Hercules Capital, Inc. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Commitments and Contingencies (Tables)

Commitments and Contingencies (Tables)

6 Months Ended

Jun. 30, 2023

Schedule of Unfunded Contractual Commitments and Unencumbered Unfunded Commitments

As of June 30, 2023, and December 31, 2022, the Company’s unfunded contractual commitments available at the request of the portfolio company, including undrawn revolving facilities, and unencumbered by milestones were as follows:


(in thousands)	Unfunded Commitments (1) as of
Portfolio Company	June 30, 2023		December 31, 2022
Debt Investments:
Thumbtack, Inc.	$	40,000	$	40,000
Automation Anywhere, Inc.		29,400		29,400
Axsome Therapeutics, Inc.		25,375		21,000
Skydio, Inc.		22,500		22,500
SeatGeek, Inc.		19,375		—
Phathom Pharmaceuticals, Inc.		16,625		66,500
Carwow LTD		14,365		—
Dragos		13,000		—
Dronedeploy, Inc.		12,500		12,500
Iveric Bio, Inc.		12,375		—
PathAI, Inc.		12,000		12,000
Locus Robotics Corp.		10,740		—
Tipalti Solutions Ltd.		10,500		—
Alamar Biosciences, Inc.		10,000		10,000
Aryaka Networks, Inc.		10,000		20,000
Next Insurance, Inc.		10,000		—
Kura Oncology, Inc.		8,250		8,250
Tarsus Pharmaceuticals, Inc.		8,250		10,313
Elation Health, Inc.		7,500		7,500
Gritstone Bio, Inc.		7,500		7,500
TG Therapeutics, Inc.		6,500		—
Nuvolo Technologies Corporation		5,700		5,970
Akero Therapeutics, Inc.		5,000		5,000
Cutover, Inc.		4,150		1,000
Leapwork ApS		4,100		—
Saama Technologies, LLC		3,875		—
Riviera Partners LLC		3,500		3,500
Babel Street		3,375		3,375
Modern Life, Inc.		3,250		—
Signal Media Limited		3,000		5,250
Vida Health, Inc.		3,000		40,000
Zappi, Inc.		2,571		2,571
Brain Corporation		2,500		20,700
Yipit, LLC		2,250		2,250
Streamline Healthcare Solutions		2,200		—
Sumo Logic, Inc.		2,000		—
Ceros, Inc.		1,707		1,707
ThreatConnect, Inc.		1,600		1,600


(in thousands)	Unfunded Commitments (1) as of
Portfolio Company	June 30, 2023		December 31, 2022
Debt Investments:
RVShare, LLC	$	1,500	$	1,500
Loftware, Inc.		1,423		—
Dispatch Technologies, Inc.		1,250		1,250
3GTMS, LLC		1,222		—
LogicSource		1,209		1,209
Zimperium, Inc.		1,088		1,088
Ikon Science Limited		1,050		1,050
Omeda Holdings, LLC		919		938
Khoros (p.k.a Lithium Technologies)		906		1,812
Fortified Health Security		840		840
Agilence, Inc.		800		800
Flight Schedule Pro, LLC		639		639
Constructor.io Corporation		625		625
Enmark Systems, Inc.		457		457
Alchemer LLC		445		890
Cybermaxx Intermediate Holdings, Inc.		390		390
Annex Cloud		386		386
ShadowDragon, LLC		333		333
Cytracom Holdings LLC		72		225
Provention Bio, Inc.		—		40,000
Madrigal Pharmaceutical, Inc.		—		34,000
Oak Street Health, Inc.		—		33,750
HilleVax, Inc.		—		28,000
Replimune Group, Inc.		—		20,700
G1 Therapeutics, Inc.		—		19,375
Alladapt Immunotherapeutics Inc.		—		15,000
AppDirect, Inc.		—		15,000
Viridian Therapeutics, Inc.		—		12,000
Dashlane, Inc.		—		10,000
Fever Labs, Inc.		—		8,333
Fulfil Solutions, Inc.		—		5,000
Demandbase, Inc.		—		3,750
MacroFab, Inc.		—		3,000
Mobile Solutions Services		—		495
Total Unfunded Debt Commitments:		376,087		623,221

Investment Funds & Vehicles:(2)
Forbion Growth Opportunities Fund I C.V.		2,269		2,842
Forbion Growth Opportunities Fund II C.V.		2,748		2,811
Total Unfunded Commitments in Investment Funds & Vehicles:		5,017		5,653

Total Unfunded Commitments	$	381,104	$	628,874

(1)

For debt investments, amounts represent unfunded commitments, including undrawn revolving facilities, which are available at the request of the portfolio company. Amount excludes unfunded commitments which are unavailable due to the borrower having not met certain milestones. These amounts also exclude $127.9 million and $173.5 million of unfunded commitments as of June 30, 2023, and December 31, 2022, respectively, to portfolio companies related to loans assigned to or directly committed by the Adviser Funds as described in “Note -12 Related Party Transactions”.

(2)

For investment funds and vehicles, the amount represents uncalled capital commitments in private equity funds.

Schedule of Contractual Obligations

The following tables provide the Company’s contractual obligations as of June 30, 2023 and December 31, 2022:


As of June 30, 2023:	Payments due by period (in thousands)
Contractual Obligations (1)	Total		Less than 1 year		1 - 3 years		3 - 5 years		After 5 years
Debt (2)(3)	$	1,606,000	$	—	$	375,000	$	866,000	$	365,000
Lease and License Obligations (4)		27,493		2,922		6,617		6,223		11,731
Total	$	1,633,493	$	2,922	$	381,617	$	872,223	$	376,731

As of December 31, 2022:	Payments due by period (in thousands)
Contractual Obligations (1)	Total		Less than 1 year		1 - 3 years		3 - 5 years		After 5 years
Debt (5)(3)	$	1,594,000	$	—	$	382,000	$	847,000	$	365,000
Lease and License Obligations (4)		8,641		2,723		2,259		2,452		1,207
Total	$	1,602,641	$	2,723	$	384,259	$	849,452	$	366,207

(1)

Excludes commitments to extend credit to the Company’s portfolio companies and uncalled capital commitments in investment funds.

(2)

Includes $175.0 million in principal outstanding under the SBA Debentures, $105.0 million of the July 2024 Notes, $50.0 million of the February 2025 Notes, $70.0 million of the June 2025 Notes, $50.0 million of the June 2025 3-Year Notes, $50.0 million of the March 2026 A Notes, $50.0 million of the March 2026 B Notes, $150.0 million of the 2031 Asset-Backed Notes, $40.0 million of the 2033 Notes, $325.0 million of the September 2026 Notes and $350.0 million of the January 2027 Notes as of June 30, 2023. There was also $130.0 million outstanding under the SMBC Facility and $61.0 million outstanding under the MUFG Bank Facility as of June 30, 2023.

(3)

Amounts represent future principal repayments and not the carrying value of each liability. See “Note 5 – Debt”.

(4)

Facility leases and licenses including short-term leases.

(5)

Includes $175.0 million in principal outstanding under the SBA Debentures, $105.0 million of the July 2024 Notes, $50.0 million of the February 2025 Notes, $70.0 million of the June 2025 Notes, $50.0 million of the June 2025 3-Year Notes, $50.0 million of the March 2026 A Notes, $50.0 million of the March 2026 B Notes, $150.0 million of the 2031 Asset-Backed Notes, $40.0 million of the 2033 Notes, $325.0 million of the September 2026 Notes and $350.0 million of the January 2027 Notes as of December 31, 2022. There was also $72.0 million outstanding under the SMBC Facility and $107.0 million outstanding under the MUFG Bank Facility as of December 31, 2022.

Summary of Information Related to Measurement of Operating Lease Liabilities and Supplemental Cash Flow Information Related to Operating Leases

The following table sets forth information related to the measurement of the Company’s operating lease liabilities and supplemental cash flow information related to operating leases as of June 30, 2023, and 2022:


(in thousands)	Three Months Ended June 30, 2023		Three Months Ended June 30, 2022		Six Months Ended June 30, 2023		Six Months Ended June 30, 2022
Total operating lease cost	$	606	$	744	$	1,304	$	1,441
Cash paid for amounts included in the measurement of lease liabilities	$	1,127	$	1,175	$	1,736	$	1,769


	As of June 30, 2023			As of December 31, 2022
Weighted-average remaining lease term (in years)		8.62			5.48
Weighted-average discount rate		6.71	%		5.37	%

Schedule of Future Minimum Lease Payments under Operating Leases and Reconciliation to Operating Lease Liability

The following table shows future minimum lease payments under the Company’s operating leases and a reconciliation to the operating lease liability as of June 30, 2023:


(in thousands)	As of June 30, 2023
2023	$	1,042
2024		3,034
2025		3,288
2026		3,383
Thereafter		16,623
Total lease payments		27,370
Less: imputed interest & other items		(23,484	)
Total operating lease liability	$	3,886

Unfunded Debt Commitments

Other Commitments [Line Items]

Schedule of Unfunded Contractual Commitments and Unencumbered Unfunded Commitments

The following table provides additional information on the Company’s unencumbered unfunded commitments regarding milestones, expirations and type:


(in thousands)	June 30, 2023		December 31, 2022
Unfunded Debt Commitments:
Expiring during:
2023	$	187,230	$	461,296
2024		156,056		134,856
2025		1,294		720
2026		9,037		9,038
2027		15,152		15,171
2028		5,318		2,140
2030		2,000		—
Total Unfunded Debt Commitments		376,087		623,221

Unfunded Commitments in Investment Funds & Vehicles:
Expiring during:
2030		2,269		2,842
2032		2,748		2,811
Total Unfunded Commitments in Investment Funds & Vehicles		5,017		5,653
Total Unfunded Commitments	$	381,104	$	628,874