U.S. volume improves slightly on better stocks; Blizzard Energy plans C$50 million deal

By Sheri Kasprzak

Atlanta, Dec. 8 - U.S. private placement volume improved slightly, according to sell-side sources, thanks to the strong stock market, particularly for biotechnology and technology names.

"We have seen a bit more issuance today," said one sell-side source. "Stocks are much better than yesterday, so issuers have a bit more confidence in the market. We have seen some deals in biotech and tech, and those were both strong markets today."

The Dow Jones Industrial Average ended the day up 53.65 at 10,494.23, Nasdaq was up 11.45 to close at 2,126.11 and the S&P 500 gained 5.74 Wednesday to end the day at 1,182.81.

Better oil prices helped volume in Canada, where Blizzard Energy Inc. announced the largest offering of the day. Oil prices gained $0.48 to close at $41.94 per barrel Wednesday.

Blizzard hit the private placement market Wednesday with a C$50 million deal that includes 18 million shares at C$2.20 each and 3,720,500 flow-through shares at C$2.80 each.

"It looks like it's priced at a slight discount to market, but for an oil company, which have been undervalued for a while now, it's a pretty good deal," said one Canadian market source.

The company's stock closed Wednesday down C$0.06 at C$2.31.

Orion Securities Inc. and GMP Securities Ltd. are the lead underwriters in a syndicate for the offering.

Blizzard is an oil and natural gas exploration, acquisition, development and production company based in Calgary, Alta. The proceeds from the common shares will be used to fund its recently announced acquisition of petroleum and natural gas assets. The flow-through shares will be used to finance Canadian exploration expenses.

ChampionLyte gets $20 million equity line

Sports drink company ChampionLyte Holdings Inc. received $20 million in a standby equity distribution agreement.

The two-year agreement allows the company to draw upon the line at its discretion through the sale of shares.

"While we believe we've made great strides in brand development and distribution, access to these additional capital resources will allow us to further expand our ChampionLyte Sports Drinks and sugar-free syrups brands and help launch our new Be-Lyte low-carb subsidiary," said David Goldberg, the company's president, in a statement. "We also intend on seeking out acquisitions that are complementary to our existing business that will be accretive to earnings."

ChampionLyte is a Miami-based holding company specializing in sugar-free isotonic sports drinks. The funds from the agreement will be used to finance brand development and to fund potential acquisitions.

On Wednesday, the company's stock closed up $0.055 at $0.10.

Introgen raises $16.4 million

Introgen Therapeutics Inc. wrapped a direct placement for $16.4 million.

More than $15 million of the offering was issued to two large European institutional investors.

The offering included 2.47 million shares at about $6.64 each, which were sold under the company's shelf registration.

Merchant bank Mulier Capital is the placement agent in the deal.

Introgen is an Austin, Tex.-based biopharmaceutical company focused on treating cancer and other diseases. The company plans to use the proceeds for additional resources for its Advexin registration program and for other clinical development programs.

On Wednesday, the company's stock closed down $0.05 at $7.65.

MTM closes $12.5 million

Computer and communications technology management company MTM Technologies Inc. raised $12.5 million through the private placement of preferred stock.

The company issued $6.25 million in series A-3 preferreds to Constellation Ventures and $6.25 million in an equity investment from Pequot Ventures.

The offering was the third tranche in an offering for up to $25 million. The preferreds are convertible into 3,846,154 shares at $3.25 each. Warrants were also issued in the deal for 769,231 shares at $4.06 each.

MTM also announced Tuesday its plans to sell Pequot Ventures and Constellation Ventures up to $40 million in 7% convertible secured notes in three tranches.

"The closing of the series A-3 preferred stock investment and the inclusion of an additional quality investor demonstrates the support of our growth strategy," said MTM's chief executive officer Frank Alfano in a statement. "Constellation Ventures has extensive experience in the media and technology fields and we expect that their strong industry relationships will assist us in expanding both our customer base and solution offerings. The additional funding provides us with the capital necessary to continue building a national business and to acquire additional IT solutions-oriented companies."

Based in Stamford, Conn., MTM provides IT networking and data center services. The $12.5 million deal will be used for future transactions. On Wednesday, the company's stock closed down $0.47 at $5.259.

Biomira to raise $10 million

Biomira Inc. has proposed a $10 million placement, the company said Wednesday.

The company will offer up to 3,891,051 shares at $2.57 each. The company will file prospectus supplements to its shelf registrations in the United States and Canada to register the deal.

The pricing of the deal represents a 15% discount to the company's $3.02 closing price for Dec. 7.

The offering includes up to 778,210 purchaser warrants at $0.20 a share for every share purchased in the offering. The warrants allow for an additional share at $3.45 each for three years.

Rodman & Renshaw LLC is the placement agent in the offering.

Based in Edmonton, Alta., Biomira is a biotechnology company specializing in therapeutic approaches to cancer management.

Biomira's stock closed down $0.39 at $2.63 Wednesday.

Conolog secures agreements

Conolog Corp. has received agreements for $4.245 million in a private placement for 1,369,355 shares at $3.10 each.

Investors will also receive warrants for 684,678 shares at $5.15 exercisable beginning June 5, 2005 for five years.

Somerville, N.J.-based Conolog designs and manufactures electromagnetic products to the military and provides engineering and design services to industries, government organizations and public utilities.

The company's stock plummeted $0.78 to close at $3.87 Wednesday.

Sontra closes $4.25 million deal

Sontra Medical Corp. said Wednesday it has raised $4.25 million in a private placement.

About 2.5 million shares at $1.70 each were issued in the offering.

The investors in the offering also received warrants for about 1 million shares at $2.45 each for five years. The warrants may be terminated if, for 20 consecutive trading days, the company's stock is equal to or greater than $4.90.

Franklin, Mass.-based Sontra is a technology company focused on transdermal science.

On Wednesday, the company's stock closed down $0.10 at $1.90.

Shells wraps deal for $2.3 million

Shells Seafood Restaurants Inc. has finished a private placement of convertible debentures and warrants for $2.3 million.

The debentures bear interest at 12% per year and mature either April 5, 2005 or at the closing of an additional round of financing for a minimum of $1.5 million.

The debentures are convertible, at the holder's option, for common shares at a price sold in the contemplated additional financing round.

Investors also received three-year warrants for 1.15 million shares at a price equal to 80% of the price per share determined in the next round of financing, a range limited between $0.45 and $0.80 per share.

Placement agent Casimir Capital LP has the option to increase the size of the offering by $200,000.

"Shells is turning the corner and this additional financing will allow us to more quickly update the appearance and physical condition of several restaurants," said president and chief executive officer Leslie Christon in a statement. "Our customer response to the restaurants we've remodeled to date has been terrific and we're looking forward to bringing this great new look to even more locations.

Based in Tampa, Shells Seafood Restaurants manages and operates 25 seafood restaurants. The company plans to use the funds from the financing to refurbish several restaurants.

On Wednesday, Shell's stock closed unchanged at $0.65 Wednesday.

Farallon plans C$20 million deal

Farallon Resources Ltd. plans to raise C$20 million in a private placement of units.

The company will issue 24,390,244 units at C$0.82 each. The units are comprised of one share and one warrant.

The warrants allow for an additional share at C$1.02 each for two years.

"The deal is priced in line with the market," said one Canadian source.

On Wednesday, the company's stock closed up C$0.02 at C$0.85.

Farallon is a minerals exploration company based in Vancouver, B.C. It plans to use the proceeds from the financing for its Campo Morado polymetallic project in Mexico. The funds will be used for exploration drilling programs, engineering studies and metallurgical tests in 2005 and the remaining funds will be used for general working capital.

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