Mr. Paul Cataford reports
TITAN MEDICAL ANNOUNCES CORPORATE UPDATE AND PROVIDES BI-WEEKLY MCTO STATUS UPDATE
Titan Medical Inc. has provided 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.
As a result of the strategic review process announced on Nov. 30, 2022, the board of directors of Titan has approved a 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 and, as announced on Jan. 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 co-operated 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 licence 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 chief executive officer. 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 continuing 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 Mr. 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 noard."
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 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 Dec. 31, 2022. 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. 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 biweekly default status reports as required.
About Titan Medical Inc.
Titan Medical, a medical technology company headquartered in Toronto, Ont., with operations in Chapel Hill, N.C., 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.
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