 (unaudited)

  

21

 

 

 

Notes to Consolidated Financial Statements (unaudited)

  

37

Item 2.

 

 

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

  

74

Item 3.

 

 

Quantitative and Qualitative Disclosures About Market Risk

  

94

Item 4.

 

 

Controls and Procedures

  

95

 

PART II. OTHER INFORMATION

  

96

 

Item 1.

 

Legal Proceedings

  

96

Item 1A.

 

 

Risk Factors

 

96

Item 2.

 

 

Unregistered Sales of Equity Securities and Use of Proceeds

  

98

Item 3.

 

 Defaults Upon Senior Securities

  

98

Item 4.

 

 

Mine Safety Disclosures

  

98

Item 5.

 

 

Other Information

  

98

Item 6.

 

 

Exhibits and Financial Statement Schedules

  

99

 

SIGNATURES

  

102

 

 

 

 

2


 

PART I: FINANCIAL INFORMATION

In this Quarterly Report, the “Company,” “Hercules,” “we,” “us” and “our” refer to Hercules Capital, Inc. and its wholly owned subsidiaries and its affiliated securitization trusts on or after February 25, 2016 and “Hercules Technology Growth Capital, Inc.” and its wholly owned subsidiaries and its affiliated securitization trusts prior to February 25, 2016, unless the context otherwise requires.

 

ITEM 1.

CONSOLIDATED FINANCIAL STATEMENTS

HERCULES CAPITAL, INC.

CONSOLIDATED STATEMENT OF ASSETS AND LIABILITIES

(unaudited)

(in thousands, except per share data)

 

 

 

June 30, 2019

 

 

December 31, 2018

 

Assets

 

 

 

 

 

 

 

 

Investments:

 

 

 

 

 

 

 

 

Non-control/Non-affiliate investments (cost of $2,162,377 and $1,830,725, respectively)

 

$

2,174,691

 

 

$

1,801,258

 

Control investments (cost of $65,143 and $64,799, respectively)

 

 

55,894

 

 

 

57,619

 

Affiliate investments (cost of $88,142 and $85,000, respectively)

 

 

21,414

 

 

 

21,496

 

Total investments in securities, at value (cost of $2,315,662 and $1,980,524, respectively)

 

 

2,251,999

 

 

 

1,880,373

 

Cash and cash equivalents

 

 

13,261

 

 

 

34,212

 

Restricted cash

 

 

15,339

 

 

 

11,645

 

Interest receivable

 

 

18,206

 

 

 

16,959

 

Right of use asset (1)

 

 

8,493

 

 

 

 

Other assets

 

 

4,269

 

 

 

2,002

 

Total assets

 

$

2,311,567

 

 

$

1,945,191

 

 

 

 

 

 

 

 

 

 

Liabilities

 

 

 

 

 

 

 

 

Accounts payable and accrued liabilities

 

$

27,274

 

 

$

25,961

 

Operating lease liability (1)

 

 

8,530

 

 

 

 

SBA Debentures, net (principal of $149,000 and $149,000, respectively)

 

 

147,910

 

 

 

147,655

 

2022 Notes, net (principal of $150,000 and $150,000, respectively) (2)

 

 

148,252

 

 

 

147,990

 

2024 Notes, net (principal of $0 and $83,510, respectively) (2)

 

 

 

 

 

81,852

 

2025 Notes, net (principal of $75,000 and $75,000, respectively) (2)

 

 

72,780

 

 

 

72,590

 

2033 Notes, net (principal of $40,000 and $40,000, respectively) (2)

 

 

38,447

 

 

 

38,427

 

2027 Asset-Backed Notes, net (principal of $200,000 and $200,000, respectively) (2)

 

 

197,171

 

 

 

197,265

 

2028 Asset-Backed Notes, net (principal of $250,000 and $0, respectively) (2)

 

 

247,266

 

 

 

 

2022 Convertible Notes, net (principal of $230,000 and $230,000, respectively) (2)

 

 

225,832

 

 

 

225,051

 

Credit Facilities

 

 

93,421

 

 

 

52,956

 

Total liabilities

 

$

1,206,883

 

 

$

989,747

 

 

 

 

 

 

 

 

 

 

Net assets consist of:

 

 

 

 

 

 

 

 

Common stock, par value

 

 

104

 

 

 

96

 

Capital in excess of par value

 

 

1,149,774

 

 

 

1,052,269

 

Total distributable earnings (loss) (3)

 

 

(45,194

)

 

 

(92,859

)

Treasury Stock, at cost, no shares as of June 30, 2019 and 376,466 shares as of December 31, 2018

 

 

 

 

 

(4,062

)

Total net assets

 

$

1,104,684

 

 

$

955,444

 

Total liabilities and net assets

 

$

2,311,567

 

 

$

1,945,191

 

 

 

 

 

 

 

 

 

 

Shares of common stock outstanding ($0.001 par value and 200,000,000 authorized)

 

 

104,282

 

 

 

96,501

 

Net asset value per share

 

$

10.59

 

 

$

9.90

 

 

(1)

See “Note 2 – Summary of Significant Accounting Policies” for a description of Right of use asset and Operating lease liability.

(2)

The Company’s SBA debentures, 2022 Notes, 2024 Notes, 2025 Notes, 2033 Notes, 2027 Asset-Backed Notes, 2028 Asset-Backed Notes, and 2022 Convertible Notes, as each term is defined herein, are presented net of the associated debt issuance costs for each instrument. See “Note 4 – Borrowings”.

(3)

Certain prior year numbers have been adjusted to conform with the SEC final rules on disclosure updates and simplification effective November 5, 2018. See Note 2.

 

See notes to consolidated financial statements

3


 

The following table presents the assets and liabilities of our consolidated securitization trusts for the 2027 Asset-Backed Notes and the 2028 Asset-Backed Notes (see Note 4), which are variable interest entities, or VIEs. The assets of our securitization VIEs can only be used to settle obligations of our consolidated securitization VIEs, these liabilities are only the obligations of our consolidated securitization VIEs, and the creditors (or beneficial interest holders) do not have recourse to our general credit. These assets and liabilities are included in the Consolidated Statement of Assets and Liabilities above.

 

(Dollars in thousands)

 

June 30, 2019

 

 

December 31, 2018

 

Assets

 

 

 

 

 

 

 

 

Restricted Cash

 

$

15,339

 

 

$

11,645

 

2027 Asset-Backed Notes, investments in securities, at value (cost of $298,584 and $279,373, respectively)

 

 

293,149

 

 

 

277,781

 

2028 Asset-Backed Notes, investments in securities, at value (cost of $363,734 and $0, respectively)

 

 

365,745

 

 

 

 

Total assets

 

$

674,233

 

 

$

289,426

 

 

 

 

 

 

 

 

 

 

Liabilities

 

 

 

 

 

 

 

 

2027 Asset-Backed Notes, net (principal of $200,000 and $200,000, respectively) (1)

 

$

197,171

 

 

$

197,265

 

2028 Asset-Backed Notes, net (principal of $250,000 and $0, respectively) (1)

 

 

247,266

 

 

 

 

Total liabilities

 

$

444,437

 

 

$

197,265

 

 

(1)

The Company’s 2027 Asset-Backed Notes and the 2028 Asset-Backed Notes are presented net of the associated debt issuance costs. See “Note 4 – Borrowings”.

See notes to consolidated financial statements

4


 

HERCULES CAPITAL, INC.

CONSOLIDATED STATEMENT OF OPERATIONS

(unaudited)

(in thousands, except per share data)

 

 

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

 

 

2019

 

 

2018

 

 

2019

 

 

2018

 

Investment income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-control/Non-affiliate investments

 

$

59,932

 

 

$

44,535

 

 

$

113,872

 

 

$

86,369

 

Control investments

 

 

1,040

 

 

 

841

 

 

 

2,064

 

 

 

1,427

 

Affiliate investments

 

 

738

 

 

 

500

 

 

 

1,247

 

 

 

1,061

 

Total interest income

 

 

61,710

 

 

 

45,876

 

 

 

117,183

 

 

 

88,857

 

Fee income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commitment, facility and loan fee income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-control/Non-affiliate investments

 

 

5,028

 

 

 

1,930

 

 

 

7,478

 

 

 

4,370

 

Control investments

 

 

4

 

 

 

 

 

 

8

 

 

 

 

Affiliate investments

 

 

72

 

 

 

84

 

 

 

160

 

 

 

192

 

Total commitment, facility and loan fee income

 

 

5,104

 

 

 

2,014

 

 

 

7,646

 

 

 

4,562

 

One-time fee income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-control/Non-affiliate investments

 

 

2,450

 

 

 

1,672

 

 

 

3,230

 

 

 

4,843

 

Total one-time fee income

 

 

2,450

 

 

 

1,672

 

 

 

3,230

 

 

 

4,843

 

Total fee income

 

 

7,554

 

 

 

3,686

 

 

 

10,876

 

 

 

9,405

 

Total investment income

 

 

69,264

 

 

 

49,562

 

 

 

128,059

 

 

 

98,262

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest

 

 

13,515

 

 

 

9,878

 

 

 

26,070

 

 

 

19,264

 

Loan fees

 

 

1,646

 

 

 

3,362

 

 

 

4,655

 

 

 

4,537

 

General and administrative

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Legal expenses

 

 

1,963

 

 

 

637

 

 

 

2,626

 

 

 

1,212

 

Other expenses

 

 

3,832

 

 

 

3,037

 

 

 

7,322

 

 

 

6,471

 

Total general and administrative

 

 

5,795

 

 

 

3,674

 

 

 

9,948

 

 

 

7,683

 

Employee compensation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Compensation and benefits

 

 

9,190

 

 

 

7,017

 

 

 

15,813

 

 

 

12,775

 

Stock-based compensation

 

 

3,851

 

 

 

2,857

 

 

 

7,273

 

 

 

5,166

 

Total employee compensation

 

 

13,041

 

 

 

9,874

 

 

 

23,086

 

 

 

17,941

 

Total operating expenses

 

 

33,997

 

 

 

26,788

 

 

 

63,759

 

 

 

49,425

 

Net investment income

 

 

35,267

 

 

 

22,774

 

 

 

64,300

 

 

 

48,837

 

Net realized gain (loss) on investments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-control/Non-affiliate investments

 

 

4,271

 

 

 

(3,953

)

 

 

8,826

 

 

 

(7,465

)

Control investments

 

 

 

 

 

(2,900

)

 

 

 

 

 

(4,308

)

Affiliate investments

 

 

 

 

 

(2,058

)

 

 

 

 

 

(2,058

)

Total net realized gain (loss) on investments

 

 

4,271

 

 

 

(8,911

)

 

 

8,826

 

 

 

(13,831

)

Net change in unrealized appreciation (depreciation) on investments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-control/Non-affiliate investments

 

 

9,794

 

 

 

32,700

 

 

 

41,884

 

 

 

18,360

 

Control investments

 

 

808

 

 

 

3,957

 

 

 

(2,068

)

 

 

3,337

 

Affiliate investments

 

 

(2,009

)

 

 

1,540

 

 

 

(3,226

)

 

 

1,303

 

Total net unrealized appreciation (depreciation) on investments

 

 

8,593

 

 

 

38,197

 

 

 

36,590

 

 

 

23,000

 

Total net realized and unrealized gain (loss)

 

 

12,864

 

 

 

29,286

 

 

 

45,416

 

 

 

9,169

 

Net increase (decrease) in net assets resulting from operations

 

$

48,131

 

 

$

52,060

 

 

$

109,716

 

 

$

58,006

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

Basic

 

$

0.36

 

 

$

0.26

 

 

$

0.66

 

 

$

0.57

 

Change in net assets resulting from operations per common share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.49

 

 

$

0.59

 

 

$

1.13

 

 

$

0.67

 

Diluted

 

$

0.49

 

 

$

0.59

 

 

$

1.12

 

 

$

0.67

 

Weighted average shares outstanding

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

98,223

 

 

 

87,125

 

 

 

97,226

 

 

 

85,868

 

Diluted

 

 

98,737

 

 

 

87,199

 

 

 

97,630

 

 

 

85,939

 

Distributions paid per common share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.33

 

 

$

0.31

 

 

$

0.64

 

 

$

0.62

 

 

See notes to consolidated financial statements

5


 

HERCULES CAPITAL, INC.

CONSOLIDATED STATEMENT OF CHANGES IN NET ASSETS

(unaudited)

(dollars and shares in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Capital in

 

 

Distributable

 

 

 

 

 

 

 

 

 

 

Common Stock

 

 

excess

 

 

Earnings

 

 

Treasury

 

 

Net

 

For the Three Months Ended June 30, 2019

Shares

 

 

Par Value

 

 

of par value

 

 

(loss)(2)

 

 

Stock

 

 

Assets

 

Balance at March 31, 2019

 

96,543

 

 

$

96

 

 

$

1,051,427

 

 

$

(61,174

)

 

$

 

 

$

990,349

 

Net increase (decrease) in net assets resulting from operations

 

 

 

 

 

 

 

 

 

 

48,131

 

 

 

 

 

 

48,131

 

Public offering, net of offering expenses

 

7,700

 

 

 

8

 

 

 

95,436

 

 

 

 

 

 

 

 

 

95,444

 

Issuance of common stock due to stock option exercises

 

1

 

 

 

 

 

 

7

 

 

 

 

 

 

 

 

 

7

 

Retired shares from net issuance

 

(1

)

 

 

 

 

 

(7

)

 

 

 

 

 

 

 

 

(7

)

Issuance of common stock under restricted stock plan

 

10

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Retirement of common stock under repurchase plan

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Retired shares for restricted stock vesting

 

(13

)

 

 

 

 

 

(196

)

 

 

 

 

 

 

 

 

(196

)

Distributions reinvested in common stock

 

42

 

 

 

 

 

 

557

 

 

 

 

 

 

 

 

 

557

 

Distributions

 

 

 

 

 

 

 

 

 

 

(32,151

)

 

 

 

 

 

(32,151

)

Stock-based compensation (1)

 

 

 

 

 

 

 

2,550

 

 

 

 

 

 

 

 

 

2,550

 

Balance at June 30, 2019

 

104,282

 

 

$

104

 

 

$

1,149,774

 

 

$

(45,194

)

 

$

 

 

$

1,104,684

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

For the Six Months Ended June 30, 2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at December 31, 2018

 

96,501

 

 

$

96

 

 

$

1,052,269

 

 

$

(92,859

)

 

$

(4,062

)

 

$

955,444

 

Net increase (decrease) in net assets resulting from operations

 

 

 

 

 

 

 

 

 

 

109,716

 

 

 

 

 

 

109,716

 

Public offering, net of offering expenses

 

7,700

 

 

 

8

 

 

 

95,415

 

 

 

 

 

 

 

 

 

95,423

 

Issuance of common stock due to stock option exercises

 

14

 

 

 

 

 

 

161

 

 

 

 

 

 

 

 

 

161

 

Retired shares from net issuance

 

(12

)

 

 

 

 

 

(166

)

 

 

 

 

 

 

 

 

(166

)

Issuance of common stock under restricted stock plan

 

58

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Retirement of common stock under repurchase plan

 

 

 

 

 

 

 

(4,062

)

 

 

 

 

 

4,062

 

 

 

 

Retired shares for restricted stock vesting

 

(68

)

 

 

 

 

 

(887

)

 

 

 

 

 

 

 

 

(887

)

Distributions reinvested in common stock

 

89

 

 

 

 

 

 

1,189

 

 

 

 

 

 

 

 

 

1,189

 

Distributions

 

 

 

 

 

 

 

 

 

 

(62,051

)

 

 

 

 

 

(62,051

)

Stock-based compensation (1)

 

 

 

 

 

 

 

5,855

 

 

 

 

 

 

 

 

 

5,855

 

Balance at June 30, 2019

 

104,282

 

 

$

104

 

 

$

1,149,774

 

 

$

(45,194

)

 

$

 

 

$

1,104,684

 

 

(1)

Stock-based compensation includes $24 and $31 of restricted stock and option expense related to director compensation for the three and six months ended June 30, 2019, respectively.

(2)

Certain prior year numbers have been adjusted to conform with the SEC final rules on disclosure updates and simplification effective November 5, 2018. See Note 2.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

See notes to consolidated financial statements

6


 

 

 

HERCULES CAPITAL, INC.

CONSOLIDATED STATEMENT OF CHANGES IN NET ASSETS

(unaudited)

(dollars and shares in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Capital in

 

 

Distributable

 

 

 

 

 

 

 

Common Stock

 

 

excess

 

 

Earnings

 

 

Net

 

For the Three Months Ended June 30, 2018

 

Shares

 

 

Par Value

 

 

of par value

 

 

(loss)(2)

 

 

Assets

 

Balance at March 31, 2018

 

 

85,239

 

 

$

85

 

 

$

916,738

 

 

$

(88,092

)

 

$

828,731

 

Net increase (decrease) in net assets resulting from operations

 

 

 

 

 

 

 

 

 

 

 

52,060

 

 

 

52,060

 

Public offering, net of offering expenses

 

 

9,008

 

 

 

9

 

 

 

106,665

 

 

 

 

 

 

106,674

 

Issuance of common stock due to stock option exercises

 

 

 

 

 

 

 

 

1

 

 

 

 

 

 

1

 

Retired shares from net issuance

 

 

 

 

 

 

 

 

(1

)

 

 

 

 

 

(1

)

Issuance of common stock under restricted stock plan

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Retired shares for restricted stock vesting

 

 

(21

)

 

 

 

 

 

(242

)

 

 

 

 

 

(242

)

Distributions reinvested in common stock

 

 

34

 

 

 

 

 

 

428

 

 

 

 

 

 

428

 

Distributions

 

 

 

 

 

 

 

 

 

 

 

(26,678

)

 

 

(26,678

)

Stock-based compensation (1)

 

 

 

 

 

 

 

 

2,724

 

 

 

 

 

 

2,724

 

Balance at June 30, 2018

 

 

94,260

 

 

$

94

 

 

$

1,026,313

 

 

$

(62,710

)

 

$

963,697

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

For the Six Months Ended June 30, 2018

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at December 31, 2017

 

 

84,424

 

 

$

85

 

 

$

908,501

 

 

$

(67,619

)

 

$

840,967

 

Net increase (decrease) in net assets resulting from operations

 

 

 

 

 

 

 

 

 

 

 

58,006

 

 

 

58,006

 

Public offering, net of offering expenses

 

 

9,486

 

 

 

9

 

 

 

112,617

 

 

 

 

 

 

112,626

 

Issuance of common stock due to stock option exercises

 

 

38

 

 

 

 

 

 

433

 

 

 

 

 

 

433

 

Retired shares from net issuance

 

 

(36

)

 

 

 

 

 

(447

)

 

 

 

 

 

(447

)

Issuance of common stock under restricted stock plan

 

 

336

 

 

 

 

 

 

 

 

 

 

 

 

 

Retired shares for restricted stock vesting

 

 

(57

)

 

 

 

 

 

(688

)

 

 

 

 

 

(688

)

Distributions reinvested in common stock

 

 

69

 

 

 

 

 

 

854

 

 

 

 

 

 

854

 

Distributions

 

 

 

 

 

 

 

 

 

 

 

(53,097

)

 

 

(53,097

)

Stock-based compensation (1)

 

 

 

 

 

 

 

 

5,043

 

 

 

 

 

 

5,043

 

Balance at June 30, 2018

 

 

94,260

 

 

$

94

 

 

$

1,026,313

 

 

$

(62,710

)

 

$

963,697

 

 

(1)

Stock-based compensation includes $10 and $20 of restricted stock and option expense related to director compensation for the three and six months ended June 30, 2018, respectively.

(2)

Certain prior year numbers have been adjusted to conform with the SEC final rules on disclosure updates and simplification effective November 5, 2018. See Note 2.

 

 

 

See notes to consolidated financial statements

7


 

HERCULES CAPITAL, INC.

CONSOLIDATED STATEMENT OF CASH FLOWS

(unaudited)

(dollars in thousands)

 

 

For the Six Months Ended June 30,

 

 

2019

 

 

2018

 

Cash flows from operating activities:

 

 

 

 

 

 

 

Net increase (decrease) in net assets resulting from operations

$

109,716

 

 

$

58,006

 

Adjustments to reconcile net increase in net assets resulting from

operations to net cash provided by (used in) operating activities:

 

 

 

 

 

 

 

Purchase of investments

 

(607,847

)

 

 

(563,744

)

Principal and fee payments received on investments

 

267,654

 

 

 

414,347

 

Proceeds from the sale of investments

 

21,264

 

 

 

9,768

 

Net unrealized depreciation (appreciation) on investments

 

(36,590

)

 

 

(23,000

)

Net realized loss (gain) on investments

 

(8,826

)

 

 

13,831

 

Accretion of paid-in-kind principal

 

(4,310

)

 

 

(4,696

)

Accretion of loan discounts

 

(1,510

)

 

 

(1,562

)

Accretion of loan discount on convertible notes

 

336

 

 

 

336

 

Accretion of loan exit fees

 

(11,253

)

 

 

(8,923

)

Change in deferred loan origination revenue

 

10,787

 

 

 

3,415

 

Unearned fees related to unfunded commitments

 

1,898

 

 

 

1,616

 

Amortization of debt fees and issuance costs

 

3,956

 

 

 

3,999

 

Depreciation

 

101

 

 

 

94

 

Stock-based compensation and amortization of restricted stock grants (1)

 

5,855

 

 

 

5,043

 

Change in operating assets and liabilities:

 

 

 

 

 

 

 

Interest and fees receivable

 

(1,247

)

 

 

(2,146

)

Prepaid expenses and other assets

 

(11,453

)

 

 

518

 

Accounts payable

 

(191

)

 

 

244

 

Accrued liabilities

 

10,136

 

 

 

(1,016

)

Net cash provided by (used in) operating activities

 

(251,524

)

 

 

(93,870

)

 

 

 

 

 

 

 

 

Cash flows from investing activities:

 

 

 

 

 

 

 

Purchases of capital equipment

 

(241

)

 

 

(116

)

Net cash provided by (used in) investing activities

 

(241

)

 

 

(116

)

 

 

 

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

 

 

 

Issuance of common stock, net

 

95,379

 

 

 

112,626

 

Retirement of employee shares

 

(850

)

 

 

(701

)

Distributions paid

 

(60,862

)

 

 

(52,243

)

Issuance of 2028 Asset-Backed Notes

 

250,000

 

 

 

 

Repayments of 2024 Notes

 

(83,510

)

 

 

(100,000

)

Repayments of 2021 Asset-Backed Notes

 

 

 

 

(18,065

)

Borrowings of credit facilities

 

405,192

 

 

 

150,700

 

Repayments of credit facilities

 

(364,727

)

 

 

(92,377

)

Cash paid for debt issuance costs

 

(3,117

)

 

 

(519

)

Fees paid for credit facilities and debentures

 

(2,997

)

 

 

(83

)

Net cash provided by (used in) financing activities

 

234,508

 

 

 

74,338

 

Net increase (decrease) in cash, cash equivalents and restricted cash

 

(17,257

)

 

 

(19,648

)

Cash, cash equivalents and restricted cash at beginning of period

 

45,857

 

 

 

94,995

 

Cash, cash equivalents and restricted cash at end of period

$

28,600

 

 

$

75,347

 

 

 

 

 

 

 

 

 

Supplemental non-cash investing and financing activities:

 

 

 

 

 

 

 

Distributions reinvested

 

1,189

 

 

 

854

 

 

(1)

Stock-based compensation includes $31 and $20 of restricted stock and option expense related to director compensation for the six months ended June 30, 2019 and 2018, respectively.


See notes to consolidated financial statements

8


 

The following table presents a reconciliation of cash, cash equivalents and restricted cash reported within the Consolidated Statement of Assets and Liabilities that sum to the total of the same such amounts in the Consolidated Statement of Cash Flows:

 

 

For the Six Months Ended June 30,

 

(Dollars in thousands)

2019

 

 

2018

 

Cash and cash equivalents

$

13,261

 

 

$

59,461

 

Restricted cash

 

15,339

 

 

 

15,886

 

Total cash, cash equivalents and restricted cash presented in the Consolidated Statements of Cash Flows

$

28,600

 

 

$

75,347

 

See “Note 2 – Summary of Significant Accounting Policies” for a description of restricted cash and cash equivalents.

 

See notes to consolidated financial statements

9


HERCULES CAPITAL, INC.

CONSOLIDATED SCHEDULE OF INVESTMENTS

June 30, 2019

(unaudited)

(dollars in thousands)

 

 

Portfolio Company

Sub-Industry

Type of

Investment (1)

Maturity Date

Interest Rate and Floor (2)

Principal

Amount

 

Cost (3)

 

Value (4)

 

Debt Investments

 

 

 

 

 

 

 

 

 

 

 

 

 

Biotechnology Tools

 

 

 

 

 

 

 

 

 

 

 

 

 

Under 1 Year Maturity

 

 

 

 

 

 

 

 

 

 

 

 

 

Exicure, Inc. (11)

Biotechnology Tools

Senior Secured

March 2020

Interest rate PRIME + 6.45% or Floor rate of 9.95%, 5.52% Exit Fee

$

4,999

 

$

5,199

 

$

5,199

 

Subtotal: Under 1 Year Maturity

 

 

 

 

 

 

 

 

5,199

 

 

5,199

 

Subtotal: Biotechnology Tools (0.47%)*

 

 

 

 

 

5,199

 

 

5,199

 

Consumer & Business Products

 

 

 

 

 

 

 

 

 

 

 

 

 

1-5 Years Maturity

 

 

 

 

 

 

 

 

 

 

 

 

 

WHOOP, INC. (12)

Consumer & Business Products

Senior Secured

July 2021

Interest rate PRIME + 3.75% or Floor rate of 8.50%, 6.95% Exit Fee

$

6,000

 

 

6,142

 

 

6,153

 

Subtotal: 1-5 Years Maturity

 

 

 

 

 

 

 

 

6,142

 

 

6,153

 

Subtotal: Consumer & Business Products (0.56%)*

 

 

 

 

 

6,142

 

 

6,153

 

Diversified Financial Services

 

 

 

 

 

 

 

 

 

 

 

 

 

1-5 Years Maturity

 

 

 

 

 

 

 

 

 

 

 

 

 

Gibraltar Business Capital, LLC (7)

Diversified Financial Services

Unsecured

March 2023

Interest rate FIXED 14.50%

$

15,000

 

 

14,754

 

 

14,754

 

Pico Quantitative Trading LLC (18)

Diversified Financial Services

Senior Secured

June 2024

Interest rate PRIME + 5.30% or Floor rate of 10.80%

$

30,000

 

 

29,518

 

 

29,518

 

Subtotal: 1-5 Years Maturity

 

 

 

 

 

 

 

 

44,272

 

 

44,272

 

Subtotal: Diversified Financial Services (4.01%)*

 

 

 

 

 

44,272

 

 

44,272

 

Drug Delivery

 

 

 

 

 

 

 

 

 

 

 

 

 

1-5 Years Maturity

 

 

 

 

 

 

 

 

 

 

 

 

 

Antares Pharma Inc. (10)(11)(15)

Drug Delivery

Senior Secured

July 2022

Interest rate PRIME + 4.50% or Floor rate of 9.50%, 4.14% Exit Fee

$

40,000

 

 

40,401

 

 

40,393

 

Subtotal: 1-5 Years Maturity

 

 

 

 

 

 

 

 

40,401

 

 

40,393

 

Subtotal: Drug Delivery (3.66%)*

 

 

 

 

 

40,401

 

 

40,393

 

Drug Discovery & Development

 

 

 

 

 

 

 

 

 

 

 

 

 

Under 1 Year Maturity

 

 

 

 

 

 

 

 

 

 

 

 

 

Brickell Biotech, Inc. (12)

Drug Discovery & Development

Senior Secured

September 2019

Interest rate PRIME + 5.70% or Floor rate of 9.20%, 7.82% Exit Fee

$

3,199

 

 

3,763

 

 

2,802

 

Subtotal: Under 1 Year Maturity

 

 

 

 

 

3,763

 

 

2,802

 

1-5 Years Maturity

 

 

 

 

 

 

 

 

 

 

 

 

 

Acacia Pharma Inc. (5)(10)(11)

Drug Discovery & Development

Senior Secured

January 2022

Interest rate PRIME + 4.50% or Floor rate of 9.25%, 3.95% Exit Fee

$

10,000

 

 

9,988

 

 

10,023

 

Aveo Pharmaceuticals, Inc. (11)

Drug Discovery & Development

Senior Secured

July 2021

Interest rate PRIME + 4.70% or Floor rate of 9.45%, 5.40% Exit Fee

$

10,000

 

 

10,218

 

 

10,246

 

 

Drug Discovery & Development

Senior Secured

July 2021

Interest rate PRIME + 4.70% or Floor rate of 9.45%, 3.00% Exit Fee

$

10,000

 

 

10,361

 

 

10,421

 

        Total Aveo Pharmaceuticals, Inc.

$

20,000

 

 

20,579

 

 

20,667

 

Axovant Gene Therapies Ltd. (p.k.a. Axovant Sciences Ltd.) (5)(10)(11)

Drug Discovery & Development

Senior Secured

March 2021

Interest rate PRIME + 6.80% or Floor rate of 10.55%

$

40,248

 

 

39,803

 

 

39,873

 

BridgeBio Pharma LLC (13)(16)

Drug Discovery & Development

Senior Secured

July 2022

Interest rate PRIME + 3.85% or Floor rate of 8.85%, 6.35% Exit Fee

$

35,000

 

 

35,392

 

 

36,163

 

 

Drug Discovery & Development

Senior Secured

July 2022

Interest rate PRIME + 2.85% or Floor rate of 8.60%, 5.75% Exit Fee

$

20,000

 

 

20,098

 

 

20,433

 

 

Drug Discovery & Development

Senior Secured

July 2022

Interest rate PRIME + 3.10% or Floor rate of 9.10%, 5.75% Exit Fee

$

20,000

 

 

19,857

 

 

20,433

 

Total BridgeBio Pharma LLC

 

 

 

 

$

75,000

 

 

75,347

 

 

77,029

 

Chemocentryx, Inc. (10)(15)

Drug Discovery & Development

Senior Secured

December 2022

Interest rate PRIME + 3.30% or Floor rate of 8.05%, 6.25% Exit Fee

$

20,000

 

 

20,123

 

 

20,671

 

Constellation Pharmaceuticals, Inc. (10)(12)(17)

Drug Discovery & Development

Senior Secured

April 2023

Interest rate PRIME + 2.55% or Floor rate of 8.55%, 6.35% Exit Fee

$

20,000

 

 

19,946

 

 

19,946

 

Dermavant Sciences Ltd. (5)(10)(13)

Drug Discovery & Development

Senior Secured

June 2022

Interest rate PRIME + 4.45% or Floor rate of 9.95%, 6.95% Exit Fee

$

20,000

 

 

19,676

 

 

19,676

 

Genocea Biosciences, Inc. (11)

Drug Discovery & Development

Senior Secured

May 2021

Interest rate PRIME + 2.75% or Floor rate of 7.75%, 10.12% Exit Fee

$

13,465

 

 

13,844

 

 

13,846

 

Mesoblast (5)(10)(11)

Drug Discovery & Development

Senior Secured

March 2022

Interest rate PRIME + 4.95% or Floor rate of 9.45%, 6.95% Exit Fee

$

50,000

 

 

50,784

 

 

50,889

 

Metuchen Pharmaceuticals LLC (14)

Drug Discovery & Development

Senior Secured

October 2020

Interest rate PRIME + 7.25% or Floor rate of 10.75%, PIK Interest 1.35%, 2.25% Exit Fee

$

15,769

 

 

16,600

 

 

16,596

 

Motif BioSciences Inc. (5)(10)(11)

Drug Discovery & Development

Senior Secured

September 2021

Interest rate PRIME + 5.50% or Floor rate of 10.00%, 2.15% Exit Fee

$

7,099

 

 

7,093

 

 

3,516

 

Myovant Sciences, Ltd. (5)(10)(11)

Drug Discovery & Development

Senior Secured

November 2021

Interest rate PRIME + 4.00% or Floor rate of 8.25%, 6.55% Exit Fee

$

40,000

 

 

40,875

 

 

40,966

 

Nabriva Therapeutics (5)(10)(11)

Drug Discovery & Development

Senior Secured

June 2023

Interest rate PRIME + 4.30% or Floor rate of 9.80%, 6.95% Exit Fee

$

25,000

 

 

25,028

 

 

25,148

 

Paratek Pharmaceuticals, Inc. (11)(15)(16)

Drug Discovery & Development

Senior Secured

September 2021

Interest rate PRIME + 2.75% or Floor rate of 8.50%, 4.50% Exit Fee

$

40,000

 

 

41,129

 

 

41,338

 

See notes to consolidated financial statements

10


HERCULES CAPITAL, INC.

CONSOLIDATED SCHEDULE OF INVESTMENTS

June 30, 2019

(unaudited)

(dollars in thousands)

 

 

Portfolio Company

Sub-Industry

Type of

Investment (1)

Maturity Date

Interest Rate and Floor (2)

Principal

Amount

 

Cost (3)

 

Value (4)

 

 

Drug Discovery & Development

Senior Secured

September 2021

Interest rate PRIME + 2.75% or Floor rate of 8.50%, 4.50% Exit Fee

$

10,000

 

$

10,310

 

$

10,350

 

 

Drug Discovery & Development

Senior Secured

September 2021

Interest rate PRIME + 2.75% or Floor rate of 8.50%, 2.25% Exit Fee

$

10,000

 

 

10,123

 

 

10,144

 

 

Drug Discovery & Development

Senior Secured

August 2022

Interest rate PRIME + 2.10% or Floor rate of 7.85%, 6.95% Exit Fee

$

10,000

 

 

10,127

 

 

10,130

 

         Total Paratek Pharmaceuticals, Inc.

$

70,000

 

 

71,689

 

 

71,962

 

Stealth Bio Therapeutics Corp. (5)(10)(11)

Drug Discovery & Development

Senior Secured

January 2021

Interest rate PRIME + 5.50% or Floor rate of 9.50%, 6.68% Exit Fee

$

17,220

 

 

17,901

 

 

17,957

 

TG Therapeutics, Inc. (10)(13)

Drug Discovery & Development

Senior Secured

March 2022

Interest rate PRIME + 5.50% or Floor rate of 10.25%, 3.25% Exit Fee

$

30,000

 

 

29,350

 

 

29,350

 

Tricida, Inc. (11)(15)(17)

Drug Discovery & Development

Senior Secured

April 2023

Interest rate PRIME + 2.35% or Floor rate of 8.35%, 14.10% Exit Fee

$

40,000

 

 

40,013

 

 

40,420

 

uniQure B.V. (5)(10)(11)

Drug Discovery & Development

Senior Secured

June 2023

Interest rate PRIME + 3.35% or Floor rate of 8.85%, 7.72% Exit Fee

$

35,000

 

 

35,822

 

 

36,048

 

Urovant Sciences, Ltd. (5)(10)(13)(17)

Drug Discovery & Development

Senior Secured

March 2023

Interest rate PRIME + 4.65% or Floor rate of 10.15%, 4.25% Exit Fee

$

15,000

 

 

14,833

 

 

14,833

 

Verastem, Inc. (11)

Drug Discovery & Development

Senior Secured

December 2022

Interest rate PRIME + 4.25% or Floor rate of 9.75%, 5.25% Exit Fee

$

5,000

 

 

4,980

 

 

5,025

 

 

Drug Discovery & Development

Senior Secured

December 2022

Interest rate PRIME + 4.25% or Floor rate of 9.75%, 5.25% Exit Fee

$

5,000

 

 

5,004

 

 

5,049

 

 

Drug Discovery & Development

Senior Secured

December 2022

Interest rate PRIME + 4.25% or Floor rate of 9.75%, 5.25% Exit Fee

$

5,000

 

 

4,998

 

 

5,037

 

 

Drug Discovery & Development

Senior Secured

December 2022

Interest rate PRIME + 4.25% or Floor rate of 9.75%, 5.25% Exit Fee

$

10,000

 

 

9,973

 

 

10,063

 

 

Drug Discovery & Development

Senior Secured

December 2022

Interest rate PRIME + 4.25% or Floor rate of 9.75%, 5.25% Exit Fee

$

10,000

 

 

9,935

 

 

10,025

 

Total Verastem, Inc.

 

 

 

 

$

35,000

 

 

34,890

 

 

35,199

 

X4 Pharmaceuticals, Inc. (11)(17)

Drug Discovery & Development

Senior Secured

July 2023

Interest rate PRIME + 2.75% or Floor rate of 8.75%, 7.98% Exit Fee

$

20,000

 

 

19,871

 

 

19,880

 

Subtotal: 1-5 Years Maturity

 

 

 

 

 

 

 

 

624,055

 

 

624,495

 

Subtotal: Drug Discovery & Development (56.79%)*

 

 

 

 

 

627,818

 

 

627,297

 

Electronics & Computer Hardware

 

 

 

 

 

 

 

1-5 Years Maturity

 

 

 

 

 

 

 

 

 

 

 

 

 

908 DEVICES INC. (15)

Electronics & Computer Hardware

Senior Secured

June 2021

Interest rate PRIME + 4.00% or Floor rate of 8.25%, 4.25% Exit Fee

$

10,000

 

 

10,165

 

 

10,104

 

Glo AB (5)(10)(13)(14)

Electronics & Computer Hardware

Senior Secured

February 2021

Interest rate PRIME + 6.20% or Floor rate of 10.45%, PIK Interest 1.75%, 5.03% Exit Fee

$

10,574

 

 

10,779

 

 

7,589

 

Subtotal: 1-5 Years Maturity

 

 

 

 

 

 

 

 

20,944

 

 

17,693

 

Subtotal: Electronics & Computer Hardware (1.60%)*

 

 

 

 

 

20,944

 

 

17,693

 

Healthcare Services, Other

 

 

 

 

 

 

 

 

 

 

 

 

 

1-5 Years Maturity

 

 

 

 

 

 

 

 

 

 

 

 

 

Oak Street Health (11)(16)

Healthcare Services, Other

Senior Secured

June 2022

Interest rate PRIME + 5.00% or Floor rate of 9.75%, 5.95% Exit Fee

$

60,000

 

 

60,635

 

 

60,885

 

PH Group Holdings (13)

Healthcare Services, Other

Senior Secured

September 2020

Interest rate PRIME + 7.45% or Floor rate of 10.95%

$

20,000

 

 

19,939

 

 

19,966

 

 

Healthcare Services, Other

Senior Secured

September 2020

Interest rate PRIME + 7.45% or Floor rate of 10.95%

$

10,000

 

 

9,965

 

 

9,977

 

Total PH Group Holdings

 

 

 

 

$

30,000

 

 

29,904

 

 

29,943

 

The CM Group LLC (17)

Healthcare Services, Other

Senior Secured

June 2024

Interest rate 1-month LIBOR + 8.35% or Floor rate of 9.35%

$

9,500

 

 

9,324

 

 

9,324

 

Subtotal: 1-5 Years Maturity

 

 

 

 

 

 

 

 

99,863

 

 

100,152

 

Subtotal: Healthcare Services, Other (9.07%)*

 

 

 

 

 

99,863

 

 

100,152

 

Information Services

 

 

 

 

 

 

 

 

 

 

 

 

 

1-5 Years Maturity

 

 

 

 

 

 

 

 

 

 

 

 

 

MDX Medical, Inc. (14)(15)(19)

Information Services

Senior Secured

June 2021

Interest rate PRIME + 4.00% or Floor rate of 8.25%, PIK Interest 1.70%, 2.80% Exit Fee

$

15,420

 

 

15,314

 

 

15,355

 

Planet Labs, Inc.

Information Services

Senior Secured

June 2022

Interest rate PRIME + 5.50% or Floor rate of 11.00%, 3.00% Exit Fee

$

20,000

 

 

19,345

 

 

19,345

 

YIPIT, LLC (17)(18)

Information Services

Senior Secured

May 2024

Interest rate 1-month LIBOR + 5.55% or Floor rate of 5.55%

$

10,625

 

 

10,395

 

 

10,395

 

Subtotal: 1-5 Years Maturity

 

 

 

 

 

 

 

 

45,054

 

 

45,095

 

Subtotal: Information Services (4.08%)*

 

 

 

 

 

45,054

 

 

45,095

 

Internet Consumer & Business Services

 

 

 

 

 

 

 

Under 1 Year Maturity

 

 

 

 

 

 

 

 

 

 

 

 

 

LogicSource (12)

Internet Consumer & Business Services

Senior Secured

October 2019

Interest rate PRIME + 6.25% or Floor rate of 9.75%, 5.00% Exit Fee

$

1,277

 

 

1,697

 

 

1,697

 

Subtotal: Under 1 Year Maturity

 

 

 

 

 

1,697

 

 

1,697

 

See notes to consolidated financial statements

11


HERCULES CAPITAL, INC.

CONSOLIDATED SCHEDULE OF INVESTMENTS

June 30, 2019

(unaudited)

(dollars in thousands)

 

 

Portfolio Company

Sub-Industry

Type of

Investment (1)

Maturity Date

Interest Rate and Floor (2)

Principal

Amount

 

Cost (3)

 

Value (4)

 

1-5 Years Maturity

 

 

 

 

 

 

 

 

 

 

 

 

 

Adroll, Inc (14)(19)

Internet Consumer & Business Services

Senior Secured

June 2022

Interest rate PRIME + 3.85% or Floor rate of 9.35%, PIK Interest 2.95%, 3.50% Exit Fee

$

20,002

 

$

19,804

 

$

19,804

 

AppDirect, Inc. (11)(19)

Internet Consumer & Business Services

Senior Secured

January 2022

Interest rate PRIME + 5.70% or Floor rate of 9.95%, 3.45% Exit Fee

$

20,000

 

 

20,158

 

 

20,276

 

Arctic Wolf Networks, Inc. (13)(19)

Internet Consumer & Business Services

Senior Secured

April 2023

Interest rate 3-month LIBOR + 7.75% or Floor rate of 10.10%, 7.55% Exit Fee

$

30,000

 

 

29,825

 

 

29,825

 

Cloudpay, Inc. (5)(10)(11)

Internet Consumer & Business Services

Senior Secured

April 2022

Interest rate PRIME + 4.05% or Floor rate of 8.55%, 6.95% Exit Fee

$

11,000

 

 

11,156

 

 

11,250

 

Contentful, Inc. (5)(10)(11)(14)

Internet Consumer & Business Services

Senior Secured

July 2022

Interest rate PRIME + 2.95% or Floor rate of 7.95%, PIK Interest 1.25%, 3.55% Exit Fee

$

3,770

 

 

3,739

 

 

3,765

 

Convercent, Inc. (14)(15)

Internet Consumer & Business Services

Senior Secured

July 2022

Interest rate PRIME + 2.55% or Floor rate of 7.80%, PIK Interest 2.95%, 1.00% Exit Fee

$

10,112

 

 

10,031

 

 

10,095

 

EverFi, Inc. (11)(14)(16)

Internet Consumer & Business Services

Senior Secured

May 2022

Interest rate PRIME + 3.90% or Floor rate of 8.65%, PIK Interest 2.30%

$

61,439

 

 

61,402

 

 

62,167

 

Fastly, Inc. (11)(17)(19)

Internet Consumer & Business Services

Senior Secured

December 2021

Interest rate PRIME + 4.25%, 1.50% Exit Fee

$

6,667

 

 

6,593

 

 

6,593

 

First Insight, Inc. (15)

Internet Consumer & Business Services

Senior Secured

November 2021

Interest rate PRIME + 6.25% or Floor rate of 11.25%

$

10,000

 

 

9,852

 

 

9,884

 

Greenphire, Inc. (17)

Internet Consumer & Business Services

Senior Secured

January 2021

Interest rate 3-month LIBOR + 8.00% or Floor rate of 9.00%

$

2,078

 

 

2,078

 

 

2,092

 

 

Internet Consumer & Business Services

Senior Secured

January 2021

Interest rate PRIME + 3.75% or Floor rate of 7.00%

$

750

 

 

750

 

 

748

 

Total Greenphire, Inc.

 

 

 

 

$

2,828

 

 

2,828

 

 

2,840

 

Intent (p.k.a. Intent Media, Inc.) (12)

Internet Consumer & Business Services

Senior Secured

September 2021

Interest rate PRIME + 5.13% or Floor rate of 10.13%

$

15,200

 

 

15,093

 

 

15,074

 

Lendio, Inc. (11)(17)(19)

Internet Consumer & Business Services

Senior Secured

April 2023

Interest rate PRIME + 4.45% or Floor rate of 9.95%, 5.25% Exit Fee

$

5,000

 

 

4,929

 

 

4,929

 

Patron Technology (18)

Internet Consumer & Business Services

Senior Secured

June 2024

Interest rate 3-month LIBOR + 8.30% or Floor rate of 9.30%

$

32,500

 

 

31,535

 

 

31,535

 

Postmates, Inc. (17)(19)

Internet Consumer & Business Services

Senior Secured

September 2022

Interest rate PRIME + 3.85% or Floor rate of 8.85%, 8.05% Exit Fee

$

20,000

 

 

19,976

 

 

20,118

 

SeatGeek, Inc. (14)(17)

Internet Consumer & Business Services

Senior Secured

June 2023

Interest rate PRIME + 5.00% or Floor rate of 10.50%, PIK Interest 0.50%

$

15,000

 

 

14,521

 

 

14,521

 

Snagajob.com, Inc. (13)(14)

Internet Consumer & Business Services

Senior Secured

August 2020

Interest rate PRIME + 5.15% or Floor rate of 9.15%, PIK Interest 1.95%, 2.55% Exit Fee

$

42,255

 

 

42,636

 

 

42,777

 

 

Internet Consumer & Business Services

Senior Secured

August 2020

Interest rate PRIME + 5.65% or Floor rate of 10.65%, PIK Interest 1.95%, 2.55% Exit Fee

$

5,083

 

 

4,951

 

 

4,972

 

Total Snagajob.com, Inc.

 

 

 

 

$

47,338

 

 

47,587

 

 

47,749

 

Tectura Corporation (7)(8)(9)(14)

Internet Consumer & Business Services

Senior Secured

June 2021

Interest rate FIXED 6.00%, PIK Interest 3.00%

$

21,243

 

 

21,243

 

 

9,670

 

 

Internet Consumer & Business Services

Senior Secured

June 2021

PIK Interest 8.00%

$

10,680

 

 

240

 

 

 

Total Tectura Corporation

 

 

 

 

$

31,923

 

 

21,483

 

 

9,670

 

Thumbtack, Inc. (13)(14)

Internet Consumer & Business Services

Senior Secured

May 2022

Interest rate PRIME + 3.45% or Floor rate of 7.95%, PIK Interest 1.50%, 2.95% Exit Fee

$

25,100

 

 

24,823

 

 

24,823

 

Wheels Up Partners LLC (11)

Internet Consumer & Business Services

Senior Secured

July 2022

Interest rate 3-month LIBOR + 8.55% or Floor rate of 9.55%

$

18,717

 

 

18,584

 

 

18,589

 

Xometry, Inc. (13)(19)

Internet Consumer & Business Services

Senior Secured

November 2021

Interest rate PRIME + 3.95% or Floor rate of 8.45%, 7.09% Exit Fee

$

11,000

 

 

11,163

 

 

11,304

 

Subtotal: 1-5 Years Maturity

 

 

 

 

 

 

 

 

385,082

 

 

374,811

 

Subtotal: Internet Consumer & Business Services (34.08%)*

 

 

 

 

 

386,779

 

 

376,508

 

Media/Content/Info

 

 

 

 

 

 

 

 

 

 

 

 

 

1-5 Years Maturity

 

 

 

 

 

 

 

 

 

 

 

 

 

Bustle (14)(15)

Media/Content/Info

Senior Secured

June 2021

Interest rate PRIME + 4.10% or Floor rate of 8.35%, PIK Interest 1.95%, 3.12% Exit Fee

$

15,467

 

 

15,481

 

 

15,784

 

Subtotal: 1-5 Years Maturity

 

 

 

 

 

 

 

 

15,481

 

 

15,784

 

Subtotal: Media/Content/Info (1.43%)*

 

 

 

 

 

15,481

 

 

15,784

 

Medical Devices & Equipment

 

 

 

 

 

 

 

 

 

 

 

 

 

Under 1 Year Maturity

 

 

 

 

 

 

 

 

 

 

 

 

 

Micell Technologies, Inc. (8)

Medical Devices & Equipment

Senior Secured

August 2019

Interest rate PRIME + 7.25% or Floor rate of 10.50%, 5.00% Exit Fee

$

1,657

 

 

2,069

 

 

515

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

See notes to consolidated financial statements

12


HERCULES CAPITAL, INC.

CONSOLIDATED SCHEDULE OF INVESTMENTS

June 30, 2019

(unaudited)

(dollars in thousands)

 

 

Portfolio Company

Sub-Industry

Type of

Investment (1)

Maturity Date

Interest Rate and Floor (2)

Principal

Amount

 

Cost (3)

 

Value (4)

 

Quanta Fluid Solutions (5)(10)

Medical Devices & Equipment

Senior Secured

April 2020

Interest rate PRIME + 8.05% or Floor rate of 11.55%, 5.00% Exit Fee

$

3,603

 

$

4,183

 

$

4,183

 

Subtotal: Under 1 Year Maturity

 

 

 

 

 

6,252

 

 

4,698

 

1-5 Years Maturity

 

 

 

 

 

 

 

 

 

 

 

 

 

Flowonix Medical Incorporated (11)(14)

Medical Devices & Equipment

Senior Secured

October 2021

Interest rate PRIME + 4.00% or Floor rate of 9.00%, PIK Interest 0.5%, 7.95% Exit Fee

$

15,043

 

 

15,087

 

 

15,183

 

Intuity Medical, Inc. (11)(15)

Medical Devices & Equipment

Senior Secured

June 2021

Interest rate PRIME + 5.00% or Floor rate of 9.25%, 6.95% Exit Fee

$

16,345

 

 

16,702

 

 

16,769

 

Quanterix Corporation (11)

Medical Devices & Equipment

Senior Secured

October 2021

Interest rate PRIME + 2.75% or Floor rate of 8.00%, 0.96% Exit Fee

$

7,688

 

 

7,646

 

 

7,669

 

Rapid Micro Biosystems, Inc. (11)(15)

Medical Devices & Equipment

Senior Secured

April 2022

Interest rate PRIME + 5.15% or Floor rate of 9.65%, 7.25% Exit Fee

$

18,000

 

 

18,368

 

 

18,496

 

Sebacia, Inc. (11)(15)

Medical Devices & Equipment

Senior Secured

January 2021

Interest rate PRIME + 4.35% or Floor rate of 8.85%, 6.05% Exit Fee

$

11,000

 

 

11,337

 

 

11,301

 

Transenterix, Inc. (10)(11)

Medical Devices & Equipment

Senior Secured

June 2022

Interest rate PRIME + 4.55% or Floor rate of 9.55%, 6.95% Exit Fee

$

30,000

 

 

30,283

 

 

30,073

 

Subtotal: 1-5 Years Maturity

 

 

 

 

 

99,423

 

 

99,491

 

Subtotal: Medical Devices & Equipment (9.43%)*

 

 

 

 

 

105,675

 

 

104,189

 

Semiconductors

 

 

 

 

 

 

 

 

 

 

 

 

 

1-5 Years Maturity

 

 

 

 

 

 

 

 

 

 

 

 

 

Elenion Technologies Corporation (13)(14)

Semiconductors

Senior Secured

February 2022

Interest rate PRIME + 4.25% or Floor rate of 9.75%, PIK Interest 2.25%, 5.00% Exit Fee

$

10,071

 

 

10,053

 

 

10,053

 

Subtotal: 1-5 Years Maturity

 

 

 

 

 

10,053

 

 

10,053

 

Subtotal: Semiconductors (0.91%)*

 

 

 

 

 

10,053

 

 

10,053

 

Software

 

 

 

 

 

 

 

 

 

 

 

 

 

Under 1 Year Maturity

 

 

 

 

 

 

 

 

 

 

 

 

 

Lightbend, Inc. (14)(15)

Software

Senior Secured

December 2019

Interest rate PRIME + 4.25% or Floor rate of 8.50%, PIK Interest 2.00%, 9.95% Exit Fee

$

2,006

 

 

2,045

 

 

2,045

 

Subtotal: Under 1 Year Maturity

 

 

 

 

 

2,045

 

 

2,045

 

1-5 Years Maturity

 

 

 

 

 

 

 

 

 

 

 

 

 

Abrigo (18)

Software

Senior Secured

March 2023

Interest rate 3-month LIBOR + 7.88% or Floor rate of 7.88%

$

39,502

 

 

38,756

 

 

39,151

 

Businessolver.com, Inc. (11)(16)(17)

Software

Senior Secured

May 2023

Interest rate 3-month LIBOR + 7.50% or Floor rate of 7.50%

$

55,208

 

 

54,298

 

 

54,847

 

 

Software

Senior Secured

May 2023

Interest rate 3-month LIBOR + 7.50% or Floor rate of 7.50%

$

765

 

 

765

 

 

765

 

Total Businessolver.com, Inc.

 

 

 

 

$

55,973

 

 

55,063

 

 

55,612

 

Clarabridge, Inc. (12)(14)(17)

Software

Senior Secured

April 2022

Interest rate PRIME + 4.80% or Floor rate of 8.55%, PIK Interest 2.25%

$

42,756

 

 

42,368

 

 

42,795

 

Cloud 9 Software (13)(17)

Software

Senior Secured

April 2024

Interest rate 3-month LIBOR + 8.20% or Floor rate of 9.20%

$

9,500

 

 

9,316

 

 

9,316

 

Cloudian, Inc. (11)

Software

Senior Secured

November 2022

Interest rate PRIME + 3.25% or Floor rate of 8.25%, 9.75% Exit Fee

$

15,000

 

 

15,058

 

 

15,145

 

Couchbase, Inc. (11)(15)(19)

Software

Senior Secured

May 2023

Interest rate PRIME + 5.25% or Floor rate of 10.75%, 3.75% Exit Fee

$

40,000

 

 

39,521

 

 

39,614

 

Credible Behavioral Health, Inc. (11)(14)

Software

Senior Secured

September 2021

Interest rate PRIME + 3.20% or Floor rate of 7.95%, PIK Interest 3.30%

$

7,700

 

 

7,639

 

 

7,639

 

Dashlane, Inc. (11)(14)(19)

Software

Senior Secured

April 2022

Interest rate PRIME + 4.05% or Floor rate of 8.55%, PIK Interest 1.10%, 9.25% Exit Fee

$

10,123

 

 

10,287

 

 

10,445

 

 

Software

Senior Secured

March 2023

Interest rate PRIME + 4.05% or Floor rate of 8.55%, PIK Interest 1.10%, 4.95% Exit Fee

$

10,025

 

 

9,764

 

 

9,764

 

Total Dashlane, Inc.

 

 

 

 

$

20,148

 

 

20,051

 

 

20,209

 

Evernote Corporation (11)(14)(15)(19)

Software

Senior Secured

October 2020

Interest rate PRIME + 5.45% or Floor rate of 8.95%

$

5,549

 

 

5,430

 

 

5,431

 

 

Software

Senior Secured

July 2021

Interest rate PRIME + 6.00% or Floor rate of 9.50%, PIK Interest 1.25%

$

4,100

 

 

3,988

 

 

3,993

 

 

Software

Senior Secured

July 2022

Interest rate PRIME + 6.00% or Floor rate of 9.50%, PIK Interest 1.25%

$

5,045

 

 

4,961

 

 

5,089

 

Total Evernote Corporation

 

 

 

 

$

14,694

 

 

14,379

 

 

14,513

 

FPX, LLC (13)(17)

Software

Senior Secured

May 2024

Interest rate 1-month LIBOR + 8.65% or Floor rate of 9.65%

$

6,000

 

 

5,883

 

 

5,883

 

Fuze, Inc. (13)(14)(15)(19)

Software

Senior Secured

July 2021

Interest rate PRIME + 3.70% or Floor rate of 7.95%, PIK Interest 1.55%, 3.55% Exit Fee

$

51,531

 

 

52,048

 

 

53,055

 

Insurance Technologies Corporation (11)(18)

Software

Senior Secured

March 2023

Interest rate 3-month LIBOR + 7.82% or Floor rate of 8.75%

$

12,500

 

 

12,283

 

 

12,408

 

See notes to consolidated financial statements

13


HERCULES CAPITAL, INC.

CONSOLIDATED SCHEDULE OF INVESTMENTS

June 30, 2019

(unaudited)

(dollars in thousands)

 

 

Portfolio Company

Sub-Industry

Type of

Investment (1)

Maturity Date

Interest Rate and Floor (2)

Principal

Amount

 

Cost (3)

 

Value (4)

 

Kazoo, Inc. (p.k.a. YouEarnedIt, Inc.) (11)(18)

Software

Senior Secured

July 2023

Interest rate 1-month LIBOR + 8.66%

$

8,933

 

$

8,712

 

$

8,712

 

Lastline, Inc. (19)

Software

Senior Secured

July 2022

Interest rate PRIME + 5.45% or Floor rate of 10.95%

$

6,000

 

 

5,799

 

 

5,799

 

Lightbend, Inc. (14)(15)

Software

Senior Secured

February 2022

Interest rate PRIME + 4.25% or Floor rate of 8.50%, PIK Interest 2.00%

$

16,342

 

 

16,090

 

 

16,151

 

Lithium Technologies, Inc. (11)

Software

Senior Secured

October 2022

Interest rate 1-month LIBOR + 8.00% or Floor rate of 9.00%

$

12,000

 

 

11,809

 

 

11,809

 

 

Software

Senior Secured

October 2022

Interest rate 1-month LIBOR + 8.00% or Floor rate of 9.00%

$

43,000

 

 

42,118

 

 

42,118

 

         Total Lithium Technologies, Inc.

$

55,000

 

 

53,927

 

 

53,927

 

Nuvolo Technologies Corporation (19)

Software

Senior Secured

April 2022

Interest rate PRIME + 6.25% or Floor rate of 11.75%

$

10,000

 

 

9,832

 

 

9,832

 

OrthoFi, Inc (13)(18)

Software

Senior Secured

April 2024

Interest rate 3-month LIBOR + 8.28% or Floor rate of 9.28%

$

17,853

 

 

17,376

 

 

17,376

 

Pollen, Inc. (15)

Software

Senior Secured

October 2020

Interest rate PRIME + 4.25% or Floor rate of 8.50%, 5.95% Exit Fee

$

7,000

 

 

7,291

 

 

7,246

 

Quid, Inc. (11)(14)(15)

Software

Senior Secured

November 2022

Interest rate PRIME + 4.45% or Floor rate of 9.95%, PIK Interest 2.25%, 3.61% Exit Fee

$

13,100

 

 

13,278

 

 

13,317

 

Regent Education (14)

Software

Senior Secured

January 2022

Interest rate FIXED 10.00%, PIK Interest 2.00%, 7.94% Exit Fee

$

3,123

 

 

3,164

 

 

1,591

 

Salsa Labs, Inc. (11)(17)

Software

Senior Secured

April 2023

Interest rate 3-month LIBOR + 8.15% or Floor rate of 9.15%

$

6,000

 

 

5,904

 

 

5,964

 

 

Software

Senior Secured

April 2023

Interest rate 3-month LIBOR + 8.15% or Floor rate of 9.15%

$

150

 

 

150

 

 

150

 

Total Salsa Labs, Inc.

 

 

 

 

$

6,150

 

 

6,054

 

 

6,114

 

ThreatConnect, Inc. (13)(17)(19)

Software

Senior Secured

May 2024

Interest rate 1-month LIBOR + 8.25% or Floor rate of 9.25%

$

10,000

 

 

9,852

 

 

9,852

 

Vela Trading Technologies (11)(18)

Software

Senior Secured

July 2022

Interest rate 3-month LIBOR + 9.50% or Floor rate of 10.50%

$

19,500

 

 

19,055

 

 

19,055

 

ZeroFox, Inc.

Software

Senior Secured

January 2023

Interest rate PRIME + 4.75% or Floor rate of 10.25%, 3.00% Exit Fee

$

15,000

 

 

14,830

 

 

14,830

 

ZocDoc (11)(19)

Software

Senior Secured

August 2021

Interest rate PRIME + 6.20% or Floor rate of 10.95%, 2.00% Exit Fee

$

30,000

 

 

30,114

 

 

30,236

 

Subtotal: 1-5 Years Maturity

 

 

 

 

 

527,739

 

 

529,378

 

Greater than 5 Years Maturity

 

 

 

 

 

 

 

 

 

 

 

 

 

Campaign Monitor Limited (11)(17)(19)

Software

Senior Secured

November 2025

Interest rate 3-month LIBOR + 8.50% or Floor rate of 9.50%

$

29,333

 

 

28,634

 

 

28,634

 

Imperva, Inc. (19)

Software

Senior Secured

January 2027

Interest rate 3-month LIBOR + 7.75% or Floor rate of 7.75%

$

20,000

 

 

19,796

 

 

19,796

 

Subtotal: Greater than 5 Years Maturity

 

 

 

 

 

48,430

 

 

48,430

 

Subtotal: Software (52.49%)*

 

 

 

 

 

578,214

 

 

579,853

 

Sustainable and Renewable Technology

 

 

 

 

 

 

 

 

 

 

Under 1 Year Maturity

 

 

 

 

 

 

 

 

 

 

 

 

 

FuelCell Energy, Inc. (12)

Sustainable and Renewable Technology

Senior Secured

August 2019

Interest rate PRIME + 5.40% or Floor rate of 9.90%, 6.68% Exit Fee

$

7,070

 

 

7,395

 

 

7,266

 

 

Sustainable and Renewable Technology

Senior Secured

August 2019

Interest rate PRIME + 5.40% or Floor rate of 9.90%

$

6,432

 

 

6,216

 

 

6,108

 

Total FuelCell Energy, Inc.

 

 

 

 

$

13,502

 

 

13,611

 

 

13,374

 

Solar Spectrum Holdings LLC (p.k.a. Sungevity, Inc.) (6)(8)(14)(19)

Sustainable and Renewable Technology

Senior Secured

August 2019

Interest rate PRIME + 8.70% or Floor rate of 13.70%, 6.67% Exit Fee

$

10,000

 

 

10,614

 

 

10,614

 

 

Sustainable and Renewable Technology

Senior Secured

July 2019

PIK Interest 10.00%

$

683

 

 

683

 

 

683

 

 

Sustainable and Renewable Technology

Senior Secured

July 2019

Interest rate PRIME + 10.70% or Floor rate of 15.70%, PIK Interest 2.00%

$

1,620

 

 

1,620

 

 

1,620

 

         Total Solar Spectrum Holdings LLC (p.k.a. Sungevity, Inc.)

$

12,303

 

 

12,917

 

 

12,917

 

Subtotal: Under 1 Year Maturity

 

 

 

 

 

26,528

 

 

26,291

 

1-5 Years Maturity

 

 

 

 

 

 

 

 

 

 

 

 

 

Impossible Foods, Inc. (12)

Sustainable and Renewable Technology

Senior Secured

January 2022

Interest rate PRIME + 3.95% or Floor rate of 8.95%, 9.00% Exit Fee

$

50,000

 

 

50,656

 

 

50,680

 

Metalysis Limited (5)(8)(10)(11)

Sustainable and Renewable Technology

Senior Secured

March 2021

Interest rate PRIME + 5.00% or Floor rate of 9.25%, 6.95% Exit Fee

$

3,935

 

 

4,177

 

 

1,954

 

Proterra, Inc. (11)(14)

Sustainable and Renewable Technology

Senior Secured

May 2021

Interest rate PRIME + 5.05% or Floor rate of 10.55%, PIK Interest 1.75%

$

10,012

 

 

9,956

 

 

9,991

 

Subtotal: 1-5 Years Maturity

 

 

 

 

 

64,789

 

 

62,625

 

Subtotal: Sustainable and Renewable Technology (8.05%)*

 

 

 

 

 

91,317

 

 

88,916

 

Total: Debt Investments (186.62%)*

 

 

 

 

 

 

 

2,077,212

 

 

2,061,557

 

 

 

See notes to consolidated financial statements

14


HERCULES CAPITAL, INC.

CONSOLIDATED SCHEDULE OF INVESTMENTS

June 30, 2019

(unaudited)

(dollars in thousands)

Portfolio Company

 

Sub-Industry

 

Type of

Investment (1)

 

Series

 

Shares

 

 

Cost (3)

 

 

Value (4)

 

Equity Investments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Communications & Networking

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Peerless Network Holdings, Inc.

 

Communications & Networking

 

Equity

 

Preferred Series A

 

 

1,135,000

 

 

$

1,230

 

 

$

4,482

 

Subtotal: Communications & Networking (0.41%)*

 

 

 

1,230

 

 

 

4,482

 

Diagnostic

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Singulex, Inc.

 

Diagnostic

 

Equity

 

Common Stock

 

 

937,998

 

 

 

750

 

 

 

414

 

Subtotal: Diagnostic (0.04%)*

 

 

 

 

 

 

 

 

 

 

 

 

750

 

 

 

414

 

Diversified Financial Services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gibraltar Business Capital, LLC (7)

 

Diversified Financial Services

 

Equity

 

Common Stock

 

 

830,000

 

 

 

1,884

 

 

 

2,117

 

 

 

Diversified Financial Services

 

Equity

 

Preferred Series A

 

 

10,602,752

 

 

 

26,122

 

 

 

29,353

 

Total Gibraltar Business Capital, LLC

 

 

 

 

 

 

 

 

11,432,752

 

 

 

28,006

 

 

 

31,470

 

Subtotal: Diversified Financial Services (2.85%)*

 

 

 

 

 

 

28,006

 

 

 

31,470

 

Drug Delivery

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AcelRx Pharmaceuticals, Inc. (4)

 

Drug Delivery

 

Equity

 

Common Stock

 

 

176,730

 

 

 

1,329

 

 

 

447

 

BioQ Pharma Incorporated (15)

 

Drug Delivery

 

Equity

 

Preferred Series D

 

 

165,000

 

 

 

500

 

 

 

780

 

Kaleo, Inc.

 

Drug Delivery

 

Equity

 

Preferred Series B

 

 

82,500

 

 

 

1,007

 

 

 

3,244

 

Neos Therapeutics, Inc. (4)(15)

 

Drug Delivery

 

Equity

 

Common Stock

 

 

125,000

 

 

 

1,500

 

 

 

161

 

PDS Biotechnology Corporation (p.k.a. Edge Therapeutics, Inc.) (4)

 

Drug Delivery

 

Equity

 

Common Stock

 

 

2,498

 

 

 

309

 

 

 

15

 

Subtotal: Drug Delivery (0.42%)*

 

 

 

 

 

 

4,645

 

 

 

4,647

 

Drug Discovery & Development

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Aveo Pharmaceuticals, Inc. (4)(15)

 

Drug Discovery & Development

 

Equity

 

Common Stock

 

 

1,901,791

 

 

 

1,715

 

 

 

1,280

 

Axovant Gene Therapies Ltd. (p.k.a. Axovant Sciences Ltd.) (4)(5)(10)

 

Drug Discovery & Development

 

Equity

 

Common Stock

 

 

16,228

 

 

 

1,269

 

 

 

101

 

BridgeBio Pharma LLC (4)(16)

 

Drug Discovery & Development

 

Equity

 

Common Stock

 

 

203,578

 

 

 

2,000

 

 

 

5,491

 

Cerecor, Inc. (4)

 

Drug Discovery & Development

 

Equity

 

Common Stock

 

 

119,087

 

 

 

1,000

 

 

 

649

 

Concert Pharmaceuticals, Inc. (4)(10)

 

Drug Discovery & Development

 

Equity

 

Common Stock

 

 

70,796

 

 

 

1,367

 

 

 

799

 

Dare Biosciences, Inc. (4)

 

Drug Discovery & Development

 

Equity

 

Common Stock

 

 

13,550

 

 

 

1,000

 

 

 

12

 

Dynavax Technologies (4)(10)

 

Drug Discovery & Development

 

Equity

 

Common Stock

 

 

20,000

 

 

 

550

 

 

 

80

 

Eidos Therapeutics, Inc. (4)(10)

 

Drug Discovery & Development

 

Equity

 

Common Stock

 

 

15,000

 

 

 

255

 

 

 

466

 

Genocea Biosciences, Inc. (4)

 

Drug Discovery & Development

 

Equity

 

Common Stock

 

 

27,932

 

 

 

2,000

 

 

 

109

 

Insmed, Incorporated (4)

 

Drug Discovery & Development

 

Equity

 

Common Stock

 

 

50,771

 

 

 

717

 

 

 

1,300

 

Melinta Therapeutics (4)

 

Drug Discovery & Development

 

Equity

 

Common Stock

 

 

10,364

 

 

 

2,000

 

 

 

69

 

Paratek Pharmaceuticals, Inc. (4)(16)

 

Drug Discovery & Development

 

Equity

 

Common Stock

 

 

76,362

 

 

 

2,744

 

 

 

304

 

Rocket Pharmaceuticals, Ltd. (4)

 

Drug Discovery & Development

 

Equity

 

Common Stock

 

 

944

 

 

 

1,500

 

 

 

14

 

Savara, Inc. (4)(15)

 

Drug Discovery & Development

 

Equity

 

Common Stock

 

 

11,119

 

 

 

203

 

 

 

26

 

uniQure B.V. (4)(5)(10)

 

Drug Discovery & Development

 

Equity

 

Common Stock

 

 

37,175

 

 

 

718

 

 

 

2,784

 

Subtotal: Drug Discovery & Development (1.22%)*

 

 

 

 

 

 

19,038

 

 

 

13,484

 

Healthcare Services, Other

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

23andMe, Inc.

 

Healthcare Services, Other

 

Equity

 

Common Stock

 

 

360,000

 

 

 

5,094

 

 

 

5,094

 

Subtotal: Healthcare Services, Other (0.46%)*

 

 

 

 

 

 

5,094

 

 

 

5,094

 

Information Services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

DocuSign, Inc. (4)

 

Information Services

 

Equity

 

Common Stock

 

 

366,316

 

 

 

5,773

 

 

 

17,120

 

Subtotal: Information Services (1.55%)*

 

 

 

 

 

 

5,773

 

 

 

17,120

 

Internet Consumer & Business Services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Blurb, Inc.

 

Internet Consumer & Business Services

 

Equity

 

Preferred Series B

 

 

220,653

 

 

 

175

 

 

 

41

 

Contentful, Inc. (5)(10)

 

Internet Consumer & Business Services

 

Equity

 

Preferred Series D

 

 

217

 

 

 

500

 

 

 

495

 

Countable Corporation (p.k.a. Brigade Group, Inc.)

 

Internet Consumer & Business Services

 

Equity

 

Common Stock

 

 

9,023

 

 

 

93

 

 

 

 

DoorDash, Inc.

 

Internet Consumer & Business Services

 

Equity

 

Common Stock

 

 

105,000

 

 

 

6,051

 

 

 

14,422

 

Lightspeed POS, Inc. (4)(5)(10)

 

Internet Consumer & Business Services

 

Equity

 

Common Stock

 

 

107,177

 

 

 

500

 

 

 

2,975

 

Lyft, Inc. (4)

 

Internet Consumer & Business Services

 

Equity

 

Common Stock

 

 

200,738

 

 

 

10,487

 

 

 

13,189

 

Nextdoor.com, Inc.

 

Internet Consumer & Business Services

 

Equity

 

Common Stock

 

 

328,190

 

 

 

4,854

 

 

 

6,101

 

OfferUp, Inc.

 

Internet Consumer & Business Services

 

Equity

 

Preferred Series A

 

 

286,080

 

 

 

1,663

 

 

 

2,065

 

 

 

Internet Consumer & Business Services

 

Equity

 

Preferred Series A-1

 

 

108,710

 

 

 

632

 

 

 

785

 

Total OfferUp, Inc.

 

 

 

 

 

 

 

 

394,790

 

 

 

2,295

 

 

 

2,850

 

Oportun

 

Internet Consumer & Business Services

 

Equity

 

Preferred Series G

 

 

218,351

 

 

 

250

 

 

 

953

 

 

 

Internet Consumer & Business Services

 

Equity

 

Preferred Series H

 

 

87,802

 

 

 

250

 

 

 

400

 

Total Oportun

 

 

 

 

 

 

 

 

306,153

 

 

 

500

 

 

 

1,353

 

See notes to consolidated financial statements

 

15


HERCULES CAPITAL, INC.

CONSOLIDATED SCHEDULE OF INVESTMENTS

June 30, 2019

(unaudited)

(dollars in thousands)

 

 

Portfolio Company

 

Sub-Industry

 

Type of

Investment (1)

 

Series

 

Shares

 

 

Cost (3)

 

 

Value (4)

 

Tectura Corporation (7)

 

Internet Consumer & Business Services

 

Equity

 

Common Stock

 

 

414,994,863

 

 

$

900

 

 

$

 

 

 

Internet Consumer & Business Services

 

Equity

 

Preferred Series BB

 

 

1,000,000

 

 

 

 

 

 

 

Total Tectura Corporation

 

 

 

 

 

 

 

 

415,994,863

 

 

 

900

 

 

 

 

Subtotal: Internet Consumer & Business Services (3.75%)*

 

 

 

 

 

 

26,355

 

 

 

41,426

 

Media/Content/Info

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pinterest, Inc. (4)

 

Media/Content/Info

 

Equity

 

Preferred Series Seed

 

 

206,666

 

 

 

4,085

 

 

 

5,625

 

Subtotal: Media/Content/Info (0.51%)*

 

 

 

 

 

 

4,085

 

 

 

5,625

 

Medical Devices & Equipment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Flowonix Medical Incorporated

 

Medical Devices & Equipment

 

Equity

 

Preferred Series AA

 

 

221,893

 

 

 

1,500

 

 

 

 

Gelesis, Inc.

 

Medical Devices & Equipment

 

Equity

 

Common Stock

 

 

199,649

 

 

 

 

 

 

969

 

 

 

Medical Devices & Equipment

 

Equity

 

Preferred Series A-1

 

 

191,210

 

 

 

425

 

 

 

1,021

 

 

 

Medical Devices & Equipment

 

Equity

 

Preferred Series A-2

 

 

191,626

 

 

 

500

 

 

 

973

 

Total Gelesis, Inc.

 

 

 

 

 

 

 

 

582,485

 

 

 

925

 

 

 

2,963

 

Medrobotics Corporation (15)

 

Medical Devices & Equipment

 

Equity

 

Preferred Series E

 

 

136,798

 

 

 

250

 

 

 

 

 

 

Medical Devices & Equipment

 

Equity

 

Preferred Series F

 

 

73,971

 

 

 

155

 

 

 

 

 

 

Medical Devices & Equipment

 

Equity

 

Preferred Series G

 

 

163,934

 

 

 

500

 

 

 

 

Total Medrobotics Corporation

 

 

 

 

 

 

 

 

374,703

 

 

 

905

 

 

 

 

Optiscan Biomedical, Corp. (6)

 

Medical Devices & Equipment

 

Equity

 

Preferred Series B

 

 

61,855

 

 

 

3,000

 

 

 

411

 

 

 

Medical Devices & Equipment

 

Equity

 

Preferred Series C

 

 

19,273

 

 

 

655

 

 

 

117

 

 

 

Medical Devices & Equipment

 

Equity

 

Preferred Series D

 

 

551,038

 

 

 

5,257

 

 

 

3,456

 

 

 

Medical Devices & Equipment

 

Equity

 

Preferred Series E

 

 

507,103

 

 

 

4,240

 

 

 

4,138

 

Total Optiscan Biomedical, Corp.

 

 

 

 

 

 

 

 

1,139,269

 

 

 

13,152

 

 

 

8,122

 

Outset Medical, Inc.

 

Medical Devices & Equipment

 

Equity

 

Preferred Series B

 

 

232,061

 

 

 

527

 

 

 

543

 

Quanterix Corporation (4)

 

Medical Devices & Equipment

 

Equity

 

Common Stock

 

 

13,281

 

 

 

157

 

 

 

449

 

Subtotal: Medical Devices & Equipment (1.09%)*

 

 

 

 

 

 

17,166

 

 

 

12,077

 

Software

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CapLinked, Inc.

 

Software

 

Equity

 

Preferred Series A-3

 

 

53,614

 

 

 

51

 

 

 

97

 

Docker, Inc.

 

Software

 

Equity

 

Common Stock

 

 

200,000

 

 

 

4,284

 

 

 

4,452

 

Druva Holdings, Inc. (p.k.a. Druva, Inc.)

 

Software

 

Equity

 

Preferred Series 2

 

 

458,841

 

 

 

1,000

 

 

 

1,605

 

 

 

Software

 

Equity

 

Preferred Series 3

 

 

93,620

 

 

 

300

 

 

 

388

 

Total Druva Holdings, Inc. (p.k.a. Druva, Inc.)

 

 

 

 

 

 

 

 

552,461

 

 

 

1,300

 

 

 

1,993

 

HighRoads, Inc.

 

Software

 

Equity

 

Common Stock

 

 

190

 

 

 

307

 

 

 

 

Palantir Technologies

 

Software

 

Equity

 

Preferred Series D

 

 

9,535

 

 

 

47

 

 

 

49

 

 

 

Software

 

Equity

 

Preferred Series E

 

 

1,749,089

 

 

 

10,489

 

 

 

8,997

 

 

 

Software

 

Equity

 

Preferred Series G

 

 

326,797

 

 

 

2,211

 

 

 

1,680

 

Total Palantir Technologies

 

 

 

 

 

 

 

 

2,085,421

 

 

 

12,747

 

 

 

10,726

 

Sprinklr, Inc.

 

Software

 

Equity

 

Common Stock

 

 

700,000

 

 

 

3,749

 

 

 

4,003

 

Subtotal: Software (1.93%)*

 

 

 

 

 

 

22,438

 

 

 

21,271

 

Surgical Devices

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gynesonics, Inc. (15)

 

Surgical Devices

 

Equity

 

Preferred Series B

 

 

219,298

 

 

 

250

 

 

 

8

 

 

 

Surgical Devices

 

Equity

 

Preferred Series C

 

 

656,538

 

 

 

282

 

 

 

25

 

 

 

Surgical Devices

 

Equity

 

Preferred Series D

 

 

1,991,157

 

 

 

712

 

 

 

79

 

 

 

Surgical Devices

 

Equity

 

Preferred Series E

 

 

2,786,367

 

 

 

429

 

 

 

132

 

 

 

Surgical Devices

 

Equity

 

Preferred Series F

 

 

1,523,693

 

 

 

118

 

 

 

141

 

 

 

Surgical Devices

 

Equity

 

Preferred Series F-1

 

 

2,418,125

 

 

 

150

 

 

 

196

 

Total Gynesonics, Inc.

 

 

 

 

 

 

 

 

9,595,178

 

 

 

1,941

 

 

 

581

 

TransMedics Group, Inc. (p.k.a Transmedics, Inc.) (4)

 

Surgical Devices

 

Equity

 

Common Stock

 

 

162,617

 

 

 

2,550

 

 

 

4,714

 

Subtotal: Surgical Devices (0.48%)*

 

 

 

 

 

 

4,491

 

 

 

5,295

 

Sustainable and Renewable Technology

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Impossible Foods, Inc.

 

Sustainable and Renewable Technology

 

Equity

 

Preferred Series E-1

 

 

188,611

 

 

 

2,000

 

 

 

2,000

 

Modumetal, Inc.

 

Sustainable and Renewable Technology

 

Equity

 

Preferred Series A-1

 

 

103,584

 

 

 

500

 

 

 

10

 

Proterra, Inc.

 

Sustainable and Renewable Technology

 

Equity

 

Preferred Series 5

 

 

99,280

 

 

 

500

 

 

 

398

 

Solar Spectrum Holdings LLC (p.k.a. Sungevity, Inc.) (6)

 

Sustainable and Renewable Technology

 

Equity

 

Common Stock

 

 

380

 

 

 

61,501

 

 

 

125

 

Subtotal: Sustainable and Renewable Technology (0.23%)*

 

 

 

 

 

 

64,501

 

 

 

2,533

 

Total: Equity Investments (14.93%)*

 

 

 

 

 

 

 

 

 

 

 

 

203,572

 

 

 

164,938

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

See notes to consolidated financial statements

16


HERCULES CAPITAL, INC.

CONSOLIDATED SCHEDULE OF INVESTMENTS

June 30, 2019

(unaudited)

(dollars in thousands)

 

 

Portfolio Company

 

Sub-Industry

 

Type of

Investment (1)

 

Series

 

Shares

 

 

Cost (3)

 

 

Value (4)

 

Warrant Investments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Communications & Networking

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Peerless Network Holdings, Inc.

 

Communications & Networking

 

Warrant

 

Common Stock

 

 

3,328

 

 

$

 

 

$

9

 

Spring Mobile Solutions, Inc.

 

Communications & Networking

 

Warrant

 

Common Stock

 

 

2,834,375

 

 

 

418

 

 

 

 

Subtotal: Communications & Networking (0.00%)*

 

 

 

 

 

 

418

 

 

 

9

 

Consumer & Business Products

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gadget Guard (15)

 

Consumer & Business Products

 

Warrant

 

Common Stock

 

 

1,662,441

 

 

 

228

 

 

 

 

Intelligent Beauty, Inc.

 

Consumer & Business Products

 

Warrant

 

Preferred Series B

 

 

190,234

 

 

 

230

 

 

 

353

 

The Neat Company

 

Consumer & Business Products

 

Warrant

 

Common Stock

 

 

54,054

 

 

 

365

 

 

 

 

WHOOP, INC.

 

Consumer & Business Products

 

Warrant

 

Preferred Series C

 

 

68,627

 

 

 

18

 

 

 

7

 

Subtotal: Consumer & Business Products (0.03%)*

 

 

 

 

 

 

841

 

 

 

360

 

Drug Delivery

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Agile Therapeutics, Inc. (4)

 

Drug Delivery

 

Warrant

 

Common Stock

 

 

180,274

 

 

 

730

 

 

 

44

 

BioQ Pharma Incorporated

 

Drug Delivery

 

Warrant

 

Common Stock

 

 

459,183

 

 

 

1

 

 

 

925

 

Dance Biopharm, Inc. (15)

 

Drug Delivery

 

Warrant

 

Common Stock

 

 

110,882

 

 

 

74

 

 

 

 

Neos Therapeutics, Inc. (4)(15)

 

Drug Delivery

 

Warrant

 

Common Stock

 

 

70,833

 

 

 

285

 

 

 

 

PDS Biotechnology Corporation (p.k.a. Edge Therapeutics, Inc.) (4)

 

Drug Delivery

 

Warrant

 

Common Stock

 

 

3,929

 

 

 

389

 

 

 

 

Pulmatrix Inc. (4)

 

Drug Delivery

 

Warrant

 

Common Stock

 

 

2,515

 

 

 

116

 

 

 

 

ZP Opco, Inc. (4)

 

Drug Delivery

 

Warrant

 

Common Stock

 

 

3,618

 

 

 

265

 

 

 

 

Subtotal: Drug Delivery (0.09%)*

 

 

 

 

 

 

1,860

 

 

 

969

 

Drug Discovery & Development

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Acacia Pharma Inc. (4)(5)(10)

 

Drug Discovery & Development

 

Warrant

 

Common Stock

 

 

201,330

 

 

 

304

 

 

 

40

 

ADMA Biologics, Inc. (4)

 

Drug Discovery & Development

 

Warrant

 

Common Stock

 

 

89,750

 

 

 

295

 

 

 

37

 

Brickell Biotech, Inc.

 

Drug Discovery & Development

 

Warrant

 

Preferred Series C

 

 

26,086

 

 

 

119

 

 

 

 

Cerecor, Inc. (4)

 

Drug Discovery & Development

 

Warrant

 

Common Stock

 

 

22,328

 

 

 

70

 

 

 

18

 

Concert Pharmaceuticals, Inc. (4)(10)(15)

 

Drug Discovery & Development

 

Warrant

 

Common Stock

 

 

61,273

 

 

 

178

 

 

 

123

 

CTI BioPharma Corp. (4)

 

Drug Discovery & Development

 

Warrant

 

Common Stock

 

 

29,239

 

 

 

165

 

 

 

 

CytRx Corporation (4)(15)

 

Drug Discovery & Development

 

Warrant

 

Common Stock

 

 

105,694

 

 

 

160

 

 

 

 

Dare Biosciences, Inc. (4)

 

Drug Discovery & Development

 

Warrant

 

Common Stock

 

 

17,190

 

 

 

369

 

 

 

 

Dermavant Sciences Ltd. (5)(10)

 

Drug Discovery & Development

 

Warrant

 

Common Stock

 

 

223,642

 

 

 

101

 

 

 

121

 

Dicerna Pharmaceuticals, Inc. (4)

 

Drug Discovery & Development

 

Warrant

 

Common Stock

 

 

200

 

 

 

28

 

 

 

 

Evofem Biosciences, Inc. (4)(15)

 

Drug Discovery & Development

 

Warrant

 

Common Stock

 

 

7,806

 

 

 

266

 

 

 

23

 

Fortress Biotech, Inc. (4)

 

Drug Discovery & Development

 

Warrant

 

Common Stock

 

 

73,009

 

 

 

142

 

 

 

7

 

Genocea Biosciences, Inc. (4)

 

Drug Discovery & Development

 

Warrant

 

Common Stock

 

 

50,391

 

 

 

431

 

 

 

81

 

Immune Pharmaceuticals (4)

 

Drug Discovery & Development

 

Warrant

 

Common Stock

 

 

10,742

 

 

 

164

 

 

 

 

Melinta Therapeutics (4)

 

Drug Discovery & Development

 

Warrant

 

Common Stock

 

 

8,109

 

 

 

626

 

 

 

 

Motif BioSciences Inc. (4)(5)(10)(15)

 

Drug Discovery & Development

 

Warrant

 

Common Stock

 

 

73,452

 

 

 

282

 

 

 

10

 

Myovant Sciences, Ltd. (4)(5)(10)

 

Drug Discovery & Development

 

Warrant

 

Common Stock

 

 

73,710

 

 

 

460

 

 

 

134

 

Neuralstem, Inc. (4)(15)

 

Drug Discovery & Development

 

Warrant

 

Common Stock

 

 

5,783

 

 

 

77

 

 

 

 

Ology Bioservices, Inc. (15)

 

Drug Discovery & Development

 

Warrant

 

Common Stock

 

 

171,389

 

 

 

838

 

 

 

 

Paratek Pharmaceuticals, Inc. (4)(15)(16)

 

Drug Discovery & Development

 

Warrant

 

Common Stock

 

 

94,841

 

 

 

204

 

 

 

9

 

Sorrento Therapeutics, Inc. (4)(10)

 

Drug Discovery & Development

 

Warrant

 

Common Stock

 

 

306,748

 

 

 

889

 

 

 

232

 

Stealth Bio Therapeutics Corp. (4)(5)(10)

 

Drug Discovery & Development

 

Warrant

 

American Depositary Shares

 

 

41,667

 

 

 

158

 

 

 

103

 

TG Therapeutics, Inc. (4)(10)

 

Drug Discovery & Development

 

Warrant

 

Common Stock

 

 

147,058

 

 

 

564

 

 

 

685

 

Tricida, Inc. (4)(15)

 

Drug Discovery & Development

 

Warrant

 

Common Stock

 

 

123,637

 

 

 

979

 

 

 

2,719

 

Urovant Sciences, Ltd. (4)(5)(10)

 

Drug Discovery & Development

 

Warrant

 

Common Stock

 

 

33,259

 

 

 

143

 

 

 

83

 

X4 Pharmaceuticals, Inc. (4)

 

Drug Discovery & Development

 

Warrant

 

Common Stock

 

 

25,000

 

 

 

314

 

 

 

102

 

XOMA Corporation (4)(10)(15)

 

Drug Discovery & Development

 

Warrant

 

Common Stock

 

 

9,063

 

 

 

279

 

 

 

2

 

Subtotal: Drug Discovery & Development (0.41%)*

 

 

 

 

 

 

8,605

 

 

 

4,529

 

Electronics & Computer Hardware

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

908 DEVICES INC. (15)

 

Electronics & Computer Hardware

 

Warrant

 

Preferred Series D

 

 

79,856

 

 

 

101

 

 

 

55

 

Subtotal: Electronics & Computer Hardware (0.00%)*

 

 

 

 

 

 

101

 

 

 

55

 

Healthcare Services, Other

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Chromadex Corporation (4)

 

Healthcare Services, Other

 

Warrant

 

Common Stock

 

 

139,673

 

 

 

157

 

 

 

191

 

Subtotal: Healthcare Services, Other (0.02%)*

 

 

 

 

 

 

157

 

 

 

191

 

Information Services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

INMOBI Inc. (5)(10)

 

Information Services

 

Warrant

 

Common Stock

 

 

65,587

 

 

 

82

 

 

 

 

MDX Medical, Inc. (15)

 

Information Services

 

Warrant

 

Common Stock

 

 

2,812,500

 

 

 

283

 

 

 

134

 

Netbase Solutions, Inc.

 

Information Services

 

Warrant

 

Preferred Series 1

 

 

60,000

 

 

 

356

 

 

 

396

 

Planet Labs, Inc.

 

Information Services

 

Warrant

 

Common Stock

 

 

54,832

 

 

 

565

 

 

 

549

 

RichRelevance, Inc.

 

Information Services

 

Warrant

 

Preferred Series E

 

 

112,612

 

 

 

98

 

 

 

 

Subtotal: Information Services (0.10%)*

 

 

 

 

 

 

1,384

 

 

 

1,079

 

Internet Consumer & Business Services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Aria Systems, Inc.

 

Internet Consumer & Business Services

 

Warrant

 

Preferred Series G

 

 

231,535

 

 

 

73

 

 

 

 

See notes to consolidated financial statements

17


HERCULES CAPITAL, INC.

CONSOLIDATED SCHEDULE OF INVESTMENTS

June 30, 2019

(unaudited)

(dollars in thousands)

 

 

Portfolio Company

 

Sub-Industry

 

Type of

Investment (1)

 

Series

 

Shares

 

 

Cost (3)

 

 

Value (4)

 

Blurb, Inc. (15)

 

Internet Consumer & Business Services

 

Warrant

 

Preferred Series C

 

 

234,280

 

 

$

636

 

 

$

9

 

Cloudpay, Inc. (5)(10)

 

Internet Consumer & Business Services

 

Warrant

 

Preferred Series B

 

 

4,960

 

 

 

45

 

 

 

12

 

Contentful, Inc. (5)(10)

 

Internet Consumer & Business Services

 

Warrant

 

Preferred Series C

 

 

82

 

 

 

1

 

 

 

36

 

Fastly, Inc. (4)

 

Internet Consumer & Business Services

 

Warrant

 

Common Stock

 

 

76,098

 

 

 

71

 

 

 

617

 

First Insight, Inc. (15)

 

Internet Consumer & Business Services

 

Warrant

 

Preferred Series B

 

 

75,917

 

 

 

96

 

 

 

116

 

Intent (p.k.a. Intent Media, Inc.)

 

Internet Consumer & Business Services

 

Warrant

 

Common Stock

 

 

140,077

 

 

 

168

 

 

 

114

 

Interactions Corporation

 

Internet Consumer & Business Services

 

Warrant

 

Preferred Series G-3

 

 

68,187

 

 

 

204

 

 

 

437

 

Just Fabulous, Inc.

 

Internet Consumer & Business Services

 

Warrant

 

Preferred Series B

 

 

206,184

 

 

 

1,102

 

 

 

2,458

 

Lendio, Inc.

 

Internet Consumer & Business Services

 

Warrant

 

Preferred Series D

 

 

127,032

 

 

 

39

 

 

 

57

 

Lightspeed POS, Inc. (4)(5)(10)

 

Internet Consumer & Business Services

 

Warrant

 

Common Stock

 

 

61,402

 

 

 

20

 

 

 

1,095

 

LogicSource

 

Internet Consumer & Business Services

 

Warrant

 

Preferred Series C

 

 

79,625

 

 

 

30

 

 

 

84

 

Oportun

 

Internet Consumer & Business Services

 

Warrant

 

Preferred Series G

 

 

174,562

 

 

 

78

 

 

 

574

 

Postmates, Inc.

 

Internet Consumer & Business Services

 

Warrant

 

Common Stock

 

 

189,865

 

 

 

317

 

 

 

153

 

RumbleON, Inc. (4)

 

Internet Consumer & Business Services

 

Warrant

 

Common Stock

 

 

102,768

 

 

 

87

 

 

 

35

 

SeatGeek, Inc.

 

Internet Consumer & Business Services

 

Warrant

 

Common Stock

 

 

137,976

 

 

 

662

 

 

 

682

 

ShareThis, Inc.

 

Internet Consumer & Business Services

 

Warrant

 

Preferred Series C

 

 

493,502

 

 

 

547

 

 

 

 

Snagajob.com, Inc.

 

Internet Consumer & Business Services

 

Warrant

 

Preferred Series A

 

 

1,800,000

 

 

 

782

 

 

 

108

 

 

 

Internet Consumer & Business Services

 

Warrant

 

Preferred Series B

 

 

1,211,537

 

 

 

62

 

 

 

43

 

TotalSnagajob.com, Inc.

 

 

 

 

 

 

 

 

3,011,537

 

 

 

844

 

 

 

151

 

Tapjoy, Inc.

 

Internet Consumer & Business Services

 

Warrant

 

Preferred Series D

 

 

748,670

 

 

 

316

 

 

 

3

 

The Faction Group LLC

 

Internet Consumer & Business Services

 

Warrant

 

Preferred Series AA

 

 

8,076

 

 

 

234

 

 

 

342

 

Thumbtack, Inc.

 

Internet Consumer & Business Services

 

Warrant

 

Common Stock

 

 

102,821

 

 

 

124

 

 

 

492

 

Xometry, Inc.

 

Internet Consumer & Business Services

 

Warrant

 

Preferred Series B

 

 

87,784

 

 

 

47

 

 

 

260

 

Subtotal: Internet Consumer & Business Services (0.70%)*

 

 

 

 

 

 

5,741

 

 

 

7,727

 

Media/Content/Info

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Machine Zone, Inc.

 

Media/Content/Info

 

Warrant

 

Common Stock

 

 

1,552,710

 

 

 

1,960

 

 

 

2,000

 

Napster

 

Media/Content/Info

 

Warrant

 

Common Stock

 

 

715,755

 

 

 

383

 

 

 

 

WP Technology, Inc. (Wattpad, Inc.) (5)(10)

 

Media/Content/Info

 

Warrant

 

Common Stock

 

 

255,818

 

 

 

4

 

 

 

2

 

Zoom Media Group, Inc.

 

Media/Content/Info

 

Warrant

 

Preferred Series A

 

 

1,204

 

 

 

347

 

 

 

 

Subtotal: Media/Content/Info (0.18%)*

 

 

 

 

 

 

2,694

 

 

 

2,002

 

Medical Devices & Equipment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Aspire Bariatrics, Inc. (15)

 

Medical Devices & Equipment

 

Warrant

 

Preferred Series B-1

 

 

112,858

 

 

 

455

 

 

 

 

Avedro, Inc. (4)(15)

 

Medical Devices & Equipment

 

Warrant

 

Common Stock

 

 

67,415

 

 

 

401

 

 

 

774

 

Flowonix Medical Incorporated

 

Medical Devices & Equipment

 

Warrant

 

Preferred Series AA

 

 

155,325

 

 

 

362

 

 

 

 

 

 

Medical Devices & Equipment

 

Warrant

 

Preferred Series BB

 

 

725,806

 

 

 

351

 

 

 

 

Total Flowonix Medical Incorporated

 

 

 

 

 

 

 

 

881,131

 

 

 

713

 

 

 

 

Gelesis, Inc.

 

Medical Devices & Equipment

 

Warrant

 

Preferred Series A-1

 

 

74,784

 

 

 

78

 

 

 

229

 

InspireMD, Inc. (4)(5)(10)

 

Medical Devices & Equipment

 

Warrant

 

Common Stock

 

 

1,105

 

 

 

 

 

 

 

Intuity Medical, Inc. (15)

 

Medical Devices & Equipment

 

Warrant

 

Preferred Series 5

 

 

1,819,078

 

 

 

294

 

 

 

301

 

Medrobotics Corporation (15)

 

Medical Devices & Equipment

 

Warrant

 

Preferred Series E

 

 

455,539

 

 

 

370

 

 

 

 

Micell Technologies, Inc.

 

Medical Devices & Equipment

 

Warrant

 

Preferred Series D-2

 

 

84,955

 

 

 

262

 

 

 

 

NinePoint Medical, Inc.

 

Medical Devices & Equipment

 

Warrant

 

Preferred Series A-1

 

 

587,840

 

 

 

170

 

 

 

28

 

Optiscan Biomedical, Corp. (6)

 

Medical Devices & Equipment

 

Warrant

 

Preferred Series E

 

 

74,424

 

 

 

572

 

 

 

250

 

See notes to consolidated financial statements

18


HERCULES CAPITAL, INC.

CONSOLIDATED SCHEDULE OF INVESTMENTS

June 30, 2019

(unaudited)

(dollars in thousands)

 

 

Portfolio Company

 

Sub-Industry

 

Type of

Investment (1)

 

Series

 

Shares

 

 

Cost (3)

 

 

Value (4)

 

Outset Medical, Inc.

 

Medical Devices & Equipment

 

Warrant

 

Preferred Series A

 

 

500,000

 

 

$

402

 

 

$

282

 

Quanterix Corporation (4)

 

Medical Devices & Equipment

 

Warrant

 

Common Stock

 

 

66,039

 

 

 

204

 

 

 

1,144

 

Sebacia, Inc.

 

Medical Devices & Equipment

 

Warrant

 

Preferred Series D

 

 

778,301

 

 

 

133

 

 

 

42

 

SonaCare Medical, LLC

 

Medical Devices & Equipment

 

Warrant

 

Preferred Series A

 

 

6,464

 

 

 

188

 

 

 

 

Tela Bio, Inc.

 

Medical Devices & Equipment

 

Warrant

 

Preferred Series B

 

 

387,930

 

 

 

61

 

 

 

34

 

ViewRay, Inc. (4)(15)

 

Medical Devices & Equipment

 

Warrant

 

Common Stock

 

 

128,231

 

 

 

333

 

 

 

351

 

Subtotal: Medical Devices & Equipment (0.31%)*

 

 

 

 

 

 

4,636

 

 

 

3,435

 

Semiconductors

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Achronix Semiconductor Corporation

 

Semiconductors

 

Warrant

 

Preferred Series C

 

 

360,000

 

 

 

160

 

 

 

88

 

 

 

Semiconductors

 

Warrant

 

Preferred Series D-2

 

 

750,000

 

 

 

99

 

 

 

366

 

Total Achronix Semiconductor Corporation

 

 

 

 

 

 

 

 

1,110,000

 

 

 

259

 

 

 

454

 

Elenion Technologies Corporation

 

Semiconductors

 

Warrant

 

Preferred Series C

 

 

225

 

 

 

8

 

 

 

6

 

Subtotal: Semiconductors (0.04%)*

 

 

 

 

 

 

267

 

 

 

460

 

Software

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Actifio, Inc.

 

Software

 

Warrant

 

Common Stock

 

 

73,584

 

 

 

249

 

 

 

53

 

 

 

Software

 

Warrant

 

Preferred Series F

 

 

31,673

 

 

 

343

 

 

 

64

 

Total Actifio, Inc.

 

 

 

 

 

 

 

 

105,257

 

 

 

592

 

 

 

117

 

CareCloud Corporation (15)

 

Software

 

Warrant

 

Preferred Series B

 

 

413,433

 

 

 

257

 

 

 

25

 

Clickfox, Inc. (15)

 

Software

 

Warrant

 

Preferred Series B

 

 

539,818

 

 

 

167

 

 

 

1

 

 

 

Software

 

Warrant

 

Preferred Series C

 

 

592,019

 

 

 

730

 

 

 

1

 

 

 

Software

 

Warrant

 

Preferred Series C-A

 

 

2,218,214

 

 

 

231

 

 

 

20

 

Total Clickfox, Inc.

 

 

 

 

 

 

 

 

3,350,051

 

 

 

1,128

 

 

 

22

 

Cloudian, Inc.

 

Software

 

Warrant

 

Common Stock

 

 

477,454

 

 

 

72

 

 

 

61

 

Couchbase, Inc.

 

Software

 

Warrant

 

Common Stock

 

 

188,127

 

 

 

344

 

 

 

153

 

Dashlane, Inc.

 

Software

 

Warrant

 

Common Stock

 

 

239,852

 

 

 

219

 

 

 

481

 

DNAnexus, Inc.

 

Software

 

Warrant

 

Preferred Series C

 

 

909,091

 

 

 

97

 

 

 

117

 

Evernote Corporation

 

Software

 

Warrant

 

Common Stock

 

 

62,500

 

 

 

106

 

 

 

95

 

Fuze, Inc. (15)

 

Software

 

Warrant

 

Preferred Series F

 

 

256,158

 

 

 

89

 

 

 

 

Lastline, Inc.

 

Software

 

Warrant

 

Common Stock

 

 

363,636

 

 

 

133

 

 

 

137

 

Lightbend, Inc. (15)

 

Software

 

Warrant

 

Preferred Series C-1

 

 

854,787

 

 

 

130

 

 

 

50

 

Message Systems, Inc. (15)

 

Software

 

Warrant

 

Preferred Series C

 

 

503,718

 

 

 

334

 

 

 

825

 

Nuvolo Technologies Corporation

 

Software

 

Warrant

 

Common Stock

 

 

30,000

 

 

 

43

 

 

 

93

 

OneLogin, Inc. (15)

 

Software

 

Warrant

 

Common Stock

 

 

381,620

 

 

 

305

 

 

 

700

 

Poplicus, Inc.

 

Software

 

Warrant

 

Common Stock

 

 

132,168

 

 

 

 

 

 

 

Quid, Inc. (15)

 

Software

 

Warrant

 

Preferred Series D

 

 

71,576

 

 

 

1

 

 

 

1

 

 

 

Software

 

Warrant

 

Preferred Series E

 

 

40,261

 

 

 

1

 

 

 

 

Total Quid, Inc.

 

 

 

 

 

 

 

 

111,837

 

 

 

2

 

 

 

1

 

RapidMiner, Inc.

 

Software

 

Warrant

 

Preferred Series C-1

 

 

4,982

 

 

 

24

 

 

 

6

 

RedSeal Inc. (15)

 

Software

 

Warrant

 

Preferred Series C-Prime

 

 

640,603

 

 

 

66

 

 

 

14

 

Signpost, Inc.

 

Software

 

Warrant

 

Preferred Series C

 

 

324,005

 

 

 

314

 

 

 

31

 

ZeroFox, Inc.

 

Software

 

Warrant

 

Preferred Series C-1

 

 

486,263

 

 

 

57

 

 

 

61

 

Subtotal: Software (0.27%)*

 

 

 

 

 

 

4,312

 

 

 

2,989

 

Specialty Pharmaceuticals

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Alimera Sciences, Inc. (4)

 

Specialty Pharmaceuticals

 

Warrant

 

Common Stock

 

 

1,717,709

 

 

 

861

 

 

 

76

 

Subtotal: Specialty Pharmaceuticals (0.01%)*

 

 

 

 

 

 

861

 

 

 

76

 

Surgical Devices

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gynesonics, Inc. (15)

 

Surgical Devices

 

Warrant

 

Preferred Series C

 

 

180,480

 

 

 

74

 

 

 

4

 

 

 

Surgical Devices

 

Warrant

 

Preferred Series D

 

 

1,575,965

 

 

 

321

 

 

 

20

 

Total Gynesonics, Inc.

 

 

 

 

 

 

 

 

1,756,445

 

 

 

395

 

 

 

24

 

TransMedics Group, Inc. (p.k.a Transmedics, Inc.) (4)

 

Surgical Devices

 

Warrant

 

Common Stock

 

 

64,441

 

 

 

138

 

 

 

898

 

Subtotal: Surgical Devices (0.08%)*

 

 

 

 

 

 

533

 

 

 

922

 

Sustainable and Renewable Technology

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Agrivida, Inc.

 

Sustainable and Renewable Technology

 

Warrant

 

Preferred Series D

 

 

471,327

 

 

 

120

 

 

 

 

Calera, Inc.

 

Sustainable and Renewable Technology

 

Warrant

 

Preferred Series C

 

 

44,529

 

 

 

513

 

 

 

 

Fluidic, Inc.

 

Sustainable and Renewable Technology

 

Warrant

 

Preferred Series D

 

 

61,804

 

 

 

102

 

 

 

 

Fulcrum Bioenergy, Inc.

 

Sustainable and Renewable Technology

 

Warrant

 

Preferred Series C-1

 

 

280,897

 

 

 

275

 

 

 

443

 

See notes to consolidated financial statements

19


HERCULES CAPITAL, INC.

CONSOLIDATED SCHEDULE OF INVESTMENTS

June 30, 2019

(unaudited)

(dollars in thousands)

 

 

Portfolio Company

 

Sub-Industry

 

Type of

Investment (1)

 

Series

 

Shares

 

 

Cost (3)

 

 

Value (4)

 

GreatPoint Energy, Inc. (15)

 

Sustainable and Renewable Technology

 

Warrant

 

Preferred Series D-1

 

 

393,212

 

 

$

548

 

 

$

 

Kinestral Technologies, Inc.

 

Sustainable and Renewable Technology

 

Warrant

 

Preferred Series A

 

 

325,000

 

 

 

155

 

 

 

161

 

 

 

Sustainable and Renewable Technology

 

Warrant

 

Preferred Series B

 

 

131,883

 

 

 

63

 

 

 

52

 

Total Kinestral Technologies, Inc.

 

 

 

 

 

 

 

 

456,883

 

 

 

218

 

 

 

213

 

Polyera Corporation (15)

 

Sustainable and Renewable Technology

 

Warrant

 

Preferred Series C

 

 

311,609

 

 

 

338

 

 

 

 

Proterra, Inc.

 

Sustainable and Renewable Technology

 

Warrant

 

Preferred Series 4

 

 

477,517

 

 

 

41

 

 

 

44

 

 

 

Sustainable and Renewable Technology

 

Warrant

 

Common Stock

 

 

36,630

 

 

 

1

 

 

 

1

 

Total Proterra, Inc.

 

 

 

 

 

 

 

 

514,147

 

 

 

42

 

 

 

45

 

Rive Technology, Inc. (15)

 

Sustainable and Renewable Technology

 

Warrant

 

Preferred Series E

 

 

234,477

 

 

 

13

 

 

 

 

Solar Spectrum Holdings LLC (p.k.a. Sungevity, Inc.) (6)

 

Sustainable and Renewable Technology

 

Warrant

 

Common Stock

 

 

0.69

 

 

 

 

 

 

 

TAS Energy, Inc.

 

Sustainable and Renewable Technology

 

Warrant

 

Preferred Series AA

 

 

428,571

 

 

 

299

 

 

 

 

Subtotal: Sustainable and Renewable Technology (0.06%)*

 

 

 

 

 

 

2,468

 

 

 

701

 

Total: Warrant Investments (2.31%)*

 

 

 

 

 

 

 

 

 

 

 

 

34,878

 

 

 

25,504

 

Total Investments in Securities (203.86%)*

 

 

 

 

 

 

 

 

 

 

 

$

2,315,662

 

 

$

2,251,999

 

 

*

Value as a percent of net assets

(1)

Preferred and common stock, warrants, and equity interests are generally non-income producing.

(2)

Interest rate PRIME represents 5.50% at June 30, 2019. 1-month LIBOR, 3-month LIBOR and 12-month LIBOR represent 2.40%, 2.40% and 2.28%, respectively, at June 30, 2019.

(3)

Gross unrealized appreciation, gross unrealized depreciation, and net unrealized depreciation for federal income tax purposes totaled $80.4 million, $159.2 million and $78.8 million, respectively. The tax cost of investments is $2.3 billion.

(4)

Except for warrants in 39 publicly traded companies and common stock in 24 publicly traded companies, all investments are restricted at June 30, 2019 and were valued at fair value using Level 3 significant unobservable inputs as determined in good faith by the Company’s board of directors (the “Board of Directors”). No unrestricted securities of the same issuer are outstanding. The Company uses the Standard Industrial Code for classifying the industry grouping of its portfolio companies.

(5)

Non-U.S. company or the company’s principal place of business is outside the United States.

(6)

Affiliate investment as defined under the Investment Company Act of 1940, as amended, (the “1940 Act”) in which Hercules owns at least 5% but generally less than 25% of the company’s voting securities.

(7)

Control investment as defined under the 1940 Act in which Hercules owns at least 25% of the company’s voting securities or has greater than 50% representation on its board.

(8)

Debt is on non-accrual status at June 30, 2019, and is therefore considered non-income producing. Note that at June 30, 2019, only the $10.7 million PIK, or payment-in-kind, loan is on non-accrual for the Company’s debt investment in Tectura Corporation. At June 30, 2019, only the $1.6 million and $683,000 loans are on non-accrual for the Company’s debt investment in Solar Spectrum Holdings LLC (p.k.a. Sungevity, Inc.).

(9)

Denotes that all or a portion of the debt investment is convertible debt.

(10)

Indicates assets that the Company deems not “qualifying assets” under section 55(a) of 1940 Act. Qualifying assets must represent at least 70% of the Company’s total assets at the time of acquisition of any additional non-qualifying assets.

(11)

Denotes that all or a portion of the debt investment secures the notes offered in the Debt Securitization (as defined in Note 4).

(12)

Denotes that all or a portion of the debt investment is pledged as collateral under the Wells Facility (as defined in Note 4).

(13)

Denotes that all or a portion of the debt investment is pledged as collateral under the Union Bank Facility (as defined in Note 4).

(14)

Denotes that all or a portion of the debt investment principal includes accumulated PIK interest and is net of repayments.

(15)

Denotes that all or a portion of the investment in this portfolio company is held by Hercules Technology III, L.P., or HT III, the Company’s wholly owned small business investment company, or SBIC, subsidiary.

(16)

Denotes that the fair value of the Company’s total investments in this portfolio company represent greater than 5% of the Company’s total assets at June 30, 2019.

(17)

Denotes that there is an unfunded contractual commitment available at the request of this portfolio company at June 30, 2019. Refer to Note 10.

(18)

Denotes unitranche debt with first lien “last-out” senior secured position and security interest in all assets of the portfolio company whereby the “last-out” portion will be subordinated to the “first-out” portion in a liquidation, sale or other disposition.

(19)

Denotes second lien senior secured debt.

 

 

 

See notes to consolidated financial statements

20


HERCULES CAPITAL, INC.

CONSOLIDATED SCHEDULE OF INVESTMENTS

December 31, 2018

(unaudited)

(dollars in thousands)

 

Portfolio Company

 

 

Sub-Industry

 

Type of

Investment(1)

 

Maturity Date

 

Interest Rate and Floor(2)

 

Principal Amount

 

 

Cost(3)

 

 

Value(4)

 

Debt Investments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Biotechnology Tools

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Under 1 Year Maturity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exicure, Inc. (11)

 

 

Biotechnology Tools

 

Senior Secured

 

September 2019

 

Interest rate PRIME + 6.45% or Floor rate of 9.95%, 3.85% Exit Fee

 

$

4,999

 

 

$

5,165

 

 

$

5,165

 

Subtotal: Under 1 Year Maturity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

5,165

 

 

 

5,165

 

Subtotal: Biotechnology Tools (0.54%)*

 

 

 

 

 

 

 

 

 

 

 

 

5,165

 

 

 

5,165

 

Consumer & Business Products

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1-5 Years Maturity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

WHOOP, INC. (12)

 

 

Consumer & Business Products

 

Senior Secured

 

July 2021

 

Interest rate PRIME + 3.75% or Floor rate of 8.50%, 6.95% Exit Fee

 

$

6,000

 

 

 

6,026

 

 

 

5,983

 

Subtotal: 1-5 Years Maturity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

6,026

 

 

 

5,983

 

Subtotal: Consumer & Business Products (0.63%)*

 

 

 

 

 

 

 

 

 

 

 

 

6,026

 

 

 

5,983

 

Diversified Financial Services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1-5 Years Maturity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gibraltar Business Capital, LLC. (7)

 

 

Diversified Financial Services

 

Unsecured

 

March 2023

 

Interest rate FIXED 14.50%

 

$

15,000

 

 

 

14,729

 

 

 

14,401

 

Subtotal: 1-5 Years Maturity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

14,729

 

 

 

14,401

 

Subtotal: Diversified Financial Services (1.51%)*

 

 

 

14,729

 

 

 

14,401

 

Drug Delivery

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1-5 Years Maturity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AcelRx Pharmaceuticals, Inc. (11)

 

 

Drug Delivery

 

Senior Secured

 

March 2020

 

Interest rate PRIME + 6.05% or Floor rate of 9.55%, 11.69% Exit Fee

 

$

10,936

 

 

 

11,926

 

 

 

11,842

 

Antares Pharma Inc. (10)(11)(15)

 

 

Drug Delivery

 

Senior Secured

 

July 2022

 

Interest rate PRIME + 4.50% or Floor rate of 9.25%, 4.25% Exit Fee

 

$

25,000

 

 

 

25,313

 

 

 

25,081

 

Subtotal: 1-5 Years Maturity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

37,239

 

 

 

36,923

 

Subtotal: Drug Delivery (3.86%)*

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

37,239

 

 

 

36,923

 

 

See notes to consolidated financial statements

 

21


 

 

HERCULES CAPITAL, INC.

CONSOLIDATED SCHEDULE OF INVESTMENTS

December 31, 2018

(unaudited)

(dollars in thousands)

 

Portfolio Company

 

 

Sub-Industry

 

Type of

Investment(1)

 

Maturity Date

 

Interest Rate and Floor(2)

 

Principal Amount

 

 

Cost(3)

 

 

Value(4)

 

Drug Discovery & Development

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Under 1 Year Maturity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Auris Medical Holding, AG (5)(10)

 

 

Drug Discovery & Development

 

Senior Secured

 

February 2019

 

Interest rate PRIME + 6.05% or Floor rate of 9.55%, 5.75% Exit Fee

 

$

757

 

 

$

1,471

 

 

$

1,471

 

Brickell Biotech, Inc. (12)

 

 

Drug Discovery & Development

 

Senior Secured

 

September 2019

 

Interest rate PRIME + 5.70% or Floor rate of 9.20%, 7.82% Exit Fee

 

$

4,808

 

 

 

5,281

 

 

 

5,281

 

Epirus Biopharmaceuticals, Inc. (8)

 

 

Drug Discovery & Development

 

Senior Secured

 

June 2019

 

Interest rate PRIME + 4.70% or Floor rate of 7.95%, 3.00% Exit Fee

 

$

2,203

 

 

 

2,487

 

 

 

 

Subtotal: Under 1 Year Maturity

 

 

 

 

 

 

 

 

 

 

 

 

9,239

 

 

 

6,752

 

1-5 Years Maturity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Acacia Pharma Inc. (10)(11)

 

 

Drug Discovery & Development

 

Senior Secured

 

January 2022

 

Interest rate PRIME + 4.50% or Floor rate of 9.25%, 3.95% Exit Fee

 

$

10,000

 

 

 

9,871

 

 

 

9,819

 

Aveo Pharmaceuticals, Inc. (11)

 

 

Drug Discovery & Development

 

Senior Secured

 

July 2021

 

Interest rate PRIME + 4.70% or Floor rate of 9.45%, 5.40% Exit Fee

 

$

10,000

 

 

 

10,111

 

 

 

10,042

 

 

 

 

Drug Discovery & Development

 

Senior Secured

 

July 2021

 

Interest rate PRIME + 4.70% or Floor rate of 9.45%, 3.00% Exit Fee

 

$

10,000

 

 

 

10,220

 

 

 

10,157

 

Total Aveo Pharmaceuticals, Inc.

 

 

 

 

 

 

 

$

20,000

 

 

 

20,331

 

 

 

20,199

 

Axovant Sciences Ltd. (5)(10)(11)(16)

 

 

Drug Discovery & Development

 

Senior Secured

 

March 2021

 

Interest rate PRIME + 6.80% or Floor rate of 10.55%

 

$

50,219

 

 

 

49,485

 

 

 

49,286

 

BridgeBio Pharma LLC (13)(16)

 

 

Drug Discovery & Development

 

Senior Secured

 

July 2022

 

Interest rate PRIME + 4.35% or Floor rate of 9.35%, 6.35% Exit Fee

 

$

35,000

 

 

 

35,054

 

 

 

35,263

 

 

 

 

Drug Discovery & Development

 

Senior Secured

 

July 2022

 

Interest rate PRIME + 3.35% or Floor rate of 9.10%, 5.75% Exit Fee

 

$

20,000

 

 

 

19,904

 

 

 

19,904

 

Total BridgeBio Pharma LLC

 

 

 

 

 

 

 

$

55,000

 

 

 

54,958

 

 

 

55,167

 

Chemocentryx, Inc. (10)(15)

 

 

Drug Discovery & Development

 

Senior Secured

 

December 2022

 

Interest rate PRIME + 3.30% or Floor rate of 8.05%, 6.25% Exit Fee

 

$

20,000

 

 

 

19,957

 

 

 

20,104

 

Genocea Biosciences, Inc. (11)

 

 

Drug Discovery & Development

 

Senior Secured

 

May 2021

 

Interest rate PRIME + 2.75% or Floor rate of 7.75%, 10.12% Exit Fee

 

$

14,000

 

 

 

14,937

 

 

 

14,788

 

Merrimack Pharmaceuticals, Inc. (12)

 

 

Drug Discovery & Development

 

Senior Secured

 

August 2021

 

Interest rate PRIME + 4.00% or Floor rate of 9.25%, 5.55% Exit Fee

 

$

15,000

 

 

 

15,024

 

 

 

15,024

 

Mesoblast (5)(10)(11)

 

 

Drug Discovery & Development

 

Senior Secured

 

March 2022

 

Interest rate PRIME + 4.95% or Floor rate of 9.45%, 6.95% Exit Fee

 

$

35,000

 

 

 

35,346

 

 

 

35,190

 

Metuchen Pharmaceuticals LLC (14)

 

 

Drug Discovery & Development

 

Senior Secured

 

October 2020

 

Interest rate PRIME + 7.25% or Floor rate of 10.75%, PIK Interest 1.35%, 2.25% Exit Fee

 

$

18,569

 

 

 

19,256

 

 

 

19,122

 

Motif BioSciences Inc. (5)(10)(11)(15)

 

 

Drug Discovery & Development

 

Senior Secured

 

September 2021

 

Interest rate PRIME + 5.50% or Floor rate of 10.00%, 2.15% Exit Fee

 

$

15,000

 

 

 

14,907

 

 

 

14,786

 

Myovant Sciences, Ltd. (5)(10)(11)

 

 

Drug Discovery & Development

 

Senior Secured

 

November 2021

 

Interest rate PRIME + 4.00% or Floor rate of 8.25%, 6.55% Exit Fee

 

$

40,000

 

 

 

40,320

 

 

 

40,151

 

 

See notes to consolidated financial statements

22


 

 

HERCULES CAPITAL, INC.

CONSOLIDATED SCHEDULE OF INVESTMENTS

December 31, 2018

(unaudited)

(dollars in thousands)

 

Portfolio Company

 

 

Sub-Industry

 

Type of

Investment(1)

 

Maturity Date

 

Interest Rate and Floor(2)

 

Principal Amount

 

 

Cost(3)

 

 

Value(4)

 

Nabriva Therapeutics (5)(10)

 

 

Drug Discovery & Development

 

Senior Secured

 

June 2023

 

Interest rate PRIME + 4.30% or Floor rate of 9.80%, 6.95% Exit Fee

 

$

25,000

 

 

$

24,750

 

 

$

24,750

 

Paratek Pharmaceuticals, Inc. (p.k.a. Transcept Pharmaceuticals, Inc.) (10)(11)(15)(16)

 

 

Drug Discovery & Development

 

Senior Secured

 

September 2020

 

Interest rate PRIME + 2.75% or Floor rate of 8.50%, 4.50% Exit Fee

 

$

40,000

 

 

 

40,882

 

 

 

40,472

 

 

 

 

Drug Discovery & Development

 

Senior Secured

 

September 2021

 

Interest rate PRIME + 2.75% or Floor rate of 8.50%, 4.50% Exit Fee

 

$

10,000

 

 

 

10,240

 

 

 

10,137

 

 

 

 

Drug Discovery & Development

 

Senior Secured

 

September 2021

 

Interest rate PRIME + 2.75% or Floor rate of 8.50%, 2.25% Exit Fee

 

$

10,000

 

 

 

10,084

 

 

 

9,925

 

 

 

 

Drug Discovery & Development

 

Senior Secured

 

August 2022

 

Interest rate PRIME + 2.10% or Floor rate of 7.85%, 6.95% Exit Fee

 

$

10,000

 

 

 

10,014

 

 

 

10,014

 

Total Paratek Pharmaceuticals, Inc. (p.k.a. Transcept Pharmaceuticals, Inc.)

 

$

70,000

 

 

 

71,220

 

 

 

70,548

 

Stealth Bio Therapeutics Corp. (5)(10)(11)

 

 

Drug Discovery & Development

 

Senior Secured

 

January 2021

 

Interest rate PRIME + 5.50% or Floor rate of 9.50%, 6.25% Exit Fee

 

$

19,313

 

 

 

19,740

 

 

 

19,597

 

Tricida, Inc. (11)(15)

 

 

Drug Discovery & Development

 

Senior Secured

 

March 2022

 

Interest rate PRIME + 3.35% or Floor rate of 8.85%, 8.19% Exit Fee

 

$

40,000

 

 

 

39,622

 

 

 

39,794

 

uniQure B.V. (5)(10)(11)

 

 

Drug Discovery & Development

 

Senior Secured

 

June 2023

 

Interest rate PRIME + 3.35% or Floor rate of 8.85%, 7.72% Exit Fee

 

$

35,000

 

 

 

35,538

 

 

 

35,386

 

Verastem, Inc. (11)

 

 

Drug Discovery & Development

 

Senior Secured

 

December 2020

 

Interest rate PRIME + 6.00%

or Floor rate of 10.50%, 4.50% Exit Fee

 

$

5,000

 

 

 

5,058

 

 

 

5,059

 

 

 

 

Drug Discovery & Development

 

Senior Secured

 

December 2020

 

Interest rate PRIME + 6.00%

or Floor rate of 10.50%, 4.50% Exit Fee

 

$

5,000

 

 

 

5,082

 

 

 

5,083

 

 

 

 

Drug Discovery & Development

 

Senior Secured

 

December 2020

 

Interest rate PRIME + 6.00% or Floor rate of 10.50%, 4.50% Exit Fee

 

$

5,000

 

 

 

5,057

 

 

 

5,057

 

 

 

 

Drug Discovery & Development

 

Senior Secured

 

December 2020

 

Interest rate PRIME + 6.00% or Floor rate of 10.50%, 4.50% Exit Fee

 

$

10,000

 

 

 

10,033

 

 

 

9,976

 

Total Verastem, Inc.

 

 

 

 

 

 

 

 

 

 

$

25,000

 

 

 

25,230

 

 

 

25,175

 

X4 Pharmaceuticals Inc.

 

 

Drug Discovery & Development

 

Senior Secured

 

November 2021

 

Interest rate PRIME + 4.25% or Floor rate of 9.50%, 7.95% Exit Fee

 

$

10,000

 

 

 

9,746

 

 

 

9,746

 

Subtotal: 1-5 Years Maturity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

520,238

 

 

 

518,632

 

Subtotal: Drug Discovery & Development (54.99%)*

 

 

 

 

 

 

529,477

 

 

 

525,384

 

 

See notes to consolidated financial statements

23


 

 

HERCULES CAPITAL, INC.

CONSOLIDATED SCHEDULE OF INVESTMENTS

December 31, 2018

(unaudited)

(dollars in thousands)

 

Portfolio Company

 

 

Sub-Industry

 

Type of

Investment(1)

 

Maturity Date

 

Interest Rate and Floor(2)

 

Principal

Amount

 

 

Cost(3)

 

 

Value(4)

 

Electronics & Computer Hardware

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1-5 Years Maturity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

908 DEVICES INC. (15)

 

 

Electronics & Computer Hardware

 

Senior Secured

 

September 2020

 

Interest rate PRIME + 4.00% or Floor rate of 8.25%, 4.25% Exit Fee

 

$

10,000

 

 

$

10,145

 

 

$

10,155

 

Glo AB (5)(10)(13)(14)

 

 

Electronics & Computer Hardware

 

Senior Secured

 

February 2021

 

Interest rate PRIME + 6.20% or Floor rate of 10.45%, PIK Interest 1.75%, 2.95% Exit Fee

 

$

12,192

 

 

 

12,265

 

 

 

5,556

 

Subtotal: 1-5 Years Maturity

 

 

  

 

 

22,410

 

  

15,711

 

Subtotal: Electronics & Computer Hardware (1.64%)*

 

  

 

 

22,410

 

 

15,711

Healthcare Services, Other

 

 

  

 

 

 

 

 

 

 

 

1-5 Years Maturity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Oak Street Health (12)

 

 

Healthcare Services, Other

 

Senior Secured

 

September 2021

 

Interest rate PRIME + 5.00% or Floor rate of 9.75%, 5.95% Exit Fee

 

$

30,000

 

 

 

30,486

 

 

 

30,338

 

PH Group Holdings (13)(17)

 

 

Healthcare Services, Other

 

Senior Secured

 

September 2020

 

Interest rate PRIME + 7.45% or Floor rate of 10.95%

 

$

20,000

 

 

 

19,889

 

 

 

19,806

 

 

 

 

Healthcare Services, Other

 

Senior Secured

 

September 2020

 

Interest rate PRIME + 7.45% or Floor rate of 10.95%

 

$

10,000

 

 

 

9,938

 

 

 

9,896

 

Total PH Group Holdings