Climbing gold prices spark $68.5 million PIPE from Nautilus; Aquiline prices, upsizes two placements

By Sheri Kasprzak

New York, Oct. 30 - Gold and silver prices took off on Monday as two gold companies announced their plans to conduct private placements.

One market source familiar with the natural resources' sector said he feels the two offerings are a good indication of investor demand.

"Gold has been kind of shaky," he said Monday. "It's up and down quite a bit, mostly because oil has been up and down quite a bit."

On Monday, however, gold prices advanced in spite of a $2.39 drop in oil prices. Oil ended the day at $58.36 per barrel.

Gold prices climbed $6.40 to close at $607.40 per ounce, and silver prices gained 17 cents to end at $12.25 per ounce.

"Now that gold is up again, you're seeing more deals," the market source added. "This has happened before. Gold will go back up and you'll see more [private placements]. It goes back down and activity tapers off."

Nautilus plans PIPE

Heading up the two gold offerings announced Monday was a $68.5 million stock offering from Nautilus Minerals Inc.

The gold and copper explorer intends to issue 22,833,334 shares at $3.00 apiece. So far, Anglo American plc has agreed to invest $25 million in the offering.

The company's stock took off early after the deal was announced Monday morning, gaining more than 43% by 10 a.m. ET. The stock went on to gain 40.62%, or 78 cents, to close at C$2.70 (TSX Venture: NUS).

The volume of Nautilus shares traded Monday also skyrocketed, with 909,666 shares traded compared with the average 35,864 shares.

Connected to the offering, Nautilus signed an agreement with Anglo American to develop Solwara and other projects at Anglo's cost. The agreement is for a five-year term and would also allow Anglo American to enter into a joint venture on any areas Nautilus holds exploration rights to on Oct. 20.

Proceeds will be used for development of Nautilus' business.

Vancouver, B.C.-based Nautilus is a gold and copper exploration and development company focused on underwater mineral exploration.

Aquiline prices deal

Elsewhere in gold offerings, Aquiline Resources Inc. priced and increased the size of two private placements for total proceeds of C$20 million.

In a brokered deal, Aquiline plans to sell 2,150,538 shares at C$4.65 each.

Sprott Securities Inc. is the placement agent for the brokered portion of the deal.

Also, the company intends to sell, on a non-brokered basis, 2,150,538 shares at the same price.

The offerings are set to close Nov. 14.

On Monday, the company's stock slipped by 3 cents, or 0.62%, to close at C$4.84 (Toronto: AQI).

Proceeds will be used for exploration and development on the company's Calcatreu project in Rio Negro Province, Argentina, as well as for exploration and development at the Navidad project in the Chubut Province, Argentina. The rest will be used for general corporate purposes and to reimburse IMA Exploration Inc. for costs related to a project development agreement between the two companies.

Toronto-based Aquiline is a gold and silver exploration and development company.

Endocare's $16 million equity line

Heading to the biotech sector, Endocare, Inc. entered into a $16 million stock purchase agreement with Fusion Capital Fund II, LLC.

After news of the equity line was announced Monday morning, the stock went on to lose 2.78%, or 5 cents, to close at $1.75 (OTCBB: ENDO).

Volume of Endocare stock traded Monday took off with 208,610 shares traded. On average, 74,569 shares are traded.

Fusion may buy shares of Endocare over the next two years at a price based upon the market price of Endocare's stock at the time of a draw. There is no set discount. Fusion does not have the right to purchase shares of Endocare in any trading day the stock closes below $1.00.

"The Fusion Capital agreement, along with our available borrowing capacity under our existing $4 million credit facility with Silicon Valley Bank, will help provide the company with the opportunity to use the most appropriate source of operating and growth capital, whether debt or equity, if and when we need it," said Endocare chief financial officer Michael Rodriguez in a statement. "As we continue to improve our gross margins and reduce operating expenses, we expect to continue to invest in cryoablation opportunities in the interventional radiology and oncology markets, and growth capital is key to this strategy."

Proceeds will be used for the company's work in prostate and renal cancer cryoablation. The rest will be used to expand the company's interventional radiology and oncology markets to treat lung and liver cancers and bone pain associated with cancer metastases.

Located in Irvine, Calif., Endocare is a medical device company focused on minimally invasive treatments for tissue and tumor ablation.

Quantum secures $10 million

In the tech sector, Quantum Technologies, Inc. said it secured agreements for a $10,004,000 private placement.

Institutional investors intend to buy 6.1 million shares at $1.64 each and will receive warrants for 2.1 million shares. Each warrant is exercisable for seven years at $2.36 each.

The investors also have the option buy another 1.8 million shares at the same price as this offering and would receive warrants for another 600,000 shares.

The deal is expected to close Nov. 1.

The company's stock started its descent rather early in the session, giving up 13.66% at 10:30 a.m. ET. The stock went on to lose 16.1%, or 33 cents, to end the session at $1.72 (Nasdaq: QTWW).

Based in Irvine, Calif., Quantum develops fuel systems and accessories for specialty vehicles and applications like fuel cells, hybrid engines, alternative fuels and hydrogen refueling. The company also manufactures hybrid and fuel cell vehicles.

Lakeview's C$32 million deal

Among Canadian issuers, Lakeview Hotel Real Estate Investment Trust negotiated the terms Monday of a C$32 million private placement.

The company plans to sell up to 8 million trust units at C$4.00 apiece.

The deal is being placed through a syndicate of agents led by Wellington West Capital Inc. and Desjardins Securities Inc.

The placement is scheduled to close Nov. 8.

On Monday, the company's stock fell by 15 cents, or 3.53%, to close at C$4.10 (TSX Venture: LRH).

Proceeds will be used for ongoing acquisitions, including three hotel properties in British Columbia currently under contract.

Based in Winnipeg, Man., Lakeview is real estate investment trust focused on acquiring hotel and resort properties in Canada.

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