Press Release Biocartis Group NV

Agreement regarding recapitalization of operating subsidiaries by secured by secured creditors and wind down of listed holding company - Seite 2

Biocartis's CEO, Roger Moody, stated: “This announced recapitalization and balance sheet restructuring plan follows an extensive process by the Board and Management to address Biocartis’s leverage and liquidity position. Following that process, it became evident that the difficult market conditions combined with the Company’s balance sheet and historic burn rate made outside funding unattainable. While disappointing to shareholders and unsecured bondholders, this Transaction is necessary, and the EUR 40 million of new equity capital to the operating businesses, combined with the material deleveraging is expected to provide the Biocartis business with funding to operational break-even. The core business performance remains strong, with 22% growth of oncology cartridge revenue, a 40% gross margin on product sales and a 20% improvement in EBITDA to EUR -14.5 million in H1 2023. I am convinced that, under the new, recapitalized holding company and in combination with the operational reorganization that is now being completed, the surviving business under new ownership will be able to continue our path to a financially healthy and sustainable business. The restructuring and recapitalization allows the Biocartis business to continue its mission to enable universal access to personalized medicine for patients around the world by making molecular testing convenient, fast, and suitable for any lab.”

Main features of the Transaction: The Transaction will provide for the following:

• The Company’s EUR 116 million 4.5% Second Ranking Secured Convertible Bonds due 2026 (ISIN BE6338582206) (the “Bonds”, and the holders of the Bonds, the “Bondholders”) will be fully equitized into New Biocartis (as defined below) and the Bondholders will become the primary owners of Biocartis’s operating business through their shareholding in New Biocartis. A new entity will be incorporated (“New Biocartis”), owned by the Secured Creditors, to which substantially all the Company’s assets will be transferred upon an anticipated security enforcement by the Secured Creditors over the Company’s assets that were pledged to such creditors.
• The Bondholders will recapitalize New Biocartis (and its operating subsidiaries) with EUR 40 million of equity capital, backstopped by a group of supporting Bondholders (the “Equity Injection”).
• Lenders under the Company’s first lien convertible term loan facility (the “First Lien Creditors”) have agreed to roll over their first lien debt into New Biocartis (or its wholly owned subsidiaries) and release claims against Biocartis Group NV. KBC have agreed to extend their financing to Biocartis NV and Biocartis US Inc.
• Shareholders of Biocartis Group NV will receive no distribution from the security enforcement and are expected to receive nothing at the time of its wind down.
• The interests and claims of the EUR 16 million unsecured 4.00% convertible bonds due 2027 (ISIN BE0002651322) (the "Unsecured 2027 Bonds") will be written down to zero pursuant to their terms as part of the enforcement.
• Following the full equitization of EUR 116 million of Bonds, the write down of EUR 16 million of Unsecured 2027 Bonds, and the closing of the Equity Injection, New Biocartis will have less than EUR 45 million of gross debt and net debt of approximately zero, allowing it to continue the operations of the Biocartis group.

The Transaction is pursuant to the consent of all First Lien Creditors and more than 75% of Bondholders. To date, 100% of the First Lien Creditors and more than 90% of the Bondholders have delivered support letters with respect to the Transaction.