Landlord at 4 Times Square to buy Lumacom sign 09:20, Friday, 24 March 2006
Sydney - Friday - March 24: (RWE Aust Business News) - Lumacom Ltd (ASX:LUM) has come to an agreement with 4 Times Square Associates, the owner of 4 Times Square, for the purchase of the company's New York sign and surrender of the licence on the location.
The entire transaction surrounding the sale of the sign involves the payment of cash of $489,505, cancellation of rental/licence debt of $210,194 which is due and cancellation of the licence and commitments for the balance of the term of the licence worth $3.05m.
In addition Lumacom will immediately have its security deposit of $218,925 returned to it.
The New York sign has proven the operational robustness of the technology and has been the subject of research and development within the organisation over the last three years.
The new board found it unacceptable that the sign had been unable to attract an advertiser since its completion in April 2005 whilst continuing to incur significant holding costs.
Having reviewed the position, it believed the most likely group to attract an advertiser would be a New York based organisation.
It concluded that the landlord was the best to effectively commercialise the asset.
Lumacom will continue to work closely with the new owner and will make available parts, stock and expertise over the next four years to ensure the optimal operation of the sign.
In addition, the agreement also provides the landlord with an option to purchase up to three further signs, to be installed on the other three sides of the building rooftop, on commercially agreed terms.
The deal with the new owner also allows the company to continue to have rooftop viewings to prospective purchasers of the company's signs and the sign will continue to be shown as Lumacom technology.
Lumacom still intends to promote its LumaPanel technology on the back of this sale in New York, working with various outdoor groups in the USA.
Its shares last traded at 3.7c.
ENDS
LUM Price at posting:
0.0¢ Sentiment: Buy Disclosure: Not Held