XG Sciences, Inc., a leading supplier of graphene nanoplatelets and value-added products containing graphene nanoplatelets, announced that it has closed an agreement with The Dow Chemical Company (NYSE: DOW) for up to a $10 million senior credit facility, which may be drawn down in tranches by XGS at its discretion through December, 2019. For the first 2 years, interest on funds drawn under this facility may be accrued and added to principal at the Company’s request. The credit facility is secured by the assets of the Company, and XGS has agreed to issue warrants for 20% of amounts drawn under the facility. Such warrants will have a strike price equal to the last price per share at which the Company issued equity capital prior to any advances under the credit facility, which is currently $8.00 per share in the Company’s ongoing self-underwritten Initial Public Offering. The Company received $2 million under this facility at close and may draw another $3 million at its discretion at any time prior to the first anniversary of the agreement. After the first anniversary of the closing, the Company may access the remaining $5 million, provided it has raised at least $10 million of additional equity capital. XG Sciences and Dow agreed to hold commercial discussions including the potential out-license of certain of Dow’s manufacturing IP related to graphene nanoplatelets to XGS. Philip Rose, CEO of XG Sciences, stated, “We are pleased to work with Dow on this agreement. We believe this financing will allow us to continue building on our leadership position as a global supplier of graphene nanoplatelets. We have seven customers who are using our materials in their products and actively selling them to their customers or actively promoting them for future sales, and we expect that another 10-15 customers will begin to use our products commercially in 2017.”
