Quarterly report [Sections 13 or 15(d)]

Debt (Tables)

v3.26.1
Debt (Tables)
 3 Months Ended
Mar. 31, 2026
Debt Disclosure [Abstract]  
Schedule of Debt Information
As of March 31, 2026 and December 31, 2025, the Company had the following available and outstanding debt:
(in thousands) March 31, 2026 December 31, 2025
  Total Available Principal
Outstanding
Carrying Value(1)
Total Available Principal
Outstanding
Carrying Value(1)
SBA Debentures(2)(4)
$ 350,000  $ 350,000  $ 341,301  $ 350,000  $ 350,000  $ 341,012 
March 2026 A Notes —  —  —  50,000  50,000  49,984 
March 2026 B Notes —  —  —  50,000  50,000  49,983 
September 2026 Notes 325,000  325,000  324,548  325,000  325,000  324,302 
January 2027 Notes 350,000  350,000  348,928  350,000  350,000  348,596 
2028 Convertible Notes 287,500  287,500  281,076  287,500  287,500  280,412 
February 2029 Notes 300,000  300,000  294,267  —  —  — 
June 2030 Notes 350,000  350,000  343,104  350,000  350,000  342,694 
2031 Asset-Backed Notes 64,512  64,512  64,466  64,636  64,636  64,530 
2033 Notes 40,000  40,000  39,178  40,000  40,000  39,151 
MUFG Bank Facility(2)
440,000  220,000  220,000  440,000  168,000  168,000 
SMBC Facility(2)(3)(5)
475,000  282,307  282,164  475,000  277,934  277,780 
Total $ 2,982,012  $ 2,569,319  $ 2,539,032  $ 2,782,136  $ 2,313,070  $ 2,286,444 
(1)Except for the SMBC Facility and MUFG Bank Facility, all carrying values represent the principal amount outstanding less the remaining unamortized debt issuance costs and unaccreted premium or discount, if any, associated with the debt as of the balance sheet date.
(2)Availability subject to the Company meeting the borrowing base and/or capital commitment requirements.
(3)“Total Available” includes $175.0 million of available commitment through the letter of credit facility as of March 31, 2026 and December 31, 2025.
(4)As of March 31, 2026 and December 31, 2025, the total available debt under the SBA Debentures was $350.0 million, of which $175.0 million was available to HC IV and $175.0 million was available to SBIC V. HC IV and SBIC V have each issued the entire $175.0 million in SBIC Debentures.
(5)In November 2024, the Company amended its SMBC Facility and converted a portion of the existing revolver facility into a term loan facility in connection therewith. As of March 31, 2026, the term loan portion of the SMBC Facility for total available, outstanding principal, and carrying value was $25.0 million, $25.0 million, and $24.9 million respectively. As of December 31, 2025, the term loan portion of the SMBC Facility for total available, outstanding principal, and carrying value was $25.0 million, $25.0 million, and $24.8 million, respectively.
The overall weighted average interest cost, cost of debt and debt outstanding for the Company for the three months ended March 31, 2026 and 2025 were as follows:
Three Months Ended March 31,
(in thousands) 2026 2025
Weighted average interest cost
 4.5  % 4.3  %
Weighted average cost of debt(1)
5.1  % 4.9  %
Weighted average debt outstanding
 $ 2,420,380  $ 1,815,224 
(1)Cost of debt includes interest and fees.
The Company held the following SBA debentures outstanding principal balances as of March 31, 2026 and December 31, 2025:
(in thousands)
Issuance/Pooling Date		 Maturity Date
Interest Rate(1)
March 31, 2026 December 31, 2025
March 26, 2021 September 1, 2031 1.58% $ 37,500  $ 37,500 
June 25, 2021 September 1, 2031 1.58% 16,200  16,200 
July 28, 2021 September 1, 2031 1.58% 5,400  5,400 
August 20, 2021 September 1, 2031 1.58% 5,400  5,400 
October 21, 2021 March 1, 2032 3.21% 14,000  14,000 
November 1, 2021 March 1, 2032 3.21% 21,000  21,000 
November 15, 2021 March 1, 2032 3.21% 5,200  5,200 
November 30, 2021 March 1, 2032 3.21% 20,800  20,800 
December 20, 2021 March 1, 2032 3.21% 10,000  10,000 
December 23, 2021 March 1, 2032 3.21% 10,000  10,000 
December 28, 2021 March 1, 2032 3.21% 5,000  5,000 
January 14, 2022 March 1, 2032 3.21% 4,500  4,500 
January 21, 2022 March 1, 2032 3.21% 20,000  20,000 
November 8, 2024 March 1, 2035 5.09% 30,000  30,000 
December 6, 2024 March 1, 2035 5.09% 33,600  33,600 
December 12, 2024 March 1, 2035 5.09% 8,400  8,400 
December 20, 2024 March 1, 2035 5.09% 32,000  32,000 
February 5, 2025 March 1, 2035 5.09% 6,000  6,000 
March 28, 2025 September 1, 2035 4.66% 10,000  10,000 
April 25, 2025 September 1, 2035 4.66% 15,000  15,000 
May 9, 2025 September 1, 2035 4.66% 5,000  5,000 
June 5, 2025 September 1, 2035 4.66% 17,000  17,000 
June 12, 2025 September 1, 2035 4.66% 3,000  3,000 
June 25, 2025 September 1, 2035 4.66% 15,000  15,000 
Total SBA Debentures     $ 350,000  $ 350,000 
(1)     Interest rates are determined initially at issuance and reset to a fixed rate at the debentures pooling date. The rates are inclusive of annual SBA charges.
Schedule of Debt Issuance Costs, Net of Accumulated Amortization
Debt issuance costs, net of accumulated amortization, were as follows as of March 31, 2026 and December 31, 2025:
(in thousands) March 31, 2026 December 31, 2025
SBA Debentures $ 8,699  $ 8,988 
March 2026 A Notes —  16 
March 2026 B Notes —  17 
September 2026 Notes 452  698 
January 2027 Notes 1,072  1,404 
2028 Convertible Notes 6,424  7,088 
February 2029 Notes 5,733  — 
June 2030 Notes 6,896  7,306 
2031 Asset-Backed Notes 46  106 
2033 Notes 822  849 
MUFG Bank Facility(1)
3,278  3,537 
SMBC Facility(1)(2)
2,010  2,214 
Total $ 35,432  $ 32,223 
(1)The MUFG Bank Facility and SMBC Facility are line-of-credit arrangements, the debt issuance costs associated with these instruments are included within Other assets on the Consolidated Statements of Assets and Liabilities in accordance with ASC Subtopic 835-30.
(2)As part of the November 2024 amendment of the SMBC Facility, the existing revolver facility was split into a revolver facility and a term loan facility. As of March 31, 2026, the debt issuance costs, net of accumulated amortization of the revolver facility is $1.9 million and the term loan is $0.1 million. As of December 31, 2025, the debt issuance costs, net of accumulated amortization of the revolver facility is $2.0 million and the term loan is $0.2 million.
Schedule of Components of Interest Expense, Related Fees and Cash Paid for Interest Expense for Debt
For the three months ended March 31, 2026, the components of interest expense, related fees, losses on debt extinguishment and cash paid for interest expense for debt were as follows:
(in thousands) Three Months Ended March 31, 2026
Description
Interest expense(1)
Amortization of debt issuance cost (loan fees) Unused facility and other fees (loan fees) Total interest expense and fees Cash paid for interest expense
SBA Debentures $ 3,253  $ 289  $ —  $ 3,542  $ 6,343 
March 2026 A Notes 393  16  —  409  1,125 
March 2026 B Notes 398  17  —  415  1,138 
September 2026 Notes 2,175  203  —  2,378  4,266 
January 2027 Notes 3,079  207  —  3,286  5,906 
2028 Convertible Notes 3,725  354  —  4,079  6,828 
February 2029 Notes 2,284  174  —  2,458  — 
June 2030 Notes 5,441  219  —  5,660  — 
2031 Asset-Backed Notes(2)
818  42  —  860  799 
2033 Notes 625  27  —  652  625 
MUFG Bank Facility 2,663  259  455  3,377  2,316 
SMBC Facility 3,292  203  212  3,707  3,050 
Total $ 28,146  $ 2,010  $ 667  $ 30,823  $ 32,396 
(1)Interest expense includes amortization of OID for the three months ended March 31, 2026, of $42 thousand, $126 thousand, $311 thousand, $99 thousand, $191 thousand, and $19 thousand related to the September 2026 Notes, January 2027 Notes, 2028 Convertible Notes, February 2029 Notes, June 2030 Notes, and 2031 Asset-Backed Notes, respectively.
(2)During the three months ended March 31, 2026, we did not have any loss on debt extinguishment for 2031 Asset-Backed Notes.
For the three months ended March 31, 2025, the components of interest expense, related fees, losses on debt extinguishment and cash paid for interest expense for debt were as follows:
(in thousands) Three Months Ended March 31, 2025
Description
Interest expense(1)
Amortization of debt issuance cost (loan fees) Unused facility and other fees (loan fees) Total interest expense and fees Cash paid for interest expense
SBA Debentures $ 2,499  $ 227  $ —  $ 2,726  $ 3,971 
February 2025 Notes 202  19  —  221  1,070 
June 2025 Notes 754  40  —  794  — 
June 2025 3-Year Notes 750  39  —  789  — 
March 2026 A Notes 562  24  —  586  1,125 
March 2026 B Notes 568  26  —  594  1,138 
September 2026 Notes 2,175  203  —  2,378  4,266 
January 2027 Notes 3,079  207  —  3,286  5,906 
2028 Convertible Notes 827  77  —  904  — 
2031 Asset-Backed Notes(2)
1,492  80  —  1,572  1,457 
2033 Notes 625  27  —  652  625 
MUFG Bank Facility 2,570  442  560  3,572  2,179 
SMBC Facility 3,595  208  219  4,022  3,843 
Total $ 19,698  $ 1,619  $ 779  $ 22,096  $ 25,580 
(1)Interest expense includes amortization of OID for the three months ended March 31, 2025 of $42 thousand, $126 thousand, $68 thousand, and $38 thousand related to the September 2026 Notes, January 2027 Notes, 2028 Convertible Notes, and 2031 Asset-Backed Notes, respectively.
(2)During the three months ended March 31, 2025, the Company has recognized $15 thousand of loss on debt extinguishment for 2031 Asset-Backed Notes.
Schedule of SBIC Investments
The following table shows the fair value of the Company’s portfolio of investments by asset class as of March 31, 2026 and December 31, 2025:
(in thousands) March 31, 2026 December 31, 2025
Investments at
Fair Value		 Percentage of
Total Portfolio		 Investments at
Fair Value		 Percentage of
Total Portfolio
Senior Secured Debt $ 4,469,019  94.6 % $ 4,209,798  94.2 %
Unsecured Debt 71,126  1.5 % 69,614  1.6 %
Preferred Stock 53,449  1.1 % 52,735  1.2 %
Common Stock 78,659  1.7 % 86,275  1.9 %
Warrants 42,507  0.9 % 41,162  0.9 %
Investment Funds & Vehicles 7,227  0.2 % 7,063  0.2 %
Total $ 4,721,987  100.0 % $ 4,466,647  100.0 %
A summary of the Company’s investment portfolio, at value, by geographic location as of March 31, 2026 and December 31, 2025 is shown as follows:
(in thousands) March 31, 2026 December 31, 2025
Investments at
Fair Value		 Percentage of
Total Portfolio		 Investments at
Fair Value		 Percentage of
Total Portfolio
United States $ 4,249,172  90.0 % $ 4,035,927  90.4 %
United Kingdom 152,389  3.2 % 118,031  2.7 %
Netherlands 115,004  2.4 % 117,344  2.6 %
Israel 66,148  1.4 % 67,280  1.5 %
Germany 49,417  1.1 % 50,386  1.1 %
Switzerland 47,763  1.0 % 35,504  0.8 %
Canada 18,432  0.4 % 16,841  0.4 %
Sweden 18,395  0.4 % 18,244  0.4 %
Ireland 4,770  0.1 % 4,729  0.1 %
Singapore —  0.0 % 1,827  0.0 %
Other(1)
497  0.0 % 534  0.0 %
Total $ 4,721,987  100.0 % $ 4,466,647  100.0  %
(1)Effective March 31, 2026, the Company’s investment portfolio based in Denmark has been consolidated with “Other”. Prior year amounts have been reclassified to conform to the current presentation.
The following table shows the fair value of the Company’s portfolio by industry sector as of March 31, 2026 and December 31, 2025:
(in thousands) March 31, 2026 December 31, 2025
Investments at
Fair Value		 Percentage of
Total Portfolio 		Investments at
Fair Value		 Percentage of
Total Portfolio
Application Software $ 1,113,788  23.6 % $ 1,087,954  24.3 %
Drug Discovery & Development 1,089,920  23.1 % 1,039,712  23.3 %
Healthcare Services, Other 890,720  18.9 % 838,508  18.8 %
System Software 507,172  10.7 % 472,144  10.6 %
Consumer & Business Services 474,202  10.0 % 449,631  10.1 %
Defense Technologies 157,631  3.3 % 140,458  3.1 %
Diversified Financial Services 106,304  2.3 % 105,896  2.4 %
Medical Devices & Equipment 81,619  1.7 % 77,257  1.7 %
Electronics & Computer Hardware 66,735  1.4 % 66,992  1.5 %
Space Technologies 53,167  1.1 % 47,816  1.1 %
Consumer & Business Products 42,187  0.9 % 8,810  0.2 %
Sustainable and Renewable Technology 35,804  0.8 % 35,759  0.8 %
Communications & Networking 32,063  0.7 % 26,263  0.6 %
Information Services 25,634  0.6 % 25,889  0.6 %
Biotechnology Tools 24,060  0.5 % 23,164  0.5 %
Manufacturing Technology 20,753  0.4 % 20,190  0.4 %
Semiconductors 187  0.0 % 158  0.0 %
Media/Content/Info 31  0.0 % 32  0.0 %
Drug Delivery 10  0.0 % 14  0.0 %
Total $ 4,721,987  100.0 % $ 4,466,647  100.0 %
The following table summarizes information related to our SBICs as of March 31, 2026 and December 31, 2025.
March 31, 2026 December 31, 2025
Description HC IV SBIC V HC IV SBIC V
Number of investments held 39 31 39 28 
Fair value of investments (in millions) $ 386.7 $ 281.8 $ 404.8 $ 277.6 
Percentage of fair value of investments based on the Company's total investment portfolio 8.2  % 6.0  % 9.1  % 6.2  %
Tangible assets (in millions) $ 396.2 $ 285.2 $ 421.2 $ 283.1 
Percentage of tangible assets based on the Company's total assets 8.2  % 5.9  % 9.2  % 6.2  %