8-K: SurgePays Faces Nasdaq Delisting, Issues Shares to CEO

SurgePays, Inc. received notices from Nasdaq regarding non-compliance with minimum market value and bid price requirements, while also issuing 800,000 shares to its CEO to satisfy a debt.

Summary

• SurgePays, Inc. received a written notice from Nasdaq on March 18, 2026, indicating non-compliance with the minimum market value of listed securities (MVLS) requirement of $35,000,000.
• The company received a second written notice from Nasdaq on March 23, 2026, indicating non-compliance with the $1.00 minimum bid price requirement.
• SurgePays has 180 calendar days, until September 14, 2026, to regain compliance with the MVLS Requirement.
• The company also has 180 calendar days, until September 21, 2026, to regain compliance with the Bid Price Requirement.
• On or about March 23, 2026, SurgePays issued 800,000 shares of common stock to Brian Cox, the CEO and Chairman, at $1.25 per share.
• These shares were issued to satisfy a $1,000,000 debt owed by the company to Mr. Cox under a consolidated promissory note dated March 12, 2024.
• The share issuance was conducted under an exemption from registration requirements of the Securities Act, specifically Section 4(a)(2) and Rule 506(b) of Regulation D.

Sentiment

Score: 3

Explanation: StockSavvy.ai views this filing negatively due to the dual Nasdaq non-compliance notices, which signal significant operational and market challenges, despite the debt settlement with the CEO.

Positives

• The company successfully satisfied a $1,000,000 debt owed to its CEO, Brian Cox, through the issuance of common stock, avoiding a cash outflow for this liability.

Negatives

• Received a notice from Nasdaq for failing to meet the minimum market value of listed securities (MVLS) requirement of $35,000,000.
• Received a notice from Nasdaq for failing to meet the $1.00 minimum bid price requirement.
• Failure to regain compliance with Nasdaq's listing rules could result in the delisting of the company's securities.

Risks

• Failure to timely regain compliance with Nasdaq's MVLS and Bid Price requirements could lead to the delisting of the company's securities.
• Delisting could reduce the liquidity and market price of the company's common stock.
• Delisting could reduce the number of investors willing to hold or acquire the company's common stock, negatively impacting its ability to raise equity financing.
• Delisting could limit the company's ability to use a registration statement to offer and sell freely tradable securities, thereby preventing access to public capital markets.
• Delisting could impair the company's ability to provide equity incentives to its employees.
• There is a risk of a material delay in the company's ability to execute its plans.
• The possibility exists that the company may be unable to regain compliance with, or thereafter continue to comply with, Nasdaq's listing rules, or may violate additional listing rules.

Future Outlook

The company's management believes and expects to address the Nasdaq listing rules regarding MVLS and bid price, aiming to remain listed on Nasdaq. However, actual results could differ significantly due to various risks, including potential delays in executing plans and the possibility of failing to regain or maintain compliance.

Management Comments

• No specific notable quotes or paraphrased statements from company management are provided within the body of the filing, beyond the general forward-looking statements.

Industry Context

StockSavvy.ai notes that non-compliance with Nasdaq listing standards, particularly regarding minimum bid price and market value, is a common challenge for smaller or underperforming companies. While the issuance of shares to settle debt can be a non-cash way to manage liabilities, doing so with the CEO during a period of listing non-compliance could raise questions about corporate governance and shareholder value, especially if the stock price is struggling.

Comparison to Industry Standards

• StockSavvy.ai observes that maintaining Nasdaq listing requirements is a fundamental standard for publicly traded companies. Companies like Sorrento Therapeutics and Sesen Bio have faced similar delisting challenges due to bid price or market capitalization issues, often leading to significant share price volatility and reduced investor confidence. The current situation for SurgePays indicates a deviation from the stability expected of a Nasdaq-listed entity, contrasting with companies that consistently meet or exceed these benchmarks.

Related Party Transactions

• The company issued 800,000 shares of common stock to Brian Cox, the CEO and Chairman, at $1.25/share to satisfy a $1,000,000 debt owed under a consolidated promissory note.

Stakeholder Impact

• Shareholders: Potential negative impact on liquidity and market price of common stock due to delisting risk; potential dilution from shares issued to the CEO.
• Employees: Impairment of the company's ability to provide equity incentives if delisted.
• Creditors: One creditor (CEO Brian Cox) had a $1,000,000 debt satisfied through a non-cash transaction.

Next Steps

• Regain compliance with Nasdaq's MVLS Requirement by September 14, 2026, by having the MVLS close at $35,000,000 or more for a minimum of ten consecutive business days.
• Regain compliance with Nasdaq's Bid Price Requirement by September 21, 2026, by having the common stock close at or above $1.00 per share for a minimum of ten consecutive business days.
• If failing to regain Bid Price compliance, the company may be eligible for an additional 180-day period if it meets other listing requirements and provides written notice to Nasdaq.

Key Dates

Recommendation

The dual notices of non-compliance from Nasdaq regarding minimum market value and bid price indicate severe underlying issues with the company's valuation and market perception. The risk of delisting is substantial and would significantly impair liquidity, access to capital, and investor confidence. While debt was settled with the CEO, this does not offset the fundamental concerns raised by the potential delisting. Investors should consider selling to mitigate further downside risk.

Keywords

SurgePays, Nasdaq, delisting, MVLS, bid price, compliance, equity issuance, debt settlement, common stock, SEC filing, 8-K