As LSB Industries, Inc. (“LSB” or “the Company”), (NYSE: LXU),
previously announced, the New York Stock Exchange (“NYSE”) halted
trading on LSB’s common stock on October 12, 2021 in order to
address the impact on the stock price of the dividend paid by the
Company on October 8, 2021 to shareholders of record on September
24, 2021 of 0.30 shares of LSB common stock for every share
owned.
Before trading began on the October 12, 2021 ex-dividend date,
the NYSE communicated, via an NYSE Group Info Notice, that LSB’s
0.3:1 common stock dividend applied to ALL approximately 79.4
million of the Company’s shares of common stock that were
outstanding prior to the dividend payment date. That was incorrect.
In actuality, the stock dividend was paid on only approximately
30.4 million of LSB’s outstanding shares of common stock. The other
approximately 49.1 million shares of the total outstanding common
shares were issued to LSB Funding LLC, an affiliate of Eldridge, in
the exchange transaction that closed on September 27, 2021 and
since they were not issued prior to the September 24, 2021 record
date, were not eligible to receive the stock dividend. The Company
believes the distribution of the incorrect information in the
NYSE’s Group Info Notice led to a 30% downward adjustment to its
closing stock price on October 11, 2021.
In addition to halting the trading of LSB’s common stock the
morning of October 12, 2021 during the trading day on October 12th,
the NYSE issued an update to its prior Group Info Notice regarding
the Company’s stock dividend that (1) rescinded their prior Group
Info Notice; (2) correctly stated that the approximately 49.1
million shares of common stock issued to LSB Funding LLC in the
exchange transaction did not receive the stock dividend that was
paid on October 8, 2021 and (3) that stated, “the price adjustment
should be reflective of shares outstanding prior to the exchange
offer.” Thus, confirming that the stock dividend only resulted in
an approximate 11.5% increase in the number of shares of the
Company’s common stock outstanding on the dividend payment date of
October 8, 2021.
The Company believes that the most accurate way to assess the
impact of the stock dividend on its common stock price on October
12, 2021 would be to divide the number of shares issued for the
special stock dividend of approximately 9.2 million shares by the
approximately 79.4 million shares outstanding prior to the issuance
of the Company’s stock dividend, which equates to an estimated
11.5% impact on the Company’s stock price, or a reduction of the
stock’s October 11, 2021 closing price of $12.83 to approximately
$11.35. As of October 12, 2021, after giving effect to the
consummation of the exchange transaction and the issuance of shares
in the common stock dividend, the Company had approximately 88.6
million shares of common stock outstanding, consistent with the
level projected in the Company’s September 27, 2021 press release
announcing the closing of the exchange transaction.
About LSB Industries, Inc.
LSB Industries, Inc., headquartered in Oklahoma City, Oklahoma,
manufactures and sells chemical products for the agricultural,
mining, and industrial markets. The Company owns and operates
facilities in Cherokee, Alabama, El Dorado, Arkansas and Pryor,
Oklahoma, and operates a facility for a global chemical company in
Baytown, Texas. LSB’s products are sold through distributors and
directly to end customers primarily throughout the United States.
Additional information about the Company can be found on its
website at www.lsbindustries.com.
About Eldridge
Eldridge invests in businesses across the Insurance, Asset
Management, Technology, Mobility, Sports & Gaming, Media &
Music, Real Estate, and Consumer landscapes. The firm seeks to
build and grow businesses led by proven management teams that have
demonstrated leadership and experience to scale an enterprise.
Eldridge is headquartered in Greenwich, Connecticut, with
additional offices in Beverly Hills, New York, and London.
Additional information about Eldridge can be found on its website
at www.eldridge.com
Forward-Looking Statements
Statements in this release that are not historical are
forward-looking statements within the meaning of the U.S. Private
Securities Litigation Reform Act of 1995. These forward-looking
statements, which are subject to known and unknown risks,
uncertainties and assumptions about us, may include projections of
our future stock price and financial performance including the
effects of the previously announced stock dividend, the COVID-19
pandemic and anticipated performance based on our growth and other
strategies and anticipated trends in our business. These statements
are only predictions based on our current expectations and
projections about future events. There are important factors that
could cause our actual results, level of activity, performance or
actual achievements to differ materially from the results, level of
activity, performance or anticipated achievements expressed or
implied by the forward-looking statements. Significant risks and
uncertainties may relate to, but are not limited to, the trading
price for our common stock following the ex-dividend date of our
previously announced stock dividend that was paid on October 8,
2021, business and market disruptions related to the COVID-19
pandemic, market conditions and price volatility for our products
and feedstocks, as well as global and regional economic downturns,
including as a result of the COVID-19 pandemic, that adversely
affect the demand for our end-use products; disruptions in
production at our manufacturing facilities; and other financial,
economic, competitive, environmental, political, legal and
regulatory factors. These and other risk factors are discussed in
the Company’s filings with the Securities and Exchange Commission
(“SEC”), including its Annual Report on Form 10-K for the year
ended December 31, 2020.
Moreover, we operate in a very competitive and rapidly changing
environment. New risks and uncertainties emerge from time to time,
and it is not possible for our management to predict all risks and
uncertainties, nor can management assess the impact of all factors
on our business or the extent to which any factor, or combination
of factors, may cause actual results to differ materially from
those contained in any forward-looking statements. Although we
believe the expectations reflected in the forward-looking
statements are reasonable, we cannot guarantee future results,
level of activity, performance or achievements. Neither we nor any
other person assumes responsibility for the accuracy or
completeness of any of these forward-looking statements. You should
not rely upon forward-looking statements as predictions of future
events. Unless otherwise required by applicable laws, we undertake
no obligation to update or revise any forward-looking statements,
whether because of new information or future developments.
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version on businesswire.com: https://www.businesswire.com/news/home/20211013005614/en/
Cheryl Maguire, Executive Vice President & CFO (405)
510-3524
Fred Buonocore, CFA, Vice President of Investor Relations (405)
510-3550 fbuonocore@lsbindustries.com
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