Legal Perspective on PatientPay's Latest Financing

In the most recent edition of Lawyer Monthly Magazine, Karim N. Momin, Esq. discusses what went into putting together PatientPay's most recent financing. Some key points include integrating with existing investors, finding new investors who bring strategic vision to the company and ensuring the long-term growth of PatientPay.

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Transaction Report: PatientPay Secures $6M in Funding led by Teaghlach Family Office, with Esping Family Office & Mosaik Partners
 

PatientPay, the leading patient payments partner for specialty care, has secured $6 million in growth capital. The investment will be leveraged for significant company expansion and continued enhancements to its patient payments platform, establishing the patient billing experience as a natural extension to patient care.

Teaglach Family Office led the round with participation from Esping Family Office and existing investors, including Mosaik Partners, to support PatientPay’s industry focus on providing
end-to-end patient payment solutions for anesthesiology, radiology, labs and other specialty medical groups at every point of care.

ADVISER INTERVIEW, Karim N. Momin, Esq., Morrison Cohen LLP

Please tell me about your involvement in the deal?
I acted as corporate counsel to PatientPay. We worked directly with the company and its existing investors to structure, negotiate and close the investment round with the new investors. There are a lot of detailed steps that have to be taken between the time an investor
determines to invest and the time that the closing can occur, each one involving numerous items that, while seemingly very technical, deal with rights and obligations that are quite important to both the company and its entire investor group. We assist at all phases of this process, from negotiating complex shareholder agreements to effectuating the ordinary course corporate approvals necessary to move the deal forward. Our goal is to make the process smooth and painless for our client as well as for its investors. To achieve this, recognising the dynamic amongst the parties in private equity transactions of this type is critical. Even though it’s a negotiation, both “sides” are really on the same team. Everyone wants the
company to succeed.

Why is this a good deal for all involved?
Bringing in a new round of financing is obviously great for the company as it will allow PatientPay to continue to execute on its business plan and build value for its investors. For the investors, broadening the investor base and having access to the resources and input of more
than one high-end private equity organisation is of tremendous value going forward-- it is the entire investor group that helps the company navigate its way to success. As for us, it is always great to be involved with interesting deals that feature great companies and investors.
Mosaik, the original institutional investor, is a top-tier operation and the guidance and experience of its principals were instrumental in achieving this incredibly positive result, as was the tireless hard work and dedication of the PatientPay executive team.

What challenges arose? How did you navigate them?
There are always challenges when introducing a new set of investors into an existing “relationship” between a company and its investor group. However, in this case, by keeping open and fluid lines of communication open amongst the lawyers, the company, Mosaik
and the new investors, the deal was brought to a successful conclusion with minimal problems. That’s always the goal from a transactional legal perspective. In my experience, there exists a solution for almost any issue so long as the parties are willing to be reasonable and
have an open, honest, good-faith conversation to discuss it. We try to help each party understand and address the concerns of the others—once that understanding is reached a workable solution is almost always evident to all. Of course, our job as lawyers is to always
achieve the best result for our client, but in the private equity world a company’s investors are in the truest sense its partners as well. Once the interests of partners in a venture are properly aligned, success follows as a result. With the closing of this transaction, PatientPay now
has not only Mosaik, but additional sophisticated parties working with it to build out its already-thriving business at the highest level.