Cresent Cap Advisors establishes fee structure for Alcentra Capital acquisition
Following the transaction, Crescent BDC stockholders and Alcentra Capital stockholders are expected to own approximately 81% and 19%, respectively, of the combined company, which will remain externally managed by Crescent Cap Advisors. All Crescent BDC officers and directors in office immediately prior to the closing of the transaction will remain in their current roles following closing. In connection with the transaction, Crescent Cap Advisors has agreed to establish a fee structure and amend its current investment management agreement with Crescent BDC to take effect immediately after the closing of the transaction.The fee structure includes annual base management fee rate reduced from 1.50% to 1.25%; six quarters of base management fee waivers, so that only 0.75% will be charged for such time period; annualized incentive fee hurdle increased from 6% to 7% while maintaining a 17.5% income incentive fee and six quarters of full waivers of the income-based portion of the incentive fee. Additionally, Crescent BDC will implement a stock repurchase program for a period of twelve months following the closing of the transaction via open-market share repurchases in an aggregate amount of up to $20M, less any amounts provided under any repurchase program for Crescent BDC stock that is entered into by affiliates of Crescent BDC or Crescent Cap Advisors, subject to certain regulatory restrictions. Over two-thirds of Crescent BDC's stockholders already support the transaction and have agreed to vote their shares in favor of the merger and related transactions. Additionally, Crescent BDC stockholders generally will be restricted from trading their shares for at least six months following the closing of the transaction, subject to a modified lock-up schedule thereafter for an additional six months. Consummation of Crescent BDC's acquisition of Alcentra Capital is subject to Alcentra Capital stockholder approval, customary regulatory approvals and other closing conditions. The transaction is expected to close in Q4.