8-K: Pasithea Therapeutics Receives Nasdaq Delisting Warning for Sub-$1.00 Share Price

Pasithea Therapeutics Corp. has received a notice from Nasdaq indicating non-compliance with the minimum $1.00 bid price requirement, initiating a 180-day period to regain compliance.

Summary

• On June 23, 2025, Pasithea Therapeutics Corp. (the "Company") received a written notice from The Nasdaq Stock Market (Nasdaq) indicating non-compliance with the $1.00 minimum bid price requirement (Nasdaq Listing Rule 5550(a)(2)).
• The non-compliance is due to the Company's common stock closing bid price being below $1.00 per share for 30 consecutive business days.
• The notice does not result in immediate delisting of the Company's common stock.
• The Company has been granted 180 calendar days, until December 22, 2025, to regain compliance.
• Compliance can be regained if the common stock's bid price closes at or above $1.00 per share for a minimum of ten consecutive business days during this period.
• If compliance is not regained within the initial 180-day period, the Company may be eligible for an additional 180-calendar day compliance period, provided it meets other listing requirements (except the bid price) and notifies Nasdaq of its intent to cure the deficiency, potentially through a reverse stock split.
• Failure to regain compliance could lead to delisting from The Nasdaq Capital Market, though the Company would have the right to appeal to a hearings panel.
• The Company stated that the receipt of the notice does not affect its business, operations, or reporting requirements with the Securities and Exchange Commission.

Sentiment

Score: 3

Explanation: The document reports a significant negative event (Nasdaq non-compliance notice) which indicates underlying issues with the company's stock performance and carries the risk of delisting, despite the grace period and stated intent to resolve.

Positives

• The notice from Nasdaq does not result in the immediate delisting of the Company's common stock.
• Pasithea Therapeutics Corp. has been provided a 180-calendar day period, until December 22, 2025, to regain compliance with the minimum bid price requirement.
• The Company may be eligible for an additional 180-day compliance period if certain conditions are met, including meeting other listing requirements and providing notice of intent to cure.
• The notice does not affect the Company's business, operations, or reporting requirements with the SEC.

Negatives

• Pasithea Therapeutics Corp. is not in compliance with Nasdaq's $1.00 minimum bid price requirement.
• The Company's common stock has traded below $1.00 per share for 30 consecutive business days.
• Failure to regain compliance within the specified periods could lead to the delisting of the Company's common stock from The Nasdaq Capital Market.

Risks

• Risk of delisting from The Nasdaq Capital Market if the Company fails to regain compliance with the $1.00 minimum bid price requirement within the initial or extended compliance periods.
• Potential necessity of a reverse stock split to increase the share price, which can sometimes be viewed negatively by investors or lead to reduced liquidity.
• Risk of not meeting other Nasdaq continued listing requirements, which could prevent eligibility for an additional compliance period.

Future Outlook

The Company intends to monitor the closing bid price of its common stock and is actively considering its options to regain compliance with the Nasdaq Bid Price Requirement. This includes the potential for a reverse stock split if necessary to cure the deficiency during a possible second compliance period.

Management Comments

• "The Company intends to monitor the closing bid price of its common stock and is considering its options to regain compliance with the Bid Price Requirement."

Industry Context

Receiving a Nasdaq delisting notice for failing to meet the minimum bid price requirement is a common occurrence for smaller or micro-cap companies, particularly in sectors facing headwinds or those with limited institutional investor interest. Such notices often signal underlying challenges in market valuation or investor confidence. While not an immediate delisting, it places significant pressure on management to implement strategies, such as reverse stock splits or operational improvements, to boost the share price and maintain listing status, which is crucial for liquidity and access to capital markets.

Stakeholder Impact

• Shareholders: Face potential risks of further share price decline, reduced liquidity, and the ultimate risk of delisting, which could make shares harder to trade. A reverse stock split, if implemented, would reduce the number of outstanding shares and could impact investor perception.
• Employees: No direct immediate impact mentioned, but long-term stability could be affected if the Company's financial health or market access deteriorates due to delisting.
• Customers/Suppliers/Creditors: No direct immediate impact mentioned, as the notice explicitly states it does not affect the Company's business operations or reporting requirements.

Next Steps

• Monitor the closing bid price of its common stock.
• Consider various options to regain compliance with the Nasdaq Bid Price Requirement.
• Potentially effect a reverse stock split if required to cure the deficiency during a second compliance period.
• Appeal any delisting determination to a Nasdaq hearings panel if compliance is not regained.

Key Dates

Recommendation

Keywords

Pasithea Therapeutics, KTTA, Nasdaq, delisting notice, minimum bid price, stock compliance, reverse stock split, Nasdaq Capital Market, SEC filing, 8-K