In a recent development, Talis Biomedical Corp (NASDAQ:TLIS) has entered into a settlement agreement to conclude a securities class action litigation. The settlement, dated August 29, 2024, stipulates that the company will contribute $32.5 million to a fund intended to resolve claims related to its February 2021 initial public offering (IPO).
The lawsuit alleged that Talis Biomedical's registration statement and prospectus were misleading, failing to disclose material adverse facts concerning its product manufacturing and the reliability of its COVID-19 test. The settlement will cover all claims against the company and its co-defendants, which include certain current and former officers and directors, as well as the IPO underwriters.
According to the terms outlined, Talis Biomedical's insurance carriers are expected to fund approximately $5 million of the settlement, with the remaining $27.5 million to be paid from the company's cash reserves. A third-party administrator will manage the settlement fund, ensuring that class members are notified and compensated.
The agreement also mentions that within 14 days of the Settlement Term Sheet's execution, Talis Biomedical will file for Chapter 11 bankruptcy or, if not filed within that period, the plaintiff will move for preliminary approval of the settlement in the U.S. District Court for the Northern District of California.
The settlement does not imply any admission of fault or liability by Talis Biomedical, and the company maintains that it has substantial defenses to the claims. However, if the settlement is not approved or finalized, the company acknowledges that an adverse outcome could materially affect its financial condition, as previously disclosed in its SEC filings.
The settlement is still subject to approval by the Bankruptcy Court and the U.S. District Court, and there is no certainty regarding the final outcome of the litigation or the approval of the settlement terms.
In other recent news, Talis Biomedical Corp, previously known as SlipChip Corp, is slated to be delisted from the Nasdaq Stock Market. This development follows the Nasdaq Listing Qualifications Department's determination that the company now functions as a "public shell" due to the suspension of its research and development activities.
This status makes it ineligible for continued listing, as per Nasdaq Listing Rule 5101. Despite the company's disagreement with the shell company label, Talis Biomedical has decided not to contest the Nasdaq's decision.
Consequently, the trading of the company's common stock is anticipated to be halted. Following this, a Form 25-NSE will be filed with the Securities and Exchange Commission (SEC), officially removing the company's common stock from Nasdaq's listings.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.