Tenon Stock Skyrockets 145% After Public Offering To Meet Nasdaq Rules: Retail Chatter Goes Through The Roof

Shares of surgical solutions firm Tenon Medical, Inc (TNON) shot up over 145% on Friday after the company announced the pricing of its public offering of shares and warrants in order to meet a Nasdaq minimum float requirement.

The firm had earlier received a letter from Nasdaq stating that it did not meet the “minimum 500,000 publicly held shares requirement.” 

The compliance issue followed Tenon Medical common stock’s 1-for-8 reverse split which reduced the firm’s outstanding common stock from a little over 4.08 million shares to 510,221 shares outstanding on a post-reverse split basis. Only 490,364 of such shares qualified as publicly held shares for purposes of the minimum float requirement, the firm said in an SEC filing.

Nasdaq had provided time till October 24, 2024 for the firm to come up with a plan to regain the compliance. Tenon, however, stated that it expects to regain compliance with the minimum float requirement in September itself.

On Friday, the company announced the pricing of its "reasonable best efforts" public offering with a single health-care focused institutional investor for the purchase and sale of up to 1,222,850 shares of common stock and warrants to purchase an equal number of shares at a combined offering price of $3.68 per share.

Tenon expects to receive aggregate gross proceeds of approximately $4.5 million, assuming no exercise of the warrants. The firm said that the warrants will have an exercise price of $3.55 per share and will be exercisable immediately. They will expire five years from the issuance date, Tenon said.

The offering is expected to close on Sept. 16, 2024, with Tenon intending to use the net proceeds for commercial activity, working capital and general corporate purposes.

In early September, the firm entered into a securities purchase agreement with certain investors to offer a total of 86,454 Series B preferred stock and warrants to purchase 16,214 shares of common stock at an exercise price equal to $4.2756 per share for an aggregate offering price of $550,000.

Tenon Medical’s shares have gained more than 87% over the last month, with the firm attracting investor eyeballs in the wake of the compliance developments. 

As a result, Stocktwits message volume shot up a whopping 64,900% during the same period as investors continued to discuss the fate of the stock.

Some investors, however, are advising to maintain caution.

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