Quarterly report [Sections 13 or 15(d)]

Debt (Tables)

v3.26.3
Debt (Tables)
 9 Months Ended
Sep. 30, 2026
Debt Disclosure [Abstract]  
Schedule of Debt Information
As of September 30, 2026 and December 31, 2025, the Company had the following available and outstanding debt:
(in thousands) September 30, 2026 December 31, 2025
Total Available Principal
Outstanding
Carrying Value(1)
Total Available Principal
Outstanding
Carrying Value(1)
SBA Debentures(2)(4)
$ 425,000  $ 350,000  $ 341,889  $ 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  324,302 
January 2027 Notes 350,000  350,000  349,593  350,000  350,000  348,596 
2028 Convertible Notes 287,500  287,500  282,405  287,500  287,500  280,412 
February 2029 Notes 300,000  300,000  295,257  —  —  — 
June 2030 Notes 350,000  350,000  343,919  350,000  350,000  342,694 
2031 Asset-Backed Notes 49,660  49,660  49,660  64,636  64,636  64,530 
July 2031 Notes
 325,000  325,000  317,419  —  —  — 
2033 Notes 40,000  40,000  39,232  40,000  40,000  39,151 
MUFG Bank Facility(2)
440,000  241,000  241,000  440,000  168,000  168,000 
SMBC Facility(2)(3)(5)
475,000  290,219  290,096  475,000  277,934  277,780 
Total $ 3,042,160  $ 2,583,379  $ 2,550,470  $ 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 September 30, 2026 and December 31, 2025.
(4)As of September 30, 2026, the total available debt under the SBA Debentures was $425.0 million, of which $175.0 million was available to HC IV and $250.0 million was available to SBIC V, subject to compliance with certain conditions. As of 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. As of September 30, 2026, HC IV has issued the entire $175.0 million and SBIC V has issued $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 September 30, 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 and nine months ended September 30, 2026 and 2025 were as follows:
Three Months Ended September 30, Nine Months Ended September 30,
(in thousands) 2026 2025 2026 2025
Weighted average interest cost(1)
4.7  % 4.4  % 4.6  % 4.3  %
Weighted average cost of debt(2)
5.4  % 5.1  % 5.2  % 4.9  %
Weighted average debt outstanding
 $ 2,457,332  $ 2,128,248  $ 2,429,053  $ 2,029,422 
(1)Interest cost consists of contractual interest on borrowings.
(2)Cost of debt includes interest, amortization of debt issuance costs and discounts, and fees.
The Company held the following SBA debentures outstanding principal balances as of September 30, 2026 and December 31, 2025:
(in thousands)
Issuance/Pooling Date		 Maturity Date
Interest Rate(1)
September 30, 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 September 30, 2026 and December 31, 2025:
(in thousands) September 30, 2026 December 31, 2025
SBA Debentures $ 8,111  $ 8,988 
March 2026 A Notes —  16 
March 2026 B Notes —  17 
September 2026 Notes —  698 
January 2027 Notes 407  1,404 
2028 Convertible Notes 5,095  7,088 
February 2029 Notes 4,743  — 
June 2030 Notes 6,081  7,306 
2031 Asset-Backed Notes —  106 
July 2031 Notes
 7,581  — 
2033 Notes 768  849 
MUFG Bank Facility(1)
2,772  3,537 
SMBC Facility(1)(2)
1,604  2,214 
Total $ 37,162  $ 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 September 30, 2026, the debt issuance costs, net of accumulated amortization of the revolver facility is $1.5 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 and nine months ended September 30, 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 September 30, 2026 Nine Months Ended September 30, 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
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 $ 3,325  $ 295  $ —  $ 3,620  $ 6,651  $ 9,867  $ 876  $ —  $ 10,743  $ 12,993 
March 2026 A Notes —  —  —  —  —  393  16  —  409  1,125 
March 2026 B Notes —  —  —  —  —  398  17  —  415  1,138 
September 2026 Notes 1,836  172  —  2,008  4,266  6,185  578  —  6,763  8,531 
January 2027 Notes 3,079  207  —  3,286  5,906  9,236  621  —  9,857  11,813 
2028 Convertible Notes 3,724  354  —  4,078  6,828  11,174  1,062  —  12,236  13,656 
February 2029 Notes 4,148  316  —  4,464  8,025  10,627  809  —  11,436  8,025 
June 2030 Notes 5,381  216  —  5,597  —  16,263  654  —  16,917  10,500 
2031 Asset-Backed Notes(2)
623  —  —  623  624  2,221  71  —  2,292  2,209 
July 2031 Notes
 3,950  156  —  4,106  —  3,950  156  —  4,106  — 
2033 Notes 618  27  —  645  625  1,868  81  —  1,949  1,875 
MUFG Bank Facility 1,509  259  763  2,531  1,260  5,778  777  1,881  8,436  5,724 
SMBC Facility 1,691  203  347  2,241  1,266  8,200  609  790  9,599  7,930 
Total $ 29,884  $ 2,205  $ 1,110  $ 33,199  $ 35,451  $ 86,160  $ 6,327  $ 2,671  $ 95,158  $ 85,519 
(1)Interest expense includes amortization of OID for the three months ended September 30, 2026, of $35 thousand, $126 thousand, $311 thousand, $180 thousand, $189 thousand, and $139 thousand related to the September 2026 Notes, January 2027 Notes, 2028 Convertible Notes, February 2029 Notes, June 2030 Notes, and July 2031 Notes, respectively. Interest expense includes amortization of OID for the nine
months ended September 30, 2026, of $118 thousand, $377 thousand, $932 thousand, $461 thousand, $572 thousand, $33 thousand, and $139 thousand related to the September 2026 Notes, January 2027 Notes, 2028 Convertible Notes, February 2029 Notes, June 2030 Notes, 2031 Asset-Backed Notes, and July 2031 Notes, respectively.
(2)During the three and nine months ended September 30, 2026, the Company has recognized zero and $2 thousand, respectively, of loss on debt extinguishment for 2031 Asset-Backed Notes.
For the three and nine months ended September 30, 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 September 30, 2025 Nine Months Ended September 30, 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
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 $ 3,381  $ 295  $ —  $ 3,676  $ 5,892  $ 8,806  $ 785  $ —  $ 9,591  $ 9,863 
February 2025 Notes —  —  —  —  —  202  19  —  221  1,070 
June 2025 Notes —  —  —  —  —  1,274  81  —  1,355  1,508 
June 2025 3-Year Notes —  —  —  —  —  1,433  74  —  1,507  1,500 
March 2026 A Notes 562  23  —  585  1,125  1,687  71  —  1,758  2,250 
March 2026 B Notes 569  25  —  594  1,138  1,706  77  —  1,783  2,276 
September 2026 Notes 2,174  204  —  2,378  4,266  6,523  611  —  7,134  8,532 
January 2027 Notes 3,079  208  —  3,287  5,906  9,236  621  —  9,857  11,812 
2028 Convertible Notes 3,763  353  —  4,116  6,487  8,315  781  —  9,096  6,487 
June 2030 Notes 5,441  221  —  5,662  —  6,348  258  —  6,606  — 
2031 Asset-Backed Notes(2)
1,243  69  —  1,312  1,241  4,206  229  —  4,435  4,139 
2033 Notes 625  27  —  652  625  1,875  81  —  1,956  1,875 
MUFG Bank Facility 1,191  259  798  2,248  1,210  5,736  1,083  1,997  8,816  5,719 
SMBC Facility 2,161  203  319  2,683  1,897  9,470  614  767  10,851  9,764 
Total $ 24,189  $ 1,887  $ 1,117  $ 27,193  $ 29,787  $ 66,817  $ 5,385  $ 2,764  $ 74,966  $ 66,795 
(1)Interest expense includes amortization of OID for the three months ended September 30, 2025, of $42 thousand, $126 thousand, $311 thousand, $191 thousand, and $34 thousand related to the September 2026 Notes, January 2027 Notes, 2028 Convertible Notes, June 2030 Notes, and 2031 Asset-Backed Notes, respectively. Interest expense includes amortization of OID for the nine months ended September 30, 2025, of $125 thousand, $377 thousand, $690 thousand, $223 thousand, and $109 thousand related to the September 2026 Notes, January 2027 Notes, 2028 Convertible Notes, June 2030 Notes, and 2031 Asset-Backed Notes, respectively.
(2)During the three and nine months ended September 30, 2025, the Company has recognized $84 thousand and $120 thousand, respectively, 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 September 30, 2026 and December 31, 2025:
(in thousands) September 30, 2026 December 31, 2025
Investments at
Fair Value		 Percentage of
Total Portfolio		 Investments at
Fair Value		 Percentage of
Total Portfolio
Senior Secured Debt $ 4,568,831  94.3 % $ 4,209,798  94.2 %
Unsecured Debt 77,146  1.6 % 69,614  1.6 %
Preferred Stock 57,771  1.2 % 52,735  1.2 %
Common Stock 89,063  1.8 % 86,275  1.9 %
Warrants 46,290  1.0 % 41,162  0.9 %
Investment Funds & Vehicles 6,802  0.1 % 7,063  0.2 %
Total $ 4,845,903  100.0 % $ 4,466,647  100.0 %
A summary of the Company’s investment portfolio, at value, by geographic location as of September 30, 2026 and December 31, 2025 is shown as follows:
(in thousands) September 30, 2026 December 31, 2025
Investments at
Fair Value		 Percentage of
Total Portfolio		 Investments at
Fair Value		 Percentage of
Total Portfolio
United States $ 4,373,284  90.3 % $ 4,035,927  90.4 %
United Kingdom 131,959  2.7 % 118,031  2.7 %
Netherlands 114,239  2.4 % 117,344  2.6 %
Israel 68,634  1.4 % 67,280  1.5 %
Germany 58,410  1.2 % 50,386  1.1 %
Switzerland 48,514  1.0 % 35,504  0.8 %
Sweden 21,386  0.4 % 18,244  0.4 %
Canada 18,109  0.4 % 16,841  0.4 %
Ireland 10,901  0.2 % 4,729  0.1 %
Singapore —  0.0 % 1,827  0.0 %
Other(1)
467  0.0 % 534  0.0 %
Total $ 4,845,903  100.0 % $ 4,466,647  100.0  %
(1)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 September 30, 2026 and December 31, 2025:
(in thousands) September 30, 2026 December 31, 2025
Investments at
Fair Value		 Percentage of
Total Portfolio 		Investments at
Fair Value		 Percentage of
Total Portfolio
Application Software(1)
$ 1,124,669  23.2 % $ 1,045,146  23.4 %
Drug Discovery & Development 1,021,317  21.1 % 1,039,712  23.3 %
Healthcare Services, Other(1)
909,478  18.8 % 776,321  17.4 %
Consumer & Business Services(1)
367,226  7.6 % 441,467  9.9 %
Defense Technologies 312,021  6.4 % 140,458  3.1 %
Cybersecurity(1)
200,668  4.1 % 163,932  3.7 %
Healthcare Technology & Digital Health(1)
136,408  2.8 % 126,476  2.8 %
System Software(1)
121,824  2.5 % 308,613  6.9 %
Medical Devices & Equipment 118,674  2.5 % 77,257  1.7 %
Diversified Financial Services 112,078  2.3 % 105,896  2.4 %
Biotechnology Tools 79,433  1.6 % 23,164  0.5 %
Electronics & Computer Hardware 67,947  1.4 % 66,992  1.5 %
Space Technologies 61,742  1.3 % 47,816  1.1 %
Energy Technologies(1)
59,307  1.2 % 30,346  0.7 %
Consumer & Business Products 41,387  0.9 % 8,810  0.2 %
Manufacturing Technology 39,350  0.8 % 20,190  0.4 %
Communications & Networking 33,652  0.7 % 26,263  0.6 %
Financial Technologies(1)
26,576  0.5 % 8,971  0.2 %
Sustainable and Renewable Technology(1)
8,000  0.2 % 5,413  0.1 %
Information Services(1)
3,759  0.1 % 3,200  0.1 %
Semiconductors 329  0.0 % 158  0.0 %
Media/Content/Info 44  0.0 % 32  0.0 %
Drug Delivery 14  0.0 % 14  0.0 %
Total
 $ 4,845,903  100.0 % $ 4,466,647  100.0 %
(1)Effective September 30, 2026, the Company added the “Cybersecurity”, “Energy Technologies”, “Financial Technologies” and “Healthcare Technology & Digital Health” industry categories, which include investments previously classified within “Application Software”, “Consumer & Business Services”, “Healthcare Services, Other”, “Information Services”, “Sustainable and Renewable Technology” and “System Software”. Prior period amounts have been reclassified to conform to the current period presentation.
The following table summarizes information related to our SBICs as of September 30, 2026 and December 31, 2025.
September 30, 2026 December 31, 2025
Description HC IV SBIC V HC IV SBIC V
Number of investments held 37 39 39 28 
Fair value of investments (in millions) $ 402.2 $ 319.9 $ 404.8 $ 277.6 
Percentage of fair value of investments based on the Company's total investment portfolio 8.3  % 6.6  % 9.1  % 6.2  %
Tangible assets (in millions) $ 417.4 $ 324.5 $ 421.2 $ 283.1 
Percentage of tangible assets based on the Company's total assets 8.4  % 6.6  % 9.2  % 6.2  %