Professional Diversity Network Inc

In addition to other information set forth in this report, you should carefully consider the risk factors described in Part I, Item 1A, ‎‎“Risk Factors” in our 2023 Annual Report on Form 10-K, which could materially affect our business, financial condition or future ‎results. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially ‎and adversely affect our business, financial condition and/or operating results.‎

Except as updated below, there have been no material changes from the risk factors previously disclosed in our 2023 Annual Report on Form 10-K.

If we are unable to regain and maintain compliance with Nasdaq continued listing standards, including maintenance of at least $2.5 million of stockholders’*** equity and maintenance of a $1.00 minimum bid price, our common stock may be delisted from The Nasdaq Stock Market.***

As we have previously disclosed, on May 21, 2024, we received a letter from The Nasdaq Stock Market (“Nasdaq”) notifying us that we were not in compliance with the minimum stockholders’ equity requirement for continued listing on The Nasdaq Capital Market because we reported stockholders’ equity of less than $2.5 million in our Quarterly Report on Form 10-Q for the period ended March 31, 2024, and we did not meet the alternative tests for market value of listed securities or net income from continuing operations. In accordance with the notice, within 45 days of receiving the letter, we submitted a plan to regain compliance with the minimum stockholders’ equity standard. Based on the Nasdaq staff’s review of our plan, Nasdaq granted us an extension of 180 calendar days from the date of the notification letter to regain compliance (i.e., until November 17, 2024). If we regain compliance by November 17, 2024, Nasdaq will continue to monitor our ongoing compliance and, if at the time our next period report is filed with the SEC we do not evidence continued compliance, our common stock may be subject to delisting. In order to regain compliance, we will need to raise capital through the sale of equity securities. There can be no assurance that we will be able to regain compliance.

On June 27, 2024, we received a separate notice that we were not in compliance with the minimum bid price requirement for continued listing on The Nasdaq Capital Market because for the prior 30 consecutive trading days, the closing bid price of our common stock was below the $1.00 per share minimum required. Nasdaq listing rules provide for a compliance period of 180 calendar days (i.e., until December 24, 2024) in which to regain compliance. We will regain compliance if the closing bid price of our common stock is $1.00 per share or higher for a minimum period of ten consecutive business days during this compliance period. In the event we do not regain compliance, we may be eligible for additional time. To qualify, we will be required to meet the continued listing requirement for market value of publicly held shares and all other initial listing standards for The Nasdaq Capital Market, with the exception of the bid price requirement, and will need to provide written notice of our intention to cure the deficiency during a second compliance period, by effecting a reverse stock split if necessary. If we meet these requirements, Nasdaq will inform us that we have been granted an additional 180 calendar days. However, if it appears to the staff of Nasdaq that we will not be able to cure the deficiency, or if we are otherwise not eligible, Nasdaq will provide notice that our securities will be subject to delisting.

There can be no assurance that we will be able to regain compliance with these listing requirements and maintain our Nasdaq listing in the future. In the event we are unable to regain and maintain compliance with Nasdaq continued listing standards and our common stock is delisted from Nasdaq, it could likely lead to a number of negative implications, including an adverse effect on the price of our common stock, reduced liquidity in our common stock, the loss of federal preemption of state securities laws and greater difficulty in obtaining financing including through public or private sales of equity securities. Delisting also could have other negative results, including the potential loss of employee confidence, the loss of institutional investors or interest in business development opportunities. In the event of a delisting, we would take actions to restore our compliance with Nasdaq’s continued listing standards, but we can provide no assurance that any such action taken by us would allow our common stock to become listed again, stabilize the market price or improve the liquidity of our common stock, prevent our common stock from dropping below the Nasdaq minimum bid price requirement or prevent future non-compliance with Nasdaq’s continued listing requirements.