Strike raises A$31.98 million; MedX sells units; Monument aims for production; InterOil sells convertibles

By Kenneth Lim

Boston, May 13 - Strike Resources Ltd. said it raised A$31.98 million in a heavily over-subscribed stock placement that it will use to develop its projects in Peru.

Meanwhile, MedX Health Corp. said it is selling C$2 million of stock-and-warrant units in a private placement.

Monument Mining Ltd. plans to raise about C$38 million from a placement of units and a convertible credit facility to take it into production in 2009.

InterOil Corp. said it closed a $95 million placement of 8% subordinated convertible debentures due 2013 that have an initial conversion price at a discount to market.

Strike completes deal

Strike Resources said it sold A$31.98 million of common stock in a private placement to Australia-, U.K.- and U.S.-based institutional and professional clients of BBY Ltd.

The company sold 13.05 million shares at A$2.45 each. Strike common stock (ASX: SRK) closed at A$2.53 on Tuesday, up by 4.98%, or A$0.12.

Strike, a resource exploration company based in Perth, Australia, said it will use the proceeds to further develop its Peruvian iron ore projects.

"BBY has advised the company that the issue was heavily over-subscribed, with strong domestic and international support being received," Strike said in a statement. "The company is pleased that ... there is now a growing number of significant institutional investors on its share register, who support the company and its operations moving forward."

MedX to sell units

MedX Health said it is selling C$2 million of stock-and-warrant units in a private placement.

Each unit will comprise one common share and one half-share warrant, with each warrant exercisable for two years. The pricing of the units and the warrants will be determined later.

MedX common stock (TSX: MDX) rose 9.09%, or C$0.025, to close at C$0.30 on Tuesday.

MedX, a Mississauga, Ont.-based maker of phototherapy medical devices, said it will use the proceeds for working capital, for debt repayment and for operational requirements. Those operational requirements include expanding its distribution network, marketing, product development and research and development.

"These additional funds will further accelerate our product development and international marketing program," MedX president Steve Guillen said in a statement.

Monument to raise C$38 million

Monument Mining said it is selling C$28 million of units in a non-brokered placement.

Each unit will comprise one common share and one warrant and will be sold at C$0.40 per unit. Each whole warrant will be exercisable at C$0.50.

Monument Mining common stock (TSX: MMY) closed unchanged at C$0.45 on Tuesday.

Monument Mining is also planning to take on a convertible credit facility for up to C$10 million with a three-year term and interest at 3%. Monument would draw down at least C$6 million by Dec. 31 to fund its development work.

The credit facility will be convertible into units of one share and one half-share warrant, the three-year warrants being exercisable at C$0.75 in the first two years and at C$0.83 in the third year. The conversion price on the facility is to be C$0.40 per unit for funds drawn down by Dec. 31

Proceeds will be used to complete construction on the company's Malaysian Gold Mine Project, to advance exploration programs and to discharge an existing C$9 million debt.

Monument is a mining company based in Vancouver, B.C.

In a statement, Monument said it expects that the financing will fund all its requirements until it enters into production in the first half of 2009.

"The completion of this financing will be a milestone for the company to move to the construction stage," Monument president and chief executive Robert F. Baldock said in the statement. "The construction period of the treatment plant facility under current market conditions is expected to be completed within a year of commencement and a positive cash flow will be generated from commercial gold production thereafter, with no further funding requirement expected from the capital markets in the foreseeable future."

"Such cash flow is expected to provide adequate funding for an aggressive but focused exploration program on the company land inventory and elsewhere and to retire its convertible note obligations," Baldock added. "The company believes that the exploration potential for the region is significant, based on the data base of preliminary exploration results it has acquired and the land inventory package now held or being acquired adjacent and nearby to its presently planned production facility."

InterOil places convertibles

InterOil said it completed a $95 million private placement of five-year 8% subordinated convertible debentures.

The deal settled on May 9.

The debentures are convertible into common shares at $25.00 per share, almost a 10% discount to the common stock's May 9 closing price of $27.19. InterOil stock (Amex: IOC) ended Tuesday at $27.20, down by 4.29%, or $1.22.

If the daily volume-weighted average price of the company's common shares equals or exceeds $32.50 for at least 15 consecutive trading days, InterOil may force conversion. InterOil may also be required to repurchase the debentures in cash at 101%, plus interest, upon the occurrence of certain change-of-control events.

Proceeds will be used to repay debt under the company's credit facility with Merrill Lynch Capital Corp. InterOil will use any remaining proceeds to drill and develop oil and gas wells on the Elk/Antelope structures in Papua New Guinea and for general corporate purposes.

InterOil is an oil and gas company with headquarters in the Woodlands, Texas.

An outright convertible analyst said the deal sold to a small number of investors.

"I haven't seen it, and I don't expect to," the analyst said. "This is one of those small deals that they place out to just a few people, and those people are probably insiders or investors who are close to the company. None of them are going to trade these, and they'll probably convert them. These kinds of deals are meant to be converted. The conversion price is below the stock, why wouldn't you want to convert at some point?"

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