New York, September 29, 2022 /PRNewswire/ — ALJ Regional Holdings, Inc. (OTC PINK: ALJJ) (“ALJ) today announced that it has acquired an unpaid equity interest in certain operating companies, doing business as Ranew’s Companies. Lester and Susan LanewRanew’s Companies headquartered in . Milner, Georgiais a leading supplier of industrial coating services to multinational equipment manufacturers, providing precision manufacturing, assembly and logistics services. The transaction was completed pursuant to the securities purchase agreement. September 28, 2022 (“purchase contractThe consideration paid by ALJ for the acquisition at the time of closing was $20.8 million, subject to certain purchase price adjustments and certain earn-out payments set forth in the Purchase Agreement and described below. This acquisition is part of Resin Acquisition Corp. (“buyer“), a subsidiary of ALJ.
As a result of the transaction, Buyer will become the owner of Ranew’s Truck & Equipment Company, LLC, Ranew’s Outdoor Equipment, Inc., Ranew’s Management Company, Inc., Ranew’s Well Services Division, LLC, Ranew’s Companies, LLC and Ranew’s texas,Ltd. At closing, the Purchaser issued his 19.99% of the Purchaser’s Interest to Mr. Ranew in consideration of the rollover of a portion of Mr. Ranew’s interest. ALJ and the Purchaser have entered into a shareholder agreement providing for certain customary rights with Mr. Ranew and his trading rights from the 5th (5th).th) At ALJ’s option, the closing date for ALJ to either: Lester Lanew or (ii) to whom it is sold Lester Lanew In either case, all shares of common stock of the purchaser held by ALJ shall Lester Lanew.
Ranew’s Companies’ 2021 unaudited consolidated earnings are approximately $42 millionthe net profit is about $5.5 millionand for the terminated six months June 30ththe unaudited consolidated earnings of Ranew’s Companies are approximately $32.5 million Net profit is about $2.7 millionThese results are unaudited, are not prepared in accordance with GAAP and are subject to adjustment.
The purchase contract contains Lester LanewEach Earnout Payment is equal to the product of adjusted EBITDA over EBITDA over the last 12 months (“TTM“) The period prior to the applicable Earn Out Payment Date multiplied by 3.25.
As of the closing date, ALJ has employment contracts with the following companies. robert blockas Chief Executive Officer; (ii) clay harmonas Chief Financial Officer, and (iii) Blake Reeves, as Operations Director. The employment contract contains customary conditions including an annual bonus based on EBITDA growth.
repurchase transaction
while August 31, 2022When September 12, 2022ALJ has completed the repurchase of approximately 1.5 million additional shares of common stock for a total of approximately $2.9 million The range of repurchase prices per share is $1.84 – $1.94The share repurchase was completed through an unsolicited private transaction.
Investment in A-Mark Precious Metals
upon September 16, 2022ALJ has purchased a total of 350,000 shares of A-Mark Precious Metals, Inc (NASDAQ: AMRK) on the open market (“markMr. Ravich is a member of A-Mark’s board of directors and the related party transaction was approved by a majority of the disinterested directors of ALJ’s board of directors. A-Mark is a leading fully integrated precious metals trading company. Company.
Investment in Hallador Energy
upon August 12, 2022ALJ purchased an unsecured convertible promissory note (“Note“) from Hallador Energy Company (NASDAQ: HNRG) (“Harador“) total principal $10 millionThe note will include interest payable at the rate of 8% per annum, at the discretion of Harador, in cash or at a 30-day volume weighted average price (“VWAP“) Also $6.15 (Trailing VWAP on exit). The principal balance and all accrued interest shall be paid on the maturity date of the Notes. December 31, 2026, and advance payments of such amounts are not permitted. The Notes also contain the right to convert the amount of principal and accrued interest issued in the Notes (all but not a portion) into common shares of Harador at a fixed conversion price. $6.15 (Trailing VWAP on exit). In connection with the above, ALJ and Hallador have entered into a registration rights agreement under which ALJ has customary issuance, claim and piggyback registration rights with respect to shares issued upon conversion of the debentures. I can do it.
Investing in Eligible Opportunity Zones
Phoenix Color Corp. and Faneuil, Inc. (“prior sale transaction”), ALJ has exhausted its net operating loss carryforward. September 26, 2022about $20 million 99% owned subsidiary ALJ Qualified Opportunity Fund LLC (“QOFsQOF expects to invest such proceeds in Eligible Opportunity Zone businesses. This may be subject to tax benefits, such as allowing the ALJ to defer capital gains from previous sale transactions under certain conditions.
About ALJ
ALJ Regional Holdings, Inc. is a wholly owned owner of (i) Faneuil, Inc. Faneuil, Inc. is a leading provider of call center services, back office operations, staffing services and toll collection services to commercial and government clients. usa(ii) 100% owner of Realtime Digital Innovations, Inc. d/b/a Vistio, which provides workflow automation and business intelligence services to Faneuil and other unaffiliated companies; (iii) 99% owner of the QOF; (iv) 80.01% owner of Ranew’s Companies, a leading supplier of industrial coating services to multinational equipment manufacturers, providing precision manufacturing, assembly and logistics services.
Forward-Looking Statements
This press release contains “forward-looking statements” within the meaning of the US federal securities laws regarding the ALJ and Ranew companies and transactions. Lester Lanew, if any; future operations; future performance of ALJ and Ranew’s Companies; All results of Ranew’s trades. Investments made in eligible Opportunity Zones (if applicable). and tax incentives related to investments in qualified opportunity zones made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. , “preliminary”, “will”, “could”, “should”, “can”, “will”, “plan”, “intention”, “plan”, “goal”, “guideline”, “goal”, “continue”, “maintain”, “synergy”, “on track”, “believe”, “seek”, “estimate”, “expect”, “potential”, “May”, “assume” and variations of such words and these statements involve certain risks and uncertainties and actual results or performance may not be Do not place undue reliance on these statements, as they may differ materially from those described. Actual results that differ materially include, but are not limited to, general economic and capital market conditions; unanticipated costs, charges or expenses; f failure to achieve expected results; . and other risks and uncertainties. Although forward-looking statements contained in this presentation are based on what our management believes to be reasonable assumptions, actual results and future events could differ materially from expectations. There can be no assurance that forward-looking statements will prove to be accurate. with such a statement. All forward-looking statements in this release are made as of the date of this release, and we undertake no obligation to update any forward-looking statements.
Non-GAAP Financial Measures and Related Information
This press release contains certain financial measures that are not presented in accordance with generally accepted accounting principles (“GAAP“), including Adjusted EBITDA. These are not measures of financial performance calculated in accordance with GAAP and may exclude items material to understanding and evaluating the financial results of Ranew’s companies. GAAP. are superior to measures of financial performance prepared in accordance with and are considered alone or as a proxy for net income, cash flow from operations or other measures of profitability, liquidity or performance under GAAP; The presentation of these measures by Ranew’s Companies may not be comparable to similarly titled measures used by other companies.
Source ALJ Regional Holdings, Inc.
