Clean Diesel Technologies Inc. (CDTi), a leader in advanced emission control technology, has closed a new $2 million loan and amended its existing loan agreement with Kanis S.A. The amended agreement provides CDTi with mandatory conversion rights of the aggregate principal balance of $7.5 million into common stock of CDTi upon the occurrence of a liquidity event, such as a strategic investment in CDTi or public stock offering by CDTi.
“As a longtime investor in CDTi, Kanis, S.A. has demonstrated continued confidence in our advanced materials business strategy,” said Matthew Beale, CDTi’s CEO. “We believe these agreements provide us with an opportunity to significantly reduce the debt on our balance sheet and simplify our capital structure to support our path to profitability.”
The new $2 million loan bears an annual interest rate of 8 percent with a maturity date of Sept. 30, 2017. Terms of the loan require CDTi to apply funds received from a liquidity event in excess of $5 million toward the repayment of the loan. The amendment to the $7.5 million loan gives CDTi the right to convert the loan balance into common stock at a 25 percent discount to the price of a strategic investment or public stock offering.
