Company may force conversion of preferreds after three years
By Susanna Moon
Chicago, Sept. 15 – Trans-Lux Corp. announced the terms of the rights offering for up to $10.2 million of its 6% series B convertible preferred stock. The company had registered up to $10.4 million of 5% series B convertible preferreds on June 26.
The initial conversion price will be $10.00 per share, representing a conversion ratio of 20 shares of common stock for each preferred share, according to a company press release.
The company may force conversion of the preferreds after three years or as early as one year if the closing sale price of the common stock is at or above $15.00 for 30 consecutive trading days.
The rights offering will begin on Oct. 1, when Trans-Lux plans to distribute one non-transferable subscription right to purchase shares of a new class of series B convertible preferred for each share of Trans-Lux’s common stock owned at 5 p.m. ET on Sept. 28, the record date for the rights offering.
For every 33 subscription rights, holders have the right to purchase one series B convertible preferred at a subscription price of $200.00 per share, with the subscription period expiring at 5 p.m. ET on Oct. 21.
The rights offering also will include an over-subscription right, which entitles each rights holder to purchase additional convertible preferreds that remain unsubscribed at the expiration of the rights offering, the release noted.
Proceeds will be used to repay debt and to pay required contributions under the company’s defined benefit pension plan, with the remainder slated for general corporate purposes.
Trans-Lux, based in Norwalk, Conn., designs, manufactures and installs large-scale indoor and outdoor LED electronic display systems.
| Issuer: | Trans-Lux Corp.
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| Issue: | Series B convertible preferred stock
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| Amount: | Up to $10.2 million
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| Price: | $200.00
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| Dividend: | 6%
|
| Conversion price: | $10.00
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| Conversion ratio: | 20 common shares per preferred share
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| Mandatory conversion: | Company may force conversion after three years or as early as one year if closing stock price is at or above $15.00 for 30 consecutive trading days
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| Warrants: | No
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| Pricing date: | Sept. 15
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| Rights offering period: | Oct. 1 through 5 p.m. ET on Oct. 21
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| Stock symbol: | OTC: TNLX
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| Stock price: | $2.85 at close Sept. 11
|
| Market capitalization: | $4.8 million
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