Titan Medical Inc. (“
Titan”) (TSX: TMD; OTC: TMDIF) is
pleased to announce that, in connection with its amalgamation
agreement (“
Amalgamation Agreement”) with Conavi Medical
Inc. (“
Conavi”) providing for the combination of the
companies in an all-stock transaction (the “
Transaction”),
Conavi has closed its previously announced concurrent private
placement of subscription receipts (“
Subscription Receipts”)
for gross proceeds of US$7.7 million (the “
Offering”).
Pursuant to the Offering, Conavi issued
7,729,300 Subscription Receipts (7,526,025 of which were issued in
a brokered portion of the Offering, with the remainder in a
concurrent, non-brokered private placement) at a price of US$1.00
per Subscription Receipt to certain institutional and accredited
investors, including Conavi’s lead investors and principal
shareholders, Carlyle Services Limited Liability Company, CPOINT
Capital Corp. and Juno Pharmaceuticals LP. The brokered portion of
the Offering was led by Bloom Burton Securities Inc. (the
“Agent”) as exclusive agent and financial advisor. Each
Subscription Receipt shall entitle the holder to receive, upon
satisfaction of certain escrow release conditions (including
satisfaction or waiver of the closing conditions to the
Transaction) ("Escrow Release Conditions"), and without
payment of additional consideration, one unit in the capital of
Conavi consisting of one voting common share in the capital of
Conavi (each, a “Conavi Share”) and one warrant of Conavi
(each, a “Conavi Warrant”) to purchase one Conavi Share at
an exercise price of US$1.25 per Conavi Share. At the effective
time of the completion of Conavi’s proposed reverse take-over of
Titan (“Closing”), as described in the press releases of
Titan dated March 18, 2024, with subsequent amendments to the
Amalgamation Agreement announced on May 29, 2024, July 5, 2024 and
August 14, 2024, each Conavi Share and Conavi Warrant acquired upon
conversion of the Subscription Receipts will be automatically
exchanged and adjusted, on the basis of the Exchange Ratio (as
defined in the Amalgamation Agreement) for equivalent securities in
the capital of the reporting issuer resulting from the completion
of the Transaction (the "Resulting Issuer"), being common
shares in the capital of the Resulting Issuer (each a "Resulting
Issuer Share") and common share purchase warrants of the
Resulting Issuer (each whole common share purchase warrant, a
"Resulting Issuer Warrant"). The Resulting Issuer Warrants
will expire five years after completion of the Transaction.
In connection with the Offering, the Agent is
entitled to a cash fee equal to 7.0% of the gross proceeds in
respect of the brokered portion of the Offering. As additional
compensation, the Agent has been issued 35,329 broker warrants (the
“Broker Warrants”). Each Broker Warrant shall be exercisable
for purchase of one Conavi Share at a price of US$1.00 per Conavi
Share for 24 months following Closing of the Transaction, and will
be automatically exchanged and adjusted, on the basis of the
Exchange Ratio (as such term is defined in the joint management
information circular for the Transaction dated August 30, 2024,
which may be viewed under Titan’s profile at www.sedarplus.com)
(the “MIC”), for broker warrants of the Resulting Issuer.
Notwithstanding the foregoing, the Agent did not receive Broker
Warrants with respect to subscriptions from Carlyle Services
Limited Liability Company, CPOINT Capital Corp. and Juno
Pharmaceuticals LP, and the Agent’s cash fee entitlement is 3.5% of
the gross proceeds raised from such subscriptions.
The net proceeds of the Offering and 50% of the
Agent’s cash fee are being held in escrow and, upon the
satisfaction or waiver of the Escrow Release Conditions, the net
proceeds will be released to Conavi and the remaining portion of
the Agent’s cash fee will be released to the Agent.
Additional details of the Offering, including
the terms of share consolidations to be carried out by each of
Titan and Conavi, and additional details concerning the terms of
the Transaction and the Exchange Ratio, are disclosed in the
MIC.
Conavi intends to use the proceeds of the
Offering for product research and development and production
activities for Novasight 3.0, ongoing commercialization activities,
and for working capital and general corporate purposes.
The securities described herein have not been,
and will not be, registered under the U.S. Securities Act of 1933,
as amended (the "U.S. Securities Act") or any U.S. state
securities laws and may not be offered or sold in the United States
absent registration or an available exemption from the registration
requirements of the U.S. Securities Act and applicable U.S. state
securities laws. This press release shall not constitute an offer
to sell or the solicitation of an offer to buy, nor shall there be
any sale of the securities referenced in this press release, in any
jurisdiction in which such offer, solicitation or sale would be
unlawful.
The closing of the Transaction, which is subject
to the satisfaction or waiver of a number of customary closing
conditions, is expected to take place on or around October 11,
2024. In connection with closing of the Transaction, Titan is
expected to change its name to Conavi Medical Corp. and to complete
a 25-to-1 share consolidation. In addition, further to its press
release dated, September 30, 2024, Titan intends to voluntarily
delist from the Toronto Stock Exchange (“TSX”) and to apply
to re-list its shares on the TSX Venture Exchange
(“TSXV”).
Following Closing, it is expected that Titan’s
shares will continue to trade on a pre-consolidation and
pre-Transaction basis for two or three business days following
Closing of the Transaction while the parties seek the final
approval of the TSX and the TSXV. Upon receipt of such approvals,
Titan’s common shares are expected to be delisted from the TSX
effective as of close of markets on or around October 16, 2024.
Titan has received conditional approval from the TSXV for the
listing of the Resulting Issuer Shares under the symbol
“CNVI”, and subject to final approval of the TSXV, trading
on the TSXV (which will give effect to Titan’s name change, 25-to-1
share consolidation and Closing of the Transaction) is expected to
commence immediately on the trading day following delisting from
the TSX without any interruption in trading. A further update
regarding the process of delisting from the TSX and relisting on
the TSXV will be provided upon Closing of the Transaction.
About Titan Medical
Titan Medical Inc. (TSX: TMD; OTC: TMDIF), a
medical technology company incorporated under the Business
Corporations Act (Ontario) and headquartered in Toronto, Ontario,
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.
About Conavi Medical
Conavi Medical Inc. is a privately-owned company
focused on designing, manufacturing, and marketing imaging
technologies to guide common minimally invasive cardiovascular
procedures. Its patented Novasight Hybrid™ System is the first
system to combine both IVUS and OCT to enable simultaneous and
co-registered imaging of coronary arteries. The Novasight Hybrid
System has 510(k) clearance from the U.S. Food and Drug
Administration; and regulatory approval for clinical use from
Health Canada, China’s National Medical Products Administration,
and Japan’s Ministry of Health, Labor and Welfare. For more
information, visit http://www.conavi.com/.
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 Titan’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 continued work of Titan and Conavi
towards the completion of the Transaction.
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 Titan’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, Titan’s ability to retain key
personnel; its ability to execute on its business plans and
strategies; its ability to continue to license some or all its
intellectual property to third parties and receive any material
consideration; the satisfaction of the Escrow Release Conditions;
the receipt of final required approvals from the TSX Venture
Exchange in connection with the Transaction or change of listing
and the timing thereof; the successful completion of the
Transaction and other factors listed in the “Risk Factors” sections
of Titan’s Annual Information Form for the fiscal year ended
December 31, 2023 and the MIC (which may be viewed at
www.sedarplus.com). 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 Titan 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, Titan cannot assure prospective investors that actual
results, performance or achievements will be consistent with these
forward-looking statements. Except as required by law, Titan
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.
Contacts
Titan Medical Inc.Chien HuangChief Financial
Officerinvestors@titanmedicalinc.com
Conavi Medical Inc.Stephen KilmerInvestor Relations(647)
872-4849stephen@kilmerlucas.com
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