MONTREAL, March 4, 2019 /CNW/ - LXRandCo, Inc. ("LXRandCo" or the "Company") (TSX: LXR, LXR.WT), an international omni-channel retailer of branded vintage luxury handbags and accessories, is pleased to announce it has completed its previously announced non-brokered private placement (the "Private Placement") to Gibraltar & Company, Inc., Gibraltar Brands, Inc. and Gibraltar Ventures Fund One Limited Partnership (collectively, "Gibraltar"), which are insiders or affiliates of insiders of the Company, and Star Orange Enterprise Pte. Ltd. (an affiliate of the Rattha Group)("Rattha"), of an aggregate of 12,500,000 Class B Shares (the "Shares") in the capital of the Company at a price of $0.40 per Share for gross proceeds of CAD$5,000,000. The completion of the Private Placement concludes the mandate of the Company's special committee of independent directors (the "Special Committee") which was formed in August 2018 to identify and evaluate a broad range of strategic and financing alternatives for the Company and unanimously recommended the Private Placement.
The net proceeds of the Private Placement shall be used to fund the execution of LXRandCo's revised strategic plan. The Company's plan through 2020 is focused on disciplined revenue growth, margin expansion and sustainable cash flow generation, and includes prudent expansion of the Company's retail network (store count) in the U.S. and Canada, as well as initiatives intended to expand the underpenetrated e-commerce and wholesale channels. The plan also includes initiatives focused on gross margin expansion, cost management, and working capital management. The proceeds shall also be used for general working capital purposes.
"Completion of this financing enables us to build on the steady, encouraging progress we have made on the revised strategic plan since its implementation in June of last year," said Steven Goldsmith, President and Chief Executive Officer. "As a true omni-channel vintage luxury retailer, LXRandCo remains uniquely positioned for long-term success in this rapidly growing market. Now, with the financial stability and capital resources to fund our growth initiatives in each of the three components of our business – retail stores, e-commerce and wholesale – combined with our continued focus on margin expansion and cost management, I am more confident than ever in our ability to execute our plan and achieve our overriding objective of sustainable cash flow generation to deliver value to shareholders."
"The closing of this financing represents the culmination of a rigorous process intended to maximize value for LXRandCo's shareholders," said Stephane Guerin, independent member of the LXRandCo board of directors and chair of the Special Committee. "The senior management team's progress to date on the revised strategic plan, including the rightsizing of the retail store network and overall cost structure, has positioned the Company for success as it pursues prudent growth funded by this private placement. On behalf of the board of directors, I would like to thank them for their tireless effort in this regard."
As a result of the Private Placement, Gibraltar and affiliates beneficially own, or control or direct, directly or indirectly 9,716,500 Shares, representing 34.5% of the issued and outstanding Shares of the Company. In addition, Rattha became an insider of the Company and now holds 6,250,000 Shares representing approximately 22.2% of the Shares. The Shares will be subject to a statutory hold period of four months plus a day from the date of issuance in accordance with applicable securities legislation.
LXRandCo is an international omni-channel retailer of branded vintage luxury handbags and other personal luxury products. LXRandCo sources and authenticates high-quality, pre-owned products from iconic brands such as Hermès, Louis Vuitton, Gucci and Chanel, among others, and sells them at attractive prices through: a retail network of stores located primarily in major department stores in the United States and Canada; wholesale operations primarily in the United States; and its own e-commerce website, www.lxrco.com.
Caution Regarding Forward-Looking Statements
Certain statements in this press release are prospective in nature and constitute forward-looking information and/or forward-looking statements within the meaning of applicable securities laws (collectively, "forward-looking statements"). Forward-looking statements generally, but not always, can be identified by the use of forward-looking terminology such as "outlook", "objective", "may", "could", "would", "will", "expect", "intend", "estimate", "forecasts", "project", "seek", "anticipate", "believes", "should", "plans" or "continue", or similar expressions suggesting future outcomes or events and the negative of any of these terms. Forward-looking statements in this news release include, but are not limited to, statements regarding the Company's intended use of proceeds from the Private Placement, the expected benefits of the Private Placement on the Company's financial situation and the successful achievement of the Company's strategic plan or components thereof. Forward-looking statements reflect management's current beliefs, expectations and assumptions and are based on information currently available to management, which includes assumptions about management's historical experience, perception of trends and current business conditions, expected future developments and other factors which management considers appropriate. With respect to the forward-looking statements included in this press release, management has made certain assumptions with respect to, among other things, the Company's ability to meet its future objectives and strategies, the Company's ability to achieve its future projects and plans and that such projects and plans will proceed as anticipated, as well as assumptions concerning general economic and market growth rates, currency exchange and interest rates and competitive intensity.
Readers are cautioned not to place undue reliance on forward-looking statements, as there can be no assurance that the future circumstances, outcomes or results anticipated or implied by such forward-looking statements will occur or that plans, intentions or expectations upon which the forward-looking statements are based will occur.
All forward-looking statements included in and incorporated into this press release are qualified by these cautionary statements. Unless otherwise indicated, the forward-looking statements contained herein are made as of the date of this press release, and except as required by applicable law, the Company does not undertake any obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.
Readers are cautioned that the actual results achieved may vary from the information provided herein and that such variations may be material. Consequently, there are no representations by LXRandCo that actual results achieved will be the same in whole or in part as those set out in the forward-looking statements.
SOURCE LXRandCo, Inc.
For further information: Nadine Eap, Interim Chief Financial Officer, LXRandCo, Inc., +1 (514) 564-9993 ext :037, firstname.lastname@example.org; Lawrence Chamberlain, Investor Relations, LodeRock Advisors, +1 (416) 519-4196, email@example.com