TRC raises $15.5 million preferreds; Temecula lines up $105 million; Jamba gets $35 million

New York, June 1 - TRC Cos., Inc. said it completed a $15.5 million placement of convertible preferred stock which it will use to continue its business plan and support its expansion.

Meanwhile Temecula Valley Bancorp Inc. announced a $105 million equity infusion to help resolve its current troubles - but with the financing coming from a private equity fund and institutional investors rather than in the form of a government bailout.

Another substantial PIPE deal on a day notable for the number of large transactions was announced by Jamba, Inc., which will sell $35 million of convertible preferred stock to two investors to continue its growth.

TRC places convertibles

TRC said it raised $15.5 million in a private placement of series A convertible preferred stock.

The company sold 7,209.302 preferreds at $2,150 apiece. Each preferred share will automatically convert into 1,000 common shares after 18 months.

Proceeds will be used for general purposes, to reduce debt under the company's revolving credit agreement and to increase its tangible net worth.

TRC is a national consulting, engineering and construction management firm based in Windsor, Conn.

The conversion price of $2.15 compares with a stock price (NYSE: TRR) of $4.05 at Monday's close - up $0.06 on the day. The company has a market capitalization of $78.34 million.

"This private equity placement demonstrates the level of confidence that the investors have in TRC, especially in light of current market conditions," said Chris Vincze TRC's chairman and chief executive officer, in a news release.

"During the past three years, TRC has transformed itself into a more efficient company with a leaner cost structure. This financing should accelerate TRC's ability to successfully implement its new business plan and expand its market presence."

TRC added that the additional cash and equity on its balance sheet will support its ability to obtain the bonding capacity required to win fixed-price contracts in its energy business and other areas.

"The proceeds from the private placement, along with the flexibility provided from our amended revolving credit agreement, strengthen our overall financial position and enable improved execution on our organic revenue growth strategy," added Vincze.

TRC will call a meeting of shareholders to approve the issuance of stock on conversion of the preferreds.

Temecula draws on equity fund

In the financial sector, Temecula Valley Bancorp announced a privately funded bailout, saying it has agreed to sell $105 million of equity securities to Bancroft Capital and institutional investors including Orient Property Group LLC.

The investors will also make a $105 million investment in a pool of targeted loans that are non-performing or sub-performing.

On completion of the transaction, the investors will own 95% of Temecula Valley's fully diluted equity and will have the right to designate and elect a majority of the board of directors.

"We are very pleased at the prospect of working with the Bancroft/Orient group as partners in our proposed recapitalization," said Frank Basirico, Temecula Valley's chief executive officer, in a news release.

"There is no question that there has been unprecedented economic difficulty in our industry and markets.

"We believe this transaction, if consummated, would enable our shareholders, customers and employees to benefit in a way not possible in our current form."

The fund raising will be structured to "meet or exceed" Temecula Valley's capital requirements, the bank said.

In the equity portion, the investors will receive voting securities for a total of $105 million that will receive Tier 1 capital treatment.

If preferred stock is issued, it will be convertible at $0.50 per share, a 25% premium over the $0.40 closing price of Temecula Valley's stock on May 29. (Nasdaq: TMCV)

Before conversion, the preferreds will vote on an as-converted basis.

"This transaction represents a unique opportunity to aid a very capable management team in the restoration of its community banking model," commented Douglas McDonald, founder and president of Bancroft Capital, in a news release.

"Temecula Valley Bank has traditionally been one of the finest small banks in the country and our investment will enable the bank to expand while at the same time addressing the issues in its loan portfolio that have caused the bank distress."

Bancroft Capital is a boutique real estate and bank consulting company. Orient Property Group is a Los Angeles-based investment firm backed by hedge fund D.E. Shaw.

Temecula Valley is a Temecula, Calif., bank holding company.

Jamba drinks up $35 million

Meanwhile Jamba is looking to expansion with its new $35 million financing structured as a private placement of convertible preferred stock.

Proceeds from the fund raising will be used to continue the company's efforts to franchise and license its brand.

Of the total, Mistral Equity Partners will invest $19.55 million and the remaining $15.45 million investment will be made by a company controlled by the Serruya family.

The 8% preferreds mature in June 2016. They are convertible into common shares at $1.15 per share.

Jamba's stock (Nasdaq: JMBA) closed at $1.09 on Monday, up $0.09 on the day. Its market capitalization is $59.61 million.

Proceeds will be used to repay a senior term note and to provide additional working capital.

Jamba said the funds will be used as it executes its Blend plan, short for "Building a Customer First Service Culture, Building a Food Capability, Licensing and Consumer Products Platform, Improvement in our Expense Structure and Accelerating Franchising and Non-Traditional Store Development."

"We have made significant progress in delivering on several of the plan's key elements, including new licensing alliances, ongoing collaboration with Nestlé, an expanded refranchising initiative, and an improved cost structure and disciplined expense management. This financing will play a key role in helping us to achieve our long term strategic objectives," said James D. White, president and chief executive officer of Jamba, in a news release.

"We are very excited about Jamba and the potential growth opportunities available to the Company as it extends the brand through licensing and franchising opportunities. We believe that Jamba's management team can develop the brand into a significant lifestyle brand within a number of consumer categories," commented Andrew Heyer, managing partner of Mistral Equity Partners.

Based in Emeryville, Calif., Jamba serves as a holding company for its subsidiary, Jamba Juice Co.

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