BioRestorative Therapies’ 1-for-20 Reverse Stock Split Set to Take Effect

BioRestorative Therapies Inc. is scheduled to implement a 1-for-20 reverse stock split at 4:30 p.m. Eastern Time on September 7, a move the regenerative-medicine company says is intended to help it regain compliance with Nasdaq’s $1 minimum bid-price requirement. BRTX is due to begin trading on a split-adjusted basis when the Nasdaq Capital Market opens on September 8, keeping the BRTX ticker but moving to a new CUSIP number, 090655705.

At the effective time, every 20 issued and outstanding BioRestorative common shares will be consolidated into one share. Based on the 27,622,556 shares outstanding as of August 28, the company expects the count to fall to approximately 1,381,128 shares, subject to the treatment of fractional positions. The $0.0001 par value per common share will not change.

BioRestorative disclosed the mechanics in its September 2 Form 8-K after filing a Certificate of Change with Nevada. The board approved the reverse split by unanimous written consent on August 27. The company said shareholder approval was not required under Nevada law because the authorized common-share count is being reduced in the same proportion as the issued and outstanding share count.

The share count will fall sharply, but ownership percentages largely stay the same

A reverse stock split changes the number of shares representing an investor’s position without, by itself, changing that investor’s proportional economic interest. A holder of 2,000 BRTX shares immediately before the split would generally hold 100 shares afterward. The quoted share price would be expected to adjust upward mechanically to reflect the smaller number of shares, although the market price after trading resumes can move independently based on supply, demand and company-specific developments.

BioRestorative’s authorized common shares will also fall from 1.5 billion to 75 million at the effective time. Authorized preferred shares will remain unchanged at 20 million. The company said stock options, warrants and other equity awards will receive proportionate adjustments to the number of shares issuable and to applicable exercise or conversion prices. Shares reserved under the 2021 Stock Incentive Plan will be adjusted as well.

No fractional common shares will be issued to registered holders. Instead, a holder of record who would otherwise receive a fraction will receive one whole share, rounded up to the nearest whole share. Investors whose shares are held through a bank, broker or other nominee may be treated under that intermediary’s procedures, which can differ from the process for registered holders. BioRestorative’s transfer agent, TranShare Corporation, is responsible for providing instructions to holders of physical stock certificates.

The split does not create new operating cash for BioRestorative and it does not, on its own, improve the underlying value of the business. The company’s filings also caution that a higher post-split share price may not persist and that trading liquidity does not necessarily improve after a reverse split. Those points matter because the purpose here is listing compliance rather than a change in the company’s assets, liabilities or clinical programs.

Nasdaq’s minimum bid-price deadline arrives on September 22

BioRestorative received a Nasdaq deficiency notice on March 26 after its common stock closed below $1 for 30 consecutive business days. Nasdaq gave the company an initial 180-calendar-day compliance period, ending September 22. To regain compliance under the rule described in BioRestorative’s filings, BRTX must maintain a closing bid price of at least $1 per share for a minimum of 10 consecutive business days.

The planned September 8 start of split-adjusted trading therefore comes shortly before the end of the initial compliance window. A 1-for-20 ratio is designed to lift the per-share quotation well above where it would otherwise trade, but the company has not said the reverse split guarantees Nasdaq compliance. The market can reprice BRTX after the adjustment, and Nasdaq ultimately determines whether the listing requirement has been satisfied.

If BioRestorative does not regain bid-price compliance by September 22, its earlier filings say it may be eligible for a second 180-day period if it meets the other applicable Nasdaq Capital Market standards and satisfies the exchange’s conditions. The company has also warned that failure to maintain Nasdaq listing standards could make its shares harder to trade and could complicate future equity financing.

The reverse split leaves BioRestorative’s clinical and commercial programs unchanged. The company is developing BRTX-100, an autologous cell therapy for painful lumbosacral disc disorders, and also operates a biocosmeceutical business. The stock action is instead a capital-markets step aimed at the per-share trading threshold attached to its Nasdaq listing.

A separate Nasdaq filing deficiency remains unresolved

BioRestorative is also dealing with a separate Nasdaq compliance issue that the reverse split does not address. On August 21, the company received a delinquency notice because it had not timely filed its Form 10-Q for the quarter ended June 30, putting it out of compliance with Nasdaq Listing Rule 5250(c)(1). The company’s August 25 SEC filing said the notice had no immediate effect on BRTX’s listing.

Under that notice, BioRestorative has until October 20 to submit a plan to regain compliance with the periodic-reporting requirement. If Nasdaq accepts the plan, the exchange may grant an exception lasting as long as 180 calendar days from the original Form 10-Q due date, or until February 16, 2027. BioRestorative said it was working to complete the quarterly report and prepare a compliance plan.

The company’s quarterly-filings page, checked September 7, still lists an August 14 Form NT 10-Q notice as the latest entry for the June quarter and a May 14 Form 10-Q as its most recent completed quarterly report. That means the bid-price issue and the late-filing issue remain separate listing matters with different requirements and deadlines.

The next scheduled capital-markets milestone is 4:30 p.m. Eastern Time on September 7, when the Certificate of Change is due to become effective. Split-adjusted BRTX trading is then scheduled to begin at the September 8 market open. After that, the key bid-price test is whether the shares can satisfy Nasdaq’s required run of closing prices at or above $1 before the current September 22 deadline.