Nasdaq Issues Noncompliance Notice to Lordstown Motors
LORDSTOWN, Ohio – Nasdaq Stock Market LLC has issued a delisting notice to Lordstown Motors Corp., citing the company has failed to maintain the exchange’s minimum bid price of $1.00 for 30 consecutive business days, Lordstown Motors announced in a regulatory filing today with the U.S. Securities and Exchange Commission.
The company said it is evaluating its options, and is considering a reverse stock split to cure the default.
The electrical vehicle manufacturer has until Oct. 16 to bring its share price into compliance, the filing said.
Shares of Lordstown Motors, which trades on Nasdaq under the ticker RIDE, has closed below $1.00 every trading day between March 7 and April 18.
At midday Thursday, RIDE shares had plummeted more than 7% and was trading at their lowest bid price ever at 49 cents. The share price closed at 53 cents per unit on Wednesday.
Should Lordstown Motors fail to regain compliance by that date, the company may be eligible for an additional grace period, the filing stated. To qualify, the company must apply to transfer the listing of the Class A common stock to The Nasdaq Capital Market and provide written notice of its intention to cure the minimum bid price deficiency during the second compliance period, according to the filing.
Failing to meet these standards could result in RIDE being delisted from Nasdaq, according to exchange rules.
Should the Company meet these requirements, the Nasdaq would be expected to grant an additional 180 calendar days to regain compliance with the minimum bid price.
“The company is currently evaluating various courses of action to regain compliance with the bid price requirement, including implementing a reverse stock split if such action is authorized by the company’s stockholders,” the filing stated.
On April 11, Lordstown Motors filed a definitive proxy statement for the company’s annual meeting of stockholders to be held on May 22, 2023 which included a proposed reverse stock split of the company’s Class A common stock.
Essentially, a reverse stock split combines several shares into one, thereby boosting the price of a single unit.
The stock split ratio would range between 1:3 and 1:15, and the amendment would also authorize the company’s board of directors to determine, at its discretion, the timing of the amendment and the specific ratio of the reverse stock split, the filing stated.
Lordstown Motors manufactures the all-electric Endurance pickup out of Foxconn Ohio’s plant in Lordstown. The company announced this week that it had resumed production of the Endurance after a two-month pause to deal with supply and quality issues and two voluntary recalls.
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