Hercules Capital Announces Supplemental Cash Distribution of $0.05 per Share for the Fourth Quarter of 2020

Rhea-AI Summary

Hercules Capital (NYSE: HTGC) has announced a supplemental cash distribution of $0.05 per share from its undistributed taxable income as of December 31, 2020. The record date for this distribution is March 8, 2021, with payment on March 15, 2021. This comes in addition to the regular quarterly cash distribution of $0.32 per share for Q4 2020. Hercules follows a variable distribution policy aimed at distributing between 90% to 100% of its taxable income per quarter. The percentage of Qualified Interest Income for 2020 distributions is 93.52%.

Positive

• Announced a supplemental cash distribution of $0.05 per share.
• Maintains a variable distribution policy aimed at distributing 90% to 100% of taxable income.
• Percentage of Qualified Interest Income for 2020 distributions is 93.52%.

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• None.

Hercules Capital, Inc. (NYSE: HTGC) (“Hercules” or the “Company”), the largest and leading specialty financing provider to innovative venture, growth and established stage companies backed by some of the leading and top-tier venture capital and select private equity firms, is pleased to announce that its Board of Directors has declared a supplemental cash distribution of $0.05 per share.

This supplemental cash distribution will be paid out of Hercules Capital’s undistributed taxable income (taxable income in excess of distributions paid) as of December 31, 2020. The following shows the key dates of the supplemental distribution payment:

						Record Date			March 8, 2021
						Payment Date			March 15, 2021

This supplemental cash distribution is in addition to the previously announced regular quarterly cash distribution that Hercules declared for the fourth quarter of 2020 of $0.32 per share.

Hercules' Board of Directors maintains a variable distribution policy with the objective of distributing four quarterly distributions in an amount that approximates 90% to 100% of the Company’s taxable quarterly income or potential annual income for a particular year. In addition, during the year, the Company’s Board of Directors may choose to pay additional supplemental distributions, so that the Company may distribute approximately all its annual taxable income in the year it was earned, or it can elect to maintain the option to spill over the excess taxable income into the coming year for future distribution payments.

The determination of the tax attributes of the Company's distributions is made annually as of the end of the Company's fiscal year based upon its taxable income for the full year and distributions paid for the full year. Therefore, a determination made on a quarterly basis may not be representative of the actual tax attributes of its distributions for a full year. Of the distributions declared during the quarter ended December 31, 2020, 100% were distributions derived from the Company’s current and accumulated earnings and profits. There can be no certainty to stockholders that this determination is representative of the tax attributes of the Company’s 2021 full year distributions to stockholders.

Pursuant to Internal Revenue Code Section 871(k), certain funds generate “Qualified Interest Income” (QII) that may be exempt for U.S. withholding tax on foreign accounts. A regulated investment company (“RIC”) is permitted to designated distributions of QII as exempt from U.S. withholding tax when paid to non-U.S. shareholders with proper documentation.

The percentage of QII for distributions declared for the fiscal year ended December 31, 2020 on Hercules Capital, Inc.’s common stock is 93.52%.

About Hercules Capital, Inc.

Hercules Capital, Inc. (NYSE: HTGC) 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 $11.0 billion to over 520 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 (NYSE) under ticker symbol HTGC. In addition, Hercules has two retail bond issuances of 5.25% Notes due 2025 (NYSE: HCXZ) and 6.25% Notes due 2033 (NYSE: HCXY).

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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FAQ

What is the supplemental cash distribution amount announced by Hercules Capital (HTGC)?

Hercules Capital announced a supplemental cash distribution of $0.05 per share.

When is the record and payment date for the supplemental distribution for HTGC?

The record date is March 8, 2021, and the payment date is March 15, 2021.

What was the regular quarterly cash distribution for Hercules Capital in Q4 2020?

The regular quarterly cash distribution for Q4 2020 was $0.32 per share.

What is the variable distribution policy of Hercules Capital (HTGC)?

Hercules Capital aims to distribute between 90% to 100% of its taxable income quarterly.

What percentage of Qualified Interest Income (QII) did Hercules Capital declare for 2020 distributions?

The percentage of Qualified Interest Income for 2020 distributions was 93.52%.