TranSwitch
Corporation (NASDAQ: TXCC),
a leading provider of semiconductor solutions in the rapidly growing
consumer electronics and telecommunications markets, today announced
that it has entered into a securities purchase agreement with Ilex
Partners, LLC (“Ilex”), an entity managed by Michael Steinhardt,
pursuant to which the Company has agreed to sell an aggregate of
approximately 9.8 million shares of its common stock for total gross
proceeds of $2.5 million. In connection with the transaction, Ilex
agreed to surrender the warrant to purchase common stock it holds in
exchange for an additional approximately 900,000 shares of the Company’s
common stock. The Company also granted to Ilex the right, for a period
ending on the earlier of 180 days or one business day prior to the
occurrence of a change of control event, to purchase an additional
approximately 9.8 million shares of its common stock for an additional
$2.5 million. In connection with the foregoing, the Company entered into
an amendment to its Rights Agreement with Computershare Trust Company,
N.A., as rights agent, pursuant to which the transactions contemplated
by the securities purchase agreement would not trigger the distribution
of rights thereunder.
The Company has agreed to provide certain registration rights under the
Securities Act of 1933, as amended, to Ilex in connection with the
purchased securities. The Company will be required to file a
registration statement within 20 days of the closing date and will use
its reasonable best efforts to have such registration statement declared
effective as soon as practicable, but in no event later than 60 days of
the closing date (90 days in the event the SEC reviews the registration
statement).
Proceeds from these transactions will be used to fund the Company’s
operations and to meet the Company’s obligations as they may arise.
About TranSwitch Corporation
TranSwitch Corporation (Nasdaq:TXCC) provides innovative
integrated circuit (IC) and intellectual property (IP) solutions that
deliver core functionality for video, voice, and data communications
equipment for the customer premises and network infrastructure markets.
For the customer-premises market, we offer multi-standard, high-speed
interconnect solutions enabling the distribution and presentation of
high-definition (HD) video and data content for consumer electronics
applications. We also provide a family of best-in-class communications
processors. For the network infrastructure market we provide
integrated multi-core network processor System-on-a-Chip (SoC) solutions
for Fixed, 3G and 4G Mobile, VoIP and Multimedia applications. TranSwitch’s
customers are leading consumer electronics and telecom equipment
companies around the globe. For more information, please visit www.transwitch.com.
Forward-looking statements in this release, including statements
regarding management's expectations for future financial results and the
markets for TranSwitch's products, are made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995.
Investors are cautioned that these forward-looking statements regarding
TranSwitch, its operations and its financial results, involve risks and
uncertainties that could cause actual results to differ materially from
those contained in the forward-looking statements, including without
limitation the risks associated with downturns in economic
conditions generally and in the telecommunications and data
communications markets and the semiconductor industry specifically;
risks in product development and market acceptance of and demand for
TranSwitch’s products and products developed by TranSwitch’s customers;
risks associated with foreign sales and high customer concentration;
risks associated with competition and competitive pricing pressures;
risks in technology development and commercialization; risks of
failing to attract and retain key managerial and technical personnel;
risks relating to TranSwitch’s available cash; risks associated with
acquiring new businesses; risks of dependence on third-party VLSI
fabrication facilities; risks related to intellectual property rights
and litigation; and other risks detailed in TranSwitch's filings with
the Securities and Exchange Commission.
TranSwitch expressly disclaims any obligation or undertaking to
release publicly any updates or revisions to any such statements to
reflect any change in expectations or any change in events, conditions
or circumstances on which any such statement is based.
TranSwitch is a registered trademark of TranSwitch Corporation.
![](http://cts.businesswire.com/ct/CT?id=bwnews&sty=20130819005396r1&sid=ntxv4&distro=nx)
Copyright Business Wire 2013