Maxwell Technologies raises $25 million from convertibles; Horizon Offshore wraps stock sale

By Sheri Kasprzak

New York, Dec. 20 - Maxwell Technologies, Inc. headed up PIPE news on Tuesday, wrapping a $25 million convertible debenture deal, while Horizon Offshore Inc. settled a $20 million stock offering.

Maxwell's 5.375% debentures mature in 2009 and are convertible into common stock at $19.00 each. The investors in the deal received warrants for 394,737 shares exercisable at $19.00 each.

As of Oct. 27, the company had 16,540,119 outstanding common shares.

After the closing was announced late Tuesday, Maxwell's stock slipped 2 cents, or 0.13%, to close at $15.16, losing another 5 cents in after-hours trading.

The funds raised from the placement, a statement from Maxwell said, will allow the company to "capitalize on rapidly expanding worldwide demand for ultracapacitors."

"The ultracapacitor market is real and we continue to move aggressively to strengthen the company's capabilities and global reach to serve that market," company chief executive officer Richard Balanson said in a statement. "This means more and broader talent, new and more technologically advanced products, stronger internal and external production and distribution capabilities and a wider network of partnerships and alliances."

In July, Maxwell settled a $5.5 million direct placement of 488,888 shares. And on Nov. 9, 2004, the company raised $11 million in a direct placement of 1.19 million shares.

Looking to its earnings, Maxwell reported a net loss of $1,335,000 for the quarter ended Sept. 30, compared with a net loss of $2,414,000 for the same quarter of 2004.

Maxwell is a San Diego-based power backup and energy supply technology company.

Moving on to the Horizon Offshore offering, the company sold 52.65 million shares at $0.38 each through agent Energy Capital Solutions.

The company reportedly had 212,783,964 outstanding shares as of Nov. 1.

"We are very pleased investors have shown confidence in Horizon, allowing us to strengthen our balance sheet by raising additional equity to provide additional working capital and position ourselves to take advantage of the improved conditions in the marine construction industry," said David Sharp, the company's CEO, in a statement.

The offering was announced Tuesday morning and Horizon's stock gained 4.65%, or 2 cents, to end at $0.45.

Proceeds will be used for working capital and general corporate purposes.

Separately, Horizon said it has exchanged $8 million in principal of its 8% subordinated notes for zero-coupon convertible notes. Those notes are convertible into common shares at $0.38 each through Dec. 31, 2005.

Holders that did not participate in the exchange have also been granted the opportunity to hold $5.2 million in notes to convert their notes into common stock on the same terms as the private placement.

As to the company's earnings, Horizon reported net income of $3.08 million for the quarter ended Sept. 30, compared with a net loss of $23,127,000 for the same quarter of 2004.

Horizon Offshore is a Houston-based provider of marine construction services.

QSGI's $4.3 million deal

Moving to the tech sector, QSGI Inc. wrapped a series A convertible preferred stock offering for $4.3 million.

The company sold 143,333 preferreds at $30.00 each to a group of investors led by Pike Capital Partners, LP and Guerilla Partners LP. The 6% preferreds are convertible into common shares at $2.25 each.

"These are two of our larger investors who have given our QSGI team a tremendous vote of confidence by making this significant investment while agreeing to its long-term common share lock-up provisions," said company CEO Marc Sherman in a statement. "With this financing in place, we have strengthened our balance sheet and now have the financial flexibility to accelerate our ability to realize growth from opportunities which presently exist within the data security and compliance division."

Proceeds will be used for the company's growth strategy within the data security and compliance division.

Based in Hightstown, N.J., QSGI is a data security firm serving corporate and government clients.

Environmental Management leads Canadians

Among Canadian issuers, Environmental Management Solutions Inc. led PIPE news with a C$20 million unit offering.

The company intends to sell units made up of 95% convertible debentures and 5% convertible preferred stock to Oncap II, LP. The units bear interest at 5% paid quarterly in cash. The debentures have an eight-year term and are convertible into common shares at C$0.323 each.

About 10 million preferreds will be issued and carry one vote per share. The preferreds are also convertible into common shares at C$0.323 each.

Proceeds from the deal will be used to repay existing debt, finance growth initiatives and pay for a litigation settlement between the company and its former chief executive officer, Frank D'Addario, and his related parties.

"This C$20 million financing and the related litigation settlement are major steps forward for EMS and its shareholders," said the company's CEO, Tony Busseri, in a statement. "Assuming both initiatives are approved and finalized, EMS will have a solid and sustainable financial base and a highly regarded financial partner, which will enable us to grow and create value for our shareholders.

"We are now also in a much stronger position to arrange the bonding facility that will allow us to seek and win additional business, especially in the key Ontario market. The litigation settlement removes uncertainty that has limited our growth and discouraged potential investors. While there is still work to be done to finalize the financing, we are extremely pleased to be able to look forward to a much brighter future for EMS."

"We believe EMS is poised for significant value creation, through attractive organic and acquisition growth opportunities, and has a strong management team," said Gregory Baylin, a partner at Oncap, in a statement. "With the capital we are providing, EMS can unlock the value in its assets and seize the opportunities in its industry. We look forward to being a significant investor in EMS and working with the company to realize its potential."

Based in Burlington, Ont., Environmental Management provides organic waste and contaminated soil disposal and reuse services.

The company's stock dropped 13.04%, or C$0.06, to end at C$0.40 Tuesday.

Amarin stock gains 12.15%

Amarin Corp. plc's stock jumped a day after announcing the imminent completion of a $26,361,000 private placement.

The company's stock gained 13 cents to close at $1.20 Tuesday.

On Monday, when the offering was announced, the company's stock dropped 8.55%, or 10 cents, to end at $1.07.

The company intends to sell American Depositary Shares to institutional investors at $1.01 each.

London-based Amarin is a biopharmaceutical company focused on developing treatments for central nervous system disorders.

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