A Medical Device Daily
ArthroCare (Austin, Texas) reported that it has closed its previously reported financing with One Equity Partners (OEP; New York), the global private equity investment arm of JPMorgan Chase & Co. (also New York) (Medical Device Daily, Aug. 18, 2009).
In connection with the financing, OEP has purchased $75 million of newly-issued ArthroCare Series A convertible preferred stock, which will be convertible into shares of ArthroCare common stock at $15 per share, a premium over the closing price of the company's common stock on Aug. 14, 2009 and the 30-day trading average. Upon the close of the transaction today, and in conjunction with OEP's investment, Chris Ahrens and Greg Belinfanti, both Partners of OEP, will join ArthroCare's board.
In conjunction with the closing of the financing, ArthroCare has repaid all obligations under the company's credit agreement and expects to use the remaining portion of the proceeds for general corporate purposes. Additionally, all rights and obligations under the credit agreement are being terminated and all security interests and other encumbrances are being released, other than the company's obligations with respect to a letter of credit issued in favor of a lender affiliate under the credit agreement in the amount of $750,000, which will be cash collateralized in the approximate amount of $1.4 million.
Neuronetics (Malvern, Pennsylvania)raised $30 million in a fourth round of venture capital funding.
New Leaf Venture Partners (New York) led the round and it included previous investors Quaker BioVentures (Philadelphia), Investor Growth Capital (Stockholm, Sweden), Three Arch Partners (Portola Valley, California), Onset Ventures (Menlo Park, California), Interwest Partners (Dallas) and KBL Healthcare Ventures (New York).
The company developed the NeuroStar system, which treats depression using MRI-strength magnetic field pulses that stimulate nerve cells in an area of the brain that is linked to depression.
In other financing activity:
• American HomePatient (Brentwood, Tennessee) reported that it has entered into a second forbearance agreement with NexBank, SSB (Dallas) the agent for its senior debt (the agent), and a majority of the senior debt holders (the forbearance holders).
Nearly $226 million was due to be repaid in full on the maturity date of Aug. 1, 2009 pursuant to the terms of the company's secured promissory note to the agent.
• PinPointe (Chico, California) a privately held emerging medical technology company which introduced the PinPointe FootLaser reported that it has received additional venture capital funding. The capital infusion, from Western Technology Investment is a clear indication of PinPointe USA's marketplace strength, vitality and growth potential, the company said. This type of transaction financing is typically reserved for rapidly growing and profitable companies.
"While the company is cash flow positive and profitable, this new investment will allow accelerated development of a variety of international business opportunities," said Bob Katz, president/CEO of PinPointe USA.