- Seeking to cut future interest expense and "better align" borrowing commitments with its equity base, Horizon Technology Finance (NASDAQ:HRZN) decides on early repayment and closing of its term credit facility with Fortress Credit. Horizon still maintains a $50M line with Key Equipment Finance.
- The move will cut the interest rate on Horizon's borrowings to 6.2% in H2 from 6.9% in H1. Horizon will record a charge of $1.9M in Q2, with $1.1M of that a non-cash expense from the acceleration of unamortized debt issuance cost, and the rest a prepayment penalty. This charge will be cut by about $700K as the company won't need to pay to an advisor a fee due had the facility not been terminated.
- Starting in Q3, Horizon expects to reduce its quarterly interest expense by about $300K, or $0.03 per share.
- Source: Press Release