Novavax stock slips on $38 million direct stock deal; Think Partnership pens terms for $26.5 million PIPE

By Sheri Kasprzak

New York, March 21 - Novavax, Inc. saw its stock drop more than 7% on Tuesday after the company announced the pending completion of a $38 million direct stock offering.

The company's stock fell 7.22%, or 60 cents, to close at $7.71, giving up another 2 cents in after-hours trading (Nasdaq: NVAX).

Novavax's stock had been falling steadily during the day after the deal was announced in the morning, losing 6.5% by 10 a.m. ET. By 1 p.m. ET, the stock had given up 5.05%.

A group of institutional investors agreed to buy 5,205,479 shares at $7.30 each, a 12% discount to the company's $8.31 closing stock price on March 20.

As of Feb. 28, the company had 54,734,346 outstanding common shares.

The shares will be offered under Novavax's shelf registration.

Rodman & Renshaw, LLC is the placement agent.

"There was more buying than selling again today," said one sellside trader. "It is still under mass accumulation."

The offering, the sellsider said, was a smart move even though he believes the stock will resume its upward track once the maneuvering related to the new deal subsides.

"They thought this was the peak of the rally and it would be months before they got another chance," he said. "They didn't need the money unless there was a pressing opportunity. They already had a huge cash position and they knew their stock price was on an uptrend."

On Feb. 27, Novavax closed a separate direct placement with Kleiner Perkins Caufield & Byers and Prospect Venture Partners. In that offering, the two investors bought 4,597,701 shares at $4.35 each under the company's shelf registration.

The company's stock closed at $5.72 on Feb. 27.

Proceeds will be used for the clinical development of virus-like particles-based avian and seasonal influenza vaccines, internal research and development programs and the expansion of research and development facilities to comply with current general manufacturing practices and good laboratory practices. The rest will be used for general corporate purposes.

Looking to the company's latest earnings statement, Novavax reported a net loss of $11.17 million for the year ended Dec. 31, compared with a net loss of $25.92 million for the year ended Dec. 31, 2004.

Based in Malvern, Pa., Novavax develops and commercializes drug-delivery and biological technologies, including virus-like particles-based vaccines.

Think Partnership's $26.5 million PIPE

Elsewhere in the PIPE market, Think Partnership Inc. is getting ready to complete the private placement of 10% convertible preferreds for proceeds of $26.5 million.

The series A preferreds are convertible into common shares at $2.00 each, a 2% discount to the company's closing stock price of $2.04 on March 20.

The investors will also receive warrants for 5.3 million shares, exercisable for five years at $2.50 each.

The deal was announced Tuesday afternoon, and by the end of the day, the company's stock had fallen 4 cents to finish at $2.00 (Amex: THK).

Proceeds of the preferred placement will be used to buy Litmus Media, Inc. and for general corporate purposes.

"I view this $26.5 million preferred stock placement as a vote by some very sophisticated investors in favor of the high quality of the entrepreneurs and businesses which have already merged and which are soon to merge into Think Partnership," said Gerard Jacobs, the company's chief executive officer, in a news release.

Think Partnership, formerly known as CGI Holding Corp., reported net income of $572,662 for the quarter ended Sept. 30, 2005, compared with net income of $703,055 for the same quarter of 2004.

Northbrook, Ill.-based Think Partnership is an online and print marketing, advertising, public relations and branding company.

Navarre raises $19.95 million

Moving to the tech sector, Navarre Corp. settled a $19.95 million private placement to partially repay a $25 million term loan C sub-facility with General Electric Capital Corp.

The shares - 5.7 million - were sold at $3.50 each, a 4.6% discount to Navarre's closing stock price of $3.67 on March 20. The investors also received warrants for 1.4 million shares, exercisable for five years at $5.00 each.

Craig-Hallum Capital Group LLC was the placement agent.

The rest of the loan, which bears interest at Libor plus 575 basis points, will be repaid using cash reserves and cash from operations.

Minneapolis-based Navarre develops entertainment and multimedia software products.

Elsewhere in the tech sector, BioForce Nanosciences Holdings, Inc. closed a $6 million private placement, selling shares at a 66% discount to its current stock price of $4.40.

On Tuesday, the stock remained unchanged (OTCBB: BFNH).

The company issued 4 million shares at $1.50 apiece to fund the commercialization of its NanoArrayer system, a software platform used to address intractable research problems.

BioForce became a publicly traded company on March 7 after BioForce Nanosciences acquired Silver River Ventures Inc., which changed its name to the current BioForce Nanosciences Holdings, Inc.

Based in Ames, Iowa, BioForce develops nanotechnology products with a focus on biotechnology applications.

Scorpio prices C$15 million deal

Among Canadian issuers, Scorpio Mining Corp. priced a C$15 million unit placement.

The offering includes 15 million units of one share and one half-share warrant. The whole warrants allow for the purchase of another share at C$1.25 each for two years.

Placement agent Research Capital Corp. has a greenshoe for up to 3 million additional units.

The proceeds will be used for exploration and development on the company's Nuestra Senora silver deposit in Mexico while the rest will be used for working capital.

Scorpio's stock remained unchanged Tuesday at C$1.02 (TSX Venture: SPM).

Vancouver, B.C.-based Scorpio is a silver exploration company.

Vyyo stock slips 4.5%

After completing its previously announced $24,997,642 private placement with Goldman, Sachs & Co., Vyyo Inc.'s stock continued to fall Tuesday.

The stock retreated 4.56%, or 34 cents, Tuesday to settle at $7.11 (Nasdaq: VYYO).

On Monday, when the deal was announced, Vyyo's stock gave up 85 cents, or 10.24%, to finish at $7.45.

Trading volume of Vyyo's stock also remained higher than average with 148,256 shares traded, compared with the three-month running average 63,709 shares traded. On Monday, 237,340 shares were traded.

In the placement, Goldman agreed to buy a $10 million convertible note - convertible into common shares at $10.00 each, a $7.5 million non-convertible note and 1,353,365 shares at $5.54 each.

The conversion price of the note is a 34% premium to the company's $7.45 closing stock price on March 20, and the price per share is a 25% discount to the same closing price.

Katalyst Securities LLC was the placement agent for the offering.

Atlanta-based Vyyo develops wireless broadband technologies used by cable television and telecommunications providers.

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