Two Reverse Splits Take Effect Monday at Companies That Can No Longer Buy a Nasdaq Cure Period

by Renée Delacroix · August 14, 2026

Senior Analyst, The MicroCap Herald

Two Nasdaq-listed micro-caps open Monday, August 17, with far fewer shares outstanding than they carry into Friday. AiRWA Inc. (Nasdaq: YYAI) said Thursday that a 1-for-20 reverse stock split takes effect at that day's open, cutting shares outstanding from approximately 91,627,558 pre-split to approximately 4,581,378 post-split. Profusa, Inc. (Nasdaq: PFSA), on the Nasdaq Capital Market, said the same day that a 1-for-4 split becomes effective at 12:01 a.m. Eastern Monday, taking 2,422,906 pre-split shares to roughly 605,726 post-split. Neither has happened yet. Both closed Thursday below a dollar — YYAI at $0.0639, PFSA at $0.95, per Investing.com's quote pages — and both have effected reverse splits within the past year, which changes what Monday can accomplish.

The provision is Nasdaq Listing Rule 5810(c)(3)(A), as amended by a rule change the SEC approved by order dated January 17, 2025. Nasdaq's filing sets out the language: where a company's security fails the continued listing requirement for minimum bid price and the company has effected a reverse stock split over the prior one-year period, or one or more reverse splits over the prior two-year period with a cumulative ratio of 250 shares or more to one, it is not eligible for any compliance period and the Listing Qualifications Department is directed to issue a Staff Delisting Determination. The one-year leg was added in 2025; the 250-to-1 leg already existed.

That inverts the usual framework. As the law firm K&L Gates summarised when the amendments were adopted, a security closing under $1.00 for 30 consecutive business days ordinarily gets 180 days to regain compliance, cures by closing at $1.00 or better for at least 10 consecutive business days, and if it misses can be granted a further 180 days by telling Nasdaq it intends to cure — typically through a reverse split. The bar reaches the bid price deficiency specifically and bites only once the security fails that test; until then it is prospective, but not discretionary.

Monday will be AiRWA's third split disclosed since last autumn. On October 23, 2025 it announced a 1-for-50 consolidation effective at the October 27 open, taking approximately 949,066,180 pre-split shares to approximately 18,981,324 post-split; that release, filed with the SEC as an exhibit, said the chief executive opted for the ratio with the aim of meeting Nasdaq's $1.00 minimum bid price requirement. On May 14, 2026 it announced a 1-for-40 split effective at the May 18 open, cutting approximately 42,142,432 pre-split shares to approximately 1,053,561 post-split. The three ratios multiply to 40,000-to-1 across roughly ten months — 160 times the 250-to-1 threshold — all inside the two-year lookback.

Thursday's release traces the authorisation to the April 17, 2026 annual meeting, where stockholders approved one or more reverse splits over two years within a range of 1-for-40 to 1-for-800; May's 1-for-40 and Monday's 1-for-20 multiply to that range's top. The ticker stays YYAI and the CUSIP changes to 831445705, from the 831445606 assigned in May. No fractional shares will be issued — holders receive a rounded-up whole share — and warrant and equity-award exercise prices adjust proportionately.

The arithmetic between AiRWA's last two splits is the part worth sitting with. It left the May 18 consolidation with about 1,053,561 shares outstanding; Thursday's release puts the pre-split count at 91,627,558, an 87-fold increase in the 87 days since. Applying Monday's ratio to Thursday's $0.0639 close implies a post-split reference near $1.28 — above the line, with little margin. Should the post-split price then close below $1.00 for 30 consecutive business days, the bar directs staff to a delisting determination rather than a 180-day letter.

AiRWA also carries a near-term cash obligation. It said on July 30 that it had completed the acquisition of Hong Kong Best Life Trade Co., Limited — a 97% equity interest — paying $30 million in USDT at closing, with the remaining $20 million of the $50 million base price payable within 90 days of closing plus earn-outs tied to previously disclosed revenue milestones. Against that $20 million, the 91,627,558 pre-split shares carried a market value of roughly $5.9 million at Thursday's close. The announcement did not identify the source of funds for the balance.

Profusa's sequence is more compressed. A 1-for-75 split took effect at 12:01 a.m. Eastern on February 9, 2026, cutting approximately 92.4 million pre-split shares to approximately 1.2 million post-split, per its Form 8-K. A 1-for-25 split followed at 12:01 a.m. Eastern on July 7, cutting roughly 13.2 million pre-split shares to about 530,000 post-split. Monday's 1-for-4 is the third in a little over six months; the ratios compound to 7,500-to-1, all inside the two-year lookback. The count refilled each time — about 530,000 immediately after July 7, then 2,422,906 by Thursday, a 4.6-fold re-expansion in five weeks. The new CUSIP is 74319X405. Profusa pays cash in lieu of fractional shares rather than rounding up, which can extinguish the smallest positions.

Its listing file is long and its balance sheet is thin. Per Investing.com's reporting on the filings, Nasdaq notified the company on September 11, 2025 that it failed the Global Market's $50 million market value of listed securities standard under Rule 5450(b)(2)(A) and the $1.00 bid price requirement, giving it until March 10, 2026; a further notice cited the $15 million market value of publicly held shares test under Rule 5450(b)(1)(C). When that deadline passed, staff determined the stock would be delisted at the opening of business on March 20, 2026 absent a hearing request. Profusa requested a hearing and said on May 8 that a Hearings Panel had granted an exception and approved its transfer to the Capital Market, conditioned on meeting the bid price and stockholders' equity requirements by July 6, 2026. That date has passed; the company has not announced regaining bid price compliance.

The quarterly report for the period ended March 31, 2026 showed cash and cash equivalents of $375 thousand and an accumulated deficit of $164.2 million against a net loss of $3.5 million for the three months. The filing states that as of March 31, 2026 there continue to be factors which raise substantial doubt about the company's ability to continue as a going concern within one year from the date the condensed consolidated financial statements are issued.

The mechanism refilling the share count sits in the financing documents. A prospectus dated May 18 registered 179,272,293 resale shares — a figure struck before both the July 1-for-25 and Monday's 1-for-4 splits — of which up to 150,568,827 sat under a $100 million equity purchase agreement with Ascent Partners Fund LLC. Shares under that facility are priced at 97% of the lowest volume-weighted average price over the ten trading days preceding an advance notice, with a true-up issuing more shares if the adjusted price falls below the reference closing price, and a per-advance cap of 9.99% of outstanding shares or $300,000. Instruments priced off a floating discount issue more shares as the price falls — the dynamic that unwinds a reverse split.

Nothing about Monday changes either company's economics. A reverse split adds no cash, retires no debt and does not alter the $20 million AiRWA still owes on Best Life. Nor does it help elsewhere: Nasdaq's Continued Listing Guide also requires 500,000 publicly held shares on the Capital Market, and Rule 5005(a)(35) excludes shares held by officers, directors and beneficial owners of more than 10 percent — so Profusa's roughly 605,726 post-split shares outstanding overstate that cushion. What a split changes is the quoted price and the regulatory clock, and the clock is the problem. A delisting determination can be appealed to a Hearings Panel, and a timely request generally stays suspension. Both stocks carry plain delisting risk; Profusa additionally carries an explicit going-concern qualification, minimal cash against its quarterly losses, and financing that issues more shares as the price falls.