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MONTREAL, March 1,
2023 /CNW/ - LXRandCo, Inc. ("LXR" or
the "Company") (TSX: LXR) (TSX: LXR.WT), a digital-first
omni-channel retailer of authenticated pre-owned luxury handbags
and accessories, is pleased to announce a brokered private
placement (the "Private Placement") led by Stifel Nicolaus
Canada Inc. ("Stifel GMP"), acting as lead agent, together
with a syndicate of agents, of up to 2,376 unsecured convertible
debenture units of the Company (the "Debenture Units"), for
gross proceeds of up to $2,376,000. The net proceeds of the
offering will be used for working capital and for general corporate
purposes.
Each Debenture Unit is comprised of (i) one $1,000 principal amount unsecured convertible
debenture (a "Convertible Debenture") and (ii) 700 Class B
share purchase warrants of the Company (each, a "Warrant").
The Convertible Debentures shall bear interest at a rate of 10.0%
per annum from the closing date of the offering (the "Closing
Date"), and shall mature on the date that is 36 months from the
Closing Date (the "Maturity Date").
The outstanding principal amount of each Convertible Debenture
shall be convertible at the option of the holder thereof into Class
B shares of the Company (the "Class B Shares"), at a
conversion price of $0.12 per Class B
Share (the "Conversion Price"), at any time prior to close
of business on the last business day immediately preceding the
Maturity Date. If, at any time following the date that is eighteen
(18) months from the Closing Date, the daily volume weighted
average trading price of the Class B Shares on the Toronto Stock
Exchange ("TSX") is greater than $0.16 per Class B Share for the preceding 10
consecutive trading days, the Company shall have the option to
convert all of the principal amount of the then outstanding
Convertible Debentures at the Conversion Price with at least 30
days' prior written notice.
Each whole Warrant shall be exercisable to acquire one Class B
Share at an exercise price of $0.16
per Class B Share (the "Exercise Price") for a period of 24
months from the Closing Date. If, at any time following the date
that is four months from the Closing Date and prior to the expiry
date of the Warrants, the daily volume weighted average trading
price of the Class B Shares on the TSX is greater than $0.20 per Class B Share for the preceding 10
consecutive trading days, the Company shall have the option to
accelerate the expiry date of the Warrants with at least 30 days'
prior written notice.
The Company will pay the agents a cash commission equal to 7% of
the gross proceeds of the Private Placement, which cash commission
is reduced to 3.5% for gross proceeds from Debenture Units sold to
purchasers under a president's list, which list is to be pre-agreed
to between the Corporation and the agents (the "President's
List"). Additionally, the Company will issue such number of
Class B share purchase warrants to the agents (the "Agent
Warrants") as equal to 7% of the gross proceeds of the Private
Placement divided by the Conversion Price, which number is reduced
to 3.5% for gross proceeds from Debenture Units sold to purchasers
under a President's List. Each whole Agent Warrant shall be
exercisable to acquire one Class B Share at an exercise price of
$0.12 per Class B Share for a period
of 24 months from the Closing Date.
The maximum number of Class B Shares issuable upon conversion of
the Convertible Debentures and exercise of the Warrants and Agent
Warrants will not, in the aggregate, exceed 25% of the issued and
outstanding Class B Shares before giving effect to the Private
Placement. Insiders are expected to participate in the Private
Placement under the President's List to acquire up to an aggregate
of 950 Debenture Units. The maximum number of Class B Shares
issuable upon conversion of the Convertible Debentures and exercise
of the Warrants issued to such insiders shall not exceed 10% of the
issued and outstanding Class B Shares before giving effect to the
Private Placement.
Closing of the Private Placement is subject to receipt of all
necessary regulatory
approvals, including the approval of the Toronto Stock Exchange, and is
anticipated to occur on or about March 30,
2023.
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 Convertible
Debentures, the Warrants and the Agent Warrants will not be listed
on any exchange.
Update on Strategic Review
Process
On October 20, 2022, LXR announced
it was undertaking a strategic review process to assess the best
course of action for the Company's next phase of development and
growth. The Company retained Stifel GMP as its exclusive financial
advisor to help assess and more fully explore the strategic
alternatives available to it, which included the possibility
of raising of growth capital, a sale or merger of the Company or an
acquisition by the Company. Following the review
process, the Company has determined its best path forward is
to continue executing on its strategic plan and further optimize
its operations by raising growth capital.
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
LXRandCo is a socially responsible, digital-first omni-channel
retailer of authenticated pre-owned luxury handbags and personal
accessories. Since 2010, we have been providing consumers with
authenticated branded luxury products by promoting their reuse and
providing an environmentally responsible way for consumers to
purchase luxury products. We achieve this through our digital-first
strategy by selling directly to consumers through our website
at www.lxrco.com and indirectly, by powering the
e-commerce and other platforms of key channel partners. Our
omni-channel model is also supported by retail 'shop-in-shop'
experience centers and by wholesale activities with select retail
partners across North America.
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 anticipated proceeds from
the Private Placement, the Company's intended use of proceeds from
the Private Placement, the participation of insiders in the Private
Placement, and the expected closing date of the Private Placement.
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.