TX Rail Products, Inc. Previously Announced Strategic Capital Raise [CORRECTION]

Rhea-AI Summary

TX Rail Products (OTC: TXRP) issued a correction to its Jan 5, 2026 announcement clarifying a private placement. The company agreed to sell 6,000,000 initial shares at $0.30 per share for anticipated gross proceeds of $1.8 million, and granted the investor an option to buy 4,000,000 option shares at $0.50 per share for 36 months.

Closing of the initial share sale must occur within 30 days of the purchase agreement subject to closing conditions, receipt of proceeds, and issuance of shares. If the investor holds at least 1% after issuance, the investor will grant voting control over the initial and option shares to TX Rail via a proxy or voting agreement. The company intends to use proceeds for general working capital and inventory.

Positive

• Anticipated gross proceeds of $1.8 million from initial share sale
• Investor option could add up to $2.0 million (4,000,000×$0.50)
• Proxy agreement provision returns voting control to company if investor holds ≥1%

Negative

• Transaction not certain; closing only upon satisfied conditions
• Issuance of up to 10,000,000 shares may dilute existing shareholders

ASHLAND, Ky., Jan. 16, 2026 (GLOBE NEWSWIRE) -- TX Rail Products, Inc. (“TX Rail”) (OTC Markets PINK: TXRP), a supplier of rail and rail products to the U.S. coal mining industry, short line railroads and tunneling contractors, today announced corrections and revisions to the press issued on January 5, 2026, regarding the terms and conditions of a strategic private placement of its shares of common stock.

TX Rail entered into a securities purchase agreement “purchase agreement” with an accredited investor pursuant to which it agreed to sell to the investor in a private placement an aggregate of 6,000,000 shares of common stock, no par value (“initial shares”), at a purchase price of $0.30 per share, for anticipated gross proceeds to the company of $1.8 million. In addition, TX Rail granted the investor an option to purchase an additional 4,000,000 shares of common stock at a price of $0.50 per share for a period of 36 months following the date of the agreement (“option shares”). The purchase price for the initial shares and the option shares represented a premium to the company’s market price at the time of the original announcement of the private placement.

Under the terms of the purchase agreement, closing of the sale of the initial shares is to take place on a mutually agreed upon date upon the satisfaction of all closing conditions but no later than 30 days after the date of the purchase agreement. Conditions to closing include TX Rail’s receipt from the investor of proceeds from the sale of the shares and the issuance to the investor of the initial shares.

In addition, under the terms of the purchase agreement, provided the investor holds at least 1% of the company’s issued and outstanding shares, the investor has agreed to grant voting control with respect to the initial and option shares to TX Rail and enter into a proxy or voting agreement with respect thereto.

TX Rail Products continues to work constructively with the investor to complete the transaction, although there can be no assurance the transaction will close.

The company intends to use the proceeds from the offering primarily for general working capital purposes, including the purchase of inventory to support visible customer demand.

Mr. Shrewsbury, CEO and Chairman of TX Rail Products, Inc., commented, “We remain encouraged by the interest demonstrated through this transaction and continue to focus on executing our operational plans. We appreciate our shareholders’ continued support and will communicate promptly once the financing is complete.”

Forward-Looking and Cautionary Statements

Except for the historical information and discussions contained herein, statements contained in this release may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 (PSLRA) and other applicable law. When used, the words "believe", "anticipate", "estimate", "project", "should", "expect", "plan", "assume" and similar expressions that do not relate solely to historical matters identify forward-looking statements. Forward-looking statements are based on the Company's current assumptions regarding future business and financial performance. Forward-looking statements concerning future plans or results are necessarily only estimates and actual results could differ materially from expectations. These statements involve a number of risks, uncertainties and other factors that could cause actual results to differ materially, including the following: our ability to implement our business strategy; our financial strategy; a downturn in economic environment; our failure to meet growth and productivity objectives; a failure of our innovation initiatives; risks from investing in growth opportunities; fluctuations in financial results and purchases; the impact of local legal, economic, political and health conditions; adverse effects from environmental matters and tax matters; ineffective internal controls; our use of accounting estimates; our ability to attract and retain key personnel and our reliance on critical skills; impact of relationships with critical suppliers; currency fluctuations and customer financing risks; the impact of changes in market liquidity conditions and customer credit risk on receivables; our reliance on third party distribution channels; Securities and Exchange Commission regulations related to trading in "penny stocks;" the continued availability of certain financing provided by our CEO; and other risks, uncertainties and factors or in materials incorporated therein by reference. Any forward-looking statement in this release speaks only as of the date on which it is made. We assume no obligation to update or revise any forward-looking statement. Notwithstanding the above, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1933, as amended, expressly state that the safe harbor for forward looking statements does not apply to companies that issue penny stocks. Because we may from time to time be considered to be an issuer of penny stock, the safe harbor for forward looking statements under the PSLRA may not be applied to us at certain times.

Contacts

Investor Relations:
Brett Maas
Hayden IR
txrp@haydenir.com
646-536-7331

William “Buck” Shrewsbury        
Chairman and CEO TX Rail Products, Inc.
(606) 928-3131       

FAQ

What exactly did TX Rail (TXRP) agree to sell in the private placement on Jan 5, 2026?

TX Rail agreed to sell 6,000,000 initial shares at $0.30 per share for anticipated gross proceeds of $1.8M.

Does the TX Rail private placement include an option for more shares and what are the terms?

Yes; the investor has an option to purchase 4,000,000 additional shares at $0.50 per share for 36 months following the agreement.

When must the TX Rail (TXRP) private placement closing occur?

Closing of the initial share sale must occur on a mutually agreed date but no later than 30 days after the purchase agreement date.

How will TX Rail use the proceeds from the TXRP private placement?

The company intends to use proceeds primarily for general working capital, including purchasing inventory to support visible customer demand.

Will the investor have voting control after the TXRP transaction closes?

If the investor holds at least 1% of issued shares, the investor agreed to grant voting control over the initial and option shares to TX Rail via a proxy or voting agreement.