Pipeline Data secures $37 million from PIPE; GlobalOptions raises $45 million from notes

By Sheri Kasprzak

New York, June 29 - As stock market activity cranked back up, so did private placement activity. Heading up the slate of offerings on Thursday was a $37 million private placement from Pipeline Data Inc.

A group of institutional investors agreed to buy the four-year notes, which are convertible into common shares at $1.30 each. The coupon of the notes could not be determined by press time Thursday.

The investors will also receive warrants for 11.1 million shares, exercisable at $1.40 each.

Maxim Group LLC was the placement agent.

Lane Gordon of the company's investor relations department did not return calls on Thursday for additional terms and comment on the offering.

"We are pleased to announce the completion of this financing," said MacAllister Smith, the company's chief executive officer, in a news release. "The arrangement enables us to significantly reduce our borrowing costs and lengthen the term of our indebtedness. It also provides us with the capital to consummate acquisitions of merchant portfolios and operating companies, which we believe will significantly grow our revenue and cash flow.

"We feel this transaction is extremely beneficial for our company and for our shareholders."

The stock remained unchanged at $1.37 on Thursday (OTCBB: PPDA).

Proceeds will be used to refinance $17 million in short-term, high-coupon debt. The rest will be used for acquisitions.

This is not the first time Pipeline has headed to the PIPE market. On Dec. 20, 2005, the company completed a $15 million private placement of notes.

Pipeline, based in Quincy, Mass., provides processing services for major credit card companies.

In the broader market, stocks finally made some substantial gains after a week of losses and minor gains.

The Dow Jones Industrial Average climbed 217.24 to close at 11,190.80, and the Nasdaq composite index gained 62.54 to end at 2,174.38. The Standard & Poor's 500 composite index ended the day up 26.87 to settle at 1,272.87.

"It was the boost we needed," said one sellside market source. "Things are picking up."

GlobalOptions' deal

Elsewhere in PIPEs, GlobalOptions Group, Inc. raised another $30.5 million from a private placement of convertible notes, bringing to $45 million the total proceeds raised so far.

The 8% notes were immediately exchanged for series B convertible preferred stock and series B-1 and B-2 warrants.

After the offering was announced Thursday morning, the stock gained 10%, or 20 cents, to end at $2.20 (OTCBB: GLOI).

The 6% preferreds are convertible into common shares at $2.00 each.

The investors received series B-1 warrants equal to 35% of the shares issuable upon conversion of the notes, exercisable at $2.15 each and series B-2 warrants equal to 35% of the shares issuable upon conversion of the notes, exercisable at $2.85 each.

Burnham Hill Partners was the placement agent for the deal.

The first two tranches were closed in March and May for proceeds of $14.5 million.

The company expects to raise another $20 million from the deal.

Of the proceeds, $6 million will be used for debt repayment from the acquisition of SafirRosetti and another $4.5 million will be used to pay down a line of credit. The rest will be used for working capital.

"This financing strengthens our balance sheet significantly, providing us with $20 million of cash to finance our ongoing acquisition strategy and to support our continued organic growth," said Harvey Schiller, the company's chairman, in a statement. "Having completed four acquisitions in under a year - CBR, James Lee Witt Associates, SafirRosetti and Secure Source - we are well on our way towards achieving our revenue run rate target of $100 million by year-end.

"As we execute our growth strategy, we remain focused on leveraging the company's business capabilities across all operating units, successfully building a world-class global risk management platform."

New York-based GlobalOptions provides risk management and security to corporations, government organizations and high-profile individuals.

Genaera to raise $25 million

In the biotech sector, Genaera Corp. announced the pending completion of a $25,057,060 direct placement.

A group of institutional investors, including existing shareholders, have agreed to buy 35.6 million shares at $0.70385 each.

The deal was announced in the morning, and by the end of the day, the stock had fallen almost 6.5 cents, or 10.6%, to end at $0.5455 (Nasdaq: GENR).

The company will issue warrants for a total of 26.7 million shares, exercisable at $0.6101 each.

The shares and underlying shares will be sold under the company's shelf registration.

Banc of America Securities LLC was the bookrunner with Fortis Securities LLC as co-agent.

The offering is scheduled to close June 30.

On June 27, the company received notification from Nasdaq that it was in violation of its listing rules because its stock closed below $1.00.

The company closed a similar direct placement on Sept. 12, 2005, selling 11.4 million shares at $2.15 each for proceeds of $24.51 million.

Located in Plymouth Meeting, Pa., Genaera is a biopharmaceutical company focused on treatments for eye, respiratory and metabolic disorders, as well as for cancer.

Delphi Energy raises C$25 million

Looking to Canadian offerings, Delphi Energy Corp. completed a private placement for C$25,003,200.

The company sold 5,209,000 flow-through shares at C$4.80 each, including the over-allotment option for 1,042,000 shares exercised by a syndicate of underwriters led by GMP Securities LP and Dundee Securities Corp.

Proceeds will be used for debt repayment and for exploration on the company's Canadian properties.

Delphi, based in Calgary, Alta., is an oil and natural gas exploration company.

Pegasus stock climbs 8.27%

Pegasus Wireless Corp.'s stock gained 8.27% on Thursday, a day after the company settled a $10 million private placement of stock with its president.

The stock gained 67 cents to close at $8.77 (Nasdaq: PGWC). On Wednesday, the stock ended up 1.63%, or 13 cents, to settle at $8.10.

In the placement, Pegasus sold shares at $8.00 each to president Jasper Knabb.

Based in Freemont, Calif., Pegasus develops hardware and software products for wireless communications devices.

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