Stanley Furniture Co. Inc. said it received a noncompliance Nasdaq notice for falling below the minimum bid price requirement of $1 per share for more than 30 consecutive days, according to an SEC filing Dec. 28.
The American furniture manufacturer said the notice will not have an immediate effect on its listing or trading on the Nasdaq Global Select Market. The retailer has a grace period until June 19, 2018, to comply with the minimum closing bid requirement.
The closing bid price of the company's shares must be at least $1 per share for 10 consecutive business days or more during the 180 days grace period. If the company fails to comply with the minimum requirement during the grace period, it can qualify for an additional 180 days grace period, provided it decides to transfer the listing of its stocks to the Nasdaq Capital Market. The company is subject to delisting if it fails to comply during the second grace period.
Stanley Furniture previously disclosed that it entered into an asset purchase agreement on Nov. 20 to sell all of its assets to Churchill Downs LLC. The deal is subject to several closing conditions, including approval by the company's stockholders. If the deal is approved, Stanley Furniture said it would no longer have an operational business immediately following the close, which could put at risk of being in noncompliance with Nasdaq again.
"While the company will consider appealing such a determination, if unsuccessful in doing so the company's common stock will be delisted from Nasdaq," according to its filing.
Stanley Furniture also notified Nasdaq that its audit committee fell short of the required three members following the resignation of two directors, Michael Haley and Justin Putnam on Dec. 11, according to the filing. The company subsequently received a noncompliance notice from Nasdaq on Dec. 27.
The company is entitled to a cure period to comply with this requirement for continued listing. The period will expire at Stanley Furniture's next annual stockholder meeting if it is held before June 11, or the expiration date will be Dec. 11, 2018. If the retailer fails to re-establish the compliance during this period, the company is subject to delisting by Nasdaq.