Sow Good Inc. Receives Nasdaq Non-Compliance Notice and Enters Sales Agreement for Equity Offering

Key Points for Investors

• Nasdaq Non-Compliance Notice: Sow Good Inc. has received a formal notice from the Nasdaq Capital Market indicating the company is not in compliance with the minimum stockholders’ equity requirement of \$2.5 million as mandated by Nasdaq Listing Rule 5550(b)(1).
• Timeline to Regain Compliance: The company has 45 calendar days from April 7, 2026 (i.e., until May 22, 2026) to submit a plan to Nasdaq outlining how it will regain compliance. If the plan is accepted, Nasdaq may grant an extension of up to 180 calendar days, until October 4, 2026, to reach the required equity level.
• “At-the-Market” Equity Offering: Sow Good Inc. has entered into a Sales Agreement, dated April 13, 2026, with Craft Capital Management, LLC, allowing for the sale of shares of its common stock through an “at-the-market” equity program. This is designed to provide the company with flexibility to raise capital as needed.
• Legal Opinion: White & Case LLP has provided a legal opinion confirming that the shares offered under the Sales Agreement, when issued and sold against payment, will be validly issued, fully paid, and nonassessable.
• Stock Details: The company’s common stock (par value \$0.001 per share) trades under the symbol SOWG on the Nasdaq Capital Market.
• No Other “At-the-Market” Agreements: The company confirmed it is not party to any other concurrent ATM (at-the-market) or continuous equity transaction programs.
• Forward-Looking Statements: The company states that all forward-looking statements have been made in good faith and with a reasonable basis.

Important Information for Shareholders

• Potential Nasdaq Delisting Risk:
  • Failure to regain compliance with Nasdaq’s equity requirement could lead to the company’s shares being delisted from the Nasdaq Capital Market, which may significantly affect share liquidity and value.
  • The company is taking steps (such as the equity offering) to address this risk, but there is no guarantee that the plan will be accepted or that compliance will be regained within the permitted timeframe.
• Potential Share Dilution:
  • The Sales Agreement allows Sow Good Inc. to sell additional shares into the market. While this provides capital, it may also dilute existing shareholders if a significant number of shares are issued.
  • The company will not sell Placement Shares if such sales would cause the total number or gross proceeds of shares sold to exceed the amount registered or authorized by its board of directors, or the amount available under the effective registration statement.
• Financial Health and Controls:
  • Sow Good Inc. and its subsidiaries are represented as being duly organized, in good standing, and having good title to their material property and assets.
  • The company affirms it is not a shell company and maintains effective internal controls over financial reporting and disclosure procedures as required by the Sarbanes-Oxley Act.
• Use of Proceeds:
  • Net proceeds from the sale of Placement Shares will be used as described in the company’s prospectus under “Use of Proceeds.”
• Ongoing Disclosure and Compliance:
  • The company commits to keeping financial statements and disclosures up to date, and to promptly file required reports with the SEC to maintain transparency.
  • The company will not take actions designed to manipulate the price of its shares in violation of applicable regulations (e.g., Regulation M).

Potential Price-Sensitive Developments

• Nasdaq Non-Compliance Notice: This notice is material and could negatively impact investor confidence and share price due to the risk of delisting.
• Equity Offering (Sales Agreement): The ATM equity program gives Sow Good Inc. the flexibility to raise capital, which could help address the compliance deficiency but may also lead to share dilution, impacting share value.
• Regulatory and Legal Affirmations: The company’s legal opinion and compliance statements provide assurance but do not eliminate the risks associated with dilution or potential delisting.

Summary for Investors

Sow Good Inc. is at a pivotal moment, facing the risk of Nasdaq delisting due to non-compliance with the minimum stockholders’ equity requirement. The company is proactively addressing this by initiating an “at-the-market” equity offering, which, if successful, could restore compliance but may also dilute existing shareholders. Investors should closely monitor further disclosures, the company’s plan submission to Nasdaq, and the results of the equity offering, as these factors may have a significant impact on the company’s share price and ongoing listing status.

Disclaimer: This article is for informational purposes only and does not constitute investment advice or a solicitation to buy or sell any securities. Investors should conduct their own due diligence and consult with professional advisors before making investment decisions. The information is based on publicly available filings as of the date referenced and may be subject to change without notice.

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