Notes accrue interest initially at 12.5%, then 10% until maturity
By Devika Patel
Knoxville, Tenn., Dec. 19 ‑ CareView Communications, Inc. raised another $6 million in a private placement of senior secured convertible notes on Dec. 15, according to an 8-K filed Friday with the Securities and Exchange Commission. The deal raised $20 million on April 21, 2011 and $5 million on Jan. 31, 2012.
Interest accrues at 12.5% in the first five years and at 10% after that period until maturity.
The first-tranche notes are convertible into common shares at an initial conversion price of $1.25 per share. The conversion price reflects a 26.9% discount to the April 20, 2011 closing share price of $1.71.
The second-tranche notes are convertible into common shares at an initial conversion price of $0.40 per share. The conversion price reflects a 76.61% discount to the April 20, 2011 closing share price.
The third-tranche notes are convertible into common shares at an initial conversion price of $0.52 per share. The conversion price reflects a 69.59% discount to the April 20, 2011 closing share price.
The first-tranche notes mature on April 20, 2021, and the second-tranche notes are due Jan. 31, 2022.
The investors also received warrants for 11,782,859 shares in the first tranche, which are exercisable at $1.40 until April 21, 2021. The strike price is an 18.13% discount to the April 20, 2011 closing share price.
The company issued warrants for 4 million shares in the second tranche, which are exercisable at $0.40. The strike price is a 76.61% discount to the April 20, 2011 closing share price.
The company issued warrants for 3,692,308 shares in the third tranche, which are exercisable at $0.52. The strike price is a 69.59% discount to the April 20, 2011 closing share price.
Investors were HealthCor Partners Fund, LP and HealthCor Hybrid Offshore Master Fund, LP.
Based in Lewisville, Texas, CareView is an information technology provider to the health care industry
| Issuer: | CareView Communications, Inc.
|
| Issue: | Senior secured convertible notes
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| Amount: | $31 million
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| Maturity: | April 20, 2021 (for $20 million), Jan. 31, 2022 (for $5 million)
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| Coupon: | 12.5% in the first five years, 10% from five years to maturity
|
| Conversion price: | $1.25 (first tranche), $0.40 (second tranche), $0.52 (third tranche)
|
| Warrants: | For 11,782,859 shares (first tranche), for 4 million shares (second tranche), for 3,692,308 shares (third tranche)
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| Warrant expiration: | April 21, 2021 (first tranche)
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| Warrant strike price: | $1.40 (first tranche), $0.40 (second tranche), $0.52 (third tranche)
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| Investors: | HealthCor Partners Fund, LP (for $9,316,000) and HealthCor Hybrid Offshore Master Fund, LP (for $10,684,000)
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| Settlement dates: | April 21, 2011 (for $20 million), Jan. 31, 2012 (for $5 million), Dec. 15 (for $6 million)
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| Stock symbol: | OTCBB: CRVW
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| Stock price: | $1.70 at close April 21, 2011
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| Market capitalization: | $55.75 million
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