Radient Pharmaceuticals gets more default notices on preferreds, notes

Investors seek redemptions, damages; company says it is unable to pay

By Devika Patel

Knoxville, Tenn., April 3 - Radient Pharmaceuticals Corp. has received additional default notices under its $4.98 million of 2011 notes, according to an 8-K filed Wednesday with the Securities and Exchange Commission.

The company had reported on March 28 that three noteholders notified the company of the default between March 26 and March 28 and exercised their right to force redemption. These investors hold about $3.31 million of notes, 246,358 series B preferreds and 33,092 series C preferreds.

Since then, all but one investor has informed the company of the default. That one investor holds $1.58 million of notes.

The delisting of the company's common stock from the OTCQX tier of the OTC Markets constitutes an event of default under the notes and also constitutes a triggering event under the company's series B and series C preferred stock, which may require the company to redeem the preferreds.

As previously reported, the company said in a Feb. 23 8-K filing that it has "a severe working capital shortage" and is unable to pay its ordinary obligations. It noted in the February filing that it is seeking additional financing.

The company noted that, due to its lack of working capital, it will be unable to pay the redemption prices.

If it is unable to pay the balance, Radient noted in the previous filing, it will be required to pay late charges on the notes of 24% per year until the redemption price is fully paid. On the preferreds, the company will have to pay 2% interest each month for each unredeemed preferred until the redemption price is paid in full.

The investors also seek $6.5 million of damages due to "breaches of fiduciary duties of care, loyalty, good faith and disclosure, self dealing and waste and spoliation of corporate assets," the company reported in the filing.

Based in Tustin, Calif., Radient is a developer and marketer of In Vitro Diagnostic Onko-Sure cancer tests.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.