MILWAUKEE, Feb. 21, 2019 /PRNewswire/ -- EnSync, Inc. (NYSE American: ESNC), dba EnSync Energy Systems (the "Company"), which is creating the future of electricity with innovative residential and commercial distributed energy resource (DER) systems and Internet of Energy (IOE) control platforms, reported that on February 18, 2019 it received a deficiency letter from the NYSE American LLC (the "Exchange") informing the Company that it is not in compliance with the Exchange's continued listing standards as set forth in Sections 801(h), 804 and 805 of the Exchange's Company Guide (the "Company Guide"). Specifically, given the fact that the Company's four independent directors resigned on February 11, 2019, the Exchange has determined the Company does not meet the requirements of Section 801(h) as it does not have (i) a board of directors consisting of at least 50% independent directors or (ii) an audit committee comprised of at least two independent members. Furthermore, Rule 10A-3 of the Securities and Exchange Act of 1934, as amended, requires an audit committee consisting of one independent member. Additionally, the Company does not have sufficient independent directors to fulfill the requirements with respect to board nominations and executive compensation required by Sections 804 and 805 of the Company Guide. The Company's continued listing on the Exchange is predicated on (i) appointing one independent director to the Company's board of directors and audit committee no later than March 18, 2019 and (ii) regaining compliance with all other corporate governance requirements of Part 8 of the Company Guide no later than April 18, 2019.
In the interim, the Company's common stock will continue to be listed on the Exchange, subject to the Company's compliance with other continued listing requirements, and will continue to trade under the symbol "ESNC," with the added designation of ".BC" to indicate that the Company is below compliance with the Exchange's listing standards. The Exchange also publishes a list of noncompliant issuers and displays the .BC indicator on its website.
On February 20, 2019, the Company received a separate deficiency letter from the Exchange informing the Company that it is not in compliance with the Exchange's continued listing standards as the Company failed to timely file its Quarterly Report on Form 10-Q for the period ended December 31, 2018 (the "Delinquent Report"), which was due to be filed with the Securities and Exchange Commission ("SEC") no later than February 14, 2019 (collectively the "Filing Delinquency").
As a result of the foregoing, the Company has become subject to the procedures and requirements of Section 1007 of the Company Guide. During the six-month period from the date of the Filing Delinquency (the "Initial Cure Period"), the Exchange will monitor the Company and the status of the Delinquent Report and any subsequent reports until the Filing Delinquency is cured. If the Company fails to cure the Filing Delinquency within the Initial Cure Period, the Exchange may, in its sole discretion, allow the Company's securities to be traded for up to an additional six-month period (the "Additional Cure Period"), depending on the Company's specific circumstances. If the Exchange determines that an Additional Cure Period is not appropriate, suspension and delisting procedures will commence in accordance with the procedures set forth in Section 1010 of the Company Guide.
Notwithstanding the foregoing, however, the Exchange may in its sole discretion decide (i) not to afford the Company any Initial Cure Period or Additional Cure Period, as the case may be, at all or (ii) at any time during the Initial Cure Period or Additional Cure Period, to truncate the Initial Cure Period or Additional Cure Period, as the case may be. Furthermore, the Exchange may immediately commence suspension and delisting procedures if the Company is subject to delisting pursuant to any other provision of the Company Guide, including if the Exchange believes, in its sole discretion, that continued listing and trading of the Company's securities on the Exchange is inadvisable or unwarranted in accordance with Sections 1001-1006 of the Company Guide.
In the interim, the Company's common stock will continue to be listed on the Exchange, subject to the Company's compliance with other continued listing requirements, and will continue to trade under the symbol "ESNC." The Exchange will make a late filer (".LF") indicator available on the consolidated tape. Each data vendor that disseminates the quotes and trades of Exchange-listed issuers may append this indicator to the ticker symbol of the Company. Each vendor is free to use an indicator of its own choosing so the letter or symbol used to indicate this status may differ from vendor to vendor. The Exchange also publishes a list of noncompliant issuers and displays the .LF indicator on its website.
As previously disclosed in the Company's Current Report on Form 8-K filed with the SEC on February 12, 2019, the Company has a very short term need for additional financing; however, the Company currently has no commitments to obtain any additional financing and if it does not obtain sufficient financing in the very near term it will likely need to discontinue operations and initiate insolvency proceedings. Accordingly, the Company has continued to actively pursue additional financing and take steps to reduce costs. To this end, on February 14, 2019, the Company conducted a reduction-in-force, impacting approximately 25 employees of the Company.
About EnSync Energy Systems
EnSync, Inc. (NYSE American: ESNC), dba EnSync Energy Systems (EnSync Energy), is creating the future of electricity with innovative distributed energy resource (DER) systems and internet of energy (IOE) control platforms. EnSync Energy ensures the most cost-effective and resilient electricity, delivered from an electrical infrastructure that prioritizes the use of all available resources, such as renewables, energy storage and the utility grid. As project developer, EnSync Energy's distinctive engagement methodology encompasses load analysis, system design consulting, and technical and financial modeling to ensure energy systems are sized and optimized to meet our customers' objectives for value and performance. Proprietary direct current (DC) power control hardware, energy management software, and extensive experience with numerous energy storage technologies uniquely positions EnSync Energy to deliver fully integrated systems that provide for efficient design, procurement, commissioning, and ongoing operation. EnSync Energy's IOE control platform adapts easily to ever-changing generation and load variables, as well as changes in utility prices and programs, ensuring the means to make or save money behind-the-meter, while concurrently providing utilities the opportunity to use DERs for an array of grid enhancing services. In addition to direct system sales, EnSync Energy includes power purchase agreements (PPAs) in its portfolio of offerings, which enables electricity savings for customers and provides a stable financial yield for investors. EnSync Energy is a global corporation, with joint venture Meineng Energy in AnHui, China, and energy project development subsidiary Holu Energy LLC in Hawaii. For more information, visit www.ensync.com.
Safe Harbor Statement
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, that are intended to be covered by the "safe harbor" created by those sections. Forward-looking statements, which are based on certain assumptions and describe our future plans, strategies and expectations, can generally be identified by the use of forward-looking terms such as "believe," "expect," "may," "will," "should," "could," "seek," "intend," "plan," "goal," "estimate," "anticipate" or other comparable terms. All statements other than statements of historical facts included in this press release regarding our strategies, prospects, financial condition, operations, costs, plans and objectives are forward-looking statements. Examples of forward-looking statements include, among others, statements we make regarding project completion timelines, our ability to monetize our PPA assets, statements regarding the sufficiency of our capital resources, expected operating losses, expected revenues, expected expenses and our expectations concerning our business strategy. Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, the following: our historical and anticipated future operation losses and our ability to continue as a going concern; our ability to raise the necessary capital to fund our operations and the risk of dilution to shareholders from capital raising transactions; our ability to successfully commercialize new products, including our EnSync Smart Home Energy System, Matrix TM Energy Management, DER Flex TM, DER SuperModule TM, and Agile TM Hybrid Storage Systems; our ability to lower our costs and increase our margins; our product, customer and geographic concentration, and lack of revenue diversification; the length and variability of our sales cycle; our dependence on governmental mandates and the availability of rebates, tax credits and other economic incentives related to alternative energy resources and the regulatory treatment of third-party owned solar energy systems; and the other risks and uncertainties described in the Risk Factors and in Management's Discussion and Analysis of Financial Condition and Results of Operations sections of our most recently filed Annual Report on Form 10-K and our subsequently filed Quarterly Report(s) on Form 10-Q. We undertake no obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise.
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SOURCE EnSync, Inc.