Item 3.01. Notice of Delisting or Failure to Satisfy a Continued Listing Rule or
Standard; Transfer of Listing.
On July 8, 2020, VIVUS, Inc. (the "Company") received a letter from the listing
qualifications department staff of The Nasdaq Stock Market ("Nasdaq") notifying
the Company that, as a result of the filing of Chapter 11 Cases (as defined
below) and in accordance with Nasdaq Listing Rules 5101, 5110(b) and IM-5101-1,
Nasdaq has determined that the Company's securities - namely our common stock,
$0.001 par value per share ("Common Stock") and certain rights to purchase
specified units of the Company's Series A Participating Preferred Stock, $0.001
par value per share ("Series A Participating Preferred Stock") - will be
delisted from Nasdaq. This letter further indicates that, unless the Company
requests an appeal of this determination, trading of the securities will be
suspended at the opening of business on July 17, 2020 and a Form 25-NSE will be
filed with the Securities and Exchange Commission (the "SEC"), which will remove
the Company's securities from listing and registration on Nasdaq once the Form
becomes effective.
The Company does not intend to appeal the Nasdaq staff's determination and,
therefore, expects that the above-described securities will be delisted. The
Company expects that the securities therefore will become eligible to be quoted
on the OTC Bulletin Board or in the "Pink Sheets." The transition does not
affect the Company's operations and does not change reporting requirements under
certain provisions of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), and SEC rules thereunder.
As previously reported on Form 8-K, on July 7, 2020, the Company and all of its
subsidiaries (the "Debtors") filed voluntary petitions under chapter 11
("Chapter 11"), of Title 11 of the U.S. Code in the United States Bankruptcy
Court for the District of Delaware (the "Bankruptcy Court"). The Debtors have
filed a motion to have their Chapter 11 cases (collectively, the "Chapter 11
Cases") jointly administered under the caption In re VIVUS, Inc., et al.
Item 7.01. Regulation FD Disclosure.
In addition to filing the Chapter 11 Cases on July 7, 2020, the Debtors also
filed on that date a motion (the "Motion") seeking an interim order by the
Bankruptcy Court - which was granted by that Court on July 10, 2020 (the "NOL
Interim Order") - establishing certain procedures (the "Interim Procedures")
with respect to direct and indirect trading and transfers of stock of the
Company, and related relief, in order to protect the potential value of the
Company's net operating loss carryforwards and certain other tax benefits of the
Company. On July 8, 2020, the Debtors sought, and the Bankruptcy Court granted,
an emergency order which established similar procedures to the Interim
Procedures on an initial interim basis.
The Interim Procedures provide, among other things, to restrict transactions on
or after July 7, 2020 involving, and require notices of the holdings of and
proposed transactions by, any person or group of persons that is or, as a result
of such a transaction, would become, a Substantial Stockholder of the Common
Stock issued by VIVUS. For purposes of the Interim Procedures, a "Substantial
Stockholder" is any person or, in certain cases, group of persons that
beneficially own, directly or indirectly (and/or owns options to acquire) at
least 800,000 shares of Common Stock (representing approximately 4.5% of all
issued and outstanding shares of Common Stock as of April 30, 2020). Pursuant
to the Interim Procedures, any Substantial Stockholder must provide notice of
such person's or entity's substantial ownership on or before the date that is
the later of (x) 10 calendar days after the entry of the NOL Interim Order or
(y) 10 calendar days after such person or entity qualifies as a Substantial
Stockholder.
As set out in the Interim Procedures, prior to entering into certain
transactions for the acquisition or disposition of Common Stock, a person, or a
group of persons, may need to file a notice of the proposed transaction with the
Bankruptcy Court and serve such notice on the Debtors at least five business
days prior to the proposed transaction date. The Debtors will have three
business days after the filing of such notice to file an objection to the
proposed transaction. Any prohibited transfer of stock of the Company on or
after July 7, 2020, is null and void ab initio and may lead to contempt,
compensatory damages, punitive damages, or sanctions being imposed by the
Bankruptcy Court. A direct or indirect holder of, or prospective holder of,
stock issued by the Debtors should consult the Motion, the NOL Interim Order,
and the Interim Procedures set-out therein.
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Cautionary Note Regarding Forward-Looking Statements
Certain statements in this Current Report on Form 8-K are forward-looking within
the meaning of the Private Securities Litigation Reform Act of 1995 and other
provisions of the federal securities laws. Such forward-looking statements are
based on current expectations, management's beliefs and certain assumptions made
by the Company's management. These statements may be identified by the use of
forward-looking words such as "will," "shall," "may," "believe," "expect,"
"forecast," "intend," "anticipate," "predict," "should," "plan," "likely,"
"opportunity," "estimated," and "potential," and/or the negative use of these
words or other similar words. All forward-looking statements included in this
document are based on our current expectations, and we assume no obligation to
update any such forward-looking statements except to the extent otherwise
required by law or the Bankruptcy Court.
Important factors that could cause actual results to differ materially from
those anticipated in any forward-looking statement include, but are not limited
to: the delisting of the Company's securities from the Nasdaq Global Select
Market; and the eligibility of the Company's securities to be quoted on the OTC
Bulletin Board or in the "Pink Sheets."
These risks and uncertainties could cause actual results to differ materially
from those referred to in these forward-looking statements. The reader is
cautioned not to rely on these forward-looking statements. Investors also should
read the risk factors and accompanying cautionary statements set forth in the
Company's Form 10-Q for the first quarter ended March 31, 2020, as filed on May
6, 2020, Form 10-K for the fiscal year ended December 31, 2019, as filed on
March 3, 2020, and amended by the Form 10-K/A filed on April 29, 2020, and other
reports filed with, or furnished to, the SEC under the Exchange Act.
The above factors, risks and uncertainties are difficult to predict, contain
uncertainties that may materially affect actual results and may be beyond the
Company's control. New factors, risks and uncertainties emerge from time to
time, and it is not possible for management to predict all such factors, risks
and uncertainties. Although the Company believes that the assumptions underlying
the forward-looking statements contained herein are reasonable, any of the
assumptions could be inaccurate, and therefore any of these statements may prove
to be inaccurate. In light of the significant uncertainties inherent in the
forward-looking statements included herein, the inclusion of such information
should not be regarded as a representation by the Company or any other person
that the Company's objectives and plans will be achieved. These forward-looking
statements speak only as of the date such statements were made or any earlier
date indicated, and the Company does not undertake any obligation to update or
revise any forward-looking statements, whether as a result of new information,
future events, changes in underlying assumptions or otherwise, unless otherwise
required by law or the Bankruptcy Court.
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