Replies to post #126164 on Titan Medical Inc (TMDIF)

[BelizeMe]

Does The second condition mean they can pay off loan early after last milestone is completed at the end of summer/early fall 2021?

(ii) the completion of the last milestone under the Development Agreement,

Without a buyout offer after the last
milestone what would be the reason to allow a company to have a gag order on you when you have cash to pay them off? After paying off the loan, the company could actually PROMOTE the company and technology and garner interest from other potential companies.

Would McNally really allow MDT to keep a gag on them until FDA clearance without any guarantee or additional funds infused?

BelizeMe

[66Mustang]

Not sure what the concern is here. "Due and Payable In Full" does not preempt an earlier payment. Like tomorrow, if they wanted. But it is Due on the earliest of those 3 things, and one is a fixed date - so if the other 2 things don't happen by that date, they owe Medtronic the described sum on June 23, 2023. If they complete the last milestone under the development agreement before then (isn't that the "September Milestone", as it has been colloquially referred to?) then we would owe them the specified sum at that time (or possibly just ask them to withhold that amount from our final milestone payment). The third condition is a change of control, which means to me that if JnJ or anyone else steps in and buys us out of the blue, MDT gets their money back.

A Due Date means that's the latest it is due, it does not mean it can't be done earlier. Ever borrow a book from the library? Ever been charged a fee for bringing it back too early? Nope. They don't do that because that isn't what "Due" means.

What it does mean in this case is that the handcuffs are off as of June 2023 at the latest, if milestones could possibly be dragged out that far and if there is no change of control by then (for whatever reason).


Message in reply to:
A couple interesting notes from MDT license agreement:

Regarding the $1.5 million secured loan from MDTA:

The unpaid principal balance owing under the Note, together with any accrued and unpaid interest and all other unpaid obligations under the Note, shall be due and payable in full on the earliest to occur of: (i) June 4,
2023, (ii) the completion of the last milestone under the Development Agreement, or (iii) a Change of Control
(as defined in the Note), subject to an accelerated due date under certain adverse conditions. Until
repayment of the loan, Medtronic may have one non-voting observer attend meetings of Titan’s Board of
Directors.

HOW DO PEOPLE INTERPRET THAT UNDERLINED PHRASE? TITAN CAN'T PAY OFF THE LOAN EARLY? IF SO THAT HAND CUFFS TITAN THRU JUNE 2023 FROM PROMOTING TITAN EVEN AFTER COMPLETING MDT AGREEMENT/MILESTONES AND RECEIVING FINAL PAYMENTS (WITHOUT ANY FURTHER COMMITMENT FROM MDT NEEDED). THAT'S 2 YEARS OF ADD'L SILENCE IF NO BO.