LuxUrban Hotels Announces Non-Dilutive Financing Of Up To $10M To Accelerate Growth
Portfolio Pulse from Benzinga Newsdesk
LuxUrban Hotels Inc. (LUXH) has secured a non-dilutive financing agreement for up to $10 million from its Chairman and Co-CEO, Brian Ferdinand. The financing is structured as a 36-month unsecured advancing term promissory note with a 1% annual interest rate, prepayable at the company's discretion. The funds, raised through the sale of Ferdinand's shares, will be used for growth capital to lease hotels in the U.S. and internationally. The company's growth strategy is supported by proceeds from a recent preferred stock offering and partnership with Wyndham Hotels & Resorts. The financing is not required to meet the company's 2023 and 2024 guidance for net rental revenue, EBITDA, and hotel rooms under long-term Master Lease Agreements.
November 17, 2023 | 1:09 pm
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LuxUrban Hotels Inc. has announced a non-dilutive financing deal for up to $10 million to support its growth strategy. The financing, provided by the company's Chairman, is expected to help LuxUrban lease more hotels and expand both domestically and internationally.
The non-dilutive nature of the financing suggests a positive impact on LUXH's stock price in the short term, as it avoids shareholder dilution and shows a strong commitment from the company's leadership. The use of the funds for growth capital indicates an aggressive expansion strategy, which could be viewed favorably by investors. However, the impact is not rated at maximum importance or confidence because the financing is not essential for meeting the company's current financial guidance, suggesting that while beneficial, it is not critical to the company's immediate financial health.
CONFIDENCE 90
IMPORTANCE 85
RELEVANCE 100