Locafy Regains Compliance with Nasdaq Stockholders’ Equity Requirement
Locafy Limited (Nasdaq: LCFY, LCFYW) regained compliance with Nasdaq Listing Rule 5550(b)(1) for the minimum stockholders' equity requirement of $2,500,000 on October 31, 2023. The company will be subject to a mandatory panel monitor for one year from that date. Locafy had previously received a Notice from Nasdaq on March 31, 2022, regarding non-compliance with the Stockholders' Equity Requirement, but was granted an exception by the Panel in August 2023, subject to certain conditions. The company filed an Annual Report on Form 20-F for the year ended June 30, 2023, by October 31, 2023, demonstrating compliance with the Stockholders' Equity Requirement.
The announcement from Locafy Limited regarding its regained compliance with Nasdaq's Stockholders’ Equity Requirement represents a significant turnaround in the company’s financial health. This compliance is an indicator of improved financial stability and can be a positive signal to investors about the company's ability to meet exchange listing standards, which often translates into a more favorable perception of the company's stock. The mandatory panel monitor, however, suggests ongoing scrutiny, which can be seen as a measure to ensure continued adherence to financial standards.
It's important to note that the Stockholders’ Equity Requirement is a measure of a company's intrinsic value from an accounting perspective. It reflects the difference between a company's total assets and total liabilities and meeting this requirement indicates that the company has a sufficient cushion to absorb potential losses. In the short-term, this news can lead to increased investor confidence and potentially a positive impact on the stock price. In the long-term, sustained compliance can improve the company's reputation and financial flexibility.
From a legal standpoint, the receipt of the Notice from Nasdaq is a procedural outcome that indicates Locafy Limited has fulfilled its obligations under the Nasdaq Listing Rule 5550(b)(1). The prior non-compliance could have led to delisting, a scenario fraught with legal complexities and negative implications for market trust. By filing the required Annual Report on Form 20-F ahead of the deadline, Locafy demonstrated its commitment to transparency and regulatory adherence, which is essential for maintaining corporate governance standards.
The one-year panel monitoring imposed by Nasdaq is a standard oversight procedure designed to ensure that the company does not fall back into non-compliance. This oversight can be seen as both a safeguard for investors and a potential source of pressure for the company to maintain strict financial discipline. The legal implications of failing to comply during this monitoring period could be severe, including delisting, which would severely impact the company's ability to raise capital and maintain shareholder value.
Regaining compliance with Nasdaq's Stockholders’ Equity Requirement is a critical milestone for Locafy Limited, particularly in the context of the tech industry where investor confidence is paramount. Achieving this compliance could be indicative of the company's operational improvements or successful capital raising efforts. For industry peers and competitors, this development may signal an increased competitive landscape where financial stability becomes a differentiator.
Furthermore, the mandatory panel monitor, while a sign of past issues, can also be perceived as an opportunity for Locafy to demonstrate operational excellence and financial acumen. In the tech industry, where innovation and growth are often prioritized over immediate profitability, maintaining strong financial fundamentals is crucial for long-term success. This event can prompt industry stakeholders to reassess their financial strategies to ensure they are aligned with listing requirements and investor expectations.
12/20/2023 - 08:00 AM
PERTH, Australia, Dec. 20, 2023 (GLOBE NEWSWIRE) -- Locafy Limited (Nasdaq: LCFY, LCFYW) (“Locafy” or the “Company”) , received a notice (the “Notice”) on December 18, 2023, from the Nasdaq Office of General Counsel of the Nasdaq Stock Market LLC (“Nasdaq”), that the Nasdaq Hearings Panel (the “Panel”) has determined that the Company had regained compliance with Nasdaq Listing Rule 5550(b)(1) as related to the minimum stockholders’ equity requirement of $2,500,000 (the “Stockholders’ Equity Requirement”) for continued listing on Nasdaq on October 31, 2023. Additionally, pursuant to the Notice and Nasdaq Listing Rule 5818(d)(4)(B), the Company will be subject to a mandatory panel monitor for a period of one year from October 31, 2023.
As previously reported, on March 31, 2022, the Company received a Notice from Nasdaq informing it that it was not in compliance with the Stockholders’ Equity Requirement, and in August 2023, the Company was granted an exception to the Stockholders’ Equity Requirement by the Panel, subject to certain conditions, including that the Company file an Annual Report on Form 20-F for the year ended June 30, 2023, by October 31, 2023, demonstrating compliance with the Stockholders’ Equity Requirement, which such Annual Report was filed on October 11, 2023.
For more information, please visit the Company’s investor relations website at investor.locafy.com
About Locafy $700 billion SEO sector. We help businesses and brands increase search engine relevance and prominence in a specific proximity using a fast, easy, and automated approach. For more information, please visit www.locafy.com
Forward-Looking Statements This press release contains “forward-looking statements” that are subject to substantial risks and uncertainties. All statements, other than statements of historical fact, contained in this press release are forward-looking statements. Forward-looking statements contained in this press release may be identified by the use of words such as “subject to”, “believe,” “anticipate,” “plan,” “expect,” “intend,” “estimate,” “project,” “may,” “will,” “should,” “would,” “could,” “can,” the negatives thereof, variations thereon and similar expressions, or by discussions of strategy, although not all forward-looking statements contain these words. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, they do involve assumptions, risks, and uncertainties, and these expectations may prove to be incorrect. You should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. The Company’s actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including those discussed in the Company’s periodic reports that are filed with the Securities and Exchange Commission and available on its website ( http://www.sec.gov ). All forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these factors. Other than as required under the securities laws, the Company does not assume a duty to update these forward-looking statements.
Investor Relations Contact LCFY@gateway-grp.com
What is the ticker symbol for Locafy Limited?
The ticker symbols for Locafy Limited are LCFY and LCFYW.
What was the minimum stockholders' equity requirement for Nasdaq compliance?
The minimum stockholders' equity requirement for Nasdaq compliance was $2,500,000.
When did Locafy regain compliance with Nasdaq Listing Rule 5550(b)(1)?
Locafy regained compliance with Nasdaq Listing Rule 5550(b)(1) on October 31, 2023.
What conditions were imposed on Locafy after being granted an exception by the Panel?
After being granted an exception by the Panel, Locafy was subject to certain conditions, including filing an Annual Report on Form 20-F for the year ended June 30, 2023, by October 31, 2023, demonstrating compliance with the Stockholders' Equity Requirement.
What action will Nasdaq take in response to Locafy's compliance with the Stockholders' Equity Requirement?
Nasdaq will subject Locafy to a mandatory panel monitor for a period of one year from October 31, 2023, in response to the company's compliance with the Stockholders' Equity Requirement.
