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Hercules Capital Achieves More Than $880 Million in New Commitments in 2017(1)

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Company Continued Strong Organic Originations Momentum and Integrated
$127.5 Million of Selected Venture Assets Acquired from Ares Capital
Corp. in Q4 2017

Q4 2017 Achievements and Highlights

  • Q4 2017 closed new debt and equity commitments totaling ~$330.6
    million to 25 companies including 20 new and five (5) existing
    portfolio companies
    (1)
  • Unscheduled principal repayments, or "early loan pay-offs," of
    ~$124.2 million, for Q4 2017
  • Hercules portfolio company liquidity events in Q4 2017 include
    three (3) completed initial public offerings "IPOs" and two (2)
    completed or announced M&A events

Year-to-date ending December 31, 2017 Achievements and Highlights

  • Closed cumulative new debt and equity commitments of ~$882.0
    million, for full-year 2017
    (1)
  • Early loan pay-offs of ~$505.6 million, for full-year 2017
  • Ended 2017 with pending new commitments (signed non-binding term
    sheets) of ~$122.0 million as of January 8, 2018
    (2)

Q1 2018 Achievements and Highlights

  • Q1 2018 closed new debt and equity commitments of ~$45.0 million as
    of January 8, 2018

Hercules
Capital, Inc.
(NYSE:HTGC) ("Hercules" or the "Company"), the
leading specialty finance company to innovative venture growth, pre-IPO
and M&A stage companies backed by leading venture capital firms, today
announced its portfolio update for the fourth quarter and full-year 2017.

"We witnessed unprecedented activity in both new commitments and early
pay-offs during the fourth quarter and full year 2017," stated Manuel A.
Henriquez, founder, chairman and chief executive officer of Hercules.
"Our fourth quarter portfolio activity reflects a strong finish to
fiscal year 2017 with new closed commitments exceeding $330 million.
This achievement exemplifies our continued diligent deployment of
capital to new and existing companies, our continued access to the
leading venture capital-backed companies and our recent acquisition of
select venture debt investments recently acquired from Ares Capital.
Collectively, this puts Hercules Capital on pace to deliver $882 million
in new commitments for 2017 which surpasses 2016 by over eight percent
(8.0%). This more than offset the continued and unprecedented high level
of unanticipated early loan repayments throughout the year. Once again,
Hercules continues to demonstrate its unparalleled access to new deal
originations and our strong industry leadership position and brand
reputation within the venture lending marketplace."

New Debt and Equity Commitments for Q4 2017:

As of December 31, 2017, Hercules has originated ~$330.6 million of new
debt and equity commitments to 25 new and existing portfolio companies,
including 12 new portfolio company investments acquired from Ares
Capital.

20 new commitments to new innovative venture growth stage companies

Technology Portfolio – $62.0 Million

  • $20.0 million to a provider of digital media content targeting
    millennial women
  • $20.0 million to a leading platform for selling, distributing, and
    managing cloud-based products and services
  • $12.0 million to a leading provider of software for drafting,
    proofreading, comparing, repairing and cleaning documents in the legal
    and life sciences industries worldwide
  • $10.0 million to a data science software platform developer that
    provides an integrated environment for data preparation, machine
    learning, deep learning, text mining and predictive analytics

Life Sciences Portfolio – $115.0 Million

  • $40.0 million to a rapidly growing and innovative population health
    business operating primary care clinics focused on Medicare
    beneficiaries
  • $30.0 million to a medical device company that develops proprietary
    and innovative technologies that help eliminate a majority of the most
    common barriers to glucose testing
  • $25.0 million to a pharmaceutical company creating first-in-class
    orally available medicines for autoimmune diseases, inflammatory
    disorders and oncology
  • $20.0 million to a clinical stage biopharmaceutical company that
    develops and commercializes novel antibiotics for the treatment of
    serious and life-threatening infections caused by multi-drug bacteria

Acquired Portfolio Companies from Ares Capital
– $127.5 Million

  • $30.0 million to a technology company that provides an online digital
    marketplace designed to help millions of patients dramatically improve
    access to care
  • $25.0 million to a leading technology developer of a social analytics
    platform that global companies use to run brands, build businesses and
    connect with consumers
  • $20.0 million to a technology developer that provides a secure
    communications and collaboration platform that unites physicians,
    nurses, and other care team members, facilitating a timely interaction
    among them
  • $20.0 million to a developer of the largest working capital
    marketplace in the world in which companies across the globe use the
    technology to improve their financial position
  • $12.5 million to a network technology provider that operates as an
    enterprise-class Infrastructure-as-a-Service "IAAS" cloud service
    provider
  • $6.0 million to an industry-leading provider of clinical payment and
    communication technology solutions
  • $4.6 million to a developer of energy efficient glass for commercial,
    residential and automotive applications
  • $3.3 million to a provider of financial aid management software
    solutions for higher education institutions
  • $1.5 million to a developer of speech analytics software that enables
    enterprise customers to uncover actionable business intelligence in
    call center recordings
  • $1.3 million to a developer that creates proprietary analytics from
    big data in the public sector, giving businesses in every industry a
    distinct advantage when working with the government
  • $3.3 million in equity/warrant positions, including $1.9 million
    equity-only in two (2) portfolio companies

Five (5) New Commitments to Existing Portfolio
Companies – $26.1 Million

  • $12.9 million to a developer of email marketing technologies that
    offers a software that enables organizations to create, send and track
    email marketing campaigns and online surveys
  • $5.0 million to a biopharmaceutical company focused on discovering and
    developing drugs to improve outcomes for patients with cancer
  • $5.0 million to a leading provider of affordable and interoperable
    healthcare information technology solutions and services
  • $2.2 million to a leading developer of platforms for integrating,
    visualizing and analyzing information
  • $1.0 million to an online fantasy sports service that enables sports
    enthusiasts to play daily fantasy games and win cash prizes

Unscheduled Principal Repayments Or "Early Loan
Pay-Offs":

As of December 31, 2017, Hercules received ~$124.2 million in
unscheduled principal repayments "early loan pay-offs," nearly 25.0%
higher than initially anticipated.

Portfolio Company IPO, M&A and Other Activity in Q4 2017:

IPO Activities

  1. In December 2017, Hercules' Portfolio company Quanterix Corporation (NASDAQ: QTRX) completed its IPO and raised $73.7 million by offering more than
    4.9 million shares of common stock at $15.00 per share. Hercules held
    272,479 shares of Preferred Series D stock and warrants for 173,428
    and 38,828 shares of Preferred Series C and Preferred Series D stock,
    respectively, as of September 30, 2017, which represents an unrealized
    gain of approximately $1.2 million as of the closing price of $21.47
    for Quanterix on December 29, 2017.
  2. In November 2017, Hercules' portfolio company Aquantia Corporation (NYSE: AQ) raised approximately $61.3 million by offering 6.8 million shares
    of its common stock at $9.00 per share. Hercules held warrants for
    196,831 shares of Preferred Series G stock, as of September 30, 2017,
    which represents an unrealized gain of approximately $5,000.00 as of
    the closing price of $11.33 for Aquantia on December 29, 2017.
  3. In October 2017, Hercules' portfolio company ForeScout
    Technologies, Inc.
    (NASDAQ:FSCT) completed its IPO and raised
    approximately $117.0 million by offering 5.3 million shares of its
    common stock at $22.00 per share. Hercules held 319,099 and 80,587
    shares of Preferred Series D and Preferred Series E stock,
    respectively, as of September 30, 2017, which represents an unrealized
    gain of approximately $5.8 million as of the closing price of $31.89
    for ForeScout on December 29, 2017.

As of December 31, 2017, Hercules held warrant and equity positions in
two (2) portfolio companies that had filed Registration Statements
confidentially under the JOBS Act in contemplation of a potential IPO.

There can be no assurances that companies that have yet to complete
their IPOs will do so.

M&A Activities

  1. In August 2017, Hercules' portfolio companies Cempra, Inc.
    (NASDAQ:CEMP), a clinical-stage pharmaceutical company focused on
    developing differentiated anti-infectives for acute care and community
    settings to meet critical medical needs in the treatment of infectious
    diseases, and Melinta Therapeutics, Inc., a privately held
    company focused on discovering, developing, and commercializing novel
    antibiotics to treat serious bacterial infections, announced that the
    companies had entered into a definitive agreement under which Melinta
    will merge with a subsidiary of Cempra. The deal closed on November 6,
    2017. Melinta Therapeutics commenced trading on November 6, 2017 on
    the NASDAQ Global Market under the symbol "MLNT." Hercules committed
    $40.0 million in venture debt financing to Cempra from 2011 to 2014.
    Hercules initially committed $30.0 million in venture debt financing
    to Melinta in December 2014 and held 1,914,448 shares of Preferred
    Series 4 stock and warrants for 1,382,323 shares of Preferred Series 3
    stock as of September 30, 2017.
  2. In November 2017, Hercules' portfolio company Sonian Inc., a
    leading provider of public cloud archiving and business insights, was
    acquired by Barracuda Networks, Inc. (NYSE:CUDA), a leading provider
    of cloud-enabled security and data protection solutions. Terms of the
    transaction were not disclosed. Hercules initially committed $5.5
    million in venture debt financing in December 2013 and held warrants
    for 185,949 shares of Preferred Series C stock as of September 30,
    2017.

Portfolio Company Activities

  1. In December 2017, Hercules' portfolio company Revance Therapeutics,
    Inc.
    (NASDAQ:RVNC), a biotechnology company developing
    neuromodulators for use in treating aesthetic and underserved
    therapeutic conditions, announced positive top-line results from two
    pivotal Phase 3 studies, evaluating its next-generation
    neuromodulator, RT002 (daxibotulinumtoxin), for reducing wrinkles that
    lies between the brows (glabellar lines). Hercules held 22,765 shares
    of common stock as of September 30, 2017.
  2. In December 2017, Hercules' portfolio company Verastem, Inc.
    (NASDAQ:VSTM), a biopharmaceutical company focused on discovering and
    developing drugs to improve outcomes for patients with cancer,
    announced positive results from the Phase 3 DUO study which
    demonstrated duvelisib significantly improves progression of free
    survival in relapsed or refractory chronic lymphocytic leukemia and
    small lymphocytic lymphoma.
  3. In November 2017, Hercules' portfolio company Dynavax Technologies
    Corporation
    (NASDAQ:DVAX) announced that the U.S. Food and Drug
    Administration (FDA) had approved HEPLISAV-B for prevention of
    infection caused by all known subtypes of hepatitis B virus in adults
    age 18 years and older. HEPLISAV-B is the first new hepatitis B
    vaccine in the United States in more than 25 years and the only
    two-dose hepatitis B vaccine for adults. Hercules held 20,000 shares
    of common stock as of September 30, 2017.
  4. In October 2017, Hercules' portfolio company OptiScan Biomedical
    Corporation
    , a developer of innovative continuous monitoring
    systems for use in the surgical intensive care unit (SICU), announced
    that the US Food and Drug Administration (FDA) granted 510(k)
    clearance for the OptiScanner 5000 Glucose Monitoring System.
  5. In September 2017, Hercules' portfolio company Insmed Incorporated
    (NASDAQ:INSM), a global biopharmaceutical company focused on the
    unmet needs of patients with rare diseases, announced positive
    top-line results from Phase 3 CONVERT study of ALIS (Amikacin Liposome
    Inhalation Suspension) in adult patients with treatment-refractory
    Nontuberculous Mycobacterial (NTM) lung disease caused by
    Mycobacterium Avium Complex (AVM). Hercules held 70,771 shares of
    common stock as of September 30, 2017.

Accompanying Footnotes:

(1)     Includes venture debt portfolio assets purchased from Ares Capital
announced on November 2, 2017.
(2) Signed non-binding term sheets are subject to satisfactory
completion of Hercules' due diligence and final investment committee
approval process as well as negotiations of definitive documentation
with the prospective portfolio companies. These non-binding term
sheets generally convert to contractual commitments in approximately
90 days from signing. It is important to note that not all signed
non-binding term sheets are expected to close and do not necessarily
represent future cash requirements or investments.

About Hercules Capital, Inc.

Hercules Capital, Inc. (NYSE:HTGC) ("Hercules") is the leading and
largest specialty finance company focused on providing senior secured
venture growth loans to high-growth, innovative venture capital-backed
companies in a broad variety of technology, life sciences and
sustainable and renewable technology industries. Since inception
(December 2003), Hercules has committed more than $7.0 billion to over
390 companies and is the lender of choice for entrepreneurs and venture
capital firms seeking growth capital financing. Companies interested in
learning more about financing opportunities should contact info@htgc.com,
or call 650.289.3060.

Hercules' common stock trades on the New York Stock Exchange under the
ticker symbol "HTGC."

In addition, Hercules has three outstanding bond issuances of 6.25%
Unsecured Notes due July 2024 (NYSE:HTGX), 4.375% Convertible Senior
Notes due February 2022 and 4.625% Unsecured Investment Grade Notes due
October 2022.

Forward-Looking Statements

This press release may contain "forward-looking statements" within the
meaning of the Private Securities Litigation Reform Act of 1995. You
should understand that under Section 27A(b)(2)(B) of the Securities Act
of 1933, as amended, and Section 21E(b)(2)(B) of the Securities Exchange
Act of 1934, as amended, or the Exchange Act, the "safe harbor"
provisions of the Private Securities Litigation Reform Act of 1995 do
not apply to forward-looking statements made in periodic reports we file
under the Exchange Act.

The information disclosed in this press release is made as of the date
hereof and reflects Hercules most current assessment of its historical
financial performance. Actual financial results filed with the SEC may
differ from those contained herein due to timing delays between the date
of this release and confirmation of final audit results. These
forward-looking statements are not guarantees of future performance and
are subject to uncertainties and other factors that could cause actual
results to differ materially from those expressed in the forward-looking
statements including, without limitation, the risks, uncertainties,
including the uncertainties surrounding the current market volatility,
and other factors the Company identifies from time to time in its
filings with the SEC. Although Hercules believes that the assumptions on
which these forward-looking statements are based are reasonable, any of
those assumptions could prove to be inaccurate and, as a result, the
forward-looking statements based on those assumptions also could be
incorrect. You should not place undue reliance on these forward-looking
statements. The forward-looking statements contained in this release are
made as of the date hereof, and Hercules assumes no obligation to update
the forward-looking statements for subsequent events.

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