Related Party Transactions |
3 Months Ended |
|---|---|
Mar. 31, 2024 | |
| Related Party Transactions [Abstract] | |
| Related Party Transactions |
12. Related Party Transactions
As disclosed in “Note 1 - Description of Business”, the Adviser Subsidiary is the Company's wholly owned
registered investment advisor business, composed of the collectively held and presented entities Hercules Adviser LLC,
Hercules Capital Management, LLC, and Hercules Partner Holdings, LLC entities. The Adviser Subsidiary is accounted
for as a portfolio investment of the Company held at fair value. The Adviser Subsidiary has entered into investment
management agreements with its privately offered Adviser Funds, and it receives management fees based on the assets
under management of the Adviser Funds. In addition, the general partner interests (the “GP Interests”) held by Hercules Partner Holdings, LLC may receive incentive fees based on the performance of the Adviser Funds. Both the Adviser
Subsidiary and Hercules Partner Holdings, LLC are owned by Hercules Capital Management LLC. During the three months ended March 31, 2024, the Advisor Subsidiary declared and paid dividend distributions to the Company of $1.6 million. No dividend distributions were made during the three months ended March 31, 2023. Refer to “Note 4 – Investments” for information related to income, gains and losses recognized related to the Company’s investment.
The Company has a shared services agreement (“Sharing Agreement”) with the Adviser Subsidiary, through which the Adviser Subsidiary has access to the Company's human capital resources (including administrative functions) and other resources and infrastructure (including office space and technology). Under the terms of the Sharing Agreement, the Company allocates the related expenses of shared services to the Adviser Subsidiary based on direct time spent, investment activity, and proportion of assets under management depending on the nature of the expense. The Company’s total expenses for the three months ended March 31, 2024 and 2023, are net of expenses allocated to the Adviser Subsidiary of $2.9 million and $2.7 million, respectively. As of March 31, 2024 and December 31, 2023, there was $0.1 million and $0.1 million receivable, respectively, from the Adviser Subsidiary.
In addition, the Company may from time-to-time make investments alongside the Adviser Funds or assign a portion of investments to the Adviser Funds in accordance with the Company’s allocation policy. During the three months ended March 31, 2024, $181.1 million of all investment commitments of the Company and the Adviser Subsidiary were assigned
to or directly committed by the Adviser Funds. During the three months ended March 31, 2024, fundings of $113.4 million were assigned to, directly originated, or funded by the Adviser Funds. No amounts were received by the Company from the Adviser Funds relating to assigned investments during the three months ended March 31, 2024.
During the three months ended March 31, 2023, $174.7 million of all investment commitments of the Company and the Adviser Subsidiary were assigned to or directly committed by the Adviser Funds. During the three months ended March 31, 2023, fundings of $120.9 million were assigned to, directly originated, or funded by the Adviser Funds. The Company received $5.6 million from the Adviser Funds relating to the assigned investments during the three months ended March 31, 2023.
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