ITEM 3.01 NOTICE OF DELISTING OR FAILURE TO SATISFY A CONTINUED LISTING RULE OR
STANDARD; TRANSFER OF LISTING.
On July 20, 2020, Stein Mart, Inc. (the "Company") received a letter from the
Listing Qualifications staff of The Nasdaq Stock Market ("Nasdaq") notifying the
Company that it is no longer in compliance with the minimum stockholders' equity
requirement for continued listing on the Nasdaq Capital Market. Nasdaq Listing
Rule 5550(b)(1) requires listed companies to maintain stockholders' equity of at
least $2,500,000. Further, as of July 17, 2020, the Company did not meet the
alternative compliance standards relating to the market value of listed
securities or net income from continuing operations.
The notification letter has no immediate effect on the Company's listing on the
Nasdaq Capital Market. Nasdaq has provided the Company with 45 calendar days, or
until September 3, 2020, to submit a plan to regain compliance with the minimum
stockholders' equity standard. If the Company submits a plan to regain
compliance that is accepted, Nasdaq may grant an extension of up to 180 calendar
days from the date of the notification letter to regain compliance. If the
Company does not submit a plan to regain compliance or if such plan is not
accepted, or if it is accepted and the Company does not regain compliance in the
timeframe required by Nasdaq, the Nasdaq staff could provide notice that the
Company's common stock is subject to delisting.
As previously reported, Nasdaq previously notified the Company that it did not
meet the $1.00 minimum bid price for the last 30 consecutive business days as
required by Rule 5450(a)(1) (the "Minimum Bid Price Requirement") and the
Company has until September 18, 2020 to regain compliance with the Minimum Bid
Price Requirement.
The Company currently does not expect that it will be able to regain compliance
with the Minimum Bid Price Requirement or that it will otherwise be in
compliance with other Nasdaq listing criteria prior to the deadlines above. The
delisting of the Company's common stock from The Nasdaq Capital Market could
adversely affect the market liquidity of the Company's common stock and could
result in other negative implications, including the potential loss of
confidence by suppliers, customers and employees, and fewer business development
opportunities. Any such developments could impair the value of your investment.
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