KBS Fashion Group Limited, through its subsidiaries, is engaged in the business of designing, manufacturing, selling
SHISHI, China, Feb. 26, 2020 KBS Fashion Group Limited (“KBS” or the “Company”) (NASDAQ: KBSF), a leading fully-integrated casual menswear company in China, announced today that its Board of Directors approved a Binding Memorandum of Understanding (the “MOU”) regarding an exempt private offering of convertible preferred stock in the amount of up to $1,500,000 to a single investor. Under the MOU, the investor will purchase up to 100,000 shares of convertible preferred stock at a price of $15 per share. Each share of preferred stock will be convertible to shares of our common stock at a ratio of 15 shares of common stock for each share of preferred stock. All shares of common stock issuable upon conversion of the preferred stock will be subject to a two-year lock-up agreement running from the initial closing of the financing. Conversions will be limited such that the investor may not effect a conversion of the preferred stock to the extent that, immediately after such conversion, the investor would be the beneficial owner of more than 9.99% of our issued and outstanding common stock.
Formal documentation of the proposed private offering is pending and the offering is expected to close in the near future.
The proceeds are intended to be used by Flower Crown Holding (“FCH”), a fully owned subsidiary of KBSF, for its continuing business expansion. FCH is the owner of Luxventure, a social media platform launched in July of 2020 offering cross border merchandise through online and off-line channels and luxury tourism experiences to its members. Luxventure has entered into cooperation agreements with over 15 major corporations such as CITIC International Travel (Guangdong) Co., Ltd, Hangzhou Youzan Technology Co., Ltd. and Beijing Space Transformation Technology Co., Ltd, a subsidiary of Bytedance.
As one of the very few companies in China with the licenses to source, distribute and sale of cross border luxury merchandise, Luxventure offers its members a significant discount to its competitors’ price. In January of 2021, Luxventure formed a strategic partnership with a subsidiary of Hainan Strait Shipping Co., Ltd (“HSS”), which operates 45 cruise vessels in Hainan Island, for self-owned stores. For the year 2021, those cruise vessels are expected to have over 20,000,000 visitors. In January of 2021, Luxventure recruited Mr. Liu Ze, an expert in Artificial Intelligence and Blockchain, for its e-commerce portal.
Ms. Sun Lei, Chief Executive Officer of the Company commented: “We are proud of what Luxventure had accomplished in a short time. International travel restriction has increased demand for domestic travel and crossed border mechandise. Chinese consumers have flocked to Hainan Island to take advantage of its COVID-19 free environment and duty-free shopping. Sales of crossed border merchandise in China is one of the very few areas which had minimal impact by COVID-19. Given China’s designation of Hainan Island as a free port and Luxventure’s strong competitive advantage, this investment would allow it to further expand into this business.”
This press release shall not constitute an offer to sell, or the solicitation of an offer to buy, nor may there be any sale of these securities in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.
About KBS Fashion Group Limited
Headquartered in Shishi, China, KBS Fashion Group Limited, through its subsidiaries, is engaged in the business of designing, manufacturing, selling and distributing its own casual menswear brand, KBS, through a network of 30 KBS branded stores (as of Dec 31, 2019) and over a number of multi-brand stores. To learn more about the Company, please visit its corporate website at www.kbsfashion.com.
Safe Harbor Statement
This press release may contain certain “forward-looking statements” relating to the business of KBS Fashion Group Limited, and its subsidiary companies. All statements, other than statements of historical fact included herein, are “forward-looking statements” in nature within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements, often identified by the use of forward-looking terminology such as “believes,” “expects” or similar expressions, involve known and unknown risks and uncertainties. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, they do involve assumptions, risks and uncertainties, and these expectations may prove to be incorrect. Investors should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. The Company’s actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including those discussed in the Company’s periodic reports that are filed with the Securities and Exchange Commission and available on its website (http://www.sec.gov). All forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these factors. Other than as required under the securities laws, the Company does not assume a duty to update these forward-looking statements.
By PR Newswire