CNS Pharmaceuticals, Inc. 10-Q

Item 1A. Risk Factors In addition to the other information set forth in this report, you should carefully consider the factors set forth below and discussed in the section entitled “Risk Factors” in our 2023 Annual Report on Form 10-K, filed with the SEC, which are incorporated herein by reference. The risks described in such reports are not the only risks facing our Company. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition and/or operating results. If we are unable to maintain compliance with the listing requirements of The Nasdaq Capital Market, our common stock may be delisted from The Nasdaq Capital Market which could have a material adverse effect on our financial condition and could make it more difficult for shareholders to sell their shares. Our common stock is listed on The Nasdaq Capital Market, and we are therefore subject to its continued listing requirements, including requirements with respect to the market value of publicly-held shares, market value of listed shares, minimum bid price per share, and minimum stockholder's equity, among others, and requirements relating to board and committee independence. If we fail to satisfy one or more of the requirements, we may be delisted from The Nasdaq Capital Market. On August 17, 2023, we were notified by the Listing Qualifications Department (the “Staff”) of the Nasdaq Stock Market (“Nasdaq”) that we were not in compliance with the minimum $2,500,000 stockholders’ equity requirement for continued listing set forth in Listing Rule 5550(b). On February 27, 2024, the Staff notified us that we did not comply with the $1.00 minimum bid price requirement set forth under Listing Rule 5550(a)(2). On February 14, 2024, we were notified that because we had not regained compliance with the Nasdaq equity requirement, our securities would be delisted unless it requested a hearing. On February 21, 2024, we requested a hearing, which was held on April 18, 2024. On May 6, 2024, we received notification from the Nasdaq Hearings Panel (“Panel”) that it has granted an extension until July 15, 2024, to demonstrate compliance with Listing Rules 5550(a)(2) and 5550(b). On July 12, 2024, we requested an extension of this time period until August 12, 2024. On July 19, 2024, the Panel granted the requested extension until August 12, 2024, which date represented the full extent of the Panel’s discretion to grant continued listing while we are non-compliant with Listing Rule 5550(b). On July 5, 2024, we received a letter from the Nasdaq Staff notifying we had regained compliance with Bid Price Rule as a result of the closing bid price of our common stock being at $1.00 per share or greater for the 20 consecutive business days from June 5, 2024, through July 3, 2024. 25 On August 7, 2024, we filed a Form 8-K with the SEC indicating that as of that date, our shareholders’ equity was above the $2.5 million continued listing equity requirement as set forth in Listing Rule 5550(b)(1). As of the date hereof, we have not received any notice from Nasdaq on our compliance status. Delisting from The Nasdaq Capital Market would adversely affect our ability to raise additional financing through the public or private sale of equity securities, may significantly affect the ability of investors to trade our securities and may negatively affect the value and liquidity of our common stock. Delisting also could have other negative results, including the potential loss of employee confidence, the loss of institutional investors or interest in business development opportunities. Item 2. Unregistered Sales of Equity Securities and Use of Proceeds Except as previously disclosed on Form 8-K, we have not issued any unregistered securities during the quarter ended June 30, 2024. Item 3. Defaults Upon Senior Securities None. Item 4. Mine Safety Disclosures Not applicable.