Crescent NV Enters Into a Financing Agreement With LDA Capital Limited

Rhea-AI Summary

Crescent (EURONEXT: OPTI; OTC: OPNVY) has secured a financing agreement with LDA Capital Limited for up to EUR 9.9 million over three years in exchange for shares. The commitment includes a minimum issuance of EUR 5 million within 18 months. The financing will be released via put options, allowing Crescent flexibility in capital calls. LDA will hold a non-controlling interest, supporting Crescent's growth without management involvement. Additionally, LDA receives warrants for up to 46.4 million shares at an exercise price of EUR 0.046. This deal aims to enhance Crescent's capital for strategic acquisitions and IoT solutions development.

Positive

• Capital commitment of up to EUR 9.9 million for growth and acquisition financing.
• Flexibility in financing through put options based on trading volume.
• Partnership with LDA to support strategic growth and acquisitions.

Negative

• Potential dilution of existing shareholders due to new share issuance.
• EUR 198,000 fee to LDA represents 2% of maximum capital commitment.

Crescent (EURONEXT: OPTI; OTC: OPNVY) announces it has entered into a financing agreement with LDA Capital Limited (“LDA”). LDA is a Los Angeles based global investment group with expertise in cross-border transactions in the enterprise technology sector including Cybersecurity, AI, IOT and SaaS.

LDA agreed to commit an amount of up to EUR 9.9 million (the "Capital Commitment") in cash within a maximum of three years in exchange for new ordinary shares in Crescent. Crescent has committed to issue a minimum amount of EUR 5 million in shares to LDA Capital within 18 months.

This Capital Commitment will be released based on capital calls by Crescent in the form of put options which Crescent has the right to exercise at its own discretion. The amount of the put options will be determined by Crescent and depend on certain parameters such as Crescent's trading volume during the previous 15 trading day period prior to the day of issuance of a put option. The strike price of the put option will be determined by the volume weighted average price (VWAP) of Crescent's shares during a 30-day pricing period following the day of issuance of a put option notice and fixed at 90% of this strike price implying a 10% discount. The minimum subscription price of the new shares shall not be lower than EUR 0.03, unless otherwise agreed by LDA Capital and Crescent.

Upon each exercise of the put option, LDA will subscribe to a minimum of 60% of the volume of shares requested by Crescent. LDA has agreed to hold no more than 19.9% of Crescent's common stock. As LDA seeks a non-controlling interest it will not be involved in management, nor will hold a seat in the Board of Directors. However, given LDA’s expansive network in the Technology sector LDA will seek to support Crescent’s growth plans by potentially identifying attractive acquisition opportunities.

As part of the Capital Commitment, LDA is entitled to receive warrants for up to 46,400,000 new Crescent ordinary shares at an exercise price of EUR 0.046 per ordinary share (subject to customary adjustments). Crescent will seek approval of an Extraordinary General Assembly to issue the warrants. The warrants have a term of three years and will be exercisable once issued. Crescent will make available its report of the Board of Directors within the framework of the transaction with LDA Capital, in accordance with articles 7:180, 7:191 and 7:193 WVV, in which it will give an account of the proposed transaction, in particular an account of the proposed exercise price of the LDA Warrants, and a description of the consequences for the financial and shareholders rights of the existing shareholders within the framework of the transaction with LDA Capital.

The Put Option Agreement provides that the Company will pay LDA a fee of EUR 198,000 (2% of the maximum amount of EUR 9,900,000).

Eric Van Zele, Chairman & CEO, Crescent stated, “We sought LDA’s alternative form of financing because it provides ample flexibility and non-restrictive capital to support our growth objectives to become a leading provider of IoT solutions. Despite pandemic related obstacles and delays, Crescent has identified and secured several major growth opportunities and projects, anticipating a substantial need for additional working capital and acquisition financing. Moreover, the Capital Commitment will strengthen our balance sheet and allow for Crescent to also make strategic acquisitions and investments in new software capabilities and supplementary sensing competencies.”

Warren Baker, Managing Partner of LDA Capital, said: “We are pleased to back an experienced management team with an established international track record in the electrical and electronic manufacturing industry. The last 12 months have only accelerated the critical role of technology in connecting our society -- Crescent’s comprehensive IoT solutions platform and its ability to deliver on IoT projects across a broad range of industries uniquely positions the Company to take advantage of the exponential growth in the sector.”

About LDA Capital
LDA Capital is a global alternative investment group with expertise in cross border transactions worldwide. Our team has dedicated their careers to international & cross border opportunities having collectively executed over 200 transactions in both the public and private middle markets across 43 countries with aggregate transaction values of over US$10 billion. LDA has recently completed several investments in enterprise technology companies including investments in cybersecurity, artificial intelligence, and SaaS businesses. For more information please visit: www.ldacap.com; For inquires please email: info@ldacap.com

About Crescent
Crescent NV was created May 2018 with the ambition to become a leading end-to-end IoT solutions integrator. The group is organized along 3 business units: Crescent Solutions, formed by Option, renowned developer & manufacturer of IoT components and solutions for worldwide markets, SAIT and Maro. Crescent Lighting, represented by Innolumis Public Lighting, leading developer and producer of smart and energy-efficient public lighting based on LED technology. Crescent Services, home for 2Invision, trusted providers of managed, cloud & infrastructure services. Crescent is ideally positioned to offer efficient, reliable and secure IoT solutions across a variety of industries and applications. The expertise of this group of companies, make Crescent a one stop shop and ideal partner for the development and implementation of innovative IoT integration projects.

View source version on businesswire.com: https://www.businesswire.com/news/home/20210121005952/en/

FAQ

What is the financing agreement between Crescent and LDA Capital?

Crescent has entered into a financing agreement with LDA Capital for up to EUR 9.9 million over three years, with a minimum issuance of EUR 5 million within 18 months.

How does the put option work for Crescent?

Crescent can exercise put options at its discretion, with amounts based on trading volume and a strike price set at 90% of the volume weighted average price.

What will LDA Capital's role be in Crescent?

LDA Capital will hold a non-controlling interest and will not participate in management but will support Crescent's growth by identifying acquisition opportunities.

What is the exercise price for the warrants issued to LDA?

LDA is entitled to warrants for up to 46.4 million shares at an exercise price of EUR 0.046 per share.

What are the financial implications of this agreement for existing shareholders?

The issuance of new shares may dilute existing shareholders' stakes, and there is a fee of EUR 198,000 payable to LDA.