Austindo plans $20 million convertible note offering; Veridigm prices $4.5 million of stock

By Sheri Kasprzak

New York, March 5 - Austindo Resources Corp. NL led a light day of PIPE activity Monday as the stock market continued its downward trend.

A market source said Monday that issuers are more wary following last week's stock market tumble, and as the stock market continues to drop, there may be slim pickings for PIPE deals in the coming week.

"Who knows what stocks will do this week," he said. "We're watching and waiting and maybe things will improve. Right now it doesn't look too good."

The Dow Jones Industrial Average gave up 63.69 to close at 12,050.41 on Monday, and the Nasdaq composite index lost 27.32 to end at 2,340.68. The Standard & Poor's 500 composite index slipped 13.05 to close at 1,374.12.

In the Austindo offering, the company plans to sell 10% notes. The five-year notes are convertible into common shares at $0.018263 each, a 15% premium to the company's volume weighted average price for the 20 trading days ended March 1.

The company's stock closed unchanged at A$0.02 on Monday (Australia: ARX).

The proceeds will be used to fund the completion of the company's Cibaliung gold project.

Austock Corporate Finance Ltd. is the placement agent for $5 million of the offering with South East Asian Strategic Assets Fund and adviser CIMB-Standard Strategic Advisors Pte. Ltd. arranging the remainder.

Based in Melbourne, Australia, Austindo is a gold exploration company.

Veridigm prices offering

Moving to the tech sector, Veridigm, Inc. negotiated the terms of a $4.5 million stock offering.

The offering includes up to 30 million shares at $0.15 apiece.

News of the deal sent the company's stock down by a penny to close at $0.17 (OTCBB: VRDG).

The company is conducting the deal to expand subsidiary Megaz Technology Inc.'s operations and continued rollout following an agreement Veridigm entered into with Dimensions Inc. Under the agreement, Megaz will have exclusive, worldwide royalty-bearing license to develop gaming software.

Veridigm also announced Monday that it is creating another subsidiary to broaden its efforts in the electronic health care industry.

Los Angeles-based Veridigm develops technologies used by the health care industry.

Avanex stock closes down

Elsewhere in the tech sector, Avanex Corp.'s stock fell on Monday after sealing a $20 million stock deal on Friday.

The stock dropped by more than 3.5%, or 6 cents, to end at $1.76 and gave up another six-tenths of a cent in after-hours activity. On Friday, the stock closed down 6 cents to settle at $1.82 (Nasdaq: AVNX).

In the placement, a single institutional investor bought shares at $1.8527 each.

In other news, Avanex entered into a share purchase agreement with Global Research Co., a French company, and Didier Savage. Avanex intends to divest its III-V Indium Phosphide and Gallium Arsenide semiconductor fabs and associated product lines in Nozay, France, and transfer 90% of the share capital and voting rights of subsidiary Avanex France to the two purchasers at €1.00. The transaction is set to close in the second quarter.

Based in Fremont, Calif., Avanex develops fiber optic products.

Skystar raises $4.08 million

Looking to the biotech sector, Skystar Bio-Pharmaceutical Co. wrapped a $4.075 million offering of 8% convertible debentures.

A group of institutional and other investors bought the debentures, which are due Feb. 28, 2009 and are convertible at $1.00 each. The investors also received warrants for 4.075 million shares, exercisable at $1.20 each through Feb. 28, 2012.

The debentures may be prepaid at 150% of the principal outstanding plus interest for the first year and at 120% of the outstanding principal plus interest thereafter.

Skystar's stock fell by 2 cents, or 1.23%, on Monday to settle at $1.69 (OTCBB: SKBI).

Pacific Ridge Capital, LLC was the placement agent.

New York-based Skystar develops vaccines, herb-based remedies and microorganisms for livestock in China.

In other biotech news, Upstream Biosciences Inc. secured $2 million from the private placement of 1,333,333 units.

The units - comprised of one share and two warrants - are priced at $1.50 each.

After the offering was announced early Monday afternoon, Upstream's stock went on to drop 8.93%, or 15 cents, to close at $1.53 (OTCBB: UPBS). The losses started early with the stock giving up 7.74%, or 13 cents, by 12:47 p.m. ET.

One of the warrants is exercisable at $1.75 each and the other at $1.85 each.

The first tranche of the deal closed for $1million, and a second tranche is expected to close within the next 30 days.

Proceeds will be used for the company's genetic markers and drug-response assay.

Upstream, based in Vancouver, B.C., develops biomarkers to detect certain types of cancer.

Iomai stock drops

In other biotech news, Iomai Corp.'s stock dipped on Monday after the company closed a $31,883,838 private placement.

The stock fell by 10 cents, or 2%, to end at $4.91 (Nasdaq: IOMI). On Friday, the company's stock gained a penny to end at $5.01 and lost 13 cents in after-hours trading activity.

In the placement, Iomai issued units of one share and two warrants for a total of seven-tenths of a share at $5.0675 each.

The first warrant is exercisable at $5.25 each through March 2, 2012 and the second at $5.25 each for four months after the registration statement is effective.

Cowen & Co., LLC was the placement agent.

Proceeds will be used for working capital.

Based in Gaithersburg, Md., Iomai develops transcutaneous vaccinations.

Antares stock also slips

Another drug-delivery technology developer, Antares Pharma, Inc., saw its stock fall on Monday after releasing the terms of a loan with warrants for $10 million on Friday.

The stock gave up 4 cents, or 3.5%, to settle at $1.11 (Amex: AIS). After the deal was announced Friday, the stock dropped by 3 cents to close at $1.15.

MMV Financial, Inc. funded the private placement, which will be settled in two tranches of $5 million each.

MMV received warrants for 640,000 shares in the deal, exercisable at $1.25 each.

Based in Ewing, N.J., Antares develops drug-delivery platforms.

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