Item 3.01 Notice of Delisting or Failure to Satisfy Continued Listing Rule or
Standard; Transfer of Listing
On January 27, 2023, Ensysce Biosciences Inc. (the "Company") received a notice
in the form of a letter (the "Deficiency Letter") from the listing
qualifications department staff of The Nasdaq Stock Market ("Nasdaq") stating
that the Company was not in compliance with Nasdaq Listing Rule 5550(a)(2)
because the bid price for the Company's common stock had closed below $1.00 per
share for the previous 30 consecutive business days.
In accordance with Nasdaq listing rule 5810(c)(3)(A), the Company has 180
calendar days, or until July 26, 2023, to regain compliance. The Deficiency
Letter states that to regain compliance, the bid price for the Company's common
stock must close at $1.00 per share or more (the "Minimum Bid Price") for a
minimum of 10 consecutive business days during the compliance period ending July
26, 2023. The Deficiency Letter does not explicitly address that the Nasdaq
staff may require a longer period of time for compliance with the Minimum Bid
Price in some circumstances, but generally not more than 20 consecutive business
days.
The Deficiency Letter has no immediate effect on the listing of the Company's
common stock, and the Company's common stock continues to trade on the Nasdaq
Capital Market under the symbol "ENSC."
If the Company does not regain compliance by July 26, 2023, Nasdaq staff will
provide written notice to the Company that its securities are subject to
delisting. At that time, the Company may appeal any such delisting determination
to a Nasdaq hearings panel.
The Company intends to actively monitor the closing bid price for the Company's
common stock between now and July 26, 2023 and may, if appropriate, evaluate
available options to resolve the deficiency and regain compliance with the
Minimum Bid Price requirement. While the Company is exercising diligent efforts
to maintain the listing of its common stock on Nasdaq, there can be no assurance
that the Company will be able to regain or maintain compliance with Nasdaq
listing standards.
On June 17, 2022, we received a similar written notice from the Nasdaq Staff. We
had until December 14, 2022 to regain compliance with the Minimum Bid Price
requirement. In October 2022, we implemented a 1-20 reverse stock split. On
November 11, 2022, we received written notice from Nasdaq that we had regained
compliance with the Minimum Bid Price requirement.
However, on December 14, 2022, we received a notice of a determination (the
"Notice") from Nasdaq, which referenced the Nasdaq letter sent to the Company,
dated June 16, 2022 (the "June 16th Notice"), that the Company's Minimum Value
of Listed Securities ("MVLS") was below the minimum of $35 million required for
continued listing. Because we did not regain compliance by the deadline set
forth in the June 16th Notice we requested a hearing before a Nasdaq Hearings
Panel (the "Panel"). That hearing was held on January 26, 2023 and we await the
decision of the Panel. In connection with the hearing, any suspension or
delisting action has been stayed pending the determination of the Panel
following the hearing. In that regard, the Panel has the authority to grant an
additional extension period not to exceed past June 12, 2023. There can be no
assurance that the Company will be granted more time to attempt to comply with
the MVLS requirement or be able to regain or maintain compliance with Nasdaq
listing standards, including the Minimum Bid Price requirement.
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