Vonage raises debt for buyback; NutraCea plans deal; Coeur d'Alene closes sale; Aquiline amends terms

By Kenneth Lim

Boston, Oct. 20 - Vonage Holdings Corp. placed $18 million of convertible third lien notes as part of a larger financing deal to complete the buyback of its outstanding convertible notes.

NutraCea plans to raise $5 million from a convertible placement that the company said will provide working capital for all its projects.

Coeur d'Alene Mines Corp. closed a $50 million offering of convertible notes to fund a silver and gold project in Mexico, while Aquiline Resources Inc. sweetened the terms on its C$10 million offer of units.

Vonage buys back securities

Vonage plans to place $18 million of 20% convertible senior secured third lien notes due October 2015 with Silver Point Finance, LLC and other affiliates as part of a convertible buyback exercise.

The company is also taking on a $130.3 million senior secured first lien credit facility and a $72 million senior secured second lien credit facility to fund the buyback of $253.5 million of its 5% senior unsecured convertible notes due 2010, which are putable in December 2008.

The new convertibles will have an initial conversion price of $0.29 per share, representing a discount of about 64.6% compared to Vonage's closing stock price on Oct. 17. Vonage common stock (NYSE: VG) closed at $0.78 on Monday, lower by 4.88% or $0.04.

The proceeds of will be used to repurchase up to $253.5 million of the company's existing convertible notes in a tender offer. The tender was first offered on July 30, and is expected to expire Nov. 30, 2008.

Holmdel, N.J.-based Vonage Holdings is a provider of broadband telephone services.

"Today's agreement represents a significant milestone in positioning Vonage for the future," Vonage chief financial officer John Rego said in a statement. "This agreement provides the company with the financial stability to focus on increasing profitability while continuing to provide customers with innovative, feature-rich phone service. We are pleased to reach definitive agreement on this refinancing at a time of unprecedented volatility in the credit markets. This agreement provides clarity to our partners and suppliers regarding the company's liquidity position in these challenging financial times. We are eager to focus on improving the fundamentals of the business to deliver profitable growth."

NutraCea to raise $5 million

NutraCea plans to place $5 million of 8% series D convertible preferred stock with two investors in a registered direct offering.

The $1,000 par preferreds will be sold as part of units that comprise one convertible preferred and one warrant. Each preferred has an initial conversion price of $0.55, while each warrant grants the option to purchase 909.09 common shares at an exercise price of $0.55 per share.

NutraCea common stock (OTCBB: NTRZ) declined by 4% or $0.02 to close at $0.48 on Monday.

The investors also received 60-day warrants to buy an additional $5 million of the convertible preferred-and-warrant units on the same terms as the initial issuance.

The company also announced that it had obtained a $10 million credit facility from Wells Fargo Bank that bears interest at prime plus 250 basis points to prime plus 300 bps.

The proceeds will be used to provide working capital required to complete all the projects that it currently has under construction.

Based in El Dorado Hills, Calif., NutraCea researches and produces stabilized rice bran and derivatives.

"Given the current economic environment and the effect it is having on companies' ability to access the capital markets, we were pleased to obtain this loan facility proposal with Wells Fargo, as well as additional funds through a preferred offering," NutraCea chief executive and president Brad Edson said in a statement. "This financing will provide the working capital necessary to complete all projects that we currently have under construction."

"We are moving forward with our first China based production facility," he added. "The first phase of development in China is anticipated to require less than 15% of the total capital required. The balance of the financial commitment can be done in tranches over a period of up to two years. Currently, we expect construction in China to begin during the first quarter of next year."

Coeur d'Alene raises $50 million

Coeur d'Alene placed $50 million of floating-rate senior secured convertible notes due Oct. 15, 2012 in a direct sale.

Each note bears interest at Libor plus 750 basis points, subject to a floor of 9% and a cap of 12%.

The investor also received a warrant for an additional $25 million in notes, exercisable between Feb. 7, 2009 and March 9, 2009.

The notes are convertible into common shares of at $1.15 per share. Coeur d'Alene common stock (NYSE: CDE) lost 4.3% or $0.04 on Monday to close at $0.89.

Proceeds will be used to fund continued development of the Palmarejo silver/gold project in Mexico and for general corporate purposes.

Coeur d'Alene is an Idaho-based silver and gold producer with mining interests in Alaska, Nevada, Argentina, Australia, Bolivia, Chile and Tanzania.

Aquiline lowers price

Aquiline Resources lowered the per-unit cost of its C$10 million non-brokered private placement to reflect current market conditions.

The company will now sell 5 million units of one common share and one warrant at C$2 per unit. The deal originally priced Oct. 9 for 4 million units at C$2.50 per unit. The warrants are now exercisable at C$2.50 for three years instead of C$3 for five years.

Proceeds will be used for exploration and development.

Toronto-based Aquiline is a gold and silver exploration and development company.

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