CTS Catalytic

 

TIDMCTS TIDMCTSU 
 
RNS Number : 4365E 
Catalytic Solutions, Inc. 
21 December 2009 
 

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| For Immediate Release               |                         21 December 2009 | 
+-------------------------------------+------------------------------------------+ 
 
 
 
 
Catalytic Solutions, Inc. 
 
 
(The "Company") 
 
 
UPDATE ON FINANCIAL POSITION 
RESTORATION TO TRADING 
 
 
 
Catalytic Solutions, Inc. (AIM: CTS and CTSU), the Company behind Mixed Phase 
Catalyst (MPC ) technology, announces the following: 
  *  Sale of Intellectual Property to joint venture partner TKK for $4.0 million 
  *  Agreement on terms of forbearance with secured lender 
 
 
 
TKK transaction 
The Board of Directors is pleased to announce that it has reached an agreement 
with Tanaka Kikinzoku Kogyo Kabushiki Kaisha ("TKK"), its joint venture partner 
in Asia Pacific, to sell the IP rights to part of its three-way catalyst ("TWC") 
technology to TKK. 
 
 
Under the terms of the Purchase & Sale Agreement (the "Agreement"), which has 
been approved by the Boards of the Company and TKK, Catalytic Solutions will 
sell certain patents relating to TWC technology to TKK for use in the Asia 
Pacific region only. The Agreement accelerates the exercise of the acquisition 
rights of TKK under the terms of the TC Catalyst Incorporated ("TCC") joint 
venture and requires that the respective equity ownership of TKK and Catalytic 
Solutions in the TCC joint venture changes to 95 per cent / 5 per cent in order 
to reflect the change in contributor of the TWC technology to the joint venture. 
The Agreement also provides Catalytic Solutions with a right of first refusal to 
reacquire the patents in the event that TKK chooses to dispose of them. Under 
the Agreement, the Company will receive total cash consideration of $4.0 million 
which is expected to be received in two tranches in December 2009 and the first 
quarter of 2010, respectively. 
 
 
Catalytic Solutions will continue to own rights to the utilization of the TWC 
technology in the remainder of the world, including the United States. In 
addition, TKK has agreed that it will not compete with the joint venture that it 
enjoys with the Company in the Asia Pacific region for the duration of the TCC 
joint venture, which has a minimum duration of 10 years. 
 
Forbearance agreement with Fifth Third Bank 
 Further to the Company's announcement of 27 November 2009, the Company and 
Fifth Third Bank have agreed to the terms under which Fifth Third Bank will 
extend forbearance until 31 January 2010 on the Company's outstanding debt 
obligations owed to it. The key terms include the repayment of approximately 
$900,000 to the bank by 31 December 2009, an increase in the interest rate 
payable by 100 basis points beginning 1 December 2009 and an additional 50 basis 
points beginning 1 January 2010. Other terms are customary for forbearance 
agreements of this nature. In addition, the bank has renewed the revolving 
facility through the term of forbearance. The facility was due for renewal on 31 
December 2009. 
 
 
The proceeds from the TKK transaction will be used in part to repay to Fifth 
Third Bank those amounts agreed to under the terms of forbearance. In addition, 
the proceeds will be used to fund the Company's operations while the Board seeks 
a longer term solution to the Company's liquidity position through discussions 
with other parties. While the board is working towards a successful conclusion 
to these discussions, there can be no guarantee of success. 
 
 
The Company's shares, which were suspended from trading on 30 September 2009, 
will recommence trading with effect from 7:30a.m. on 21 December 2009. 
 
 
For further details, please contact: 
 
 
+--------------------------------+----------------------+-------------------------+ 
| Catalytic Solutions, Inc.      | Canaccord Adams      | Buchanan Communications | 
| Charlie Call, Chief Executive  | Robert Finlay        | Charles Ryland          | 
| Officer                        | Guy Blakeney         | Ben Willey              | 
| Tel: +1 (805) 639-9463         | Kit Stephenson       | Christian Goodbody      | 
| Steve Golden, Chief Technical  | Tel: 020 7050 6500   | Tel: 020 7466 5000      | 
| Officer                        |                      |                         | 
| Tel: +1 (805) 639-9464         |                      |                         | 
| Nikhil Mehta, Chief Financial  |                      |                         | 
| Officer                        |                      |                         | 
| Tel: +1 (805) 639-9461         |                      |                         | 
+--------------------------------+----------------------+-------------------------+ 
 
 
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. The Company's emissions control systems and products are 
designed to deliver high value to our 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. 
 
 
The material set forth herein is for informational purposes only and is not 
intended, and should not be construed, as an offer of securities for sale into 
the United States or any other jurisdiction. The securities of the Company 
described herein have not been registered under the U.S. Securities Act of 1933, 
as Amended (the "Securities Act"), or the laws of any state, and may not be 
offered or sold within the United States, except pursuant to an exemption from, 
or in a transaction not subject to, the registration requirements of the 
Securities Act and applicable state laws. There is no present intention to 
register the Company's securities in the United States or to conduct a public 
offering of securities in the United States. 
 
 
 
This information is provided by RNS 
            The company news service from the London Stock Exchange 
   END 
 
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