Interim Financing and Financial Update
06 9월 2010 - 3:00PM
UK Regulatory
TIDMCTS TIDMCTSU
RNS Number : 1712S
Catalytic Solutions, Inc.
06 September 2010
THIS ANNOUNCEMENT IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR
INDIRECTLY, IN WHOLE OR IN PART, IN, INTO OR FROM UNITED STATES, JAPAN, CANADA
OR AUSTRALIA OR ANY OTHER JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A BREACH
OF THE RELEVANT SECURITIES LAWS OF SUCH JURISDICTION.
+-------------------------------+------------------------------------+
| For Immediate Release | 6 September 2010 |
+-------------------------------+------------------------------------+
Catalytic Solutions, Inc.
(the "Company")
interim financing and financial update
Catalytic Solutions, Inc. ("CTS") (AIM: CTS and CTSU), the company behind Mixed
Phase Catalyst (MPC ) technology, announces today that further to its
announcement of 31 August 2010, it has completed negotiations and executed
finalised forbearance agreements with its secured convertible note holders,
received extended forbearance from its secured lender, Fifth Third Bank, and
reached agreement with Clean Diesel Technologies, Inc. ("CDTI") and CDTI Merger
Sub, Inc. to amend Section 8.1(c) of the Agreement and Plan of Merger dated 13
May 2010 (the "Merger Agreement") to extend the date for completion of the
merger with CDTI from 6 September 2010 to 15 October 2010.
Forbearance agreement with the secured convertible note holders
The holders of the Company's 8% secured convertible notes (the "Notes") agreed
to forbear from exercising any rights or remedies thereunder with respect to the
current event of default under the terms of the Notes to 15 October 2010. These
rights and remedies include: forgoing the increase in the interest rate from
8.0% to 15.0%, waiving the applicability of the additional payment premium of
two times (2x) the outstanding principal amount due, and agreeing that the
payment premium will be extinguished in the event that the Notes are converted
and the CDTI merger occurs prior to 15 October 2010. Accordingly, if the CDTI
merger has not occurred by 15 October 2010, and the Company is not able to
obtain the agreement of the holders of the Notes to waive, extend or further
modify the terms of the Notes, the interest rate will increase from 8.0% to
15.0% and an additional payment premium of two times (2x) the outstanding
principal amount will be due to the holders of the Notes.
The holders of the Notes further conditioned their obligation to purchase the
remaining $2.0 million of the Notes immediately prior to the closing of the CDTI
merger on the requirement that the Company and CDTI timely furnish the requested
statements regarding their estimated cash positions, that each of CSI and CDTI
have a certain minimum cash position, that the shares of CDTI to be issued in
the CDTI merger be approved for listing on the Nasdaq, in addition to the other
closing conditions in the Note purchase agreements (which include that the
Company must not have suffered any material adverse change).
As set out in the Company's announcements of 2 June 2010 and 14 May 2010, the
Notes provide the Company with financing for immediate working capital needs and
the $2.0 million cash balance required to ensure the minimum cash position
necessary at the effective time of the proposed merger with CDTI, to result in
the Company's shareholders receiving at least 60% of the shares of CDTI pursuant
to the terms of the merger.
Forbearance agreement with Fifth Third Bank
Fifth Third Bank, the Company's secured lender, has agreed to extend forbearance
under the terms of its loan to the Company until 15 October 2010. Under the
terms of the extension, the credit limit on the Company's revolving line of
credit has been reduced to a total of Canadian $6.0 million from Canadian $7.0
million. The interest rate on the line has increased to US/Canadian Prime Rate
plus 3.0 percent from 2.75 percent, with a further 1.0 percent increase
effective 15 October 2010 if the CDTI merger is not completed by 15 October
2010. Fifth Third Bank will extend the forbearance period for an additional
period of ninety days from the effective date of the CDTI merger if the CDTI
merger is completed by 15 October 2010 and, as of the effective date of the CDTI
merger, the Notes have been converted to common equity and the security granted
to the Note holders has been released; the Company and CDTI collectively have
$3.0 million of free cash on their balance sheet; the Company's Engine Control
Systems subsidiary has Canadian $2.0 million available under the existing loan
agreement; and no default, forbearance default or event of default (as defined
in the credit and forbearance agreements) is outstanding.
If the CDTI merger is not completed by 15 October 2010, an event of default will
be deemed to have occurred. In addition, if Fifth Third Bank determines that
the Company has suffered a material adverse change at any time, a default will
be deemed to have occurred under the forbearance agreement.
The entry into the foregoing forbearance agreements was conditioned upon the
amendment of the Merger Agreement to extend the date for completion of the CDTI
merger to 15 October 2010, as well as the entry into the forbearance agreement
by the other.
About Catalytic Solutions, Inc.
Catalytic Solutions, Inc. is a global manufacturer and distributor of emissions
control systems and products, focused in the heavy duty diesel and light duty
vehicle markets. CSI's emissions control systems and products are designed to
deliver high value to its customers while benefiting the global environment
through air quality improvement, sustainability and energy efficiency. Catalytic
Solutions, Inc. is listed on AIM of the London Stock Exchange (AIM: CTS and
CTSU) and currently has operations in the USA, Canada, France, Japan and Sweden
as well as an Asian joint venture.
For further details please contact:
+---------------------------+------------------+--------------------+
| Catalytic Solutions, Inc. | Canaccord | Buchanan |
| Charlie Call, Chief | Genuity Limited | Communications |
| Executive Officer | Robert Finlay | Charles Ryland |
| Tel: +1 (805) 639-9463 | Guy Blakeney | Christian Goodbody |
| Steve Golden, Chief | | |
| Technical Officer | | |
| Tel: +1 (805) 639-9464 | Tel: 020 7050 | Tel: 020 7466 5000 |
| Nikhil Mehta, Chief | 6500 | |
| Financial Officer | | |
| Tel: +1 (805) 639-9461 | | |
+---------------------------+------------------+--------------------+
A copy of this release is available on CSI's website at
www.catalyticsolutions.com.
This announcement and the information contained herein is restricted and is not
for publication, release or distribution in whole or in part in, or into, the
United States of America, Canada, Australia, The Republic of Ireland, Japan or
South Africa.
Canaccord Genuity Limited, which is authorised and regulated by the Financial
Services Authority, is not acting for any other person in connection with the
matters referred to in this announcement and will not be responsible to anyone
other than CSI for providing the protections afforded to clients of Canaccord
Genuity Limited or for giving advice in relation to the matters referred to in
this announcement.
In connection with the proposed merger with CDTI, CDTI has filed with the U.S.
Securities and Exchange Commission (SEC) a registration statement on Form S-4
that contains a preliminary prospectus and a joint proxy statement/information
statement, which registration statement has not been declared effective by the
SEC. The Circular to be provided to CSI's shareholders in connection with the
proposed merger with CDTI is included in the registration statement on Form
S-4, which was initially filed by CDTI with the SEC on 14 May 2010, as announced
by CSI on 17 May 2010. Amended registration statements were filed by CDTI with
the SEC on 22 July 2010 and 30 August 2010, as announced by CSI on 23 July 2010
and 31 August 2010, respectively. Investors and security holders of CDTI and
CSI are urged to read these materials as they become available because they will
contain important information about CDTI, CSI and the merger. The proxy
statement/information statement, prospectus and other relevant materials (when
they become available), and any other documents filed by CDTI with the SEC, may
be obtained free of charge at the SEC's web site at www.sec.gov. In addition,
investors and security holders may obtain free copies of the documents filed
with the SEC by CDTI by directing a written request to: Clean Diesel
Technologies, Inc., 10 Middle Street, Suite 1100, Bridgeport, CT 06604,
Attention: Investor Relations, or to Catalytic Solutions, Inc., 4567 Telephone
Road, Suite 206, Ventura, CA 93003, Attention: Investor Relations, and security
holders are urged to read the proxy statement/information statement, prospectus
and the other relevant materials when they become available before making any
voting or investment decision with respect to the merger.
This communication shall not constitute an offer to sell or the solicitation of
an offer to sell or the solicitation of an offer to buy any securities, nor
shall there be any sale of securities in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to registration or qualification
under the securities laws of any such jurisdiction. No offering of securities
shall be made in the United States except by means of a prospectus meeting the
requirements of the U.S. Securities Act of 1933, as amended, or pursuant to an
exemption from the registration requirements thereof.
This announcement and the information contained herein include forward-looking
statements relating to CSI and CDTI. Any statements that refer to expectations,
projections or other characterisations of future events or circumstances, in
particular, whether or not the merger with CDTI will occur, are forward-looking
statements. Such statements reflect the relevant company's current views with
respect to future events and are subject to risks, assumptions and uncertainties
that could cause the actual results to differ materially from those expressed or
implied in the forward-looking statements. Many of these risks, assumptions and
uncertainties relate to factors that are beyond the companies' abilities to
control or estimate precisely, such as whether or not CDTI's stockholders will
approve the issuance of the stock to CSI's shareholders in the merger, whether
or not CSI's shareholders will approve the merger and the necessary increase in
authorized share capital and designation of current shares of CSI stock as Class
A and approval of a new class of common stock to be designated Class B, and
whether or not CSI's shareholders will waive their pre-emptive rights in order
to permit conversion of the Notes, and whether or not the SEC will declare the
registration statement on Form S-4 effective, as well as other general risks
associated with the business of each of CSI and CDTI, which could affect the
completion of the merger, such as future market conditions, changes in general
economic and business conditions, introduction of competing products and
services, lack of acceptance of new products or services and the behaviour of
other market participants.
This announcement does not constitute a prospectus relating to CSI and has not
been approved by the UK Listing Authority, nor does it constitute or form any
part of any offer or invitation to purchase, sell or subscribe for, or any
solicitation of any such offer to purchase, sell or subscribe for, any
securities in CSI under any circumstances, and in any jurisdiction, in which
such offer or solicitation is unlawful.
The board directors of CSI accept responsibility for all the information
contained in this Announcement. To the best of the knowledge and belief of the
board directors of CSI (who have taken all reasonable care to ensure that such
is the case), the information contained in this document for which they are
responsible is in accordance with the facts and does not omit anything likely to
affect the import of such information.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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