Subsequent Events |
12 Months Ended | |
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Dec. 31, 2018 | ||
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| Subsequent Events [Text Block] |
Note 12 – Subsequent Events Litigation In connection with the SPMA, two putative class action lawsuits were filed in the United States District Court for the District of Delaware. The two lawsuits are captioned
Bushansky v. Avenue Therapeutics, Inc. et al, Docket No. 1:19-cv-00085 (D. Del. Jan 15, 2019) and
Krause v. Avenue Therapeutics, Inc. et al, Docket No. 1:19-cv-00107 (D. Del. Jan 17, 2019) (collectively, the “
Merger Litigation ”). The complaints, which were filed by purported Company stockholders, generally allege that the preliminary and definitive proxy statements that the Company filed with the SEC on December 11, 2018 and December 21, 2018, respectively, omitted certain material information in connection with the Stock Purchase Transaction and the Merger Transaction in violation of Sections 14(a) and 20(a) of the Securities Exchange Act of 1934, and SEC Rule 14a-9 thereunder. These complaints include demands for, among other things, an order enjoining defendants from closing the Stock Purchase Transaction and the Merger Transaction absent certain disclosures of information identified in the complaints.
The Company believes that the claims asserted in the Merger Litigation are without merit and that no supplemental disclosure was required under applicable law. However, in order to avoid the risk of the Merger Litigation delaying or adversely affecting the SPMA and to minimize the costs, risks and uncertainties inherent in litigation, and without admitting any liability or wrongdoing, the Company determined to voluntarily supplement the Proxy Statement it filed with the SEC on December 21, 2018. Nothing in the supplement to the proxy was deemed an admission of the legal necessity or materiality under applicable laws of any of the disclosures set forth within the supplement to the Proxy Statement. To the contrary, the Company specifically denied all allegations in the Merger Litigation that any additional disclosure was required. SPMA The SPMA was approved by a majority of the Company’s stockholders, including a majority of its non-affiliated stockholders, at its special shareholder meeting on February 6, 2019. On February 8, 2019, InvaGen acquired 5,833,333 shares of the Company’s common stock at $6.00 per share for net proceeds of $31.5 million after deducting commission fees and other offering costs, representing a 33.3% stake in the Company’s capital stock on a fully diluted basis.
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