Private placement volume remains weak; BPI Industries finishes $13 million offering

By Sheri Kasprzak

Atlanta, Jan. 14 - Private placement volume stagnated Friday, despite a better stock market and higher oil prices.

Some sell-siders said mergers and acquisitions may push the market in the near future.

"It's Friday, for one thing," said one sell-sider. "Things are typically a bit slower at the end of the week, but things have really been slow all week. The stock market was off earlier in the week, but I don't see anything in particular that would pull down volume today."

"I think I have mentioned before many of the companies that do PIPEs are smaller and do so using flow-through shares," said one Canadian sell-sider. "Lots of deals got done at the end of the year. Given that it is early in the year, the appetite for tax deals is not as great [and] companies will hold off until later in the year."

The Canadian source also said higher oil prices should drive up the stocks of energy companies.

"Until the companies have a use of proceeds, they will not finance," the source said. "Expect things to pick up as [merger and acquisition] activity starts again."

To round out the week, the Dow Jones Industrial Average gained 52.17 to end at 10,588, the Nasdaq composite closed up 17.35 at 2,087.91 and the S&P 500 ended the day 7.07 higher at 1,184.52.

Oil prices gained $0.34 to end the day at $48.38 per barrel.

In the United States, BPI Industries Inc. led news by closing a $13 million private placement.

The company sold 5.2 million units at $2.50 each, the units being comprised of two shares and a warrant.

Each warrant allow for an additional share at $1.50 each for two years.

Sanders Morris Harris Inc. was the placement agent in the deal.

"The successful completion of this financing marks the beginning of BPI's transformation into a fully fledged exploration and production company," said the company's chief executive officer and president James Azlein, in a statement.

"We are pleased with the receptivity of investors to our development strategy for BPI's Illinois CBM assets. The capital raised will allow us to aggressively pursue the drilling opportunities on our current projects which have the potential to build meaningful values for our shareholders."

Based in Vancouver, B.C., BPI is an oil and gas exploration company. It plans to use the proceeds from the offering to continue its drilling projects.

BPI's stock closed down $0.05 at $1.485 on Friday.

COMC raises $5.5 million

COMC Inc. completed a $5.5 million financing comprised of a $2.5 million secured convertible revolving note, a $2 million secured convertible term note and a $1 million convertible minimum-borrowing note.

The notes were purchased by Laurus Master Fund Ltd.

The company's management did not comment directly on the notes Friday and instead referred to a pending form 8-K from the Securities and Exchange Commission.

Burnham Securities Inc. was the financial advisor in the offering.

In other news at COMC, the company said Friday that it has acquired Southwest Century Communications Inc., a Houston-based telephony and data technologies provider.

"As a result of the combination of the strategic initiatives - acquisition and financing - COMC has the scale to reach operating profitability in 2005, the geographical footprint and technological expertise to drive organic growth, and a balance sheet and capital structure to support additional consolidation in this fragmented industry," said COMC's chief executive officer Janice Fuellhart, in a statement.

COMC, based in Concord, Calif., designs, implements, supports and manages computer network systems, voice communication network systems and premise wiring for data and voice.

The company's stock closed unchanged at $0.20 on Friday.

Trinity wraps offering

Trinity Learning Corp. has closed a private placement of $1,552,500 in convertible notes.

The notes bear interest at 9% annually and mature in one year.

The notes are convertible into common shares at any time at $0.73 per share.

Warrants were also issued in the offering for 2,126,712 shares exercisable at $1.50 each for three years.

Based in Berkeley, Calif., Trinity Learning provides technology-based workplace learning, certification and training.

Trinity's stock closed unchanged at $0.80 Friday.

HIMC closes $1.35 million deal

HIMC Corp. closed a placement for $1,447,726 after selling 2,954,544 shares at $0.49 each.

"That's a discount of about 70%," said one market source familiar with the deal. "But this company has been through a lot of restructuring. Even though HIMC seems to be improving financially, it is a long process."

"We are very pleased to close this financing, which allows HIMC to move forward with its plans," said HIMC's president Virgil Llapitan, in a statement.

"A portion of this funding will go towards redesigning our sales program. Previously, we utilized outside sales agents. Now we can build an internal sales department, which we believe will increase sales substantially. We are also in the midst of launching a major marketing campaign, which includes re-branding the company. This financing not only provides the funds which HIMC needs to implement our growth initiatives, but also demonstrates shareholders' faith in the company's future."

Based in Tacoma, Wash., HIMC is a technology company that offers payment, verification and authentication systems to internet service providers. The proceeds from the offering will be used to develop the company's sales and marketing department, expand its management team, and facilitate the execution of existing and new contracts.

On Friday, HIMC's stock closed up $0.02 at $1.67.

Multiband's $1.4 million offering

Multiband Corp. will head to the private placement market to raise $1.4 million, the company said.

The company will sell 1 million units at $1.40 each. The units are comprised of one share and one warrant.

The warrants allow for an additional share at $2 each.

Based in Minneapolis, Multiband is a voice, data and video systems provider to apartment buildings and time-share resorts.

Multiband's stock closed up $0.029 at $1.459 Friday.

Strathmore plans C$10 million offering

Heading up private placement action north of the border, Strathmore Minerals Corp. said it plans to raise up to C$10 million in a non-brokered deal.

The company plans to sell up to 6,666,667 units and a minimum of 3,333,333 units at C$1.50 each.

The units are comprised of one share and one half-share warrant. The whole warrants allow for an additional share at C$1.75 each for the first year and C$2 each for the second.

Based in Vancouver, B.C., Strathmore acquires mineral properties.

On Friday, Strathmore's stock closed up C$0.21 at C$1.97.

Lemontonic's upsized deal

Lemontonic Inc. closed an upsized private placement Friday for C$5,175,000.

The company issued 34.5 million class A shares at C$0.15.

An over-allotment option for 1.2 million shares was exercised by placement agent Canaccord Capital Corp.

Lemontonic is a Toronto-based networking software company. The company plans to use the proceeds from its private placement for marketing, product research and development, payment of outstanding accounts and general working capital.

The company's stock closed up C$0.045 at C$0.27 Friday.

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