Today before the opening bell, Net Element
announced its entry into a debt exchange agreement with Crede CG III, Ltd., a
wholly owned subsidiary of Crede Capital Group, LLC. With the agreement, Net
Element immediately eliminated $15,876,860 of indebtedness under certain
promissory notes. This balance sheet development will be reflected in Net
Element’s quarterly financial results for the period ending September 30, 2014.
In exchange, Crede paid more than $15 million to Net Element’s note holders for
such promissory notes. Upon acquiring them, Crede exchanged them for common
stock in Net Element.
“In addition to saving on the financing
expenses associated with holding high-interest loans, we have freed up a
significant amount of cash flow and strengthened our balance sheet by replacing
debt with equity. The increased financial flexibility provided by this
transaction positions us to take advantage of growth opportunities and
partnerships in promising areas such as mobile payments,” said Oleg Firer, CEO
of Net Element.
Additional information regarding the financing
can be found in Net Element’s Form 8-k, which Net Element filed with the SEC on
today, September 15, 2014.
Net Element is a global technology-driven
group specializing in mobile payments and value-added transactional services.
The Company owns and operates a global mobile payments and transaction
processing provider, TOT Group.
TOT Group’s companies include: Unified
Payments, recognized by Inc. Magazine as the #1 Fastest Growing Private Company
in America in 2012; Aptito, a next-generation, cloud-based point-of-sale
payments platform; and TOT Money, which has been ranked as the #1 SMS content
provider by Russia’s second-largest telecommunications operator.
For more information, visit: www.netelement.com
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