Fonix brings $2.4 million preferreds; Continental Energy wraps $3.25 million; Global Wataire sets $10 million deal

By LLuvia Mares

New York, Aug. 30 - Fonix Corp. announced Thursday a $2.4 million offering of series N 9% convertible preferred stock.

The company will sell 2,400 shares of preferred stock at $1,000 per share to various investors including lead investor Trillium Partners, LP.

The stock is convertible into shares of the company's class A common stock at a conversion price of 80% of the two lowest closing bid prices over the 20 trading days prior to the conversion date.

In addition to the sale the company also signed a settlement agreement resolving litigation with the Breckenridge Fund, LLC Thursday.

The company paid Breckenridge $343,000 and will pay an additional $250,000 on Sept. 7 and $707,000 on Nov. 27.

Salt Lake City, Utah-based Fonix specializes in speech recognition and text-to-speech technologies.

Continental closes $3.25 million placement

Continental Energy Corp. announced it completed a $3.25 million private equity placement.

The company issued 5 million common shares at $0.65 each. The placement also included 10 million in warrants with an exercise price of $0.90 per share for three years.

"We are very pleased to have Macquarie as our first major institutional investor. Macquarie has an outstanding reputation as an innovative investment banker and a major player in international oil and gas mergers, acquisitions and project finance," said Richard L. McAdoo, company president in a press release.

"The $100 million financing mandate will, if brought to fruition, provide us the all important war chest to back up our new ventures, acquisitions, and Bengara-II development and thereby move Continental from an exploration to a development stage company."

When exercised, the warrants will provide an additional $9 million in proceeds. The total in common shares and warrants will represent 19.4% of Continental's outstanding share capital.

A company insider said that due to Continental Energy's small size a private placement deal sounded more appealing than any other type of financing structure.

"We did the dance with a number of New York financing institutions offering us some deals but decided to go with this private placement," he said. "It's simple, clean and it will also put more money in our back pocket, if the warrants are exercised and the stock increases."

Macquarie's Energy Capital Group in London and Macquarie Bank Ltd. acted as placement agent.

Proceeds will be used to support further development of the company's Bengara-II Block oil and gas interests and to purchase and develop additional international oil and gas interests.

"We are searching for the big elephant," said the insider. "A big oil field and we hope to find it in Indonesia."

Macquarie's Energy Capital Group executed a mandate letter stating it will arrange additional financing up to $100 million for the company in form of senior secured credit, hedging and equity facilities, depending on technical and commercial due diligence.

The company insider said now that the private placement has been completed the company will start looking into other deals, specifically production acquisitions.

"Our weakness as a small company is revenue stream for production," he said.

Dallas-based Continental Energy is an international oil and gas exploration company, focused on making oil or gas discoveries in Indonesia.

Global Wataire $10 million investment

Global Wataire Inc. announced Thursday a $10 million investment agreement for long term expansion capital.

Dutchess Private Equities Fund, Ltd. agreed to purchase up to $10 million of the company's common stock over the course of 36 months at 93% of the lowest closing bid price.

The company can request each purchase be equal up to $250,000 or 200% of the average daily volume of the common stock for the ten trading days prior to the notice date.

Buffalo, N.Y.-based Global Wataire provides advisory and transactional services to business owners.

Central European completes $110 million deal

Central European Media Enterprises Ltd. completed a $110 million sale of class A common stock.

Igor Kolomoisky, a Ukrainian businessman purchased 1,275,227 shares. The price per share will be determined on the average trading price. No warrants were attached to the transaction.

"We are convinced that in the next few years Ukraine will become the largest market in which we operate," said Michael Garin, the company chief executive officer in a news release.

"We remain completely committed to Ukraine and will continue to aggressively but prudently pursue opportunities to further strengthen our presence there. Today's announcement is a major indicator of that commitment.

"Investors should welcome this step as a major vote of confidence. The Apax investment last year underscored their view of the growth potential of CME as a company."

The shares represent 3.0% of the company's outstanding common stock. In connection with the investment, Kolomoisky will be named to the board of directors.

"CME is one of the fastest growing and best managed media companies in the world and represents an exceptional investment opportunity for me. I am impressed with the company's management team, vision and disciplined financial approach," said Kolomoisky in a press release.

"I look forward to working with my new board colleagues and the CME management team to build upon the CME success story at a time when prospects are so bright both in Ukraine and in the other markets in which the company operates."

London-based Central European Media provides television broadcasts in Central and Eastern Europe.

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