TORONTO, Ontario, May 29, 2023 (GLOBE NEWSWIRE) — Titan Medical Inc. (“Titan” or the “Company”) (TSX: TMD; OTC: TMDIF) announced today a corporate update and is also providing a default status report in accordance with the alternative information guidelines set out in National Policy 12-203 – Management Cease Trade Orders (“NP 12-203”).
As a result of the strategic review process (“Strategic Review”) announced on November 30, 2022, the Board of Directors of Titan have approved a strategic transition (“Strategic Transition”) in the Company’s business from the development and commercialization of robotic-assisted surgery (“RAS”) technologies to evaluating new opportunities to further develop and license its intellectual property (“IP”). Titan continues to retain the rights necessary to develop and commercialize RAS technologies, should it choose to do so, including the two-instrument Enos single-access RAS system (the “Enos System”) and, as announced on January 9, 2023, a three-instrument single-access RAS system that builds on the Enos System technologies.
In connection with the Strategic Review, as previously disclosed, Raymond James Ltd. and members of Titan’s leadership team, conducted a comprehensive outreach to over 55 potential counterparties, engaged in a number of management presentations and cooperated in confidential due diligence reviews by a subset of the potential counterparties. While none of the parties expressed an interest in acquiring the Company’s business, the Company has, as announced last week, entered into a license agreement with a third party and continues to evaluate additional licensing opportunities.
With today’s announcement, the Company has concluded its engagement with Raymond James with respect to the Strategic Review. While focusing on the Strategic Transition, the Company will continue to review and evaluate further strategic alternatives for the business, including a corporate sale, merger or other business combination, a sale of all or a portion of the company’s assets, strategic investment or other significant transaction.
In order to further reduce operating cost in the business, the following management changes will occur effective June 1, 2023:
- Cary Vance will step down as the Company’s President and CEO. Paul Cataford will be appointed Interim President and CEO while the Company continues with its Strategic Transition. Mr. Vance will remain on the Board, replacing Mr. Cataford on each of his Board Committee assignments. Mr. Cataford will continue as Board Chair.
- Chien Huang, the Company’s Vice President, Finance will be appointed Chief Financial Officer and the Company’s current Chief Financial Officer, Stephen Lemieux, will transition to a consulting role to ensure an orderly transition and provide ongoing support to Mr. Huang, Mr. Cataford and the Board.
- Jasminder Brar, the Company’s Vice President, Legal and IP, General Counsel and Corporate Secretary, will transition to a consulting role to assist and advise the Company with IP transition and strategy.
- Bill Fahey, the Company’s Vice President, Operations and Manufacturing, will transition to a consulting role to assist the Company with technical matters.
- Nate Jones, the Company’s Director of Human Resources will transition to a consulting role to assist the Company with human resources matters related to Titan Medical USA Inc., its wholly owned U.S. subsidiary.
“I would like to congratulate Chien on his appointment to CFO. Chien is a seasoned financial professional with experience in an IP licensing business,” said Paul Cataford, Chair of the Board of Directors of Titan Medical. “We would like to thank Stephen, Jasminder, Bill and Nate for their effective leadership through the Strategic Review process and for their willingness to remain engaged and available in a consulting capacity to support the Company through the Strategic Transition. The announcement made last week is demonstrative of the Company’s foundational intellectual property and its important role in the field of robotic assisted surgery. Finally, we would also like to thank Cary for his time as President and CEO and look forward to continuing to work with him on the Board.”
Bi-Weekly MCTO Default Status Report:
On March 22, 2023, and as further updated on April 3, 2023, April 17, 2023, May 1, 2023, and May 15, 2023, the Company announced (the “Default Announcement”) that under NP 12-203 it had applied to the Ontario Securities Commission (the “OSC”) requesting a management cease trade order (“MCTO”) be imposed in respect of the late filing of its annual financial statements, the related management’s discussion and analysis and annual information form, and the accompanying chief executive officer and chief financial officer certification for its financial year ended December 31, 2022 (collectively, the “Annual Filing Documents”). The MCTO was granted by the OSC on April 3, 2023.
On May 19, 2023, the Company announced a related delay in filings its financial statements, the related management’s discussion and analysis and the accompanying chief executive officer and chief financial officer certification for its first quarter ended March 31, 2023 (the “Q1 Filing Documents”). As previously disclosed, the Company expects to file the Annual Filing Documents by May 31, 2023 and the Q1 Filing Documents by June 9, 2023.
The MCTO restricts all trading in and all acquisitions of the securities of the Company, directly or indirectly, by the Chief Executive Officer and the Chief Financial Officer of the Company until two full business days following the receipt by the OSC of the Annual Filing Documents and any other filings the Company is required to make under Ontario securities laws, or upon the further order of the director of the OSC. The MCTO does not affect the ability of shareholders who are not named in the MCTO to trade their securities.
The Company confirms that other than as stated above: (a) there are no material changes to the information contained in the Default Announcement or the affairs of the Company that has not been generally disclosed; (b) the Company is satisfying and confirms that it intends to continue to satisfy the provisions of the alternative information guidelines under NP 12-203; (c) there has not been any other specified default by the Company under NP 12-203; and (d) the Company is working to complete the Annual Filing Documents.
The Company will continue to issue bi-weekly default status reports as required.
About Titan Medical
Titan Medical Inc. (TSX: TMD; OTC: TMDIF), a medical technology company headquartered in Toronto, Ontario with operations in Chapel Hill, North Carolina, has developed an expansive patent portfolio related to the enhancement of robotic assisted surgery (RAS), including through a single access point, and is currently focused on evaluating new opportunities to further develop and license its intellectual property.
Cautionary Statement Regarding Forward-Looking Information
This news release contains “forward-looking statements” within the meaning of applicable Canadian and U.S. securities laws, which reflect the current expectations of management of the Company’s future growth, results of operations, performance and business prospects and opportunities. Forward-looking statements are frequently, but not always, identified by words such as “may”, “would”, “could”, “will”, “anticipate”, “believe”, “plan”, “expect”, “intend”, “estimate”, “potential for” and similar expressions, although these words may not be present in all forward-looking statements. Forward-looking statements that appear in this release may include, without limitation, references to: the Company’s right and ability to license its intellectual property to other third parties; the evaluation of new opportunities to further develop the Company’s intellectual property; the Company’s evaluation of additional licensing opportunities; the Company’s review and evaluation of further strategic alternatives for the business, including a corporate sale, merger or other business combination, a sale of all or a portion of the company’s assets, strategic investment or other significant transaction; the anticipated changes in management; the Company’s Annual Filing Documents and Q1 Filing Documents and the date that the Company expects to file same; the impact of the MCTO on the Company, its shareholders, directors and securities; the expected duration of the MCTO; the OSC’s response to the late filing of the Annual Filing Documents; and the Company continuing to issue bi-weekly default status reports.
These forward-looking statements reflect management’s current beliefs with respect to future events and are based on information currently available to management that, while considered reasonable by management as of the date on which the statements are made, are inherently subject to significant business, economic and competitive uncertainties and contingencies which could result in actions, events, conditions, results, performance or achievements to be materially different from those projected in the forward-looking statements. Forward-looking statements involve significant risks, uncertainties and assumptions and many factors could cause the Company’s actual results, performance or achievements to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements. Such factors and assumptions include, but are not limited to, the Company’s ability to retain key personnel; its ability to execute on its business plans and strategies, including the Strategic Transition; its ability to continue to license some or all its intellectual property to third parties and receive any material consideration; the sufficiency of its working capital to continue to fund its operations and avoid making any filing under the Bankruptcy and Insolvency Act (Canada) or the Companies’ Creditors Arrangement Act and other factors listed in the “Risk Factors” section of the Company’s Annual Report for the fiscal year ended December 31, 2021 (which may be viewed at www.sedar.com and at www.sec.gov). Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking statements prove incorrect, actual results, performance, or achievements may vary materially from those expressed or implied by the forward-looking statements contained in this news release. These factors should be considered carefully, and prospective investors should not place undue reliance on the forward-looking statements.
Although the forward-looking statements contained in the news release are based upon what management currently believes to be reasonable assumptions and the Company has attempted to identify important factors that could cause actual actions, events, conditions, results, performance or achievements to differ materially from those described in forward-looking statements, the Company cannot assure prospective investors that actual results, performance or achievements will be consistent with these forward-looking statements. Except as required by law, the Company expressly disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise. Accordingly, investors should not place undue reliance on forward-looking statements. All the forward-looking statements are expressly qualified by the foregoing cautionary statements.
Chief Financial Officer