Daily News: January 17, 2012

Hercules Announces Over $630 Million of Commitments in 2011

Hercules Technology Growth Capital, Inc., a specialty finance company addressing the capital needs of technology-related venture capital and private equity-backed companies, including cleantech, life sciences and technology companies, announced its fourth quarter 2011 portfolio update.

New Originations in the Fourth Quarter of 2011

  • Facebook Equity Investment

    In the fourth quarter, Hercules entered into an agreement to acquire approximately $9.6 million through a secondary marketplace in Facebook, Inc., the social networking company, on December 13, 2011 and December 20, 2011 for an aggregate of 307,500 shares at an average price of $31.08 per share. The investments are subject to certain closing conditions and a right of first refusal by Facebook, which expires 30 days after the date of investment. As a result, there is no assurance that the investment in Facebook, Inc. will close in a timely fashion or at all.

    New Loan Originations in the Fourth Quarter of 2011

    In the fourth quarter, Hercules originated loan commitments of approximately $165 million to new and existing portfolio companies. Hercules new investments include:

  • $500,000 commitment to AHHHA, Inc., a social ideation platform designed to leverage ideas from concept into a real-world product, service or company.

  • $15 million commitment to Blurb, Inc., a creative publishing and marketing platform.

  • $20 million commitment to Cempra Pharmaceuticals, Inc., a clinical-stage pharmaceutical company focused on developing antibacterials. On October 12, 2011, Cempra Holdings, LLC filed its S-1 registration statement with the SEC in anticipation of its contemplated initial public offering. There can be no assurances that Cempra will complete its IPO in a timely manner or at all.

  • $20 million commitment to Concert Pharmaceuticals, Inc., a clinical stage biotechnology company focused on creating differentiated small molecule drugs.

  • $3 million commitment to Integrated Photovoltaics, Inc., a company producing solar-power solutions through silicon photovoltaic technology.

  • $9.2 million commitment to MedCall, LLC, a provider of on-call pharmacy services.

  • $10 million commitment to Navidea Biopharmaceuticals, Inc. (NYSE Amex: NAVB), a biomedical company focused on the development and commercialization of precision diagnostic and radiopharmaceutical agents.

  • $20 million commitment to NextWave Pharmaceuticals Inc., an emerging pharmaceutical company focused on the development and commercialization of products for the treatment of ADHD and related CNS disorders.

  • $11 million commitment to Scientific Conservation, Inc., a provider of a cloud-based energy management platform for building owners and operators.

  • $600,000 commitment to Tada Innovations, Inc., an interactive online website operated by Shopzilla.com.

  • $21 million commitment to Westwood One, Inc., a provider of network radio programming. On October 21, 2011, Westwood One announced the consummation of a merger transaction, by and among Westwood, Radio Network Holdings, LLC, and Verge Media Companies, Inc. Westwood One, Inc. was renamed Dial Global, Inc. on December 12, 2011.

  • In addition, over $35 million in loan commitments were provided to existing portfolio companies.

    2011 Total Commitments

    In 2011, Hercules closed total loan commitments of approximately $630 million, an increase of over 20% from 2010.

    Inception Through Year-End 2011 Total Commitments

    Since its inception through December 31, 2011, Hercules has extended debt and equity commitments to portfolio companies totaling approximately $2.7 billion to over 190 companies.

    Liquidity Events and Current Companies in IPO Registration

    In the fourth quarter of 2011, Covidien plc announced its acquisition of Hercules’ portfolio company, BARRX Medical for an aggregate consideration of approximately $325 million, net of cash and short-term investments. The transaction closed on January 5, 2012.

    As of January 17, 2012, Hercules had warrant positions in over 104 different technology-related companies, nine of which have Form S-1 registration statements filed with the SEC in anticipation of completing a potential initial public offering or IPO. However, there can be no assurances that any of these companies will complete their respective IPO in a timely manner or at all.