MDI raises $2.3 million from stock sale; DataLogic wraps $1.63 million offering

By Sheri Kasprzak

New York, May 24 - As technology stocks made a comeback over the past two sessions, two tech names led PIPE activity Wednesday.

"Tech has been off for a while now, but it seems to be turning around," said one sellside market source familiar with the technology sector. "We're seeing some [technology] companies doing PIPEs here and there. It's too soon to tell really [if this is a trend]."

Stocks in general turned around after taking a dip early in the session with the Dow Jones Industrial Average climbing 18.96 to close at 11,117.32.

The Nasdaq composite index gained 10.41 to close at 2,169.17 and the Standard & Poor's 500 composite index ended the day up 2.00 at 1,258.57.

Moving to specific offerings Wednesday, MDI, Inc. wrapped up a $2.3 million private placement.

The company sold 2,875,000 shares at $0.80 each to several existing institutional and other investors including Feldman Weinstein LLP and Crestview Capital Master, LLC. The investors received warrants for 1.15 million shares, exercisable at $1.02 each for five years.

The Shemano Group was the placement agent for the deal.

"We are pleased to announce this financing as a testament to both the success in executing our business strategy thus far and the tremendous potential we see moving forward," said J. Collier Sparks, chief executive officer of MDI, in a news release. "Our market is projected to grow significantly in the coming years. MDI, already recognized throughout the industry as the leader in our space, is well-positioned to capture this growth opportunity.

"Today's announcement reflects the continued support of our core investors, as well as the growing relationship with our most recent investors. The proceeds received from completing this latest financing provide for a stronger balance sheet by enhancing our shareholders' equity and [providing] working capital that will assist us in the continued execution of our business plan."

At the end of the day, the stock remained unchanged at $0.85 (Nasdaq: MDII).

The company on May 15 reported a net loss of $1.4 million for the quarter ended March 31, compared with a net loss of $1.75 million for the same quarter of 2005.

Based in San Antonio, MDI produces security software, hardware and video systems.

DataLogic's $1.63 million deal

Elsewhere in technology, DataLogic International, Inc. concluded a $1,625,000 private placement.

The stock finished off 9.56%, or 2 cents, to end the session at $0.19 (OTCBB: DLGI).

DataLogic sold to a group of institutional and accredited investors 8,125,000 shares at $0.20 each. The investors also received warrants for 3.25 million shares, exercisable at $0.35 each and warrants for 2,031,250 shares, exercisable at $0.45 each. The warrants expire Nov. 23, 2011.

Midtown Partners & Co., LLC was the placement agent.

"We are pleased to have successfully completed this private placement and as a result we have improved the strength of our balance sheet," said Keith Moore, DataLogic's CEO, in a statement. "Lowering the cost of capital is a significant strategic objective for 2006 and this raise, which follows the refinancing of our convertible debt in January 2006, completes the next phase of our corporate development plans. As we move through 2006 we will look to implement strategies to improve cash flows."

Based in Irvine, Calif., DataLogic develops global positioning system-based mobile asset tracking used by governmental agencies and commercial concerns.

Birim's C$6.75 million deal

As gold and copper prices fell after reaching historic highs earlier this month, Birim Goldfields, Inc. negotiated a C$6.75 million non-brokered PIPE.

Gold prices fell to $637.50 per ounce on Wednesday with copper dropping off as well. Other mineral prices also fell, which will impact Canadian PIPE activity for the rest of the week, one Canadian sellside market source said.

"Oil's off, gold's off, and that's impacting other minerals," said the market source. "Those things make up the big portion of [PIPE offerings] here."

In the Birim offering, being conducted as part of the company's strategic alliance plans with Australian gold explorer Troy Resources NL, the company plans to sell 12,272,727 units at C$0.55 each.

Each unit includes one share and one half-share warrant. The full warrants are exercisable at C$0.80 each for 18 months.

Troy Resources intends to purchase 5 million units in the offering for C$2.75 million.

Under the terms of the strategic alliance, Troy and Birim will jointly explore and develop gold projects in Ghana.

Proceeds will be used for exploration on the company's properties in Ghana and for working capital.

On Wednesday, the stock closed down 1.96%, or a penny, to close at C$0.50 (Toronto: BGI).

"The funds raised in the current financing will ensure that Birim will be capable of sustaining an aggressive work program, including extensive drilling, on multiple targets already defined on its Bui and Sefwi properties," said Vic King, Birim's president, in a statement. "We are particularly pleased with Troy's significant participation in this financing and look forward to co-operating within the strategic alliance. This brings together Troy's highly regarded reputation for rapidly developing, profitable, low-cost mining operations with Birim's considerable exploration experience and quality property portfolio in Ghana."

"This represents Troy's first investment in the West Africa region, exposing Troy to the significant exploration potential of Birim's extensive tenement positions in Ghana," said Tommy McKeith, Troy's CEO, in the statement. "We look forward to developing the strategic alliance with Birim, a well-established explorer in Ghana, through its high-quality people and prospective exploration portfolio."

Montreal-based Birim is a gold and base metal exploration company.

Caribou stock falls 4.3%

Moving to energy news, Caribou Resources Corp.'s stock dropped on Wednesday as oil prices dipped by $1.90 to end at $69.86 per barrel.

The stock fell 4.26%, or 10 cents, to wrap up at C$2.25 (TSX Venture: CBU).

On Tuesday, when the company's C$8 million private placement was announced, the stock dipped by a penny to close at C$2.35.

In the placement, the company plans to sell shares at C$2.30 each and flow-through shares at C$3.05 each.

A syndicate of underwriters led by Acumen Capital Partners Ltd. has a greenshoe for up to C$2 million.

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

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