DASAN Zhone Announces Plans for Reverse Stock Split
Oakland, Calif. - Jan. 6, 2017 - DASAN Zhone Solutions, Inc. (NASDAQ: DZSI), a global leader in fiber access transformation for enterprise and service provider networks, announced today that its Board of Directors has authorized a reverse stock split at an exchange ratio of between 1-for-3 and 1-for-5 and a corresponding decrease in the number of authorized shares of the company's common stock on a proportional basis.
As previously announced, on September 12, 2016 the company received a letter from the Nasdaq Stock Market LLC ("Nasdaq") notifying the company that, because it did not satisfy Nasdaq's initial listing standard requiring a minimum bid price of $4 per share (or a minimum closing price of $3 per share for five consecutive trading days or $2 per share for 90 consecutive trading days) at the closing of the acquisition of Dasan Network Solutions, Inc., the company's common stock would be subject to delisting unless the company timely requested a hearing before the Nasdaq Hearings Panel (the "Panel"). On September 19, 2016, the company requested a hearing before the Panel, which was held on November 3, 2016. At the hearing, the company presented its plan to gain compliance with the initial listing minimum bid or closing price requirement, including via the implementation of a reverse stock split if necessary. On November 8, 2016, the company received a letter from Nasdaq stating that the Panel had granted the company's request for continued listing on the Nasdaq Capital Market, subject to the company evidencing compliance with the initial listing minimum bid or closing price requirement by March 13, 2017. If the company fails to implement the reverse stock split and demonstrate compliance by this date, the Panel will issue a final determination to delist the company's shares and suspend trading of the company's shares on Nasdaq. In an effort to maintain the listing of the Common Stock on the Nasdaq Capital Market the Board of Directors of the company has determined that a reverse stock split is the best alternative to comply with the initial listing minimum bid or closing price requirement of Nasdaq.
The reverse stock split is subject to the approval of the stockholders of the company. The company filed a preliminary proxy statement with the SEC today for a special meeting of its stockholders, at which such approval will be sought. The time, date, location and other details regarding the special meeting will be communicated to the company's stockholders at a later date. Although DASAN Zhone Solutions expects that the reverse stock split will enable the company to comply with the initial listing minimum bid or closing price requirement of Nasdaq, there can be no assurance that the company will be able to regain such compliance . Delisting from the Nasdaq Capital Market could have a material adverse effect on the company's business and on the trading of its common stock.
About DASAN Zhone Solutions
DASAN Zhone Solutions, Inc. (NASDAQ: DZSI) is a global leader in
broad-based network access solutions. The company provides solutions in
five major product areas including broadband access, Ethernet switching,
mobile backhaul, passive optical LAN (POL) and software defined networks
(SDN). More than 750 of the world's most innovative network
operators, service providers and enterprises turn to DASAN Zhone
Solutions for fiber access transformation. The IP Zhone is the only
solution that enables service providers to build the network of the
future today, supporting end-to-end voice, data, entertainment, social
media, business, mobile backhaul and mobility service. DASAN Zhone
Solutions is committed to building the fastest and highest quality All
IP Multi-Service solution for its customers. DASAN Zhone is
headquartered in Oakland, California.
This press release contains forward-looking statements that are subject
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compliance with initial listing minimum bid or closing price
requirements and the consequences of delisting of the company's
common stock from the Nasdaq Capital Market. Readers are cautioned that
actual results could differ materially from those expressed in or
contemplated by the forward-looking statements. Factors that could cause
actual results to differ include, but are not limited to, commercial
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and 8-K. Readers are cautioned not to place undue reliance on any
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Zhone, the Zhone logo, and all Zhone product names are trademarks of Zhone Technologies, Inc. Other brand and product names are trademarks of their respective holders. Specifications, products, and/or product names are all subject to change without notice.