Item 2.05 Costs Associated with Exit or Disposal Activities.
As previously disclosed on November 14, 2022, Allied Healthcare Products, Inc.
(the "Company" or "Allied") experienced significant losses and negative cash
flow for the three months ended September 30, 2022. The Company experienced a
loss of $1.6 million before taxes for the quarter, compared to a loss of $1.0
million before taxes for the prior year period, and used $2.1 of cash in
operating activities. Also as previously announced, on December 19, 2022, the
Company's Board of Directors (the "Board") approved a reduction in force
involving substantially all of the Company's St. Louis production employees (the
"Reduction in Force"). In response to these circumstances, on January 25, 2023,
the Board approved a plan of disposal of all or substantially all of the assets
of the Company (the "Disposition Plan"). The Board has engaged the firm of
Morris Anderson to manage the sale of the assets.
As previously disclosed, the Reduction in Force will trigger withdrawal
liabilities owed to certain multiemployer pension plans which were recently
estimated by such pension plans to be $17.5 million, although the actual
withdrawal liability is not likely to be known until the conclusion of any and
all appeal processes. The Company's other material liabilities include
approximately $865,000.00 of aggregate principal amount outstanding under the
Company's Loan and Security Agreement with North Mill Capital, LLC, as successor
in interest to Summit Financial Resources, L.P. and $14.7 million of rent due
for the remainder of the term of that certain Commercial Lease by and between
the Company and Fyler Storage Properties, LLC.
The Company expects that it will incur material additional costs in association
with actions that are contemplated pursuant to the Disposition Plan, which could
include the impairment of assets, severance pay to employees and professional
fees, however, the Company is unable at this time to estimate the full amount of
such costs which may be incurred. The Company will file an amendment to this
Form 8-K within four business days after it determines an estimate or range of
estimates of these costs associated with the Disposal Plan.
Item 3.01 Notice of Delisting or Failure to Satisfy a Continued Listing Rule or
Standard; Transfer of Listing.
As previously disclosed, on November 23, 2022, the Company received written
notice from the Listing Qualifications Department of The Nasdaq Stock Market
("Nasdaq") notifying the Company that, as a result of its delay in filing its
Form 10-Q for the quarter ended September 30, 2022, it was no longer in
compliance with Nasdaq Listing Rule 5250(c)(1). The Company was given a period
of 60 days from its receipt of the notice to submit a plan to regain compliance
with the Nasdaq Listing Rules.
On January 25, 2023, Nasdaq notified the Company that, because of the Company's
failure to submit a compliance plan and its inability to file the late quarterly
report, it has determined to delist the stock. The Company does not intend to
appeal this decision and the delisting is expected to be effective at the
opening of business on February 3, 2023, at which time trading in the Company's
stock will be suspended.
Item 8.01 Other Events
Due to the adoption of the Disposal Plan, the Board has determined to
indefinitely postpone the Company's 2022 Annual Meeting of Stockholders, which
was originally scheduled for November 9, 2022, and was adjourned until December
9, 2022, and further adjourned until January 9, 2023.
Because of the postponement of the 2022 Annual Meeting, the due date for the
provision of any qualified stockholder proposal under the rules of the
Securities and Exchange Commission (the "SEC") (June 14, 2023) described in the
Company's 2022 Definitive Proxy Statement will no longer be applicable. In the
event the Board determines it advisable to hold the 2022 Annual Meeting, the
Company will notify stockholders of the new meeting date and the due date by
which any qualified stockholder proposals should be submitted. Any such notice
will be provided in accordance with state law, the Company's By-Laws and the
requirements of the SEC.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits. The following exhibit index lists the exhibits that are either
filed or furnished with this Current Report on Form 8-K.
99.1 Press Release of the Company dated January 26, 2023.
104 Cover Page Interactive Data File (embedded within the Inline XBRL
document)© Edgar Online, source Glimpses
ALLIED HEALTHCARE PRODUCTS, INC. 
