Le Château converts $5 million of $10 million loan into shares
MONTREAL, Sept. 20, 2012 /CNW Telbec/ - Le Château Inc. (TSX: CTU.A) has converted approximately $5 million of the $10 million loan from a Corporation controlled by Herschel Segal, the founder of Le Château and a Director and majority shareholder of the Company, into 2,454,097 Class A shares of Le Château.
The Class A Shares are being issued at $2.042 and the issuance is exempt from the requirements to obtain an independent valuation or minority approval under the related party transaction rules of applicable securities legislation.
After giving effect to the issuance of the shares, Mr. Segal owns, directly or indirectly, 2,456,377 Class A shares (being approximately 10.83% of the outstanding Class A shares) and 4,400,000 Class B shares (being approximately 96.5% of the outstanding Class B shares), representing approximately 68.04% of the votes attached to all outstanding shares of Le Château. The Class A shares are being acquired in connection with the partial conversion of the loan and for investment purposes. Mr. Segal may acquire or otherwise trade in shares of Le Château from time to time.
Le Château is a leading Canadian brand in specialty retailing, offering a broad array of contemporary fashion apparel, accessories and footwear for style-conscious women and men. The Le Château brand is synonymous with ageless fashion at accessible prices and is sold exclusively through the Company's 236 retail locations, of which 235 are located in Canada. The Company's outlets are primarily found in major urban shopping malls, as well as street-front locations with high pedestrian traffic. In addition, the Company has 10 stores under license in the Middle East. Le Château's web-based marketing is further broadening the Company's customer base among Internet shoppers in both Canada and the United States. With its 52-year tradition of vertical integration, emphasizing a design and manufacturing approach to retailing, Le Château is unique among Canadian fashion merchants.
This news release may contain forward-looking statements relating to the Company and/or the environment in which it operates that are based on the Company's expectations, estimates and forecasts. These statements are not guarantees of future performance and involve risks and uncertainties that are difficult to predict and/or are beyond the Company's control. A number of factors may cause actual outcomes and results to differ materially from those expressed. These factors include those set forth in other public filings of the Company. Therefore, readers should not place undue reliance on these forward-looking statements. In addition, these forward-looking statements speak only as of the date made and the Company disavows any intention or obligation to update or revise any such statements as a result of any event, circumstance or otherwise except to the extent required under applicable securities law.
Factors which could cause actual results or events to differ materially from current expectations include, among other things: the ability of the Company to successfully implement its business initiatives and whether such business initiatives will yield the expected benefits; competitive conditions in the businesses in which the Company participates; changes in consumer spending; general economic conditions and normal business uncertainty; customer preferences towards product offerings; seasonal weather patterns; fluctuations in foreign currency exchange rates; changes in the Company's relationship with its suppliers; interest rate fluctuations and other changes in borrowing costs; and changes in laws, rules and regulations applicable to the Company.
SOURCE: LE CHATEAU INC.For further information:
Emilia Di Raddo, CPA, CA, President (514) 738-7000
Johnny Del Ciancio, CPA, CA, Vice-President, Finance, (514) 738-7000
MaisonBrison: Pierre Boucher, (514) 731-0000