Lifecore Biomedical, Inc. Announces Receipt of Nasdaq Notice of Delisting and Intention to Appeal
Lifecore Biomedical, Inc. (NASDAQ: LFCR) faces potential delisting from Nasdaq due to non-compliance with filing financial reports. The company received a Staff Delisting Determination but has the opportunity to appeal and seek a stay of any delisting action. Lifecore Biomedical is working to complete the restatement of its financial statements and file the overdue reports to regain compliance with Nasdaq's Listing Rule.
Negative
Lifecore Biomedical, Inc. is facing potential delisting from Nasdaq due to non-compliance with filing financial reports, which could impact investor confidence and the company's stock performance.
The delay in filing the required financial reports may lead to uncertainties regarding the company's financial health and compliance with regulatory standards, potentially affecting its market reputation.
There is no guarantee that Lifecore Biomedical, Inc. will be able to file the delinquent periodic reports before any hearing occurs or that the Nasdaq Hearing Panel will grant the company's request for a stay pending the hearing process, raising concerns about the company's future listing status.
When a company receives a Staff Delisting Determination from Nasdaq, it signals a significant concern regarding the company's ability to meet exchange listing requirements. In this case, Lifecore Biomedical's failure to file required periodic financial reports represents a breach of Nasdaq's Listing Rule 5250(c)(1). This development can trigger investor uncertainty, potentially impacting the stock's liquidity and investor confidence. The company's intent to appeal and the ongoing restatement efforts indicate a proactive approach to resolving the compliance issue. However, the lack of financial transparency could lead to volatility in the stock price as investors reassess the risk associated with the company's governance and financial health.
Historically, companies that fail to meet listing requirements may face reduced access to capital markets and increased borrowing costs. If Lifecore Biomedical is unable to file the delinquent reports in a timely manner, or if the Nasdaq Hearing Panel does not grant a stay, the company could be delisted, which often results in a shift to over-the-counter markets, where stocks typically trade with less liquidity and at lower valuations. Investors should closely monitor the company's progress towards regaining compliance and the outcome of the appeal process.
The legal implications of a Staff Delisting Determination are significant for Lifecore Biomedical. The company's ability to appeal the decision before a Nasdaq Hearing Panel is a critical right afforded to listed entities facing delisting. The outcome of such hearings can have material effects on the company's legal standing and investor relations. The hearing process itself, including the request for a stay of suspension, is a legal strategy to maintain the company's listed status while it attempts to rectify the compliance issues.
It is important to note that the restatement of financials is a complex legal issue that often suggests potential inaccuracies or misstatements in previous reports. This can lead to increased scrutiny by the SEC and possibly result in legal consequences beyond the scope of Nasdaq's listing rules. The company's ability to successfully navigate the restatement process and the legal challenges associated with the appeal will be pivotal in determining its future on the stock exchange.
The notice of potential delisting for Lifecore Biomedical can have a profound effect on the market's perception of the company. Delisting often leads to a reevaluation of the company's market value, affecting not only the stock price but also its reputation among investors and partners. The delay in filing financial reports may cause concern among stakeholders about the reliability of the company's financial disclosures and its internal control over financial reporting.
Market trends indicate that companies undergoing financial restatements and facing delisting risk typically experience a decline in market capitalization, which can be detrimental in both the short and long term. The market will be closely observing the company's ability to address the filing delays and the outcomes of the restatement process. If Lifecore Biomedical manages to regain compliance and maintain its listing, it could potentially restore investor confidence and stabilize its market position. Conversely, continued non-compliance could exacerbate market skepticism and lead to further erosion of shareholder value.
02/16/2024 - 04:05 PM
Notice of Delisting Will Not Immediately Result in the Suspension or Delisting of the Company’s Securities
CHASKA, Minn., Feb. 16, 2024 (GLOBE NEWSWIRE) -- Lifecore Biomedical, Inc. (NASDAQ: LFCR) (the “Company”) announced today that on February 13, 2024 it received a Staff Delisting Determination (the “Staff Determination”) from the Listing Qualifications Department of The Nasdaq Stock Market LLC (“Nasdaq”) notifying the Company that Nasdaq has initiated which could result in the delisting of the Company’s securities from Nasdaq as a result of the Company not being in compliance with Nasdaq Listing Rule 5250(c)(1) (the “Listing Rule”), which requires listed companies to timely file all required periodic financial reports with the Securities and Exchange Commission (the “SEC”). The Staff Determination has no immediate effect and will not immediately result in the suspension of trading or delisting of the Company’s securities.
The Staff Determination was issued because the Company has not filed its Annual Report on Form 10-K for the fiscal year ended May 28, 2023 (the “Form 10-K”) or its Quarterly Reports on Form 10-Q for the quarterly periods ended August 27, 2023 (the “First Quarter Form 10-Q”) and November 29, 2023 (the “Second Quarter Form 10-Q”) by the Extension Deadline (defined below).
The Company intends to appeal the Staff Determination before a Nasdaq Hearing Panel and seek a further stay of any suspension or delisting action pending the hearing process in accordance with the procedures set forth in the Staff Determination Letter. The Company is working diligently with its auditors to complete the previously disclosed restatement for the Company’s previously issued consolidated financial statements as of and for the fiscal years ended May 29, 2022 and May 30, 2021 included in the Company’s Annual Report on Form 10-K/A filed with the SEC, the Company’s unaudited consolidated financial statements as of and for the periods ending August 30, 2020, November 29, 2020, February 28, 2021, August 29, 2021, November 28, 2021, February 27, 2022, August 28, 2022, November 27, 2022 and February 26, 2023 included in the Company’s Quarterly Reports on Form 10-Q filed with the SEC, and to file the Form 10-K, First Quarter 10-Q and Second Quarter 10-Q.
As previously disclosed, Nasdaq had granted the Company a period of 180 calendar days from the prescribed due date of the Form 10-K, or until February 12, 2024 (the “Extension Deadline”), to file the Form 10-K, First Quarter Form 10-Q, and Second Quarter Form 10-Q to regain compliance with the Listing Rule. The Company previously disclosed the delay in and circumstances behind the late filing of each of the Form 10-K, the First Quarter Form 10-Q, and Second Quarter Form 10-Q in a Notification of Late Filing on Form 12b-25, filed with the SEC on August 14, 2023, October 10, 2023, and January 10, 2024, respectively.
The Company’s request for a hearing before the Nasdaq Hearing Panel to appeal the Staff Determination must be made no later than 4:00 p.m. Eastern Time on February 20, 2024. The hearing request will automatically stay the suspension of the Company’s securities for a period of 15 days from the date of the request. In connection with its request for a hearing, the Company also intends to request that the Staff Determination be further stayed pending the hearing process. According to the Staff Determination, hearings are typically scheduled to occur approximately 30-45 days after the date of a company’s hearing request. Following the hearing, the Hearings Panel will issue a decision, which the Company may further appeal to the Nasdaq Listing Council for review. The Company is working diligently to file the delinquent periodic reports as soon as possible to regain compliance with the Listing Rule. However, there can be no assurance that such periodic reports will be filed before any hearing occurs or that the Nasdaq Hearing Panel will grant the Company’s request for a stay pending the hearing process.
About Lifecore Biomedical www.lifecore.com .
Forward-Looking Statements
Because such statements are based on the Company’s current expectations and are not statements of fact, actual results may differ materially from those projected or estimated and you are cautioned not to place undue reliance on these forward-looking statements. All forward-looking statements involve certain risks and uncertainties that could cause actual results to differ materially, including such factors among others, the Company’s ability to respond in a timely and satisfactory matter to the inquiries by Nasdaq, the Company’s ability to regain compliance with Listing Rule, the Company’s ability to become current with its reports with the SEC, the risk that the completion and filing of the delinquent periodic reports will take longer than expected, and the risk that Nasdaq does not grant the Company’s request for a stay pending the hearing process or does not grant the Company’s request for continued listing. For additional information about factors that could cause actual results to differ materially from those described in the forward-looking statements, please refer to our filings with the Securities and Exchange Commission, including the risk factors contained in our most recent Quarterly Report on Form 10-Q and Annual Report on Form 10-K/A. Forward-looking statements represent management’s current expectations and are inherently uncertain. Except as required by law, we do not undertake any obligation to update forward-looking statements made by us to reflect subsequent events or circumstances.
Lifecore Biomedical, Inc. Contact Information:
Why is Lifecore Biomedical, Inc. (LFCR) facing potential delisting from Nasdaq?
Lifecore Biomedical, Inc. is facing potential delisting from Nasdaq due to non-compliance with filing financial reports, specifically the Annual Report on Form 10-K and Quarterly Reports on Form 10-Q.
What action is Lifecore Biomedical, Inc. taking in response to the Staff Delisting Determination?
Lifecore Biomedical, Inc. intends to appeal the Staff Determination before a Nasdaq Hearing Panel and seek a further stay of any suspension or delisting action pending the hearing process.
What is the deadline for Lifecore Biomedical, Inc. to request a hearing before the Nasdaq Hearing Panel?
The deadline for Lifecore Biomedical, Inc. to request a hearing before the Nasdaq Hearing Panel is no later than 4:00 p.m. Eastern Time on February 20, 2024.
What is the potential outcome of Lifecore Biomedical, Inc.'s appeal to the Nasdaq Hearing Panel?
The Nasdaq Hearing Panel will issue a decision following the hearing, which Lifecore Biomedical, Inc. may further appeal to the Nasdaq Listing Council for review.
What is Lifecore Biomedical, Inc. doing to regain compliance with Nasdaq's Listing Rule?
Lifecore Biomedical, Inc. is working diligently to complete the restatement of its financial statements and file the delinquent periodic reports as soon as possible to regain compliance with Nasdaq's Listing Rule.
