Hercules Capital announced that the U.S. Small Business Administration (“SBA”) has issued a “green light” letter inviting Hercules to submit an application to obtain a license to form and operate a fourth Small Business Investment Company (“SBIC”) subsidiary, following the Company’s recent presentation to the SBA committee.

“Our long-standing partnership with the SBIC program remains an important and strategic component to maintaining a highly liquid and diversified balance sheet and it provides us with further flexibility to be able to continue to support small and growth-oriented businesses,” said Scott Bluestein, chief executive officer and chief investment officer of Hercules Capital. “We are extremely pleased to receive the ‘green light’ letter from the SBA. A fourth SBIC license would enable us to continue to fund the needs of many innovative technology and life sciences companies seeking growth capital while helping to maintain our overall blended cost of capital by accessing favorable long-term financing.”

Upon approval, Hercules would obtain a fourth SBIC license held by subsidiaries of the Company and continue to access additional growth capital of $175.0 million of long-term debentures, bringing Hercules’ combined borrowing capacity through the SBIC program to a total of $350.0 million of capital. However, receipt of a green light letter from the SBA does not assure an applicant that the SBA will ultimately issue an SBIC license, and Hercules has received no assurance or indication from the SBA that it will ultimately receive an SBIC license, or of the timeframe in which it would receive a license, should one ultimately be granted.

The SBA program has played an important role within Hercules’ funding strategy since receiving its first SBIC license in September 2006. Hercules received exemptive relief from the Securities and Exchange Commission that allows Hercules to exclude SBIC leverage from applicable asset coverage limits.