T2 Biosystems Receives Extension to Comply with Nasdaq Listing Requirement

Rhea-AI Summary

T2 Biosystems, Inc. (TTOO) secures continued listing on Nasdaq Stock Market after Nasdaq Hearings Panel grants extension for compliance with Market Value requirement. The Company aims to maintain liquidity, attract talent, access capital, and enhance merger opportunities.

Insights

Financial Analyst

The decision by the Nasdaq Hearings Panel to allow T2 Biosystems continued listing, contingent on meeting the Market Value requirement, is a pivotal moment for the company. The stipulation to maintain a closing Market Value of at least $35.0 million for ten consecutive business days is a significant benchmark for T2 Biosystems. This threshold is reflective of the Nasdaq's standards to ensure that companies listed maintain a certain level of financial stability and investor interest.

From a financial perspective, the ability to remain listed on a major exchange like the Nasdaq is crucial for T2 Biosystems. It directly impacts the company's access to capital, investor perception and overall market credibility. The potential conversion of $15.0 million in debt to equity is a strategic move that could help bolster the company's Market Value. However, it's important to note that such conversions can dilute current shareholder value, potentially leading to short-term negative impacts on the stock price.

In the long-term, if T2 Biosystems successfully maintains its listing, it could benefit from increased investor confidence and improved capital-raising capabilities. Failure to comply with the Nasdaq's conditions, however, could result in delisting, which would likely reduce liquidity and negatively affect the company's stock price and ability to raise funds.

Market Research Analyst

The biotechnology sector, where T2 Biosystems operates, is highly competitive and requires constant innovation and capital for research and development. The company's focus on the rapid detection of sepsis-causing pathogens places it in a critical segment of the healthcare industry, given the high mortality rates associated with sepsis and the urgency of timely and accurate diagnosis.

Remaining listed on Nasdaq could enhance T2 Biosystems' visibility among institutional investors and analysts, which is often key to securing favorable coverage and investment. Moreover, the company's ability to maintain liquidity and attract key employees through stock-based compensation could be compromised if it fails to meet the Nasdaq's Market Value requirement.

It is also worth noting that the company's positioning for potential mergers and acquisitions could be adversely affected by delisting. Being on a major exchange is often a prerequisite for attracting high-quality merger and acquisition opportunities, which can provide strategic growth avenues for companies in the biotech industry.

Legal Expert

The Nasdaq Listing Rule 5550(b)(2) serves as a regulatory framework to ensure that companies listed on the exchange maintain a certain level of market capitalization, which is indicative of a healthy trading environment and investor interest. T2 Biosystems' ability to demonstrate compliance with this rule is not only a matter of regulatory adherence but also a reflection of the company's governance and strategic financial management.

Should T2 Biosystems fail to meet the Nasdaq's requirement within the given timeframe, it could face delisting procedures, which typically involve a complex legal process and can have far-reaching implications for the company's operational and strategic plans. The mention of potential actions advised by the company's Board of Directors, including the conversion of debt to equity, indicates that T2 Biosystems is proactively seeking solutions to comply with the Nasdaq's conditions, which is a positive sign of responsive corporate governance.

LEXINGTON, Mass., March 12, 2024 (GLOBE NEWSWIRE) -- T2 Biosystems, Inc. (NASDAQ:TTOO), a leader in the rapid detection of sepsis-causing pathogens and antibiotic resistance genes, today announced that the Nasdaq Hearings Panel has granted the Company's request for continued listing on the Nasdaq Stock Market, subject to the Company demonstrating compliance with Nasdaq's market value of listed securities (“Market Value”) requirement, as set forth in Nasdaq Listing Rule 5550(b)(2) (the “Rule”) on or before May 20, 2024.

The Company continues to prioritize maintaining its Nasdaq listing and considers it to be in the best interest of both the Company and its stockholders. Listing on the Nasdaq Stock Market maintains liquidity for stockholders, helps attract and retain key employees, broadens its access to capital, and better positions the Company for potential mergers and acquisitions.

The Rule requires that the Company maintain a closing Market Value of at least $35.0 million for a minimum of ten consecutive business days. During the extension period, the Company will continue to actively monitor its Market Value and take appropriate action, if necessary and as advised by the Company’s Board of Directors, to remedy the deficiency. These actions may include the potential conversion of $15.0 million dollars of outstanding indebtedness held by the Company’s lender, CRG, to equity in the Company. There can be no assurance, however, that the Company will be able to timely comply with the terms of the Nasdaq Hearings Panel’s decision.

About T2 Biosystems
T2 Biosystems, a leader in the rapid detection of sepsis-causing pathogens and antibiotic resistance genes, is dedicated to improving patient care and reducing the cost of care by helping clinicians effectively treat patients faster than ever before. T2 Biosystems’ products include the T2Dx^® Instrument, the T2Bacteria^® Panel, the T2Candida^® Panel, the T2Resistance^® Panel, and the T2Biothreat™ Panel, and are powered by the proprietary T2 Magnetic Resonance (T2MR^®) technology. T2 Biosystems has an active pipeline of future products, including the Candida auris test, and the T2Lyme™ Panel. For more information, please visit www.t2biosystems.com.

Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this press release that do not relate to matters of historical fact should be considered forward-looking statements, including, without limitation, statements about the Company’s ability to regain compliance with the listing requirements of the Nasdaq Capital Market, as well as statements that include the words “expect,” “may,” “should,” “anticipate,” and similar statements of a future or forward-looking nature. These forward-looking statements are based on management’s current expectations. These statements are neither promises nor guarantees, but involve known and unknown risks, uncertainties and other important factors that may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements, including, but not limited to, (i) any inability to (a) realize anticipated benefits from commitments, contracts or products; (b) successfully execute strategic priorities; (c) bring products to market; (d) expand product usage or adoption; (e) obtain customer testimonials; (f) accurately predict growth assumptions; (g) realize anticipated revenues; (h) incur expected levels of operating expenses; or (i) increase the number of high-risk patients at customer facilities; (ii) failure of early data to predict eventual outcomes; (iii) failure to make or obtain anticipated FDA filings or clearances within expected time frames or at all; or (iv) the factors discussed under Item 1A. “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022, filed with the U.S. Securities and Exchange Commission, or SEC, on March 31, 2023, and other filings the Company makes with the SEC from time to time, including our Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. These and other important factors could cause actual results to differ materially from those indicated by the forward-looking statements made in this press release. Any such forward-looking statements represent management’s estimates as of the date of this press release. While the Company may elect to update such forward-looking statements at some point in the future, unless required by law, it disclaims any obligation to do so, even if subsequent events cause its views to change. Thus, no one should assume that the Company’s silence over time means that actual events are bearing out as expressed or implied in such forward-looking statements. These forward-looking statements should not be relied upon as representing the Company’s views as of any date subsequent to the date of this press release.

Investor Contact:
Philip Trip Taylor, Gilmartin Group
ir@T2Biosystems.com
415-937-5406

FAQ

What did the Nasdaq Hearings Panel grant T2 Biosystems, Inc. (TTOO)?

The Nasdaq Hearings Panel granted T2 Biosystems, Inc. (TTOO) a request for continued listing on the Nasdaq Stock Market.

What is the Market Value requirement T2 Biosystems, Inc. (TTOO) needs to comply with?

T2 Biosystems, Inc. (TTOO) needs to maintain a closing Market Value of at least $35.0 million for a minimum of ten consecutive business days to comply with the Nasdaq Listing Rule 5550(b)(2).

What actions might T2 Biosystems, Inc. (TTOO) take to remedy the deficiency in Market Value?

T2 Biosystems, Inc. (TTOO) might potentially convert $15.0 million of outstanding indebtedness held by CRG, the Company's lender, to equity in the Company to remedy the deficiency.

What are the benefits of maintaining a listing on the Nasdaq Stock Market for T2 Biosystems, Inc. (TTOO)?

Maintaining a listing on the Nasdaq Stock Market helps T2 Biosystems, Inc. (TTOO) in maintaining liquidity for stockholders, attracting and retaining key employees, accessing capital, and positioning the Company for potential mergers and acquisitions.

What is the deadline for T2 Biosystems, Inc. (TTOO) to comply with the Market Value requirement?

T2 Biosystems, Inc. (TTOO) needs to demonstrate compliance with Nasdaq's Market Value requirement on or before May 20, 2024, as per the decision of the Nasdaq Hearings Panel.