Payzone plans €40 million; QPC raises $1.99 million from convertibles; Orko sells C$10.07 million

By Devika Patel

Knoxville, Tenn., May 20 - Payzone plc announced a €40 million placement to help it recover from recent troubles.

In the United States, QPC Lasers, Inc. took in $1.99 million from the first tranche of a total $3.89 million PIPE designed to help the company expand its facilities and increase marketing efforts, while Orko Silver Corp. plans to use C$10.07 million raised from a shares sale to increase its drilling efforts at a Mexico silver mine.

Payzone to raise €40 million

Payzone plc is planning to sell €40 million of shares and preference shares in a deal aimed to strengthen its business after its recent operational issues arising from the integration of the Cardpoint and alphyra businesses. The two businesses merged last year and the firm has faced multiple headaches since, which has affected its bottom line.

According to an April 14 issue of Forbes, the Dublin, Ireland-based company recently hired a new chief executive officer, after shareholders voted to remove former chief executive officer John Nagle and chief financial officer John Williamson, due to internal squabbling.

On Tuesday, Payzone acknowledged that its "board recognizes that there has been an impact on Payzone resulting from a challenging trading period and the integration of the Cardpoint and alphyra businesses."

In addition to the fund-raising, it announced a revised earnings forecast and said its stock began trading again on Tuesday.

The deal involves 137.3 million ordinary shares, which the company will sell at 20p apiece for £27.46 million, or €34.5 million. It will also sell 5.5 million new euro-denominated convertible preference shares at €1.00 apiece for €5.5 million.

"This fundraising puts Payzone on a firm financial footing from which to take the business forward," said the new chief executive officer, Mike Maloney, in a press release.

"Following a challenging few months operationally for the company, we are now in a position to invest significantly in the business, to implement a three-year growth plan and to capitalize on Payzone's strong market positions throughout Europe. My management team and I look forward to growing this company and seeing that it fulfills its potential."

Payzone allows its United Kingdom clients to pay rent and energy bills electronically in retail stores. Its shares (London: PAYZ) decreased 61.26%, or 29.25p, to close at 18.5p on Tuesday.

QPC Lasers sells convertibles

Laser developer QPC Lasers, Inc., based in Sylmar, Calif., has negotiated a placement of $3.89 million in discounted 10% convertible debentures to help it expand its facilities and increase its marketing efforts.

The company settled an initial $2.2 million tranche on Monday for $1.99 million in proceeds. It is selling the notes at a 10% discount. Its shares remained unchanged Tuesday at $0.60.

The debentures are convertible at $1.05 and mature in April 2010.

Investors also received five-year warrants, exercisable at $1.05. The number of shares each investor will be able to buy will be equal to 200% of the notes' principal divided by $1.05, which works out to warrants for about 4,190,476 shares total.

TR Winston & Co. was the agent.

"As we endeavor to compete in higher volume markets such as consumer electronics, we will require additional manufacturing and clean room space to meet increased production requirements," company co-founder and chief financial officer George Lintz said in a press release.

"Manufacturing capacity is crucial to meeting and growing customer orders and thus is an operational necessity we must proactively address. The ability to deliver in volume and on-time is an important underlying requirement to maintaining and growing long fruitful relationships with new and current customers alike.

"To fund the build out, as well as higher powered additions to our Generation III product line and other corporate marketing and administrative needs, we issued $2.2 million of debentures which may be converted into our common stock at a premium to market."

QPC's stock (OTC Bulletin Board: QPCI) was unchanged in trading Tuesday at $0.60.

Orko Silver arranges C$10.07 million

Orko Silver Corp. announced plans to raise C$10.07 million in order to fund its continued drilling at the La Preciosa Project in Durango, Mexico.

The company has arranged a deal in which it will sell 6.1 million common shares at C$1.65 per share. Settlement is expected June 12.

The company's stock (TSX Venture: OK) decreased by 3.89%, or C$0.07, to close at C$1.73 on Tuesday.

Karim Gangji, Orko's head of investor relations, said of the placement, "The proceeds will be used for drilling La Preciosa project, as we've been having tremendous success there. We've spent well over C$15 million, with four drills every month. Right now, our spending has been bumped up to C$1 million per month."

The reason for all of the spending, Gangji, added, is because "the deposit is really starting to shape up and we plan to keep drilling in order to find out exactly how big it is. We're trying to prove up the size of the mine, to find out how much it will produce.

"We've already extracted 100 million ounces of silver, which was our original target when we first started drilling in 2005, but the mine has far surpassed our expectations."

Gangji said the company bought the mine in 2004 and is very pleased with the results thus far, especially in the project's Martha Vein.

Gary Cope, Orko's president, said of the Martha Vein in an April 28 news release, "The Martha Vein continues to yield excellent grades across exceptionally wide intercepts. The strike length of the Martha structure is growing to the south east and current drilling is focused towards that direction. We are currently drilling holes 236-240 and we now have 85-90 holes drilled that were not in the last resource estimate. This, along with the significant intercepts from yet unnamed veins gives me cause for great optimism about the Company's future."

© 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.