A health care management company says existing investors have agreed to supply $3.75 million in cash.
CareGuide Inc., Coral Springs, Fla., is obtaining the capital through a stock purchase agreement.
Under the terms of the agreement, CareGuide has agreed to sell shares of a newly designated series of preferred stock, each of which is convertible into 5 shares of common stock, the company says.
CareGuide issued about 1.6 million shares of the preferred stock Dec. 28, and the total offering as a value of about $937,500, the company says.
“At any time prior to April 1, 2008, subject to the terms of the purchase agreement, CareGuide, in its sole discretion, may cause the investors to purchase the remaining authorized shares of preferred stock on a pro rata basis,” the company says.
The investors include two venture capital funds and two individual CareGuide directors, the company says.
CareGuide has been “retooling” the company’s operations, and the capital infusion should help the company expand its complex care management operations and other operations, according to Chris Paterson, the company’s chief executive.
Albert Waxman, chairman of CareGuide’s board, says the investor group believes CareGuide “has redefined itself and, with some liquidity, can realize its 2008 growth objectives.”