Item 3.01 Notice of Delisting or Failure to Satisfy a Continued
Listing Rule or Standard; Transfer of Listing
As
previously reported by Dynatronics Corporation (the
“Company”), on
May 18, 2020 the Company received a
letter from the Listing Qualifications Department (the
“Staff”) of the Nasdaq Stock Market
(“Nasdaq”) notifying the Company that it was not in
compliance with the Nasdaq Listing Rule 5550(a)(2) (the
“Minimum Bid Price
Requirement”) because the
closing bid price for the Company’s common stock had closed
below $1.00 per share for the previous 30 consecutive business
days. The Company was provided an initial grace period to regain
compliance, which ended on December 28, 2020.
On
December 30, 2020, the Company received notice from Nasdaq
indicating that, while the Company has not regained compliance with
the Minimum Bid Price Requirement, the Staff has determined that
the Company is eligible for an additional 180 calendar day period,
or until June 28, 2021, to regain compliance (the
“Second 180 Day Compliance
Period”). The Staff indicated that its determination
is based on the Company meeting the continued listing requirement
for market value of publicly held shares, and all other applicable
requirements for initial listing on the Nasdaq Capital Market with
the exception of the bid price requirement, and the Company’s
written notice of its intention to cure the deficiency during the
Second 180 Day Compliance Period by effecting a reverse stock
split, if necessary.
The
Company notes that at its Annual Meeting of the Shareholders held
on December 10, 2020, the shareholders approved the adoption of an
amendment to the Company’s Articles of Incorporation to
effect, in the discretion of the Board of Directors, a reverse
split of the outstanding Common Stock of the Company, at any time
within one year from the date of shareholder approval. The Board
has not yet determined to effect a reverse stock
split.
If at any time during the Second 180 Day Compliance Period the
closing bid price of the Company’s common stock is at least
$1.00 per share for a minimum of 10 consecutive business days, the
Staff will provide written confirmation of compliance.
If compliance cannot be demonstrated by June 28, 2021, the Staff
will provide written notification that the Company’s
securities will be delisted from Nasdaq. At that time, the Company
may appeal the Staff’s determination to a Nasdaq hearings
panel.
While there can be no assurance that the Company will regain or
demonstrate compliance by June 28, 2021, the Company intends to
consider available options to regain compliance by that
date.