Online Resources pockets $75 million from preferreds; Monogram gets $25 million infusion from Pfizer

By Sheri Kasprzak

New York, May 8 - As PIPE action picked up again after the weekend, Online Resources Corp. came away with $75 million from a private placement and also secured $85 million from senior secured notes.

Tennenbaum Capital Partners, LLC bought the 8% preferreds and the notes as part of Online Resources' acquisition of Princeton eCom Corp., a company that provides electronic payment options to financial institutions.

The preferreds are convertible into common shares at 125% of the volume weighted average price of the company's stock for the 10 trading days before the merger is completed. The merger is expected to close July 15.

The six-year notes bear interest at Libor plus 700 basis points and may be prepaid at 102% of face value for the first year, at 101% during the second year and at par thereafter.

Lehman Brothers Inc. was the placement agent.

Under the terms of the merger, Online has agreed to acquire Princeton at a minimum of $180 million and a maximum of $190 million in cash.

"Princeton eCom provides us with a single transforming opportunity that leapfrogs years of business development to achieve our strategic goals," said Matthew Lawlor, Online Resources' chief executive, in a news release. "First, by consolidating our consumer service provider platforms, we gain significant distribution and economies of scale in serving the financial institution market with our pay anyone service. Second, we gain a solid business and management team in the biller service provider market, enabling us to jumpstart our strategic real-time payments initiative. Together, these capabilities make us a major force in web-based payments."

Upon the announcement of the PIPE, the stock gained 52 cents, or 3.89%, to end the day at $13.89 (Nasdaq: ORCC).

For the fourth quarter of 2005, Online Resources' highest closing stock price was $12.16, compared to the highest closing stock price of $7.53 for the same quarter of 2004. The lowest closing stock price was $10.50 for the fourth quarter of 2005, compared with $6.70 in the fourth quarter of 2004.

For the year ended Dec. 31, the company reported net income of $22.66 million, compared with net income of $3.95 million for the year ended Dec. 31, 2004.

Based in Chantilly, Va., Online Resources provides web-based banking and payment services to financial institutions.

Monogram raises $25 million

Monogram Biosciences, Inc. saw its stock skyrocket after receiving a $25 million investment from Pfizer Inc. and embarking upon a collaboration with Pfizer to develop Monogram's co-receptor tropism assay.

The stock gained 61 cents, or 36.09%, to wrap at $2.30 (Nasdaq: MGRM). The jump represents the single-largest gain in the company's stock so far this year.

Pfizer agreed to fund a 3% note due May 19, 2010 convertible into common shares at a 20% premium to the average closing stock price for five trading days before conversion.

Once a registration statement covering the underlying shares is declared effective, the note will automatically convert any time the stock price exceeds 150% of the conversion price for 20 of 30 consecutive trading days.

"This is really great for them," said one buysider familiar with the name. "Pfizer is a huge name. With the collaboration, the investment, it makes a big difference to them."

A sellside trader agreed.

"Everyone is going to want a piece of them now," the trader said. "It's buy, buy, buy."

Volume of Monogram shares traded Monday exploded with 15,880,180 shares traded compared with the average 524,764 shares.

Under the collaboration, Pfizer and Monogram will jointly develop and market Monogram's co-receptor tropism assay in the United States. Pfizer has agreed to market the assay internationally.

"Monogram and Pfizer have had an outstanding business relationship for a number of years," said William D. Young, Monogram's chief executive officer, in a news release. "In 2002, Pfizer made an equity investment in Monogram and since that time, we have provided sophisticated molecular diagnostic testing services and scientific assistance in the area of HIV drug resistance for many of Pfizer's HIV programs, including the ongoing phase 3 maraviroc clinical development program.

"We are now delighted to be significantly extending that relationship through Pfizer's investment of additional capital and through a collaboration to make our co-receptor tropism assay available globally."

"Pfizer's $25 million investment is expected to provide significantly greater financial flexibility to Monogram," said Monogram chief financial officer Alfred Merriweather in the statement. "At the end of the first quarter of 2006, we had $67 million in cash and investments. On a pro forma basis, including the anticipated proceeds of Pfizer's investment, these cash resources would be $92 million.

"This strengthening of our balance sheet gives us enhanced flexibility to address our business and financial opportunities and to facilitate Monogram's continued growth and development."

San Francisco-based Monogram develops treatments for infectious diseases and cancer.

Pacific Comox leads Canadian PIPEs

In Canada, Pacific Comox Resources Ltd. priced a C$6,285,000 private placement comprised of 71.4 million units and 14.3 million flow-through units.

The units are priced at C$0.07 each and the flow-through units at C$0.09 each.

The non flow-through units are comprised of one share and one warrant with each warrant exercisable at C$0.10 for two years.

The flow-through units include one share and one warrant. Each warrant is also exercisable at C$0.10 for two years.

Dominick & Dominick Securities Inc. is the placement agent.

Proceeds from the deal will be used for diamond drilling and for the development of the company's Ryan Lake copper-molybdenum properties near Matachewan, Ont. The rest will be used for working capital.

The stock remained unchanged Monday at C$0.08 (TSX Venture: PCM).

Toronto-based Pacific Comox is a mineral exploration company.

In other Canadian natural resources activity, Signet Minerals Inc. negotiated a C$3.5 million private placement.

The deal is comprised of up to 3,896,104 flow-through units at C$0.77 each and up to 769,231 units at C$0.65 each.

The common units are comprised of one share and one half-share warrant. Each whole warrant is exercisable at C$0.85 each for 18 months.

The flow-through units consist of one share and one half-share warrant. Each full warrant is exercisable at C$0.95 each for 18 months.

The placement agent Toll Cross Securities Inc. has a greenshoe for up to 1,298,701 flow-through units and 769,231 non flow-through units.

The proceeds will be used for exploration on the company's Curie and Golden projects, as well as for general corporate purposes.

Signet's stock ended the day up 3 cents, or 4.55%, to close at C$0.69 (TSX Venture: SGN).

Based in Comox, B.C., Signet is a mineral exploration company.

Amedia stock dives

Amedia Networks, Inc.'s stock took a dip on Monday after the company announced a $10 million private placement of 8% senior secured convertible debentures.

The stock closed down 10.89%, or 11 cents, to settle at $0.90 (OTCBB: AANI).

On Friday, when the debenture offering was announced, the stock gained a penny to close at $1.01.

Based in Holmdel, N.J., Amedia develops technology-based broadband access products for voice, video and data services.

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