Q1 2025 Shareholder Letter — Crossroads Impact Corp. (January 8, 2025)

Summary

A Q1 2025 Shareholder Letter dated January 8, 2025 states that on December 23, 2024, the Company closed on a transaction to redeem its common stock from its two institutional investors, pursuant to a redemption and purchase agreement. The Company sold preferred equity investments to the institutional investors for approximately $62M in cash, and transferred all of its impact assets, excluding CDFI assets, totaling approximately $356 million together with the associated debt, in exchange for the redemption of approximately 16 million Crossroads shares and net cash consideration of approximately $60.0 million. The cash will be used to pay off a bridge loan and accrued liabilities. The advisory agreement with Enhanced Capital Partners was terminated, and approximately 5.5 million shares are outstanding.

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Q1 2025 Shareholder Letter

January 8, 2025

Dear Crossroads Investor:

On December 23, 2024, the Company closed on a transaction to redeem the Company’s common stock held by its two institutional investors. The institutional stockholders had received certain rights as part of their original investment, and the shares were redeemed pursuant to a redemption and purchase agreement, based on the tangible book value of the Company as of September 30, 2024 in full satisfaction of all of such rights. In addition, as part of the transaction the Company sold to the institutional investors and/or their designees and affiliates certain preferred equity investments for approximately $62M in cash pursuant to a membership interest purchase agreement.

The transaction included transferring all of the Company’s impact assets, excluding CDFI assets, totaling approximately $356 million together with the associated debt in exchange for the redemption of approximately 16 million Crossroads shares and net cash consideration of approximately $60.0 million. The cash consideration will be used to pay off a bridge loan and the Company’s accrued liabilities. As part of the transaction, a portion of the consideration due to the Company was satisfied through the issuance, pursuant to a loan agreement, of a note to the Company by an affiliate of the institutional stockholders being redeemed. As a part of the transaction, the Company also terminated its advisory agreement with Enhanced Capital Partners dating back to 2021 and Mr. Levy resigned from the Company’s board of directors. The commercial lending operation will be fully integrated inside the company.

The transactions described above were approved by the Company’s board of directors and by the holders of a majority of the Company’s outstanding stock.

As a result of the transaction, the Company currently has approximately 5.5 million shares outstanding. The Company is currently evaluating initiatives inside the CDFI as well as Crossroad’s certification as a CDFI to grow its commercial lending platform. The Company also continues to work through the outstanding PPP loans with the SBA and expects to have an investor update within the next several months.

We appreciate our investor support over the past several years and expect to have a broader business update in the near future.

Sincerely,

CRSS Management and Board

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