Our stock price does not currently meet the minimum bid price for continued listing on
Nasdaq. Our ability to continue operations or to publicly or privately sell equity securities and the liquidity of our common stock could be adversely affected if we are delisted from Nasdaq.
Our common stock is currently listed on the Nasdaq Global Market. In order to maintain that listing, we must satisfy minimum financial and
other continued listing requirements and standards. One such requirement is that we maintain a minimum bid price of at least $1.00 per share for our common stock. On December 24, 2018, we received written notification from Nasdaq informing us
that because the closing bid price of our common stock was below $1.00 for 30 consecutive trading days, our shares no longer complied with the minimum closing bid price requirement for continued listing on the Nasdaq Global Market under Nasdaq
Marketplace Rule 5450(a)(1).
We were initially provided until June 24, 2019, to regain compliance with Nasdaqs listing
requirements by having the closing bid price of our common stock listed on Nasdaq be at least $1.00 for at least 10 consecutive trading days. However, as of the date of this filing, we do not expect to have regained compliance within this time
period. Under the Nasdaq rules, we may transfer our common stock listing to the Nasdaq Capital Market, provided that we (i) meet the applicable market value of publicly held shares requirement for continued listing and all other applicable
requirements for initial listing on the Nasdaq Capital Market (except for the closing bid price requirement) and (ii) notify Nasdaq of our intent to cure this deficiency. Following a transfer to the Nasdaq Capital Market, we would be afforded
an additional 180 calendar day grace period in order to regain compliance with the minimum closing bid price requirement of $1.00 per share under the Nasdaq Capital Market, unless it does not appear to Nasdaq that it would be possible for us to cure
the deficiency.
On June 7, 2019, we filed an application to transfer the listing of our common stock from the Nasdaq Global Market
to the Nasdaq Capital Market, which, if approved, would provide an additional
180-day
grace period to come into compliance with the minimum closing bid price requirement. As part of our application, we
notified Nasdaq of our intent to cure this deficiency, which may include implementing a reverse stock split during the additional grace period, if necessary. We anticipate that the transfer will be effective on or about June 25, 2019, and that
our common stock will continue to trade on the Nasdaq Capital Market under the symbol DRRX.
If compliance is not demonstrated
within the applicable compliance period, Nasdaq will notify us that our securities will be subject to delisting. We may appeal Nasdaqs determination to delist our securities to a Hearings Panel. During any appeal process, shares of our common
stock would continue to trade on the Nasdaq Global Market or Nasdaq Capital Market, as applicable.
There can be no assurance that we will
maintain or regain compliance with the requirements for listing our common stock on the Nasdaq Global Market or if we were not in compliance, that our common stock would be eligible for transfer to the Nasdaq Capital Market and remain in compliance
with the requirements for listing on that market.
Delisting from the Nasdaq Capital Market would constitute an event of default under our
loan facility with Oxford, entitling Oxford to accelerate our obligations under such facility, among other actions. Under such circumstances, we could be required to renegotiate the repayment terms of our loan facility, on terms which would not be
favorable to us as our current terms, or we could be required to take other actions, such as discontinuing some or all of our operations, selling assets or other action. Delisting could also adversely affect our ability to raise additional financing
through the public or private sale of equity securities, which would significantly affect the ability of investors to trade our securities and would negatively affect the value and liquidity of our common stock. Delisting could also have other
negative results, including the potential loss of confidence by employees, the loss of institutional investor interest and fewer business development opportunities.
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