Item 8.01. Other Event.
Market Value of Listed Securities Requirement
On July 9, 2020, Novan, Inc. (the "Company"), received written notice from the
Listing Qualifications Staff of the Nasdaq Stock Market LLC ("Nasdaq") notifying
the Company that over the previous 10 consecutive business days, from June 23,
2020 to July 8, 2020, the Company's market value of listed securities had been
$50,000,000 or greater. Accordingly, the Company has regained compliance with
the market value of listed securities listing requirement set forth
under Nasdaq Listing Rule 5450(b)(2)(A).
Minimum Bid Price Requirement
As previously disclosed, on February 19, 2020, the Company received a letter
from the staff of the Listing Qualifications Department of Nasdaq indicating
that the Company was not in compliance with Nasdaq Listing Rule 5450(a)(1)
because the closing bid price for the Company's common stock had closed below
$1.00 per share for the previous 30 consecutive business days (the "Minimum Bid
Price Requirement").
As also previously disclosed, on April 17, 2020, the Company received a letter
from the staff of the Listing Qualifications Department of Nasdaq indicating
that, due to extraordinary market conditions, Nasdaq had tolled the compliance
period for the Minimum Bid Price Requirement through June 30, 2020 (the "tolling
period"), and that on April 16, 2020, Nasdaq filed an immediately effective rule
change with the Securities and Exchange Commission to implement the tolling
period. The letter indicated that upon expiration of the tolling period and
beginning on July 1, 2020, the Company would receive the balance of days
remaining under its currently pending compliance period in effect at the rule
change date. Accordingly, upon expiration of the tolling period and beginning on
July 1, 2020, the Company has 123 calendar days from July 1, 2020, or until
November 2, 2020, to regain compliance with the Minimum Bid Price Requirement.
To regain compliance, the closing bid price of the Company's common stock must
meet or exceed $1.00 per share for a minimum of 10 consecutive business days
prior to November 2, 2020.
The Company intends to actively monitor the Minimum Bid Price Requirement and
other continued listing requirements and, as appropriate, will consider
available options to resolve any deficiencies as to those requirements and
regain compliance with those requirements, as applicable.
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