Cadence raises enough for a year; Emcore upsizes offering; Sherwood, Firstgold plan placements

By Kenneth Lim

Boston, Feb. 15 - Cadence Pharmaceuticals Inc. sold $49.34 million of its stock in a direct offering that the company said will last it for at least a year.

Emcore Corp. announced a planned private placement of shares and warrants and then upsized it by $6 million to $100 million, and said it will use the proceeds for an acquisition and working capital.

Meanwhile, Sherwood Copper Corp. announced plans to raise C$7.2 million through a non-brokered private placement of flow-through shares, while Firstgold Corp. said it would sell between $11 million and $14 million of convertibles, stock and warrants.

Cadence raises for year

Cadence Pharmaceuticals said its $49.34 million private stock offering should last it for at least the next 12 months.

Cadence (Nasdaq: CADX), a San Diego, Calif.-based biopharmaceutical company, said it sold 9.24 million common shares at $5.34 apiece, its closing stock price on Thursday. Settlement is expected on Feb. 20.

The buyers in the deal comprised new investors as well as existing stockholders, including funds affiliated with Domain Associates LLC, Frazier Healthcare V LP, Versant Ventures II LLC, the company said in a filing with the exchange. Company officers that also bought more stock were chairman Cam L. Garner, director Christopher J. Twomey and president and chief executive Theodore R. Schroeder.

"It's a very nice affirmation of their support and commitment to the company," Cadence chief financial officer Bill LaRue told Prospect News.

The proceeds of the deal will be used to further develop and commercialize Cadence's late-stage drugs, and should be able to meet operating requirements for at least a year, the company said.

"What we wanted to do was to ensure that we have the appropriate resources to complete the development of both of our late-stage programs," LaRue said. "We've announced earlier that we will be financing in 2008, and this is just part of those plans. We felt that the amount is appropriate to allow us to complete those programs."

Cadence in the past has raised money through venture capital, placements and its initial public offering, and the latest fundraising's structure reflects "the capital which is available," LaRue said.

"We haven't gone with convertible debentures at this time," he said. "We think that's more appropriate for companies that are either on market or building their capital structure in anticipation of being on the market. We just don't have the near-term cash flow to support convertible debentures at this time."

Emcore upsizes deal

Albuquerque, N.M.-based Emcore Corp. sold an upsized $100 million offering of stock and warrants on Friday, increasing the initial deal of $94 million announced earlier in the day.

The transaction comprises 8 million shares at $12.50 each, an 8.9% discount to Emcore's (Nasdaq: EMKR) closing common stock price of $13.72 on Thursday. Investors will also receive five-year warrants for 1.4 million shares, each warrant exercisable at $15.06. Emcore common stock closed at $12.34 on Friday.

Jefferies & Co. Inc. led the placement efforts, while Canaccord Adams Inc., Lazard Freres & Co. Llc. and Merriman Curhan & Ford Co. were co-placement agents.

The transaction is expected to close on Feb. 20.

Emcore is a provider of compound semiconductor-based components and subsystems for the broadband, fiber optic, satellite and solar power markets.

Sherwood to raise C$7.2 million

Sherwood Copper announced plans to sell up to 1.2 million flow-through shares at C$6 apiece in a non-brokered private placement worth C$7.2 million.

Each share will be sold at C$6 each. Sherwood (TSX: SWC) common stock last traded at C$4.85, down by 2.81% or C$0.14.

Sherwood, a Vancouver, B.C.-based metal mining company, said the proceeds will be used to develop its high-grade Kutcho copper-zinc project in British Columbia and its Minto Mine in the Yukon.

"This financing will provide the necessary funds to begin advancing the Kutcho project towards a production decision," Sherwood president and chief executive Stephen Quin said in a statement.

"In addition to an infill drill program designed to upgrade the current resource, feasibility related work will commence shortly with the objective of defining a robust, low cost mining operation. In parallel, Sherwood will shortly be commencing its 2008 exploration program at the Minto Mine, with the objective of following up on its exploration successes from 2007."

Firstgold could raise $14 million

Firstgold announced plans to sell $5 million to $8 million of secured convertible debentures and $6 million of stock-and-warrant units.

The debentures will be offered in two tranches: $5 million to be sold immediately and $3 million to be sold subject to the delivery of an acceptable engineering report on its Relief Canyon project.

Investors also will receive three series of five-year warrants. If the full $8 million in notes are issued, Firstgold will issue warrants exercisable for $900,000 in common stock at $1 per share, for $2.4 million of stock at $1.25 per share and for $2.4 million of stock at $1.50 per share.

The $6 million of units will be sold at $0.65 each, with each unit comprising one common share and one half-share warrant, with each whole warrant exercisable at $0.80 for 18 months.

Firstgold common stock (OTCBB: FGOC) closed at $0.66 on Friday.

Cameron Park, Calif.-based Firstgold, a metal mining company, said the proceeds of the deal will be used to finance development of its Relief Canyon Mine project in Nevada. The company also said it has received conditional approval to list in Toronto.

"We are pleased to have received conditional approval to list on TSX," Firstgold chief executive Stephen Akerfeldt said in a press release. "We have almost completed construction of our mineral processing facility and this financing will provide sufficient working capital to see us into this next stage of our business development. The addition of a TSX listing will provide the opportunity for enhanced liquidity in and exposure to the Canadian market."

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