T2 Biosystems Announces Conversion of Approximately Twenty Percent of CRG Term Loan into Equity

Rhea-AI Summary

T2 Biosystems announces conversion of term loan into common stock and preferred stock, reducing outstanding principal amount by $10 million.

Positive

• The conversion of the term loan reduces the outstanding principal amount by $10 million.
• CRG is now a 19.99% beneficial owner of T2 Biosystems' outstanding common stock.
• Equitizing a portion of the term loan strengthens T2 Biosystems' balance sheet and provides additional optionality for growth and development initiatives.

Negative

• None.

LEXINGTON, Mass., July 06, 2023 (GLOBE NEWSWIRE) -- T2 Biosystems, Inc. (NASDAQ:TTOO), a leader in the rapid detection of sepsis-causing pathogens and antibiotic resistance genes, today announced the conversion of approximately 20% of its term loan with entities affiliated with CRG Servicing LLC (“CRG”) into T2 Biosystems common stock and Series B convertible preferred stock.

The conversion reduces the outstanding principal amount of the term loan by $10 million, or approximately 20%, in exchange for 48,345,798 shares of T2 Biosystems common stock and Series B Convertible Preferred Stock convertible into 93,297,259 shares of common stock, based on the June 30, 2023 close of business price of $0.0706 per share. The Series B Preferred shares will be eligible to be converted into common stock upon shareholder approval. The December 30, 2024 interest-only period end and maturity date of the term loan is unchanged. Following this transaction, CRG is now a 19.99% beneficial owner of T2 Biosystems’ outstanding common stock.

“We appreciate CRG’s continued support of T2 Biosystems as we develop and commercialize our products for the rapid detection of bacterial, fungal, and bioterrorism pathogens, as well as antibiotic resistance genes, directly-from-blood, without the need to wait days for a positive blood culture,” said John Sperzel, Chairman and CEO at T2 Biosystems. “Equitizing a portion of the term loan strengthens our balance sheet and provides additional optionality to capitalize the business to achieve our growth and development initiatives.”

About T2 Biosystems
T2 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 Statements
This 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 rapid, culture-independent diagnostics and the ability to demonstrate the value of the T2Bacteria Panel in rapidly identifying causative bacterial pathogens in septic patients, 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 Group
ir@T2Biosystems.com
415-937-5406

FAQ

What did T2 Biosystems announce?

T2 Biosystems announced the conversion of its term loan into common stock and preferred stock.

How much was the outstanding principal amount reduced by?

The outstanding principal amount was reduced by $10 million.

What percentage of T2 Biosystems' outstanding common stock does CRG now own?

CRG is now a 19.99% beneficial owner of T2 Biosystems' outstanding common stock.

What is the purpose of equitizing a portion of the term loan?

Equitizing a portion of the term loan strengthens T2 Biosystems' balance sheet and provides additional optionality for growth and development initiatives.