Tvia secures $11.93 million from stock offering; Adam raises $5 million from convertible notes

By Sheri Kasprzak

New York, Aug. 16 - Heading up PIPE action as stocks continued to climb was an $11,925,000 private placement from Tvia, Inc.

In the deal, the company plans to sell 4.77 million shares at $2.50 each to a group of institutional investors. The price per share is an 18% discount to the company's $3.06 closing stock price on Tuesday.

"If you ask me, they sold at that level because they had to," said one market source familiar with the tech sector. "There have been [tech] names out there recently, but let's face it, [there's] nothing worth looking at closely. A lot of small, nothing companies."

The offering, announced Wednesday morning, sent the company's stock up by 0.65%, or 2 cents, to end at $3.08 (Nasdaq: TVIA).

The investors also will receive warrants for 1,669,500 shares, exercisable at $3.50 each for five years, beginning six months after closing.

The deal is scheduled to wrap up on Friday.

Proceeds will be used to fund growth.

According to the company's second-quarter earnings statement released Aug. 11, Tvia incurred a net loss of $1.29 million for the quarter ended June 30, compared with a net loss of $2.04 million for the same quarter of 2005.

Santa Clara, Calif.-based Tvia develops digital display processors for digital high-definition, liquid crystal display, plasma display panel, standard definition and progressive-scan televisions.

Meanwhile, in the broader market, stocks continued to make significant gains for the second-straight session.

The Dow Jones Industrial Average climbed 96.36 to close at 11,327.12; the Nasdaq composite index gained 34.53 to settle at 2,149.54; and the Standard & Poor's 500 composite index edged up 9.85 to end at 1,295.43.

Adam settles $5 million PIPE

In other private placement activity, Adam, Inc. completed a $5 million private placement of convertible notes as part of its acquisition of OnlineBenefits, Inc.

CapitalSource Finance LLC bought a $5 million convertible note. The note due August 2011 bears interest at the greater or Libor plus 250 basis points or Prime rate plus 125 basis points. The note is convertible into a total of 785,279 common shares.

On Wednesday, the company's stock climbed by 1.79%, or 10.6 cents, to settle at $6.036 (Nasdaq: ADAM).

The deal was part of a financing agreement with CapitalSource that also included a $20 million term loan and a $2 million revolver.

The revolver is due August 2011 and bears interest at the greater of Libor plus 400 basis points or Prime rate plus 275 basis points.

The term loan matures June 2011 and bears interest at the greater of Libor plus 400 basis points or Prime rate plus 275 basis points.

Under the terms of the acquisition, Adam bought the outstanding shares of OnlineBenefits for $32.5 million, comprised of $28 million in cash, $1.5 million in debt and 528,681 common shares with a value of $3 million.

Atlanta-based Adam produces software used by the health care sector.

Enbridge stock gains

Moving over to the oil sector, Enbridge Energy Partners, LP watched its stock climb on Wednesday a day after the company settled a $496.8 million placement of trust units.

The stock made gains in spite of continued losses in oil prices. Oil dropped 75 cents to end the session at $72.40 per barrel. Oil fell by 18 cents on Tuesday to settle at $73.35 per barrel.

The stock gained $1.08, or 2.3%, to settle the day at $48.05 (NYSE: EEP). On Tuesday, when the deal was announced, the stock gained 17 cents, or 0.36%, to close at $46.97.

In the placement, the company issued class C units at $46.00 each, a 1.7% discount to the company's $46.80 closing stock price on Monday, to Enbridge Partners and CDP Infrastructures Fund GP.

The units will receive quarterly distributions until Aug. 15, 2009 and will convert into class A common units on a one-for-one basis after Aug. 15, 2009.

Proceeds from the offering will be used for the company's capital expansion program, including East Texas and Southern Access expansion projects.

Houston-based Enbridge is a liquid petroleum pipeline operator and natural gas processing company.

Urbana's C$2 million deal

Looking to Canadian offerings, Urbana Corp. priced a C$2 million private placement of 1 million shares.

Caldwell Securities Ltd. is the placement agent for the deal, which is scheduled to close Aug. 31.

After the offering closes, Urbana will have 10 million outstanding shares.

Proceeds from the deal will be used to purchase at least one seat on the Chicago Board of Options Exchange.

The stock took a hit on Wednesday after the offering was announced in the afternoon, losing 5%, or 10 cents, to close at C$1.90 (TSX Venture: URB).

Located in Toronto, Urbana is an investment company that had previously operated as a mineral exploration company.

General Environmental stock skyrockets

In secondary market activity, General Environmental Management, Inc.'s stock soared by 57.89% after settling a $29.5 million private placement of notes.

The company's stock gained 6 cents to close at $0.15 (OTCBB: GEVM). The stock fell by 26.92%, or 3.5 cents, on Tuesday when the company closed the private placement, to end at $0.095.

In the placement, Laurus Master Fund, Ltd. bought $29.5 million in principal of the notes for proceeds of $25 million.

The three-year notes, which were priced at 84, bear interest at Prime rate plus 200 basis points annually.

In the offering, Laurus received warrants for 13,636,362 shares, exercisable at $0.24 each for seven years.

Proceeds from the deal are being held in escrow until General Environmental completes its acquisition of a private North American waste-management service provider.

When the proceeds are released from escrow, the principal of the note will be replaced by a restated convertible term note of which $12.5 million is convertible at $0.17 each.

Connected to the deal, the company plans to raise at least $16 million in a private placement of common or preferred stock before Sept. 30.

Based in Pomona, Calif., General Environmental provides web-based software focused on the waste-treatment sector.

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