Terms of subscription

LACROIX SHARES

Denomination: LACROIX
Listing market: Euronext Paris
Mnémonique : LACR
ISIN code : FR0000066607
LEI : 9695009SISMDAOR3GO20
ICB classification:  Autres biens d’équipement
ISIN code of the Preferential Subscription Rights: FR0014004CE4 (listed and negotiable from July 7, 2021 to July 19, 2021)

ISSUE PRICE

€41,65 per New Share, i.e. a discount of 15.0% compared to the closing price of the LACROIX share on 30th June 2021.
The exercise ratio is 7 New Shares for 23 Preferential Subscription Rights.

SUBSCRIBING TO THE CAPITAL INCREASE

If you are already a shareholder:

You have Preferential Subscription Rights attached to your LACROIX shares, which allow you to subscribe as a priority, on an irreducible basis, for the New Shares by applying the ratio 7 New Shares for 23 Preferential Subscription Right(s) (1 share held giving the right to 1 Preferential Subscription Right).

• If you have an exact and sufficient number of Existing Shares to be able to subscribe via your Preferential Subscription Rights to a whole number of New Shares (for example, if you have 23 LACROIX shares, you will be able to subscribe by priority to 7 New Shares),
• If you do not have a sufficient number of Existing Shares to obtain a whole number of New Shares, you may therefore buy or sell the number of Preferential Subscription Rights to reach the ratio leading to a whole number of New Shares (7 New Shares for 23 Preferential Subscription Rights).

You may also subscribe for the number of New Shares that you wish, in addition to the number of New Shares resulting from the exercise of your Preferential Subscription Rights. Any New Shares that are not absorbed by subscriptions on an irreducible basis shall be distributed and allocated to subscribers on a reducible basis.

Reducible subscription orders will be served within the limit of their requests and in proportion to the number of Preferential Subscription Rights exercised in support of their irreducible subscription, without this resulting in the allocation of a fraction of the New Shares. A reduction scale will be applied and communicated when the results of the Capital Increase are announced by Euronext Paris.

If you are not yet a shareholder:

You can subscribe by acquiring Preferential Subscription Rights on the stock market from 7 July 2021 until 19 July 2021, through the financial institution in charge of your securities account, and:

• By irreducible subscription, at the latest on 21 July 2021, by exercising your Preferential Subscription Rights through the financial institution in charge of your securities account;
• And, where applicable, by reducible subscription to New Shares by placing an order through the financial institution in charge of your securities account, no later than 21 July 2021.

You can only subscribe on a reducible basis if you have already subscribed on an irreducible basis. The ISIN code for these Preferential Subscription Rights is FR0014004CE4.

Terms of the transaction

Subscription terms

Subscription for the Offering Shares shall be reserved, by preference (i) for existing shareholders registered in their securities account at the end of the day of 6 July 2021 according to the indicative timetable, for an existing preferential subscription right per share and (ii) for assignees of preferential subscription rights.

The holders of preferential subscription rights may subscribe, from 9 July 2021 until the end of the subscription period, i.e. until 21 July 2021 inclusive, by exercising their preferential subscription rights (i) on an irreducible basis, at the rate of 7 New Shares for 23 existing shares held, without this resulting in an allocation of a fraction of New Shares and (ii) on a reducible basis, the number of Offering Shares which they would like in addition to that due to them exercising their rights on an irreducible basis, being specified that only the Offering Shares which may not be subscribed on an irreducible basis, will be allocated between subscribers on a reducible basis, to the extent of their demand, and pro rata the number of existing shares from which rights will have been exercised to subscribe on an irreducible basis, without this resulting in an allocation of a fraction of New Shares. Preferential subscription rights forming odd lots may be sold on Euronext Paris during the preferential subscription rights trading period.

Gross amount of issue

The total amount of this issue, including issue premium, is 47.7 million euros (of which 7.6 million euros nominal and 40.1 million euros issue premium). This figure may amount to 54.9 million euros if the Extension Clause is fully exercised.

Net proceeds of the transaction and use thereof

The estimated net proceeds from the Offer amount to approximately 46.3 million euros (which may increase to approximately 53.2 million euros if the Extension Clause is exercised in full. It will contribute globally to the financing of the Company’s development and the axes of the “Leadership 2025” strategic plan. Over the duration of the plan, the breakdown of needs per axis is as follows:

1. Approximately 37% towards extending international reach and M&A, with the ambition of conducting more than 70% of total business outside France within 5 years. LACROIX particularly intends to carry out targeted acquisitions allowing to strengthen existing activities abroad, and also take position on complementary market segments, or expand the “smart” offer by integrating new high value-added technological building blocks.
2. Approximately 35% towards the reinforcement of the Group’s technological leadership with the development of technological platforms around key expertise such as cybersecurity or edge computing. In that respect, the set objective is to double R&D expenditure to more than 5% of total revenue. This reinforcement of resources towards innovation should allow, for the revenue from LACROIX design, to drive the share of new products (less than 5 years) to 50%.
3. Approximately 27% towards developing leadership in industrial efficiency, particularly relying on opportunities offered by “Industry 4.0”, with an increased role of artificial intelligence and robotisation, the digitisation of flows, and the application of Lean production methods. As with its new future French electronics factory “Symbiose”, to be completed at the end of 2021, these methods will apply to 100% of the Group’s industrial sites by 2025.
4. Finally, to a lesser extent, approximately 1% for the start of the transition from equipment manufacturer to that of a supplier of high value-added end-to-end solutions for the Smart World, with the deployment of new services generating recurring revenue and margin appreciation.

The first axis 1) presented above will require, in particular, the use of the net proceeds from the Offer, given that the other needs could be mostly self-financed. Consequently, if the Offer is 75% completed, the budget allocated to M&A in this first axis 1) would be reduced. Without affecting the determination increase the international reach, this decrease would impact the size of the targets sought.

Subscription commitments

The group made up of shareholders who are members of the Bedouin family (the “Bedouin Family”), a reference shareholder holding 70.39% of the Company’s capital before the Offer, has undertaken under customary conditions, to subscribe on an irreducible basis by exercising part of its preferential subscription rights, to new shares of the Company, in the amount of €15 million, through Vinila Investissements, which itself holds 57.59% of the Company’s capital prior to the Offer (representing approximately 31% of the total amount of the Offer). This subscription commitment by Vinila Investissements may be completed by a complementary subscription on a reducible basis for a maximum amount of €2 million, to the extent it is necessary for subscriptions to reach 75% of the amount of the Offer.
Furthermore, ten investors, some of which are shareholders of the Company, have irrevocably undertaken to subscribe to the Offer for an amount of €19 million (representing 40% of the total amount of the Offer), of which €17.1 million on an irreducible basis, mainly by exercising preferential subscription rights previously purchased from the Bedouin Family at the lump-sum price of 1 euro per block of preferential subscription rights, and €1.9 million on a reducible basis.
Thus, the total of subscription commitments amounts to 34 million euros (representing 71% of the total amount of the Capital Increase with PSR), to which may be added the complementary subscription from Vinila Investissements for a maximum amount of €2 million, representing 75% of the total amount of the Capital Increase with PSR.
At the date of the present Prospectus, the Company is not aware of any intention of other shareholders or members of its administrative or management bodies to participate in the Offer.

Commitment to retain shares

The Bedouin Family has undertaken to retain its Lacroix shares until the expiry of a period of twelve months from the settlement-delivery date of the Offering Shares, it being specified that the New Shares subscribed by Vinila Investissements in the context of the Offer will be subject to the same retention commitment.

Commitments to abstain

Under the investment agreement entered into with Portzamparc (BNP Paribas Group), acting as Global Coordinator and Joint Bookrunner of the Offer and Gilbert Dupont, acting as Joint Bookrunner of the Offer, the Company made a commitment to abstain for a period of 180 days from the date of settlement-delivery of the Offering Shares.

Impact of the Offer on the distribution of capital and voting rights

* It being specified that the number of treasury shares is subject to variation depending on the vesting of 15,002 existing free shares, thereby reducing the number of treasury shares.

Impact of the issue on the financial position of the shareholder

For information purposes, the impact of the issuance of the Offering Shares on the stake of a shareholder owning 1% of the Company’s capital prior to the issue of the Offering Shares and not subscribing to the issue of the Offering Shares (calculations made on the basis of the number of shares forming the Company’s share capital on the date of this press release, after deduction of treasury shares), would be as follows:

Placement – Warranty

The Offering Shares shall be placed by Portzamparc (BNP Paribas Group) and Gilbert Dupont as Joint bookrunners, both acting in accordance with the terms of a Placement Agreement entered into with the Company. This contract does not constitute a performance guarantee within the meaning of Article L. 225-145 of the French Commercial Code.

Offer Schedule

Information to the public

The Prospectus, drawn up in the form of a Union reminder prospectus in accordance with Article 14a and Annex V bis of the Prospectus Regulation amended by Regulation (EU) 2021/337 of 16 February 2021, has received from the AMF the approval number 21-271 dated 2 July 2021 and is available on both the AMF (www.amf-france.org) and Company (https://www.lacroix-group.com/) websites. Risk factors related to the Group, its business segments, markets and offered securities are described in Section IV of the Prospectus. The listing of risks is not exhaustive. At the date of approval of this Prospectus, other risks which have not been identified or regarded as significant by the Company may exist. Potential investors are advised to read the Prospectus before making an investment decision in order to fully understand the potential risks and benefits associated with the decision to invest in the securities. The approval of the Prospectus by the AMF should not be construed as a favourable opinion on the securities offered or admitted to trading on a regulated market.

Disclaimer

This press release does not constitute, and shall not be deemed to constitute, an offer to the public, an offer to purchase or subscribe for shares or an offer to solicit the public for the purpose of a public offering. This press release does not constitute an assessment of the merits of an investment in the Company. No guarantee is given as to the completeness, reality and accuracy of the information provided. The information and opinions contained in this press release as well as all the elements presented at today’s information meeting are provided on the date of this press release and are subject to change at any time. Some of the information contained in the press release is purely forward-looking and prospective. This information is given as of the date of the press release and no guarantee is given as to the reliability of this information, which the Company will not be under any obligation to update.
No communication or information relating to the proposed capital increase may be disseminated to the public in any country in which a registration or authorisation requirement must be satisfied. No steps have been taken (or will be taken) in any country (other than France) in which such steps would be required. The subscription or purchase of Company securities may be subject to specific legal or regulatory restrictions in certain countries. The Company assumes no liability for any violation by any person of such restrictions.
The press release does not constitute a prospectus within the meaning of Regulation (EU) 2017/1129 of the European Parliament and of the Council of 14 June 2017 (the “Prospectus Regulation”). The offer will be open to the public in France only after the Autorité des marchés financiers has issued an approval on the prospectus prepared in accordance with the Prospectus Regulation.
In France, the public offering of securities requires a prospectus approved by the AMF. With regard to the Member States of the European Economic Area other than France (the “Member States”), no action has been taken or will be taken to allow a public offering of securities making it necessary to publish a prospectus in one of these Member States. Consequently, the securities may not and will not be offered in any of the Member States (other than France), except in accordance with the exemptions provided for in Article 1(4) of the Prospectus Regulation, or in other cases not requiring the publication by the Company of a prospectus under the Prospectus Regulation and/or the regulations applicable in these Member States.
The release has not been approved by an authorised person (“authorised person”) within the meaning of Section 21(1) of the Financial Services and Markets Act 2000. Consequently, the press release is intended solely for (i) persons located outside the United Kingdom, (ii) investment professionals within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, (iii) persons referred to in Article 49(2) (a) a (d) (high net worth companies, unregistered associations, etc.) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 or (iv) any other person to whom the press release may be sent in accordance with the law (the persons referred to in paragraphs (i), (ii), (iii) and (iv) together being referred to as the “Authorised Persons »). Any person other than an Authorised Person must refrain from using or relying on the press release and the information it contains. The press release is not a prospectus approved by the Financial Services Authority or any other UK regulator within the meaning of Section 85 of the Financial Services and Markets Act 2000.
The press release does not constitute an offer of securities or any solicitation to purchase or subscribe for securities or any solicitation to sell securities in the United States. The shares of the Company described in this press release have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the “U.S. Securities Act”) and may not be offered or sold in the United States without registration or exemption from the registration obligation under the U.S. Securities Act. The Company does not intend to make any public offering of its shares in the United States.
This press release may not be published, distributed or circulated, directly or indirectly, in the United States, Australia, Canada or Japan. The distribution of this press release in other countries may be subject to legal or regulatory restrictions, and persons in possession of this document should become familiar with and observe such restrictions. Failure to comply with such restrictions may constitute a violation of applicable securities laws.