Nasdaq Extends Cogentix’s Timeline To Retain Stock Listing
Nasdaq has granted Cogentix Medical Inc. an extension to regain compliance with the stock exchange after it threatened to pull the medtech company’s stock listing in July.
According to a regulatory filing from Monday, the Minnetonka-based manufacturer of urology products now has until January 17, 2017 to comply with a specific Nasdaq Listing Rule that calls for a majority of the company’s board to be “independent directors.”
Cogentix submitted a plan to Nasdaq on September 2 that described how it would instead become a “controlled company” rather than one operated by independent directors. (By doing so, Cogentix would then be exempt from Listing Rule 5605 as it would meet the requirements of the comparable Nasdaq Listing Rule 5615.)
The company claimed it is able to accomplish a “controlled company” rule switch after a $25 million stock buy-back it performed last week.
After Accelmed Growth Partners, a medical industry investor based in New York and Israel, agreed to buy a 27 percent stake in Cogentix for $25 million, the company used the new capital to pay off a debt owed to board member Lewis Pell. Upon completion of the deal, Pell would ultimately receive a 33 percent stock ownership of the company. Between Pell and Accelmed’s 60 percent stake, Cogentix said it could then be classified as a “controlled company.”
The company said its deal with Accelmed (along with the payment of stock to Pell) is expected to close by mid-November.