Private placement market ends week with steady volume, bigger deals; Orbimage raises $32.5 million

By Sheri Kasprzak

Atlanta, Nov. 19 - Private placement volume in the United States was moderate and Canadian volume strong on improved oil prices Friday.

"The markets this week have been really kind of shaky," said one sell-sider in the United States. "Oil today is definitely improving things in the market. We've seen volume improve slightly from yesterday and some bigger deals are even getting done."

Oil prices shot up $2.22 to end the week at $48.44.

"Normally Fridays are pretty slow, volume-wise," said one Canadian sell-side source. "Better oil seems to be driving volume up. But there's also a strong market for resources like gold. We've seen some of those companies in the market today."

Eight Canadian companies made announcements regarding private placements Friday, with Greystar Resources Ltd. leading Canadian news with its upsized C$21.7 million deal.

In the States, Orbimage Inc. stole headlines with its $32.5 million private placement.

The company announced Friday that on Nov. 16 it sold 3.25 million units of one share and one warrant at $10. One million warrants were also issued in the deal exercisable at $10 per share for five years.

Orbimage is a global satellite imaging company based in Dulles, Va. The company plans to use proceeds from the financing to fund its new satellite program, NextView.

The company's stock closed up $0.30 at $15.20 Friday - although the deal was announced after the close.

WPCS wraps $10 million deal

Wireless Professional Communication Services International Inc. sold $10 million through a private placement of shares and warrants, the company said Friday.

On Nov. 16, the company sold to eight investors 25 million common shares and warrants for 25 million shares at $0.40 per share.

The warrants allow for the purchase of an additional share at $0.70 per share for five years.

The warrants are callable any time after the registration statement is effective if, upon 30 days, notice, the company's common stock trades at or above $2.10 for 25 out of 30 consecutive trading days. A maximum of 20% of the warrants may be called in any three-month period.

The deal, according to one sell-sider, is priced "a touch low."

"Its stock closed at $0.60 when the deal closed and it's priced at $0.40," said the source. "The company has traded higher than that. So I think it probably could have priced a bit higher."

On Friday, WPCS's stock closed down $0.02 at $0.49.

Punk, Ziegel & Co. was the placement agent in the offering.

Based in Exton, Pa., WPCS designs, installs and maintains broadband wireless systems. The company is seeking approval to list its shares on Nasdaq's SmallCap market.

Knobias gets $10 million equity line

Knobias Inc. got a $10 million in a standby equity distribution agreement and $1.15 million in a private placement of shares.

The company will sell stock at 98% of its volume weighted average price for five consecutive days to Cornell Capital LLC.

Newbridge Securities Corp. was placement agent in the transaction.

The company also wrapped up a $1.15 million in a private placement of 958,333 series A preferred shares at $1.20 each.

Based in Ridgeland, Miss., Knobias provides research on publicly traded companies. The standby equity distribution agreement and the private placement of convertible preferreds are part of the company's merger with KHI Acquisition Co.

The company's stock closed unchanged a $3 Nov. 18, its last trade.

Genaissance wraps $6 million deal

New Haven, Conn. drug discovery and marketing company Genaissance Pharmaceuticals Inc. received $6 million through a private placement.

The company said Friday it has secured agreements for 3.55 million shares and warrants for 3.55 million additional shares at $1.69 per share.

The company plans to use the proceeds from the deal for general corporate purposes, including the repayment of debt.

On Friday, the company's stock closed down $0.09 at $1.60.

Cardima raises $4.5 million

Cardima Inc., a Fremont, Calif.-based diagnostic products company, wrapped a $4.5 million in a private placement.

The company sold 16,465,423 shares at $0.2733 to accredited investors.

Investors also received four-year warrants for 6.6 million common shares at $0.4295. The warrant are not be exercisable for the first six months after the date of issuance.

Cardima manufactures and produces catheter-based products to diagnose cardiac arrhythmias. The company's stock closed down $0.089 at $0.401 Friday.

e.Digital closes $1.75 million deal

e.Digital Corp. has finished a $1.75 million private placement of convertible preferred stock.

The preferreds pay dividends of 8% per year and are convertible into about 7 million common shares at $0.25 per share.

Investors also got warrants for 3.5 million shares at $0.50 through Nov. 18, 2007.

e.Digital Corp. is a San Diego-based designs and provides digital technology platforms. The company plans to use the proceeds from the deal to develop a new proprietary video/audio technology platform. The remainder of the funds will be used for working capital.

e.Digital's stock closed down $0.025 Friday at $0.235.

Greystar leads Canadians

Heading up Canadian private placement news Friday, Greystar Resources Ltd. closed an upsized C$21.7 million deal.

The company sold 7 million units of one share and one half of one transferable warrant at C$3.10.

Each whole warrant allows for the purchase of an additional share at C$4 per share through Nov. 17, 2006.

Placement agents Jennings Capital Inc. and Oceans Equities Ltd. exercised the greenshoe on the deal for an additional C$3.1 million. On Oct. 26, the deal was announced as a C$18.6 million offering.

Greystar is a gold and silver mining company based in Vancouver, B.C. The company intends to use the proceeds from the financing for the advancement of one of its projects, for exploration and for general working capital.

The company's stock closed down C$0.15 at C$3.20 Friday.

StrataGold in the market again

StrataGold Corp. said late Thursday it will sell C$18.5 million in a private placement, marking the second time this week the company has made a private placement announcement.

The company will sell 3,538,461 flow-through shares at C$0.65 per share for C$2.3 million and 27,931,034 special warrants at C$0.58 for C$16.2 million.

The special warrants are exchangeable for a unit of one share and one half-share warrant per. The full warrants allow for the purchase of an additional share at C$0.70 for one year and C$0.75 for the second year.

Paradigm Capital Inc. and Salman Partners Inc. are placement agents in the offering, which is expected to close Dec. 1.

On Nov. 17, the company closed a C$3.25 million deal, consisting of 6.5 million in subscription receipts to Newmont Mining Corp. of Canada Ltd. for C$0.50 each.

StrataGold is a Vancouver, B.C.-based gold exploration company. The company plans to use the proceeds to fund its Dublin Gulch and Clear Creek acquisitions; exploration in the Aurex, Lynx and Mayo districts; acceleration of drilling at the Tassawini project in Guyana; and general corporate purposes.

The company's stock closed up C$0.01 at C$0.55.

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