T2 Biosystems Announces Agreement with CRG for the Conversion of $15 Million of CRG Term Loan into Equity
15 Febrero 2024 - 3:04PM
T2 Biosystems, Inc. (NASDAQ:TTOO), a leader in the rapid
detection of sepsis-causing pathogens and antibiotic resistance
genes, today announced the entrance into a definitive agreement to
convert $15 million of its term loan with entities affiliated with
CRG Servicing LLC (“CRG”) into T2 Biosystems equity upon
stockholder approval.
On February 15, 2024, T2 Biosystems entered into
a Securities Purchase Agreement with CRG to facilitate the debt
conversion. Pursuant to the terms of the Securities Purchase
Agreement, within 10 business days of receiving stockholder
approval of the transaction, CRG will cancel $15 million of
loans outstanding under the CRG Term Loan Agreement in exchange for
the issuance of an aggregate of $15 million of shares of common
stock at a price per share of the lower of (i) the average closing
price of our common stock on Nasdaq for the five consecutive
trading days immediately preceding the date of issuance and (ii)
the closing price of our common stock on Nasdaq on the trading day
immediately preceding the date of issuance; provided that in the
event this would result in CRG beneficially owning more than 49.99%
of the Company’s outstanding shares of common stock (or in the case
of one of the CRG entities, 9.99%, calculated without considering
convertible securities held by CRG), the Company will issue shares
of the newly designated Convertible Preferred Stock representing
the excess above 49.99% or 9.99%, as applicable. CRG agreed to
waive prepayment premiums and back-end fees associated
with such principal amounts of loans exchanged for equity.
“We appreciate CRG’s continued support of the
Company as we work to advance the business and regain compliance
with the Nasdaq listing requirements,” said John Sperzel, Chairman
and CEO at T2 Biosystems. “Equitizing another portion of the term
loan strengthens our balance sheet at a time when the company has a
number of important business catalysts ahead, including
international distribution expansion, two recent FDA 510(k)
clearances and one pending FDA 510(k) submission, and the
expectation for double-digit product revenue growth.”
This latest debt to equity conversion follows
two recent amendments to the CRG Term Loan Agreement. In July 2023,
CRG canceled $10.0 million of the Term Loan’s principal in exchange
for 483,457 shares of common stock and 93,297 shares of Series B
Convertible Preferred Stock (with each share of Series B
convertible into 10 shares of common stock). In October 2023, the
CRG Term Loan Agreement was amended to extend the interest-only
period and maturity date from December 30, 2024 to December 31,
2025 and to permanently reduce the minimum liquidity covenant from
$5 million to $500,000.
About T2 BiosystemsT2
Biosystems, a leader in the rapid detection of sepsis-causing
pathogens and antibiotic resistance genes, is dedicated to
improving patient care and reducing the cost of care by helping
clinicians effectively treat patients faster than ever before. T2
Biosystems’ products include the T2Dx® Instrument, the T2Bacteria®
Panel, the T2Candida® Panel, the T2Resistance® Panel, and the
T2SARS-CoV-2™ Panel and are powered by the proprietary T2 Magnetic
Resonance (T2MR®) technology. T2 Biosystems has an active pipeline
of future products, including the T2Biothreat™ Panel, the T2Cauris™
Panel, and T2Lyme™ Panel, as well as next-generation products for
the detection of bacterial and fungal pathogens and associated
antimicrobial resistance markers. For more information, please
visit www.t2biosystems.com.
Forward-Looking StatementsThis
press release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995.
All statements contained in this press release that do not relate
to matters of historical fact should be considered forward-looking
statements, including, without limitation, statements regarding
stockholder approval of the conversion of debt into shares of
common stock, the potential benefit of international distribution
expansion, recent FDA 510(k) clearances and the pending FDA 510(k)
submission, as well as the expectation for double-digit product
revenue growth, as well as statements that include the words
“expect,” “may,” “should,” “anticipate,” and similar statements of
a future or forward-looking nature. These forward-looking
statements are based on management’s current expectations. These
statements are neither promises nor guarantees, but involve known
and unknown risks, uncertainties and other important factors that
may cause actual results, performance or achievements to be
materially different from any future results, performance or
achievements expressed or implied by the forward-looking
statements, including, but not limited to, (i) any inability to (a)
realize anticipated benefits from commitments, contracts or
products; (b) successfully execute strategic priorities; (c) bring
products to market; (d) expand product usage or adoption; (e)
obtain customer testimonials; (f) accurately predict growth
assumptions; (g) realize anticipated revenues; (h) incur expected
levels of operating expenses; or (i) increase the number of
high-risk patients at customer facilities; (ii) failure of early
data to predict eventual outcomes; (iii) failure to make or obtain
anticipated FDA filings or clearances within expected time frames
or at all; or (iv) the factors discussed under Item 1A. “Risk
Factors” in the Company’s Annual Report on Form 10-K for the year
ended December 31, 2022, filed with the U.S. Securities and
Exchange Commission, or SEC, on March 31, 2023, and other filings
the Company makes with the SEC from time to time, including our
Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.
These and other important factors could cause actual results to
differ materially from those indicated by the forward-looking
statements made in this press release. Any such forward-looking
statements represent management’s estimates as of the date of this
press release. While the Company may elect to update such
forward-looking statements at some point in the future, unless
required by law, it disclaims any obligation to do so, even if
subsequent events cause its views to change. Thus, no one should
assume that the Company’s silence over time means that actual
events are bearing out as expressed or implied in such
forward-looking statements. These forward-looking statements should
not be relied upon as representing the Company’s views as of any
date subsequent to the date of this press release.
Investor Contact:Philip Trip Taylor, Gilmartin
Groupir@T2Biosystems.com 415-937-5406
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