SpatiaLight pens $15.4 million equity line; Stealth Ventures pockets C$16.6 million from PIPE

By Sheri Kasprzak

New York, April 30 - SpatiaLight, Inc. secured $15.4 million on Monday from an equity credit agreement to settle a dispute with six investors from a November 2006 PIPE.

After the deal was announced Monday morning, the company's stock plummeted 22.18%, or 8 cents, to end at $0.28. The stock fell another penny in after-hours trading (Nasdaq: HDTV).

The company plans to sell, over the next 18 months, shares of its stock to Southridge Partners, LP; Southshore Capital Fund Ltd.; Pierce Diversified Strategy Master Fund, LLC, ENA; Enable Opportunity Partners, LP; Enable Growth Partners LP; and Iroquois Master Fund, Ltd.

Of the proceeds, $3.7 million will be sold at market price on the dates of sale. The rest will be sold at 95% of the market value on the dates of sale.

The equity line was conducted in consideration for a waiver, rescission and settlement of a dispute involving warrants for 4.8 million shares. The warrants, which were issued in a November 2006 private placement, were returned to the company. The investors will also return 4,002,307 shares issued in the placement in November and in a February 2007 financing for resale. The shares have a $4,354,387 value.

Also on Monday, SpatiaLight acknowledged that it has failed to meet Nasdaq Stock Market listing requirements because its stock has closed below the minimum $1.00 per share for 30 consecutive trading days.

Unless the stock closes above $1.00 per share for 10 consecutive trading days before Oct. 17, 2007, the stock will be removed from Nasdaq.

Based in Novato, Calif., Spatialight develops liquid crystal on silicon microdisplays.

Volume may improve

Even as stocks fell on Monday, one market insider remained optimistic that volume would improve in the broader PIPE market, but the faces will remain basically the same in terms of particular sectors, he said.

"The stock market as a whole is still doing fine," he noted. "I think we're not really going to be seeing a lot of new things in terms of sectors. You've still got tech, biotech, resources ... those have always been the major players and as far as I can tell, they will continue to be at least for the foreseeable future."

Stealth Ventures raises C$16.6 million

In other PIPE news Monday, Stealth Ventures Ltd. concluded a C$16.6 million private placement of units.

The company sold 13.28 million units of one share and one half-share warrant at C$1.25 each.

Each whole warrant will be exercisable at C$1.50 through Oct. 26, 2008.

D&D Securities Corp. was the placement agent.

Proceeds will be used for ongoing exploration on the company's Shale Gas properties in Saskatchewan and Alberta and for its coal-bed methane properties in Nova Scotia. The rest will be used for general corporate purposes.

The deal was announced in March as a C$10 million offering.

The company's stock closed unchanged at C$1.35 Monday (TSX Venture: SLV).

Calgary, Alta.-based Stealth is an oil and natural gas exploration company.

Aurora Gold stock falls

Elsewhere in the resources sector, Aurora Gold Corp.'s stock dipped slightly on news that the company will conduct a $2 million private placement to finance diamond drilling in the Tapajos Gold Province of Brazil.

The pricing terms of the deal have yet to be determined.

The stock gave up 2 cents, or 4.17%, to close at $0.46 (OTCBB: ARXG).

Based in Balcatta, Australia, Aurora is a gold and diamond exploration and development company.

In other diamond-related offerings, Bannockburn Resources Ltd. priced a C$5 million offering of stock.

The company plans to sell, on a non-brokered basis, 1 million shares in the deal.

Proceeds will be used for the acquisition of 70% interest in the Mothae diamond project in Lesotho, Africa, and for upcoming work programs. The rest will be used for working capital and general corporate purposes.

The company's stock gained a penny on Monday to close at C$5.10 (CNQ: BKNN).

Vancouver, B.C.-based Bannockburn is a gold and precious metals mining company.

Stellar raises C$1 million

In another gold-related deal, Stellar Pacific Ventures Inc. sold C$1 million in flow-through units to MineralFields Group Ltd.

MineralFields bought 4 million units at C$0.25 apiece.

The units consist of one share and one flow-through warrant. The warrants are exercisable at C$0.25 each for the first year and at C$0.30 each for the second year.

Proceeds will be used for Canadian exploration expenses on the company's Quebec-based properties.

Stellar's stock fell 7.5%, or a penny and a half, to settle at C$0.185 (TSX Venture: SPX).

"We are very pleased to be entering into this relationship with MineralFields Group," said Stellar chief executive officer Michael Lemay in a news release. "This is an important milestone in the growth of Stellar Pacific Ventures Inc. and we look forward to working with MineralFields Group as we develop our holdings."

Based in Laval, Quebec, Stellar is a gold exploration company.

American Real Estate stock dives

Following reports that its stock is "overvalued," American Real Estate Partners, LP's stock fell by 17.42% on Monday after the company settled a $600 million PIPE on Friday.

The stock gave up $18.90 to close at $89.61, gaining $4.85 in after-hours trading (NYSE: ACP). On Friday, the stock fell 49 cents to close at $108.51.

The dive comes after a Barron's article was released Monday claiming that American Real Estate's shares are worth only about $65 per share.

In the placement, American Real Estate sold variable-rate senior convertible notes. The notes are convertible into depositary units at $132.595 each.

The notes, due 2013, were purchased by Portside Growth and Opportunity Fund; an investment fund managed by Ramius Capital Group, LLC; and an investment fund managed by Highbridge Capital Management, LLC.

The notes bear interest at Libor minus 125 basis points with a 4% floor and a 5.5% ceiling.

New York-based American Real Estate Partners is a holding company for real estate, gaming and home fashions industries.

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