UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report

(Date of Earliest Event Reported) ~~July~~May 92, ~~2020~~2019

VERTICAL COMPUTER SYSTEMS, INC.

(Exact name of registrant as specified in its charter)

Delaware		000-28685		65-0393635
(State or other jurisdiction of incorporation or organization)		(Commission File Number)		(I.R.S. Employer Identification No.)

101 West Renner Road, Suite 200, Richardson, Texas 75082

(Address of principal executive offices (zip code))

(972) 437-5200

(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐		Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐		Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐		Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐		Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock		VCSY		OTC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Item 8.01

Other Events

~~SEC~~Legal ~~Regulatory Orders and Actions~~Proceedings

On ~~July~~May 92, ~~2020~~2019, the ~~SEC~~Company ~~issued~~and anits ~~Order~~subsidiary, Now Solutions, Inc. (“Now Solutions”) were sued by Lakeshore Investments, LLC (“Lakeshore”) in the Superior Court of ~~Suspension~~the State of ~~Trading~~California in the County of Los Angeles. Lakeshore seeks damages in excess of $3 million dollars for allegedly failing to make outstanding payments on the ~~Company’s~~outstanding ~~shares~~balance due under a promissory note in the original principal amount of ~~Common~~approximately ~~Stock~~$1,759,150 ~~suspending~~that ~~trading~~was issued by Now Solutions to Lakeshore on January 13, 2013 (and amended to $2,291,395 million in ~~the~~December ~~Company~~2017), plus interest, attorney’s ~~securities~~fees ~~between~~and ~~July~~costs. 10On March 16, 2020, ~~and~~Lakeshore added ~~July~~Richard 23Wade as a defendant in the lawsuit. On December 18, 2019, Lakeshore filed a motion for summary judgment, which was denied on November 3, 2020. ~~The~~On ~~SEC~~September ~~has~~8, ~~not~~2020, ~~reinstated~~ the Company’s ~~right~~ and Now Solutions filed a motion for relief to ~~trade~~file ~~its~~a ~~stock~~cross-complaint against Lakeshore and Robert Farias (the owner of Lakeshore) seeking damages in excess of $5.5 million dollars. The ~~matter~~hearing date for this motion is ~~styled~~December In18, ~~the~~2020. ~~Matter~~This ofcase ~~Trans-Pacific~~is ~~Aerospace~~styled ~~Company~~Lakeshore Investments, ~~Inc~~LLC vs. ~~and~~Now Solutions, Inc., Vertical Computer Systems, Inc., ~~File~~et al , No. ~~500-1~~19/STCV15381.

~~Also,~~On onApril ~~July 9~~29, 2020, ~~the~~Richard ~~SEC~~Wade ~~commenced~~and anWilliam ~~administrative~~Mills, ~~proceeding~~former ~~against~~directors and corporate officers of the Company, ~~(In~~were served with a petition in the ~~Matter~~District Court of ~~Trans-Pacific~~the ~~Aerospace~~State ~~Company~~of Texas in Dallas County filed by Luiz Valdetaro, the Chief Technology Officer of the Company ~~Inc~~and several shareholders of the Company. The lawsuit includes a derivative action filed by certain shareholders on behalf of the Company against Mr. Wade and ~~Vertical~~Mr. ~~Computer~~Mills ~~Systems~~and seeks damages against both defendants for various breaches of fiduciary duties owed by them to the Company. In addition, ~~Inc~~Mr. Valdetaro seeks damages in excess of $425,000, ~~File~~plus Nopre and post judgment interest and court costs against Mr. ~~3-19864)~~Wade ~~pursuant~~and toMr. ~~Section~~Mills 12for damages incurred by Mr. Valdetaro under a settlement Mr. Valdetaro entered into with the Internal Revenue Service (jthe “IRS”) due to Now Solutions’ failure to pay payroll taxes to the IRS. The lawsuit alleges that Mr. Wade, who was the Chairman of the ~~Securities~~Board ~~Exchange~~of ~~Act~~Directors of ~~1934~~Now toSolutions until he was removed as an officer ~~decide~~and ~~whether~~director of Now Solutions on October 30, 2020, knowingly failed to ~~suspend~~pay funds due to the IRS for apayroll ~~period~~taxes ~~not~~owed toby ~~exceed~~Now ~~twelve~~Solutions and ~~months~~that orMr. ~~revoke~~Mills has joint and several liability to the ~~registration~~IRS ofand breached his fiduciary duties to the Company’s. ~~securities based~~On onAugust 26, 2020, the Company’s ~~failure~~was added as a nominal Plaintiff or necessary party to the ~~file~~lawsuit. ~~outstanding~~On ~~periodic~~September ~~reports~~13, ~~including~~2020, the District Court granted an ~~Annual~~injunction ~~Report~~prohibiting onMr. ~~Form~~Wade 10from using any debit cards of the Company or its subsidiaries for non-Kbusiness ~~with~~expenses ~~audited~~except under certain conditions, from writing checks or withdrawing ~~financials~~cash from the Company or any subsidiary bank accounts for personal expenses or personal obligations except under certain conditions, or from destroying, hiding or improperly altering any financial records of the ~~years~~Company ~~ended~~or ~~December~~any 31of its subsidiaries. The original petition was last amended by the plaintiffs on August 266, ~~2018~~2020. The trial date has been set for May 10, 2021. This case is styled Luiz Valdetaro, et al vs. Richard Wade and ~~2019~~William Mills, Esq., No. DC-20-06209 and ais ~~Quarterly~~ongoing. ~~Report~~The Board intends to retain outside legal counsel on ~~Form~~behalf ~~10-Q~~of ~~for~~the ~~each~~Company ~~quarter~~in order to determine its position in ~~2019~~this lawsuit and ~~2020~~take whatever action the Company believes is in the best interest of the Company and its shareholders.

On July 20, 2020, a Vertical shareholder filed a motion in the administrative proceeding seeking permission to file an amicus brief or statement of views requesting that, in lieu of revocation, the SEC suspend trading in Vertical’s securities for six months so that a group of shareholders could take certain corrective actions on behalf of the Company and all shareholders. On August 18, 2020, the SEC granted the shareholder’s motion to submit a statement of views. On August 26, 2020, the SEC’s Division of Enforcement filed a response asking the SEC to revoke Vertical’s registration. On October 30, 2020, the same Vertical shareholder filed a notice with the SEC providing an update on the progress the shareholders made in replacing Vertical’s management and to bring Vertical current on its required periodic filings.

The Company is not aware of any communications or actions taken by former directors and corporate officers Mr. Wade and Mr. Mills to address any matters raised by the SEC. The SEC website does not reflect that either Mr. Wade or Mr. Mills on behalf of the Company filed a response to the SEC administrative proceeding, and as of the date of this report, the Company has not received any formal communications from the SEC Division of Enforcement except for (i) the SEC acceptance of the amicus brief, and (ii) an indication that SEC does not accept the arguments set forth in the amicus brief.

The Company intends to resolve all outstanding matters with the SEC and take all necessary actions to do so as soon as possible. To that end, the Company is currently conducting its search for independent auditors. Once new auditors have been engaged, the Company will proceed to work with the auditors to file all annual, periodic and current reports that are delinquent as soon as possible so that the Company becomes current with all SEC reporting requirements. Once the Company is current with all its reporting obligations, the Company intends to hold its annual shareholder meeting as soon as reasonably practicable but no later than October 31, 2021.

Certain matters contained in this 8-K constitute forward-looking statements and are based upon management's expectations and beliefs concerning future events. There can be no assurance that the proposed transaction or these future events will occur as anticipated, if at all, or that actual results will be as expected. Forward-looking statements speak only as of the date they were made, and we undertake no obligation to publicly update them.

(d) Exhibits.

None

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Vertical Computer Systems, Inc. (Registrant)

	Vertical Computer Systems, Inc.
	(Registrant)

Date: November 6, 2020	By:	/s/ Len Chermack
		Len Chermack
		President/CEO

Date: November 4, 2020	By: /s/ Len Chermack
	Len Chermack
	President/CEO

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