Hovnanian Enterprises Inc. received a written notification from the NYSE that the company's stock has failed to meet the exchange's minimum average closing price criteria.
According to a notification received Jan. 9, the average closing price of the homebuilder's class A common stock over the consecutive 30-trading-day period ended Jan. 7 was 98 cents, below the $1.00 minimum average closing price required by the NYSE's continued listing standard.
The company said it has a six-month period from the date of the NYSE notification to regain compliance.
In order to cure the minimum average closing price deficiency, Hovnanian will, at its March 19 annual meeting, ask its shareholders to consider the approval and adoption of a series of four alternative amendments to its certificate of incorporation to effect a reverse stock split of its class A and class B common stock. The reverse stock split ratio options include 1-for-10, 1-for-15, 1-for-20 and 1-for-25.
The company's board recommended that the shareholders vote in favor of the proposed amendments.