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In July 2020, PDL issued its proxy statement that requested approval by its stockholders of a Plan of Dissolution as the most efficient manner of winding up the Company’s business, paying and making provision to pay its creditors, and distributing the proceeds of its liquidation process to its stockholders pursuant to the Plan of Dissolution.
At PDL’s 2020 Annual Meeting of Stockholders on August 19, 2020, PDL’s stockholders approved the Plan of Dissolution and authorized the PDL Board of Directors (“the Board”) to direct the officers of the Company to file a certificate of dissolution with the State of Delaware (the “Certificate of Dissolution”) upon the Board’s determination that such a filing was in the best interests of PDL’s stockholders.
Following a resolution by PDL’s Board at its November 5, 2020 meeting, PDL filed the Certificate of Dissolution on January 4, 2021. Please refer to the Plan of Dissolution in PDL’s Proxy Statement for a detailed discussion of dissolution, but note the following:
- PDL will continue its existence for at least three years after filing the Certificate of Dissolution, or such longer period as the Delaware Court of Chancery may direct, for the purpose of prosecuting and defending suits, settling and closing its business, disposing of and conveying its property, discharging its liabilities and distributing to its stockholders any remaining assets.
- Before distributions are made to PDL’s stockholders, PDL will follow the procedures found in the Plan of Dissolution and Sections 280 and 281(a) of the Delaware General Corporate Law (DGCL) (the “Safe Harbor Procedures”) that, in summary, provide that the Company may give notice of PDL’s dissolution to potential claimants, accept or reject claims received, and offer a security for payment of contingent or unmatured contractual claims. Generally, the Safe Harbor Procedures reduce the potential liability of the Company’s stockholders and directors from future claims related to distributions made in liquidation. In accordance with the Safe Harbor Procedures, after giving notice to holders of current, contingent and likely unknown claims and otherwise complying with the Safe Harbor Procedures to resolve those claims, PDL petitioned the Delaware Court of Chancery to determine the amount and form of security that will be sufficient to pay known pending claims, contingent or unmatured contract claims, and unknown claims that are likely to arise based on facts known to PDL pursuant to the time periods and parameters set forth in the Plan of Dissolution and the DGCL. After PDL completed the claims resolution process under the Safe Harbor Procedures, PDL filed a Verified Petition For Determination Pursuant to 8 Del. C. Sec 280(c) on February 10, 2022. Subsequently, PDL filed a Motion for First Interim Distribution to Stockholders, which motion was granted by the Delaware Chancery Court on May 10, 2022. In its order, the Court has required that the Company retain a security of $93,208,494 against future liabilities and expenses. On May 13, 2022, the Company made a cash distribution of $1.00/share to its stockholders of record as of January 4, 2021.
- As announced on December 8, 2020, the voluntary suspension of trading and subsequent delisting of PDL’s common stock (Nasdaq: PDLI) occurred prior to market opening on December 31, 2020. The Company’s transfer books closed as of the filing of the certificate of dissolution on January 4, 2021 (the “Final Record Date”). After the Final Record Date, the Company will not record any further transfers of its common stock, except such transfers occurring by will, intestate succession, or by operation of law as to which PDL has received adequate written notice, and PDL will not issue any new stock certificates, other than replacement certificates. In addition, after the Final Record Date, the Company will not issue any shares of its common stock upon exercise of outstanding stock options. As a result of the closing of PDL’s transfer books, distributions made in connection with the Plan of Dissolution are made pro rata to the stockholders of record as of the Final Record Date, and it is anticipated that no further trading of the Company’s common stock will occur after the Final Record Date of January 4, 2021.
The following Q&A is intended to help answer questions about the delisting of the PDL BioPharma, Inc.’s (“PDL” or the “Company”) stock and Plan of Dissolution. If you do not find a response to the question(s) you have, please feel free to reach out to us at: http://investor.pdl.com.
Additionally, the responses below as well as the investor updates issued by the Company should be read in conjunction with the filings submitted to the Securities and Exchange Commission (the “SEC”) that address these and other matters and are not intended to modify those disclosures. You can find this information at: http://investor.pdl.com/ or at https://www.sec.gov/cgi-bin/browse-edgar?CIK=882104&owner=exclude.
Our 2020 Proxy Statement, which describes the dissolution process, can be found at:
https://www.sec.gov/Archives/edgar/data/882104/000088210420000100/pdli-20200707def14adoc.htm.
Our 2020 Form 10-K, which was filed with the SEC on March 29, 2021, may be found at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/0000882104/000088210421000035/pdli-20201231.htm.
Our most recent investor update dated March 29, 2021 as well as our 2020 Proxy Statement and 2020 Form 10-K may also be found at http://investor.pdl.com.