Zila, Inc. (Zila) has received a staff deficiency letter from NASDAQ on March 23, 2009. The letter states that the company fails to meet The NASDAQ Global Market Marketplace minimum stockholders' equity continued listing requirement of $10 million. The stockholders’ equity of the company for the period ended January 31, 2009 is less than $10 million. As per the NASDAQ rules, Zila was given until April 7, 2009 to submit a plan to regain compliance with NASDAQ’S standards for continued listing.

If the company submits a plan and it is accepted by the Listing Qualifications Department, Zila may be granted an exception of up to 105 calendar days from the date of the deficiency letter (i.e., until July 6, 2009) to evidence compliance. If the plan is not accepted, the company will have seven calendar days from the date of such determination to request an appeal hearing before a Listing Qualifications Panel.

Zila’s common stock will continue to be traded on The NASDAQ Global Market while its plan is under review by Nasdaq and pending the resolution of any such appeal process. Alternatively, Zila may apply to transfer its securities to The NASDAQ Capital Market. The NASDAQ Capital Market, formerly the NASDAQ SmallCap Market, is a continuous trading market that operates in the same manner as The NASDAQ Global Market. All companies, whose securities are listed on The NASDAQ Capital Market must meet certain financial requirements and adhere to NASDAQ’s corporate governance standards.

Zila is a US-based dental devices company.