LECG to issue preferreds; Toro Energy gets equity line; Northern Tiger wraps unit, stock sale

By Stephanie N. Rotondo

Portland, Ore., Aug. 18 - There was a moderate amount of activity in the private placement market Tuesday, with deals ranging from the low single-digits to larger double-digit financings.

LECG Corp. was among the companies that brought larger deals to market. The company said it was looking to raise $25 million through a preferred share sale. The financing is in connection with a planned merger.

Meanwhile, Toro Energy Ltd. also announced a double-digit transaction. The company said it secured a A$20 million five-year equity line of credit to fund it current drill program.

Among closed deals, Northern Tiger Resources Inc. settled its C$1.1 million sale of stock and units. With the completion of the financing, the company said it was increasing its drill program at Sonora Gulch.

CanAlaska Uranium Ltd. also wrapped a deal, or at least part of it. The uranium exploration company took in C$750,000 in the first tranche of a C$1.02 million placement.

Luiri Gold Ltd. closed on its C$2.63 million private placement of stock. The shares were sold to Lachlan Star.

LECG to issue preferreds

LECG will privately place $25 million of its 7½% series A convertible redeemable preferred stock with Great Hill Partners.

The company will issue 6.3 million of the preferreds at $3.96 each. The shares are initially convertible at $3.96.

The financing is in conjunction with LECG's merger with Smart Business Advisory & Consulting LLC. That transaction is expected to close in 2010.

Great Hill is Smart's majority shareholder.

"The board believes this merger is advantageous to all stakeholders, dramatically improving the competitive position of the company," said Garrett Bouton, chairman of LECG, in a press release. "Great Hill Partners' $25 million investment in the combined company will represent the first major capital investment in this sector in more than a year and we are confident that their interests will be aligned with those of our existing shareholders.

"We look forward to having representatives from such a successful investment firm on our board and believe that our strengthened balance sheet and enhanced operating platform will provide a further competitive advantage as the markets recover."

LECG's equity (Nasdaq: XPRT) gained 17 cents, or 4.82%, to $3.70. Market capitalization is $94.8 million.

LECG is an Emeryville, Calif.-based provider of independent expert testimony and original authoritative studies in both adversarial and non-adversarial environments.

Toro Energy secures equity line

Toro Energy, a Norwood, Australia-based uranium exploration company, inked a A$20 million equity line of credit with YA Global Master SPV Ltd., according to a press release.

The credit line can be drawn down in tranches of up to A$500,000 in any 10-day period over the course of five years. The price per share will equal the lowest daily volume weighted average price during the 10 trading days following notice of a draw.

"While Toro has sufficient funds in the near term to advance its projects, this $20 [million] 'at call' facility will enable increased flexibility in terms of quantum and timing of financing our activities going forward," said Greg Hall, managing director, in the release. "Importantly, it enables Toro to continue the fast tracked development of the advanced Wiluna Uranium Project in Western Australia, toward first production in 2012."

Proceeds will be used for "ongoing uranium exploration at the company's projects, including additional drilling at the Fond Du Lac project," the press release read.

Toro's shares (Australia: TOE) ended at A$0.175.

Northern Tiger wraps unit, stock sale

Northern Tiger Resources completed a C$1.1 million private placement of units and stock, the company announced.

The company issued approximately 1.83 million flow-through class A common shares at C$0.20 per share. Approximately 3.65 million units containing one class A common share and one warrant were also sold, at C$0.20 each.

Each warrant is exercisable at C$0.30 for two years.

With the completion of the financing, the company chose to expand a previously announced exploration program at Sonora Gulch. Northern Tiger had previously said it would spend C$1 million on the project to drill seven holes. The company now intends to spend C$1.75 million for 12 holes.

"When we initially planned the million-dollar project, we were in the middle of the financial downturn," said Greg Hayes, president and chief executive, in an interview with Prospect News. At the time, he said, it was felt that would be sufficient to cover the costs of the project.

But as the economy has improved some, and investors reacted strongly to Northern Tiger's financing news, it was deemed appropriate to increase the project, Hayes explained.

"It makes sense to have a bigger project and get a bigger bang for your buck," Hayes said.

Hayes also said that the private placement route was easier, given the size of the financing.

"For this size of financing, it was pretty cost effective," he said, noting that the company paid only about C$4,000 in expenses related to the deal.

"It went really well," he added. "Now funds are available for the right project, so we didn't have a lot of trouble.

"You had to knock on a lot of doors to get this kind of financing earlier in the year," he remarked. "And even then you might not have gotten it."

Northern Tiger's equity (TSX Venture: NTR) improved by C$0.025, or 13.89%, to C$0.205. Market capitalization is C$6.34 million.

Northern Tiger Resources is a Calgary, Alta.-based resource exploration company.

CanAlaska settles first tranche

CanAlaska Uranium took in C$750,000 in the first tranche of its previously announced non-brokered private placement of units, the company announced.

The deal originally priced on July 23.

The Vancouver, B.C.-based company sold 4.41 million units at C$0.17 per unit. Each unit contains one flow-through share and one half-share warrant. Each whole warrant is exercisable at C$0.24 for two years.

Of the units sold, Mineral Fields Group purchased about 2.94 million units, making the company the lead investor, according to Emil Fung, director and vice president of corporate development.

"We have a very loyal investor base," he said, noting that many investors "believe we will be successful in finding the uranium we are looking for."

"The key is you got to be funded and you got to keep going," Fung said. "We're well on our way."

Fung also said that he believed CanAlaska's deal was "one of the larger placements in the uranium space."

"The whole mineral exploration area has shrunk because of liquidity problems," he said.

But CanAlaska will continue to search for the uranium in its properties, he said, with the help of the current financing. However, he noted that the company "is not relying solely on" the funds raised in the transaction.

Fung pointed to the company's strategic partners, many of which are located in the Asian sphere.

"All of these countries want to find uranium and they all want to come to Canada because we have the best uranium in the world," Fung said.

Looking forward, Fung could not say when future tranches might close, given the "current market conditions."

"Nothing is guaranteed," he said.

CanAlaska's stock (TSX Venture: CVV) increased by a penny, or 6.67%, to C$0.16. Market capitalization is C$21.4 million.

Luiri completes equity deal

Luiri Gold also closed on a private placement financing Tuesday, taking in C$2.63 million.

The company said it received C$1.14 million in the second tranche of the deal. The first tranche of C$1.49 million closed July 8.

The deal originally priced June 8.

Under the terms of the transaction, Luiri sold 21.89 million shares at C$0.12 to Lachlan Star. As a result of the financing Lachlan now holds a 31% equity interest in the company.

"The completion of this transaction is a very positive development for Luiri," said Mike Sperinck, president and CEO, in a news release. "It now allows us to focus over the next six to 12 months on the two major initiatives in the company which are to expand the overall resource at the Luiri Hill project, and to complete prefeasibility studies on the current resource base.

"We are confident that, by following up on the positive results from the most recent drilling at the five other targets which are all in close proximity to the resources already defined at Matala and Dunrobin deposits respectively, we will be able to increase the resource base," Sperinck added. "This will enable Luiri to expand the scope of the prefeasibility study to design a mining operation significantly larger than that envisaged on the current resource."

Luiri's shares (TSX Venture: LGL) closed unchanged at C$0.17. Market capitalization is C$8.44 million.

Luiri Gold is a Toronto-based gold exploration company.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.