Vion Pharmaceuticals out of bankruptcy; liquidation plan takes effect

By Caroline Salls

Pittsburgh, April 9 - Vion Pharmaceuticals, Inc. emerged from Chapter 11 bankruptcy when its plan of liquidation took effect on Thursday, according to an 8-K filed with the Securities and Exchange Commission.

The plan was confirmed on Wednesday by the U.S. Bankruptcy Court for the District of Delaware.

As previously reported, under the plan Vion's remaining assets, which consist mainly of sale proceeds, will be transferred to a liquidating trust and distributed to creditors.

Creditor treatment will include:

• Holders of administrative claims, priority tax claims and priority claims will recover 100% in cash;

• Holders of secured claims will recover 100% either in cash or through the return of the collateral securing the claim;

• Holders of general unsecured claims, including notes claims, will recover 13% to 17% through a share of distributable cash; and

• Holders of interests and interest-related claims arising from common stock will receive no distribution.

According to the 8-K, the company filed a cease trading request on Thursday with the Financial Industry Regulatory Authority. As a result, Vion said its common stock will cease trading and be removed from the OTC quotation systems list.

As of the plan effective date, Vion's board of directors was dissolved and its officers discharged.

Vion, a New Haven, Conn., drug development company, filed for bankruptcy on Dec. 17. Its Chapter 11 case number is 09-14429.

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