UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): December 17, 2015
Hercules Technology Growth Capital, Inc.
(Exact name of Registrant as specified in its charter)
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| Maryland |
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814-00702 |
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74-3113410 |
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of incorporation) |
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(Commission
File Number) |
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(I.R.S. Employer
Identification No.) |
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| 400 Hamilton Ave., Suite 310
Palo Alto, CA |
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94301 |
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(Zip Code) |
Registrant’s telephone number, including area code: (650) 289-3060
None
(Former name or
former address, if changed since last report)
Check the appropriate box below
if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
On December 17, 2015, Hercules Technology Growth Capital, Inc. issued a press
release announcing the estimated accretive impact to its investment loan portfolio attributed to the Federal Reserve – Federal Reserve Open Market Committee’s increase in the federal funds rate by 25 basis points,. The text of the press
release is included as an exhibit to this Form 8-K.
| Item 9.01 |
Financial Statements and Exhibits |
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| 99.1 |
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Press Release dated December 17, 2015. |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on
its behalf by the undersigned hereunto duly authorized.
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HERCULES TECHNOLOGY GROWTH CAPITAL, INC. |
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| Date: December 17, 2015 |
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By: |
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/s/ Manuel A. Henriquez |
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Chief Executive Officer |
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EXHIBIT INDEX
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| Exhibit No. |
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Description of Exhibits |
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| 99.1 |
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Press Release dated December 17, 2015 |
Exhibit 99.1
Hercules Well Positioned to Benefit from Rising Rates and Expects to Realize
Increased Net Investment Income from the Recent FOMC Rate Increase
• ~98.2% of Hercules Existing Loan Portfolio is Priced at Floating Interest Rates
• Prime Rate has increased from 3.25% to 3.50%, per the Wall Street Journal today
• Each 25 Basis Points Rise in the Prime Rate Generates Approximately $2.0 Million, or
$0.03 per Share of Additional Net Investment Income or NII
Palo Alto, Calif., December 17, 2015– Hercules Technology Growth Capital, Inc. (NYSE: HTGC)(“Hercules” or the
“Company”), the leading specialty financing provider to innovative venture growth stage companies backed by leading venture capital firms, today announced the estimated accretive impact to its investment loan portfolio attributed to the
Federal Reserve - Federal Open Market Committee’s (“FOMC”) increase in the federal funds rate by 25 basis points, or 0.25%. Hercules anticipates each 25 basis points increase in the Prime Rate will contribute approximately $2.0
million, or $0.03 per share, of net investment income per annum. As of September 30, 2015, 98.2% of Hercules’ loan investment portfolio of $1.1 billion was primarily priced at PRIME or LIBOR-based floating interest rates, while 100% of the
Company’s outstanding debt obligations have a fixed rate of interest, well positioned Hercules for additional future rate increases. The expected net investment income benefit is expected to be realized beginning in Q1 2016.
Based on Hercules’ Consolidated Statement of Assets and Liabilities as of September 30, 2015, the following table illustrates the approximate annualized
increase in components of net income resulting from hypothetical base rate changes in interest rates, such as prime rate, assuming no changes in the Company’s investments and borrowings.
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| (in thousands)
Basis Point Increase (1) |
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Interest
Income (2) |
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Interest
Expense |
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Net
Income |
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EPS(2) |
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| 25 |
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$ |
2,382.00 |
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$ |
370.00 |
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$ |
2,012.00 |
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$ |
0.03 |
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| 50 |
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$ |
4,764.00 |
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$ |
394.00 |
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$ |
4,370.00 |
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$ |
0.06 |
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| 75 |
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$ |
7,146.00 |
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$ |
418.00 |
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$ |
6,728.00 |
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$ |
0.10 |
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| 100 |
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$ |
9,528.00 |
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$ |
442.00 |
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$ |
9,086.00 |
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$ |
0.13 |
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| 200 |
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$ |
19,506.00 |
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$ |
538.00 |
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$ |
18,968.00 |
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$ |
0.28 |
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| 300 |
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$ |
30,278.00 |
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$ |
633.00 |
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$ |
29,645.00 |
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$ |
0.43 |
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| (1) |
A decline in interest rates would not have a material impact on our Consolidated Financial Statements. |
| (2) |
EPS calculated on basic weighted shares outstanding of 68,897. |
About Hercules Technology Growth Capital,
Inc.
Hercules Technology Growth Capital, Inc. (NYSE: HTGC) is the leading specialty finance company focused on providing senior secured venture growth
loans to high-growth, innovative venture capital-backed companies in the technology, biotechnology, life sciences, healthcare, and energy & renewable technology industries. Since inception (December 2003), Hercules has committed more than $5.6
billion to over 325 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 to the Notes which trade on the NYSE under the symbol “HTGY”, Hercules has two outstanding
bond issuances of 7.00% Senior Notes due April 2019 and 6.25% Notes due July 2024, which trade on the NYSE under the symbols “HTGZ,” and “HTGX,” respectively.
Forward-Looking Statements
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 Securities and Exchange Commission 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 Securities and Exchange Commission. 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.
Contact:
Michael Hara
Investor Relations and Corporate Communications
Hercules Technology Growth Capital, Inc.
(650) 433-5578
HT-HN
mhara@htgc.com
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