UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1995
-------------
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from ------------- to -------------
Commission file number 1-2257
TRANS-LUX CORPORATION
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 13-1394750
------------------------------- -------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
110 Richards Avenue, Norwalk, CT 06856-5090
---------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
(203) 853-4321
----------------------------------------------------
(Registrant's telephone number, including area code)
---------------------------------------------------------------
(Former name, former address and former fiscal year, if changed
since last report.)
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X No
--- ---
Indicate the number of shares outstanding of each of the issuer's
classes of Common Stock, as of the latest practicable date.
Date Class Shares Outstanding
-------- ------------------------------ ------------------
08/10/95 Common Stock - $1.00 Par Value 945,332
08/10/95 Class B Stock - $1.00 Par Value 304,269
(Immediately convertible into a
like number of shares of Common
Stock.)
<PAGE>
TRANS-LUX CORPORATION AND SUBSIDIARIES
INDEX
Page No.
Part I Financial Information
Consolidated Balance Sheets - June 30, 1995
(unaudited) and December 31, 1994 1
Consolidated Statements of Stockholders' Equity -
June 30, 1995 (unaudited) and December 31, 1994 2
Consolidated Statements of Income - Three and Six
Months Ended June 30, 1995 and 1994 (unaudited) 3
Consolidated Statements of Cash Flows - Six Months 4
Ended June 30, 1995 and 1994 (unaudited)
Notes to Consolidated Financial Statements (unaudited) 5
Management's Discussion and Analysis of Financial
Condition and Results of Operations 7
Part II Other Information
Item 4. Submission of Matters to a Vote of Stockholders 9
Item 6. Exhibits and Reports on Form 8-K 10
Signatures 11
<PAGE>
PART I - FINANCIAL INFORMATION
------------------------------
TRANS-LUX CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
June 30 December 31
ASSETS 1995 1994
----------- -----------
(unaudited)
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 598,000 $ 2,335,000
Available-for-sale securities 1,081,000 1,603,000
Receivables 1,528,000 1,403,000
Inventories 1,724,000 517,000
Prepaids and other current assets 340,000 104,000
Current deferred taxes 192,000 192,000
---------- ----------
Total current assets 5,463,000 6,154,000
---------- ----------
Rental equipment 46,364,000 43,807,000
Less accumulated depreciation 16,516,000 14,154,000
---------- ----------
29,848,000 29,653,000
---------- ----------
Property, plant and equipment 22,706,000 18,313,000
Less accumulated depreciation and amortization 7,610,000 5,070,000
---------- ----------
15,096,000 13,243,000
Prepaids, intangibles and other 4,323,000 2,295,000
Maintenance contracts 1,780,000 1,962,000
---------- ----------
$56,510,000 $53,307,000
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------
Current liabilities:
Accounts payable and accruals $ 4,989,000 $ 4,828,000
Income taxes payable 185,000 198,000
Short-term borrowings 500,000 --
Current portion of long-term debt 1,784,000 2,660,000
---------- ----------
Total current liabilities 7,458,000 7,686,000
---------- ----------
Long-term debt:
9% convertible subordinated debentures due 2005 4,874,000 4,874,000
9.5% subordinated debentures due 2012 1,057,000 1,057,000
Notes payable 17,040,000 13,762,000
---------- ----------
22,971,000 19,693,000
Deferred revenue and deposits 1,504,000 2,101,000
Deferred income taxes 3,648,000 3,282,000
Minority interest 13,000 21,000
Stockholders' equity 20,916,000 20,524,000
---------- ----------
$56,510,000 $53,307,000
========== ==========
The accompanying notes are an integral part of these consolidated financial statements.
</TABLE>
1
<PAGE>
TRANS-LUX CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
<TABLE>
<CAPTION>
June 30 December 31
1995 1994
----------- -----------
(unaudited)
<S> <C> <C>
Capital stock:
Preferred - $1.00 par value
Authorized - 500,000 shares
Issued - none
Common - $1.00 par value
Authorized - 4,000,000 shares
Issued - 2,436,136 & 2,435,046 shares $2,436,000 $2,435,000
Class B - $1.00 par value
Authorized - 2,000,000 shares
Issued - 304,269 & 305,359 shares 304,000 305,000
Additional paid-in capital 13,807,000 13,809,000
Retained earnings 16,330,000 15,993,000
Other (64,000) (107,000)
---------- ----------
32,813,000 32,435,000
Less treasury stock - at cost
1,490,781 & 1,492,581 shares in 1995 and 1994
(excludes add'l 304,269 shares held in 1995 &
305,359 in 1994 for conversion of Class B stock) 11,897,000 11,911,000
---------- ----------
Total stockholders' equity $20,916,000 $20,524,000
========== ==========
</TABLE>
THE CHANGES IN CONSOLIDATED STOCKHOLDERS'
EQUITY ARE AS FOLLOWS:
<TABLE>
<CAPTION>
Additional
Common Class Paid-in Retained Treasury
Stock B Stock Capital Earnings Other Stock
------ ------- ---------- -------- ----- --------
<S> <C> <C> <C> <C> <C> <C>
December 31, 1994 $2,435,000 $305,000 $13,809,000 $15,993,000 ($107,000) ($11,911,000)
1/1/95 - 6/30/95: (unaudited)
Net income 423,000
Cash dividends (86,000)
Exercise of stock options (2,000) 14,000
Class B conversion 1,000 (1,000)
Unrealized holding
gain/(loss) 43,000
--------- ------- ---------- ---------- ------ ----------
June 30, 1995 $2,436,000 $304,000 $13,807,000 $16,330,000 ($64,000) ($11,897,000)
========= ======= ========== ========== ====== ==========
The accompanying notes are an integral part of these consolidated financial statements.
</TABLE>
2
<PAGE>
TRANS-LUX CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(unaudited)
<TABLE>
<CAPTION>
FOR THE THREE MONTHS FOR THE SIX MONTHS
ENDED JUNE 30 ENDED JUNE 30
-------------------- ------------------
1995 1994 1995 1994
---- ---- ---- ----
<S> <C> <C> <C> <C>
Gross revenues:
Equipment rentals and maintenance $5,710,000 $5,444,000 $11,192,000 $11,262,000
Equipment sales 3,127,000 1,817,000 6,135,000 3,727,000
Theatre receipts and other 1,024,000 745,000 1,913,000 1,360,000
--------- --------- ---------- ----------
9,861,000 8,006,000 19,240,000 16,349,000
--------- --------- ---------- ----------
Operating expenses:
Cost of equipment rentals and
maintenance 2,907,000 2,835,000 5,846,000 5,872,000
Cost of equipment sales 2,067,000 983,000 3,903,000 2,309,000
Cost of theatre receipts and other 809,000 703,000 1,500,000 1,259,000
--------- --------- ---------- ----------
5,783,000 4,521,000 11,249,000 9,440,000
--------- --------- ---------- ----------
Gross profit from operations 4,078,000 3,485,000 7,991,000 6,909,000
General and administrative expenses 3,175,000 2,727,000 6,314,000 5,405,000
--------- --------- ---------- ----------
903,000 758,000 1,677,000 1,504,000
Interest income 36,000 41,000 93,000 69,000
Interest expense (552,000) (424,000) (1,089,000) (521,000)
Other income 3,000 -- 49,000 --
--------- --------- ---------- ----------
Income before income taxes 390,000 375,000 730,000 1,052,000
Provision for income taxes 164,000 159,000 307,000 282,000
--------- --------- ---------- ----------
Net income $ 226,000 $ 216,000 $ 423,000 $ 770,000
========= ========= ========== ==========
Earnings per share-primary $ 0.18 $ 0.17 $ 0.34 $ 0.61
--------- --------- --------- ---------
Earnings per share-fully diluted $ * $ * $ * $ 0.51
--------- --------- --------- ---------
Average common and common equivalent
shares outstanding-primary 1,258,000 1,268,000 1,260,000 1,268,000
--------- --------- --------- ---------
Average common and common equivalent
shares outstanding-fully diluted * * * 1,978,000
--------- --------- --------- ---------
Cash dividends per share:
Common stock $ 0.035 $ 0.035 $ 0.07 $ 0.07
Class B stock $ 0.0315 $ 0.0315 $ 0.063 $ 0.063
* Fully diluted EPS is not dilutive and therefore not shown.
The accompanying notes are an integral part of these consolidated financial statements.
</TABLE>
3
<PAGE>
TRANS-LUX CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
<TABLE>
<CAPTION>
FOR THE SIX MONTHS ENDED JUNE 30 1995 1994
-----------------------------------------------------------------------------------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income $ 423,000 $ 770,000
Adjustment to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 3,330,000 3,090,000
Deferred income taxes 519,000 (325,000)
Minority interest (8,000) --
Changes in operating assets and liabilities:
Receivables 280,000 113,000
Inventories (185,000) (11,000)
Prepaids and other current assets (183,000) (46,000)
Prepaids, intangibles and other 111,000 81,000
Accounts payable and accruals (939,000) 989,000
Income taxes payable (13,000) (129,000)
Deferred revenue and deposits (597,000) 1,120,000
-----------------------------------------------------------------------------------------
Net cash provided by operating activities 2,738,000 5,652,000
-----------------------------------------------------------------------------------------
CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of rental equipment (2,557,000) (2,389,000)
Purchases of property, plant and equipment (1,120,000) (2,193,000)
Payments for an acquisition (3,178,000) --
Proceeds from acquisition note receivable 658,000 --
Sale of assets 209,000 --
Investment in joint venture (687,000) --
Purchases of securities (494,000) (1,976,000)
Proceeds from sales of securities 1,088,000 1,500,000
-----------------------------------------------------------------------------------------
Net cash (used in) investing activities (6,081,000) (5,058,000)
-----------------------------------------------------------------------------------------
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from long-term debt 4,286,000 844,000
Repayment of long-term debt (3,106,000) (1,058,000)
Proceeds from short-term borrowings 500,000 --
Proceeds from exercise of stock options 12,000 --
Cash dividends (86,000) (86,000)
-----------------------------------------------------------------------------------------
Net cash provided by (used in) financing activities 1,606,000 (300,000)
-----------------------------------------------------------------------------------------
Net increase (decrease) in cash and cash equivalents (1,737,000) 294,000
Cash and cash equivalents at beginning of year 2,335,000 1,128,000
-----------------------------------------------------------------------------------------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 598,000 $ 1,422,000
=========================================================================================
Interest paid $ 900,000 $ 1,263,000
Interest received 113,000 90,000
Income taxes paid 301,000 462,000
-----------------------------------------------------------------------------------------
The accompanying notes are an integral part of these consolidated financial statements.
</TABLE>
4
<PAGE>
TRANS-LUX CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 30, 1995
(unaudited)
Note 1 - Basis of Presentation
Financial information included herein is unaudited, however, such
information reflects all adjustments which are, in the opinion of
management, necessary for the fair presentation of the consolidated
financial statements for the interim periods. The results for the
interim periods are not necessarily indicative of the results to be
expected for the full year. Certain reclassfifications have been
made to prior year's amounts to conform to the current year's
format. It is suggested that the June 30, 1995 consolidated
financial statements be read in conjunction with the consolidated
financial statements and notes included in the Company's Annual
Report and Form 10-K for the year ended December 31, 1994.
Note 2 - Accounting for Income Taxes
The provision for income tax expense for the three months ended
June 30, 1995 was $164,000 of which $158,000 and $6,000 are current
and deferred tax expense, respectively. The provision for income
tax expense for the six months ended June 30, 1995 was $307,000 of
which $288,000 and $19,000 are current and deferred tax expense,
respectively. There was no change in the valuation allowance
during the six months ended June 30, 1995.
Note 3 - Prepaids, Intangibles & Other
Prepaid, intangibles & other consist of the following:
June 30 December 31
1995 1994
--------- -----------
Prepaids and other $1,167,000 $1,145,000
Deferred debenture expense 216,000 168,000
Deferred financing costs 265,000 287,000
Acquisition costs 98,000 100,000
Deposits and advances 71,000 89,000
Long-term note receivable - 218,000
Patents 355,000 -
Goodwill and noncompete agreement 1,174,000 -
Investment in joint ventures 725,000 38,000
Long-term portion of officers'
and employees' loans 252,000 250,000
---------- ----------
$4,323,000 $2,295,000
========== ==========
<PAGE>
Note 4 - Acquisition
On January 17, 1995, the Company, acquired all of the capital stock
of Integrated Systems Engineering, Inc. (ISE), which manufactures
outdoor electronic signs, for a cash purchase price of
approximately $2.7 million plus payment of noncompete and
consulting fees. The payments for the acquisition in the
accompanying Consolidated Statements of Cash Flows is shown net of
$1.9 million of liabilities assumed for the acquisition. The
purchase was financed by working capital and from a new $3.3
million loan and security agreement.
The acquisition was accounted for using the purchase method of
accounting. The purchase price allocation is based on estimated
fair values and is subject to change as additional information
becomes known. Assets include land, building, machinery and
equipment, accounts receivable and inventory. The excess of the
purchase price over the fair value of the net assets acquired has
been recorded as goodwill and is being amortized over 20 years.
Proforma results of operations as if the acquisition had occurred
as of January 1, 1995 are not presented, as the amounts are not
significant to the operation of the Company. The consolidated
financial statements presented herewith reflects the effects of the
transaction.
The Company's proforma financial results are presented to provide
information on the impact of the acquisition of ISE to the results
of operations of the Company for the six months ended June 30,
1994. Proforma financial information reflects the Company's
proforma results of operations as if the acquisition had occurred
as of January 1, 1994.
The following proforma financial information should be read in
conjunction with the Company's consolidated financial statements.
The proforma information does not purport to represent what the
Company's results of operations or financial position would have
been if the acquisition, in fact, had occurred on January 1, 1994,
or to project the Company's results of operations or financial
position for any future period or at any future date.
Six Months Ended
June 30, 1994 (Proforma)
------------------------
(Unaudited)
Gross revenues $18,620,000
===========
Net income $ 833,000
===========
Earnings per share - primary $ 0.66
===========
Earnings per share - fully diluted $ 0.56
===========
<PAGE>
Note 5 - Long-term Debt
The Company has entered into a commitment agreement with First
Fidelity Bank to restructure its current indebtedness to the bank
of approximately $15,500,000 and $4,000,000 line of credit. The
restructuring extends the terms to an average of 11 years and at a
reduced rate of interest. The loans will be collaterized by
certain real estate assets, the assets of Trans-Lux Consulting
Corporation, Trans-Lux Sign Corporation and Integrated Engineering
Systems, Inc. and Trans-Lux Corporation's display lease
receivables. The transaction is expected to be consummated in
August 1995.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
---------------------------------------
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
---------------------------------------------
Results of Operations
---------------------
Gross revenues for the six months ended June 30, 1995 increased
17.7% to $19.2 million versus $16.3 million in the previous year.
Gross revenues for the three months ended June 30, 1995 increased
23.2% to $9.9 million versus $8.0 million in the previous year.
Equipment rentals and maintenance revenue were virtually level at
$11.2 million versus $11.3 million for the six months ended June
30, 1995 as compared to the previous year. Equipment rentals and
maintenance revenues increased 4.9% to $5.7 million compared to
$5.4 million for the three months ended June 30, 1995 and 1994,
respectively. The increase is due to new indoor and outdoor
display rentals offset by the declining revenues from outdoor
display and maintenance contract portfolios previously acquired
with the expectation of being a continually declining installation
base, although the decline is at a slower rate than originally
anticipated.
Equipment sales increased 64.6% or $2.4 million for the six months
ended June 30, 1995 compared to the same period in the previous
year. Equipment sales increased 72.1% or $1.3 million for the
three months ended June 30, 1995 compared to the same period in
1994. The increase is largely attributable to the January 1995
acquisition of Integrated Systems Engineering, Inc. (ISE) and
increased indoor LED display sales.
Theatre receipts and other revenue increased $553,000 or 40.7% for
the six months ended June 30, 1995 compared to the previous year
and increased $279,000 or 37.4% for the three months ended compared
to the same period in the previous year. The increases are
primarily attributable to the opening of the five-plex theatre in
Durango, Colorado in July 1994.
The six month 1995 gross profit margin decreased slightly to 41.5%
as compared to 42.3% for the corresponding period in the previous
year. The three month gross profit margin decreased to 41.4%
compared to 43.5% for the corresponding period in the previous
<PAGE>
year. The decreases are primarily due to the mix of products in
equipment sales and a expected lower profit margin generated by
ISE.
General and administrative expenses for the six months ended June
30, 1995 reflect an increase of $909,000 or 16.8% over the 1994
period and $448,000 or 16.4% increase for the three months ended.
The increases are due primarily to the additional expenses incurred
by ISE.
Interest income for the six months ended June 30, 1995 increased
$24,000 largely due to an increase in interest rates. Interest
expense for the six months ended June 30, 1995 increased $568,000.
The increase in 1995 is due primarily to increased financings
resulting from the acquisition of ISE and higher interest rates on
long-term debt. Interest expense in 1994 included the reduction of
expense due to the settlement of a prior year assessment of a 1986
state income tax audit of approximately $328,000.
The other income for the six months ended June 30, 1995 is
primarily a capital gain on the sale of a drive-in theatre property
in Espanola, New Mexico.
The effective tax rate at June 30, 1995 is 42.0% compared to 26.8%
in the previous year. The provision for income taxes for the six
months ended 1994 reflects a net reduction of approximately $34,000
due to the settlement of a prior year assessment from a 1986 state
income tax audit.
Liquidity and Capital Resources
-------------------------------
The regular quarterly cash dividend for the second quarter of 1995
of $.035 per share on the Company's Common Stock and $.0315 per
share on the Company's Class B Stock was declared by the Board of
Directors on May 18, 1995 payable to stockholders of record as of
June 28, 1995 and was paid July 12, 1995.
At the May 18, 1995 Annual Meeting of Stockholders, the
stockholders approved the creation of 3 million shares of a new
class of capital stock designated Class A Stock, $1.00 par value.
The stock will have no voting rights except as required by law and
will receive 10% higher dividends than the Common Stock. A
certificate of amendment authorizing the Class A Shares and
adjusting authorized shares of Common Stock and Class B Stock will
be filed prior to the first issuance of such Class A Stock. No
specific issuance of Class A Stock is presently contemplated. Also
at the Annual Meeting the stockholders approved the 1995 Stock
Option Plan making available for grant 50,000 shares of Common
Stock and Class A Stock.
The current cash position of the Company continues to remain
satisfactory. The Company feels that its current cash position and
working capital generated by operations will adequately meet its
current operating and financing requirements. This is augmented by
<PAGE>
a $4,000,000 Revolving Credit and Term Loan accessible through
April 1996 of which $3,500,000 is available at June 30, 1995. The
Company entered into an agreement to restructure its $15,500,000
current indebtedness and $4 million line of credit with First
Fidelity Bank which is expected to close in August 1995. The
restructuring will extend the terms and reduce the rate of
interest. Cash and cash equivalents for the six months ended June
30, 1995 decreased by $1,737,000 as compared to an increase of
$294,000 for the corresponding period last year. The decrease is
primarily attributable to cash utilized to acquire ISE, repayment
of long-term debt and investment in a theatrical joint venture.
PART II - OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Stockholders
---------------------------------------------------------
The Annual Meeting of Stockholders of Trans-Lux Corporation was
held on May 18, 1995 for the purpose of electing directors,
approving the appointment of auditors and voting on the proposals
described below.
All of management's nominees for directors as listed in the proxy
statement were elected with the following vote:
Votes For Votes Not For
--------- -----------
Richard Brandt, Class B, Three-Year Term 2,829,570* 3,540*
Jean Firstenberg, Class B, Three-Year Term 2,829,570* 3,540*
Victor Liss, Class B, Three-Year Term 2,829,570* 3,540*
Gene Jankowski, Common, Three-Year Term 706,652 15,634
The following directors are continuing their terms as directors:
Steven Baruch, Common, Two-Year Remaining Term
Matthew Brandt, Class B, One-Year Remaining Term
Thomas Brandt, Class B, Two-Year Remaining Term
Allan Fromme, Class B, Two-Year Remaining Term
Robert Greenes, Common, One-Year Remaining Term
Howard S. Modlin, Class B, One-Year Remaining Term
The recommendation to retain Deloitte & Touche LLP as the
independent auditors for the Corporation was approved:
COMMON STOCK CLASS B STOCK*
------------ --------------
For Against Abstain For Against Abstain
------- ------- ------- --------- ------- -------
710,020 11,279 987 2,833,110 -0- -0-
<PAGE>
The stockholders approved the 1995 Stock Option Plan as follows:
COMMON STOCK CLASS B STOCK*
------------ --------------
For Against Abstain For Against Abstain
------- ------- ------- --------- ------- -------
455,326 34,925 232,035 2,819,900 4,760 8,450
The stockholders also approved amendments to the corporations
Certificate of Incorporation authorizing the creation of 3,000,000
shares of Class A Stock, $1.00 par value and amending the
authorized number of shares of capital stock by the following vote
constituting a majority of each class of stock:
COMMON STOCK CLASS B STOCK*
------------ --------------
For Against Abstain For Against Abstain
------- ------- ------- --------- ------- -------
516,169 175,453 30,644 2,819,900 4,760 8,450
*Based on 10 votes per share
Item 6. Exhibits and Reports on Form 8-K
------------------------------------------
(a) Exhibits
11 Computation of Earnings Per Share
27 Financial Data Schedule, which is
submitted electronically to the
Securities and Exchange Commission for
information only and not filed.
28(a) Amendment No. One to Employment
Agreement with Michael R. Mulcahy.
28(b) Proxy Statement, dated April 12, 1995,
mailed to stockholders which was
previously filed with the Securities
and Exchange Commission and is
incorporated herein by reference.
(b) No reports on Form 8-K were filed during the
quarter covered by this report.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned thereunto duly authorized.
TRANS-LUX CORPORATION
(registrant)
Date: August 11, 1995
/s/ Angela D. Toppi
-------------------------------
by: Angela D. Toppi
Vice President and Chief
Financial Officer
/s/ Catherine E. Nonnenmacher
-------------------------------
by: Catherine E. Nonnenmacher
Chief Accounting Officer
TRANS-LUX CORPORATION & SUBSIDIARIES EXHIBIT 11
COMPUTATION OF EARNINGS PER SHARE
<TABLE>
<CAPTION>
FOR THE THREE MONTHS FOR THE SIX MONTHS
ENDED JUNE 30, 1994 ENDED JUNE 30, 1994
------------------- -------------------
Primary:
-------
<S> <C> <C>
Net income $216,000 $770,000
========= =========
Average common shares outstanding 1,247,532 1,247,540
Assumes exercise of options reduced by
the number of shares which could have
been purchased with the proceeds from
exercise of such options 20,676 20,676
--------- ---------
Average common and common equivalent
shares outstanding 1,268,208 1,268,216
========= =========
Primary earnings per share $0.17 $0.61
========= =========
Fully diluted:
--------------
Net income $216,000 $770,000
Add after tax interest expense applicable
to 9% convertible subordinated debentures 115,000 230,000
--------- ---------
Adjusted net income $331,000 $1,000,000
========= =========
Average common shares outstanding 1,247,532 1,247,540
Assumes exercise of options reduced by
the number of shares which could have
been purchased with the proceeds from
exercise of such options 20,676 20,676
Assumes conversion of 9% convertible
subordinated debentures 709,921 709,921
--------- ---------
Average common and common equivalent
shares outstanding 1,978,129 1,978,137
========= =========
Fully diluted earnings per share $0.17 $0.51
========= =========
Fully diluted earnings per share are not presented for the three and six
months ended June 30, 1995 as the effect is not dilutive.
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM THE CONSOLIDATED BALANCE SHEET AND THE CONSOLIDATED
STATEMENT OF INCOME FILED AS PART OF THE QUARTERLY REPORT ON FORM
10-Q AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS ON FORM 10-Q.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1994
<PERIOD-END> JUN-30-1995
<CASH> 598
<SECURITIES> 1,081
<RECEIVABLES> 1,528
<ALLOWANCES> 0
<INVENTORY> 1,724
<CURRENT-ASSETS> 5,463
<PP&E> 69,070
<DEPRECIATION> 24,126
<TOTAL-ASSETS> 56,510
<CURRENT-LIABILITIES> 7,458
<BONDS> 5,931
<COMMON> 2,740
0
0
<OTHER-SE> 18,176
<TOTAL-LIABILITY-AND-EQUITY> 56,510
<SALES> 6,135
<TOTAL-REVENUES> 19,240
<CGS> 3,903
<TOTAL-COSTS> 11,249
<OTHER-EXPENSES> 6,314
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,089
<INCOME-PRETAX> 730
<INCOME-TAX> 307
<INCOME-CONTINUING> 423
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 423
<EPS-PRIMARY> .34
<EPS-DILUTED> .34
</TABLE>
Exhibit 28(a)
AMENDMENT NO. ONE TO EMPLOYMENT AGREEMENT
-----------------------------------------
AGREEMENT ("Amendment Agreement") made as of the lst day of
June, 1995 to agreement made as of June 1, 1994, (the
"Agreement") by and between TRANS-LUX CORPORATION, a Delaware
corporation having an office at 110 Richards Avenue, Norwalk,
Connecticut 06856-5090 (hereinafter called "Employer"), and MICHAEL
R. MULCAHY, residing at 73 Rees Drive, Oxford, Connecticut 06483
(hereinafter called, "Employee").
W I T N E S S E T H:
- - - - - - - - - -
l. Paragraph 2(a) of the Agreement is amended to read in
its entirety as follows:
"(a) The term ("Term) of the Agreement shall be the
period commencing on the date hereof and terminating
May 3l, l998."
2. The second and third sentences of paragraph 3 is
amended to read in its entirety as follows:
"Employer shall use its best efforts to cause Employee to
be elected and continue to be elected an Executive Vice President
of Employer during the term of this Agreement. The precise
services of Employee may be designated or assigned from time to
time at the direction of the Board of Directors, the Chairman of
the Board, the Vice Chairman of the Board or the President, and all
of the services to be rendered hereunder by Employee shall at all
times be subject to the control, direction and supervision of the
Board of Directors of Employer, to which Employee does hereby agree
to be bound."
3. Paragraph 4(a) of the Agreement is amended in its
entirety to read as follows:
"(a) For all services rendered by Employee during the
remaining Term of this Agreement after the date hereof, Employer
shall pay Employee a salary at the rate of ONE HUNDRED THIRTY-FIVE
THOUSAND DOLLARS ($135,000) per annum during the period June l,
1995 to May 31, 1996; at the rate of ONE HUNDRED FORTY FIVE
THOUSAND DOLLARS ($145,000) per annum during the period June 1,
1996 to May 31, 1997; and at the rate of ONE HUNDRED FIFTY FIVE
THOUSAND DOLLARS ($155,000) per annum during the period June 1,
1997 to May 31, 1998. Such salary shall be payable weekly, or
monthly, or in accordance with the payroll practices of Employer
for its executives. The Employee shall also be entitled to all
rights and benefits for which he shall be eligible under any stock
option plan, bonus, participation or extra compensation plans, pensions,
group insurance or other benefits which Employer presently provides,
or may provide for him and for its employees generally. Such rights and
benefits include the sales override commission plan (as currently in place
and compensated monthly) based on all sales and rentals of Employer's
world-wide sales staff, excluding for 1995 only outdoor displays.
The sales override commission shall not exceed (x) $50,000 for
January l-December 3l, 1995, $55,000 for January l - December 3l,
1996, $60,000 for January l - December 3l, 1997 or $25,000 for the
period January l-May 3l, l998 plus (y) for any such period in which
the bonus sales goal is exceeded, an additional bonus of 110% times
the override factor times the excess. For example, if the sales
override amount for a given period (year) is $36,000 and if the
mutually agreed upon goal for that period is $11,376,000, the
factor is .0031645 (override amount divided by goal) and sales
reached is $12,376,000, then there is an additional override
commission of $3,480.95 ($l,000,000 x .0031645 x 110%).
Notwithstanding the foregoing, in no event shall an additional
override be paid for any amount which exceeds twice the mutually
agreed goal (e.g. up to $22,752,000 if the goal is $11,376,000).
This Agreement shall not be deemed abrogated or
terminated if Employer, in its discretion, shall determine to
increase the compensation of Employee for any period of time,or if
the Employee shall accept such increase. In addition to the group
insurance set forth herein, Employer also agrees to provide
Employee with life insurance in the amount of $75,000 at the
non-smoking rate during the term of this Agreement, provided
Employee is insurable at standard rates, with Employee paying any
excess premium over the non-smoking rate. All payments under this
Agreement are in United States dollars unless otherwise specified.
In the event Employee is non-insurable, then Employer shall pay to
Employee from such determination during the remainder of the term
annually the amount the premium would have been at the standard
rates."
4. Paragraph 4(c) of the Agreement is amended in its
entirety to read as follows:
"(c) If, during the Term of this Agreement and if the
Employee is still in the employ of Employer, Employee shall be
prevented from performing or be unable to perform, or fail to
perform, his duties by reason of illness or any other incapacity
for (4) consecutive months (excluding normal vacation time) during
the Term hereof, Employer agrees to pay Employee thereafter during
the Term for the duration of such incapacity, or eighteen (18)
months, whichever is greater, 35% of the base salary which Employee
would otherwise have been entitled to receive if not for the
illness or other incapacity."
5. Paragraph 4(d) of the Agreement is amended in its
entirety to read as follows:
"(d) The Board upon the recommendation of the
Compensation Committee of the Board shall consider no later than
May 31, 1996, 1997, l998 and 1999 respectively (provided there is
no delay in obtaining the financial statements as provided below,
but in no event later than 45 days following receipt thereof) the
grant of a bonus ("Bonus") to Employee based on Employer's
performance for the immediately preceding fiscal year.
Notwithstanding the foregoing, Employer shall pay Employee the
highest Bonus applicable for any of the fiscal years ending
December 31, 1995, 1996, 1997 and l998 only, (provided however that
the Bonuses, if any, for 1998 shall be 41.67% of the amount set
forth below for such year), in the respective amounts hereinafter
set forth in the event Employer's pre-tax consolidated earnings for
such year determined in accordance with Section 4(d) meet or exceed
the respective amounts hereinafter set forth, not to exceed $30,000
for any year ($12,500 for l998).
If Pre-Tax Annual
Consolidated Non-Cumulative
Earnings Exceed Level of bonus Payable
--------------- -----------------------
1995 1996 and 1997 1998 (41.67%)
---- ------------- ----
$ 250,000 $ 2682 $ 2813 $ 1172
375,000 4023 4219 1758
500,000 5364 5625 2344
625,000 6705 7031 2930
750,000 8047 8438 3516
875,000 9388 9844 4102
1,000,000 10729 11250 4688
1,125,000 12070 12656 5274
1,250,000 13411 14063 5860
1,375,000 14752 15468 6446
1,500,000 16093 16875 7032
1,625,000 17434 18281 7618
1,750,000 18775 19688 8204
1,875,000 20116 21094 8790
2,000,000 21458 22500 9376
2,125,000 22798 23906 9962
2,250,000 24140 25313 10548
2,375,000 25481 26719 11134
2,500,000 26822 28125 11720
2,625,000 28163 29531 12306
2,750,000 29504 30000 Maximum 12500 Maximum
2,875,000 30000 Maximum 30000 Maximum 12500 Maximum
3,000,000 30000 Maximum 30000 Maximum 12500 Maximum
There shall be excluded from the calculation of pre-tax
consolidated earnings during the Term of this Agreement the amount
by which (x) any item or items of unusual or extraordinary gain in
the aggregate exceeds 20% of the Employer's net book value as at
the end of the immediate preceding fiscal year or (y) any item of
unusual or extraordinary loss in the aggregate exceeds 20% of the
Employer's net book value as at the end of the immediate preceding
fiscal year, in each case in (x) and (y) above as determined in
accordance with generally accepted accounting principles and items
of gain and loss shall not be netted against each other for purpose
of the above 20% calculation.
Provided Employee is not in default of the Agreement, the
Board may, in any event, even if any of the aforesaid pre-tax
consolidated earnings levels are not exceeded, grant the Employee
the aforesaid Bonus or any portion thereof for such year based on
his performance.
Notwithstanding anything to the contrary contained
herein, if Employee is not in the employ of Employer at the end of
any aforesaid 1995, 1996 or 1997 fiscal year, or on May 31, 1998 no
Bonus shall be paid for such fiscal year or part thereof as to
1998. In the event of Employee's death on or after January 1 of
1995, 1996, 1997 or 1998, or June l, 1998 as to 1998, any Bonus to
which he is otherwise entitled for the prior fiscal year or 1998,
as the case may be, shall be paid to his widow if she shall survive
him or if she shall predecease him to his surviving issue per
stirpes and not per capita.
Such pre-tax consolidated earnings shall be fixed and
determined by the independent certified public accountants
regularly employed by Employer. Such independent certified public
accountants, in ascertaining such pre-tax consolidated earnings,
shall apply all accounting practices and procedures heretofore
applied by Employer's independent certified public accountants in
arriving at such annual pre-tax consolidated earnings as disclosed
in Employer's annual statement for that year of profit and loss
released to its stockholders. The determination by such
independent certified public accountants shall be final, absolute
and controlling upon the parties. Payment of such amount, if any
is due, shall be made for each year by Employer to Employee within
sixty (60) days after which such accountant shall have furnished
such statement to Employer disclosing Employer's pre-tax
consolidated earnings for each of the years 1995, 1996, 1997 and
1998. Employer undertakes to use reasonable efforts to cause said
accountants to prepare and furnish such statements within one
hundred thirty (130) days from the close of each such fiscal year
and to cause said independent certified public accountants,
concomitantly with delivery of such
statement by accountants to it, to deliver a copy of such
statement to Employee. The Employer shall not have any liability
to Employee arising out of any delays with respect to the
foregoing."
6. Paragraph 4(c) of the Agreement is amended in its
entirety to read as follows:
"(e) In the event Employee dies during the Term of this
Agreement while the Employee is still in the Employ of Employer,
Employer shall pay to Employee's widow or his surviving issue, as
the case may be, for eighteen (18) months, annual death benefits
payable weekly or in accordance with Employer's payroll practices
in an amount equal to 40% of Employee's then annual base salary
rate."
7. Paragraph 4(g) of the Agreement is amended in its
entirety to read as follows:
"(g) In the event Employee leaves the employ of Employer
at the end of the Term or any renewal Term and provided that
Employee has not been discharged for cause, then Employer shall pay
to Employee weekly or bi-weekly in accordance with Employer's
payroll practices as severance pay an amount equal to fifty percent
(50%) of Employee's base salary under Section 4(a) in effect at
time of termination for eighteen (18) months (e.g. at rate of
$77,500 if termination is June l, 1998); provided further that if
Employee violates the confidentiality clause in Section 3 or any of
the clauses in Section 7, Employer may, in addition to all other
remedies to which it is entitled, cease the payments under this
Section 4(g). The severance pay hereunder is not payable in the
event Employee dies during the Term or any renewal Term."
8. All other terms of the Agreement remain in full force
and effect.
9. This Amendment Agreement shall be construed in
accordance with the laws of the State of New York.
TRANS-LUX CORPORATION
By: /s/ Victor Liss
-----------------------------
President
/s/ Michael R. Mulcahy
_____________________________
Michael R. Mulcahy
