Energy Focus, Inc. Closes Follow-On Public Offering of Common Shares

Energy Focus, Inc.

, a leader in LED lighting technologies, today announced that on September 16, 2015 it closed its follow-on offering of 3 million shares of its common stock at a price to the public of $17.00 per share. 1.5 million shares were sold by the Company and 1.5 million shares were sold by various investors who provided the necessary financing to see the company through its 2012-2013 restructuring, and remain significant stockholders in the company. Total net proceeds to Energy Focus, Inc. from the offering after deducting underwriting discounts and commissions and estimated offering expenses, were approximately $23.7 million. The Company and the selling stockholders granted the underwriters a 30-day option to purchase up to an additional 450,000 shares of common stock on a pro rata basis. "This public offering represents another key corporate milestone for Energy Focus," stated James Tu, Executive Chairman and Chief Executive Officer. "The closing of this transaction provides us with numerous benefits, first and foremost a substantially strengthened balance sheet, including cash of $34 million on a pro forma basis and virtually no long-term debt. A stronger balance sheet enhances our ability to compete for business by mitigating potential concerns about our financial stability or our ability to provide the long-term product warranties and services that customers demand. The additional capital allows us to hire additional personnel as we build our direct sales force while enabling us to take on new initiatives and projects, such as expanding our "Made in America" product lines that we believe will add to our leadership in the military and government sectors, and to provide financing alternatives that could expedite the decision making process by key accounts that we desire to penetrate. Last but not least, the transaction improves our capital structure and liquidity, as we expanded the public float of our shares by approximately 30 percent, with a diverse group of new institutional investors participating in the transaction, now shareholders in our company." "The dramatic transformation of Energy Focus which began in mid-2013, up through this equity raise, has our company now positioned to address the most impactful needs for LED lighting adoption to replace fluorescent and high-intensity discharge lighting. Together, according to the Department of Energy's recent estimate, these retrofit opportunities account for over 60% of energy savings potential through the upgrade of traditional lighting to LEDs. We are as excited as ever about our future as we continue to aggressively develop the pipeline of long-term opportunities with our customers in the specific vertical markets we are targeting – primarily the U.S. and allied foreign navies, military bases, healthcare institutions, K-12 schools, industrial and manufacturing facilities, and national retail chains," concluded Mr. Tu. The offering of these securities was made only by means of a prospectus and pursuant to two effective shelf Registration Statements on Form S-3 that have been filed with the Securities and Exchange Commission (the "SEC"). A final prospectus supplement and accompanying base prospectuses related to the offering have been filed with the SEC and are available on the SEC's website at www.sec.gov. Copies of the preliminary prospectus supplement and the accompanying prospectuses relating to the offering may also be obtained from Oppenheimer & Co. Inc., Attention: Syndicate Prospectus Department, 85 Broad Street, 26th Floor, New York, NY 10004, Phone: (212) 667-8563, Email: EquityProspectus@opco.com. This press release is neither an offer to sell nor a solicitation of an offer to buy any of these securities and shall not constitute an offer or a solicitation of any offer to buy, or a sale of, these securities in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful.