Phio Pharmaceuticals Corp. 10-Q

ITEM 1A. RISK FACTORS Our business, financial condition or results of operations could be materially adversely affected by the risks set forth in Part I, “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2021 filed with the SEC on March 22, 2022. There have been no material changes from those risk factors, except for the additional risk factors set forth below. This Quarterly Report on Form 10-Q also contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of certain factors, including these risks. Additional risks not currently known or currently material to us may also harm our business. We may not be able to regain compliance with the continued listing requirements of The Nasdaq Capital Market. On February 25, 2022, we received written notice (the “ Notification Letter ”) from the Nasdaq Stock Market (“ Nasdaq ”) notifying us that we were not in compliance with the minimum bid price requirements set forth in Nasdaq Listing Rule 5550(a)(2) for continued listing on The Nasdaq Capital Market. Nasdaq Listing Rule 5550(a)(2) requires listed securities to maintain a minimum bid price of $1.00 per share, and Listing Rule 5810(c)(3)(A) provides that a failure to meet the minimum bid price requirement exists if the deficiency continues for a period of 30 consecutive business days. Based on the closing bid price of our common stock for the 30 consecutive business days prior to the date of the Notification Letter, we no longer meet the minimum bid price requirement. The Notification Letter does not impact our listing on The Nasdaq Capital Market or trading of our common stock at this time. The Notification Letter states that we have 180 calendar days, or until August 24, 2022, to regain compliance with Nasdaq Listing Rule 5550(a)(2). To regain compliance, the bid price of our common stock must have a closing bid price of at least $1.00 per share for a minimum of 10 consecutive business days at any time prior to August 24, 2022. In the event that we do not regain compliance by August 24, 2022, we may be eligible for additional time to reach compliance with the minimum bid price requirement. There can be no assurance that we will be able to regain compliance with the minimum bid price requirement. However, if we fail to regain compliance with the minimum bid price listing requirement or fail to maintain compliance with all other applicable continued listing requirements and Nasdaq determines to delist our common stock, the delisting could adversely impact us by, among other things, reducing the liquidity and market price of our common stock; reducing the number of investors willing to hold or acquire our common stock; limiting our ability to issue additional securities in the future; and limiting our ability to fund our operations. The conflict between Russia and Ukraine may continue to cause or exacerbate global economic instability and potentially disrupt worldwide supply chains, which may adversely impact our business, financial condition and results of operations. In February 2022, a military invasion of Ukraine by Russian troops began, creating volatility and disruption in the U.S. and global markets. The ongoing invasion has caused or exacerbated significant impacts and disruptions to various aspects of the global economy, including exchange rates, financial markets, as well as worldwide supply chains. Additionally, Russia’s actions have led to sanctions levied by the U.S. and many other countries and additional sanctions may be imposed in the future. We cannot predict the broader and longer-term consequences of this conflict or the sanctions imposed in response, and such consequences could further adversely affect and disrupt the global economy and financial markets, leading to further instability and lack of liquidity in the capital markets, potentially making it more difficult for us to obtain additional funds. These factors could adversely impact our business, financial condition and results of operations. The potential effects of the conflict between Russia and Ukraine also could amplify many of the other risk factors described in Item 1A. Risk Factors in our Annual Report on Form 10-K for the year ended December 31, 2021. 23 ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS No sales or issuances of unregistered securities occurred that have not previously been disclosed in a Current Report on Form 8-K. ITEM 3. DEFAULTS UPON SENIOR SECURITIES None. ITEM 4. MINE SAFETY DISCLOSURES Not applicable.