Meta description: VSee Health introduces Series B Convertible Preferred Stock with clear conversion triggers and liquidation priority, aiming to support growth and investor protections.
VSee Health, Inc. has amended its corporate charter to establish a new class of Series B Convertible Preferred Stock. The move strengthens its capital structure and outlines specific terms for conversion, dividends, and liquidation priority. This update is relevant for investors tracking preferred equity strategies and startup founders interested in capital structuring mechanisms.
What are the Series B funding terms?
VSee Health designated 2,000 shares of Series B Preferred Stock. Each has a stated value of $1,000 and par value of $0.0001 per share. The class ranks senior to common stock and junior securities, equal to Series A Preferred Stock, and junior to any securities later marked as senior.
Dividend rights match those of common shareholders on an as-converted basis, triggered only if the board declares dividends. No additional dividends are attached to this class.
How does the Series B convert to common stock?
Holders may convert Series B shares into common stock at their discretion when certain conditions are met. The conversion calculation uses the $1,000 stated value divided by a conversion price of $0.65 per share. Conversion can only occur after investor gross proceeds from selling all investor shares drop below $2.3 million.
To prevent ownership concentration, conversions are limited by a 9.99% beneficial ownership cap for each investor.
What happens in liquidation scenarios?
If the company is liquidated, dissolved, or wound up, Series B shareholders receive their stated value plus any accrued but unpaid dividends before distributions to common and junior securities holders. After that payout, they can also share in remaining distributions on an as-converted basis with the common holders, subject to designations.
How will this affect VSee Health’s growth plans?
Creating the Series B Preferred Stock provides VSee Health with flexibility in attracting capital while protecting investor interests. This move comes alongside several developments indicating a focus on financial stabilization and operational expansion.
Recently, VSee Health regained compliance with Nasdaq’s minimum equity requirement of $2.5 million following a prior shortfall. The company also secured a $6 million private placement from a single institutional investor, involving 9,836,065 common shares and warrants for up to 19,672,130 shares at $0.61 per share.
Operationally, its iDoc telemedicine platform has been deployed in two new hospitals with expected annual revenue of $500,000. Tele-radiology services are now active in 21 out of the 34 hospitals in its network, affirming continued scale-up in healthcare delivery infrastructure.
FAQ
- What is the stated value of Series B Preferred Stock?
Each share has a $1,000 stated value. - Does the Series B carry voting rights?
No, except as required under Delaware law. - How does conversion work?
Conversion uses the $1,000 stated value divided by a $0.65 conversion price, triggered only when investor gross proceeds fall below $2.3 million, with a 9.99% ownership cap per holder. - Where does Series B sit in liquidation priority?
Series B ranks above common and junior securities, equal to Series A Preferred, and below any future senior securities. - What recent steps has VSee taken to improve finances?
Regained Nasdaq compliance, completed a $6 million private placement, and expanded telemedicine services.
Conclusion
VSee Health’s introduction of Series B Convertible Preferred Stock reflects a structured approach to fundraising while balancing investor protections with growth needs. The clear terms on conversion, dividends, and liquidation give the market defined expectations. For founders, this offers a case study in blending capital structure design with operational expansion. For investors, it presents a transparent preferred equity instrument aligned with recent capital inflows and compliance achievements.
Disclaimer
This content is for informational purposes only and should not be considered financial advice. Readers should consult with professional advisers before making investment decisions.