Delisting of Protein Polymer Common Stock from Quotation On the Nasdaq
Stock Market
SAN DIEGO, Sept. 21 -- Protein Polymer Technologies,
Inc. (Nasdaq: PPTI) reports today that it received notification from the
Nasdaq Listing Qualifications Panel that the panel had determined to delist
the Company's common stock from quotation on The Nasdaq Stock Market effective
with the close of business yesterday, September 20, 1999, due to the Company's
failure to meet the net tangible assets and minimum bid price maintenance
criteria for continued listing.
The Company's common stock may be eligible to trade on
the OTC Bulletin Board. Rule 15c2-11 under the Exchange Act specifies
certain information that broker-dealers are required to maintain regarding
securities traded in the over-the counter markets. An exemption from
Rule 15c2-11 has been granted under certain circumstances to permit a broker-dealer,
without having the information specified by Rule 15c2-11, to publish in,
or submit for publication in, a quotation medium, quotations for a security
immediately after such security has been delisted from The Nasdaq Stock
Market. In addition, as a consequence of the delisting, the Company's
common stock may become subject to regulation as a "penny stock."
The Securities and Exchange Commission has adopted regulations which generally
define "penny stock" to be any equity security that has a market price or
exercise price less than $5.00 per share, subject to certain exceptions,
including listing on the Nasdaq SmallCap Market. If no other exception
applies, the Company's common stock may become subject to the SEC's Penny
Stock Rules, Rule 15g-1 through Rule 15g-9 under the Exchange Act.
For transactions covered by these rules, broker-dealers must make a special
suitability determination for the purchase of such securities and must have
received the purchaser's written consent to the transaction prior to the
purchase. Additionally, for any transaction involving a penny stock,
unless exempt, the rules require the delivery, prior to the transaction,
of a risk disclosure document mandated by the SEC relating to the penny
stock market. The broker-dealer must also disclose the commission
payable to both the broker-dealer and the registered representative, current
quotations for the securities and, if the broker-dealer is the sole market
maker, the broker-dealer must disclose this fact and the broker-dealer's
presumed control over the market. Finally, monthly statements must
be sent disclosing recent price information for the penny stock held in
the account and information on the limited market in penny stocks.
Rule 15g-9 under the Exchange Act imposes additional sales practice requirements
on broker dealers who sell such securities except in transactions exempted
from such rule. Such exempt transactions include those meeting the
requirements of Rule 505 or 506 of Regulation D promulgated under the Securities
Act and transactions in which the purchaser is an institutional accredited
investor or an established customer of the broker dealer.
The Company has completed a subsequent closing of a private
placement of its Series G Convertible Preferred Stock with a small group
of accredited and institutional investors. Together with the initial
closing previously announced on August 17, 1999, PPTI received approximately
$2.1 million. Each share of Series G Preferred Stock was priced at
$100 per share and can be converted at any time by the holder into common
stock at conversion price of $0.50 per share, subject to certain antidilution
adjustments. Each share of Series G Preferred Stock also received
a common stock warrant, exercisable for 12 months, that allows the holder
to acquire 200 shares of PPTI common stock at an exercise price of $0.50
per share. The Series G Preferred Stock, warrants and underlying common
stock have not been registered under the Securities Act of 1933, as amended,
and may not be offered or sold in the United States absent registration
or an applicable exemption from registration requirements. The proceeds
will enable the Company to begin human clinical testing scheduled to begin
this fall of the Company's lead product, an injectable treatment for female
stress urinary incontinence.
Protein Polymer Technologies, Inc., a San Diego based
biotechnology company, has developed a protein-based technology platform
that allows creation of new biomaterials which target multiple applications
in biomedical markets. The different classes of biocompatible polymers
developed by PPTI have been genetically engineered to enable cell growth,
promote the regeneration of tissue, bond to synthetic surfaces and resorb
into tissue at controlled rates. Targeted applications include tissue
adhesives and sealants, tissue augmentation, wound healing and drug delivery
vehicles.
