Monster Digital announces significant
corporate developments/potential delisting of common
stock/settlement with Monster, Inc.
Monster Digital, Inc. ("Monster Digital" or the "Company")
announced today several material events:
Extension of Outside Closing Date for Merger.
Monster Digital and Innovate Biopharmaceuticals, Inc. ("Innovate")
today announced that they have agreed to extend the outside closing
date (the "Closing") of their previously announced reverse merger
("Merger"). The Company and Innovate had originally planned to
close the transaction by January 3, 2018 but the final preparations
for the Closing are taking more time than expected. The Company and
Innovate have amended the merger agreement to provide the outside
termination date for the Merger will be January 26, 2018.
As previously disclosed, following the Closing, Innovate will
become a wholly owned subsidiary of Monster Digital, and Monster
Digital, as the parent of the surviving company, will be renamed
"Innovate Biopharmaceuticals, Inc." Innovate stockholders will own
the substantial majority of shares of the combined company after
the transaction. The common stock shares of the combined company
will trade under the symbol INNT.
As previously disclosed, immediately prior to the effective time
of the Merger, there will be a spin-off transaction (the
"Spin-Off"). Previously, all of the business, assets and certain of
the liabilities of Monster that are not assumed by Innovate in
connection with the Merger were transferred into a wholly-owned
subsidiary of the Company, MD Holding Co., Inc. ("Holdco"). Further
to the Spin-Off, holders of record of the Company's common stock
immediately prior to the effective time of the Merger will receive
a pro rata distribution of one share of Holdco's private company
common stock for each share of Monster common stock held.
“We are actively engaged with Innovate and remain committed to
the reverse merger. We continue to work diligently and
cooperatively with Innovate to close the transaction as soon as
possible,” said David Clarke, CEO of Monster Digital. Commenting on
the Merger, Innovate's CEO Christopher P. Prior, Ph.D., stated: "We
are working closely with Monster Digital towards the Closing."
Monster Digital announces significant corporate
developments
Potential for Common stock to be delisted.
Monster Digital today announced that it has determined that it will
be unable to regain compliance for continued listing of its common
stock on the NASDAQ Capital Market by the previously reported
January 3, 2018 deadline set by The NASDAQ Stock Market LLC
Hearings Panel (the “Panel”).While the Company has been working
diligently with Innovate to complete the Merger, the Company and
Innovate, as reported above, have determined that they will be
unable to achieve these objectives prior to the January 3, 2018
deadline.
The Company has requested that the Panel grant a further
extension of the deadline until January 26, 2018. The Company can
give no assurance that the Panel will grant such an extension. If
the Panel does not grant the Company’s requested extension, based
on the listing requirements of NASDAQ, the Company’s common stock
will be delisted from the Nasdaq Capital Market. The Company's
common stock is currently traded on the NASDAQ Capital Market under
the trading symbol “MSDI.” The Company has filed an application and
is taking the steps necessary to have its common stock quoted for
trading in the OTCQB US Market (“OTCQB”), operated by OTC Markets,
Inc., under the same trading symbol of “MSDI.” The Company expects
to hear back from the Panel by the end of this week, but cannot
give any assurance that a decision will be reached by then. If the
Panel does not grant an extension and the Company’s common stock is
delisted from the NASDAQ Capital Market, trading will commence on
the OTCQB the next trading day.
To the extent that the Company’s common stock is delisted and
following commencement of trading of its common stock on the OTCQB,
the Company’s common stock will continue to be registered under the
Exchange Act and the Company will continue to file financial
reports that will be available on the SEC's
website, www.sec.gov.
Settlement Agreement with Monster, Inc. Monster
Digital and Monster Inc., (formally known as Monster Cable
Products, Inc.) announced that they have entered into a settlement
agreement providing for the early termination of the License
Agreement for the “Monster” names and trademarks. Pursuant to the
new understanding, Monster Digital will cease using the Monster
names and trademarks on or before February 1, 2018. Terms of the
settlement were not disclosed.
About Monster Digital, Inc.
Monster Digital develops, markets and distributes
Monster-branded products for use in high-performance consumer
electronics, mobile products and computing applications. The
Company designs and engineers premium action sports cameras and
accessories, in addition to advanced data storage and memory
products for professionals and consumers.
Monster Digital is a registered trademark of Monster Products,
Inc. in the U.S. and other countries.
For more information about the company, please
visit http://www.monsterdigital.com
About Innovate Biopharmaceuticals, Inc.:
Innovate is a clinical stage biotechnology company focused on
developing novel autoimmune/inflammation therapeutic drugs.
Innovate's lead drug candidate, larazotide acetate (INN-202),
has successfully met its primary endpoint in an efficacy clinical
trial for celiac disease. Larazotide successfully completed the End
of Phase 2 Meeting with the FDA to prepare for expected Phase 3
clinical trials for larazotide in celiac disease in 2018. In
clinical studies in more than 800 patients, larazotide demonstrated
a favorable safety profile comparable to placebo, due to what
Innovate believes is its lack of systemic absorption from the small
bowel. Larazotide has received Fast Track designation from the
FDA.
Larazotide, an oral peptide formulated into a capsule, has a
mechanism of action that decreases intestinal permeability and
regulates tight junctions by reducing antigen trafficking across
epithelial cells in the intestines. Innovate believes that
larazotide is the only drug in the clinic with this mechanism of
action of reducing intestinal permeability. Increased intestinal
permeability, sometimes referred to as "leaky gut," has been widely
recognized in the literature as a gateway to multiple autoimmune
diseases, including celiac disease, irritable bowel syndrome (IBS),
inflammatory bowel diseases (IBD, Crohn's and ulcerative colitis),
type 1 diabetes mellitus (T1DM), nonalcoholic steatohepatitis
(NASH), chronic kidney disease (CKD) and several others.
For more information, please
visit http://www.innovatebiopharma.com
Forward-Looking Statements: Some of the
statements in this press release are "forward-looking" and are made
pursuant to the safe harbor provision of the Private Securities
Litigation Reform Act of 1995. Actual results and the timing of
events could differ materially from those anticipated in such
forward-looking statements as a result of risks and uncertainties
including: the risk that the Merger may not be completed in the
anticipate time frame or at all, which may adversely affect the
price of the common stock of the Company; the failure to satisfy
any of the conditions to the consummation of the Merger; the risk
that Monster Digital’s common stock will be delisted from Nasdaq;
and the occurrence of any event, change or other circumstance that
could give rise to the termination of the merger agreement .
These statements involve risks and uncertainties that may cause
results to differ materially from the statements set forth in this
press release, including, among other things, our ability to obtain
and maintain regulatory approval for our products; plus other
factors described under the heading "Item 1A. Risk Factors" in our
Annual Report on Form 10-K for the fiscal year ended December 31,
2016 or described in our other public filings. Our results may also
be affected by factors of which we are not currently aware. The
forward-looking statements in this press release speak only as of
the date of this press release. Monster Digital expressly disclaims
any obligation or undertaking to release publicly any updates or
revisions to such statements to reflect any change in its
expectations with regard thereto or any changes in the events,
conditions or circumstances on which any such statement is
based.
Contacts: Monster Digital, Inc. David Olert CFO
dolert@monsterdigital.com Investors: PCG Advisory
Vivian Cervantes 646-863-6274 vivian@pcgadvisory.com
Innovate Biopharmaceuticals, Inc. Kendyle Woodard
919-275-1933 investor.relations@innovatebiopharma.com
Innovate Biopharmaceutic... (NASDAQ:INNT)
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