-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, KK+5EGo+vnsgukGk5e6IC7tBf7sskGKyCef9YL1x8o++EY6n2GtriZzbNk4rxdR5 0mf3trcLsitEgGXcosxXfg== 0000099106-09-000001.txt : 20090106 0000099106-09-000001.hdr.sgml : 20090106 20090106172750 ACCESSION NUMBER: 0000099106-09-000001 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 5 CONFORMED PERIOD OF REPORT: 20081231 ITEM INFORMATION: Entry into a Material Definitive Agreement ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20090106 DATE AS OF CHANGE: 20090106 FILER: COMPANY DATA: COMPANY CONFORMED NAME: TRANS LUX CORP CENTRAL INDEX KEY: 0000099106 STANDARD INDUSTRIAL CLASSIFICATION: MISCELLANEOUS MANUFACTURING INDUSTRIES [3990] IRS NUMBER: 131394750 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-02257 FILM NUMBER: 09511025 BUSINESS ADDRESS: STREET 1: 110 RICHARDS AVE CITY: NORWALK STATE: CT ZIP: 06856-5090 BUSINESS PHONE: 2038534321 MAIL ADDRESS: STREET 1: 110 RICHARDS AVENUE CITY: NORWALK STATE: CT ZIP: 06856-5090 8-K 1 tx8k123108.txt CONTRACT CHANGES UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT _________________ Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): December 31, 2008 TRANS-LUX CORPORATION --------------------- (Exact name of registrant as specified in its charter) Delaware 1-2257 13-1394750 - -------------------------------------------------------------------------------- (State or other jurisdiction (Commission (I.R.S. Employer of incorporation) File Number) Identification No.) 26 Pearl Street, Norwalk, CT 06850 ---------------------------------------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (203) 853-4321 - -------------------------------------------------------------------------------- (Former name or former address, if changed since last report.) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) Item 1.01 Entry into a Material Definitive Agreement The following agreements have been amended in order to comply with the provisions of Section 409A of the Internal Revenue Code regulations and guidance issued thereunder, including IRS Notice 2007-34 (the 409A Requirements) requiring deferred compensation arrangements as defined therein to be in compliance by December 31, 2008. There has not been any increase in benefits in these agreements. Item 9.01 Financial Statements and Exhibits (d) Exhibits. 10.1 Supplemental Executive Retirement Plan dated January 1, 2009, filed herewith. 10.2 Amended and Restated Employment Agreement with Michael R. Mulcahy dated January 1, 2009, filed herewith. 10.3 Amended and Restated Employment Agreement with Al Miller dated January 1, 2009, filed herewith. 10.4 Amendment to Consulting Agreement with Moving Images, LLC dated December 31, 2008. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized: TRANS-LUX CORPORATION by: /s/ Angela D. Toppi -------------------------- Angela D. Toppi Executive Vice President and Chief Financial Officer Dated: January 6, 2009 EX-10.1 2 serp.txt SUPPLEMENTAL RETIREMENT PLAN Trans-Lux Corporation Supplemental Executive Retirement Plan ------------------------------------------------------------ Effective January 1, 2009 TABLE OF CONTENTS ----------------- Page ---- ARTICLE I GENERAL PROVISIONS .............................................1 1.01 Synopsis .......................................................1 ARTICLE II DEFINITIONS ...................................................2 ARTICLE III ELIGIBILITY ..................................................4 3.01 Eligibility and Participation ..................................4 ARTICLE IV BENEFITS ......................................................5 4.01 Benefits .......................................................5 4.02 Form of Benefits ...............................................5 4.03 Death Benefits .................................................5 ARTICLE V ADMINISTRATION .................................................7 5.01 Source of Benefits .............................................7 5.02 Alienation of Benefits .........................................7 5.03 Withholding ....................................................7 5.04 Payments to Legal Incompetents .................................7 5.05 Correction of Mistakes .........................................7 5.06 Claims and Review ..............................................7 5.07 Company Actions ................................................8 5.08 Administrator ..................................................8 ARTICLE VI MISCELLANEOUS .................................................9 6.01 Intent .........................................................9 6.02 Governing Law ..................................................9 6.03 Amendment or Termination .......................................9 6.04 No Contract of Employment ......................................9 6.05 Payment of Plan Expenses .......................................9 6.06 Communications with Participants About the Plan ................9 6.07 Severability ..................................................10 6.08 Execution of the Plan Document ................................10 ARTICLE I GENERAL PROVISIONS ------------------ 1.01 Synopsis. This Agreement sets forth the Supplemental Executive -------- Retirement Plan (the "SERP") established and maintained by Trans-Lux Corporation (the "Company") generally to provide benefits for participants in the Retirement Pension Plan for Employees of Trans-Lux Corporation and Certain of its Subsidiaries and/or Affiliates (the "Plan") equal to the benefit that cannot be paid under the Retirement Plan because of the limits in Sections 401(a)(17) and 415 of the Code and other restrictions. The Plan is unfunded and benefits shall be paid from the general funds of the Company. The Plan is primarily for the purpose of providing deferred compensation for a select group of management or highly compensated employees. Benefits are not intended to be taxable to a Participant until the benefits are actually received. The Plan is intended to comply with Code Section 409A and implementing regulations. The Administrator shall interpret and implement this Plan in a manner consistent with its purpose and intent. To the extent a Participant has an employment agreement with the Company providing for ASRB payments, this Agreement does not increase the amount of any such payments, provided, however, the form of payment permitted by Section 4.02 may be greater than that permitted under the Retirement Plan because of financial restrictions then applicable to the Retirement Plan. In the event of any other conflict between this Agreement and such employment agreement, this Agreement shall govern. 1 ARTICLE II DEFINITIONS ----------- Terms not defined herein shall have the meaning set forth in the Retirement Plan. 2.01 Administrator - means Trans-Lux Corporation. 2.02 ASRB - means the Additional Supplemental Retirement Benefits provided by this SERP, as further described in Section 4.01. 2.03 Beneficiary - means any person (including a Contingent Annuitant), designated by the Participant to receive any death benefits which may be payable under the SERP in the event of the Participant's death. Such Beneficiary designation is subject to spousal consent requirements of Section 5.1 of the Plan. 2.04 Change of Control - an event defined as a Change in Control in the Trans-Lux Corporation Definitive Proxy Statement pursuant to Section 14(a) of the Securities Exchange Act of 1934. 2.05 Code - refers to the Internal Revenue Service Code. 2.06 Company - refers to Trans-Lux Corporation, a Delaware corporation. 2.07 Corporate Group - means the Company and any entity aggregated with and treated as a single employer with the Company pursuant to Code Sections 414(b) or (c), substituting "at least 50 percent" for "at least 80 percent" in Code Section 1563(a)(1), (2) and (3) and in applying Treas. Reg. Section 1.414(c)-2. 2.08 Disability - a medically determinable physical or mental impairment which constitutes disability under the Company's separate long term disability plan. 2.09 Disability Retirement - a Termination of Employment as a result of Disability having attained age 45 and completed at least 15 years of Vesting Service Participant. 2.10 Effective Date - January 1, 2009. 2.11 ERISA - refers to the Executive Retirement Income Security Act of 1974. 2.12 Participant - refers to an employee of the Company or other member of the Corporate Group who satisfies the eligibility criteria set forth in Section 3.01. 2.13 Plan or Retirement Plan - refers to Retirement Pension Plan for Employees of Trans-Lux Corporation and Certain of its Subsidiaries and/or Affiliates, as amended and restated effective December 31, 2002, and any subsequent restatements thereof; provided that any 2 references herein to particular sections of the Plan shall be deemed to refer to the successors of such sections contained in the restated Plan. 2.14 Termination of Employment - a complete severance of the Participant's employment relationship with the Company and all members of the Corporate Group for any reason other than his death. A transfer from employment with the Company to employment with a subsidiary or affiliate of the Company shall not constitute a Termination of Employment. 3 ARTICLE III ELIGIBILITY ----------- 3.01 Eligibility and Participation. Eligibility in the Plan is limited to ----------------------------- participants in the Retirement Plan whose benefit under the Retirement Plan is limited by Code Sections 401(a)(17) or 415 or other limitations, and who is appointed or designated by the Board of Directors of the Company as a Participant; specifically, as of the Effective Date, Michael R. Mulcahy. 4 ARTICLE IV BENEFITS -------- 4.01 Benefits. The Company will pay to the Participant on the first day of -------- the seventh month following the earlier of the Participant's Normal Retirement Date, Earlier Retirement Date, Disability Retirement or Deferred Retirement Date, an amount (the "Excess Benefit") equal to an annuity for the life of the Participant of (a) minus (b) below: a. The Accrued Benefit determined under Plan Section 4.1 (for payments commencing on or after the Participant's Normal Retirement Date or Deferred Retirement Date), Plan Section 4.2 (for payments commencing at the Participant's Earlier Retirement Date) or Plan Section 10.2 (for payment on account of the Participant's Disability Retirement) but without regard to (i) the limitations on the maximum annual benefits imposed by Code Section 415, (ii) the limitations on the amount of annual compensation which may be taken into account under Code Section 401(a)(17), (iii) any further limitations in benefits under the Plan resulting from statutory changes or from modifications in the Plan required by statutory changes after December 31, 2001, or (iv) the discontinuation of the Plan or the accrual of benefits thereunder following a Change of Control. b. The Accrued Benefit payable under the Retirement Plan. 4.02 Form of Benefits. The Excess Benefit shall be paid in the form of a ---------------- lump sum payment that is actuarially equivalent to the Excess Benefit (expressed as a single life annuity), as conclusively determined by the Company in accordance with interest, mortality and other assumptions being used at that time in connection with the Plan. Notwithstanding the foregoing, the Participant may elect any alternate form of payment available under the Retirement Plan, provided that the election is made at least one year prior to the date benefits would otherwise commence under the terms of this Agreement and, provided further that the first payment under the alternate form of payment is not less than five years from the date the lump sum payment would have been paid. 4.03 Death Benefits. If a Participant dies before the Excess Benefit -------------- commences hereunder, and is survived by a Spouse, then the Company shall pay to the surviving Spouse an annuity equal to 50% of the Excess Benefit that would have been payable to the Participant had the Participant terminated from employment on the day before his death, survived to his earliest retirement age, elected Earlier Retirement and a 50% Joint and Survivor benefit (as defined by the Retirement Plan), and then died. Notwithstanding the foregoing, if the Participant had attained Earliest Retirement Date on the date of death, the survivor benefit described in the foregoing sentence shall be determined as is the Participant had retired on the date of death and Section 4.2 of the Plan applied. Such annuity shall be payable for the life of the Participant's surviving spouse, with monthly payments commencing on the first day of the month coincident with or next following the later of (i) the date of the Participant's death, or (ii) the date the Participant would have attained age 55 if the Participant had completed 10 Years of Credited Service as of the date of death. 5 The provisions of Plan Section 7.1 (relating to the reduction in benefits for young Spouses and the single sum payment of small benefits) shall apply to the death benefit under the SERP in the same manner as applies under the Plan. 6 ARTICLE V ADMINISTRATION -------------- 5.01 Source of Benefits. Benefits shall be paid from the general assets of ------------------ the Company and shall not be funded, by trust or otherwise, except that in the discretion of the Company a so-called "rabbi trust" may be used to facilitate payment of Plan benefits and to serve as a repository for earmarked funds. No Participant or surviving Spouse shall have a right to payment of plan benefits greater than that of a general creditor of the Company. Nothing herein shall be deemed to create a trust of any kind or to create any fiduciary relationship with respect to any assets whatsoever. 5.02 Alienation of Benefits. Benefits are not subject to alienation, ---------------------- anticipation or assignment by a Participant or surviving Spouse and to the maximum extent permitted by law, are not subject to being attached or reached and applied by any creditor. In the event a Participant's benefits under the Plan are garnished or attached by an order of any court, the Administrator may bring an action for a declaratory judgment in a court of competent jurisdiction to have the order declared unenforceable against the Plan because of the general prohibition of the assignment or alienation of Plan Benefits contained in this Section 4.02. During the pendency of the action, any benefits that become payable may be paid to the court for distribution by the court to the recipient that the court determines to be proper. 5.03 Withholding. Payments under the Plan shall be adjusted to ----------- appropriately reflect any applicable income tax withholding requirements, payroll taxes, or other deductions authorized by the Company in accordance with its policies. Any additional taxes payable by the Participant on any ASRB payment as a result of the inability to pay the ASRB benefit under the Plan shall be paid by the Company to the Participant and grossed up in such manner to offset the effect of the Participant's state and federal income taxes on such payment. 5.04 Payments to Legal Incompetents. Upon proof satisfactory to the ------------------------------ Administrator that any person entitled to receive a payment under the plan is legally incompetent to receive the payment, the Administrator may direct the payment to be made to the guardian or conservator or other personal representative of the estate of the person. 5.05 Correction of Mistakes. Any mistake in the amount of a Participant's ---------------------- benefits under the plan may be corrected by the Administrator when the mistake is discovered. The mistake may be corrected in any reasonable manner authorized by the Administrator (e.g., where a mistake is not timely discovered), or the Administrator may waive the making of any correction. A Participant or Beneficiary receiving an overpayment by mistake shall repay the overpayment if requested to do so by the Administrator. 5.06 Claims and Review. ----------------- a. Written Claim is Not Required. Ordinarily, ASRB benefits will be paid ----------------------------- to Participants or their surviving Spouses without their having to file a claim or take any other action. If a Participant or surviving Spouse does not receive payment of benefits which the Participant or 7 Spouse believes are due under the SERP, the Participant or Spouse may file a written claim for benefits with the Administrator. The written claim shall be in a form satisfactory to and with such supporting documents and information as may be required by the Administrator. b. Notice of a Claim Denial. If a claim for benefits under the SERP is ------------------------ denied in whole or in part by the Administrator, the claimant shall be notified in writing within a reasonable period of time following the denial. The notice shall set forth: i. the reasons for the denial of the claim; ii. a reference to the provisions of the SERP on which the denial is based; iii. any additional material or information necessary to perfect the claim and an explanation why they are necessary; and iv. a reference to the procedures for review of the denial of the claim set forth in Section 5.06(c). c. Right to Review of the Denial. Every person whose claim for benefits ----------------------------- under the SERP is denied in whole or in part by the Administrator shall have the right to request a review of the denial. A claim which has not been approved or denied by the Administrator within 90 days of the date it was filed shall be deemed to be denied and the claimant shall have the right to request a review of the denial. Review shall be granted if it is requested in writing by the claimant no later than 60 days after the claimant receives written notice of the denial. The review shall be conducted by the Administrator. d. Decision on Review. With respect to any requested claim review, the ------------------ claimant shall have an opportunity to submit and review pertinent documents and may submit a written statement. The Administrator shall render its decision as soon as practicable. Ordinarily decisions shall be rendered within 60 days following receipt of the request for review. If special circumstances require additional processing time, the decision shall be rendered as soon as possible but not later than 120 days following receipt of the request for review. The Administrator's decision shall be in writing, shall set forth the reasons for the decision and the provisions of the Plan on which it is based and shall be communicated to the claimant. The Administrator's decision shall be final and binding on the claimant, and the claimant's heirs, assigns, administrator, executor and any other person claiming through the claimant. 5.07 Company Actions. Whenever the Board of Directors is required or --------------- permitted to take any action under the terms of the Plan, it may be taken by resolution voted by the Board of Directors. Such action may also be taken by any officer, employee, or agent of the Company duly authorized to take such action by the Company's Board of Directors. 5.08 Administrator. The Administrator shall operate, interpret, and ------------- implement the plan. The Administrator's decisions and determinations (including determinations of the meaning and reference of terms used in this Plan) that are not arbitrary and capricious shall be conclusive upon all persons. The Administrator shall be the Named Fiduciary for purposes of the Employee Retirement Income Security Act of 1974, as amended ("ERISA"). 8 ARTICLE VI MISCELLANEOUS ------------- 6.01 Intent. This Plan is intended to be unfunded and maintained by the ------ Company primarily for the purpose of providing deferred compensation for a select group of management or highly compensated employees within the meaning of Section 201(2) of ERISA. Benefits are intended not to be taxable to Participants under the Code until paid. This Plan shall be construed and interpreted in a manner consistent with the foregoing intentions. 6.02 Governing Law. This Plan shall be governed by the law of the State of ------------- New York to the extent that it is not preempted by federal law. 6.03 Amendment or Termination. The SERP may not be amended, modified or ------------------------ terminated except by written agreement of the Participant and the Company. The Board of Directors of Trans-Lux Corporation shall have the exclusive authority, which authority may not be delegated, to act for the Company to amend the SERP and to terminate the SERP. 6.04 No Contract of Employment. This Plan shall not constitute an express ------------------------- or implied contract of employment between the Company and any Participant. 6.05 Payment of Plan Expenses. The Company shall pay all expenses of ------------------------ establishing and administering the Plan. 6.06 Communications with Participants About the Plan. ----------------------------------------------- a. Communications to Participant. All notices, reports and other communications concerning the Plan from the Company or the Administrator to any Participant or other person required or permitted under the Plan shall be deemed to have been duly given to the person: i. when delivered to the person; or ii. when mailed by first-class mail or its equivalent, postage prepaid and addressed to the person at the address of the person most recently appearing on the records of the Administrator; b. Communications from Participants. All elections, designations, requests, notices, instructions and other communications from a Participant or other person to the Company or the Administrator required or permitted under the Plan shall be in a form prescribed by or acceptable to the Company or the Administrator, shall be mailed by first-class mail (or its equivalent) or delivered in person to the Company or the Administrator, and shall be deemed to have been given and delivered only upon actual receipt by the Company or the Administrator. c. Participant Access to Plan Records. A Participant shall have access to the Plan's documents and the portion of the Plan's records directly relating to the Participant's Plan benefits 9 but shall have no right to inspect Plan records generally or as they relate to the Plan benefits or other Participants. 6.07 Severability. If any term or provision hereof is determined to be ------------ invalid or unenforceable in a final court or arbitration proceeding, (a) the remaining terms and provisions hereof shall be unimpaired and (b) the invalid or unenforceable term or provision shall be deemed replaced by a term or provision that is valid and enforceable and that comes closest to expressing the intention of the invalid or unenforceable term or provision. 6.08 Execution of the Plan Document. In witness of the foregoing, this ------------------------------ SERP document has been executed on behalf of the Company by the undersigned duty authorized officer of the Company. TRANS-LUX CORPORATION By /s/ Angela D. Toppi ----------------------------- Date December 31, 2008 Its Executive Vice President -------------------------- ---------------------------- Date: December 31, 2008 By: Michael R. Mulcahy -------------------------- ---------------------------- /s/ Michael R. Mulcahy ---------------------------- (signature) 10 EX-10.2 3 mmamendment.txt EMPLOYMENT AGREEMENT M. MULCAHY This is an amendment and restatement of the AGREEMENT made February 22, 2005 effective as of the 1st day of April 2005 by and between TRANS-LUX CORPORATION, a Delaware corporation having an office at 26 Pearl Street, Norwalk, CT 06850 (hereinafter called "Employer"), and MICHAEL R. MULCAHY residing at 24 Beeholm Road, Redding, CT 06896 (hereinafter called, "Employee"). This amended and restated agreement is made effective January 1, 2009. W I T N E S S E T H: WHEREAS, Employer and Employee have entered into the Agreement; and WHEREAS, Section 409A of the Internal Revenue Code, and regulations and guidance issued thereunder, including IRS Notice 2007-34 (the "409A Requirements") require deferred compensation arrangements as defined therein to be in compliance by December 31, 2008 and Employer and Employee desire to enter into this Amendment to satisfy such 409A Requirements, it being understood nothing contained in this Amendment is intended to increase any compensation or other benefits to Employee in order to comply with the 409A Requirements; NOW, THEREFORE, THE PARTIES AGREE AS FOLLOWS: 1. Employer hereby employs Employee, and Employee hereby accepts employment, upon the terms and conditions hereinafter set forth. 2. (a) The term ("Term") of the Agreement shall be the five year period commencing April 1, 2005 and terminating March 31, 2010. (b) In the event that Employee remains or continues in the employ of Employer after the Term, such employment, in the absence of a further written agreement, shall be on an at-will basis, terminable by either party hereto on thirty (30) days' notice to the other and, upon the 30th day following such notice, the employment of Employee shall terminate. (c) Upon expiration of the Term of this Agreement, neither party shall have any further obligations or liabilities to the other except as otherwise specifically provided in this Agreement. 3. Employee shall be employed in an executive capacity of Employer (and such of its affiliates, divisions and subsidiaries as Employer shall designate). Employer shall use its best efforts to cause Employee to be elected and continue to be elected President and Chief Executive Officer 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, and the Vice-Chairman of the Board, provided, however, that the duties assigned shall be of a character and dignity appropriate to a senior executive of a corporation and consistent with Employee's background and experience, 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. Employee shall devote his entire time, attention and energies during usual business hours (subject to Employer's policy with respect to vacations, holidays and illnesses for comparable executives of Employer) to the business and affairs of Employer, its affiliates, divisions and subsidiaries as Employer shall from time to time direct. Employee further agrees during the Term of this Agreement to serve as an officer or director of Employer or of any affiliate or subsidiary of Employer as Employer may request, and if Employee serves as such officer or a director he will do so without additional compensation, other than director's fees or honoraria, if any. Subject to execution of this Agreement, Employee has been nominated as a director of Employer for election at Employer's 2005 Annual Meeting of Stockholders, but Employer cannot guaranty that Employee will be so elected by the stockholders, and the failure of Employee to be so elected as director of Employer shall not constitute breach of this Agreement. Employer agrees that during the Term of this Agreement Employee's principal office of employment shall be within a sixty (60) mile radius of Norwalk, Connecticut. During the Term of this Agreement and during any subsequent employment of Employee by Employer, Employee shall use his best efforts, skills and abilities in the performance of his services hereunder and to promote the interests of Employer, its affiliates, divisions and subsidiaries. Employee shall not, during the Term and during any subsequent employment of Employee by Employer, be engaged in any other business activity, whether or not such business activity is pursued for gain, profit or other pecuniary advantage. The foregoing shall not be construed as preventing Employee from investing his assets in such form or manner as will not require any services on the part of Employee in the operation of the affairs of the companies in which such investments are made, provided, however, that Employee shall not, either directly or indirectly, be a director of or make any investments in any company or companies which are engaged in businesses competitive with those conducted by Employer or by any of its subsidiaries or affiliates except where such investments are in stock of a company listed on a national securities exchange, and such stock of Employee does not exceed one percent (1%) of the outstanding shares of stock of such listed company. Employee shall not at any time during or after the Term of this Agreement use (except on behalf of Employer), divulge, furnish or make accessible to any third person or organization any confidential information concerning Employer or any of its subsidiaries or affiliates or the businesses of any of the foregoing including, without limitation, confidential methods of operations and organization, confidential sources of supply, identity of employees, customer lists and confidential financial information. In addition, Employee agrees that all lists, materials, books, files, reports, correspondence, records and other documents and information ("Employer Materials") used, prepared or made available to Employee, shall be and shall remain the property of Employer. Upon the termination of employment of Employee or the expiration of this Agreement, whichever is earlier, all Employer Materials shall be immediately returned to Trans-Lux Corporation, and Employee shall not make or retain any copies thereof: nor disclose or otherwise use any information relating to said Employer Materials to any other party. As used herein the term Employer shall include Employer, Employer's subsidiaries and affiliates, and any individuals employed during the term of their employment, by any of them. 4. (a) For all services rendered by Employee during the Term of this Agreement, Employer shall pay Employee a salary at the rate of TWO HUNDRED EIGHTY THOUSAND DOLLARS ($280,000) per annum during each of the periods April 1, 2005 to March 31, 2006, April 1, 2006 to March 31, 2007, April 1, 2007 to March 31, 2008, April 1, 2008 to March 31, 2009 and April l, 2009 to March 31, 2010 and subject to the CPI Adjustment, as hereinafter defined, for each future calendar year subsequent to 2005. The payments to be made to Employee for the twelve month periods commencing April, 2006, 2007, 2008 and 2009 shall each be appropriately adjusted upward ("CPI Adjustment") for inflation in the prior calendar year at the beginning of each such twelve month period based on the United States Department of Labor Bureau of Labor Statistics, Consumer Price Index, United States City Average, all items (2006 = 100). 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. 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 continue to provide Employee with term 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. The Employer shall transfer such policy to Employee on his retirement or termination of this Agreement by either party without cause. 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 for the above mentioned $75,000 policy would have been at the standard rates. Upon termination of this Agreement as a result of expiration of the Term (without any new agreement), or termination by either party of any at-will employment basis or either the Employee's retirement or discharge without cause, Employer agrees to pay for (i) continuation of coverage of Employee's present $75,000 life insurance for one (1) year and, (ii) unless Medicare or equivalent is in effect, medical insurance coverage, for Employee and his present spouse for the period of time coverage is available under COBRA, not to exceed eighteen (18) months and, thereafter for additional months so that the maximum time period for medical coverage is three (3) years, provided, however, any such coverage shall cease at Employee's 65th birthday (or in the case of his spouse, what would have been Employee's 65th birthday if he dies during such time period). (b) Employer may make appropriate deductions from the said payments required to be made in this Section 4 to Employee to comply with all governmental withholding requirements. (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 being disabled for four (4) consecutive months (excluding normal vacation time) during the Term hereof, Employer agrees to pay Employee thereafter for the duration of such incapacity (i) during the Term, or (ii) 24 months, whichever is greater, 50% of the base salary which Employee would otherwise have been entitled to receive (in the same form and on the same schedule) if not for the disability; provided, however, if such 4(c) shall terminate and Section 7 shall apply. If payments under Section 7 cease because of Employee's death prior to the end of the 24 month period under this Section 4(c), then the balance of the payments hereunder will be made, for example, if Employee has received 6 months of disability payments before the Term expires and dies after receiving 12 months of payments under Section 7, then Employee's widow or surviving issue will receive the remaining 6 months of payments under this Section 4(c). If Employee dies during such 24 month period prior to the end of the Term, then Section 4(e) shall apply and the payments under this Section 4(c) shall terminate. For purposes of this Agreement, a Employee shall be considered to be "disabled" or have a "disability" if the Employee meets one of the following requirements: (A) The Employee is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than 12 months. (B) The Employee is, by reason of any medically determinable physical or mental impairment expected to last for a continuous period of not less than 12 months, receiving income replacement benefits for a period of not less than three months under an accident and health plan covering employees of the Company. A Employee will be deemed to be disabled if determined to be totally disabled by the Social Security Administration or in accordance with a disability insurance program that applies a definition of disability that is at least as restrictive as the foregoing description in this Section 4(c). (d) The Board, upon the recommendation of the Compensation Committee of the Board, shall consider the grant of a bonus ("Bonus") to Employee based on Employer's performance for Employer's immediately preceding fiscal year for each of 2006, 2007, 2008, 2009, 2010 and 2011. Such Bonus, if awarded, and unless otherwise deferred by Employee, shall be paid on the May 31st following the end of the applicable fiscal year. Employee hereby agrees to defer payment of any Bonus for any fiscal year commencing with the 2009 fiscal year until the June 1 following the end of the applicable fiscal year. Employee hereby acknowledges the restrictions on changing such deferral to another date. Notwithstanding the foregoing, Employer shall pay Employee the Bonus rate applicable for each level of annual pre-tax consolidated earnings for any of the fiscal years ending December 31, 2005 (including the period January 1-March 31, 2005 as provided hereafter in Section 13), 2006, 2007, 2008, 2009 and 2010 only, (provided however that the Bonus, if any, for 2010 shall be 25% 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 $150,000 for any year ($37,500 for January 1-March 31, 2010). Amount of Annual Pre-Tax Bonus Percent Highest Amount Consolidated Earnings On Amount Pre Level --------------------- --------- --------- $ 0 - $ 1,000,000 2 1/2% $ 25,000 $ 1,000,000 - 2,000,000 3 1/4% 32,500 $ 2,000,000 - 4,312,500 4% 92,500 -------- $150,000 (highest aggregate bonus) No Bonus shall be payable for annual pre-tax consolidated earnings less than $500,000 or in excess of $4,312,500. 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, (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, or (z) any contractual Bonuses and or contractual profit participations accrued or paid to Employee and other employees. 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 2005, 2006, 2007, 2008 and 2009 fiscal years, or on March 31, 2010 no Bonus shall be paid for such fiscal year or part thereof as to 2009. In the event of Employee's death on or after January 1 of 2006, 2007, 2008, 2009 or 2010, or April 1, 2010 as to 2010, any Bonus to which he is otherwise entitled for the prior fiscal year or 2010, 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. Notwithstanding the foregoing, any interest expense savings resulting from conversion of the Employer's 7 1/2 % Convertible Subordinated Notes due 2006 and 8 1/4% Limited Convertible Senior Subordinated Notes due 2012 may be included or excluded in such calculation by the Board in its sole discretion. Employer undertakes to use reasonable efforts to cause said accountants to prepare and furnish such statements promptly following 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. (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 twenty-four (24) months, annual death benefits payable weekly or in accordance with Employer's payroll practices in an amount equal to 50% of Employee's then annual base salary rate. (f) Employer agrees to continue to provide Employee with split dollar life insurance in the initial face amount of $500,000 with paid-up additions from dividends for up to the first 20 years of the policy in accordance with Male Smoker Age 50 Presentation annexed hereto as Exhibit B. In the event and at such time as Employee stops smoking in accordance with the insurance company's regulations, any premium reductions resulting there from shall be utilized to purchase additional life insurance for Employee under separate policies in accordance with the available offerings. Employee hereby waives all cash surrender rights under such policy and other benefits, if any, except for the death benefit payable to beneficiaries. (g) In addition, Employer agrees to provide to Employee and his beneficiaries (''Beneficiaries'') as additional supplemental retirement benefits ("ASRB"), an amount so that the aggregate retirement benefits payable to Employee and Beneficiaries under the Retirement Pension Plan for Employees of Trans-Lux Corporation and Certain of its Subsidiaries and/or Affiliates (''Plan'') plus such ASRB will equal the amount which would have been payable to Employee and Beneficiaries under the Plan but for (i) the limitations on the maximum annual benefits imposed by Section 415 of the Internal Revenue Code of 1986 (''IRC''), (ii) the limitations on the amount of annual compensation which may be taken into account under Section 401(a)(17) of the IRC, and (iii) any further limitations in benefits under the Plan resulting from statutory changes or from modifications in the Plan required by statutory changes after December 31, 2001. It is understood that the purpose of this paragraph is that (a) Employee and Beneficiaries shall receive as a result of the ASRB payment, the full benefit which would otherwise have been payable from the Plan had no Plan or statutory restrictions been imposed by law, and (b) that any additional taxes payable by Employee on any ASRB payment as a result of such Plan or statutory restrictions shall be paid to Employee by Employer grossed up in such manner as to offset the effect of Employee's state and federal income taxes on such payments. The obligations of Employer payable pursuant to this subparagraph (g) are intended to be unfunded for income tax purposes and shall not constitute a trust fund, escrow amount, amount set apart, or other account credited with funds for the benefit of Employee or his Beneficiaries. 5. During the Term of this Agreement, Employer will reimburse Employee for traveling or other out-of-pocket expenses and disbursements incurred by Employee with Employer's approval in furtherance of the businesses of Employer, its affiliates, divisions or subsidiaries, upon presentation of such supporting information as Employer may from time to time request. 6. During the Term of this Agreement, Employee shall be entitled to a vacation during the usual vacation period of Employer in accordance with such vacation schedules as Employer may prescribe. 7. Both parties recognize that the services to be rendered by Employee pursuant to this Agreement are extraordinary and unique. During the Term of this Agreement, and during any subsequent employment of Employee by Employer, Employee shall not, directly or indirectly, enter into the employ of or render any services to any person, partnership, association or corporation engaged in a business or businesses in any way, directly or indirectly, competitive to those now or hereafter engaged in by Employer or by any of its subsidiaries during the Term of this Agreement and during any subsequent employment of Employee by Employer and Employee shall not engage in any such business, directly or indirectly on his own account and, except as permitted by Section 3 of this Agreement, Employee shall not become interested in any such business, directly or indirectly, as an individual, partner, shareholder, director, officer, principal, agent, employee, trustee, consultant, or in any other relationship or capacity. For a period of two (2) years following termination of employment, Employee shall not directly or indirectly (i) engage or otherwise he involved in the recruitment or employment of the Employer's employees or any individual who was such an employee within one (1) year of any such termination of employment, (ii) solicit or assist in obtaining business from a customer of the Employer who was a customer during the two (2) year period prior to termination of employment, with respect to comments regarding Employer, or (iii) communicate, publish, or otherwise transmit, in any manner whatsoever, untrue or negative information or comments regarding Employer. Employer shall be entitled, if it so elects, to institute and prosecute proceedings in any court of competent jurisdiction, either in law or in equity, to obtain damages for any breach of this Agreement, or to enjoin Employee from any breach of this Agreement, but nothing herein contained shall be construed to prevent Employer from pursuing such other remedies as Employer may elect to invoke. In the event Employee separates from the service of the Employer (or successor to Employer which assumes this Agreement) and all members of the Corporate Group at the end of the Term or the end of the term of any "proposed renewal contract" as hereinafter set forth in this Section, then, except as hereinafter provided, Employer shall pay to Employee weekly or bi-weekly in accordance with Employer's payroll practices as severance pay, an amount equal to one hundred percent (100%) of Employee's base salary under Section 4(a) in effect at time of termination of employment (e.g., at rate of $280,000 plus CPI Adjustment per annum if termination is April 1, 2010) for a period of three (3) years, or until Employee reaches age 65 or until Employee's death, whichever first occurs. The foregoing severance payments shall not apply if (i) Employee is discharged for cause or (ii) Employee rejects a "proposed renewal contract" having a term of at least three (3) years and otherwise having at least the same terms and conditions as in effect on March 31, 2010, or at the end of the term of any subsequent renewal contract, provided no such renewal contract will continue past Employee's 65th birthday and will automatically terminate on such date unless the parties otherwise mutually agree in writing. Furthermore, if Employee violates the confidentiality clause in Section 3 or violates or challenges the enforceability of any of the clauses of this Section 7, Employer may, in addition to all other remedies to which it is entitled, cease the payments under this Section 7. The severance pay hereunder is not payable in the event Employee dies during the Term or for any time period following his death during the above severance pay period. In the event Employee is disabled at the end of the Term and receiving payments under Section 4(c), then the payment under this Section 7 shall be at the rate of fifty percent (50%), and not one hundred percent (100%), of Employee's base salary under Section 4(a) in effect at time of termination of employment and shall be in lieu of any payments under Section 4(c) which payments shall terminate so that there is no duplication of payment; provided, however, if such disability ceases prior to the end of the two (2) year time period, the payment rate shall be one hundred percent (100%) so long as any disability does not recur. During the period in which Employer makes payment to Employee under this Section 7, Employee agrees to be available for reasonable telephonic consultation as to matters Employee worked on during the Term. Notwithstanding the foregoing, no payment shall be made to the Employee on account of severance prior to the first day of the seventh month following separation from service. Payments delayed as a result of this provision shall be made in a lump sum in the first payment of severance that coincides with or next follows the first day of the seventh month following the Employee's separation from service. 8. In the event any provision of Section 7 of this Agreement shall be held invalid or unenforceable by reason of the geographic or business scope or the duration thereof, such invalidity or unenforceability shall attach only to such provision and shall not affect or render invalid or unenforceable any other provision of this Agreement, and this Agreement shall be construed as if the geographic or business scope or the duration of such provision had been more narrowly drawn so as not to be invalid or unenforceable. 9. (a) Employee shall have the right to cancel and terminate this Agreement effective within 75 days following a "Change in Control" as hereinafter defined provided that Employee give 75 days' prior written notice to the Employer. Upon such termination becoming effective pursuant to such notice by Employee, (a) Employer and Employee shall be released from all further liability and obligations provided for in the Agreement, except that Employee shall still be subject to and bound by his obligations under Section 7 as modified herein; (b) Employer shall pay to Employee his Bonus for the prior calendar year (if not previously paid) as and to the extent provided for in Section 4 (d); and (c) Employee shall be paid in a lump sum on the effective date of termination the amount of $1,200,000. If Employee is disabled at the time of this notice under this Section 9(a), the above payments shall be in lieu of the payments provided under Section 4(c) which payments shall cease and terminate at the end of the 75 day notice period. In the event of Employee's death during the 75 day notice period, any amounts still payable to Employee by reason of such termination 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. The notice under this Section 9 must be given within 60 days of the occurrence of the applicable event or be deemed waived. To the extent any such payments made pursuant to this Section 9(a) above are deemed to be an "excess parachute payment" under Section 2800 of the Internal Revenue Code of 1986, as amended (the "Code") and are subject to tax pursuant to Section 4999 of the Code, such payments shall be grossed up in such a manner as to offset the effect of such excise tax on such payments. For purpose of this Section 9, the phrase "Change in Control" shall have the meaning set forth in Section 9(d). For further purposes of this Section 9(a) or in the event Employer rejects this Agreement in a proceeding for relief under Chapter 11 of the Bankruptcy Code, then, in either such case, the restriction in Section 7(ii) shall only apply to a customer of Employer who was a customer during the six (6) month period prior to termination of employment with respect to replacing Employer's leased products with competitor's purchased or leased products or Employer's service contracts with replacement service contracts for Employer's equipment, as long as such service or lease agreement is in effect (including continuation of use or other extension beyond the termination date thereof). The restrictions in Section 7(i) and (iii) shall continue without modification, but the obligation to provide telephonic consulting shall terminate. (b) In the event there is a Change in Control when a change in the majority of the Board of Directors is approved by Richard Brandt (or, in the event of his death, a majority of David Brandt, Matthew Brandt and Thomas Brandt) then, notwithstanding such approval, (i) the Term of this Agreement shall be extended for an additional three (3) years (each an "extended year") through March 31, 2013, (ii) the salary during each such extended year shall be at the higher of the annual rate of Two Hundred Ninety Five Thousand Dollars ($295,000) or the salary rate in effect on March 31,2010 based on the CPI Adjustment, (iii) the salary shall continue to be adjusted by the CPI Adjustment for the last two years of the extended Term based on the increase from April 1, 2010, and (iv) Employee shall be entitled to a Bonus for each such extended year equal to the greater of the Bonus rate in effect for 2009 or the highest annual Bonus paid Employee during the five (5) calendar year period preceding such approved Change in Control. In the event of a Change in Control, services rendered by Employee for the balance of the Term will be of a type, dignity and nature appropriate to the President and Chief Executive Officer of the Employer and of similar responsibility and authority as then being rendered. (c) In the event of a Change in Control under either (x) Section 9(a), whether or not Employee terminates this Agreement, or (y) Section 9(b) above, then Employer shall give Employee, (i) to the extent Employee did not receive credit for service because a freeze was in effect, additional ASRB under Section 4(g) under the present Plan for the amount of such credit not realized because of the freeze; and (ii) if the Employer discontinues such Plan, (x) additional ASRB for the amount of credit for service not realized because of discontinuance, and (y) ASRB as provided in Section 4(g) as if such Plan had not been discontinued. (d) For purpose of this Section 9, the phrase "Change in Control" shall be deemed to have occurred if both the conditions in (i) and (ii) are satisfied, such that both the Change in Control requirement in the Agreement prior to its amendment and restatement and the Change in Control definition specified in the final 409A regulations must be satisfied for the foregoing rights to be exercised. (i) A "Change in Control" shall occur if (x) any person (as such term is used in Sections l3(d) and 14(d)(2) of the Securities Exchange Act of 1934) hereafter becomes the beneficial owner, directly or indirectly, of securities of Employer, representing 25% or more of the combined voting power of the Employer's then outstanding securities (other than Richard Brandt and/or members of his family, directly or indirectly through trusts or otherwise), and (y) during any period of two (2) consecutive years, individuals who at the beginning of such period constitute the Board of Directors of Employer cease by reason of a contested election to constitute at least a majority thereof; unless Richard Brandt (or, in the event of his death, a majority of David Brandt, Matthew Brandt and Thomas Brandt) shall have approved such change in the majority. For further purposes of this Section 9(a) or in the event Employer rejects this Agreement in a proceeding for relief under Chapter 11 of the Bankruptcy Code, then, in either such case, the restriction in Section 7(ii) shall only apply to a customer of Employer who was a customer during the six (6) month period prior to termination of employment with respect to replacing Employer's leased products with competitor's purchased or leased products or Employer's service contracts with replacement service contracts for Employer's equipment, as long as such service or lease agreement is in effect (including continuation of use or other extension beyond the termination date thereof). The restrictions in Section 7(i) and (iii) shall continue without modification, but the obligation to provide telephonic consulting shall terminate. (ii) Change in Control means a change in ownership as described in paragraph (A), a change in effective control as described in paragraph (B), or a change in ownership of a substantial portion of the assets of (1) the Company or the member of the Corporate Group for whom the Employee is performing services at the time of the Change in Control, (2) the corporation that is liable for the payment of the deferred compensation under the Plan (or all corporations liable for the payment if more than one corporation is liable) or (3) a corporation that is a majority shareholder of the corporation identified in (1) or (2), or any corporation in a chain of corporations in which each corporation is a majority shareholder of another corporation in the chain, ending in a corporation identified in (1) or (2) (individually and collectively, the "Corporation"). (A) Change in Ownership. A change in the ownership occurs on the date that any one person, or more than one person acting as a group (as defined in paragraph (D)), acquires ownership of stock of the Corporation that, together with stock held by such person or group, constitutes more than 50 percent of the total fair market value or total voting power of the stock of such Corporation. However, if any one person or more than one person acting as a group, is considered to own more than 50 percent of the total fair market value or total voting power of the stock of the Corporation, the acquisition of additional stock by the same person or persons is not considered to cause a change in the ownership of the corporation (or to cause a change in the effective control of the corporation (as described in paragraph (B)). An increase in the percentage of stock owned by any one person, or persons acting as a group, as a result of a transaction in which the Corporation acquires its stock in exchange for property will be treated as an acquisition of stock for purposes of this section. This paragraph (A) applies only when there is a transfer of stock of the Corporation (or issuance of stock of the Corporation) and stock in such Corporation remains outstanding after the transaction. (B) Change in the effective control of the Corporation. Notwithstanding that the Corporation has not undergone a change in ownership under paragraph (A), a change in the effective control of a corporation occurs on the date that either - (1) Any one person, or more than one person acting as a group (as determined under paragraph (E)), acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by such person or persons) ownership of stock of the Corporation possessing 30 percent or more of the total voting power of the stock of such corporation; or (2) a majority of members of the Corporation's board of directors is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of the Corporation's board of directors prior to the date of the appointment or election, provided that for purposes of this paragraph (2) the term Corporation refers solely to the relevant corporation identified in paragraph (i) for which no other corporation is a majority shareholder for purposes of that paragraph. (3) Multiple Change in Control Events. A change in effective control also may occur in any transaction in which either of the two corporations involved in the transaction has a Change in Control under paragraph (A) or (C). In the absence of an event described in paragraph (1), (2), or (3) a change in the effective control of a Corporation will not have occurred. Further, if any one person, or more than one person acting as a group, is considered to effectively control a Corporation, the acquisition of additional control of the Corporation by the same person or persons is not considered to cause a change in the effective control of the Corporation (or to cause a change in the ownership of the corporation within the meaning of paragraph (b). (C) Change in the ownership of a substantial portion of a Corporation's assets. A change in the ownership of a substantial portion of a Corporation's assets occurs on the date that any one person, or more than one person acting as a group (as determined in paragraph (E)), acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by such person or persons) assets from the Corporation that have a total gross fair market value equal to or more than 40 percent of the total gross fair market value of all of the assets of the Corporation immediately prior to such acquisition or acquisitions. For this purpose, gross fair market value means the value of the assets of the Corporation, or the value of the assets being disposed of, determined without regard to any liabilities associated with such assets. (D) Transfers to a related person. Notwithstanding the foregoing, there is no Change in Control under paragraph (C) when there is a transfer to an entity that is controlled by the shareholders of the transferring corporation immediately after the transfer, as provided in this paragraph (D). A transfer of assets by a corporation is not treated as a change in the ownership of such assets if the assets are transferred to - (1) A shareholder of the Corporation (immediately before the asset transfer) in exchange for or with respect to its stock; (2) An entity, 50 percent or more of the total value or voting power of which is owned, directly or indirectly, by the Corporation; (3) A person, or more than one person acting as a group, that owns, directly or indirectly, 50 percent or more of the total value or voting power of all the outstanding stock of the Corporation; or (4) An entity, at least 50 percent of the total value or voting power of which is owned, directly or indirectly, by a person described in paragraph (3). For purposes of this paragraph (D) and except as otherwise provided, a person's status is determined immediately after the transfer of the assets. For example, a transfer to a corporation in which the transferor corporation has no ownership interest before the transaction, but which is a majority-owned subsidiary of the transferor corporation after the transaction is not treated as a change in the ownership of the assets of the transferor corporation. (e) Persons acting as a group. For purposes of paragraphs (A), (B) and (C), persons will not be considered to be acting as a group solely because they purchase or own stock or purchase assets of the same corporation at the same time, or as a result of the same public offering. However, persons will be considered to be acting as a group if they are owners of a corporation that enters into a merger, consolidation, purchase or acquisition of stock, or similar business transaction with the corporation. If a person, including an entity, owns stock in both corporations that enter into a merger, consolidation, purchase or acquisition of stock, or similar transaction, such shareholder is considered to be acting as a group with other shareholders in a corporation only with respect to and to the extent of the ownership in that corporation prior to the transaction giving rise to the change and not with respect to the ownership interest in the other corporation. (f) Stock ownership. Code Section 318(a) shall apply for purposes of determining stock ownership under this Section. 9. The waiver by Employer of a breach of any provision of this Agreement by Employee shall not operate or be construed as a waiver of any subsequent breach by Employee. 10. Any notice required or permitted to be given under this Agreement shall be sufficient if in writing and served personally or sent by United States certified or registered mail, return receipt requested, or overnight courier such as Federal Express or Airborne to his address as stated on Employer's records, in the case of Employee, or to the office of Trans-Lux Corporation, attention of the Chairman or Chief Financial Officer, 26 Pearl Street, Norwalk 06850, in the case of Employer, or such other address as designated in writing by the parties. 11. This Agreement shall be construed in accordance with the laws of the State of New York. 12. This instrument contains the entire agreement between the parties and supersedes as of January 1, 2009 the Agreement between Employer and Employee dated as of April l, 2005 as amended. It may not be changed, modified, extended or renewed orally except by an agreement in writing signed by the party against whom enforcement of any waiver, change, modification, discharge or extension is sought. IN WITNESS WHEREOF, this Agreement has been duly executed on this 31st day ---- of December, 2008. TRANS-LUX CORPORATION By: /s/ Angela D. Toppi ------------------------------------- Executive Vice President /s/ Michael R. Mulcahy ------------------------------------- Michael R. Mulcahy (as "Employee") President and Chief Executive Officer 13 EX-10.3 4 amamendment.txt EMPLOYMENT AGREEMENT A. MILLER This is an amendment and restatement of the AGREEMENT made as of the 1st day of April, 2008 by and between TRANS-LUX CORPORATION, a Delaware corporation having an office at 26 Pearl Street, Norwalk, Connecticut 06850 (hereinafter called "Employer"), and AL MILLER residing at 22 Deer Run Lane, Shelton, Connecticut 06484 (hereinafter called, "Employee"). This amendment and restatement is effective as of April 1, 2008. W I T N E S S E T H: - - - - - - - - - - WHEREAS, Employer and Employee have entered into the Agreement; and WHEREAS, Section 409A of the Internal Revenue Code, and regulations and guidance issued thereunder, including IRS Notice 2007-34 (the "409A Requirements") require deferred compensation arrangements as defined therein to be in compliance by December 31, 2008 and Employer and Employee desire to enter into this Amendment to satisfy such 409A Requirements, it being understood nothing contained in this Amendment is intended to increase any compensation or other benefits to Employee in order to comply with the 409A Requirements; NOW, THEREFORE, THE PARTIES AGREE AS FOLLOWS: 1. Employer hereby employs Employee, and Employee hereby accepts employment, upon the terms and conditions hereinafter set forth. 2. (a) The term ("Term") of the Agreement shall be the period commencing on April l, 2008 and terminating March 3l, 2009. (b) In the event that Employee remains or continues in the employ of Employer after the Term, such employment, in the absence of a further written agreement, shall be on an at-will basis, terminable by either party hereto on thirty (30) days' notice to the other and, upon the 30th day following such notice the employment of Employee shall terminate. (c) Upon expiration of the Term of this Agreement, neither party shall have any further obligations or liabilities to the other except as otherwise specifically provided in this Agreement. 3. Employee shall be employed in an executive capacity of Employer (and such of its affiliates, divisions and subsidiaries as Employer shall designate). Employer shall use its reasonable 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 President and Chief Executive Officer, 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 President and Chief Executive Officer and the Board of Directors of Employer, to which Employee does hereby agree to be bound. Employee shall devote his entire time, attention and energies during usual business hours (subject to Employer's policy with respect to holidays and illnesses for comparable executives of Employer) to the business and affairs of Employer, its affiliates, divisions and subsidiaries as Employer shall from time to time direct. Employee further agrees during the Term of this Agreement to serve as an officer or director of Employer or of any affiliate or subsidiary of Employer as Employer may request, and if Employee serves as such officer or a director he will do so without additional compensation, other than director's fees or honoraria, if any. During the Term of this Agreement and during any subsequent employment of Employee by Employer, Employee shall use his best efforts, skills and abilities in the performance of his services hereunder and to promote the interests of Employer, its affiliates, divisions and subsidiaries. Employee shall not, during the Term and during any subsequent employment of Employee by Employer, be engaged in any other business activity, whether or not such business activity is pursued for gain, profit or other pecuniary advantage, except for current real estate ventures disclosed to Employer concurrently with the signing of this Agreement. The foregoing shall not be construed as preventing Employee from investing his assets in such form or manner as will not require any services on the part of Employee in the operation of the affairs of the companies in which such investments are made, provided, however, that Employee shall not, either directly or indirectly, be a director of or make any investments in any company or companies which are engaged in businesses competitive with those conducted by Employer or by any of its subsidiaries or affiliates except which such investments are in stock of a company listed on a national securities exchange, and such stock of Employee does not exceed one percent (1%) of the outstanding shares of stock of such listed company. Employee shall not at any time during or after the Term of this Agreement use (except on behalf of Employer), divulge, furnish or make accessible to any third person or organization any confidential information concerning Employer or any of its subsidiaries or affiliates or the businesses of any of the foregoing including, without limitation, confidential methods of operations and organization, confidential sources of supply, identity of employees, customer lists and confidential financial information. 4. (a) For all services rendered by Employee during the Term of this Agreement, Employer shall pay Employee a salary at the rate of ONE HUNDRED FIFTY SEVEN THOUSAND DOLLARS ($157,000) per annum during the period April l, 2008 to September 30, 2008; and at the rate of ONE HUNDRED SIXTY-ONE THOUSAND FIVE HUNDRED DOLLARS ($161,500) per annum during the period October 1, 2008 to March 31, 2009. 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 his and for its employees generally. Such rights and benefits currently include a performance bonus and sales override plan, the terms of which are subject to revision by the Employer each year during the Term of this Agreement. The performance bonus and sales override target amount of earnings shall be $45,000 for 2008 and $11,250 for the period January 1-March 31, 2009. The maximum earnings under this plan shall not exceed two times the target amount for any of the full calendar year 2008 and $11,250 for January 1-March 31, 2009. 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. All payments under this Agreement are in United States dollars unless otherwise specified. (b) Employer may make appropriate deductions from the said payments required to be made in this Section 4 to Employee to comply with all governmental withholding requirements. (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 disability for four (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, but in no event less than ninety (90) days, 40% of the base salary which Employee would otherwise have been entitled to receive if not for the illness or other incapacity. For purposes of this Agreement, an Employee shall be considered to be "disabled" or have "disability" if the Employee meets one of the following requirements: (A) The Employee is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than 12 months. (B) The Employee is, by reason of any medically determinable physical or mental impairment expected to last for a continuous period of not less than 12 months, receiving income replacement benefits for a period of not less than three months under an accident and health plan covering employees of the Company. An Employee will be deemed to be disabled if determined to be totally disabled by the Social Security Administration or in accordance with a disability insurance program that applies a definition of disability that is at least as restrictive as the foregoing description in this Section 4(c). (d) The Board upon the recommendation of the Compensation Committee of the Board shall consider the grant of a bonus ("Bonus") to Employee based on Employer's performance for the immediately preceding fiscal years 2008 and 2009, respectively. Notwithstanding the foregoing, based on Employer's annual pre-tax consolidated earnings for the applicable fiscal year, Employer shall pay Employee a Bonus at the rate of one-half of one percent (1/2 of 1%) of the annual pre-tax consolidated earnings for the fiscal years ending December 31, 2008 and 2009 (including the period January 1-March 31, 2009 as herewith provided in Section 12) only, in the event Employer's pre-tax consolidated earnings for such year determined in accordance with Section 4(d) exceeds $500,000, provided that this Bonus shall not exceed $40,000 for 2008, and the Bonus, if any, for January 1-March 31, 2009 shall be 25% of the amount for the year 2009, not to exceed $10,000). 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. Employee hereby agrees to defer payment of any Bonus based on the attainment of annual objectives (including those set forth in separate bonus plans) for any fiscal year commencing with the 2009 fiscal year until June 1 following the end of the applicable fiscal year. Employee hereby acknowledges the restrictions on changing the deferral to another date. Notwithstanding anything to the contrary contained herein, if Employee is not in the employ of Employer at the end of the aforesaid 2008 fiscal year or March 31, 2009, no Bonus shall be paid for such fiscal year or part thereof as to 2009. In the event of Employee's death on or after January 1 of 2009 or March 31, 2009 as to 2009, any Bonus to which he is otherwise entitled for the prior fiscal year shall be paid to his surviving spouse 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. Employer undertakes to use reasonable efforts to cause said accountants to prepare and furnish such statements promptly following 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. (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 surviving spouse or his surviving issue, as the case may be, for the balance of the Term of the Agreement, 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. 5. During the Term of this Agreement, Employer will reimburse Employee for traveling or other out-of-pocket expenses and disbursements incurred by Employee with Employer's approval in furtherance of the businesses of Employer, its affiliates, divisions or subsidiaries, upon presentation of such supporting information as Employer may from time to time request. 6. During the Term of this Agreement, Employee shall be entitled to a vacation during the usual vacation period of Employer in accordance with such vacation schedules as Employer may prescribe. 7. Both parties recognize that the services to be rendered by Employee pursuant to this Agreement are extraordinary and unique. During the Term of this Agreement, and during any subsequent employment of Employee by Employer, Employee shall not, directly or indirectly, enter into the employ of or render any services to any person, partnership, association or corporation engaged in a business or businesses in any way, directly or indirectly, competitive to those now or hereafter engaged in by Employer or by any of its subsidiaries during the Term of this Agreement and during any subsequent employment of Employee by Employer and Employee shall not engage in any such business, directly or indirectly on his own account and, except as permitted by paragraph 3 of this Agreement, Employee shall not become interested in any such business, directly or indirectly, as an individual, partner, shareholder, director, officer, principal, agent, employee, trustee, consultant, or in any other relationship or capacity. For a period of two (2) years following termination of employment for any reason, Employee shall not directly or indirectly (i) engage or otherwise be involved in the recruitment or employment of any Employer employee or, (ii) solicit or render any service directly or indirectly to any other person or entity with regard to soliciting any customer of the Employer during the two (2) year period prior to termination of employment with respect to products or services competitive with products or services of Employer. Employee shall at no time during or after employment disclose to any person, other than Employer, or otherwise use any information of or regarding Employer except on behalf of Employer, nor communicate, publish, or otherwise transmit, in any manner whatsoever, untrue information or negative, competitive, personal or other information or comments regarding Employer. In addition, Employee agrees that all lists, materials, books, files, reports, correspondence, records and other documents and information ("Employer Materials") used, prepared or made available to Employee, shall be and shall remain the property of Employer. Upon the termination of employment of Employee or the expiration of this Agreement, whichever is earlier, all Employer Materials shall be immediately returned to Trans-Lux Corporation, and Employee shall not make or retain any copies thereof, nor disclose or otherwise use any information relating to said Employer Materials to any other party. As used herein the term Employer shall include Employer, Employer's subsidiaries and affiliates, and any individuals employed or formerly employed by any of them. Employer shall be entitled, if it so elects, to institute and prosecute proceedings in any court of competent jurisdiction, either in law or in equity, to obtain damages for any breach of this Agreement, or to enjoin Employee from any breach of this Agreement, but nothing herein contained shall be construed to prevent Employer from pursuing such other remedies as Employer may elect to invoke. In addition to the obligations of the Employee contained in this Agreement, Employee agrees to be bound by the provisions contained in Exhibit A to this Agreement. 8. In the event any provision of paragraph 7 of this Agreement shall be held invalid or unenforceable by reason of the geographic or business scope or the duration thereof, such invalidity or unenforceability shall attach only to such provision and shall not affect or render invalid or unenforceable any other provision of this Agreement, and this Agreement shall be construed as if the geographic or business scope or the duration of such provision had been more narrowly drawn so as not to be invalid or unenforceable. 9. The waiver by Employer of a breach of any provision of this Agreement by Employee shall not operate or be construed as a waiver of any subsequent breach by Employee. 10. Any notice required or permitted to be given under this Agreement shall be sufficient if in writing and served personally or sent by United States certified or registered mail, return receipt requested, or overnight courier such as Federal Express or Airborne to his address as stated on Employer's records, in the case of Employee, or to the office of Trans-Lux Corporation, attention of the President and Chief Executive Officer, at the address set forth above, in the case of Employer, or such other address as designated in writing by the parties. 11. This Agreement shall be construed in accordance with the laws of the State of New York. 12. This instrument contains the entire agreement between the parties and supersedes as of April 1, 2008 the Agreement between Employer and Employee dated as of April 1, 2005, as amended except any amounts which accrued as of such date and are unpaid, but excluding the Bonus for the period January 1-March 31, 2008 which is covered by Section 4(d) hereof. It may not be changed, modified, extended or renewed orally except by an agreement in writing signed by the party against whom enforcement of any waiver, change, modification, discharge or extension is sought. IN WITNESS WHEREOF, this Agreement has been duly executed on this 31st ---- day of December, 2008. TRANS-LUX CORPORATION By: /s/ Michael R. Mulcahy ---------------------- President /s/ Al Miller ---------------------- Al Miller EX-10.4 5 movingimagesamendment.txt CONSULTING AGREEMENT AMENDMENT MOVING IMAGES December 31, 2008 Moving Images, LLC c/o David Brandt 113 Buckingham Road Upper Montclair, NJ 07043 Gentlemen: Reference is made to your Consulting Agreement with Trans-Lux Corporation ("TLX") made as of December 1, 2004 as heretofore amended (the "Agreement"). WHEREAS, Section 409A of the Internal Revenue Code and regulations and guidance issued thereunder, including IRS Notice 2007-34 (the 409A Requirements") require deferred compensation arrangements as defined therein to be in compliance by December 31, 2008 and TLX and Consultant desire to enter into this Amendment to satisfy such 409A Requirements, it being understood nothing contained in this Amendment is intended to increase any compensation or other benefits to Consultant in order to comply with the 409A Requirements; NOW, THEREFORE, THE PARTIES AGREE AS FOLLOW: 1. Section 3(f) of the Agreement, which provides for certain payments to be made to Consultant while Consultant or Richard Brandt is prevented from performing or unable to perform the duties specified by reason of illness or other incapacity, is amended such that the reference to such illness or other incapacity shall be deemed a reference to "disability" or "disabled" and subject to the following definitions: For purposes of the Agreement, Richard Brandt shall be considered to be "disabled" or have a "disability" if he meets one of the following requirements: (A) He is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than 12 months. (B) He is, by reason of any medically determinable physical or mental impairment expected to last for a continuous period of not less than 12 months, receiving income replacement benefits for a period of not less than three months under an accident and health plan covering Consultants of the Company. He will be deemed to be disabled if determined to be totally disabled by the Social Security Administration or in accordance with a disability insurance program that applies a definition of disability that is at least as restrictive as the foregoing description in this Section 3(f). 2. Sections 3(b) and 3(c) of the Agreement provide for Consultant to be granted a Profit Participation and Bonus (herein collectively "Bonus") as defined therein under certain circumstances. The 409A Requirements mandate such payments either be made by two and one half months following TLX's fiscal year end or normally March 15 of following year in absence of leap year, without any possibility of further deferral, or the Consultant make an election to defer the Bonus in accordance with the 409A Requirements. Accordingly, to enable TLX to avoid any risk of penalty in the event such March 15 date is not met, Consultant agrees to defer payment of any Bonus for any fiscal year commencing with 2009 until the June 1 following the end of such fiscal year. Consultant is aware of the restrictions on changing such deferral to another date. The last sentence of Section 3(b) of such Bonus provision on non-liability is still applicable to any delay in finalizing such financial results. Furthermore, the right of Consultant to receive Common Stock and/or Class A Stock as part or full payment of any Bonus in Section 3(d) is deleted. 3. Not used. 4. Sections 4(a) and 4(b) of the Agreement are amended by adding the following sentence: Consultant hereby waives all cash surrender rights under any such insurance policy and other benefits, if any, except for the death benefits payable to beneficiaries." 5. Sections 2(b) and 2(c) of the Agreement are amended by adding the following definition of Change of Control required by the 409A Requirements as an additional trigger so that both the Change in Control provision currently in the Agreement and the 409A Requirement definition must be satisfied since the 409A Requirement definition might enable Consultant to exercise rights under the Agreement even though the existing provision is not satisfied. (i) Change in Control under the 409A Requirements means a change in ownership as described in paragraph (A), a change in effective control as described in paragraph (B), or a change in ownership of a substantial portion of the assets of (1) the TLX or the member of the Corporate Group (i.e. its subsidiaries or any new parent corporation) for whom the Consultant is performing services at the time of the Change in Control, (2) the corporation that is liable for the payment of the deferred compensation under the Plan (or all corporations liable for the payment if more than one corporation is liable) or (3) a corporation that is a majority shareholder of the corporation identified in (1) or (2), or any corporation in a chain of corporations in which each corporation is a majority shareholder of another corporation in the chain, ending in a corporation identified in (1) or (2) (individually and collectively, the "Corporation"). (A) Change in Ownership. A change in the ownership occurs on the date that any one person, or more than one person acting as a group (as defined in paragraph (D)), acquires ownership of stock of the Corporation that, together with stock held by such person or group, constitutes more than 50 percent of the total fair market value or total voting power of the stock of such Corporation. However, if any one person or more than one person 2 acting as a group, is considered to own more than 50 percent of the total fair market value or total voting power of the stock of the Corporation, the acquisition of additional stock by the same person or persons is not considered to cause a change in the ownership of the corporation (or to cause a change in the effective control of the corporation (as described in paragraph (B)). An increase in the percentage of stock owned by any one person, or persons acting as a group, as a result of a transaction in which the Corporation acquires its stock in exchange for property will be treated as an acquisition of stock for purposes of this section. This paragraph (A) applies only when there is a transfer of stock of the Corporation (or issuance of stock of the Corporation) and stock in such Corporation remains outstanding after the transaction. (B) Change in the effective control of the Corporation. Notwithstanding that the Corporation has not undergone a change in ownership under paragraph (A), a change in the effective control of a corporation occurs on the date that either (1) Any one person, or more than one person acting as a group (as determined under paragraph (E)), acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by such person or persons) ownership of stock of the Corporation possessing 30 percent or more of the total voting power of the stock of such corporation; or (2) a majority of members of the Corporation's board of directors is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of the Corporation's board of directors prior to the date of the appointment or election, provided that for purposes of this paragraph (2) the term Corporation refers solely to the relevant corporation identified in paragraph (i) for which no other corporation is a majority shareholder for purposes of that paragraph. (3) Multiple Changes in Control Events. A change in effective control also may occur in any transaction in which either of the two corporations involved in the transaction has a Change in Control under paragraph (A) or (C). In the absence of an event described in paragraph (1), (2), or (3) a change in the effective control of a Corporation will not have occurred. Further, if any one person, or more than one person acting as a group, is considered to effectively control a Corporation, the acquisition of additional control of the Corporation by the same person or persons is not considered to cause a change in the effective control of the Corporation (or to cause a change in the ownership of the corporation within the meaning of paragraph (b). (C) Change in the ownership of a substantial portion of a Corporation's assets. A change in the ownership of a substantial portion of a Corporation's assets occurs on the date that any one person, or more than one person acting as a group (as determined in paragraph (E)), acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by such person or persons) assets from the Corporation that have a total gross fair market value equal to or more than 40 percent of the total gross fair market value of all of the assets of the Corporation immediately prior to such acquisition or 3 acquisitions. For this purpose, gross fair market value means the value of the assets of the Corporation, or the value of the assets being disposed of, determined without regard to any liabilities associated with such assets. (D) Transfers to a related person. Notwithstanding the foregoing, there is no Change in Control under paragraph (C) when there is a transfer to an entity that is controlled by the shareholders of the transferring corporation immediately after the transfer, as provided in this paragraph (D). A transfer of assets by a corporation is not treated as a change in the ownership of such assets if the assets are transferred to (1) A shareholder of the Corporation (immediately before the asset transfer) in exchange for or with respect to its stock; (2) An entity, 50 percent or more of the total value or voting power of which is owned, directly or indirectly, by the Corporation; (3) A person, or more than one person acting as a group, that owns, directly or indirectly, 50 percent or more of the total value or voting power of all the outstanding stock of the Corporation; or (4) An entity, at least 50 percent of the total value or voting power of which is owned, directly or indirectly, by a person described in paragraph (3). For purposes of this paragraph (D) and except as otherwise provided, a person's status is determined immediately after the transfer of the assets. For example, a transfer to a corporation in which the transferor corporation has no ownership interest before the transaction, but which is a majority-owned subsidiary of the transferor corporation after the transaction is not treated as a change in the ownership of the assets of the transferor corporation. (e) Persons acting as a group. For purposes of paragraphs (A), (B) and (C), persons will not be considered to be acting as a group solely because they purchase or own stock or purchase assets of the same corporation at the same time, or as a result of the same public offering. However, persons will be considered to be acting as a group if they are owners of a corporation that enters into a merger, consolidation, purchase or acquisition of stock, or similar business transaction with the corporation. If a person, including an entity, owns stock in both corporations that enter into a merger, consolidation, purchase or acquisition of stock, or similar transaction, such shareholder is considered to be acting as a group with other shareholders in a corporation only with respect to and to the extent of the ownership in that corporation prior to the transaction giving rise to the change and not with respect to the ownership interest in the other corporation. (f) Stock ownership. Code Section 318(a) shall apply for purposes of determining stock ownership under this Section. 4 Furthermore, notwithstanding the foregoing, no payment shall be made to Consultant on account of severance under this Agreement prior to the first day of the seventh month following separation from severance. Payments delayed as a result of this provision shall be made in a lump sum in the first payment of severance that coincides with or next follows the first day of the seventh month following the Consultant's separation from service" 6. Notices to TLX shall be addressed to the office of Trans-Lux Corporation, attention of the Chairman or Chief Financial Officer, 26 Pearl Street, Norwalk 06850, 7. This Amendment shall be construed in accordance with the laws of the State of New York. All other terms and conditions of the Agreement remain in full force and effect. Please acknowledge below your acceptance of this letter. TRANS-LUX CORPORATION By: /s/ Andela D. Toppi -------------------------- Angela D. Toppi, Executive Vice President Accepted and Agreed: MOVING IMAGES, LLC By: /s/ David Brandt ---------------------- David Brandt, Manager Approved: /s/ Richard Brandt - ------------------------- Richard Brandt 5 -----END PRIVACY-ENHANCED MESSAGE-----