📜 What This Document Is

This is a Definitive Proxy Statement (DEF 14A) for Hercules Capital, Inc. Think of it as an invitation and instruction manual for the company's annual shareholder meeting. It tells you what's being voted on, who is on the leadership team, and how they get paid.

👉 In short: This document lets shareholders make informed votes on company matters without being physically present at the virtual meeting on June 18, 2026.

🏢 What The Company Does

Hercules Capital (ticker: HTGC) is a specialty finance company. They are a Business Development Company (BDC), which means they're like a bank for startups and high-growth companies.

👉 Their business model: They provide senior secured loans (the safest type of debt) to venture capital-backed companies, mostly in technology and life sciences. They make money from the interest on these loans and from gains on warrants (options to buy stock) in the companies they lend to.

🗳️ The 2026 Annual Meeting: Your 7 Voting Items

The core purpose of this filing is to get shareholder votes on these key proposals:

1. Elect an Independent Director: Vote to re-elect Robert P. Badavas to the board. He’s been on the board since 2006 and is the Lead Independent Director and Chairman.
2. "Say-on-Pay" Advisory Vote: An advisory (non-binding) vote to approve the compensation of the company's top executives (Named Executive Officers or NEOs).
3. "Say-on-Frequency" Advisory Vote: Decide how often shareholders should vote on executive pay (every 1, 2, or 3 years).
4. Approve the Equity Incentive Plan: Amend and restate the 2018 plan that grants stock awards to employees and executives.
5. Approve the Director Plan: Amend and restate the 2018 plan for compensating non-employee directors with equity.
6. Ratify the Auditor: Approve PricewaterhouseCoopers LLP as the company's accounting firm for 2026.
7. Other Business: Handle any other matters that may come up.

👉 How to vote: You can vote online at www.proxyvote.com, by phone at 1-800-690-6903, or by mail. Your 16-digit control number is your key.

👥 Who's Running the Show? (Board & Management)

The board is divided into three classes with staggered terms. The company highlights its strong governance:

• Board Structure: The board has a majority of independent directors. Robert P. Badavas serves as the Lead Independent Director & Chairman.
• Key Committees: All committee members are independent directors.
  • Audit Committee: Oversees financial reporting and auditors (met 5 times in 2025).
  • Compensation Committee: Sets executive pay (met 5 times in 2025).
  • Nominating & Corporate Governance Committee: Finds director candidates (met 4 times in 2025).
• Executive Team (Named Executive Officers):
  • Scott Bluestein: CEO & Chief Investment Officer. He's the only "interested" director because of his management role.
  • Seth H. Meyer: Chief Financial Officer.
  • Christian Follmann: Chief Operating Officer.
  • Kiersten Zaza Botelho: Chief Legal Officer, Chief Compliance Officer & Corporate Secretary.

📊 Who Owns the Company? (Stock Ownership)

As of the record date (April 9, 2026), there were 187,133,158 shares outstanding. Key owners include:

• Management & Board: As a group (11 persons), they own 2.0% of the company. CEO Scott Bluestein owns the most among them at 1.3% (2,495,986 shares).
• Big Institutional Shareholder: Kingdom Holding Company (based in Saudi Arabia) is the only known owner of more than 5%, holding 5.03% (9,411,490 shares).

👉 Why it matters: This shows management has "skin in the game," but a large external shareholder also has significant influence.

💰 How Executives Get Paid (Compensation)

The company follows a "pay-for-performance" philosophy, with heavy scrutiny from the Compensation Committee.

• What they measure: They benchmark themselves against a peer group of other BDCs, financial firms, and REITs. Hercules' performance in 2025 was stellar, ranking in the 75th to 100th percentile across key metrics like Return on Average Assets (ROAA) and Return on Equity (ROE).
• Components of Pay:
  1. Base Salary: Fixed cash pay.
  2. Annual Cash Bonus: Based on company and individual performance.
  3. Long-Term Incentives: Stock awards to align with shareholder interests over time.
• Key Restriction: As a BDC, Hercules faces unique regulatory limits from the Investment Company Act of 1940 on how it can structure incentive compensation.

⚖️ Big Picture: Strengths & Risks

👍 Strengths:

• Strong Governance: Majority-independent board, robust committees, and clear oversight.
• Aligned Interests: Management owns stock, and pay is tied to long-term performance.
• Proven Performance: Consistently outperforms its peer group on key financial metrics.
• Clear Strategy: Focuses on a specific niche (venture debt for tech & life science).

⚠️ Risks & Considerations:

• Concentrated Business Model: Performance is tied to the health of the venture capital ecosystem and specific industries.
• Credit Risk: Their success depends on the startups they lend to being able to repay their loans.
• Regulatory Complexity: Operating as a BDC comes with strict and unique rules that affect operations and compensation.

🔍 The Details: Key Proposals Explained

• Proposal 1 (Director Election): The board recommends voting FOR Robert Badavas. If he loses the vote, he must offer to resign.
• Proposals 4 & 5 (Plan Amendments): These updates to the equity plans are necessary to continue attracting and retaining talent by granting stock awards. They require shareholder approval.
• Proposal 6 (Auditor Ratification): A routine but important check on the company's financial overseers. The board recommends voting FOR.

🧠 The Analogy

Think of Hercules Capital like a highly specialized credit union for Silicon Valley's most promising startups. This proxy statement is the annual town hall meeting. The shareholders (the credit union's members) are being asked to vote on: who sits on the board (the town council), how much the mayor and city managers get paid (their salaries), and whether to renew the contract with the city's auditors. The document shows the town has been run well and profitably, but its success depends entirely on the health of the businesses it lends to.

🧩 Final Takeaway

Hercules Capital is seeking shareholder approval for its board, executive pay, and incentive plans after a year of strong relative performance. The filing reveals a company with robust governance and a management team whose interests are aligned with shareholders, but one whose fortunes are deeply tied to the volatile venture capital market. Your vote directs the future leadership and compensation philosophy of this specialized lender.