AeroGrow International, Inc. AERO Makers of th

AeroGrow International, Inc. AERO

Makers of the AeroGarden® line of indoor gardening products, announced the completion on April 11, 2012 of a series of transactions that converted outstanding debt and preferred stock into common stock. The transactions dramatically simplify the Company's capital structure, eliminate sizeable upcoming debt payments, and clear away a number of structural impediments to the Company raising new capital. The conversions were approved by substantial majorities of the security holders and the Company's shareholders.

"The capital restructuring addresses a problem we have been dealing with for some time," said Mike Wolfe, President and CEO of AeroGrow. "While we have made great progress improving our operations and financial results, our complex capital structure and high leverage have created real issues for us with investors, and consequently have made it difficult for us to access the capital markets. The restructuring transactions dramatically reduce our debt, increase our equity base, and eliminate a potential $8 million refinancing risk from our future cash requirements. The net effect is a better cash outlook for the Company and a more transparent balance sheet that is easier for investors to understand and value."

The transactions included the conversion of $7.4 million in convertible debt and accrued interest with a May 2013 maturity into approximately 298 million common shares, and the conversion of $7.5 million in convertible preferred stock into approximately 95 million common shares. The restructuring transactions were overwhelmingly supported by the holders of the convertible securities, as 90% of the preferred shareholders, and 97% of the convertible debt holders voted to approve the transactions. Following these transactions, the Company no longer has any convertible debt or preferred stock outstanding.

"Completing this restructuring is another major step forward in our turnaround efforts," concluded Mr. Wolfe. "With our improved business model and cleaner balance sheet, we believe we are well-positioned to continue our efforts to re-capitalize the Company so we can invest in new, profitable channels of distribution, and deliver value to our shareholders."

About AeroGrow International, Inc.:

Founded in 2002 in Boulder, Colorado, AeroGrow International, Inc. is dedicated to the research, development and marketing of the AeroGarden line of foolproof, dirt-free indoor gardens. AeroGardens allow anyone to grow farmer's market fresh herbs, salad greens, tomatoes, chili peppers, flowers and more, indoors, year-round, so simply and easily that no green thumb is required. See www.aerogrow.com.