(Source: Business Wire)
Hercules Technology Growth Capital, Inc. (NASDAQ: HTGC), the leading specialty finance company providing venture debt and equity to venture capital and private equity-backed technology and life science companies at all stages of development, today announced that after its presentation to the Small Business Administration (SBA) committee on September 3, 2009, the Company has received a notice of approval by the SBA to pursue a second license as a Small Business Investment Company (SBIC). The second SBIC license will allow Hercules to access an additional $75 million of long-term non-callable capital, bringing Hercules's combined borrowing capacity through the SBIC program to a total of $225 million of capital.
In order to fully access the new $75 million, Hercules will, upon the receipt of the second license, be required to invest an additional $37.5 million into its newly formed wholly owned SBIC subsidiary, Hercules Technology III, L.P.
"Our partnership with the SBIC program is a strategic and long-term component to maintaining a highly liquid balance sheet in order to fund the needs of many technology and life sciences companies seeking growth capital. We are extremely pleased to receive the approval by the SBA to move forward with our second license. We anticipate final approval for the additional $75 million to occur in the first quarter of 2010," said Manuel A. Henriquez, co-founder, chairman and chief executive officer of Hercules.
As an existing member of the SBIC, Hercules was invited to present the Company's qualifications to the SBA for a second SBIC license on September 3, 2009. Select qualified SBICs have been given the opportunity to gain access to an additional $75 million, and higher under certain conditions, as the result of the American Recovery and Reinvestment Act of 2009 (Stimulus Bill) which contained a provision to increase the borrowing capacity of participants in the SBIC program. These provisions also increased the maximum amount of SBIC leverage capacity under its first license to $150 million from the prior maximum amount of approximately $137 million, of which Hercules has only drawn down $130.6 million.
"Over the course of the past few weeks, we are seeing some encouraging signs of economic recovery and we continue to believe that Hercules is well positioned to take advantage of the improving markets by maintaining a high level of liquidity. The additional capital from a second SBIC license will bolster our current liquidity position of approximately $125 million and play a beneficial part as we look to originate in an improved investment environment," Henriquez said.
