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NASDAQ Issues Non-Compliance Warnings

18 August 2008 - News - Editor

During the past week a number of companies received notifications from NASDAQ’s Listing Qualifications division relating to various aspects of non-compliance with regard to minimum stock exchange listing requirements. Failure to fall back into line with listing requirements would result in the company being de-listed from the NASDAQ stock exchange.

Wave Systems Corp (NASDAQ: WAVX); Nucryst Pharmaceuticals (NASDAQ: NCST; TSX: NCS); Taitron Components Inc. (NASDAQ: TAIT); Avanir Pharmaceuticals (NASDAQ: AVNR); Newtek Business Services (NASDAQ: NEWT); and I-Many, Inc. (NASDAQ: IMNY) all received notification of non-compliance with NASDAQ’s Marketplace “Bid Price Rule” (Rule 4450(a)(5)). Each of these companies had experienced a period of thirty consecutive days during which their common stock closed below the $1.00 minimum share price stipulated by NASDAQ as a requirement to remain listed on the NASDAQ stock exchange.

Having received notification of the possibility of being de-listed, in accordance with NASDAQ Marketplace Rule 4450(e)(2), companies have a period of 180 calendar days from such notification to regain compliance with the Bid Price Rule. If at any time during this period, for a period of ten days or more, the bid price for common stock closes at $1.00 or more, the company will be deemed to be in compliance with the Bid Price Rule. If a company decides to go the route of transferring their securities from the NASDAQ Global Market to the NASDAQ Capital Market, and their application is successful, it will be given up to 180 additional days to comply with the Bid Price Rule. Once they have received a notification of delisting, companies have the option to appeal to the NASDAQ Listing Qualifications Panel against being de-listed.

For Wave Systems, this was the second time in less than a month that they had received a notification from the NASDAQ Listing Qualifications division. The first was received by the company on 17 July and indicated that, due to the market value of Wave’s common stock being below $50 million for a period of ten consecutive business days it was subject to potential delisting in line with NASDAQ’s “Market Value Rule”.

Force Protection, Inc. (NASDAQ: FRPT) has been notified by NASDAQ that by neglecting to file its Form 10-Q for the quarter ended 30 June 2008, it has failed to comply with the NASDAQ Marketplace Rule 4310(c)(14), and therefore can be de-listed from the stock exchange. This follows the company’s failure to file year end results for 2007 and first quarter results for 2008. Force Protection has been granted a “stay of execution” until 15 September 2008 under certain conditions which includes that, on or before this date, it will file the outstanding results reports.

 


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