/NOT FOR DISTRIBUTION TO U.S. NEWSWIRE
SERVICES OR FOR DISSEMINATION IN THE UNITED STATES/
MONTREAL, Dec. 7, 2020 /CNW/ - LXRandCo, Inc.
("LXR" or the "Company") (TSX: LXR) (TSX: LXR.WT), an
omni-channel retailer of branded vintage luxury handbags and
accessories, is pleased to announce a brokered private placement
led by Cormark Securities Inc. ("Cormark"), acting as agent
(the "Private Placement"), of a minimum of $5.0 million or 40,000,000 units, with each
unit consisting of one
Class B Share (the "Share(s)") and a
one-quarter of one Class B Share purchase warrant (the
"Warrant") (the "Units"), in the capital of the
Company at a price of $0.125 per
Unit. Each whole Warrant will entitle the holder to purchase one
additional Share at a price of $0.175
for a period of 24 months following the closing of the Private
Placement. The Warrants are subject to an accelerated expiry if,
following the date that is four months and one day after the date
of issuance of the Units and prior to the expiry date of the
Warrants, the daily volume weighted average trading price of the
Shares exceeds $0.35 for ten
consecutive trading days. The Company has also granted Cormark an
option to arrange the purchase of up to an additional 20 million
Units under this offering at the issue price.
The net proceeds of the Private Placement shall be used to fund
the execution of LXR's transformation to a digital-first
omni-channel model as announced on September
3, 2020, whereby its strategic priorities include:
accelerating the growth of the Company's digital presence through
its LXRCO.com site, leveraging growth through third-party
e-commerce platforms, and enabling the expansion of e-commerce
opportunities of its retail channel partners. The proceeds of the
offering shall be used by the Company to accelerate the growth of
its e-commerce initiatives, which include expansion of the
e-commerce team and increased digital marketing spend, and for
general working capital purposes.
In 2019, LXR's e-commerce revenue was $3.7 million (2018—$2.4 million). Since the
release of the Company's third quarter results on November 13, 2020, the Company's e-commerce
activities in the fourth quarter have experienced significant
growth. For the two-month period ended November 30, 2020, the Company's total e-commerce
revenues were approximately $0.9
million or 45% higher than for the similar period in 2019.
This included approximately $0.6
million in revenue from the Company's LXRCO.com
site which was 57% higher than that for the similar period in
2019 and approximately $0.3 million
in revenue from other e-commerce partner initiatives. In the
first two months of the fourth quarter, LXRCO.com site revenue
represented 63% of total e-commerce activities. In addition,
e-commerce average order value during the first two months of the
fourth quarter was $1,032 per
transaction, an increase of 30% as compared to the prior
period.
Closing of the Private Placement is subject to receipt of all
necessary corporate and regulatory approvals, including the
approval of the Toronto Stock Exchange and is anticipated to occur
on or about December 22, 2020.
Gibraltar & Company, Inc.
and its affiliates (collectively, "Gibraltar") currently beneficially own, or
control or direct, directly or indirectly approximately 10.8
million Shares, representing 33.1% of the Shares as of the date
hereof. As a part of the Private Placement, Gibraltar has committed $1.0 million and certain insiders of Gibraltar and certain directors of LXR
collectively, have committed an additional $1.4 million. Upon completion of the Private
Placement, Gibraltar would
beneficially own, or control or direct, directly or indirectly 18.8
million Shares (before exercise of the Warrants), representing
25.9% of the issued and outstanding Shares of the Company, or 20.8
million Shares, representing 25.2% of the issued and outstanding
Shares of the Company on a fully-diluted basis.
The securities issued in connection with the Private Placement
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. The Warrants will not be listed on any
exchange.
This press release is not an offer to sell or the solicitation
of an offer to buy the securities in the
United States or in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to qualification or
registration under the securities laws of such jurisdiction. The
securities being offered have not been, nor will they be,
registered under the United States Securities Act of 1933, as
amended, and such securities may not be offered or sold within
the United States or to, or for
the account or benefit of, U.S. persons absent registration or an
applicable exemption from U.S. registration requirements and
applicable U.S. state securities laws.
About LXR
LXR is a socially responsible, digital-first omni-channel
retailer of branded vintage luxury handbags and other personal
accessories. It curates, sources and authenticates high-quality,
pre-owned products from iconic brands such as Hermès, Louis Vuitton, Gucci, Prada and Chanel and sells
them at attractive prices through its e-commerce website,
www.lxrco.com, as well as the online platforms of its partners and
online vintage-focused marketplaces across North America. The Company's omni-channel
model is also supported by retail 'shop-in-shop' experience centers
and by wholesale activities.
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
closing date of 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 the satisfaction of all conditions of
closing to the Private Placement, including receipt of all
necessary regulatory and stock exchange approvals, and the
successful completion of the Private Placement within the
anticipated timeframe, 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.