On October 4, 2022 Sonnet BioTherapeutics Holdings, Inc. (NASDAQ:SONN) (the "Company" or "Sonnet BioTherapeutics"), a clinical-stage company developing targeted immunotherapeutic drugs, reported that it received notice from The Nasdaq Stock Market LLC (Nasdaq) on October 3, 2022 informing Sonnet that it has regained compliance with the minimum bid price requirement under Nasdaq Listing Rule 5550(a)(2) (the "Rule") for continued listing on The Nasdaq Capital Market (Press release, Sonnet BioTherapeutics, OCT 4, 2022, View Source [SID1234621682]). In order to regain compliance with the Rule, the Company’s common stock was required to maintain a minimum closing bid price of $1.00 or more for at least 10 consecutive trading days. That requirement was met on September 30, 2022.

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Stockholders’ Equity Deficiency

As previously reported, on August 22, 2022, the Company received notice from Nasdaq advising the Company that it is not in compliance with the minimum stockholders’ equity requirement for continued listing on The Nasdaq Capital Market. Nasdaq Listing Rule 5550(b)(1) requires companies listed on The Nasdaq Capital Market to maintain stockholders’ equity of at least $2,500,000 (the "Stockholders’ Equity Requirement"). The notice had 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 "SONN," subject to the Company’s compliance with the other continued listing requirements. Pursuant to the notice, Nasdaq has given the Company 45 calendar days, or until October 6, 2022, to submit to Nasdaq a plan to regain compliance. If the Company’s plan is accepted, Nasdaq may grant an extension of up to 180 calendar days from the date of the Notice to evidence compliance. The Company is currently evaluating various courses of action to regain compliance and plans to timely submit its plan to Nasdaq to regain compliance with the Stockholders’ Equity Requirement.

There can be no assurance that the Company’s plan will be accepted or that if it is, the Company will be able to regain compliance. If the Company’s plan to regain compliance is not accepted, or if it is and the Company does not regain compliance within 180 days from the date of Nasdaq’s letter, or if the Company fails to satisfy another Nasdaq requirement for continued listing, Nasdaq could provide notice that the Company’s common stock will become subject to delisting. In such event, Nasdaq rules would permit the Company to appeal the decision to reject the Company’s proposed compliance plan or any delisting determination to a Nasdaq Hearings Panel. The hearing request would stay any suspension or delisting action pending the conclusion of the hearing process and the expiration of any additional extension period granted by the panel following the hearing.