Compliance $1 per share

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

On March 23, 2016, the Nasdaq Stock Market (“Nasdaq”) notified Sunshine Heart, Inc. (the “Company”) that it no longer complies with Rule 5550(a)(2) (the “Minimum Bid Price Rule”), as the bid price of the Company’s shares of common stock (“Common Stock”) closed below the minimum $1.00 per share for the 30 consecutive business days prior to the date of the notice. In accordance with Rule 5810(c)(3)(A), the Company will be provided 180 calendar days, or until September 19, 2016, to regain compliance with the Minimum Bid Price Rule. The Company may regain compliance with the Minimum Bid Price Rule if the closing bid price of the Common Stock is $1.00 per share or more for a minimum of 10 consecutive business days at any time before September 19, 2016.

The Nasdaq letter further states that if compliance with the Minimum Bid Price Rule cannot be demonstrated by September 19, 2016, the Company may be eligible for a second 180 day period to regain compliance. To be eligible for the second 180 day compliance period, (i) the Company must meet the market value of publicly held shares requirement for continued listing and all other applicable standards for initial listing on The Nasdaq Capital Market set forth in Marketplace Rule 5505 (except the bid price requirement), (ii) the Company must provide Nasdaq with written notice of its intention to cure the deficiency, through a reverse stock split, if necessary, and (iii) Nasdaq must determine that the Company will be able to cure the deficiency.

Clearly the company cannot achieve 10 days above $1 by 19 September so will receive a second notice. I personally am not concerned the company will not achieve a share price above $1 within the second 180 day period leading to a share split. The only way it will not be able to achieve this is if the acute trial in December is unsuccessful. That would be my concern and why the threat of a stock split is largely irrelevant. I do have high hopes the December acute trial will be a success.