Dimethaid amends short-term loan agreement
TORONTO, Nov. 5 /CNW/ - Pharmaceutical developer Dimethaid Research Inc.
(TSX: DMX) has amended its short-term loan arrangement with Dr. F.W. Kuhne,
former principal of Oxo Chemie AG.
In September 2004, Dr. Kuhne agreed to provide Dimethaid with a
short-term loan of approximately $674,000. Dr. Kuhne has agreed to amend the
terms of this agreement to convert the loan into common shares of Dimethaid,
eliminating the possibility that Dimethaid will be required to repay the full
amount of the short-term loan in cash.
The loan further provides that if Dr. Kuhne elects to convert his loan to
common shares, and the value of the shares on the date of repayment is less
than the principal amount of the loan, Dimethaid will be required to pay the
differential amount in cash. Under the terms of the amendment, any cash
payments associated with the loan will not become due until January 2006, at
which time any such payments will be made in 12 equal monthly instalments.
Dimethaid has also received an offer of mortgage financing for its
Markham head office in the amount of $1,950,000 with interest at 8 3/4 percent
per annum and a two percent up front fee. The Company intends to use the
proceeds of this mortgage to discharge the current mortgage on the property.
The short-term loan cash amount has been subtracted from the current
obligations Dimethaid intended to satisfy with the net proceeds of the
proposed offering. Accordingly, Dimethaid now anticipates being able to use a
greater portion of the proceeds of the proposed offering for clinical trials
and general corporate purposes.
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