8-K: Vislink Technologies Announces Voluntary Delisting from Nasdaq, Eyes OTC Market

Vislink Technologies intends to delist from the Nasdaq Capital Market and deregister its common stock, citing costs and lack of active trading as key factors.

Summary

• Vislink Technologies has announced its intention to voluntarily delist its common stock from the Nasdaq Capital Market.
• The company plans to file Form 25 with the SEC around February 10, 2025, to initiate the delisting process.
• Delisting is expected to be effective 10 days after the Form 25 filing.
• Following delisting, Vislink intends to deregister its common stock under the Exchange Act by filing a Form 15 with the SEC.
• The company has applied for its common stock to trade on the over-the-counter (OTC) market.
• The Board of Directors determined that delisting and deregistration are in the best interest of the company and its shareholders.
• Reasons for the decision include the lack of an active trading market, the expenses associated with SEC and Nasdaq reporting requirements, and the burden on management's time.
• Vislink believes delisting will allow them to focus on developing new products and customers.
• The company cautions that there is no guarantee that trading on the OTC market will commence or be maintained.

Sentiment

Score: 4

Explanation: The announcement of delisting is generally negative, but the company frames it as a strategic move to improve focus and reduce costs. The lack of guaranteed OTC trading and potential loss of investor confidence temper any positive spin.

Positives

• The company anticipates significant savings in time and resources by delisting.
• Management believes they can better focus on product development and customer acquisition.
• The company intends to have its stock traded on the OTC market, providing some liquidity for shareholders.

Negatives

• The company's stock will no longer be listed on the Nasdaq Capital Market.
• There is no guarantee that a broker will continue to make or maintain a market in the common stock on the OTC market.
• Delisting may reduce the visibility and prestige of the company.

Risks

• The delisting and deregistration process may take longer than expected.
• The anticipated benefits of delisting may not be realized.
• Trading on the OTC market may not commence promptly or be maintained.
• The company faces risks and uncertainties described in its SEC filings, including its Annual Report on Form 10-K.

Future Outlook

Vislink expects to file a Form 25 with the SEC and Nasdaq relating to the delisting of its Common Stock on or about February 10, 2025 and expects that the Common Stock will be quoted for trading on a market operated by the OTC Markets Group Inc.

Management Comments

• Mickey Miller, CEO of Vislink, stated that delisting will help the company realize significant savings in both time and resources.
• Miller believes this will allow them to better focus their energies on developing new products and customers that will deliver greater shareholder value in the long term.

Industry Context

Companies sometimes delist from major exchanges to reduce compliance costs and focus on core operations, especially if they face challenges in maintaining listing requirements or have limited trading activity. This is a strategic decision that can impact investor perception and access to capital.

Comparison to Industry Standards

• Delisting from major exchanges to trade on the OTC market is a strategy sometimes employed by smaller companies seeking to reduce regulatory burdens.
• Compared to companies like Akoustis Technologies, which has focused on maintaining its Nasdaq listing to attract institutional investors, Vislink is taking a different approach by prioritizing cost savings and operational focus.
• Other companies, such as those in the cannabis industry facing regulatory hurdles, have also considered or pursued OTC trading as an alternative to major exchange listings.

Stakeholder Impact

• Shareholders may experience reduced liquidity and potentially lower stock valuation.
• Employees may be affected by the company's restructuring and cost-cutting measures.
• Customers and suppliers may be impacted by the company's shift in focus and product development efforts.

Next Steps

• File Form 25 with the SEC and Nasdaq on or about February 10, 2025.
• Deregister the Common Stock under the Exchange Act by filing a Form 15 with the SEC.
• Transition trading of the Common Stock to the OTC market.

Key Dates