Datasea Inc (DTSS)

Datasea Inc (DTSS) stock dropped by 18.81% due to the company's announcement of a reverse stock split, which had an impact on investor sentiment.

• Details of the Reverse Stock Split: Datasea Inc, a Nevada corporation engaged in U.S.-based intelligent acoustics and China-based 5G messaging technology, disclosed that its Board of Directors had approved a reverse stock split of its authorized and issued outstanding shares of common stock, each with a par value of $0.001 per share. This reverse stock split was approved at a ratio of 1-for-15. The company initiated this action to regain compliance with the minimum bid price requirement of $1.00 for continued listing on The Nasdaq Capital Market, as mandated by Nasdaq Listing Rule 5550(a)(2). It's important to note that the reverse stock split did not require the approval of the company's stockholders, as it was approved in accordance with Nevada Revised Statutes Section 78.207. Under the reverse stock split, every 15 issued and outstanding shares of the company's Common Stock were to be automatically converted into one share of the company's Common Stock without any change in the par value per share. Consequently, the total number of shares of Common Stock authorized for issuance was to be reduced proportionally, decreasing from 375,000,000 shares to 25,000,000 shares of Common Stock.
• Impact on Ownership and Voting: Importantly, after the reverse stock split, each stockholder's percentage ownership interest in the company and their proportional voting power was to remain unchanged. The reverse stock split was designed to have minimal effects on the rights and privileges of the holders of Common Stock, with minor changes and adjustments occurring due to the rounding up of any fractional shares to the next whole number of shares. In summary, Datasea Inc's announcement of a reverse stock split aimed at regaining compliance with Nasdaq's minimum bid price requirement led to a notable decline in the company's stock price. Investors and the market reacted to this corporate action, which sought to address listing compliance concerns.