Phoenix Technologies raises funds for 'exotic' purposes; China Holdings plans $10 million sale

By Stephanie N. Rotondo

Portland, Ore., June 29 - Energy and mining companies dominated the private placement market Monday, though other sectors were also represented.

In particular, Phoenix Technologies Ltd. announced a $13.05 million registered direct offering of stock. The company's chief financial officer told Prospect News that the funds would serve to further the company's "technically exotic" initiatives.

Back in the energy and mining arena, China Holdings Inc. said that it would raise $10 million, along with a subsidiary, in two deals. Proceeds will be used for development.

Uranium Energy Corp. said it completed a $22.31 million stock and unit sale. The deal includes two series of warrants.

Also, Lapp Plats plc arranged a £4.2 million equity placement. The company plans to use proceeds to acquire undervalued oil and gas assets.

Away from that, NovaDel Pharma Inc. announced it had reached an equity financing agreement with an investor for up to 13 million shares. Funds will be used to advance the company's drug pipelines.

Phoenix raises $13.05 million

Phoenix Technologies said it would take in $13.05 million via a registered direct offering of equity.

The Milpitas, Calif.-based company will issue 5.8 million common shares at $2.25 per share.

Richard Arnold, the company's chief operating and chief financial officer, told Prospect News that the deal would serve to "increase the strength of the balance sheet."

As of March, the company had $22 million in cash on hand and no debt, Arnold noted.

"But we have been burning through cash," he said, adding that it is expected that the burn will continue through September. At that time, Arnold estimated that the company would have about $15 million in cash.

"We don't feel that's an appropriate size cushion," he said.

Arnold said the recent cash burn is related to two of the company's initiatives: Hyperspace, an "instant-on always connected Linux system," that works along with Windows operating system or as a standalone system; and Failsafe, a theft prevention function that allows users to tighten security.

"For example, if you left your laptop in a taxi, you could send the system an SMS message to literally turn it into a brick," Arnold explained.

"So it's cool stuff and technically very exotic," he said. "It's needed because we have become mobile and our computing devices have not become what we need them to be."

Phoenix' equity (Nasdaq: PTEC) fell 39 cents, or 12.23%, to $2.80. Market capitalization is $81.5 million.

China Holdings sells stock

China Holdings, along with its China Power subsidiary, announced two private placements for total proceeds of $10 million.

For its part, China Holdings will issue 50 million common shares at $0.10 per share. Investors will also receive two series of warrants equal to 50 million additional shares at a strike price of $0.20 for the first year and at $1.00 for the next two years.

China Power will meanwhile sell 10 million shares at $0.50 per share. Like the China Holdings deal, investors in the China Power transaction will receive two series of warrants good for 10 million additional shares, exercisable at $1.00 for one year and at $2.00 for two years.

Both the parent and subsidiary plan to use proceeds for development purposes.

Also, China Holdings said in a regulatory filing that it was becoming a non-reporting issuer "for the legal protection to the company and public shareholders' interest."

E-mails made to the company's chief executive officer seeking comment went unreturned Monday.

China Holdings' equity (Pink Sheets: CHHL) gained $0.004, or 50%, to $0.012.

China Holdings is a Las Vegas-based development-stage diversified global assets holding company. China Power is based in Beijing.

Uranium Energy wraps deal

Austin, Texas-based Uranium Energy settled a non-brokered private placement of units and equity, bringing in $22.31 million.

The company sold approximately 9.09 million units and 200,000 common shares at $2.40 each. Each unit holds one common share and one half-share two-year warrant, which is exercisable at $3.10.

Proceeds will be used, in part, for the completion of the company's Goliad ISR Uranium Project, a uranium mine located in Goliad County, Texas.

Uranium's stock (Amex: UEC) slipped 18 cents, or 5.34%, to $3.19. Market capitalization is $145 million.

Lapp Plats to take in £4.2 million

Lapp Plats - soon to be renamed Cove Energy plc - has negotiated a £4.2 million private placement of stock, according to a press release.

The London-based company plans to sell 25 million ordinary shares at 12p per share.

Proceeds will be used to further the company's corporate strategy of acquiring undervalued oil and gas assets. Also to that end, the company has signed a joint venture deal with Quantic Group.

"We are very pleased to announce this successful fundraising, which means, alongside our existing cash resources, we are well capitalized to actively progress our new strategy, to identify and acquire undervalued oil and gas exploration and production assets in Africa and Eastern Mediterranean," said John Craven, chief executive officer, in the release. "The signing of the MOU with Quantic Group is also a significant move for the business, which gives us potential exposure to the highly prospective Lebanese and Cypriot license areas with the financial backing and stability of Gazprombank Invest as well as their influence in North African oil and gas activities. The fact that PGS has also participated in the placing gives us great confidence for any involvement we might have in exploration in North Africa, the Lebanon or Cyprus, as they hold a large amount of the technical seismic and geological data on the area.

"Following the placing we are now well financed to start implementing our strategy, with a senior, experienced board and access to further capital," Craven continued. "This gives us a sound platform from which we can start to deliver on our strategic plan. We look forward to updating the market as to our progress as soon as is practicable."

Lapp's stock (London: LPP) closed at 25p. Market capitalization is £7.24 million.

Lapp Plats is a London-based holding company for Lapp Plats AB, a natural resource exploration company.

NovaDel secures equity financing

NovaDel Pharma inked an equity financing deal with Seaside 88 LP for up to 13 million shares.

Under the terms of the deal, Seaside is required to buy stock from NovaDel in two-week intervals for a total of 26 tranches. Each tranche will consist of 500,000 shares.

Upon each closing, the total proceeds will be calculated by applying a 13% discount to the volume weighted average price of NovaDel's stock for the 10 days prior to the closing. Should the average price fall below $0.25, a closing will not occur.

NovaDel also has the option of terminating the deal between the sixth and seventh closings.

"This infusion of capital will allow NovaDel to continue the commercialization of Zolpimist and Nitromist as well as initiate the development of our promising pipeline utilizing our Novamist technology," said Steven B. Ratoff, chairman and interim CEO, in a statement. "This financing addresses NovaDel's cash operating requirements through the investment period and enables the company to price future closings with Seaside as we achieve our business objectives."

NovaDel's shares (Amex: NVD) move dup 3 cents, or 9.26%, to $0.34. Market capitalization is $20.7 million.

NovaDel Pharma is a Flemington, N.J.-based developer of drug delivery systems for prescription and over-the-counter drugs.

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