Catasys entered into a $10 million financing comprised of a $2.5 million receivable facility with Heritage Bank of Commerce and a four-year, $7.5 million term loan with Horizon Technology Finance.
The initial interest rate on the receivable facility agreement will be Prime (currently 4.75%) plus 3%, or 7.75%. The initial interest rate on the term loan will be 9.75% and will float with LIBOR when north of 2% (currently 2.05%). The blended interest rate on the financing will initially be 9.10%.
The financing will be used to scale new contracts and expansions, invest in new technology platforms and provide excess capital.
“Given Horizon’s focus on financing for companies in the technology, life science, and healthcare information and services industries, we are pleased to lead this $10 million loan facility to support the potential for Catasys’ predictive analytics, artificial intelligence and telehealth to deliver significant savings to the largest health plans in the U.S.,” said Gerald A. Michaud, president of Horizon.
Catasys uses big data predictive analytics, artificial intelligence, telehealth and human intervention to deliver member health and cost savings to health plans through integrated technology-enabled treatment solutions.