eFFECTOR Therapeutics Announces it will Wind Down Operations as it Seeks Strategic Alternatives and Expects to be Delisted from Nasdaq

Rhea-AI Summary

eFFECTOR Therapeutics (NASDAQ: EFTR) announced it will wind down operations and explore strategic alternatives for its development programs. The decision, made during a special board meeting, involves terminating employees and preparing for delisting from Nasdaq. The company acknowledges non-compliance with Nasdaq's listing requirements and plans to request voluntary delisting soon. Craig R. Jalbert, an expert in distressed businesses, has been appointed as CEO, President, Treasurer, Secretary, and sole board member to oversee the wind-down process. Jalbert has extensive experience managing companies in their wind-down phases.

Positive

• None.

Negative

• The company is winding down operations.
• All employees have been terminated.
• The company does not meet Nasdaq's continued listing requirements.
• Securities are expected to be delisted from Nasdaq.
• The company is in a distressed financial state.

SOLANA BEACH, Calif. and REDWOOD CITY, Calif., June 24, 2024 (GLOBE NEWSWIRE) -- eFFECTOR Therapeutics, Inc. (NASDAQ: EFTR) today announced that the Company has terminated its employees and will wind down it operations, including seeking potential strategic alternatives for the Company’s development programs. This decision was made at a special meeting of the board of directors. Further, as previously disclosed, the Company’s securities do not presently meet the continued listing requirements of the Nasdaq Stock Market and its securities would be subject to delisting if the Company fails to regain compliance during the required compliance period. The Company plans to voluntarily request a delisting of its securities and expects its securities to be delisted in the near term.

The board of directors appointed Craig R. Jalbert, age 62, as the Company’s CEO, President, Treasurer and Secretary, and sole member of the board. Mr. Jalbert has served as a principal of the Foxborough, Massachusetts accounting firm of Verdolino & Lowey, P.C. since 1987. For over 30 years he has focused his practice in distressed businesses and has served, and continues to serve, in the capacities of officer and director for numerous firms in their wind-down phases.

Forward-Looking Statements
eFFECTOR cautions you that statements contained in this press release regarding matters that are not historical facts are forward-looking statements. The forward-looking statements are based on our current beliefs and expectations and include, but are not limited to, plans to wind down our operations, delist from Nasdaq and seek strategic alternatives. Actual results may differ from those set forth in this press release due to the risks and uncertainties inherent in our business, including, without limitation: our lender declaring a default under our loan and security agreement and accelerating all of our repayment obligations, which we expect will exceed our current available capital, and taking control of our pledged assets, which right to repayment would be senior to the rights of the holders of our common stock to receive any proceeds from any liquidation of the company; the timing, progress and results of our planned wind down and evaluation of strategic alternatives, including whether or not the evaluation of alternatives results in any transaction or additional value beyond our debt obligations; and other risks described in our prior filings with the Securities and Exchange Commission. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof, and we undertake no obligation to update such statements to reflect events that occur or circumstances that exist after the date hereof. All forward-looking statements are qualified in their entirety by this cautionary statement, which is made under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.

Contacts:

Verdolino & Lowey, P.C.
124 Washington Street, Suite 101
Foxboro, MA. 02035
Phone - 508-543-1720
Effector@vlpc.com

FAQ

What did eFFECTOR Therapeutics announce on June 24, 2024?

On June 24, 2024, eFFECTOR Therapeutics announced it will wind down operations, terminate employees, and seek strategic alternatives for its development programs. The company also plans to voluntarily request delisting from Nasdaq.

Why is eFFECTOR Therapeutics winding down operations?

eFFECTOR Therapeutics is winding down operations due to financial distress and an inability to meet Nasdaq's continued listing requirements.

What will happen to eFFECTOR Therapeutics' stock on Nasdaq?

eFFECTOR Therapeutics' stock is expected to be delisted from Nasdaq as the company plans to voluntarily request delisting.

Who is the new CEO of eFFECTOR Therapeutics?

Craig R. Jalbert has been appointed as the new CEO, President, Treasurer, Secretary, and sole board member of eFFECTOR Therapeutics.

What are eFFECTOR Therapeutics' strategic alternatives?

eFFECTOR Therapeutics is exploring potential strategic alternatives for its development programs, although specific alternatives have not been disclosed.