Item 1A. Risk Factors
Item 1A. Risk Factors.
As of the date of this filing, except as discussed below, there have been no material changes to the risk factors included in our Annual Report on Form 10-K for the year ended December 31, 2022, as filed with the SEC on March 3, 2023. There have been no material changes in our risk factors from those disclosed in “Item 1A. Risk Factors” of the Form 10-K, Form 10-Q, and other reports that we have filed with the SEC. Any of the risks discussed in such reports, as well as additional risks and uncertainties not currently known to us or that we currently deem immaterial, could materially and adversely affect our results of operations, financial condition or prospects.
We have not been in compliance with the requirements of the Nasdaq Stock Market for continued listing and if Nasdaq does not concur that we have adequately remedied our non-compliance, our common stock may be delisted from trading on Nasdaq, which could have a material adverse effect on us and our shareholders.
On March 24, 2023, the Company received a written notice from The Nasdaq Stock Market (“Nasdaq”) that, because the closing bid price for the Company's common stock had fallen below $1.00 per share for 30 consecutive business days, the Company no longer complies with the minimum bid price requirement for continued listing on the Nasdaq Global Select Market (the “Minimum Bid Price Requirement”).
Pursuant to Nasdaq Marketplace Rule 5810(c)(3)(A), the Company was provided an initial compliance period of 180 calendar days, or until September 20, 2023, to regain compliance with the Minimum Bid Price Requirement. To regain compliance, the closing bid price of the Company's common stock must meet or exceed $1.00 per share for a minimum of 10 consecutive business days during the compliance period.
On September 21, 2023, the Company received a letter from Nasdaq stating that the Company had not regained compliance with the Minimum Bid Price Requirement by the required compliance date and, as a result, the Company’s Common Stock was subject to delisting. The Company submitted a hearing request to Nasdaq to appeal the delisting determination on September 22, 2023, which automatically stayed the delisting of the Company’s Common Stock from Nasdaq pending a decision from a Nasdaq listing qualifications hearings panel (the “Panel”) decision.
In response, Nasdaq offered the Company an expedited review process, which required the Company to complete a questionnaire regarding the Company’s plan to regain compliance with the Minimum Bid Requirement. The Company submitted the questionnaire on September 26, 2023, which included a statement that, if necessary, the Company will effect a reverse stock split on or before March 1, 2024, to regain compliance with the Minimum Bid Price Requirement.
On October 9, 2023, the Company received a letter from the Panel informing the Company that Nasdaq granted the Company a temporary exception to regain compliance with the Minimum Bid Price Requirement. As a result, the Company now has until March 15, 2024, to regain compliance with the Minimum Bid Price Requirement.
The Company has already received approval from the Company’s stockholders to effect a reverse stock split in the range of 1-for-5 to 1-for-10, which was approved at the Company’s annual meeting of stockholders on September 5, 2023. There can be no assurance that we will regain compliance with, or that our stock price will continue to meet, the Minimum Bid Price Requirement, or that we will meet other requirements, for continued listing on Nasdaq. If our common stock is delisted from Nasdaq and we are unable to list our common stock on another national securities exchange, we expect our common stock would be quoted on an over-the-counter market. If this were to occur, we and our stockholders could face significant material adverse consequences, including the limited availability of market quotations for our common stock; substantially decreased trading in our common stock; decreased market liquidity of our common stock as a result of the loss of market efficiencies associated with Nasdaq and the loss of federal preemption of state securities laws; an adverse effect on our ability to issue additional securities or obtain additional financing in the future on acceptable terms, if at all; potential loss of confidence by investors, suppliers, partners, and employees and fewer business development opportunities; and limited news and analyst coverage. Additionally, the market price of our common stock may decline further, and stockholders may lose some or all of their investment.
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Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
None.
Item 3. Defaults Upon Senior Securities.
None.
Item 4. Mine Safety Disclosures.
Not applicable.
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