NASDAQ issues Staff Determination letter to Hythiam

Hythiam, Inc. (NASDAQ:HYTM) today announced that on August 28, 2009 Hythiam, Inc. (the “Company”) received a letter (the “Staff Determination”) from the Nasdaq Stock Market (“NASDAQ”) notifying the Company that, based upon the Company’s non-compliance with the $10 million stockholders’ equity requirement set forth in NASDAQ Listing Rule 5450(b) as of August 27, 2009, the Company’s securities were subject to delisting from The NASDAQ Global Market unless the Company requests a hearing before the NASDAQ Listing Qualifications Panel (the “NASDAQ Panel”). For the period ended June 30, 2009 and as reported in the Company’s quarterly form 10Q filing, the Company’s stockholders’ equity was $2,026,000.

On or before 4 P.M. Eastern Time on September 4, 2009, the Company plans to request a hearing before the NASDAQ Panel, which will stay any action with respect to the Staff Determination until the NASDAQ Panel renders a decision subsequent to the hearing. The Company is working towards completing contracts with third party payors in the near future. With this validation of our business model, we are hopeful that we can demonstrate an overall plan to regain compliance with NASDAQ requirements. There can be no assurance that the Company will be able to do so, or that the NASDAQ Panel will grant the Company’s request for continued listing.

As previously announced, on May 14, 2009, the Company received notice from NASDAQ that its stockholders’ equity was below the minimum requirement for continued listing on The NASDAQ Global Market. Pursuant to the Listing Rules, the Company requested and was granted an extension of 105 days, through August 27, 2009, to regain compliance with that requirement. The Company did not regain compliance by August 27, 2009, which resulted in the subsequent issuance of the Staff Determination.