SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): MAY 11, 2004
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CATUITY INC.
(Exact name of registrant as specified in its charter)
DELAWARE 000-30045 38-3518829
(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification No.)
2711 E. JEFFERSON AVE.
DETROIT, MICHIGAN 48207 (313)-567-4348
(Address of principal (Registrant's telephone number,
executive offices) including area code)
NOT APPLICABLE
(Former name or former address, if changed since last report)
ITEM 5. OTHER EVENTS
On May 7, 2004 Catuity received notice from the Nasdaq stock market that its
daily minimum bid price had fallen, and remained, below $1.00 for 30 consecutive
business days. As a result, Catuity is out of compliance with Nasdaq's $1.00
minimum bid price for continued inclusion.
In accordance with Section 4310 of the Nasdaq Marketplace Rules, Catuity has 180
calendar days from its May 7, 2004 notification date to achieve compliance.
The Company will seek to regain compliance within the 180 day period, but has
not made a final determination as to what specific action(s) it will take in
order to do so. No assurance can be given that compliance will in fact be
regained. Catuity intends to announce its updated strategy plans at its Annual
Shareholder Meeting to be held at 9:30 AM on Thursday May 13, 2004 in Sydney
Australia (7:30 PM on Wednesday May 12, 2004 EDT in the United States). The
Company may also consider a reverse stock split as one potential means to
achieve compliance.
The following is provided as further information for Catuity's shareholders
regarding additional Nasdaq Marketplace Rules that provide for regaining
compliance with the $1.00 minimum bid price requirement for continued inclusion.
The Marketplace Rules also provide that, if Catuity has not been deemed in
compliance prior to the expiration of the (first) 180 day compliance period, it
shall be afforded an additional 180 day compliance period, provided, that on the
180th day of the first compliance period, it demonstrates that it meets the
criteria for initial inclusion set forth in Rule 4310(c) (except for the bid
price requirement set forth in Rule 4310(c)(4)) based on its most recent public
filings and market information. If Catuity has publicly announced information
(e.g., in an earnings release) indicating that it no longer satisfies the
applicable initial inclusion criteria, it shall not be eligible for the
additional compliance period.
The Marketplace Rules further provide that, if on the 180th day of the second
compliance period, Catuity has not been deemed in compliance during such
compliance period but it satisfies the criteria for initial inclusion set forth
in Rule 4310(c) (except for the bid price requirement set forth in Rule
4310(c)(4)), it shall be provided with an additional compliance period up to its
next shareholder meeting scheduled to occur no later than two years from the
original notification of the bid price deficiency, provided it commits to seek
shareholder approval at that meeting for a reverse stock split to address the
bid price deficiency. If Catuity fails to timely propose, or obtain approval
for, or promptly execute the reverse stock split, Nasdaq shall immediately
institute delisting proceedings upon such failure. Compliance can be achieved
during any compliance period by meeting the applicable standard for a minimum of
10 consecutive business days.
Nasdaq may, in its discretion, require Catuity to maintain a bid price of at
least $1.00 per share for a period in excess of ten consecutive business days,
but generally no more than 20 consecutive business days, before determining that
the Company has demonstrated an ability to maintain long-term compliance. In
determining whether to monitor bid price beyond ten business days, Nasdaq will
consider the following four factors: (i) margin of compliance (the amount by
which the price is above the $1.00 minimum standard); (ii) trading volume (a
lack of trading volume may indicate a lack of bona fide market interest in the
security at the posted bid price); (iii) the market maker montage (the number of
market makers quoting at or above $1.00 and the size of their quotes); and, (iv)
the trend of the stock price (is it up or down).
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
CATUITY INC.
(Registrant)
By /s/ John H. Lowry
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John H. Lowry
Senior Vice President,
Chief Financial Officer & Secretary
Date: May 11, 2004
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