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GFL to close Fashion Place & Shops at Riverwood
12
Feb '08
Nexia Holdings Inc wholly owned subsidiary Gold Fusion Laboratories Inc (GFL) announced that it will be closing two of its underperforming Black Chandelier retail stores. GFL has decided to close its Fashion Place and Shops at Riverwood locations, which were the newest out of a total of four stores.

GFL has been unable to raise sufficient capital to properly merchandise all of its locations, which has undermined recent sales results. Nexia plans to reduce its retail sales force by approximately 20 persons. Black Chandelier plans to consolidate product density from its closed stores to its two remaining retail outlets, while saving an estimated $50,000 in negative cash flow per month.

Nexia has been attempting to raise up to $10 million in an equity line of credit and has been unable to get the registration statement cleared through the Securities and Exchange Commission for over 20 months. Management did not originally expect the comment process to take longer than six (6) months.

The accompanying expenses related to filing the SB-2 registration statement and amendment have resulted in longer than expected SEC reviews and a subsequent change in Nexia's outside auditing firms. Richard D. Surber, CEO of Nexia Holdings, stated, “If Nexia had been able to raise funds through the equity line of credit, we would have been able to build up the inventories at our newest two stores, which would have better positioned us to weather the ongoing economic downturn.”


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