WiSA Technologies Announces Nasdaq Acceptance of Compliance Plan
- None.
- None.
Insights
The decision by WiSA Technologies, Inc. to enact a 1-for-150 reverse stock split is a strategic move aimed at addressing compliance issues with Nasdaq's minimum bid price rule. This maneuver is typically employed by companies facing delisting due to their stock trading below the exchange's required threshold. By consolidating shares, the per-share price is artificially increased, potentially satisfying the Nasdaq Rule 5550(a)(2) without altering the company's market capitalization.
For investors, the immediate effect is a reduction in the number of shares held, but with a proportionate increase in the value of each share. The long-term implications, however, are more nuanced. While this action may stave off delisting, it is often viewed as a sign of underlying financial distress. Investors should closely monitor subsequent financial performance and management's execution of turnaround strategies. Additionally, it's important to consider the historical performance of stocks post-reverse split, as they can sometimes continue to underperform.
WiSA Technologies' sector positioning and market dynamics are essential factors to consider when evaluating the impact of the reverse stock split. In the tech industry, where innovation and growth prospects are key drivers of investment, a reverse split may signal to the market a company's struggle to maintain its competitive edge. The wireless audio technology market is characterized by rapid innovation and intense competition and investors often seek companies with clear growth trajectories.
It is important to assess how the market perceives such financial engineering moves. If the reverse split is part of a broader strategic plan that includes new product launches or entry into new markets, the market reaction could be positive. Conversely, if the split is perceived as a mere short-term fix, the market may respond unfavorably. Stakeholders should look for additional signals from the company, such as advancements in technology, partnerships, or expansion plans that could bolster investor confidence post-split.
From a regulatory standpoint, the reverse stock split by WiSA Technologies must adhere to both Nasdaq listing requirements and securities law. The company's adherence to Nasdaq Rule 5550(b)(1), which concerns stockholders' equity, is also a critical factor for continued listing. The legal framework ensures that the company maintains certain standards of financial health, which, in theory, protects investors and maintains market integrity.
Investors should be aware of the legal implications of a reverse stock split, including changes in shareholder voting rights and potential adjustments to equity-based compensation for employees. It is also advisable for shareholders to review the terms of the reverse split in the context of the company's charter and bylaws, as these corporate governance documents will outline the specific rights and procedures associated with such an action.
Plans 1-for-150 Reverse Stock Split
Specifically, the Panel granted the Company’s request for continued listing, subject to the following:
-
On or before April 28, 2024, the Company must demonstrate compliance with Nasdaq Rule 5550(a)(2), to meet a minimum bid price of at least
$1 -
On or before June 28, 2024, the Company shall demonstrate compliance with Nasdaq Rule 5550(b)(1), attaining stockholders' equity of at least
$2.5 million
The Company plans to implement a one-for-one hundred and fifty reverse stock split on Friday, April 12, 2024, with a Nasdaq market effective date of Monday, April 15, 2024. The reverse stock split is intended to increase the per-share trading price of the Company's common stock to enable the Company to regain compliance with the minimum bid price requirement for continued listing on the Nasdaq Capital Market. The Company intends to issue an additional press release later this week for additional information with respect to the reverse stock split.
About WiSA Technologies, Inc.
WiSA Technologies, Inc. (Nasdaq: WISA) is a leading provider of immersive, wireless sound technology for intelligent devices and next-generation home entertainment systems. Working with leading CE brands and manufacturers such as Harman International, a division of Samsung; LG; Hisense; TCL; Bang & Olufsen; Platin Audio; and others, the company delivers immersive wireless sound experiences for high-definition content, including movies and video, music, sports, gaming/esports, and more. WiSA Technologies, Inc. is a founding member of WiSA™ (the Wireless Speaker and Audio Association) whose mission is to define wireless audio interoperability standards as well as work with leading consumer electronics companies, technology providers, retailers, and ecosystem partners to evangelize and market spatial audio technologies driven by WiSA Technologies, Inc. The company is headquartered in
© 2024 WiSA Technologies, Inc. All rights reserved. WiSA Technologies, Inc. and the WiSA Technologies, Inc. logo are trademarks of WiSA Technologies, Inc. The WiSA logo, WiSA®, WiSA Ready™, and WiSA Certified™ are trademarks and certification marks of WiSA, LLC. Third-party trade names, trademarks and product names are the intellectual property of their respective owners.
Safe Harbor Statement
This press release contains forward-looking statements, which are not historical facts, within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. In some cases, you can identify these forward-looking statements by the use of words such as “may,” “could,” “expect,” “intend,” “plan,” “seek,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” “continue,” “likely,” “will,” “would” and variations of these terms and similar expressions, or the negative of these terms or similar expressions. Such forward-looking statements, including statements herein regarding our business opportunities and prospects, our ability to satisfy Nasdaq listing requirements and the steps we plan to take with respect thereto, are necessarily based upon estimates and assumptions that, while considered reasonable by us and our management, are inherently uncertain. Readers are cautioned not to place undue reliance on these forward-looking statements. Actual results may differ materially from those indicated by these forward-looking statements as a result of risks and uncertainties regarding, among other items: our ability to complete the reverse stock split, our current liquidity position and the need to obtain additional financing to support ongoing operations; general market, economic and other conditions; our ability to continue as a going concern; our ability to maintain the listing of our common stock on Nasdaq; our ability to manage costs and execute on our operational and budget plans; our ability to achieve our financial goals; and other risks as more fully described in our filings with the
View source version on businesswire.com: https://www.businesswire.com/news/home/20240409709221/en/
David Barnard, LHA Investor Relations, 415-433-3777, wisa@lhai.com
Source: WiSA Technologies, Inc.
FAQ
What did WiSA Technologies, Inc. (WISA) announce regarding its stock?
What are the compliance requirements set by the Nasdaq Hearings Panel for WiSA Technologies, Inc. (WISA)?
When will WiSA Technologies, Inc. (WISA) implement the reverse stock split?
Why is WiSA Technologies, Inc. (WISA) conducting the reverse stock split?
