Flux Power Receives Non-Compliance Letter from Nasdaq

Rhea-AI Summary

Flux Power Holdings (NASDAQ: FLUX) received a non-compliance notice from Nasdaq on November 20, 2024, for failing to file its Form 10-Q for the period ended September 30, 2024, and Form 10-K for fiscal year ended June 30, 2024. While this notification doesn't immediately affect the company's Nasdaq listing, Flux Power must submit a compliance plan by December 16, 2024. If Nasdaq accepts the plan, the company may receive up to 180 days (until April 14, 2025) to regain compliance. The company states it's working to complete and file both forms promptly.

Positive

• No immediate delisting from Nasdaq despite non-compliance
• Company has opportunity to submit compliance plan and potential 180-day extension

Negative

• Failure to file required Form 10-Q and Form 10-K financial reports
• Risk of potential Nasdaq delisting if compliance plan is not accepted
• Delayed financial reporting indicates potential internal control or accounting issues

Insights

Legal & Compliance Expert

This Nasdaq non-compliance notice represents a significant regulatory challenge for Flux Power. The failure to file both Form 10-K and 10-Q raises serious concerns about the company's financial reporting capabilities and internal controls. The December 16 deadline for submitting a compliance plan is particularly tight, giving the company less than a month to address these issues.

The potential 180-day extension to April 2025 provides some breathing room, but the risk of delisting remains if the company fails to meet these deadlines or if Nasdaq rejects their compliance plan. Historical precedent shows that companies in similar situations often face increased scrutiny from investors and potential difficulties in maintaining institutional investment relationships. The lack of current financial statements also limits investors' ability to make informed decisions about the company's performance and financial health.

Financial Analyst

The delayed financial filings are particularly concerning for a small-cap company with a market cap of just $39.5 million. Missing both annual and quarterly filings suggests potential underlying issues that could range from accounting complexities to resource constraints. For investors, this creates a significant information vacuum about the company's operational and financial performance during a critical period in the energy storage sector.

The timing of these delays coincides with broader market interest in lithium-ion storage solutions, making the lack of current financial data particularly problematic for valuation purposes. While the company maintains its listing for now, this situation typically leads to increased stock volatility and reduced institutional interest until resolution.

VISTA, Calif.--(BUSINESS WIRE)-- Flux Power Holdings, Inc. (NASDAQ: FLUX), a developer of advanced lithium-ion energy storage solutions for electrification of commercial and industrial equipment, today announced that on November 20, 2024, it received a letter from the Listing Qualifications Department of the Nasdaq Stock Market LLC (“Nasdaq”) notifying the Company that it was not in compliance with requirements of Nasdaq Listing Rule 5250(c)(1) as a result of not having filed its Quarterly Report on Form 10-Q for the period ended September 30, 2024 (“Form 10-Q”) and its Annual Report on Form 10-K for fiscal year ended June 30, 2024 (“Form 10-K”), with the Securities and Exchange Commission (“SEC”).

This notification has no immediate effect on the listing of the Company’s common stock on the Nasdaq. Under the Nasdaq rules, the Company has until December 16, 2024, to submit to Nasdaq a plan to regain compliance with the Nasdaq Listing Rule. If Nasdaq accepts the Company’s plan, then Nasdaq may grant the Company up to 180 days from the prescribed due date for the Form 10-K to regain compliance, or April 14, 2025. If Nasdaq does not accept the Company’s plan, then the Company will have the opportunity to appeal that decision to a Nasdaq Hearings Panel.

The Company is working diligently to complete its Form 10-K and Form 10-Q and plans to file its Form 10-K and Form 10-Q as promptly as practicable to regain compliance with the Listing Rule.

About Flux Power Holdings, Inc.

Flux Power (NASDAQ: FLUX) designs, manufactures, and sells advanced lithium-ion energy storage solutions for electrification of a range of industrial and commercial sectors including material handling, airport ground support equipment (GSE), and stationary energy storage. Flux Power’s lithium-ion battery packs, including the proprietary battery management system (BMS) and telemetry, provide customers with a better performing, lower cost of ownership, and more environmentally friendly alternative, in many instances, to traditional lead acid and propane-based solutions. Lithium-ion battery packs reduce CO2 emissions and help improve sustainability and ESG metrics for fleets. For more information, please visit www.fluxpower.com.

Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, as amended, and other securities law. Forward-looking statements are statements that are not historical facts. Words and phrases such as “anticipated,” “forward,” “will,” “would,” “could,” “may,” “intend,” “remain,” “potential,” “prepare,” “expected,” “believe,” “plan,” “seek,” “continue,” “estimate,” and similar expressions are intended to identify forward-looking statements. These statements include, but are not limited to, the expected filing date of its Form 10-K and Form 10-Q and ability to regain compliance under the Nasdaq listing rule. All of such statements are subject to certain risks and uncertainties, many of which are difficult to predict and generally beyond the Company’s control, that could cause actual results to differ materially from those expressed in, or implied or projected by, the forward-looking information and statements. Such risks and uncertainties include, but are not limited to, the completion of the review and preparation of the Company’s financial statements and internal control over financial reporting and disclosure controls and procedures and the timing thereof; the discovery of additional information; delays in the Company’s financial reporting, including as a result of unanticipated factors; the Company’s ability to obtain necessary waivers or amendments to the Loan Agreement in the future; the risk that the Company may become subject to future litigation; the Company’s ability to remediate material weaknesses in its internal control over financial reporting; risks inherent in estimates or judgments relating to the Company’s critical accounting policies, or any of the Company’s estimates or projections, which may prove to be inaccurate; unanticipated factors in addition to the foregoing that may impact the Company’s financial and business projections and guidance and may cause the Company’s actual results and outcomes to materially differ from its estimates, projections and guidance; and those risks and uncertainties identified in the “Risk Factors” sections of the Company’s Annual Report on Form 10-K for the year ended June 30, 2023, and its other subsequent filings with the SEC. Readers are cautioned not to place undue reliance on these forward-looking statements. All forward-looking statements contained in this press release speak only as of the date on which they were made. Except to the extent required by law, the Company undertakes no obligation to update such statements to reflect events that occur or circumstances that exist after the date on which they were made.

Flux, Flux Power, and associated logos are trademarks of Flux Power Holdings, Inc. All other third-party brands, products, trademarks, or registered marks are the property of and used to identify the products or services of their respective owners.

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View source version on businesswire.com: https://www.businesswire.com/news/home/20241125289701/en/

Media & Investor Relations:

media@fluxpower.com

info@fluxpower.com

External Investor Relations:

Chris Tyson, Executive Vice President

MZ Group - MZ North America

949-491-8235

FLUX@mzgroup.us

www.mzgroup.us

Source: Flux Power Holdings, Inc.

FAQ

Why did Flux Power (FLUX) receive a Nasdaq non-compliance notice?

Flux Power received a Nasdaq non-compliance notice on November 20, 2024, for failing to file its Form 10-Q for Q3 2024 and Form 10-K for fiscal year 2024 with the SEC.

What is the deadline for Flux Power (FLUX) to submit its compliance plan to Nasdaq?

Flux Power must submit its compliance plan to Nasdaq by December 16, 2024.

How long does Flux Power (FLUX) have to regain Nasdaq compliance?

If Nasdaq accepts the compliance plan, Flux Power may receive up to 180 days, until April 14, 2025, to regain compliance.

Will Flux Power (FLUX) be immediately delisted from Nasdaq?

No, the non-compliance notification has no immediate effect on Flux Power's Nasdaq listing while the company works to resolve the filing issues.