Hercules Capital Inc. is seeking shareholder approval to reduce the company's asset coverage requirements at a special meeting of shareholders to be held Dec. 6
The Small Business Credit Availability Act, which was passed into law March 23, permits Hercules Capital to reduce its asset coverage requirements, subject to receipt of approval from either the board or its shareholders.
The company's board approved the application, which would change the company's asset coverage requirements for senior securities to 150% from 200%, effective Sept. 4, 2019. If the company's shareholders approve the proposal at the special meeting, the modified asset coverage requirements will come into effect the day following the meeting.
A lower asset coverage ratio would help the company expand its total asset size and establish a well-diversified debt investment portfolio, Chairman and CEO Manuel Henriquez said in a statement.