8-K: Noodles & Company Faces Nasdaq Delisting Threat

Noodles & Company received a delisting determination from Nasdaq after failing to meet the minimum bid price requirement, but plans to appeal and propose a reverse stock split.

Summary

• Noodles & Company (NDLS) received a delisting determination letter from Nasdaq on December 23, 2025.
• This follows the company's failure to regain compliance with Nasdaq Listing Rule 5450(a)(1), which requires a minimum closing bid price of $1.00 per share.
• The company was initially notified on June 24, 2025, and had 180 calendar days, until December 22, 2025, to regain compliance.
• Noodles & Company was not eligible for an extension to transfer to The Nasdaq Capital Market.
• The company intends to request a hearing before a Nasdaq Hearings Panel by December 30, 2025, which will automatically stay any suspension or delisting action.
• As part of its plan to regain compliance, the company will propose a reverse stock split at a special stockholder meeting on February 4, 2026, with a ratio ranging from one-for-two (1:2) to one-for-fifteen (1:15).

Sentiment

Score: 2

Explanation: The filing indicates a significant negative event with the delisting determination, reflecting severe non-compliance with listing standards and potential adverse impacts on the company's stock and operations. While the company is taking steps to appeal, the underlying issue is critical.

Positives

• The company is taking proactive steps by intending to request a hearing before the Nasdaq Hearings Panel by December 30, 2025, which will temporarily stay delisting.
• Management is preparing a plan to regain compliance, including proposing a reverse stock split to stockholders.

Negatives

• Noodles & Company failed to maintain the minimum closing bid price of $1.00 per share, leading to a delisting determination from Nasdaq.
• The company was not eligible for an additional 180-day extension to regain compliance.
• Potential delisting could make it more difficult to buy or sell common stock, lead to a material decline in share price, impair the ability to raise capital, and trigger defaults under existing agreements.

Risks

• No assurance that the company will be able to regain compliance with the Minimum Bid Price Requirement or other Nasdaq listing rules.
• Uncertainty regarding the successful implementation of a reverse stock split, even if approved.
• Potential delisting of common stock from Nasdaq Global Select Market.
• If delisted, increased difficulty in trading the common stock and obtaining accurate quotations.
• Risk of a material decline in the price of the common stock if delisted.
• Impairment of the company's ability to raise capital.
• Potential for defaults and penalties under outstanding agreements or securities of the company.

Future Outlook

The company plans to appeal the delisting determination and present a plan to regain compliance, which may include a reverse stock split. There is no assurance that the company will successfully regain compliance or implement the reverse stock split.

Management Comments

• The Company intends to request a hearing before the Panel on or before December 30, 2025.
• In connection with the hearing before the Panel, the Company will provide Nasdaq with its plan to regain compliance with the Minimum Bid Price Requirement, including, subject to approval of the Company’s Board of Directors and its stockholders, implementing a reverse stock split, should it be necessary.

Industry Context

This event is specific to Noodles & Company's compliance with Nasdaq listing rules and does not directly reflect broader industry trends, although maintaining listing standards is a common challenge for smaller or underperforming public companies across various sectors.

Corporate Governance

Stakeholder Impact

• Shareholders: Potential for significant share price decline, reduced liquidity, and increased difficulty in trading if delisted. The proposed reverse stock split could also impact per-share value and perception.
• Creditors/Lenders: Delisting could trigger defaults and penalties under existing agreements, potentially increasing the cost of capital or leading to accelerated repayment demands.
• Employees: While not directly mentioned, significant corporate instability can impact employee morale and retention.

Next Steps

• Request a hearing before the Nasdaq Hearings Panel by December 30, 2025.
• Prepare and present a plan to regain compliance to Nasdaq.
• Hold a special meeting of stockholders on February 4, 2026, to vote on a reverse stock split.
• If approved, potentially effect a reverse stock split within one year after the special meeting.

Key Dates

Recommendation

The delisting determination from Nasdaq represents a severe negative event, indicating fundamental issues with the company's stock performance and potentially its underlying business. While the company plans to appeal and propose a reverse stock split, there is no guarantee of regaining compliance. The risks of delisting, including reduced liquidity, further price decline, and impaired capital-raising ability, are substantial and immediate. Investors should consider exiting their positions to avoid further potential losses given the high uncertainty and significant downside risk.

Keywords

Noodles & Company, NDLS, Nasdaq, Delisting, Minimum Bid Price, Reverse Stock Split, Corporate Governance, SEC Filing, Stock Market, Compliance