NeoMedia pockets $27 million from preferreds; BioSphere secures $14.53 million in stock sale

By Sheri Kasprzak

New York, Feb. 21 - NeoMedia Technologies Inc. settled a $27 million private placement of convertible preferreds, heading up PIPE activity as the markets reopened following a three-day weekend.

The preferreds were sold to Cornell Capital Partners, LP.

The offering comes on the heels of several acquisition announcements from NeoMedia.

On Tuesday, NeoMedia announced its plans to acquire Gavitec AG, a German mobile technology company, and on Friday, the company concluded its acquisition of Mobot, Inc., a Lexington, Mass.-based mobile visual recognition technology developer. The company also announced its intention to acquire HipCricket, Inc. on Friday.

The Mobot acquisition cost the company $10 million in cash and stock. The Gavitec acquisition will close by the end of the month and is expected to cost $7.2 million. And the HipCricket acquisition is expected to cost $4.5 million in cash and shares of stock and is slated to close in 90 days.

The company's stock advanced more than 2% on Tuesday, gaining $0.009, to end at $0.398 (OTCBB: NEOM).

Under the terms of the placement, Cornell bought series C convertible preferreds, $3,208,702 of which were issued to cancel that amount in principal of 8% convertible notes. The preferreds are initially convertible into 100 million common shares at $0.27 each.

As of Nov. 9, NeoMedia had 463,382,141 outstanding shares.

Cornell received warrants for 75 million shares. Of those, 20 million shares are exercisable at $0.50 each for five years; 25 million shares at $0.40 each for five years; and 30 million shares at $0.35 each for five years.

Proceeds will be used for general corporate purposes.

In its most recent earnings report, NeoMedia had reported a net loss of $1.95 million for the quarter ended Sept. 30, 2005, compared with a net loss of $1.44 million for the same quarter of 2004.

Based in Fort Myers, Fla., NeoMedia, operating under the PaperClick brand name, develops technologies used to link information to the internet.

BioSphere's $14.53 million deal

In the biotech sector, BioSphere, Inc. announced the imminent closing of a $14,525,000 private placement of stock.

The offering, announced Tuesday morning, sent the company's stock down 12 cents, or 1.57%, to close at $7.51 (Nasdaq: BSMD).

The deal, which is scheduled to close on Wednesday, includes 2,075,000 shares at $7.00 apiece, offered to a group of institutional investors.

Based in Rockland, Mass., BioSphere is a medical device company focused on developing bio-engineered microspheres used to treat uterine fibroids, hypervascular tumors and vascular malformations.

The BioSphere deal is one of many biotech offerings that have surfaced in the PIPE market over the past week. That activity may be short-lived, according to one buysider.

"The biotech stocks are off this week, but perhaps other investors (not us), feel bullish about the sector as a whole," said the Boston-based buysider. "We are a bit more conservative right now and feel that the market will go down before it goes up."

Verso raises $7.02 million

In the tech sector, Verso Technologies, Inc. settled a $7.02 million private placement of units.

A group of institutional and accredited investors bought 5.4 million units at $1.30 each. The units consist of one share and one warrant. Each warrant is exercisable at $1.56 each for five years.

"We are very proud to have completed this private placement on our own and in a very quick and efficient manner," said Steve Odom, the company's executive chairman, in a news release. "We priced this deal on Feb. 10, 2006 at what we believe was a fair value, with the common stock portion of the unit priced at a discount and the warrant portion of the unit priced at a premium.

"The demand for the offering was very strong; so much that we had to turn down additional capital. We had strong interest among existing shareholders, including two of our largest institutional investors. We believe the completion of this financing enables us to fund our growth initiatives and to refocus 100% of our efforts on running our business."

The company plans to discuss the capital raising effort in more detail when it reports fourth-quarter 2005 results 5 p.m. ET on Wednesday.

Verso's stock slipped 9 cents, or 5.52%, to close at $1.54 Tuesday. In after-hours trading, the stock gained a penny (Nasdaq: VRSO).

Verso, based in Atlanta, is a communications company for carriers and service providers.

Kimber prices two deals

In Canadian offerings Tuesday, Kimber Resources Inc. priced two deals totaling C$9.9 million.

The first deal is a non-brokered offering of 3.8 million shares at C$2.00 each. That deal is being geared toward Canadian institutional and accredited investors.

The second, a brokered deal, will be offered to U.S.-based accredited investors.

The brokered deal includes 1.15 million shares at C$2.00 each. The price per share is an 8.8% discount to the five-day average closing price of the company's stock immediately before pricing.

The pricing terms were announced Tuesday morning, sending the company's stock down by more than 10% before noon ET. Ultimately, the company's stock lost 20 cents, or 8.33%, to finish at C$2.20 (Toronto: KBR).

Proceeds will be used for drilling on the company's Carmen and Carotare deposits and on the El Orito Norte exploration target. The rest will be used for general corporate purposes.

Based in Vancouver, B.C., Kimber is a gold and silver exploration company.

In other resources offerings, SNL Enterprises Ltd. priced a unit offering for up to C$4.2 million.

The non-brokered deal includes up to 2 million non flow-through units at C$1.00 each and up to 2 million flow-through units at C$1.10 each.

The non flow-through units are comprised of one share and one half-share warrant, the whole of which is exercisable for one year at C$1.75 each.

The flow-through units consist of one share and one half-share warrant. The whole warrants are exercisable under the same terms as warrants associated with the non flow-through units.

Proceeds will be used for exploration expenses, commitments for two option agreements in the Skeena Mining Division and working capital.

On Tuesday, the company said it acquired the Copper Pendant property. The company also entered into two option agreements to acquire 50% interest in 19 mineral tenures in the Skeena Mining Division in British Columbia.

Each agreement costs C$200,000 in cash and 1.1 million in stock. For the acquisitions, SNL will incur property expenses of C$1.2 million for two years.

SNL's stock slipped 8.7% Tuesday, or 10 cents, to end at C$1.05 (TSX Venture: SNL).

Vancouver, B.C.-based SNL is a mineral exploration company.

TransTechnology stock gains 13.2%

TransTechnology Corp.'s stock jumped more than 13% Tuesday after the company settled an $18.75 million private placement offering Friday.

The stock advanced 93 cents to end at $7.98 Tuesday (Pink Sheets: TTLG).

On Friday, when the offering closed, the company's stock gained 5 cents, or 0.71%.

In the placement, the company issued shares at $7.50 each to institutional investors.

Union, N.J.-based TransTechnology operates under the name Breeze-Easter and designs lifting devices for military and civilian aircraft.

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