Westwood announces $100 million sale of stock, preferreds; Verenium prices $54 million convertibles

By Laura Lutz

Des Moines, Feb. 25 - Westwood One, Inc. led Monday's PIPE news with a planned private placement for up to $100 million.

In the tech industries, Verenium Corp. arranged a $54 million private placement of senior convertible notes, and Hoku Scientific, Inc. sold a $25 million private placement of stock.

Also on Monday, Titan Energy Worldwide, Inc. announced the closing of a $6.5 million private placement of convertible preferreds.

Westwood to sell stock, preferreds

The Westwood One placement will consist of common stock and 7.5% series A convertible preferred stock.

Gores Group, LLC is the investor.

Initially, Gores will buy $12.5 million of Westwood One's common shares at $1.75 apiece.

At Westwood One's option, Gores will buy up to $12.5 million more of common stock and $50 to $75 million of preferred stock.

The additional common shares will also be priced at $1.75.

The preferreds will be convertible into common shares with an initial conversion price of $3.00 per share.

The preferred stock will be redeemable at Westwood One's option after 57 months. In addition, Westwood One may force conversion if the closing price of its common stock is at least $4.00 for 60 of any 90 consecutive trading days.

Conversion may also be forced if the company sells $50 million or more of its common stock to a third party at a price per share of at least $4.00.

Gores will also receive warrants for 10 million common shares in three tranches. They will have strike prices of $5.00, $6.00 and $7.00.

Settlement of the complete placement also depends on closing of pending agreements between Westwood One and CBS Radio Inc.

"This investment is a key element of our strategic process to enhance shareholder value and an important component in satisfying the conditions to closing our proposed agreements with CBS Radio," Thomas Beusse, president and chief executive officer of Westwood One, said in a news release.

Norman J. Pattiz, chairman of the board of Westwood One, added in the release, "This investment brings with it Alec Gores' and his team's considerable operational resources and provides the company with significant resources to once again focus on the production of quality original programming for our current and emerging media platforms," Norman J. Pattiz, chairman of the board of Westwood One, was quoted saying.

New York-based Westwood One supplies radio and television stations with information services and programming.

"We are excited about the prospect of partnering with Norm, Tom and the rest of the board to strengthen one of the great brands in media," Alec Gores, founder and chief executive officer of Gores Group, was quoted saying.

"This investment represents a natural extension of our experience in assisting companies that are in the midst of operational transition and our history of partnering with existing shareholders to create value. Westwood One is a franchise asset but one that requires the type of intense operational focus with which we and the board are in agreement to effect," Scott Honour, senior managing director of Gores, said in the release.

Westwood's shares closed down 14 cents, or 7.78%, at $1.94 on Monday before gaining another 6 cents in after-hours trading (NYSE: WON).

Verenium prices convertibles

Verenium said it plans to sell about $54 million of 8% convertibles due April 1, 2012.

The notes will convertible into common stock at an initial conversion price of $4.09 per share.

Verenium may force conversion in some circumstances if its stock trades above $8.18 per share - 200% of the initial conversion price.

Investors will also receive warrants for 8 million shares, exercisable at $4.44 per share.

Lazard Freres & Co. LLC is the agent.

Settlement is expected Feb. 27.

Verenium is a San Diego-based developer of specialty enzymes used in alternative fuel, industrial, health and nutrition processes.

The company said it will use the proceeds of the placement for general corporate purposes and working capital.

Its shares dropped 44 cents, or 12.5%, to $3.08 on Monday before gaining back $0.1238 in after-hours trading (Nasdaq: VRNM).

Hoku to raise $25 million

Hoku's private placement will consist of 2,893,520 common shares at $8.64 apiece, according to an 8-K filing with the Securities and Exchange Commission.

Settlement is expected Feb. 29.

Kapolei, Hawaii-based Hoku is a materials science company focused on clean energy technologies.

It said it will use some of the proceeds to construct a polysilicon production plan in Pocatello, Idaho. The rest will be used for working capital and general corporate purposes.

The company's stock raised $1.04, or 11.23%, to close Monday at $10.30 before losing 3 cents if after-hours trading (Nasdaq: HOKU).

Titan pockets $6.5 million

Titan Energy sold 650 preferred series D shares for $10,000 apiece. Each preferred share is convertible into 10,000 shares of common stock.

Investors also received one type A warrant and one type B warrant for each $10,000 invested, each of which is exercisable for 3,333 common shares at $1.20 and $1.40, respectively.

Titan is a Cardiff, Calif.-based producer of generators, emergency power equipment and specialized mobile utility systems.

"With this financing Titan now has the capital and resources to aggressively move forward with its growth initiatives. Specifically, we plan to continue building our core businesses, close strategic acquisitions and expand our growth into key alternative energy markets," John Tastad, chief executive officer of Titan, said in a news release.

"Despite uncertainties in the stock market and the economy, we succeeded in raising equity with investors placing their confidence in Titan's long-term strategy, business plan and potential for increased value. We are excited about fulfilling our vision to become 'Your Next Generation Power Company,'" Tastad said.

Titan's stock gained 2 cents, or 2.5%, to close at $0.82 on Monday (OTCBB: TEWI).

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