Filed Pursuant to Rule 424(b)(5)
Registration No. 333-206707
PROSPECTUS SUPPLEMENT
(to Prospectus dated September 22, 2015)
4,375,000 Shares
Common Stock
We are offering
4,375,000 shares of our common stock pursuant to this prospectus supplement and the accompanying prospectus. Our common stock is listed on The NASDAQ Global Market under the symbol “TTOO”. On September 15, 2017, the last reported sale
price of our common stock on The NASDAQ Global Market was $4.52 per share.
We are an emerging growth company as that term is used in the
Jumpstart Our Business Startups Act of 2012 and, as such, have elected to comply with certain reduced public company reporting requirements for this prospectus supplement and future filings.
Investing in our common stock involves a high degree of risk. Please read “
Risk Factors
” beginning
on page
S-5
of this prospectus supplement, on page 4 of the accompanying prospectus and in the documents incorporated by reference into this prospectus supplement.
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or
determined if this prospectus supplement or the accompanying prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
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Per Share
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Total
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Public Offering Price
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$
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4.00
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$
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17,500,000
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Underwriting Discounts and
Commissions
(1)
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$
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0.24
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$
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1,050,000
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Proceeds to T2 Biosystems, Inc., before expenses
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$
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3.76
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$
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16,450,000
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(1)
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See “Underwriting” for additional information relating to underwriting compensation.
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We have granted the underwriters an option for a period of 30 days to purchase up to an additional 656,250 shares of our common stock. If the
underwriters exercise the option in full, the total public offering price will be $20,125,000, the total underwriting discounts and commissions payable by us will be $1,207,500, and our total proceeds, before expenses, will be $18,917,500.
Delivery of the shares of common stock is expected to be made on or about September 19, 2017.
Joint Book-Running Managers
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Canaccord Genuity
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Cantor Fitzgerald & Co.
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Co-Managers
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Janney Montgomery Scott
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JonesTrading
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WBB Securities, LLC
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Prospectus Supplement dated September 15, 2017.
TABLE OF CONTENTS
You should rely only on the information contained or incorporated by reference in this prospectus supplement,
the accompanying prospectus and in any free writing prospectuses we have prepared in connection with this offering. Neither we nor any of the underwriters have authorized any other person to provide you with any information that is different. If
anyone provides you with different or inconsistent information, you should not rely on it. The information contained in this prospectus supplement, the accompanying prospectus and any accompanying free writing prospectus is accurate only as of the
date of this prospectus supplement, the accompanying prospectus and any such accompanying free writing prospectus, regardless of the time of delivery of this prospectus supplement, the accompanying prospectus, any such accompanying free writing
prospectus or of any sale of our common stock. Our business, financial condition, results of operations and prospects may have changed since those dates. We are offering to sell, and seeking offers to buy, shares of our common stock only in
jurisdictions where offers and sales are permitted. The distribution of this prospectus supplement and the offering of shares of our common stock in certain jurisdictions may be restricted by law. Persons outside the United States who come into
possession of this prospectus supplement must inform themselves about, and observe any restrictions relating to, the offering of shares of our common stock and the distribution of this prospectus supplement outside the United States. This prospectus
supplement does not constitute, and may not be used in connection with, an offer to sell, or a solicitation of an offer to buy, any securities offered by this prospectus supplement by any person in any jurisdiction in which it is unlawful for such
person to make such an offer or solicitation.
i
ABOUT THIS PROSPECTUS SUPPLEMENT
This document is part of a registration statement that we filed with the Securities and Exchange Commission, or the SEC, as an “emerging
growth company” as defined by the Jumpstart our Business Startups Act of 2012, using a “shelf” registration process and consists of two parts. The first part is this prospectus supplement, including the documents incorporated herein
by reference, which describes the specific terms of this offering. The second part is the accompanying prospectus, including the documents incorporated therein by reference, which provides more general information. Generally, when we refer only to
the “prospectus,” we are referring to both parts of this document combined. Before you invest, you should carefully read this prospectus supplement, the accompanying prospectus, all information incorporated by reference herein and therein,
as well as the additional information described under “Where You Can Find More Information” on
page S-23
of this prospectus supplement. These documents contain information you should consider
when making your investment decision. This prospectus supplement may add, update or change information contained in the accompanying prospectus. To the extent that any statement we make in this prospectus supplement is inconsistent with statements
made in the accompanying prospectus or any documents incorporated by reference, the statements made in this prospectus supplement will be deemed to modify or supersede those made in the accompanying prospectus and such documents incorporated by
reference.
Unless otherwise indicated, information contained in this prospectus supplement, the accompanying prospectus or the documents
incorporated by reference, concerning our industry and the markets in which we operate, including our general expectations and market position, market opportunity and market share, is based on information from our own management estimates and
research, as well as from industry and general publications, and research, surveys and studies conducted by third parties. Management estimates are derived from publicly available information, our knowledge of our industry and assumptions based on
such information and knowledge, which we believe to be reasonable. In addition, assumptions and estimates of our and our industry’s future performance are necessarily subject to a high degree of uncertainty and risk due to a variety of factors,
including those described in “Risk Factors” in this prospectus supplement, the accompanying prospectus and in our Annual Report on
Form 10-K
for the fiscal year ended December 31, 2016, as
updated by our subsequent filings under the Securities Exchange Act of 1934, as amended, or the Exchange Act. These and other important factors could cause our future performance to differ materially from our assumptions and estimates. See
“Special Note Regarding Forward-Looking Statements”.
T2 BIOSYSTEMS and our logo are two of our trademarks that are used in this
prospectus supplement, the accompanying prospectus and the documents incorporated by reference. This prospectus supplement, the accompanying prospectus and the documents incorporated by reference also include trademarks, tradenames and service marks
that are the property of others. Solely for convenience, trademarks and tradenames referred to in this prospectus supplement, the accompanying prospectus and the documents incorporated by reference appear without the
®
and ™ symbols, but those references are not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable law, our rights, or that the applicable owner
will not assert its rights, to these trademarks and tradenames.
Unless stated otherwise or the context otherwise indicates, all
references in this prospectus supplement or the accompanying prospectus to “T2 Biosystems,” “the Company,” “we,” “us” or “our” refer to T2 Biosystems, Inc., a Delaware corporation, and, where
applicable, our subsidiary.
S-1
PROSPECTUS SUPPLEMENT SUMMARY
This summary highlights selected information about us, this offering and information appearing elsewhere in this prospectus supplement, in the
accompanying prospectus and in the documents incorporated by reference into this prospectus supplement and the accompanying prospectus. This summary is not complete and does not contain all of the information you should consider before investing in
our common stock pursuant to this prospectus supplement and the accompanying prospectus. Before making an investment decision, to fully understand this offering and its consequences to you, you should carefully read this entire prospectus supplement
and the accompanying prospectus, including “Risk Factors” beginning on
page S-5
of this prospectus supplement, the financial statements and related notes, and the other information that we
incorporate by reference into this prospectus supplement, including the section “Risk Factors” in our Annual Report on
Form 10-K
for the fiscal year ended December 31, 2016, as updated by
our subsequent filings under the Exchange Act.
Our Company
We are an
in vitro
diagnostics company that has developed an innovative and proprietary technology platform that offers a rapid,
sensitive and simple alternative to existing diagnostic methodologies. We are using our T2 Magnetic Resonance technology, or T2MR, to develop a broad set of applications aimed at lowering mortality rates, improving patient outcomes and reducing the
cost of healthcare by helping medical professionals make targeted treatment decisions earlier. T2MR enables rapid detection of pathogens, biomarkers and other abnormalities in a variety of unpurified patient sample types, including whole blood,
plasma, serum, saliva, sputum and urine, and can detect cellular targets at limits of detection as low as one colony forming unit per milliliter. Our initial development efforts target sepsis and Lyme disease, which are areas of significant unmet
medical need in which existing therapies could be more effective with improved diagnostics. On September 22, 2014, we received market clearance from the U.S. Food and Drug Administration, or FDA, for our first two products, the T2Dx Instrument,
or the T2Dx, and the T2Candida Panel, or T2Candida, which have the ability to rapidly identify the five clinically relevant species of
Candida
, a fungal pathogen known to cause sepsis. In the United States, we have built a direct sales force
that is primarily targeting the top 450 hospitals with the highest concentration of patients at risk for
Candida
infections. In Europe, we have partnered with distributors that target large hospitals in their respective European markets.
Three additional diagnostic assays in development are called T2Bacteria, T2GNR, each of which is focused on bacterial sepsis, and T2Lyme, which is focused on Lyme disease.
Recent Developments
T2Bacteria received authorization to affix a CE mark in July 2017 and is being commercially launched in Europe and other countries that accept
the CE mark. A multi-site clinical study was completed in the United States in August 2017. On September 8, 2017, we filed a 510(k) premarket notification with the FDA requesting market clearance to enable commercial launch of T2Bacteria for
clinical use in the United States. T2Bacteria is currently available in the United States for research use only. We believe that we may receive a determination from the FDA on our application for T2Bacteria possibly as early as the end of 2017,
although it may take longer for the FDA to reach a decision and there can be no assurance of such a determination within this time frame or at all. We believe that T2Bacteria, if approved, may expand the number of high risk patients who could be
candidates for the T2Candida Panel and/or the T2Bacteria Panel and the number of hospitals in the United States targeted by our direct sales force to 1,200 hospitals.
On September 6, 2017, we announced that the Centers for Disease Control and Prevention (CDC) has agreed to utilize the T2Dx Instrument in
their laboratory for testing and monitoring the emergence and
S-2
outbreaks of the superbug
Candida auris
in hospitals around the country.
Candida auris
is a multi-drug resistant pathogen recognized by the CDC as a “serious global health
threat” because it can be resistant to “all three major classes of antifungal drugs” and difficult to identify. The CDC has also reported that more than one in three patients with
Candida auris
infections have died. Unlike most
other species of
Candida
,
Candida auris
can spread quickly in a hospital making rapid identification and hospital environment surveillance a critical component of containing these outbreaks. Existing laboratory methods that detect
Candida auris
, including blood culture, suffer from prolonged detection times and low accuracy, which exacerbates the challenge in the fight to contain the superbug. Recently, reported cases have surged internationally, and the CDC has
reported a significant increase in infected patients in the United States. According to the European Centre for Disease Prevention and Control, hospital outbreaks have occurred in the United Kingdom and Spain. Because
Candida auris
can be
resistant to most treatment options and can spread so quickly, these hospital outbreaks have been difficult to contain by even the most enhanced control measures. We are also conducting a study in Europe that has demonstrated the ability to detect
Candida auris
directly in patient blood specimens.
Corporate Information
We were incorporated under the laws of the State of Delaware in 2006. Our principal executive offices are located at 101 Hartwell Ave.,
Lexington, MA 02421 and our telephone number is
(781) 761-4646.
We are an “emerging
growth company,” as defined in the Jumpstart Our Business Startups Act of 2012. We will remain an emerging growth company until the earlier of (1) December 31, 2019, (2) the last day of the fiscal year in which we have total
annual gross revenue of at least $1.07 billion, (3) the date, as of the end of the fiscal year, on which we are deemed to be a large accelerated filer, which means the market value of our common stock held by
non-affiliates
was at least $700 million as of the last business day of the prior quarter ended June 30th, and (4) the date on which we have issued more than $1.0 billion in
non-convertible
debt during the prior three-year period.
S-3
THE OFFERING
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Common stock offered by us
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4,375,000 shares
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Option to purchase additional shares
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The underwriters have a
30-day
option to purchase up to additional 656,250 shares of common stock.
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Common stock to be outstanding immediately after this offering
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35,138,919 shares (or 35,795,169 shares if the underwriters exercise in full their option to purchase additional shares).
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Use of proceeds
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We intend to use the net proceeds of this offering to fund commercial efforts and research and development activities and for other general corporate and working capital purposes. Please see “Use of Proceeds” on
page S-9
of this prospectus supplement.
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Risk factors
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See “Risk Factors” beginning on
page S-5
of this prospectus supplement, and in the documents incorporated by reference into this prospectus supplement and the accompanying prospectus, for a
discussion of factors that you should read and consider before investing in our common stock.
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NASDAQ Global Market symbol
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“TTOO”
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The number of shares of our common stock to be outstanding after this offering is based on 30,763,919
shares of our common stock outstanding as of June 30, 2017, which does not include:
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4,006,148 shares of common stock issuable upon exercise of stock options outstanding as of June 30, 2017, at a weighted average exercise price of $7.67 per share;
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597,220 shares of common stock issuable upon settlement of restricted stock units outstanding as of June 30, 2017, at a weighted-average grant date fair value of $5.43 per share;
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528,958 shares of common stock issuable upon exercise of warrants outstanding as of June 30, 2017, at a weighted average exercise price of $8.06 per share;
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960,529 shares of common stock reserved for issuance under our 2014 Incentive Award Plan as of June 30, 2017, as well as any automatic increases in the number of shares of common stock reserved for future issuance
under this plan; and
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960,529 shares of common stock reserved for future issuance under our 2014 Employee Stock Purchase Plan as of June 30, 2017, as well as any automatic increases in the number of shares of common stock reserved for
future issuance under this plan.
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Unless otherwise indicated, this prospectus supplement reflects and assumes no exercise of
stock options or warrants outstanding as of June 30, 2017 and no exercise by the underwriters of their option to purchase additional shares of our common stock.
S-4
RISK FACTORS
Investing in our common stock involves a high degree of risk. Before investing in our common stock, you should consider carefully the risks
described below, together with the other information contained in this prospectus supplement, the accompanying prospectus and the documents incorporated by reference herein or therein, including the risks and uncertainties discussed under “Risk
Factors” in our Annual Report on
Form 10-K
for the fiscal year ended December 31, 2016, as updated by our subsequent filings under the Exchange Act. If any of the risks incorporated by reference
or set forth below occur, our business, financial condition, results of operations and future growth prospects could be materially and adversely affected. In these circumstances, the market price of our common stock could decline, and you may lose
all or part of your investment.
Risks Related to This Offering
Purchasers in this offering will experience immediate and substantial dilution in the book value of their investment.
The public offering price of our common stock is substantially higher than the net tangible book value per share of our common stock before
giving effect to this offering. Accordingly, if you purchase our common stock in this offering, you will incur immediate and substantial dilution of approximately $3.19 per share, representing the difference between the public offering price per
share of common stock and our as adjusted net tangible book value as of June 30, 2017. In addition, we may choose to raise additional capital due to market conditions or strategic considerations even if we believe we have sufficient funds for
our current or future operating plans. To the extent that additional capital is raised through the sale of equity or convertible debt securities, the issuance of these securities could result in further dilution to our stockholders or result in
downward pressure on the price of our common stock. For a further description of the dilution that you will experience immediately after this offering, see the section in this prospectus supplement entitled “Dilution”.
A substantial number of shares of common stock may be sold in the market following this offering, which may cause the market price of our common stock to
decline.
Sales of a substantial number of shares of our common stock in the public market following this offering, or the perception
in the market that the holders of a large number of shares intend to sell, could cause the market price of our common stock to decline. After this offering, we will have outstanding 35,138,919 shares of common stock based on the number of shares
outstanding as of June 30, 2017. This includes the shares that we are selling in this offering, which may be resold in the public market immediately without restriction, unless purchased by our affiliates or existing stockholders who have
signed
lock-up
agreements. Of the shares outstanding as of June 30, 2017, 10.8 million shares are subject to
lock-up
agreements with the underwriters for a period
of 90 days following the date of this prospectus supplement. The underwriters may, in their discretion, release the
lock-up
restrictions on any such shares at any time without notice.
Our directors and executive officers, together with their affiliates, have substantial influence over us and could delay or prevent a change in corporate
control.
Our directors and executive officers, together with their affiliates, beneficially own 10.8 million shares of our common
stock, or approximately 35%, based on the number of shares outstanding as of June 30, 2017, not reflecting any shares that may be purchased by them in this offering. These stockholders, acting together, have the ability to significantly
influence the outcome of matters submitted to our stockholders for approval, including the election of directors and any merger, consolidation or sale of all or substantially all of our assets. In addition, these stockholders, acting together, have
the ability to significantly influence the management and affairs of our company. Accordingly, this concentration of ownership might harm the market price of our common stock by:
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delaying, deferring or preventing a change in corporate control;
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S-5
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impeding a merger, consolidation, takeover or other business combination involving us; or
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discouraging a potential acquirer from making a tender offer or otherwise attempting to obtain control of us.
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We have broad discretion to determine how to use the funds raised in this offering, and may use them in ways that may not enhance our operating results or
the market price of our common stock.
Our management will have broad discretion over the use of proceeds from this offering, and we
could spend the proceeds from this offering in ways our stockholders may not agree with or that do not yield a favorable return, if at all. We intend to use the net proceeds from this offering to fund commercial efforts and research and development
activities and for other general corporate and working capital purposes. However, our use of these proceeds may differ substantially from our current plans. If we do not invest or apply the proceeds of this offering in ways that improve our
operating results, we may fail to achieve expected financial results, which could cause the market price of our common stock to decline.
S-6
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This prospectus supplement, the accompanying prospectus, the documents that we incorporate by reference and other written and oral statements
we make from time to time contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the Exchange Act. All statements other than statements of
historical facts contained in this prospectus supplement, the accompanying prospectus and in the documents incorporated by reference into this prospectus supplement and accompanying prospectus, including statements regarding the use of proceeds from
this offering, future results of operations and financial position, business strategy, prospective products and product candidates, their expected performance and impact on healthcare costs, regulatory clearance (including marketing clearance from
the FDA), expansion of hospitals and patients, reimbursement for our product candidates, research and development costs, timing of regulatory filings, timing and likelihood of success, plans and objectives of management for future operations and
future results of anticipated products are forward-looking statements. These statements are often, but are not always, made through the use of words or phrases such as “anticipate,” “believe,” “contemplate,”
“continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “seek,” “should,”
“target,” “will,” “would,” or the negative of these terms or other similar expressions. Accordingly, these statements involve estimates, assumptions and uncertainties which could cause actual results to differ
materially from those expressed in them. All forward-looking statements contained herein are expressly qualified in their entirety by this cautionary statement, the risk factors set forth under the heading “Risk Factors” and elsewhere in
this prospectus supplement, the accompanying prospectus and in the documents incorporated by reference into this prospectus supplement and the accompanying prospectus.
This prospectus supplement, the accompanying prospectus, the documents that we incorporate by reference and other written and oral statements
we make from time to time contain forward-looking statements that are based on our management’s belief and assumptions and on information currently available to our management. These statements relate to future events or our future
financial performance, and involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity,
performance or achievements expressed or implied by these forward-looking statements. These forward-looking statements are subject to numerous risks, including, without limitation, the following:
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our expectation to incur losses in the future;
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the market acceptance of our T2MR technology;
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our ability to timely and successfully develop and commercialize our existing products and future product candidates;
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the length of our anticipated sales cycle;
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our ability to gain the support of leading hospitals and key thought leaders and publish the results of our clinical trials in peer-reviewed journals;
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our ability to successfully manage our growth;
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our future capital needs and our need to raise additional funds;
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the performance of our diagnostics;
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our ability to compete in the highly competitive diagnostics market;
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our ability to obtain marketing clearance from the FDA or regulatory clearance for product candidates in the United States or any other jurisdiction;
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federal, state, and foreign regulatory requirements, including FDA regulation of our product candidates; and
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our ability to protect and enforce our intellectual property rights, including our trade secret-protected proprietary rights in T2MR.
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S-7
You should read this prospectus supplement, the accompanying prospectus and the documents
incorporated by reference into this prospectus supplement and accompanying prospectus completely with the understanding that our actual results may differ materially from what we expect as expressed or implied by our forward-looking statements. In
light of the significant risks and uncertainties to which our forward-looking statements are subject, you should not place undue reliance on or regard these statements as a representation or warranty by us or any other person that we will achieve
our objectives and plans in any specified timeframe, or at all. We discuss many of these risks in greater detail in the documents incorporated by reference, including under the heading “Risk Factors.” These forward-looking statements speak
only as of the date they were made. Except to the extent required by applicable laws and regulations, we undertake no obligation to update these forward-looking statements to reflect new information, events or circumstances after the date of such
statements or to reflect the occurrence of unanticipated events.
S-8
USE OF PROCEEDS
We estimate that the net proceeds from this offering, after deducting underwriting discounts and commissions and estimated offering expenses
payable by us, will be approximately $16.2 million (or approximately $18.6 million if the underwriters exercise in full their option to purchase 656,250 additional shares).
We intend to use the net proceeds of this offering to fund commercial efforts and research and development activities and for other general
corporate and working capital purposes. We believe that our cash, cash equivalents and short-term investments, together with the net proceeds from this offering, will fund our operations into the first half of 2019.
We have not determined the amounts we plan to spend in any of the areas identified above or the timing of these expenditures. As a result, our
management will have broad discretion to allocate the net proceeds to us from this offering, and investors will be relying on the judgment of our management regarding the application of the proceeds from this offering. We reserve the right to change
the use of these proceeds as a result of certain contingencies such as competitive developments, the results of our commercialization efforts, acquisition and investment opportunities and other factors.
Pending use of the proceeds as described above, we intend to invest the net proceeds of this offering in short-term, interest-bearing,
investment-grade securities or certificates of deposit.
S-9
DILUTION
If you invest in our common stock in this offering, your ownership interest will be immediately diluted to the extent of the difference
between the public offering price per share and the as adjusted net tangible book value per share of our common stock after this offering.
As of June 30, 2017, we had a net tangible book value of $12.3 million, or $0.40 per share of common stock. Our net tangible book
value per share represents total tangible assets less total liabilities, divided by the number of shares of common stock outstanding at June 30, 2017.
After giving effect to the issuance and sale by us of 4,375,000 shares of common stock in this offering at a public offering price of $4.00
per share, and after deducting the underwriting discounts and commissions and estimated offering expenses payable by us, our as adjusted net tangible book value as of June 30, 2017 would have been $28.5 million, or $0.81 per share. This amount
represents an immediate increase in net tangible book value of $0.41 per share to our existing stockholders and immediate dilution in as adjusted net tangible book value of $3.19 per share to new investors purchasing shares of common stock in this
offering.
Dilution per share to new investors is determined by subtracting as adjusted net tangible book value per share after this
offering from the public offering price per share paid by new investors. The following table illustrates this dilution on a per share basis:
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Public offering price per share
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$
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4.00
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Net tangible book value per share as of June 30, 2017
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$
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0.40
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Increase in as adjusted net tangible book value per share attributable to this offering
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$
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0.41
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As adjusted net tangible book value per share after this offering
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$
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0.81
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Dilution per share to new investors participating in this offering
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$
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3.19
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If the underwriters exercise in full their option to purchase 656,250 additional shares, our as adjusted net
tangible book value per share at June 30, 2017, after giving effect to this offering, would have been $0.86 per share, and the dilution in as adjusted net tangible book value per share to investors in this offering would have been $3.14 per
share, based on the public offering price of $4.00 per share.
The above discussion and table are based on 30,763,919 shares of our common
stock outstanding as of June 30, 2017, which do not include:
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4,006,148 shares of common stock issuable upon exercise of stock options outstanding as of June 30, 2017, at a weighted average exercise price of $7.67 per share;
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597,220 shares of common stock issuable upon settlement of restricted stock units outstanding as of June 30, 2017, at a weighted-average grant date fair value of $5.43 per share;
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528,958 shares of common stock issuable upon exercise of warrants outstanding as of June 30, 2017, at a weighted average exercise price of $8.06 per share;
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960,529 shares of common stock reserved for issuance under our 2014 Incentive Award Plan as of June 30, 2017, as well as any automatic increases in the number of shares of common stock reserved for future issuance
under this plan; and
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960,529 shares of common stock reserved for future issuance under our 2014 Employee Stock Purchase Plan as of June 30, 2017, as well as any automatic increases in the number of shares of common stock reserved for
future issuance under this plan.
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To the extent any of these outstanding stock options or warrants are exercised or
restricted stock units vest, new stock options or restricted stock units are issued under our 2014 Incentive Award Plan or we otherwise issue additional shares of common stock in the future at a price less than the public offering price, there will
be further dilution to new investors.
S-10
PRICE RANGE OF COMMON STOCK
Our common stock commenced trading on The NASDAQ Global Market under the symbol “TTOO” on August 7, 2014. Prior to our initial
public offering, there was no public market for our common stock. The following table sets forth, for the periods indicated, the high and low intraday sale prices of our common stock as reported by The NASDAQ Global Market.
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HIGH
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LOW
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Year ending December 31, 2017
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|
Third Quarter (through September 15, 2017)
|
|
$
|
6.99
|
|
|
$
|
2.50
|
|
|
Second Quarter
|
|
$
|
5.40
|
|
|
$
|
3.02
|
|
|
First Quarter
|
|
$
|
6.42
|
|
|
$
|
4.95
|
|
|
Year ended December 31, 2016
|
|
|
|
|
|
|
|
|
|
Fourth Quarter
|
|
$
|
4.46
|
|
|
$
|
4.89
|
|
|
Third Quarter
|
|
$
|
8.12
|
|
|
$
|
4.92
|
|
|
Second Quarter
|
|
$
|
11.30
|
|
|
$
|
7.65
|
|
|
First Quarter
|
|
$
|
11.20
|
|
|
$
|
7.45
|
|
|
Year ended December 31, 2015
|
|
|
|
|
|
|
|
|
|
Fourth Quarter
|
|
$
|
12.30
|
|
|
$
|
8.56
|
|
|
Third Quarter
|
|
$
|
17.27
|
|
|
$
|
8.45
|
|
|
Second Quarter
|
|
$
|
19.90
|
|
|
$
|
14.63
|
|
|
First Quarter
|
|
$
|
24.04
|
|
|
$
|
14.71
|
|
On September 15, 2017, the last reported sale price of our common stock on The NASDAQ Global Market was
$4.52 per share. As of September 13, 2017, there were 30,764,319 shares of our common stock outstanding held by 12 holders of record.
S-11
DIVIDEND POLICY
We have never declared or paid any cash dividends on our capital stock. We intend to retain future earnings, if any, to finance the operation
and expansion of our business, and we do not anticipate paying any cash dividends in the foreseeable future. In addition, the terms of our credit facilities limit our ability to pay cash dividends. Any future determination to pay dividends will be
at the discretion of our board of directors and will depend on a number of factors, including our results of operations, capital requirements, financial condition, future prospects, contractual arrangements, restrictions imposed by applicable law,
any limitations on payments of dividends present in our current and future debt arrangements and other factors the board of directors may deem relevant.
S-12
MATERIAL U.S. FEDERAL INCOME TAX CONSEQUENCES TO
NON-U.S.
HOLDERS
The following discussion is a summary of the material U.S. federal income tax
consequences to
non-U.S.
holders (as defined below) of the purchase, ownership and disposition of the shares of common stock issued pursuant to this offering, but does not purport to be a complete analysis of
all potential tax effects. The effects of other U.S. federal tax laws, such as estate and gift tax laws, and any applicable state, local or foreign tax laws are not discussed. This discussion is based on the Internal Revenue Code of 1986, as
amended, or the Code, Treasury Regulations promulgated thereunder, judicial decisions, and published rulings and administrative pronouncements of the U.S. Internal Revenue Service, or IRS, in effect as of the date of this offering. These authorities
may change or be subject to differing interpretations. Any such change or differing interpretation may be applied retroactively in a manner that could adversely affect a
non-U.S.
holder of our common stock.
This discussion also does not take into account or address changes to United States tax law that may result from tax reforms that may be enacted in 2017 or thereafter. We have not sought and will not seek any rulings from the IRS regarding the
matters discussed below. There can be no assurance the IRS or a court will not take a contrary position regarding the tax consequences of the purchase, ownership and disposition of our common stock.
This discussion is limited to
non-U.S.
holders that hold our common stock as a “capital
asset” within the meaning of Section 1221 of the Code (property held for investment). This discussion does not address all U.S. federal income tax consequences relevant to a
non-U.S.
holder’s
particular circumstances, including the impact of the alternative minimum tax or the unearned income Medicare contribution tax. In addition, it does not address consequences relevant to holders subject to particular rules, including, without
limitation:
|
|
•
|
|
U.S. expatriates and certain former citizens or long-term residents of the United States;
|
|
|
•
|
|
persons holding our common stock as part of a hedge, straddle or other risk reduction strategy or as part of a conversion transaction or other integrated investment;
|
|
|
•
|
|
banks, insurance companies, and other financial institutions;
|
|
|
•
|
|
brokers, dealers or traders in securities or currencies;
|
|
|
•
|
|
controlled foreign corporations,” “passive foreign investment companies,” and corporations that accumulate earnings to avoid U.S. federal income tax;
|
|
|
•
|
|
partnerships or other entities or arrangements treated as partnerships for U.S. federal income tax purposes (and investors therein);
|
|
|
•
|
|
tax-exempt
organizations or governmental organizations;
|
|
|
•
|
|
persons deemed to sell our common stock under the constructive sale provisions of the Code;
|
|
|
•
|
|
persons for whom our common stock constitutes “qualified small business stock” within the meaning of Section 1202 of the Code;
|
|
|
•
|
|
persons who hold or receive our common stock pursuant to the exercise of any employee stock option or otherwise as compensation; and
|
|
|
•
|
|
tax-qualified
retirement plans.
|
If a partnership (or
other entity treated as a partnership for U.S. federal income tax purposes) holds our common stock, the tax treatment of a partner in the partnership will depend on the status of the partner, the activities of the partnership and certain
determinations made at the partner level. Accordingly, partnerships holding our common stock and the partners in such partnerships should consult their tax advisors regarding the U.S. federal income tax consequences to them.
THIS DISCUSSION IS FOR INFORMATION PURPOSES ONLY AND IS NOT INTENDED AS LEGAL OR TAX ADVICE. INVESTORS SHOULD CONSULT THEIR TAX ADVISORS WITH
S-13
RESPECT TO THE APPLICATION OF THE U.S. FEDERAL INCOME TAX LAWS TO THEIR PARTICULAR SITUATIONS AS WELL AS ANY TAX CONSEQUENCES OF THE PURCHASE, OWNERSHIP AND DISPOSITION OF OUR COMMON STOCK
ARISING UNDER THE U.S. FEDERAL ESTATE OR GIFT TAX LAWS OR UNDER THE LAWS OF ANY STATE, LOCAL OR
NON-U.S.
TAXING JURISDICTION OR UNDER ANY APPLICABLE INCOME TAX TREATY.
Definition of a
Non-U.S.
Holder
For purposes of this discussion, a
“non-U.S.
holder” is any beneficial owner of our common
stock that is not a “U.S. person,” a partnership or an entity disregarded as separate from its owner, each for United States federal income tax purposes. A U.S. person is any person that, for U.S. federal income tax purposes, is:
|
|
•
|
|
an individual who is a citizen or resident of the United States;
|
|
|
•
|
|
a corporation (or other entity treated as a corporation for U.S. federal income tax purposes) created or organized under the laws of the United States, any state thereof, or the District of Columbia;
|
|
|
•
|
|
an estate, the income of which is subject to U.S. federal income tax regardless of its source; or
|
|
|
•
|
|
a trust that (1) is subject to the primary supervision of a U.S. court and the control of one or more United States persons (within the meaning of Section 7701(a)(30) of the Code), or (2) has made a valid
election under applicable Treasury Regulations to continue to be treated as a United States person.
|
Distributions
As described in the section entitled “Dividend Policy,” we do not anticipate declaring or paying dividends to holders of our common
stock in the foreseeable future. However, if we do make distributions on our common stock, such distributions of cash or property on our common stock will constitute dividends for U.S. federal income tax purposes to the extent paid from our current
or accumulated earnings and profits, as determined under U.S. federal income tax principles. Amounts not treated as dividends for U.S. federal income tax purposes will constitute a return of capital and first be applied against and reduce a
non-U.S.
holder’s adjusted tax basis in its common stock, but not below zero. Any excess will be treated as capital gain and will be treated as described below in the section relating to the sale or disposition
of our common stock. Because we may not know the extent to which a distribution is a dividend for U.S. federal income tax purposes at the time it is made, for purposes of the withholding rules discussed below we or the applicable withholding agent
may treat the entire distribution as a dividend.
Subject to the discussion below on backup withholding and foreign accounts, dividends
paid to a
non-U.S.
holder of our common stock that are not effectively connected with the
non-U.S.
holder’s conduct of a trade or business within the United States
will be subject to U.S. federal withholding tax at a rate of 30% of the gross amount of the dividends (or such lower rate specified by an applicable income tax treaty).
Non-U.S.
holders will be entitled to a reduction in or an exemption from withholding on dividends as a
result of either (a) an applicable income tax treaty or (b) the
non-U.S.
holder holding our common stock in connection with the conduct of a trade or business within the United States and dividends
being effectively connected with that trade or business. To claim such a reduction in or exemption from withholding, the
non-U.S.
holder must provide the applicable withholding agent with a properly executed
(a) IRS Form
W-8BEN
or
W-8BEN-E
(or other applicable documentation) claiming an exemption from or reduction of the
withholding tax under the benefit of an income tax treaty between the United States and the country in which the
non-U.S.
holder resides or is established, or (b) IRS Form
W-8ECI
stating that the dividends are not subject to withholding tax because they are effectively connected with the conduct by the
non-U.S.
holder of a trade or
business within the United States, as may be applicable. These certifications must be provided to the applicable withholding agent prior to the payment of dividends and must be updated periodically.
Non-U.S.
holders that do not timely provide the applicable withholding agent with the required certification, but that qualify for a reduced rate under an applicable income tax treaty, may obtain a refund of any excess amounts withheld by timely filing an
appropriate claim for refund with the IRS.
S-14
If dividends paid to a
non-U.S.
holder are effectively
connected with the
non-U.S.
holder’s conduct of a trade or business within the United States (and, if required by an applicable income tax treaty, the
non-U.S.
holder maintains a permanent establishment in the United States to which such dividends are attributable), then, although exempt from U.S. federal withholding tax (provided the
non-U.S.
holder provides
appropriate certification, as described above), the
non-U.S.
holder will be subject to U.S. federal income tax on such dividends on a net income basis at the regular graduated U.S. federal income tax rates. In
addition, a
non-U.S.
holder that is a corporation may be subject to a branch profits tax at a rate of 30% (or such lower rate specified by an applicable income tax treaty) on its effectively connected earnings
and profits for the taxable year that are attributable to such dividends, as adjusted for certain items.
Non-U.S.
holders should consult their tax advisors regarding their entitlement to benefits under any
applicable income tax treaty.
Sale or Other Disposition of Common Stock
Subject to the discussions below on backup withholding and foreign accounts, a
non-U.S.
holder will not
be subject to U.S. federal income tax on any gain realized upon the sale or other disposition of our common stock unless:
|
|
•
|
|
the gain is effectively connected with the
non-U.S.
holder’s conduct of a trade or business within the United States (and, if required by an applicable income tax treaty, the
non-U.S.
holder maintains a permanent establishment in the United States to which such gain is attributable);
|
|
|
•
|
|
the
non-U.S.
holder is a nonresident alien individual present in the United States for 183 days or more during the taxable year of the disposition and certain other requirements
are met; or
|
|
|
•
|
|
our common stock constitutes U.S. real property interests, or USRPIs, by reason of our status as a U.S. real property holding corporation, or USRPHC, for U.S. federal income tax purposes.
|
Gain described in the first bullet point above will generally be subject to U.S. federal income tax on a net income basis at the regular
graduated U.S. federal income tax rates. A
non-U.S.
holder that is a foreign corporation also may be subject to a branch profits tax at a rate of 30% (or such lower rate specified by an applicable income tax
treaty) on such effectively connected gain, as adjusted for certain items.
A
non-U.S.
holder
described in the second bullet point above will be subject to U.S. federal income tax at a rate of 30% (or such lower rate specified by an applicable income tax treaty) on any gain derived from the disposition, which may be offset by certain U.S.
source capital losses of the
non-U.S.
holder (even though the individual is not considered a resident of the United States) provided the
non-U.S.
holder has timely filed
U.S. federal income tax returns with respect to such losses.
With respect to the third bullet point above, we believe we are not
currently and do not anticipate becoming a USRPHC. Because the determination of whether we are a USRPHC depends on the fair market value of our USRPIs relative to the fair market value of our other business assets and our
non-U.S.
real property interests, however, there can be no assurance we are not a USRPHC or will not become one in the future. Even if we are or were to become a USRPHC, gain arising from the sale or other taxable
disposition by a
non-U.S.
holder of our common stock will not be subject to U.S. federal income tax if our common stock is “regularly traded,” as defined by applicable Treasury Regulations, on an
established securities market, and such
non-U.S.
holder owned, actually and constructively, 5% or less of our common stock throughout the shorter of the five-year period ending on the date of the sale or other
taxable disposition or the
non-U.S.
holder’s holding period. If we are a USRPHC and either our common stock is not regularly traded on an established securities market or a
non-U.S.
holder holds more than 5% of our outstanding common stock, directly or indirectly, during the applicable testing period, such
non-U.S.
holder’s gain on the
disposition of shares of our common stock generally will be taxed in the same manner as gain that is effectively connected with the conduct of a U.S. trade or business, except that the branch profits tax generally will not apply. If we are a USRPHC
and our common stock is not regularly traded on an established securities market, a
non-U.S.
holder’s proceeds received on the disposition of shares will also generally be subject to withholding at a rate
of 15%. Prospective investors are encouraged to consult their tax advisors regarding the possible consequences to them if we are, or were to become, a USRPHC.
S-15
Non-U.S.
holders should consult their tax advisors
regarding potentially applicable income tax treaties that may provide for different rules.
Information Reporting and Backup Withholding
Subject to the discussion below on foreign accounts, a
non-U.S.
holder will not be subject to backup
withholding with respect to distributions on our common stock we make to the
non-U.S.
holder, provided the applicable withholding agent does not have actual knowledge or reason to know such holder is a United
States person and the holder certifies its
non-U.S.
status, such as by providing a valid IRS Form
W-8BEN,
W-8BEN-E
or
W-8ECI,
or other applicable certification. However, information returns generally will be filed with the IRS in
connection with any distributions (including deemed distributions) made on our common stock to the
non-U.S.
holder, regardless of whether any tax was actually withheld. Copies of these information returns may
also be made available under the provisions of a specific treaty or agreement to the tax authorities of the country in which the
non-U.S.
holder resides or is established.
Information reporting and backup withholding may apply to the proceeds of a sale or other taxable disposition of our common stock within the
United States, and information reporting may (although backup withholding generally will not) apply to the proceeds of a sale or other taxable disposition of our common stock outside the United States conducted through certain U.S.-related financial
intermediaries, in each case, unless the beneficial owner certifies under penalty of perjury that it is a
non-U.S.
holder on IRS Form
W-8BEN
or
W-8BEN-E,
or other applicable form (and the payor does not have actual knowledge or reason to know that the beneficial owner is a U.S. person) or such owner otherwise
establishes an exemption. Proceeds of a disposition of our common stock conducted through a
non-U.S.
office of a
non-U.S.
broker generally will not be subject to backup
withholding or information reporting.
Backup withholding is not an additional tax. Any amounts withheld under the backup withholding
rules may be allowed as a refund or a credit against a
non-U.S.
holder’s U.S. federal income tax liability, provided the required information is timely furnished to the IRS.
Additional Withholding Tax on Payments Made to Foreign Accounts
Withholding taxes may be imposed under the Foreign Account Tax Compliance Act, or FATCA, on certain types of payments made to
non-U.S.
financial institutions and certain other
non-U.S.
entities. Specifically, a 30% withholding tax may be imposed on dividends (including deemed dividends) paid on our
common stock, or gross proceeds from the sale or other disposition of our common stock paid to a “foreign financial institution” or a
“non-financial
foreign entity” (each as defined in the
Code), unless (1) the foreign financial institution undertakes certain diligence and reporting obligations, (2) the
non-financial
foreign entity either certifies it does not have any
“substantial United States owners” (as defined in the Code) or furnishes identifying information regarding each substantial United States owner, or (3) the foreign financial institution or
non-financial
foreign entity otherwise qualifies for an exemption from these rules. If the payee is a foreign financial institution and is subject to the diligence and reporting requirements in (1) above,
it must enter into an agreement with the U.S. Department of the Treasury requiring, among other things, that it undertake to identify accounts held by certain “specified United States persons” or “United States-owned foreign
entities” (each as defined in the Code), annually report certain information about such accounts, and withhold 30% on certain payments to
non-compliant
foreign financial institutions and certain other
account holders. Foreign financial institutions located in jurisdictions that have an intergovernmental agreement with the United States governing FATCA may be subject to different rules.
Under the applicable Treasury Regulations and administrative guidance, withholding under FATCA generally applies to payments of dividends
(including deemed dividends) paid on our common stock, and will apply to payments of gross proceeds from the sale or other disposition of common stock on or after January 1, 2019. Because we may not know the extent to which a distribution is a
dividend for U.S. federal income tax purposes at the time it is made, for purposes of these withholding rules we or the applicable withholding agent may treat the entire distribution as a dividend. Prospective investors should consult their tax
advisors regarding the potential application of these withholding provisions.
S-16
UNDERWRITING
Under the terms and subject to the conditions to be set forth in an underwriting agreement by and between us and Canaccord Genuity Inc. and
Cantor Fitzgerald & Co., as representatives of the several underwriters named therein, we have agreed to sell to the underwriters and the underwriters have severally agreed to purchase from us, the number of shares indicated in the
following table:
|
|
|
|
|
|
|
Underwriter
|
|
Number of Shares
|
|
|
Canaccord Genuity Inc.
|
|
|
1,826,563
|
|
|
Cantor Fitzgerald & Co.
|
|
|
1,826,562
|
|
|
Janney Montgomery Scott LLC
|
|
|
350,000
|
|
|
JonesTrading Services LLC
|
|
|
262,500
|
|
|
WBB Securities, LLC
|
|
|
109,375
|
|
|
|
|
|
|
|
|
Total
|
|
|
4,375,000
|
|
|
|
|
|
|
|
The underwriting agreement provides that the obligations of the underwriters are subject to certain conditions
precedent such as the receipt by the underwriters of officers’ certificates and legal opinions. The underwriting agreement provides that the underwriters will purchase all of the shares if any of them are purchased. We have agreed to indemnify
the underwriters and certain of their controlling persons against certain liabilities, including liabilities under the Securities Act, and to contribute to payments that the underwriters may be required to make in respect of those liabilities.
The underwriters are offering the shares subject to their acceptance of the shares from us and subject to prior sale. The underwriters reserve
the right to withdraw, cancel or modify offers to the public and to reject orders in whole or in part.
Option to Purchase Additional Shares
We have granted the underwriters an option, exercisable no later than 30 calendar days after the date of the underwriting agreement, to
purchase up to an aggregate of 656,250 additional shares of our common stock at the public offering price, less the underwriting discounts and commissions set forth on the cover page of this prospectus supplement and as indicated below. We will be
obligated to sell these shares of our common stock to the underwriters to the extent the option is exercised.
Commission and Expenses
The underwriters have advised us that they propose to offer our common stock directly to the public at the offering price set forth on the
cover page of this prospectus supplement and to certain dealers at that price less a concession not in excess of $0.144 per share. After the offering, the public offering price and the concession to dealers may be reduced by the underwriters. No
such reduction will change the amount of proceeds to be received by us in the offering as set forth on the cover page of this prospectus supplement.
The following table shows the per share and total underwriting discounts and commissions that we will pay to the underwriters and the proceeds
we will receive before expenses. These amounts are shown assuming both no exercise and full exercise of the underwriters’ option to purchase additional shares of our common stock.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Per Share
|
|
|
Total Without
Option
Exercise
|
|
|
Total With
Option
Exercise
|
|
|
Public offering price
|
|
$
|
4.00
|
|
|
$
|
17,500,000
|
|
|
$
|
20,125,000
|
|
|
Underwriting discounts and commissions
|
|
$
|
0.24
|
|
|
$
|
1,050,000
|
|
|
$
|
1,207,500
|
|
|
Proceeds to T2 Biosystems, Inc., before expenses
|
|
$
|
3.76
|
|
|
$
|
16,450,000
|
|
|
$
|
18,917,500
|
|
S-17
We estimate the total offering expenses of this offering that will be payable by us, excluding
the underwriting discounts and commissions, will be approximately $280,000, which includes legal costs and various other fees.
In
addition to the underwriting discounts and commissions to be paid by us, we have agreed to reimburse the underwriters for up to $85,000 of certain of their
out-of-pocket
expenses incurred in connection with the offering.
No Sales of Similar Securities
We and our officers and directors have agreed with the underwriters, subject to certain exceptions, not to dispose of or hedge any of their
common stock or securities convertible into or exchangeable for shares of common stock during the period from the date of this prospectus supplement continuing through the date 90 days after the date of this prospectus supplement, except with the
prior written consent of Canaccord Genuity Inc. and Cantor Fitzgerald & Co., which may, in their sole discretion, release any of the securities subject to these agreements at any time.
Listing
Our common stock is traded on
The NASDAQ Global Market under the symbol “TTOO”.
Price Stabilization and Short Positions
In connection with the offering, the underwriters may purchase and sell our common stock in the open market. These transactions may include
over-allotment and stabilizing transactions, passive market making and purchases to cover syndicate short positions created in connection with the offering. Until distribution of the shares of our common stock is completed, SEC rules may limit the
underwriters from bidding for and purchasing shares of our common stock. However, the underwriters may engage in transactions that stabilize the price of the shares of our common stock, such as bids or purchases to peg, fix or maintain that price. A
“stabilizing transaction” is a bid for or the purchase of common stock on behalf of an underwriter in the open market for the purpose of fixing or maintaining the price of the shares of common stock. Stabilizing transactions may cause the
price of shares of our common stock to be higher than the price that might otherwise prevail in the open market.
If an underwriter
creates a short position in our common stock in connection with the offering (i.e., if it sells more shares of our common stock than are listed on the cover page of this prospectus supplement), the underwriter may reduce that short position by
purchasing shares of our common stock in the open market. A “covering transaction” is the bid for or purchase of common stock on behalf of an underwriter to reduce a short position incurred by the underwriter in connection with the
offering. The underwriters may also elect to reduce any short position by exercising all or part of the option described above. A short position is more likely to be created if an underwriter is concerned that there may be downward pressure on the
price of the shares in the open market after pricing that could adversely affect investors who purchase shares in this offering. Similar to other purchase transactions, an underwriter’s purchases to cover the short sales may have the effect of
raising or maintaining the market price of our shares or preventing or retarding a decline in the market price of our shares. As a result, the price of our shares may be higher than the price that might otherwise prevail in the open market.
An underwriter also may impose a penalty bid, whereby the underwriter may reclaim selling concessions allowed to syndicate members or other
broker-dealers in respect of the common stock sold in the offering for their account if the underwriter repurchases the shares in stabilizing or covering transactions. These activities may stabilize, maintain or otherwise affect the market price of
the common stock, which may be higher than the price that might otherwise prevail in the open market. The imposition of a penalty bid may also affect the price of the shares of our common stock in that it discourages resales of those shares of our
common stock.
S-18
In connection with this offering, the underwriters may also engage in passive market making
transactions in our common stock on The NASDAQ Global Market in accordance with Rule 103 of Regulation M during a period before the commencement of offers or sales of shares of our common stock in this offering and extending through the completion
of distribution. A passive market maker must display its bid at a price not in excess of the highest independent bid of that security. However, if all independent bids are lowered below the passive market maker’s bid, that bid must then be
lowered when specified purchase limits are exceeded.
Neither we nor the underwriters make any representation or prediction as to the
direction or magnitude of any effect that the transactions described above may have on the price of shares of our common stock. In addition, neither we nor the underwriters make any representation that the underwriters will engage in these
transactions or that these transactions, once commenced, will not be discontinued without notice.
Electronic Distribution
This prospectus supplement and the accompanying prospectus may be made available in electronic format on websites or through other online
services maintained by the underwriters of the offering, or by their affiliates. Other than this prospectus supplement and the accompanying prospectus in electronic format, the information on such websites and any information contained in any other
website maintained by the underwriters or any of their affiliates is not part of this prospectus supplement, the accompanying prospectus or the registration statement of which this prospectus supplement and the accompanying prospectus form a part,
has not been approved or endorsed by us or the underwriters in their capacities as underwriters and should not be relied upon by investors.
Affiliations
In the ordinary course of
business, the underwriters and their affiliates have, and in the future may, provide various investment banking, financial advisory and other services to us for which they have received, and may receive, customary compensation. In the course of
their business, the underwriters and their affiliates may actively trade our securities for their own account or for the accounts of customers, and, accordingly the underwriters and their affiliates may at any time hold long or short positions in
such securities.
Disclaimers About
Non-U.S.
Jurisdictions
United Kingdom
The underwriters:
|
|
•
|
|
have only communicated or caused to be communicated and will only communicate or cause to be communicated an invitation or inducement to engage in investment activity (within the meaning of section 21 of Financial
Services and Markets Act 2000 (as amended) (“FSMA”)) to persons who have professional experience in matters relating to investments falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order
2005 or in circumstances in which section 21 of FSMA does not apply to us; and
|
|
|
•
|
|
have complied with and will comply with all applicable provisions of FSMA with respect to anything done by it in relation to the securities in, from or otherwise involving the United Kingdom.
|
Switzerland
The securities will
not be offered, directly or indirectly, to the public in Switzerland and this prospectus does not constitute a public offering prospectus as that term is understood pursuant to article 652a or 1156 of the Swiss Federal Code of Obligations.
S-19
European Economic Area
In relation to each Member State of the European Economic Area (the “EEA”) which has implemented the Prospectus Directive (each, a
“Relevant Member State”), an offer of our shares may not be made to the public in a Relevant Member State other than:
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to any legal entity which is a qualified investor as defined in the Prospectus Directive;
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to fewer than 150 natural or legal persons (other than qualified investors as defined in the Prospectus Directive), subject to obtaining the prior consent of the relevant dealer or dealers nominated by us for any such
offer, or;
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in any other circumstances falling within Article 3(2) of the Prospectus Directive,
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provided that no such
offer of our shares shall require us or any underwriter to publish a prospectus pursuant to Article 3 of the Prospectus Directive or supplement prospectus pursuant to Article 16 of the Prospectus Directive.
For the purposes of this description, the expression an “offer of our shares to the public” in relation to any of our shares in any
Relevant Member State means the communication in any form and by any means of sufficient information on the terms of the offer and the shares to be offered so as to enable an investor to decide to purchase or subscribe for the shares, as the
expression may be varied in that Relevant Member State by any measure implementing the Prospectus Directive in that member state, and the expression “Prospectus Directive” means European Union Directive 2003/71/EC (as amended by Directive
2010/73/EU and includes any relevant implementing measure in each Relevant Member State.
Neither this prospectus supplement nor the
accompanying prospectus is a prospectus for the purposes of the Prospectus Directive. This prospectus supplement and the accompanying prospectus have been prepared on the basis that any offer of our shares in any Relevant Member State will be made
pursuant to an exemption under the Prospectus Directive from the requirement to publish a prospectus for offers of shares. We have not authorized and do not authorize the making of any offer of securities through any financial intermediary on our
behalf, other than offers made by the underwriters and their respective affiliates, with a view to the final placement of the securities as contemplated in this document. Accordingly, no purchaser of the shares, other than the underwriters, is
authorized to make any further offer of shares on our behalf or on behalf of the underwriters.
Canada
The securities may be sold only to purchasers purchasing, or deemed to be purchasing, as principal that are accredited investors, as defined in
National Instrument
45-106
Prospectus Exemptions or subsection 73.3(1) of the Securities Act (Ontario), and are permitted clients, as defined in National Instrument
31-103
Registration Requirements, Exemptions and Ongoing Registrant Obligations. Any resale of the securities must be made in accordance with an exemption from, or in a transaction not subject to, the
prospectus requirements of applicable securities laws.
Securities legislation in certain provinces or territories of Canada may provide a
purchaser with remedies for rescission or damages if the prospectus supplement or the prospectus (including any amendment thereto) contains a misrepresentation, provided that the remedies for rescission or damages are exercised by the purchaser
within the time limit prescribed by the securities legislation of the purchaser’s province or territory. The purchaser should refer to any applicable provisions of the securities legislation of the purchaser’s province or territory for
particulars of these rights or consult with a legal advisor.
Pursuant to section 3A.3 (or, in the case of securities issued or guaranteed
by the government of a
non-Canadian
jurisdiction, section 3A.4) of National Instrument
33-105
Underwriting Conflicts (NI
33-105),
the underwriters are not required to comply with the disclosure requirements of NI
33-105
regarding underwriter conflicts of interest in connection with this offering.
S-20
LEGAL MATTERS
The validity of the shares of common stock offered hereby will be passed upon for us by Latham & Watkins LLP, Boston,
Massachusetts. Cooley LLP, New York, New York is counsel to the underwriters in connection with this offering.
S-21
EXPERTS
Ernst & Young LLP, independent registered public accounting firm, has audited our consolidated financial statements included in
our Annual Report on
Form 10-K
for the year ended December 31, 2016, as set forth in their report, which is incorporated by reference in this prospectus and elsewhere in the registration statement.
Our financial statements are incorporated by reference in reliance on Ernst & Young LLP’s report, given on their authority as experts in accounting and auditing.
S-22
WHERE YOU CAN FIND MORE INFORMATION
Available Information
We file annual,
quarterly and current reports, proxy statements and other information with the SEC. Information filed with the SEC by us can be inspected and copied at the Public Reference Room maintained by the SEC at 100 F Street, N.E., Washington, D.C.
20549. You may also obtain copies of this information by mail from the Public Reference Section of the SEC at prescribed rates. Further information on the operation of the SEC’s Public Reference Room in Washington, D.C. can be obtained by
calling the SEC at
1-800-SEC-0330.
The SEC also maintains a website that contains reports, proxy and information statements, and
other information about issuers, such as us, who file electronically with the SEC. The address of that website is
http://www.sec.gov
.
Our website address is
www.t2biosystems.com
. The information contained in, or accessible through, our website, however, should not be
considered a part of this prospectus supplement or the accompanying prospectus. Our common stock is quoted on The NASDAQ Global Market under the symbol “TTOO.”
This prospectus supplement and the accompanying prospectus are part of a registration statement that we filed with the SEC and do not contain
all of the information in the registration statement. The full registration statement may be obtained from the SEC or us, as provided below. Other documents establishing the terms of the offered securities are or may be filed as exhibits to the
registration statement. Statements in this prospectus supplement or the accompanying prospectus about these documents are summaries, and each such statement is qualified in all respects by reference to the document to which it refers. You should
refer to the actual documents for a more complete description of the relevant matters. You may inspect a copy of the registration statement at the SEC’s Public Reference Room in Washington, D.C. or through the SEC’s website, as provided
above.
Incorporation by Reference
The SEC’s rules allow us to “incorporate by reference” information into this prospectus supplement and the accompanying
prospectus, which means that we can disclose important information to you by referring you to another document filed separately with the SEC. The SEC file number for the documents incorporated by reference in this prospectus supplement and the
accompanying prospectus is
001-36571.
The information incorporated by reference is deemed to be part of this prospectus supplement and the accompanying prospectus, and subsequent information that we file with
the SEC will automatically update and supersede that information. Any statement contained in a previously filed document incorporated by reference will be deemed to be modified or superseded for purposes of this prospectus supplement and the
accompanying prospectus to the extent that a statement contained in this prospectus supplement or the accompanying prospectus modifies or replaces that statement.
This prospectus supplement incorporates by reference the documents set forth below that have previously been filed with the SEC:
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our Annual Report on
Form 10-K
for the year ended December 31, 2016, filed with the SEC on March 15, 2017;
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our Quarterly Reports on
Form 10-Q
filed with the SEC for the periods ended March 31, 2017 and June 30, 2017 filed with the SEC on May 8, 2017 and
August 4, 2017, respectively;
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the information specifically incorporated by reference from our Definitive Proxy Statement on Schedule 14A (other than information furnished rather than filed), filed with the SEC on April 21, 2017;
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our Current Reports on
Form 8-K
filed with the SEC on January 6, 2017, January 20, 2017, March 3, 2017, March 8, 2017, May 4, 2017, June 6,
2017, September 5, 2017, September 11, 2017 and September 14, 2017; and
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S-23
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the description of our common stock contained in our registration statement on
Form 8-A,
which was filed with the SEC on July 25, 2014, including any amendment or report
filed with the SEC for the purpose of updating such description.
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We incorporate by reference into this prospectus
supplement and accompanying prospectus all reports and other documents we subsequently file with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act between the date of this prospectus supplement and the termination of
the offering of the securities described in this prospectus supplement, including all such documents we may file with the SEC after the date of the initial registration statement and prior to the effectiveness of the registration statement. We are
not, however, incorporating by reference any documents or portions thereof, whether specifically listed above or filed in the future, that are not deemed “filed” with the SEC, including any information furnished pursuant to Items 2.02
or 7.01 of
Form 8-K
or related exhibits furnished pursuant to Item 9.01 of
Form 8-K.
The reports and documents specifically listed above or filed in the
future (excluding any information furnished to, rather than filed with, the SEC) are deemed to be part of this prospectus supplement and accompanying prospectus from the date of the filing of such reports and documents.
You may request a free copy of any of the documents incorporated by reference into this prospectus supplement or the accompanying prospectus
(other than exhibits, unless they are specifically incorporated by reference into this prospectus supplement or the accompanying prospectus) by writing or telephoning us at the following address:
T2 Biosystems, Inc.
101 Hartwell Ave.
Lexington, MA 02421
(781) 761-4646
Attention: General Counsel
S-24
PROSPECTUS
$100,000,000
Common Stock
Preferred Stock
Debt Securities
Warrants
Units
$43,000,000
Common Stock
Offered by the Selling Securityholders
We may offer
and sell up to $100,000,000 in the aggregate of the securities identified above, and the selling securityholders may offer and sell up to $43,000,000 in the aggregate of common stock identified above, in each case from time to time in one or more
offerings. This prospectus provides you with a general description of the securities. We will not receive any proceeds from the sale of our common stock by the selling securityholders.
Each time we or any of the selling securityholders offer and sell securities, we or such selling securityholders will provide a supplement to
this prospectus that contains specific information about the offering and, if applicable, the selling securityholders, as well as the amounts, prices and terms of the securities. The supplement may also add, update or change information contained in
this prospectus with respect to that offering. You should carefully read this prospectus and the applicable prospectus supplement before you invest in any of our securities.
We may offer and sell the securities described in this prospectus and any prospectus supplement to or through one or more underwriters,
dealers and agents, or directly to purchasers, or through a combination of these methods. In addition, the selling securityholders may offer and sell shares of our common stock from time to time, together or separately. If any underwriters, dealers
or agents are involved in the sale of any of the securities, their names and any applicable purchase price, fee, commission or discount arrangement between or among them will be set forth, or will be calculable from the information set forth, in the
applicable prospectus supplement. See the sections of this prospectus entitled “About this Prospectus” and “Plan of Distribution” for more information. No securities may be sold without delivery of this prospectus and the
applicable prospectus supplement describing the method and terms of the offering of such securities.
Investing in our securities
involves risks. See the “
Risk Factors
” on page 4 of this prospectus and any similar section contained in the applicable prospectus supplement concerning factors you should consider
before investing in our securities.
Our common stock is listed on The NASDAQ Global Market under the symbol “TTOO.” On
September 15, 2015, the last reported sale price of our common stock on The NASDAQ Global Market was $12.10 per share.
Neither
the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense.
The date of this prospectus is September 22, 2015.
TABLE OF CONTENTS
i
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement that we filed with the U.S. Securities and Exchange Commission, or the SEC, using a
“shelf” registration process. By using a shelf registration statement, we may sell securities from time to time and in one or more offerings up to a total dollar amount of $100,000,000 and the selling securityholders to be named in a
supplement to this prospectus may sell up to $43,000,000 in the aggregate of common stock from time to time in one or more offerings as described in this prospectus. Each time that we or the selling securityholders offer and sell securities, we or
the selling securityholders will provide a prospectus supplement to this prospectus that contains specific information about the securities being offered and sold and the specific terms of that offering. The prospectus supplement may also add,
update or change information contained in this prospectus with respect to that offering. If there is any inconsistency between the information in this prospectus and the applicable prospectus supplement, you should rely on the prospectus supplement.
Before purchasing any securities, you should carefully read both this prospectus and the applicable prospectus supplement, together with the additional information described under the heading “Where You Can Find More Information.”
Neither we, nor the selling securityholders, have authorized any other person to provide you with different information. If anyone provides
you with different or inconsistent information, you should not rely on it. We and the selling securityholders will not make an offer to sell these securities in any jurisdiction where the offer or sale is not permitted. You should assume that the
information appearing in this prospectus and the applicable prospectus supplement to this prospectus is accurate as of the date on its respective cover, and that any information incorporated by reference is accurate only as of the date of the
document incorporated by reference, unless we indicate otherwise. Our business, financial condition, results of operations and prospects may have changed since those dates.
This prospectus incorporates by reference, and any prospectus supplement or free writing prospectus may contain and incorporate by reference,
industry, statistical and market data from our own internal estimates and research as well as from industry and general publications and research, surveys and studies conducted by third parties. Industry publications, studies and surveys generally
state that they have been obtained from sources believed to be reliable, although they do not guarantee the accuracy or completeness of such information. While we believe that each of these studies and publications is reliable, we have not
independently verified statistical, market and industry data from third-party sources. While we believe our internal company research is reliable and the market definitions are appropriate, neither such research nor these definitions have been
verified by any independent source.
Unless the context otherwise indicates, references in this prospectus to “T2 Biosystems”,
“we”, “our”, “us” and “the Company” refer, collectively, to T2 Biosystems, Inc., a Delaware corporation. When we refer to “you,” we mean the holders of the applicable series of securities.
1
WHERE YOU CAN FIND MORE INFORMATION
Available Information
We file annual, quarterly and current reports, proxy statements and other information with the SEC. Information filed with the SEC by us can
be inspected and copied at the Public Reference Room maintained by the SEC at 100 F Street, N.E., Washington, D.C. 20549. You may also obtain copies of this information by mail from the Public Reference Room of the SEC at prescribed rates.
Further information on the operation of the SEC’s Public Reference Room in Washington, D.C. can be obtained by calling the SEC at
1-800-SEC-0330.
The SEC also maintains a web site that contains reports, proxy and information statements and other information
about issuers, such as us, who file electronically with the SEC. The address of that website is
http://www.sec.gov
.
Our web site
address is
www.t2biosystems.com
. The information on our web site, however, is not, and should not be deemed to be, a part of this prospectus.
This prospectus and any prospectus supplement are part of a registration statement that we filed with the SEC and do not contain all of the
information in the registration statement. The full registration statement may be obtained from the SEC or us, as provided below. Forms of the indenture and other documents establishing the terms of the offered securities are or may be filed as
exhibits to the registration statement. Statements in this prospectus or any prospectus supplement about these documents are summaries and each statement is qualified in all respects by reference to the document to which it refers. You should refer
to the actual documents for a more complete description of the relevant matters. You may inspect a copy of the registration statement at the SEC’s Public Reference Room in Washington, D.C. or through the SEC’s website, as provided above.
Incorporation by Reference
The SEC’s rules allow us to “incorporate by reference” information into this prospectus, which means that we can disclose
important information to you by referring you to another document filed separately with the SEC. The information incorporated by reference is deemed to be part of this prospectus, and subsequent information that we file with the SEC will
automatically update and supersede that information. Any statement contained in a previously filed document incorporated by reference will be deemed to be modified or superseded for purposes of this prospectus to the extent that a statement
contained in this prospectus modifies or replaces that statement.
We incorporate by reference our documents listed below and any future
filings made by us with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934, as amended, which we refer to as the “Exchange Act” in this prospectus, between the date of this prospectus and the
termination of the offering of the securities described in this prospectus. We are not, however, incorporating by reference any documents or portions thereof, whether specifically listed below or filed in the future, that are not deemed
“filed” with the SEC, including our Compensation Committee report and performance graph or any information furnished pursuant to Items 2.02 or 7.01 of
Form 8-K
or related exhibits furnished
pursuant to Item 9.01 of
Form 8-K.
This prospectus and any accompanying prospectus
supplement incorporate by reference the documents set forth below that have previously been filed with the SEC:
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our Annual Report on
Form 10-K
for the year ended December 31, 2014, filed with the SEC on March 4, 2015;
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our Quarterly Reports on
Form 10-Q
filed with the SEC for the quarters ended March 31, 2015 and June 30, 2015, filed with the SEC on May 6, 2015 and
August 5, 2015, respectively (the “Quarterly Reports”);
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our Definitive Proxy Statement on Schedule 14A, filed with the SEC on April 30, 2015;
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our Current Reports on
Form 8-K
and Amended Current Reports on
Form 8-K/A
filed with the SEC on January 21, 2015,
February 4, 2015, May 29, 2015, June 22, 2015 and August 7, 2015; and
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the description of our common stock contained in our registration statement on
Form 8-A,
which was filed with the SEC on July 25, 2014, including any amendment or report
filed with the SEC for the purpose of updating such description.
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All reports and other documents we subsequently file
pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act prior to the termination of this offering, including all such documents we may file with the SEC after the date of the initial registration statement and prior to the
effectiveness of the registration statement, but excluding any information furnished to, rather than filed with, the SEC, will also be incorporated by reference into this prospectus and deemed to be part of this prospectus from the date of the
filing of such reports and documents.
You may request a free copy of any of the documents incorporated by reference in this prospectus
(other than exhibits, unless they are specifically incorporated by reference in the documents) by writing or telephoning us at the following address:
T2 Biosystems, Inc., 101 Hartwell Avenue, Lexington, MA 02421, Attention: Secretary, or by telephone request to (781)
761-4646.
Exhibits to the filings will not be sent, however, unless those exhibits have specifically
been incorporated by reference in this prospectus and any accompanying prospectus supplement.
3
RISK FACTORS
Investment in any securities offered pursuant to this prospectus and the applicable prospectus supplement involves risks. You should carefully
consider the risk factors incorporated by reference to our most recent Annual Report on
Form 10-K
and any subsequent Quarterly Reports on
Form 10-Q
or Current
Reports on
Form 8-K
we file after the date of this prospectus, and all other information contained or incorporated by reference into this prospectus, as updated by our subsequent filings under the
Exchange Act, and the risk factors and other information contained in the applicable prospectus supplement before acquiring any of such securities. The occurrence of any of these risks might cause you to lose all or part of your investment in the
offered securities.
4
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
This prospectus, including the documents that we incorporate by reference, contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements other than statements of historical
facts contained in this prospectus, including statements regarding our future results of operations and financial position, business strategy, prospective products and product candidates, their expected performance and impact on healthcare costs,
marketing authorization from the U.S. Food and Drug Administration, or FDA, regulatory clearance, reimbursement for our product candidates, research and development costs, timing of regulatory filings, timing and likelihood of success, plans and
objectives of management for future operations and future results of anticipated products, are forward-looking statements. These statements are often, but are not always, made through the use of words or phrases such as “anticipate,”
“believe,” “contemplate,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project,”
“seek,” “should,” “target,” “will,” “would,” or the negative of these terms or other similar expressions. Accordingly, these statements involve estimates, assumptions and uncertainties which could
cause actual results to differ materially from those expressed in them. Any forward-looking statements are qualified in their entirety by reference to the factors discussed throughout this report, and in particular those factors referenced in the
section “Risk Factors.”
This prospectus contains forward-looking statements that are based on our management’s belief and
assumptions and on information currently available to our management. These statements relate to future events or our future financial performance, and involve known and unknown risks, uncertainties and other factors that may cause our actual
results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. These forward-looking statements
are subject to numerous risks, including, without limitation, the following:
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our expectation to incur losses in the future;
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our ability to obtain marketing authorization from the FDA or regulatory clearance for new product candidates in the United States or any other jurisdiction;
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the market acceptance of our T2MR technology;
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our ability to timely and successfully develop and commercialize our existing products and future product candidates;
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our future capital needs and our need to raise additional funds;
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the length of our anticipated sales cycle;
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our ability to gain the support of leading hospitals and key thought leaders and publish the results of our clinical trials in peer-reviewed journals;
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the performance of our diagnostics;
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our ability to compete in the highly competitive diagnostics market;
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our ability to protect and enforce our intellectual property rights, including our trade secret-protected proprietary rights in T2MR;
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our ability to successfully manage our growth; and
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federal, state, and foreign regulatory requirements, including FDA regulation of our product candidates.
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5
THE COMPANY
We are an
in vitro
diagnostics company that has developed an innovative and proprietary technology platform that offers a rapid,
sensitive and simple alternative to existing diagnostic methodologies. We are using our T2 Magnetic Resonance platform, or T2MR, to develop a broad set of applications aimed at lowering mortality rates, improving patient outcomes and reducing the
cost of healthcare by helping medical professionals make targeted treatment decisions earlier. Our initial development efforts utilizing T2MR target sepsis and hemostasis, which are areas of significant unmet medical need where existing therapies
could be more effective with improved diagnostics. On September 22, 2014, we received market authorization from the FDA for our first two products, the T2Dx Instrument, or T2DX and the T2Candida Panel or T2Candida, for the direct detection of
Candida
species in human whole blood specimens and independent of blood culture from patients with symptoms of, or medical conditions predisposing the patient to, invasive fungal infections. We have launched the commercialization of the T2Dx
and T2Candida in the United States and we are building a direct sales force that is targeting the top 450 hospitals in the United States that have the highest concentration of patients at risk for
Candida
infections. Our next three diagnostic
applications are called T2Bacteria, T2HemoStat, and T2Lyme, which are focused on bacterial sepsis infections, hemostasis, and Lyme disease, respectively. We plan to initiate clinical trials in the first part of 2016 for T2Bacteria and in 2016 for
T2HemoStat. We expect that existing reimbursement codes will support our T2Bacteria and T2HemoStat product candidates, and that the anticipated economic savings associated with T2Bacteria and T2Candida will be realized directly by hospitals. We
believe our combined initial annual addressable market opportunity for sepsis, hemostasis and Lyme disease is over $3.7 billion in the United States alone, when the market opportunity for T2Candida, T2Bacteria, T2Lyme and our initial hemostasis
diagnostic panel is combined.
We own various U.S. federal trademark registrations and applications, and unregistered trademarks and
service marks, including T2 Biosystems
®
, T2MR
®
, T2Dx
®
, T2Candida
®
, T2Bacteria™, T2Hemostat™ and T2Lyme™.
We were incorporated under
the laws of the State of Delaware in 2006. Our principal executive offices are located at 101 Hartwell Ave., Lexington, MA 02421 and our telephone number is
(781) 761-4646.
We are an “emerging growth company,” as defined in the Jumpstart Our Business Startups Act of 2012. We will remain an emerging
growth company until the earlier of (1) the last day of the fiscal year following the fifth anniversary of the completion of our initial public offering of common stock on August 12, 2014, (2) the last day of the fiscal year in which
we have total annual gross revenue of at least $1.0 billion, (3) the last day of the fiscal year in which we are deemed to be a large accelerated filer, which means the market value of our common stock that is held by
non-affiliates
exceeds $700 million as of the prior June 30th, and (4) the date on which we have issued more than $1.0 billion in
non-convertible
debt
during the prior three-year period.
6
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth, for each of the periods presented, our ratio of earnings to fixed charges and our coverage deficiency. You
should read this table in connection with the financial statements and notes incorporated by reference in this prospectus.
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Year Ended December 31,
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Six Months
Ended
June 30,
2015
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2014
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2013
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2012
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Net loss
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$
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(31,390)
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$
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(20,610)
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$
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(14,455)
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$
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(21,614)
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Ratio of earnings to fixed charges(1)
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N/A
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N/A
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N/A
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N/A
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Coverage deficiency
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$
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(31,390)
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$
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(20,610)
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$
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(14,455)
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$
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(21,614)
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(1)
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We did not record earnings for six months ended June 30, 2015 and the years ended December 31, 2014, 2013 and 2012. Accordingly, our earnings were insufficient to cover fixed charges for such periods and we
are unable to disclose a ratio or earnings to fixed charges for such periods.
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For purposes of calculating the ratios in the
table above, earnings consist of net loss before income taxes. “Fixed charges” include interest expense related to notes payable and capital lease obligations.
7
USE OF PROCEEDS
We intend to use the net proceeds from the sale of the securities being offered by us for general corporate purposes unless otherwise
indicated in the applicable prospectus supplement. General corporate purposes may include acquisition of companies or businesses, repayment and refinancing of debt, working capital, research and development expenditures, clinical trial expenditures,
commercial expenditures and capital expenditures. We have not determined the amount of net proceeds to be used specifically for such purposes. As a result, management will retain broad discretion over the allocation of net proceeds.
We will not receive any of the proceeds from the sale of common stock being offered by any of the selling securityholders.
8
DESCRIPTION OF CAPITAL STOCK
The following description of our capital stock is not complete and may not contain all the information you should consider before investing in
our capital stock. This description is summarized from, and qualified in its entirety by reference to, our restated certificate of incorporation and amended and restated bylaws, copies of which are incorporated by reference as exhibits to the
registration statement of which this prospectus is a part.
Authorized Capital Stock
Our authorized capital stock consists of 200,000,000 shares of common stock, par value $0.001 per share, and 10,000,000 shares of preferred
stock, par value $0.001 per share. As of August 31, 2015, we had 20,339,016 shares of common stock outstanding and no shares of preferred stock outstanding.
Common Stock
Voting Rights and Election of Directors
Holders of our common stock are entitled to one vote for each share held of record on all matters submitted to a vote of shareholders and do
not have any cumulative voting rights. An election of directors by our stockholders is determined by a plurality of the votes cast by the stockholders entitled to vote in the election. Subject to the supermajority votes for some matters, other
matters are decided by the affirmative vote of our stockholders having a majority in voting power of the votes cast by the stockholders present or represented and voting on such matter. Our directors may be removed only for cause and only by the
affirmative vote of the holders of at least
two-thirds
in voting power of the outstanding shares of capital stock entitled to vote thereon. In addition, the affirmative vote of the holders of at least
two-thirds
in voting power of the outstanding shares of capital stock entitled to vote thereon is required to amend or repeal, or to adopt any provision inconsistent with, several of the provisions of our restated
certificate of incorporation.
Dividends
Holders of our common stock are entitled to receive proportionately any dividends as may be declared by the board of directors, subject to any
preferential dividend rights of any outstanding preferred stock that we may designate and issue in the future.
Registration Rights
We have entered into a fourth amended and restated registration rights agreement, dated as of March 22, 2013, as amended on
July 21, 2014, with certain of our stockholders. These holders have the right to require us to register under the Securities Act certain shares they acquired in private placements prior to our initial public offering, under specified
circumstances as described below. After registration pursuant to these rights, these shares will become freely tradable without restriction under the Securities Act.
Demand Registration Rights.
If at any time the holders of at least 30% of the registrable securities request in
writing that we effect a registration of an aggregate amount of at least $10,000,000 with respect to all or part of such registrable securities then outstanding, we may be required to register their shares. We are obligated to effect at most two
registrations in response to these demand registration rights. If the holders requesting registration intend to distribute their shares by means of an underwriting, the managing underwriter of such offering will have the right to limit the numbers
of shares to be underwritten for reasons related to the marketing of the shares.
Piggyback Registration Rights.
If at any
time we propose to register any shares of our common stock under the Securities Act, subject to certain exceptions, the holders of registrable securities will be entitled to notice of the
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registration and to include their shares of registrable securities in the registration. If our proposed registration involves an underwriting, the managing underwriter of such offering will have
the right to limit the number of shares to be underwritten for reasons related to the marketing of the shares.
Form
S-3
Registration Rights.
If at any time the holders of registrable securities request in writing that we effect a registration on
Form S-3
with respect to registrable securities at an aggregate price to the public in the offering of at least $3,000,000, we will be required to effect such registration; provided, however, that we will
not be required to effect such a registration if, within a given
six-month
period, we have already effected one registration on
Form S-3
for the holders of
registrable securities.
Expenses.
Ordinarily, other than underwriting discounts and commissions, we will be
required to pay all expenses incurred by us related to any registration effected pursuant to the exercise of these registration rights. These expenses may include all registration and filing fees, printing expenses, fees and disbursements of our
counsel, reasonable fees and disbursements of a counsel for the selling securityholders and blue sky fees and expenses.
Termination of
Registration Rights.
The registration rights terminate upon the earlier of August 6, 2019 or, with respect to the registration rights of an individual holder, when the holder can sell all of such holder’s
registrable securities in a
90-day
period without restriction under Rule 144 of the Securities Act.
Other Rights and Preferences
Our common stock has no preemptive, subscription, redemption or conversion rights or sinking fund provisions.
Liquidation
In
the event of our liquidation or dissolution, the holders of common stock are entitled to receive proportionately our net assets available for distribution to stockholders after the payment of all debts and other liabilities and subject to the prior
rights of any outstanding preferred stock.
Fully Paid and
Non-Assessable
All outstanding shares of common stock are fully paid and nonassessable.
Listing
Our
common stock is listed on The NASDAQ Global Market under the symbol “TTOO.” On September 15, the closing price for our common stock, as reported on The NASDAQ Global Market, was $12.10 per share.
Transfer Agent
The transfer agent and registrar for our common stock is American Stock Transfer & Trust Company, LLC.
Preferred Stock
Our
board of directors is authorized to direct us to issue up to 10,000,000 shares of preferred stock in one or more series without shareholder approval. Our board of directors has the discretion to determine the rights, preferences, privileges and
restrictions, including voting rights, dividend rights, conversion rights, redemption privileges and liquidation preferences, of each series of preferred stock.
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The purpose of authorizing our board of directors to issue preferred stock and determine its
rights and preferences is to eliminate delays associated with a stockholder vote on specific issuances. The issuance of preferred stock, while providing flexibility in connection with possible acquisitions, future financings and other corporate
purposes, could have the effect of making it more difficult for a third party to acquire, or could discourage a third party from seeking to acquire, a majority of our outstanding voting stock.
Provisions of our Restated Certificate of Incorporation and Amended and Restated Bylaws and Delaware Anti-Takeover Law
Some provisions of Delaware law, our restated certificate of incorporation and our amended and restated bylaws could make the following
transactions more difficult: an acquisition of us by means of a tender offer; an acquisition of us by means of a proxy contest or otherwise; or the removal of our incumbent officers and directors. It is possible that these provisions could make it
more difficult to accomplish or could deter transactions that stockholders may otherwise consider to be in their best interest or in our best interests, including transactions which provide for payment of a premium over the market price for our
shares.
These provisions, summarized below, are intended to discourage coercive takeover practices and inadequate takeover bids. These
provisions are also designed to encourage persons seeking to acquire control of us to first negotiate with our board of directors. We believe that the benefits of the increased protection of our potential ability to negotiate with the proponent of
an unfriendly or unsolicited proposal to acquire or restructure us outweigh the disadvantages of discouraging these proposals because negotiation of these proposals could result in an improvement of their terms.
Undesignated Preferred Stock
The ability of our board of directors, without action by the stockholders, to issue up to 10,000,000 shares of undesignated preferred stock
with voting or other rights or preferences as designated by our board of directors could impede the success of any attempt to change control of us. These and other provisions may have the effect of deferring hostile takeovers or delaying changes in
control or management of our company.
Stockholder Meetings
Our amended and restated bylaws provide that a special meeting of stockholders may be called only by our chief executive officer or president
(in the absence of a chief executive officer), or by a resolution adopted by a majority of our board of directors.
Requirements for
Advance Notification of Stockholder Nominations and Proposals
Our amended and restated bylaws establish advance notice procedures
with respect to stockholder proposals to be brought before a stockholder meeting and the nomination of candidates for election as directors, other than nominations made by or at the direction of the board of directors or a committee of the board of
directors.
No Written Consent of Stockholders
Our restated certificate of incorporation provides that all stockholder actions are required to be taken by a vote of the stockholders at an
annual or special meeting, and that stockholders may not take any action by written consent in lieu of a meeting.
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Staggered Board
Our restated certificate of incorporation provides for the division of our board of directors into three classes serving staggered, three-year
terms, with one class being elected each year by our stockholders. This system of electing and removing directors may tend to discourage a third party from making a tender offer or otherwise attempting to obtain control of us, because it generally
makes it more difficult for stockholders to replace a majority of the directors.
Removal of Directors
Our restated certificate of incorporation provides that no member of our board of directors may be removed from office by our stockholders
except for cause and, in addition to any other vote required by law, upon the approval of the holders of at least
two-thirds
in voting power of the outstanding shares of stock entitled to vote in the election
of directors.
Stockholders Not Entitled to Cumulative Voting
Our restated certificate of incorporation does not permit stockholders to cumulate their votes in the election of directors. Accordingly, the
holders of a majority of the outstanding shares of our common stock entitled to vote in any election of directors can elect all of the directors standing for election, if they choose, other than any directors that holders of our preferred stock may
be entitled to elect.
Delaware Anti-Takeover Law
We are subject to Section 203 of the General Corporation Law of the State of Delaware, which prohibits persons deemed to be
“interested stockholders” from engaging in a “business combination” with a publicly held Delaware corporation for three years following the date these persons become interested stockholders unless the business combination is, or
the transaction in which the person became an interested stockholder was, approved in a prescribed manner or another prescribed exception applies. Generally, an “interested stockholder” is a person who, together with affiliates and
associates, owns, or within three years prior to the determination of interested stockholder status did own, 15% or more of a corporation’s voting stock. Generally, a “business combination” includes a merger, asset or stock sale, or
other transaction resulting in a financial benefit to the interested stockholder. The existence of this provision may have an anti-takeover effect with respect to transactions not approved in advance by the board of directors.
Choice of Forum
Our restated certificate of incorporation provides that, unless we consent in writing to the selection of an alternative form, the Court of
Chancery of the State of Delaware will be the sole and exclusive forum for: (i) any derivative action or proceeding brought on our behalf; (ii) any action asserting a claim of breach of a fiduciary duty or other wrongdoing by any of our
directors, officers, employees or agents to us or our stockholders; (iii) any action asserting a claim against us arising pursuant to any provision of the General Corporation Law of the State of Delaware or our certificate of incorporation or
bylaws; (iv) any action to interpret, apply, enforce or determine the validity of our certificate of incorporation or bylaws; or (v) any action asserting a claim governed by the internal affairs doctrine. Our restated certificate of
incorporation also provides that any person or entity purchasing or otherwise acquiring any interest in shares of our capital stock will be deemed to have notice of and to have consented to this choice of forum provision. It is possible that a court
of law could rule that the choice of forum provision contained in our restated certificate of incorporation is inapplicable or unenforceable if it is challenged in a proceeding or otherwise.
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Amendment to Restated Certificate of Incorporation and Amended and Restated Bylaws
The amendment of any of the above provisions, except for the provision making it possible for our board of directors to issue
preferred stock and the provision prohibiting cumulative voting, would require approval by holders of at least
two-thirds
in voting power of the outstanding shares of stock entitled to vote thereon.
The provisions of Delaware law, our restated certificate of incorporation and our amended and restated bylaws could have the effect of
discouraging others from attempting hostile takeovers and, as a consequence, they may also inhibit temporary fluctuations in the market price of our common stock that often result from actual or rumored hostile takeover attempts. These provisions
may also have the effect of preventing changes in the composition of our board and management. It is possible that these provisions could make it more difficult to accomplish transactions that stockholders may otherwise deem to be in their best
interests.
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DESCRIPTION OF DEBT SECURITIES
The following description, together with the additional information we include in any applicable prospectus supplement, summarizes certain
general terms and provisions of the debt securities that we may offer under this prospectus. When we offer to sell a particular series of debt securities, we will describe the specific terms of the series in a supplement to this prospectus. We will
also indicate in the supplement to what extent the general terms and provisions described in this prospectus apply to a particular series of debt securities.
Subject to consents required from lenders and any other pertinent obligations and limitations under our existing debt facilities, we may issue
debt securities either separately, or together with, or upon the conversion or exercise of or in exchange for, other securities described in this prospectus. Debt securities may be our senior, senior subordinated or subordinated obligations and,
unless otherwise specified in a supplement to this prospectus, the debt securities will be our direct, unsecured obligations and may be issued in one or more series.
The debt securities will be issued under an indenture between us and a third-party trustee to be identified therein. We have summarized select
portions of the indenture below. The summary is not complete. The form of the indenture has been filed as an exhibit to the registration statement and you should read the indenture for provisions that may be important to you. In the summary below,
we have included references to the section numbers of the indenture so that you can easily locate these provisions. Capitalized terms used in the summary and not defined herein have the meanings specified in the indenture.
General
The terms of
each series of debt securities will be established by or pursuant to a resolution of our board of directors and set forth or determined in the manner provided in a resolution of our board of directors, in an officer’s certificate or by a
supplemental indenture. (Section 2.2) The particular terms of each series of debt securities will be described in a prospectus supplement relating to such series (including any pricing supplement or term sheet).
We can issue an unlimited amount of debt securities under the indenture that may be in one or more series with the same or various maturities,
at par, at a premium, or at a discount. (Section 2.1) We will set forth in a prospectus supplement (including any pricing supplement or term sheet) relating to any series of debt securities being offered, the aggregate principal amount and the
following terms of the debt securities, if applicable:
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the title and ranking of the debt securities (including the terms of any subordination provisions);
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the price or prices (expressed as a percentage of the principal amount) at which we will sell the debt securities;
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any limit on the aggregate principal amount of the debt securities;
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the date or dates on which the principal of the securities of the series is payable;
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the rate or rates (which may be fixed or variable) per annum or the method used to determine the rate or rates (including any commodity, commodity index, stock exchange index or financial index) at which the debt
securities will bear interest, the date or dates from which interest will accrue, the date or dates on which interest will commence and be payable and any regular record date for the interest payable on any interest payment date;
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the place or places where principal of, and interest, if any, on the debt securities will be payable (and the
method of such payment), where the securities of such series may be surrendered for registration
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of transfer or exchange, and where notices and demands to us in respect of the debt securities may be delivered;
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the period or periods within which, the price or prices at which and the terms and conditions upon which we may redeem the debt securities;
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any obligation we have to redeem or purchase the debt securities pursuant to any sinking fund or analogous provisions or at the option of a holder of debt securities and the period or periods within which, the price or
prices at which and in the terms and conditions upon which securities of the series shall be redeemed or purchased, in whole or in part, pursuant to such obligation;
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the dates on which and the price or prices at which we will repurchase debt securities at the option of the holders of debt securities and other detailed terms and provisions of these repurchase obligations;
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the denominations in which the debt securities will be issued, if other than denominations of $1,000 and any integral multiple thereof;
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whether the debt securities will be issued in the form of certificated debt securities or global debt securities;
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the portion of principal amount of the debt securities payable upon declaration of acceleration of the maturity date, if other than the principal amount;
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the currency of denomination of the debt securities, which may be United States Dollars or any foreign currency, and if such currency of denomination is a composite currency, the agency or organization, if any,
responsible for overseeing such composite currency;
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the designation of the currency, currencies or currency units in which payment of principal of, premium and interest on the debt securities will be made;
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if payments of principal of, premium or interest on the debt securities will be made in one or more currencies or currency units other than that or those in which the debt securities are denominated, the manner in which
the exchange rate with respect to these payments will be determined;
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the manner in which the amounts of payment of principal of, premium, if any, or interest on the debt securities will be determined, if these amounts may be determined by reference to an index based on a currency or
currencies or by reference to a commodity, commodity index, stock exchange index or financial index;
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any provisions relating to any security provided for the debt securities;
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any addition to, deletion of or change in the Events of Default described in this prospectus or in the indenture with respect to the debt securities and any change in the acceleration provisions described in this
prospectus or in the indenture with respect to the debt securities;
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any addition to, deletion of or change in the covenants described in this prospectus or in the indenture with respect to the debt securities;
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any depositaries, interest rate calculation agents, exchange rate calculation agents or other agents with respect to the debt securities;
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the provisions, if any, relating to conversion or exchange of any debt securities of such series, including if applicable, the conversion or exchange price and period, provisions as to whether conversion or exchange
will be mandatory, the events requiring an adjustment of the conversion or exchange price and provisions affecting conversion or exchange; and
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any other terms of the debt securities, which may supplement, modify or delete any provision of the indenture as it applies to that series, including any terms that may be required under applicable law or regulations or
advisable in connection with the marketing of the securities.
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We may issue debt securities that provide for an amount less
than their stated principal amount to be due and payable upon declaration of acceleration of their maturity pursuant to the terms of the indenture. We will provide you with information on the federal income tax considerations and other special
considerations applicable to any of these debt securities in the applicable prospectus supplement.
If we denominate the purchase price of
any of the debt securities in a foreign currency or currencies or a foreign currency unit or units, or if the principal of and any premium and interest on any series of debt securities is payable in a foreign currency or currencies or a foreign
currency unit or units, we will provide you with information on the restrictions, elections, general tax considerations, specific terms and other information with respect to that issue of debt securities and such foreign currency or currencies or
foreign currency unit or units in the applicable prospectus supplement.
Transfer and Exchange
Each debt security will be represented by either one or more global securities registered in the name of The Depository Trust Company, or the
Depositary, or a nominee of the Depositary (we will refer to any debt security represented by a global debt security as a “book-entry debt security”), or a certificate issued in definitive registered form (we will refer to any debt
security represented by a certificated security as a “certificated debt security”) as set forth in the applicable prospectus supplement. Except as set forth under the heading “Global Debt Securities and Book-Entry System” below,
book-entry debt securities will not be issuable in certificated form.
Certificated Debt Securities. You may transfer or exchange
certificated debt securities at any office we maintain for this purpose in accordance with the terms of the indenture. (Section 2.4) No service charge will be made for any transfer or exchange of certificated debt securities, but we may require
payment of a sum sufficient to cover any tax or other governmental charge payable in connection with a transfer or exchange. (Section 2.7)
You may effect the transfer of certificated debt securities and the right to receive the principal of, premium and interest on certificated
debt securities only by surrendering the certificate representing those certificated debt securities and either reissuance by us or the trustee of the certificate to the new holder or the issuance by us or the trustee of a new certificate to the new
holder.
Global Debt Securities and Book-Entry System. Each global debt security representing book-entry debt securities will be deposited
with, or on behalf of, the Depositary, and registered in the name of the Depositary or a nominee of the Depositary. Please see “Global Securities.”
Covenants
We will set
forth in the applicable prospectus supplement any restrictive covenants applicable to any issue of debt securities. (Article IV)
No Protection in the Event of a Change of Control
Unless we state otherwise in the applicable prospectus supplement, the debt securities will not contain any provisions which may afford
holders of the debt securities protection in the event we have a change in control or in the event of a highly leveraged transaction (whether or not such transaction results in a change in control) which could adversely affect holders of debt
securities.
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Consolidation, Merger and Sale of Assets
We may not consolidate with or merge with or into, or convey, transfer or lease all or substantially all of our properties and assets to any
person (a “successor person”) unless:
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we are the surviving corporation or the successor person (if other than T2 Biosystems) is a corporation organized and validly existing under the laws of any U.S. domestic jurisdiction and expressly assumes our
obligations on the debt securities and under the indenture; and
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immediately after giving effect to the transaction, no Default or Event of Default, shall have occurred and be continuing.
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Notwithstanding the above, any of our subsidiaries may consolidate with, merge into or transfer all or part of its properties to us.
(Section 5.1)
Events of Default
“Event of Default” means with respect to any series of debt securities, any of the following:
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default in the payment of any interest upon any debt security of that series when it becomes due and payable, and continuance of such default for a period of 30 days (unless the entire amount of the payment is
deposited by us with the trustee or with a paying agent prior to the expiration of the
30-day
period);
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default in the payment of principal of any security of that series at its maturity;
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default in the performance or breach of any other covenant or warranty by us in the indenture (other than a covenant or warranty that has been included in the indenture solely for the benefit of a series of debt
securities other than that series), which default continues uncured for a period of 60 days after we receive written notice from the trustee or T2 Biosystems and the trustee receive written notice from the holders of not less than 25% in
principal amount of the outstanding debt securities of that series as provided in the indenture;
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certain voluntary or involuntary events of bankruptcy, insolvency or reorganization of T2 Biosystems;
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any other Event of Default provided with respect to debt securities of that series that is described in the applicable prospectus supplement. (Section 6.1)
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No Event of Default with respect to a particular series of debt securities (except as to certain events of bankruptcy, insolvency or
reorganization) necessarily constitutes an Event of Default with respect to any other series of debt securities. (Section 6.1) The occurrence of certain Events of Default or an acceleration under the indenture may constitute an event of default
under certain indebtedness of ours or our subsidiaries outstanding from time to time.
We will provide the trustee written notice of any
Default or Event of Default within 30 days of becoming aware of the occurrence of such Default or Event of Default, which notice will describe in reasonable detail the status of such Default or Event of Default and what action we are taking or
propose to take in respect thereof. (Section 6.1)
If an Event of Default with respect to debt securities of any series at the time
outstanding occurs and is continuing, then the trustee or the holders of not less than 25% in principal amount of the outstanding debt securities of that series may, by a notice in writing to us (and to the trustee if given by the holders), declare
to be due and payable immediately the principal of (or, if the debt securities of that series are discount securities, that portion of the principal amount as may be specified in the terms of that series) and accrued and unpaid interest, if any, on
all debt securities of that series. In the case of an Event of Default resulting from certain events of bankruptcy, insolvency or reorganization, the principal (or such specified amount) of and accrued and unpaid
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interest, if any, on all outstanding debt securities will become and be immediately due and payable without any declaration or other act on the part of the trustee or any holder of outstanding
debt securities. At any time after a declaration of acceleration with respect to debt securities of any series has been made, but before a judgment or decree for payment of the money due has been obtained by the trustee, the holders of a majority in
principal amount of the outstanding debt securities of that series may rescind and annul the acceleration if all Events of Default, other than the
non-payment
of accelerated principal and interest, if any,
with respect to debt securities of that series, have been cured or waived as provided in the indenture. (Section 6.2) We refer you to the prospectus supplement relating to any series of debt securities that are discount securities for the
particular provisions relating to acceleration of a portion of the principal amount of such discount securities upon the occurrence of an Event of Default.
The indenture provides that the trustee may refuse to perform any duty or exercise any of its rights or powers under the indenture unless the
trustee receives indemnity satisfactory to it against any cost, liability or expense which might be incurred by it in performing such duty or exercising such right or power. (Section 7.1(e)) Subject to certain rights of the trustee, the holders
of a majority in principal amount of the outstanding debt securities of any series will have the right to direct the time, method and place of conducting any proceeding for any remedy available to the trustee or exercising any trust or power
conferred on the trustee with respect to the debt securities of that series. (Section 6.12)
No holder of any debt security of any
series will have any right to institute any proceeding, judicial or otherwise, with respect to the indenture or for the appointment of a receiver or trustee, or for any remedy under the indenture, unless:
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that holder has previously given to the trustee written notice of a continuing Event of Default with respect to debt securities of that series; and
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the holders of not less than 25% in principal amount of the outstanding debt securities of that series have made a written request, and offered indemnity or security satisfactory to the trustee, to the trustee to
institute the proceeding as trustee, and the trustee has not received from the holders of not less than a majority in principal amount of the outstanding debt securities of that series a direction inconsistent with that request and has failed
to institute the proceeding within 60 days. (Section 6.7)
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Notwithstanding any other provision in the indenture,
the holder of any debt security will have an absolute and unconditional right to receive payment of the principal of, premium and any interest on that debt security on or after the due dates expressed in that debt security and to institute suit for
the enforcement of payment. (Section 6.8)
The indenture requires us, within 120 days after the end of our fiscal year, to
furnish to the trustee a statement as to compliance with the indenture. (Section 4.3) If a Default or Event of Default occurs and is continuing with respect to the securities of any series and if it is known to a responsible officer of the
trustee, the trustee shall mail to each securityholder of the securities of that series notice of a Default or Event of Default within 90 days after it occurs or, if later, after a responsible officer of the trustee has knowledge of such
Default or Event of Default. The indenture provides that the trustee may withhold notice to the holders of debt securities of any series of any Default or Event of Default (except in payment on any debt securities of that series) with respect to
debt securities of that series if the trustee determines in good faith that withholding notice is in the interest of the holders of those debt securities. (Section 7.5)
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Modification and Waiver
We and the trustee may modify, amend or supplement the indenture or the debt securities of any series without the consent of any holder of any
debt security:
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to cure any ambiguity, defect or inconsistency;
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to comply with covenants in the indenture described above under the heading “Consolidation, Merger and Sale of Assets”;
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to provide for uncertificated securities in addition to or in place of certificated securities;
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to surrender any of our rights or powers under the indenture;
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to add covenants or events of default for the benefit of the holders of debt securities of any series;
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to comply with the applicable procedures of the applicable depositary;
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to make any change that does not adversely affect the rights of any holder of debt securities;
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to provide for the issuance of and establish the form and terms and conditions of debt securities of any series as permitted by the indenture;
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to effect the appointment of a successor trustee with respect to the debt securities of any series and to add to or change any of the provisions of the indenture to provide for or facilitate administration by more than
one trustee; or
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to comply with requirements of the SEC in order to effect or maintain the qualification of the indenture under the Trust Indenture Act. (Section 9.1)
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We may also modify and amend the indenture with the consent of the holders of at least a majority in principal amount of the outstanding debt
securities of each series affected by the modifications or amendments. We may not make any modification or amendment without the consent of the holders of each affected debt security then outstanding if that amendment will:
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reduce the amount of debt securities whose holders must consent to an amendment, supplement or waiver;
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reduce the rate of or extend the time for payment of interest (including default interest) on any debt security;
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reduce the principal of or premium on or change the fixed maturity of any debt security or reduce the amount of, or postpone the date fixed for, the payment of any sinking fund or analogous obligation with respect to
any series of debt securities;
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reduce the principal amount of discount securities payable upon acceleration of maturity;
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waive a default in the payment of the principal of, premium or interest on any debt security (except a rescission of acceleration of the debt securities of any series by the holders of at least a majority in aggregate
principal amount of the then outstanding debt securities of that series and a waiver of the payment default that resulted from such acceleration);
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make the principal of or premium or interest on any debt security payable in currency other than that stated in the debt security;
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make any change to certain provisions of the indenture relating to, among other things, the right of holders of debt securities to receive payment of the principal of, premium and interest on those debt securities and
to institute suit for the enforcement of any such payment and to waivers or amendments; or
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waive a redemption payment with respect to any debt security. (Section 9.3)
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Except for
certain specified provisions, the holders of at least a majority in principal amount of the outstanding debt securities of any series may on behalf of the holders of all debt securities of that series waive our compliance with provisions of the
indenture. (Section 9.2) The holders of a majority in principal amount of the outstanding debt securities of any series may on behalf of the holders of all the debt securities of such series waive any past default under the indenture with
respect to that series and its consequences, except a default in the payment of the principal of, premium or any interest on any debt security of that series;
provided
,
however
, that the holders of a majority in principal amount of
the outstanding debt securities of any series may rescind an acceleration and its consequences, including any related payment default that resulted from the acceleration. (Section 6.13)
Defeasance of Debt Securities and Certain Covenants in Certain Circumstances
Legal Defeasance.
The indenture provides that, unless otherwise provided by the terms of the applicable
series of debt securities, we may be discharged from any and all obligations in respect of the debt securities of any series (subject to certain exceptions). We will be so discharged upon the deposit with the trustee, in trust, of money and/or U.S.
government obligations or, in the case of debt securities denominated in a single currency other than U.S. Dollars, government obligations of the government that issued or caused to be issued such currency, that, through the payment of interest and
principal in accordance with their terms, will provide money or U.S. government obligations in an amount sufficient in the opinion of a nationally recognized firm of independent public accountants or investment bank to pay and discharge each
installment of principal, premium and interest on and any mandatory sinking fund payments in respect of the debt securities of that series on the stated maturity of those payments in accordance with the terms of the indenture and those debt
securities.
This discharge may occur only if, among other things, we have delivered to the trustee an opinion of counsel stating that we
have received from, or there has been published by, the United States Internal Revenue Service a ruling or, since the date of execution of the indenture, there has been a change in the applicable United States federal income tax law, in either case
to the effect that, and based thereon such opinion shall confirm that, the holders of the debt securities of that series will not recognize income, gain or loss for United States federal income tax purposes as a result of the deposit, defeasance and
discharge and will be subject to United States federal income tax on the same amounts and in the same manner and at the same times as would have been the case if the deposit, defeasance and discharge had not occurred. (Section 8.3)
Defeasance of Certain Covenants.
The indenture provides that, unless otherwise provided by the terms of
the applicable series of debt securities, upon compliance with certain conditions:
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we may omit to comply with the covenant described under the heading “Consolidation, Merger and Sale of Assets” and certain other covenants set forth in the indenture, as well as any additional covenants which
may be set forth in the applicable prospectus supplement; and
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any omission to comply with those covenants will not constitute a Default or an Event of Default with respect to the debt securities of that series (“covenant defeasance”).
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The conditions include:
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depositing with the trustee money and/or U.S. government obligations or, in the case of debt securities
denominated in a single currency other than U.S. Dollars, government obligations of the government that issued or caused to be issued such currency, that, through the payment of interest and principal in accordance with their terms, will provide
money in an amount sufficient in the opinion of a nationally recognized firm of independent public accountants or investment bank to pay and discharge each installment of principal of, premium and interest on and any mandatory sinking fund payments
in respect of the debt securities of that series on the stated maturity of those payments
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in accordance with the terms of the indenture and those debt securities; and
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delivering to the trustee an opinion of counsel to the effect that we have received from, or there has been published by, the United States Internal Revenue Service a ruling or, since the date of execution of the
indenture, there has been a change in the applicable United States federal income tax law, in either case to the effect that, and based thereon such opinion shall confirm that, the holders of the debt securities of that series will not recognize
income, gain or loss for United States federal income tax purposes as a result of the deposit and related covenant defeasance and will be subject to United States federal income tax on the same amounts and in the same manner and at the same times as
would have been the case if the deposit and related covenant defeasance had not occurred. (Section 8.4)
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No Personal
Liability of Directors, Officers, Employees or Stockholders
None of our past, present or future directors, officers, employees or
stockholders, as such, will have any liability for any of our obligations under the debt securities or the indenture or for any claim based on, or in respect or by reason of, such obligations or their creation. By accepting a debt security, each
holder waives and releases all such liability. This waiver and release is part of the consideration for the issue of the debt securities. However, this waiver and release may not be effective to waive liabilities under U.S. federal securities laws,
and it is the view of the SEC that such a waiver is against public policy.
Governing Law
The indenture and the debt securities, including any claim or controversy arising out of or relating to the indenture or the securities, will
be governed by the laws of the State of New York. (Section 10.10)
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DESCRIPTION OF WARRANTS
We may issue warrants for the purchase of shares of our common stock or preferred stock or of debt securities. We may issue warrants
independently or together with other securities, and the warrants may be attached to or separate from any offered securities. Each series of warrants will be issued under a separate warrant agreement to be entered into between us and the investors
or a warrant agent. The following summary of material provisions of the warrants and warrant agreements are subject to, and qualified in their entirety by reference to, all the provisions of the warrant agreement and warrant certificate applicable
to a particular series of warrants. The terms of any warrants offered under a prospectus supplement may differ from the terms described below. We urge you to read the applicable prospectus supplement and any related free writing prospectus, as well
as the complete warrant agreements and warrant certificates that contain the terms of the warrants.
The particular terms of any issue of
warrants will be described in the prospectus supplement relating to the issue. Those terms may include:
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the number of shares of common stock or preferred stock purchasable upon the exercise of warrants to purchase such shares and the price at which such number of shares may be purchased upon such exercise;
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the designation, stated value and terms (including, without limitation, liquidation, dividend, conversion and voting rights) of the series of preferred stock purchasable upon exercise of warrants to purchase preferred
stock;
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the principal amount of debt securities that may be purchased upon exercise of a debt warrant and the exercise price for the warrants, which may be payable in cash, securities or other property;
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the date, if any, on and after which the warrants and the related debt securities, preferred stock or common stock will be separately transferable;
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the terms of any rights to redeem or call the warrants;
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the date on which the right to exercise the warrants will commence and the date on which the right will expire;
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United States Federal income tax consequences applicable to the warrants; and
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any additional terms of the warrants, including terms, procedures, and limitations relating to the exchange, exercise and settlement of the warrants.
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Holders of equity warrants will not be entitled to:
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vote, consent or receive dividends;
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receive notice as stockholders with respect to any meeting of stockholders for the election of our directors or any other matter; or
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exercise any rights as stockholders of T2 Biosystems.
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Each warrant will entitle its holder to
purchase the principal amount of debt securities or the number of shares of preferred stock or common stock at the exercise price set forth in, or calculable as set forth in, the applicable prospectus supplement. Unless we otherwise specify in the
applicable prospectus supplement, holders of the warrants may exercise the warrants at any time up to the specified time on the expiration date that we set forth in the applicable prospectus supplement. After the close of business on the expiration
date, unexercised warrants will become void.
A holder of warrant certificates may exchange them for new warrant certificates of different
denominations, present them for registration of transfer and exercise them at the corporate trust office of the warrant agent or any
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other office indicated in the applicable prospectus supplement. Until any warrants to purchase debt securities are exercised, the holder of the warrants will not have any rights of holders of the
debt securities that can be purchased upon exercise, including any rights to receive payments of principal, premium or interest on the underlying debt securities or to enforce covenants in the applicable indenture. Until any warrants to purchase
common stock or preferred stock are exercised, the holders of the warrants will not have any rights of holders of the underlying common stock or preferred stock, including any rights to receive dividends or payments upon any liquidation, dissolution
or winding up on the common stock or preferred stock, if any.
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DESCRIPTION OF UNITS
We may issue units consisting of any combination of the other types of securities offered under this prospectus in one or more series. We may
evidence each series of units by unit certificates that we will issue under a separate agreement. We may enter into unit agreements with a unit agent. Each unit agent will be a bank or trust company that we select. We will indicate the name and
address of the unit agent in the applicable prospectus supplement relating to a particular series of units.
The following description,
together with the additional information included in any applicable prospectus supplement, summarizes the general features of the units that we may offer under this prospectus. You should read any prospectus supplement and any free writing
prospectus that we may authorize to be provided to you related to the series of units being offered, as well as the complete unit agreements that contain the terms of the units. Specific unit agreements will contain additional important terms and
provisions and we will file as an exhibit to the registration statement of which this prospectus is a part, or will incorporate by reference from another report that we file with the SEC, the form of each unit agreement relating to units offered
under this prospectus.
If we offer any units, certain terms of that series of units will be described in the applicable prospectus
supplement, including, without limitation, the following, as applicable:
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the title of the series of units;
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identification and description of the separate constituent securities comprising the units;
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the price or prices at which the units will be issued;
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the date, if any, on and after which the constituent securities comprising the units will be separately transferable;
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a discussion of certain United States federal income tax considerations applicable to the units; and
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any other terms of the units and their constituent securities.
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GLOBAL SECURITIES
Book-Entry, Delivery and Form
Unless we indicate differently in a prospectus supplement, the securities initially will be issued in book-entry form and represented by one
or more global notes or global securities, or, collectively, global securities. The global securities will be deposited with, or on behalf of, The Depository Trust Company, New York, New York, as depositary, or DTC, and registered in the name of
Cede & Co., the nominee of DTC. Unless and until it is exchanged for individual certificates evidencing securities under the limited circumstances described below, a global security may not be transferred except as a whole by the
depositary to its nominee or by the nominee to the depositary, or by the depositary or its nominee to a successor depositary or to a nominee of the successor depositary.
DTC has advised us that it is:
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a limited-purpose trust company organized under the New York Banking Law;
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a “banking organization” within the meaning of the New York Banking Law;
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a member of the Federal Reserve System;
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a “clearing corporation” within the meaning of the New York Uniform Commercial Code; and
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a “clearing agency” registered pursuant to the provisions of Section 17A of the Exchange Act.
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DTC holds securities that its participants deposit with DTC. DTC also facilitates the settlement among its participants of securities
transactions, such as transfers and pledges, in deposited securities through electronic computerized book-entry changes in participants’ accounts, thereby eliminating the need for physical movement of securities certificates. “Direct
participants” in DTC include securities brokers and dealers, including underwriters, banks, trust companies, clearing corporations and other organizations. DTC is a wholly owned subsidiary of The Depository Trust & Clearing
Corporation, or DTCC. DTCC is the holding company for DTC, National Securities Clearing Corporation and Fixed Income Clearing Corporation, all of which are registered clearing agencies. DTCC is owned by the users of its regulated subsidiaries.
Access to the DTC system is also available to others, which we sometimes refer to as indirect participants that clear through or maintain a custodial relationship with a direct participant, either directly or indirectly. The rules applicable to DTC
and its participants are on file with the SEC.
Purchases of securities under the DTC system must be made by or through direct
participants, which will receive a credit for the securities on DTC’s records. The ownership interest of the actual purchaser of a security, which we sometimes refer to as a beneficial owner, is in turn recorded on the direct and indirect
participants’ records. Beneficial owners of securities will not receive written confirmation from DTC of their purchases. However, beneficial owners are expected to receive written confirmations providing details of their transactions, as well
as periodic statements of their holdings, from the direct or indirect participants through which they purchased securities. Transfers of ownership interests in global securities are to be accomplished by entries made on the books of participants
acting on behalf of beneficial owners. Beneficial owners will not receive certificates representing their ownership interests in the global securities, except under the limited circumstances described below.
To facilitate subsequent transfers, all global securities deposited by direct participants with DTC will be registered in the name of
DTC’s partnership nominee, Cede & Co., or such other name as may be requested by an authorized representative of DTC. The deposit of securities with DTC and their registration in the name of Cede & Co. or such other
nominee will not change the beneficial ownership of the securities. DTC has no knowledge of the actual beneficial owners of the securities. DTC’s records reflect only the identity of the direct participants to whose accounts the securities are
credited, which may or may not be the beneficial owners. The
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participants are responsible for keeping account of their holdings on behalf of their customers.
So long as the securities are in book-entry form, you will receive payments and may transfer securities only through the facilities of the
depositary and its direct and indirect participants. We will maintain an office or agency in the location specified in the prospectus supplement for the applicable securities, where notices and demands in respect of the securities and the indenture
may be delivered to us and where certificated securities may be surrendered for payment, registration of transfer or exchange.
Conveyance
of notices and other communications by DTC to direct participants, by direct participants to indirect participants and by direct participants and indirect participants to beneficial owners will be governed by arrangements among them, subject to any
legal requirements in effect from time to time.
Redemption notices will be sent to DTC. If less than all of the securities of a
particular series are being redeemed, DTC’s practice is to determine by lot the amount of the interest of each direct participant in the securities of such series to be redeemed.
Neither DTC nor Cede & Co. (or such other DTC nominee) will consent or vote with respect to the securities. Under its usual
procedures, DTC will mail an omnibus proxy to us as soon as possible after the record date. The omnibus proxy assigns the consenting or voting rights of Cede & Co. to those direct participants to whose accounts the securities of such
series are credited on the record date, identified in a listing attached to the omnibus proxy.
So long as securities are in book-entry
form, we will make payments on those securities to the depositary or its nominee, as the registered owner of such securities, by wire transfer of immediately available funds. If securities are issued in definitive certificated form under the limited
circumstances described below, we will have the option of making payments by check mailed to the addresses of the persons entitled to payment or by wire transfer to bank accounts in the United States designated in writing to the applicable trustee
or other designated party at least 15 days before the applicable payment date by the persons entitled to payment, unless a shorter period is satisfactory to the applicable trustee or other designated party.
Redemption proceeds, distributions and dividend payments on the securities will be made to Cede & Co., or such other nominee as
may be requested by an authorized representative of DTC. DTC’s practice is to credit direct participants’ accounts upon DTC’s receipt of funds and corresponding detail information from us on the payment date in accordance with their
respective holdings shown on DTC records. Payments by participants to beneficial owners will be governed by standing instructions and customary practices, as is the case with securities held for the account of customers in bearer form or registered
in “street name.” Those payments will be the responsibility of participants and not of DTC or us, subject to any statutory or regulatory requirements in effect from time to time. Payment of redemption proceeds, distributions and dividend
payments to Cede & Co., or such other nominee as may be requested by an authorized representative of DTC, is our responsibility, disbursement of payments to direct participants is the responsibility of DTC, and disbursement of payments
to the beneficial owners is the responsibility of direct and indirect participants.
Except under the limited circumstances described
below, purchasers of securities will not be entitled to have securities registered in their names and will not receive physical delivery of securities. Accordingly, each beneficial owner must rely on the procedures of DTC and its participants to
exercise any rights under the securities and the indenture.
The laws of some jurisdictions may require that some purchasers of securities
take physical delivery of securities in definitive form. Those laws may impair the ability to transfer or pledge beneficial interests in securities.
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DTC may discontinue providing its services as securities depositary with respect to the
securities at any time by giving reasonable notice to us. Under such circumstances, in the event that a successor depositary is not obtained, securities certificates are required to be printed and delivered.
As noted above, beneficial owners of a particular series of securities generally will not receive certificates representing their ownership
interests in those securities. However, if:
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DTC notifies us that it is unwilling or unable to continue as a depositary for the global security or securities representing such series of securities or if DTC ceases to be a clearing agency registered under the
Exchange Act at a time when it is required to be registered and a successor depositary is not appointed within 90 days of the notification to us or of our becoming aware of DTC’s ceasing to be so registered, as the case may be;
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we determine, in our sole discretion, not to have such securities represented by one or more global securities; or
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an Event of Default has occurred and is continuing with respect to such series of securities,
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we will prepare
and deliver certificates for such securities in exchange for beneficial interests in the global securities. Any beneficial interest in a global security that is exchangeable under the circumstances described in the preceding sentence will be
exchangeable for securities in definitive certificated form registered in the names that the depositary directs. It is expected that these directions will be based upon directions received by the depositary from its participants with respect to
ownership of beneficial interests in the global securities.
We have obtained the information in this section and elsewhere in this
prospectus concerning DTC and DTC’s book-entry system from sources that are believed to be reliable, but we take no responsibility for the accuracy of this information.
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SELLING SECURITYHOLDERS
This prospectus also relates to the possible resale by certain of our stockholders, who we refer to in this prospectus as the “selling
securityholders,” of up to $43,000,000 in the aggregate of our common stock that were issued and outstanding, or that are issuable upon exercise of options to acquire common stock that were issued and outstanding, prior to the original date of
filing of the registration statement of which this prospectus forms a part. The selling securityholders originally acquired the shares of our common stock included in this prospectus pursuant to several private placements of our convertible
preferred stock and warrants to purchase convertible preferred stock prior to our initial public offering. All shares of convertible preferred stock and outstanding warrants converted into shares of our common stock in connection with our initial
public offering.
Information about the selling securityholders, where applicable, including their identities, the amount of shares of
common stock owned by each selling securityholder prior to the offering, the number of shares of our common stock to be offered by each selling securityholder and the amount of common stock to be owned by each selling securityholder after completion
of the offering, will be set forth in an applicable prospectus supplement, documents incorporated by reference or in a free writing prospectus we file with the SEC. The applicable prospectus supplement will also disclose whether any of the selling
securityholders has held any position or office with, has been employed by or otherwise has had a material relationship with us during the three years prior to the date of the prospectus supplement.
The selling securityholders may not sell any shares of our common stock pursuant to this prospectus until we have identified such selling
securityholders and the shares being offered for resale by such selling securityholders in a subsequent prospectus supplement. However, the selling securityholders may sell or transfer all or a portion of their shares of our common stock pursuant to
any available exemption from the registration requirements of the Securities Act.
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PLAN OF DISTRIBUTION
We or the selling securityholders may sell the securities from time to time pursuant to underwritten public offerings, negotiated
transactions, block trades or a combination of these methods or through underwriters or dealers, through agents and/or directly to one or more purchasers. The securities may be distributed from time to time in one or more transactions:
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at a fixed price or prices, which may be changed;
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at market prices prevailing at the time of sale;
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at prices related to such prevailing market prices; or
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Each time that we or any of the selling securityholders sell securities
covered by this prospectus, we or the selling securityholders will provide a prospectus supplement or supplements that will describe the method of distribution and set forth the terms and conditions of the offering of such securities, including the
offering price of the securities and the proceeds to us or the selling securityholders, if applicable.
Offers to purchase the securities
being offered by this prospectus may be solicited directly. Agents may also be designated to solicit offers to purchase the securities from time to time. Any agent involved in the offer or sale of our securities will be identified in a prospectus
supplement.
If a dealer is utilized in the sale of the securities being offered by this prospectus, the securities will be sold to the
dealer, as principal. The dealer may then resell the securities to the public at varying prices to be determined by the dealer at the time of resale.
If an underwriter is utilized in the sale of the securities being offered by this prospectus, an underwriting agreement will be executed with
the underwriter at the time of sale and the name of any underwriter will be provided in the prospectus supplement that the underwriter will use to make resales of the securities to the public. In connection with the sale of the securities, we, or
the selling securityholders, or the purchasers of securities for whom the underwriter may act as agent, may compensate the underwriter in the form of underwriting discounts or commissions. The underwriter may sell the securities to or through
dealers, and those dealers may receive compensation in the form of discounts, concessions or commissions from the underwriters and/or commissions from the purchasers for which they may act as agent. Unless otherwise indicated in a prospectus
supplement, an agent will be acting on a best efforts basis and a dealer will purchase securities as a principal, and may then resell the securities at varying prices to be determined by the dealer.
Any compensation paid to underwriters, dealers or agents in connection with the offering of the securities, and any discounts, concessions or
commissions allowed by underwriters to participating dealers will be provided in the applicable prospectus supplement. Underwriters, dealers and agents participating in the distribution of the securities may be deemed to be underwriters within the
meaning of the Securities Act of 1933, as amended, and any discounts and commissions received by them and any profit realized by them on resale of the securities may be deemed to be underwriting discounts and commissions. We may enter into
agreements to indemnify underwriters, dealers and agents against civil liabilities, including liabilities under the Securities Act, or to contribute to payments they may be required to make in respect thereof and to reimburse those persons for
certain expenses.
Any common stock will be listed on The NASDAQ Global Market, but any other securities may or may not be listed on a
national securities exchange. To facilitate the offering of securities, certain persons participating in the offering may engage in transactions that stabilize, maintain or otherwise affect the price of the securities. This may include
over-allotments or short sales of the securities, which involve the sale by persons participating in the offering of more securities than were sold to them. In these circumstances, these persons would cover such
over-
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allotments or short positions by making purchases in the open market or by exercising their over-allotment option, if any. In addition, these persons may stabilize or maintain the price of the
securities by bidding for or purchasing securities in the open market or by imposing penalty bids, whereby selling concessions allowed to dealers participating in the offering may be reclaimed if securities sold by them are repurchased in connection
with stabilization transactions. The effect of these transactions may be to stabilize or maintain the market price of the securities at a level above that which might otherwise prevail in the open market. These transactions may be discontinued at
any time.
We may engage in at the market offerings into an existing trading market in accordance with Rule 415(a)(4) under the
Securities Act. In addition, we may enter into derivative transactions with third parties, or sell securities not covered by this prospectus to third parties in privately negotiated transactions. If the applicable prospectus supplement so indicates,
in connection with those derivatives, the third parties may sell securities covered by this prospectus and the applicable prospectus supplement, including in short sale transactions. If so, the third party may use securities pledged by us or
borrowed from us or others to settle those sales or to close out any related open borrowings of stock, and may use securities received from us in settlement of those derivatives to close out any related open borrowings of stock. The third party in
such sale transactions will be an underwriter and, if not identified in this prospectus, will be named in the applicable prospectus supplement (or a post-effective amendment). In addition, we may otherwise loan or pledge securities to a financial
institution or other third party that in turn may sell the securities short using this prospectus and an applicable prospectus supplement. Such financial institution or other third party may transfer its economic short position to investors in our
securities or in connection with a concurrent offering of other securities.
The specific terms of any
lock-up
provisions in respect of any given offering will be described in the applicable prospectus supplement.
In compliance with the guidelines of the Financial Industry Regulatory Authority, Inc., or FINRA, the maximum consideration or discount
to be received by any FINRA member or independent broker dealer may not exceed 8% of the aggregate proceeds of the offering.
The
underwriters, dealers and agents may engage in transactions with us, or perform services for us, in the ordinary course of business for which they receive compensation.
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LEGAL MATTERS
Latham & Watkins LLP will pass upon certain legal matters relating to the issuance and sale of the securities offered hereby on behalf of
T2 Biosystems, Inc. Additional legal matters may be passed upon for us, the selling securityholders or any underwriters, dealers or agents, by counsel that we will name in the applicable prospectus supplement.
EXPERTS
Ernst & Young LLP, independent registered public accounting firm, has audited our consolidated financial statements included in our Annual
Report on Form 10-K for the year ended December 31, 2014, as set forth in their report, which is incorporated by reference in this prospectus and elsewhere in the registration statement. Our financial statements are incorporated by reference in
reliance on Ernst & Young LLP’s report, given on their authority as experts in accounting and auditing.
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4,375,000 Shares
Common Stock
PROSPECTUS SUPPLEMENT
Joint Book Running Managers
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Canaccord Genuity
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Cantor Fitzgerald & Co.
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Co-Managers
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Janney Montgomery Scott
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JonesTrading
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WBB Securities, LLC
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September 15, 2017
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