Private placement volume holds steady; Vineyard National Bancorp raises $15 million

By Sheri Kasprzak

Atlanta, Dec. 9 - The private placement market got a boost Thursday from higher oil prices and a better stock market.

On Thursday, oil prices rose $0.59 to end at $42.53 per barrel on word from the world's oil producers that limited oil production could mean higher oil prices for the next several years.

"Oil was up, stocks were up, and those are both good conditions for this market," said one sell-side source. "Tech stocks are a bit weaker, so we didn't really see a lot of tech companies jumping at the chance to do private placements today."

The Dow Jones Industrial Average closed up 5.17 Thursday at 10,499.4, Nasdaq was up 3.41 to close at 2.122.7 and the S&P 500 inched up 0.71 to end the day at 1,183.53.

Heading up action in the United States, Vineyard National Bancorp, which announced Thursday that it secured agreements for a $15 million private placement.

The company sold 483,100 shares at $31.05 each and investors also got rights to buy an additional 120,775 shares at $31.05 for 90 days.

RBC Capital Markets is the placement agent in the offering.

"This deal looks like it's priced a little low to me," said one market source. "It could have gone maybe a dollar or more higher to be closer to the range the company's been trading."

On Thursday, the company's stock closed down $1.14 at $32.65.

Throughout December, the company's stock has ranged between $32.65 and $34.65.

"Maintaining a strong financial position and strong capital ratios continue to be Vineyard's commitment in building a successful organization," said Vineyard's president and chief executive officer Norman Morales in a statement. "This transaction will allow us to do so while supporting our continued growth consistent with our strategic business plan. Our placement of the company's stock to independent institutional investors in our last capital offering has already increased our liquidity and daily trading volume."

Vineyard, based in Rancho Cucamonga, Calif., is a bank holding company operating nine banking centers in California. The company plans to use the proceeds from the deal for general corporate purposes.

Silver Star gets equity line

Silver Star Energy Inc. said Thursday it has received a standby equity distribution agreement from Cornell Capital Partners LP for $10 million.

Cornell will pay 100% of the lowest volume weighted average price as quoted on Bloomberg during five consecutive trading days following the notice for each share of stock bought under the agreement.

Silver Star also received $750,000 from a convertible debenture at the initial closing with a second tranche of $750,000 payable upon the filing of a registration statement. Cornell will receive 10% from each tranche.

The three-year debenture accrues interest at 5% per year and is convertible into shares at 100% of the lowest closing bid price for three trading days before the conversion date.

Monitor Capital Inc. was the placement agent in the offering.

Silver Star is a Los Angeles-based oil and natural gas exploration and development company.

On Thursday, the company's stock closed down $0.015 at $0.975.

PacificNet raises $7.5 million

PacificNet Inc. received definitive agreements for a $7.5 million private placement.

Investors in the deal received 1 million shares at $7.50 each and warrants for up to 350,000 at $12.21, a 125% premium to the company's closing stock price on Dec. 8.

"We believe that this investment reflects the growing confidence of institutional investors in PacificNet, our management team and our overall China business strategy," said PacificNet's president Victor Tong in a statement. "We look forward to establishing a long-lasting synergistic relationship with our investors in the future."

PacificNet is a Hong Kong-based internet technology service provider. It plans to use the proceeds from the deal to expand its telecom value-added services, business process outsourcing, call center and customer relationship management operations and other acquisitions in China.

The company's stock closed down $0.57 at $10.82 on Thursday.

Hawaiian Airlines holding company wraps deal

Hawaiian Holdings Inc. wrapped up a private placement for proceeds of $3,737,500.

On Dec. 8, the company sold 650,000 shares at $5.75 each.

Based in Honolulu, Hawaiian Holdings is a Hawaiian airline company.

The company's stock closed down $0.02 at $6.48 Thursday.

Quepasa plans $3.125 million deal

Quepasa Corp. will raise up to $3.125 million in a private placement, the company said Thursday.

The company plans to offer 500,000 units at $6.25 each. The units are comprised of two shares and four-tenths of a purchase warrant.

The whole warrants allow for an additional share at $4.50 each for two years.

On Dec. 3, the company sold 328,000 shares. The company is currently finalizing cash receipts and subscription documentation for the remaining units in the offering.

Quepasa is a Phoenix-based internet search engine provider for Latin American consumers. On Thursday, the company's stock closed down $0.06 at $4.39.

SinoFresh wraps deal for $1.8 million

SinoFresh HealthCare Inc. completed a private placement for $1.8 million in convertible debentures.

The company sold the senior secured 6% convertible debentures to current, private and institutional investors.

Chief financial officer Scott Klein said Thursday additional details on the deal will be released in a form 8-K filed with the Securities and Exchange Commission on Dec. 10.

"We used Bristol Investment Group as our placement agent," Klein said in an interview. "Our two primary reasons for selecting this type of transaction was to avoid monthly principal payments and to lock in to a fixed conversion price, thereby not falling into a potential death spiral from possible decline in our stock price."

Based in Englewood, Fla., SinoFresh develops and markets an over-the-counter nasal spray that kills bacteria and fungi. The company plans to use the proceeds to pay off current senior secured debt and to meet the costs of general business operations. The offering was arranged to support the company's 2005 marketing and media plan.

On Thursday, SinoFresh's stock closed down $0.05 at $0.70.

Lexon raises $1.7 million

Lexon Technologies Inc. wrapped up a private placement for $1.7 million.

The company issued 10,125,000 shares at about $0.16 a share to two individual investors.

Kyoung Ho Lim purchased 4 million of the shares and Young Hee Lee bought 6,125,000. A consultant in the offering, Joon Ho Chang, also received 1 million shares.

Based in Dublin, Pa., Lexon is a technology transfer company focused on developing and marketing technology for security, defense, law enforcement and humanitarian purposes.

The company's stock closed unchanged at $0.12 Thursday.

SunCoast closes $2.84 million deal

SunCoast Bancorp Inc. has raised $2,838,750 in convertible preferred stock.

The preferreds are convertible into about 227,100 shares at $10.50 each and pay dividends of 6% each year, payable Dec. 31, 2005 and Dec. 31, 2006.

The final closing of the offering is scheduled for Dec. 31.

Based in Sarasota, Fla., SunCoast is a holding company for SunCoast Bank, which has two branches in Sarasota. The company intends to the proceeds from the financing for general corporate purposes and working capital.

On Thursday, the company's stock closed up $1.05 at $13.05.

Tri-Valley sells $2.5 million in shares

Tri-Valley Corp. said Thursday it raised $2.5 million in a private placement.

On Dec. 8, the company issued 500,000 shares to an individual buyer at $5 per share.

Based in Bakersfield, Calif., Tri-Valley is a petroleum and mineral exploration and production company.

The company's stock closed up $0.03 at $7.47 on Thursday.

China World gets $1.45 million

China World Trade Corp. has received $1.45 million from the second closing of a private placement.

One Dec. 3, the company sold 966,667 shares at $1.50 each.

Investors in the deal also received 483,334 series A warrants, which allow for an additional share at $2.50 each for five years.

The company also issued each investor an option to buy 966,667 shares at $3 each. Upon exercise of the option, the investors will receive series B warrants for 50% of the firm's shares at $4 each for five years.

Duncan Capital LLC was the placement agent in both deals.

Based in Guangzhou, China, China World Trade operates business clubs in China.

On Thursday, the company's stock closed up $0.13 at $2.58.

Trend to raise $2 million

Trend Mining Co. raised about $250,000 in a secured convertible debt financing for up to $2 million.

The company expects to raise another $1.75 million from the financing in 10 days.

Trend will issue convertible promissory notes for about $2 million. The notes bear interest at 10% per year and will be amortized over three years.

The notes are convertible into shares at $0.30 each.

Trend, a Denver-based precious-metals exploration company, plans to use the proceeds to pay off existing trade accounts payable and to fund exploration work on its mineral projects in North America.

The company's stock closed unchanged at $0.28 Thursday.

Canadian deals

Cathedral Energy Services Income Trust led private placement action in Canada Thursday with its announcement that it plans to raise C$6 million.

The company will issue 2 million trust units at C$3 each.

The deal is being placed through a syndicate of underwriters led by Harris Partners Ltd. The syndicate has the option to increase the offering before closing by 1,333,333 units for total proceeds of C$10 million.

Cathedral is a Calgary, Alta.-based limited-purpose trust, which owns the securities of Cathedral Energy Services Ltd. The company plans to use the proceeds from the financing for general working capital.

Cathedral's stock closed unchanged at C$3.14 Thursday.

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