TransMedics Group Proposed Offering of $300 Million of Convertible Senior Notes

TransMedics Group, Inc.(Nasdaq: TMDX), a medical technology company that is transforming organ transplant therapy for patients with end-stage lung, heart, and liver failure, today announced that it intends to offer, subject to market and other conditions, $300 million aggregate principal amount of convertible senior unsecured notes that will mature on June 1, 2028, unless earlier redeemed, repurchased or converted. TransMedics also expects to grant the initial purchasers of the notes an option to purchase, within a 13-day period beginning on, and including, the initial issuance date of the notes, up to an additional $45 million aggregate principal amount of notes.

TransMedics intends to use a portion of the net proceeds from the offering to pay the cost of certain capped call transactions (described below). In addition, TransMedics intends to use the remaining net proceeds to expand its logistics network through potential partnerships or acquisitions and for general corporate purposes.

The notes will be senior unsecured obligations of TransMedics and bear cash interest, payable semiannually in arrears on June 1 and December 1 of each year, beginning on December 1, 2023. The notes will be convertible, only during certain periods and subject to certain circumstances, into cash, shares of TransMedics common stock, or a combination of cash and shares of TransMedics common stock, at TransMedics’ election. Prior to June 8, 2026, the notes will not be redeemable. On or after June 8, 2026, TransMedics may redeem for cash all or a portion of the notes (subject to certain conditions), at its option, if the last reported sale price of TransMedics’ common stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which TransMedics provides notice of redemption at a redemption price equal to 100% of the principal amount of the notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date. Final terms of the notes, including the interest rate, conversion rate, conversion price, and certain other terms of the offering, will be determined at the time of pricing of the offering.

In connection with the pricing of the notes, TransMedics expects to enter into privately negotiated capped call transactions with one or more of the initial purchasers and/or their respective affiliates and/or other financial institutions (the “option counterparties”). The capped call transactions are expected generally to reduce the potential dilution to TransMedics’ common stock upon conversion of any notes and/or offset any potential cash payments TransMedics is required to make in excess of the principal amount of converted notes, as the case may be, with such reduction and/or offset subject to a cap. To the extent any observation period for any converted notes does not correspond to the period during which the market price of TransMedics’ common stock is measured under the terms of the capped call transactions, there could also be dilution and/or a reduced offset of any such cash payments as a result of the different measurement periods. If the initial purchasers of the notes exercise their option to purchase additional notes, TransMedics expects to enter into additional capped call transactions with the option counterparties.

About TransMedics Group, Inc.
TransMedics is the world’s leader in portable extracorporeal warm perfusion and assessment of donor organs for transplantation. Headquartered in Andover, Massachusetts, the company was founded to address the unmet need for more and better organs for transplantation and has developed technologies to preserve organ quality, assess organ viability prior to transplant, and potentially increase the utilization of donor organs for the treatment of end-stage heart, lung, and liver failure.