Luxell Announces Windup of Limited Partnership and New Working Capital Financing Agreement



    TORONTO, Jan. 10 /CNW/ - Luxell Technologies Inc. (TSX:LUX) (the
"Company" or "Luxell") announced today that it has completed and closed the
previously announced windup of the 2005 transaction whereby the Company's
patented and non-patented intellectual properties ("IP") were transferred to
Lux Operating Limited Partnership (the "Lux Partnership") in exchange for
promissory notes and cash. The structured transaction provided the Company
with approximately $5,000,000 in new working capital.
    The 2005 transaction agreement included an option for Luxell to
re-acquire the transferred IP at the then-prevailing fair market value ("FMV")
after the end of 2007. An agreement to exercise the option, wind up the Lux
Partnership and to return the IP to Luxell was approved by the independent
members of the Board of Directors on July 10, 2007 following an independent
appraisal of the value of the Lux OLP Units. Approval of this transaction was
considered essential for Luxell to be able to raise critically required equity
in July 2007 and allow for further conventional financing as the company
continues to grow its sales.
    The windup was accomplished without any cost to the Company as the Lux
OLP Units were exchanged for the Promissory Notes outstanding. The return of
the IP will result in a significant tax benefit to the corporation in the form
of future Capital Cost Allowance which do not expire.

    New Working Capital Facility

    Additionally, the Corporation today announced that it has reached a
financing agreement with Mercantile Finance Services Ltd., based in Toronto,
to provide working capital financing supported through the Export Development
Corporation. Under this facility, which can be expanded as sales increase,
Luxell will have ready access to working capital for inventory purchases and
accounts receivable financing for orders originating outside of Canada.
    Jean-Louis Larmor, CEO of Luxell, commented "We are pleased to have
completed this wind up as it improves the Company's ability to attract more
conventional forms of both equity and working capital financing by returning
ownership of our IP directly to Luxell and by simplifying our capital
structure."

    About Luxell

    Luxell designs, manufactures and licenses flat panel display technologies
and solutions for defence and avionics industries. More information can be
found at www.luxell.com. (C) Luxell Technologies Inc., Luxell and Black Layer
are trademarks of Luxell Technologies Inc. All other company and/or product
names are trademarks and/or registered trademarks of their respective
manufacturers.

    %SEDAR: 00008266E




For further information:

For further information: Luxell Technologies Inc.: Simon Dann, Director,
Government & Corporate Relations, (905) 363-0325 ext 235, sdann@luxell.com

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LUXELL TECHNOLOGIES INC.

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