Hercules Capital Closes Offering of $287.5 Million of Convertible Unsecured Notes
Hercules Capital (NYSE: HTGC) has successfully closed a private offering of $287.5 million in 4.750% Convertible Unsecured Notes due 2028, including a fully exercised $37.5 million overallotment option. The notes, rated BBB+ by Kroll Bond Rating Agency, were exclusively sold to qualified institutional buyers.
The convertible notes feature a 4.750% annual interest rate paid semiannually and an initial conversion rate of 46.5631 shares per $1,000 principal, equivalent to a conversion price of $21.48 per share - a 12.5% premium over the March 5 closing price of $19.09. Upon conversion, Hercules can choose to settle in cash, common stock, or a combination thereof.
The proceeds will be used to fund investments in debt and equity securities aligned with the company's investment objective and for working capital purposes. The notes will mature on September 1, 2028, with no early redemption rights.
Hercules Capital (NYSE: HTGC) ha chiuso con successo un'offerta privata di 287,5 milioni di dollari in Obbligazioni Convertibili Non Garantite al 4,750% con scadenza nel 2028, inclusa un'opzione di sovrallocazione completamente esercitata di 37,5 milioni di dollari. Le obbligazioni, valutate BBB+ dall'Agenzia di Rating Kroll, sono state vendute esclusivamente a compratori istituzionali qualificati.
Le obbligazioni convertibili presentano un tasso d'interesse annuale del 4,750% pagato semestralmente e un tasso di conversione iniziale di 46,5631 azioni per ogni 1.000 dollari di capitale, equivalente a un prezzo di conversione di 21,48 dollari per azione - un premio del 12,5% rispetto al prezzo di chiusura del 5 marzo di 19,09 dollari. In caso di conversione, Hercules può scegliere di liquidare in contante, azioni ordinarie o una combinazione di entrambi.
I proventi saranno utilizzati per finanziare investimenti in titoli di debito e capitale in linea con l'obiettivo di investimento dell'azienda e per esigenze di capitale circolante. Le obbligazioni scadranno il 1 settembre 2028, senza diritti di rimborso anticipato.
Hercules Capital (NYSE: HTGC) ha cerrado con éxito una oferta privada de 287,5 millones de dólares en Notas Convertibles No Garantizadas al 4,750% con vencimiento en 2028, incluyendo una opción de sobreasignación completamente ejercida de 37,5 millones de dólares. Las notas, calificadas BBB+ por la Agencia de Calificación Kroll, se vendieron exclusivamente a compradores institucionales calificados.
Las notas convertibles cuentan con un tasa de interés anual del 4,750% pagada semestralmente y una tasa de conversión inicial de 46,5631 acciones por cada 1,000 dólares de capital, equivalente a un precio de conversión de 21,48 dólares por acción - un 12,5% de prima sobre el precio de cierre del 5 de marzo de 19,09 dólares. Al convertir, Hercules puede optar por liquidar en efectivo, acciones comunes o una combinación de ambas.
Los ingresos se utilizarán para financiar inversiones en valores de deuda y capital alineados con el objetivo de inversión de la empresa y para fines de capital de trabajo. Las notas vencerán el 1 de septiembre de 2028, sin derechos de redención anticipada.
헐큘리스 캐피탈 (NYSE: HTGC)는 2028년 만기 4.750% 전환 무담보 채권의 2억 8천7백50만 달러의 사모 공모를 성공적으로 마감하였으며, 3천7백50만 달러의 전량 초과 배정 옵션이 포함되어 있습니다. 이 채권은 Kroll 채권 평가 기관에서 BBB+ 등급을 받았으며, 자격을 갖춘 기관 투자자에게만 판매되었습니다.
전환 채권은 연 4.750%의 이자율을 반기별로 지급하며, 1,000달러의 원금당 46.5631주로 설정된 초기 전환 비율을 가지고 있으며, 이는 주당 21.48달러의 전환 가격에 해당하며, 3월 5일 종가 19.09달러에 비해 12.5%의 프리미엄이 있습니다. 전환 시, 헐큘리스는 현금, 보통주 또는 둘의 조합으로 결제할 수 있습니다.
수익금은 회사의 투자 목표에 맞는 채무 및 자본 증권에 대한 투자에 사용되며, 운영 자본 목적에도 사용됩니다. 이 채권은 2028년 9월 1일 만기되며, 조기 상환 권리는 없습니다.
Hercules Capital (NYSE: HTGC) a réussi à clôturer une offre privée de 287,5 millions de dollars en Obligations Convertibles Non Garanties à 4,750% échues en 2028, y compris une option de surallocation entièrement exercée de 37,5 millions de dollars. Les obligations, notées BBB+ par l'agence de notation Kroll, ont été vendues exclusivement à des acheteurs institutionnels qualifiés.
Les obligations convertibles présentent un taux d'intérêt annuel de 4,750% payé semestriellement et un taux de conversion initial de 46,5631 actions pour chaque 1 000 dollars de principal, équivalent à un prix de conversion de 21,48 dollars par action - une prime de 12,5% par rapport au prix de clôture du 5 mars à 19,09 dollars. Lors de la conversion, Hercules peut choisir de régler en espèces, en actions ordinaires ou une combinaison des deux.
Les produits seront utilisés pour financer des investissements dans des titres de créance et de capitaux propres alignés sur l'objectif d'investissement de l'entreprise et pour des besoins de fonds de roulement. Les obligations arriveront à échéance le 1er septembre 2028, sans droits de remboursement anticipé.
Hercules Capital (NYSE: HTGC) hat erfolgreich eine Privatplatzierung von 287,5 Millionen Dollar in 4,750% wandelbaren unbesicherten Anleihen mit Fälligkeit im Jahr 2028 abgeschlossen, einschließlich einer vollständig ausgeübten Überzeichnungsoption von 37,5 Millionen Dollar. Die Anleihen, die von der Kroll Bond Rating Agency mit BBB+ bewertet wurden, wurden ausschließlich an qualifizierte institutionelle Käufer verkauft.
Die wandelbaren Anleihen weisen einen jährlichen Zinssatz von 4,750% auf, der halbjährlich gezahlt wird, und einen anfänglichen Umtauschkurs von 46,5631 Aktien pro 1.000 Dollar Nennwert, was einem Umtauschpreis von 21,48 Dollar pro Aktie entspricht - ein Aufschlag von 12,5% gegenüber dem Schlusskurs vom 5. März von 19,09 Dollar. Bei der Umwandlung kann Hercules wählen, ob es in bar, in Stammaktien oder in einer Kombination aus beidem abgerechnet werden soll.
Die Erlöse werden verwendet, um Investitionen in Schulden- und Eigenkapitalwertpapiere zu finanzieren, die mit dem Anlageziel des Unternehmens übereinstimmen, sowie für Betriebskapitalzwecke. Die Anleihen laufen am 1. September 2028 ab, ohne vorzeitige Rückzahlungsrechte.
- Successfully raised $287.5 million through convertible note offering
- Strong BBB+ credit rating from Kroll Bond Rating Agency
- 12.5% conversion premium indicates confidence in share price appreciation
- Overallotment option fully exercised, showing strong investor demand
- Additional debt obligation with 4.750% interest expense
- Potential future dilution for shareholders upon conversion
- No early redemption rights for the company
Insights
Hercules Capital's $287.5 million convertible note offering represents a significant capital raise that strengthens the firm's investment capacity. The 4.75% interest rate is relatively competitive in the current environment for a business development company (BDC). The BBB+ rating from Kroll indicates solid creditworthiness, allowing HTGC to secure this financing on favorable terms.
The conversion premium of 12.5% above the current share price provides some protection against immediate dilution while offering noteholders potential upside if HTGC shares appreciate above the $21.48 conversion price. The 2028 maturity provides the company with long-term capital stability.
For a BDC like Hercules, which focuses on providing debt capital to venture-backed growth companies, this additional liquidity enhances their ability to pursue their core investment strategy. The structure of the offering - convertible unsecured notes - allows HTGC to balance between debt and potential equity components in their capital structure.
With the overallotment option fully exercised, this indicates strong institutional demand for HTGC's paper, a positive signal regarding market confidence. The proceeds will directly support their investment objective, potentially expanding their earning assets and supporting dividend sustainability. However, the additional debt will increase their leverage ratio, which warrants monitoring.
This $287.5 million convertible note issuance gives Hercules Capital additional deployment capital while maintaining financial flexibility. The BBB+ rating from Kroll represents investment-grade status, reflecting HTGC's solid credit profile despite operating in the higher-risk venture debt space.
The 4.75% coupon rate for these 3.5-year notes is aligned with current market pricing for similar BDC convertible offerings, neither particularly cheap nor expensive. The full exercise of the overallotment option ($37.5 million) indicates strong institutional appetite for this paper.
The 12.5% conversion premium sits in the typical range for BDC convertibles, balancing future potential shareholder dilution against immediate capital costs. The 2028 maturity provides HTGC with stable mid-term financing to match against their typically 3-4 year weighted average loan portfolio duration.
For investors, this transaction should be viewed in the context of HTGC's funding strategy - accessing longer-term unsecured debt to complement their credit facilities and SBA debentures. This diversified funding approach enhances their liquidity profile while supporting their specialist focus on technology and life sciences venture debt.
The no-redemption feature until maturity is slightly borrower-unfavorable as it removes HTGC's optionality to refinance if rates decrease, but provides certainty to noteholders, which likely helped secure the investment grade rating and competitive coupon rate.
Convertible Unsecured Notes due 2028 Initially Assigned a BBB+ by Kroll Bond Rating Agency
The Convertible Notes are unsecured and bear interest at a rate of
The Company intends to use the net proceeds from this offering (i) to fund investments in debt and equity securities in accordance with its investment objective and (ii) for working capital and other general corporate purposes.
Neither the Convertible Notes nor the common stock that may be issued upon conversion thereof will be registered under the Securities Act. Neither the Convertible Notes nor the common stock that may be issued upon conversion thereof may be offered or sold in
This press release does not constitute an offer to sell any securities of Hercules Capital, Inc. and is not soliciting an offer to buy such securities in any state where such offer and sale is not permitted.
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 and life sciences industries. Since inception (December 2003), Hercules has committed more than
Hercules, through its wholly owned subsidiary business, Hercules Adviser LLC (the “Adviser Subsidiary”), also maintains an asset management business through which it manages investments for external parties (“Adviser Funds”). The Adviser Subsidiary is registered as an investment adviser under the Investment Advisers Act of 1940.
Hercules’ common stock trades on the New York Stock Exchange (NYSE) under the ticker symbol “HTGC.” In addition, Hercules has one retail bond issuance of
Forward-Looking Statements
This press release may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. We may use words such as “anticipates,” “believes,” “expects,” “intends,” “will,” “should,” “may” and similar expressions to identify forward-looking statements. Forward-looking statements are not guarantees of future performance and should not be relied upon in making any investment decision. Such statements are based on currently available operating, financial and competitive information and are subject to various risks and uncertainties that could cause actual results to differ materially from our historical experience and our present expectations. While we cannot identify all such risks and uncertainties, we urge you to read the risks discussed in our Annual Report on Form 10-K and other materials that we publicly file with the Securities and Exchange Commission. Any forward-looking statements made in this press release are made only as of the date hereof. Hercules assumes no obligation to update any such statements in the future.
View source version on businesswire.com: https://www.businesswire.com/news/home/20250310134544/en/
Michael Hara
Investor Relations and Corporate Communications
Hercules Capital, Inc.
(650) 433-5578
mhara@htgc.com
Source: Hercules Capital, Inc.
FAQ
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