Business Context and Reporting Period
This Form 8-K is filed by Know Labs, Inc. (not USBC, Inc.) on September 27, 2024, regarding a notification received from the NYSE American LLC. The Company is incorporated in Nevada and trades under the symbol KNW on the NYSE American.
Key Financial Metrics
- Stockholders' Equity: As of June 30, 2024, the Company reported a stockholders' deficit of $4.6 million.
- Profitability: The Company has reported losses from continuing operations and/or net losses in each of the five most recent fiscal years ended September 30, 2023.
- Compliance Thresholds: NYSE American requires $4.0 million in equity if losses occurred in three of the last four years, or $6.0 million if losses occurred in the last five years.
- Cash Flow, Revenue, Debt: The filing text does not provide specific values for revenue, cash flow, operating margins, or debt levels.
Material Changes and Listing Status
The Company is currently not in compliance with the minimum stockholders' equity requirements of Sections 1003(a)(ii) and 1003(a)(iii) of the NYSE American Company Guide due to its equity deficit and history of losses. Consequently, the Company is subject to Section 1009 procedures.
- Immediate Effect: The notification has no immediate effect on the listing or trading of the Company's common stock.
- Compliance Deadline: The Company must submit a plan to regain compliance by October 27, 2024.
- Target Compliance Date: The plan must demonstrate actions to regain compliance by March 27, 2026.
Outlook, Risks, and Management Commentary
Management intends to submit a plan to regain compliance with NYSE American listing standards. If the plan is accepted, the Company will continue listing subject to periodic reviews. If the plan is not accepted, delisting proceedings will commence. The Company retains the right to appeal a staff delisting determination.
Risks and Contingencies: The filing includes standard forward-looking statement disclaimers. Actual results may differ materially due to risks detailed in the latest Form 10-K. The primary contingency is the potential delisting if the compliance plan is rejected or if the Company fails to meet the March 2026 target.
Investor Verification Checklist
- Verify the specific details of the compliance plan to be submitted by October 27, 2024.
- Review the latest Form 10-K for detailed "Risk Factors" and historical financial performance.
- Monitor subsequent filings for the NYSE American's acceptance or rejection of the compliance plan.
- Confirm the Company's current stockholders' equity position as of the most recent quarter.