Trans-Lux Successful in Comprehensive Restructuring Plan

Nov 15, 2011 Trans-Lux Corporation, a supplier of LED technology for high resolution video displays and lighting applications, has announced the successful completion of an extensive financial restructuring and re-capitalization of the Company.

According to press release, as part of the Company's restructuring plan, the Company raised $8.3 million of equity capital (the "Offering") consisting of (i) 416,500 shares of the Company's Series A Convertible Preferred Stock, par value $1.00 per share (the "Preferred Stock") having a stated value of $20.00 per share and convertible into fifty (50) shares of the Company's Common Stock, par value $1.00 per share (or up to 20,825,000 shares of Common Stock), and (ii) 4,165,000 one-year warrants (the "A Warrants"). The Preferred Stock will automatically convert into Common Stock once the shareholders approve an increase to the number of shares of authorized Common Stock at the Company's next annual meeting and the Company files an amendment to its certificate of incorporation so that there is an adequate amount of shares available for issuance. These securities were issued at a purchase price of $20,000 per unit (the "Unit"). Each Unit shall consist of 1,000 shares of Preferred Stock (convertible into 50,000 shares of Common Stock) and 10,000 A Warrants. Each A Warrant shall entitle the holder to purchase (a) one share of the Company's Common Stock and (b) a three-year warrant (the "B Warrants"), at an exercise price of $1.00 per share (subject to adjustment to $0.20 per share). Each B Warrant shall entitle the holder to purchase one share of the Company's Common Stock at an exercise price of $1.00 per share (subject to adjustment to $0.50 per share). The restructuring plan included offers to the holders of the 8 1/4% Limited convertible senior subordinated notes due 2012 (the "Notes") to receive $225 plus 250 shares of the Company's Common Stock for each $1,000 Note tendered and to the holders of the 9 1/2% Subordinated debentures due 2012 (the "Debentures") to receive $100 for each $1,000 Debenture tendered. $8,976,000 principal amount of the Notes and $718,000 principal amount of the Debentures were tendered. The Preferred Stock, as well as the Common Stock offered in exchange for the Notes, will not and have not been registered under the Securities Exchange Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements. The Debentures are subordinate to the claims of the holders of the Notes and the Company's senior lender under the Credit Agreement, among other senior claims. Both offers expired on October 31, 2011.

The net proceeds of the Offering were used to fund the restructuring of the Company's outstanding debt, which includes: (1) a cash settlement to holders of the Notes; (2) a cash settlement to holders of the Debentures; (3) payment of the Company's outstanding term loan with the senior lender and (4) payment of $1.0 million on the Company's outstanding revolving loan with the senior lender. Any net proceeds of the Offering remaining after payment to holders of the Notes, the Debentures and the senior lender will be used for working capital and other general corporate purposes. The Placement Agent will receive a 4.8% commission and warrants to purchase the Company's Common Stock.

"The success of the restructuring plan will now allow us to focus on growing the digital signage and LED lighting businesses, Trans-Lux's portfolio of end-to-end solutions unlocks a whole new realm of new business development opportunities," continued Mr. Allain.


Author:  Alice Jones

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