nCoat to complete $11.85 million PIPE; TheGlobe may pay legal costs with PIPE

By Sheri Kasprzak

New York, June 1 - nCoat, Inc. ended the week in PIPEs with word that it plans to close an $11.85 million offering of convertible notes.

Meanwhile, TheGlobe.com, Inc., a company in hot water with MySpace, Inc., may be paying its legal bills with a $3 million private placement, the company said Friday.

In the broader market, the Dow Jones Industrial Average reached another all-time high, but the news may not impact PIPE volume that much.

"We're seeing things here and there," said one market source. "More stuff from tech seems to be getting into the market now; so, you may be seeing more in that sector in the next week or so."

The Dow gained 40.47 to end at 13,668.11, and the Nasdaq composite index ended the week up 9.40 at 2,613.92. The Standard & Poor's 500 composite index climbed 5.72 to close at 1,536.34.

In the nCoat, Inc. offering, the company is preparing to sell $8.85 million in series A convertible notes and $3 million in series B convertible notes.

The 6% notes are convertible into common shares at $0.40 each, almost a 50% discount to the company's $0.785 closing stock price on Thursday.

The stock remained unmoved Friday at $0.785 (OTCBB: NCOA).

The investors also will receive series A warrants for 22.125 million shares and series B warrants for 7.5 million shares.

Under the note terms, the company may sell another $17.75 million in notes, with no more than $9 million being from series A notes, by June 18.

Proceeds will be used for acquisitions, debt repayment, working capital and general corporate purposes.

Connected to this offering, holders of $2 million in convertible debentures issued between Oct. 1, 2006 and March 1, 2007 requested the conversion of their securities. The debentures are convertible at $0.50 each, and conversion is expected to occur within the next week.

"This capital raise and conversion of debt to equity significantly strengthens our financial structure and better positions nCoat management to execute our strategic plans, including acquisition of additional companies, integral organic growth and expansion of existing facilities and markets," said chief executive officer Paul Clayson in a statement released Friday.

"The investors in this transaction also expand our institutional shareholder base."

Located in Whitsett, N.C., nCoat develops nano-formulated and traditional coatings applied to metals, ceramics, fabrics and other materials.

TheGlobe's $3 million deal

In the tech sector Friday, TheGlobe.com announced that it penned a private placement agreement with Dancing Bear Investments Inc. for up to $3 million in convertible notes. So far, the company has received $250,000 from the deal.

TheGlobe found itself in hot water earlier this year after allegedly sending out unsolicited e-mails on MySpace.com.

The company has been ordered by a district court judge to pay $2.55 million in damages to MySpace, Inc., and this offering may be part of TheGlobe's efforts to pay the settlement.

In March, TheGlobe announced plans to conduct a PIPE to pay the settlement.

Even though the settlement would put a serious dent in the company's resources, paying back the recent notes may not be much easier.

The company said in an 8-K filed Friday with the Securities and Exchange Commission that it does not have the resources to pay the notes if a demand is made. The company also does not have the resources to repay $3.4 million in convertible demand notes issued in 2005. If a demand for payment is made, the holders of the 2005 notes could seize and sell all of TheGlobe's assets.

Dancing Bear may buy more

Under the terms of the placement, Dancing Bear may buy up to another $2.75 million in notes before Nov. 25, 2007.

Dancing Bear is an affiliate of TheGlobe CEO Michael Egan.

The 10% notes are due five days after a demand from the investor and are convertible into common stock at a penny each.

On Friday, TheGlobe's stock jumped 40%, or 1.4 cents, to end at $0.049 (OTCBB: TGLO).

"The agreement with Dancing Bear Investments demonstrates Mr. Egan's continuing commitment to TheGlobe.com, which now consists mainly of our Tralliance operations," said TheGlobe president Ed Cespedes in a statement. "We continue to believe in Tralliance and the .travel top level domain."

Based in Fort Lauderdale, Fla., TheGlobe.com develops voice-over-internet protocol technologies.

Noveko raises C$23 million

Moving to Canadian offerings, Noveko International Inc. sealed a C$23 million private placement.

The company sold 9.2 million units of one share and one half-share warrant at C$2.50 each.

The whole warrants are exercisable at C$3.35 each for two years. The expiry of the warrants may be accelerated to 30 days if the weighted average trading price of the company's stock exceeds C$4.00 for more than 20 consecutive trading days.

Desjardins Securities Inc. was the lead agent for the deal.

"We are pleased to announce the closing of this financing, which will contribute to a major new growth phase for Noveko International and its subsidiaries," said CEO Andre Leroux, in a news release.

"Among our priorities, we will complete new milestones in marketing the derivative products from our patented antimicrobial filtration technology, specifically face masks and air filters, which offer considerable growth potential. We are currently looking at several opportunities in North America."

Montreal's Noveko markets real-time ultrasound scanners used in human and veterinary medicine.

DXP stock climbs after hours

A day after announcing plans to raise $47 million in a registered direct offering, DXP Enterprises, Inc.'s stock remained unchanged during the trading session, but edged up after hours.

The stock closed at $47.45 on Friday but gained 18 cents after the market closed (Nasdaq: DXPE).

On Thursday, when the offering priced, the stock fell 4.89%, or $2.44, to close at $47.45.

In the placement, DXP plans to sell shares at $47.00 each, a 9.7% discount to the company's $52.09 closing stock price on Tuesday.

The shares will be sold under the company's shelf registration through placement agent Stephens Inc.

Houston-based DXP distributes maintenance, repair and operating products to industrial customers.

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