{"url_path":"/sec/dyai/10-q/2026/item-1a","section_key":"item-1a","section_title":"Item 1A Risk Factors**","topic":"sec","document":{"doc_type":"10-Q","doc_date":"2026-05-13","source_url":"https://www.sec.gov/Archives/edgar/data/1213809/0001493152-26-022722-index.html","accession_number":"0001493152-26-022722","cik":"0001213809","ticker":"DYAI","issuer_name":"DYADIC INTERNATIONAL INC","edgar_url":"https://www.sec.gov/Archives/edgar/data/1213809/0001493152-26-022722-index.html","primary_entity_key":"0001213809","primary_entity_name":"DYADIC INTERNATIONAL INC"},"word_count":1039,"has_tables":true,"body_markdown":"**Item\n1A. Risk Factors**\n\n** **\n\nExcept as set forth below,\nthere have been no changes to our risk factors from those disclosed in our Annual Report.\n\n \n\n**If we fail to comply\nwith listing standards of Nasdaq, our common stock may be delisted, adversely affecting the liquidity and market price of our common stock,\nas well as our ability to obtain sufficient additional capital to fund our operations and to continue to operate as a going concern.**\n\n \n\nOur common stock is currently\nlisted on the Nasdaq Capital Market, which has minimum requirements that a company must meet in order to remain listed. As previously\ndisclosed, we are currently not in compliance with various of these requirements.\n\n \n\nWe are currently not in compliance\nwith the requirement that our common stock maintain a minimum bid price per share of $1.00 (such that the share price of the common stock\nclose not below $1.00 for 30 consecutive business days) (the “Minimum Bid Price Rule”). We would regain compliance with the\nMinimum Bid Price Rule if our common stock reached a closing price of at least $1.00 for a minimum of ten consecutive business days by\nthe end of the applicable compliance deadline. In May, 2026, we filed a definitive proxy statement soliciting shareholder approval\nat our annual meeting for authorization for our Board to effect a reverse stock split, as a possible way to cure our Minimum Bid Price\nRule deficiency (to the extent deemed by Board as in the best interests of us and our shareholders). However, given the timing of that\nmeeting, we will be unable to cure the Minimum Bid Price Rule by Nasdaq’s initial compliance deadline of June 17, 2026, unless our\ncommon stock price independently increases to the required level by then. We intend to take all steps, provided in the best interests\nof us and our shareholders, to preserve our eligibility under Nasdaq rules for an additional period of up to 180 days to regain compliance\nwith the Minimum Bid Price Rule, through December 15, 2026 (the “Additional Compliance Period”). Nasdaq may grant this extension\nin its discretion if on June 17, 2026, we meet the applicable market value of publicly held shares requirement for continued listing and\napplicable standards for initial listing on the Nasdaq Capital Market, including shareholders’ equity of $5 million. There can be\nno assurance that we will meet the requirements to receive an Additional Compliance Period, or that actions we taken to meet these requirements,\nincluding potential capital raises, will be executed on favorable terms or will not be dilutive to existing shareholders. To the extent\nthat we do not obtain an Additional Compliance Period, and the closing price of the common stock price does not increase independently\nto allow us to regain compliance with the Minimum Bid Price Rule by June 17, 2026, Nasdaq will begin delisting proceedings for our common\nstock, subject to our right to appeal to a Nasdaq hearing panel. The Board may then determine to effect a reverse stock split (assuming\nsuch split is approved by shareholders) during the pendency of the delisting proceedings, as support for the Company’s contention\non appeal before the Nasdaq hearing panel that Nasdaq should not delist the common stock. There can be no assurance that Nasdaq will not\nthen determine to delist our common stock, even if we have cured the Minimum Bid Price Rule deficiency during the pendency of the listing\nproceedings. To the extent that we successfully obtain an Additional Compliance Period, and the closing price of the common stock price\ndoes not increase independently to allow us to regain compliance with the Minimum Bid Price Rule by December 15, 2026, the Board may determine\nto effect a reverse stock split (assuming such split is approved by shareholders) before the end of the Additional Compliance Period. \n\n \n\nWe are also not in compliance\nwith a separate Nasdaq continued listing requirement, which requires us to meet any of the following minimum conditions: $2.5 million\nin shareholders’ equity; $35 million in market value of listed securities; or $500,000 of net income from continuing operations\n(the “Continued Listing Standards”). We have until September 23, 2026 (provided that Nasdaq accepts our recently-submitted\ncompliance plan) to regain compliance with this rule. Thus, even if we cure the Minimum Bid Price Rule through a reverse stock split,\nwe may also be unable to cure or remain in compliance with the Continued Listing Standards, which could also result in us receiving a\ndelisting notice, subject to appeal, or we may fail to maintain compliance with other Nasdaq rules. There can be no assurance that,\nif we decide to appeal any delisting determination by Nasdaq to the panel, such appeal would be successful.\n\n \n\nIf our common stock is delisted from Nasdaq as a result of our failure to comply with the Minimum Bid Price Requirement,\nthe Continued Listing Standards or any other requirement for continued listing on Nasdaq, trading of our common stock could be conducted\nin the over-the-counter market established for unlisted securities such as the OTCQX, the OTCQB, the OTCID Basic Market or the Pink Limited\nMarket, but there can be no assurance that our common stock will be eligible for trading on any such alternative market. Additionally,\nthe liquidity of our common stock would be adversely affected, the market price of our common stock could decrease, our ability to obtain\nsufficient additional capital to fund our operations and to continue to operate as a going concern would be substantially impaired and\ntransactions in our common stock could lose federal preemption of state securities laws. Furthermore, there could be a reduction in our\ncoverage by securities analysts, and broker-dealers may be deterred from making a market in or otherwise seeking or generating interest\nin our common stock, which could cause the price of our common stock to decline further. Moreover, delisting may also negatively affect\nour collaborators’, vendors’, suppliers’ and employees’ confidence in us and employee morale. If we effected a\nreverse stock split (assuming such split is approved by our shareholders), the liquidity of our common stock could be harmed, given the\nreduced number of shares of common stock that would be outstanding afterward, particularly if the share price does not increase as a result\nthereof."}