ALJJ ALJ Regional Holdings Inc

Item 3.01 Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing.

On August 22, 2022, ALJ Regional Holdings, Inc. (“we,” “our” or the “Company”) submitted a formal notice to The Nasdaq Stock Market LLC (“NASDAQ”) of our decision to voluntarily delist our common stock, par value $0.01 per share (the “Common Stock”), from the NASDAQ Global Market and our intent to file a Form 25 with the U.S. Securities and Exchange Commission (the “SEC”) on or about September 1, 2022. As a result, we expect the last day of trading of our Common Stock on the NASDAQ Global Market to be on or about September 11, 2022. After the delisting, we anticipate our Common Stock will be quoted on the Pink Sheets platform, which is operated by OTC Markets Group Inc. (the “Pink Sheets”), and currently we intend to continue to provide information to our stockholders and to take such actions within our control to enable our Common Stock to be quoted in the Pink Sheets so that a trading market may continue to exist for the Company’s shares. There is no guarantee, however, that a broker will continue to make a market in the Common Stock and that trading of the Common Stock will continue on the Pink Sheets or otherwise or that we will continue to provide information sufficient to enable brokers to provide quotes for our Common Stock.

After the Form 25 is effective, we also intend to pursue such other measures necessary to terminate or suspend the registration of our Common Stock under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). We expect the deregistration of our Common Stock to become effective 90 days after the date of filing the Form 25 with the SEC. However, our reporting obligations to file certain reports with the SEC, including Forms 10-Q, 10-K and 8-K, will be immediately suspended upon filing the Form 25. Other filing requirements will terminate upon effectiveness of the deregistration. We are eligible to voluntarily deregister because we have fewer than 300 stockholders of record.

The Board believes that the decision to delist the shares from NASDAQ and deregister the Common Stock under Section 12(b) of the Exchange Act is in the best interest of the Company and its stockholders as it has determined that the burdens associated with operating as a registered public company outweigh any advantages to the Company and our stockholders at this time. The Board’s decision was based on careful review of numerous factors, including the significant cost savings of no longer preparing and filing periodic reports with the SEC and reduction of significant legal, audit and other costs associated with being a reporting company, including the substantial costs and demands on management’s time relating to the requirements of the Sarbanes-Oxley Act of 2002, SEC rules and NASDAQ listing standards, as well as the fact that the Company currently intends to provide liquidity to its stockholders following the delisting by taking actions within its control to have the Common Stock traded on the Pink Sheets and making periodic repurchases of the Common Stock from our stockholders. Once delisted and deregistered, the Board believes that the Company may redirect its financial and management resources that have been used to operate as a registered public company to pursue a wider range of business opportunities and strategic transactions.