8-K: Primis Financial Corp. Faces Nasdaq Delisting Threat Due to Delayed 10-K Filing

Primis Financial Corp. received a notice from Nasdaq regarding non-compliance with listing rules due to a delayed Form 10-K filing and is appealing the potential delisting.

Summary

• Primis Financial Corp. received a notice from Nasdaq on April 3, 2025, indicating non-compliance with Listing Rule 5250(c)(1) due to the delayed filing of its Form 10-K for the period ending December 31, 2024.
• The company had previously disclosed the delay on Form 12b-25, filed with the SEC on April 1, 2025.
• Due to a pre-existing Panel Monitor, Primis is ineligible for an extension to regain compliance, leading to Nasdaq's decision to delist the company's securities.
• Primis has appealed this determination on April 9, 2025, requesting a hearing before the Panel and an extension of the stay of delisting.
• The appeal automatically stays any suspension of trading for 15 calendar days from the date of the Hearing Request.
• The company believes it meets the standards for an extended stay and anticipates filing the Form 10-K before the hearing to regain compliance.
• As of December 31, 2024, Primis had $3.7 billion in total assets, $2.9 billion in total loans held for investment, and $3.2 billion in total deposits.

Sentiment

Score: 3

Explanation: The sentiment is negative due to the delisting notice and delayed filing, although the company is taking steps to appeal and regain compliance. The forward-looking statements are cautious and highlight several risks.

Positives

• Primis has appealed the delisting notice and requested a hearing, which provides an opportunity to regain compliance.
• The appeal automatically stays any suspension of trading for 15 calendar days.
• The company expects to file the Form 10-K before the hearing, potentially resolving the issue quickly.
• Primis believes it meets the standards for an extended stay of the delisting.

Negatives

• Primis received a notice from Nasdaq indicating non-compliance with listing rules due to a delayed Form 10-K filing.
• The company is currently subject to a Panel Monitor, which limits its ability to request an extension to regain compliance.
• There is a risk that Nasdaq may deny the company's appeal and proceed with delisting the securities.

Risks

• A further material delay in the company's financial reporting could occur.
• The ongoing review may identify errors or control deficiencies in the company's accounting practices.
• Restatements may subject the company to unanticipated costs or regulatory penalties.
• Control deficiencies may result in material weaknesses in the company's internal control over financial reporting.
• The company may be unable to regain compliance with, or continue to comply with, Nasdaq Listing Rules.
• Nasdaq may deny the company's appeal and delist the company's securities.
• Investigations or actions by governmental authorities or regulators could occur.
• The company may become subject to shareowner lawsuits or claims.
• The company's ability to implement and maintain effective internal control over financial reporting and/or disclosure controls and procedures in the future may be limited.

Future Outlook

The company plans to file the Form 10-K as promptly as practicable and currently expects to do so prior to the hearing, at which point the company will be in compliance with the Listing Rules. The company believes that it satisfies the standards for the granting of such an extended stay and does not anticipate that the company's securities will be suspended or delisted as a result of the Notice.

Management Comments

• The Company believes that it satisfies the standards for the granting of such an extended stay and does not anticipate that the Company's securities will be suspended or delisted as a result of the Notice.
• The Company plans to file the Form 10-K as promptly as practicable and currently expects to do so prior to the hearing, at which point the Company will be in compliance with the Listing Rules.

Industry Context

Many financial institutions face challenges in maintaining compliance with regulatory filings, and delays can trigger delisting notices from exchanges like Nasdaq. Primis's situation highlights the importance of timely and accurate financial reporting in the banking sector.

Comparison to Industry Standards

• Comparing Primis to regional banks of similar asset size, a delay in filing a 10-K is generally viewed negatively by the market.
• Companies like Southern National Corporation and United Bankshares, Inc. are examples of regional banks that have maintained consistent compliance with SEC filings, which is reflected in their stable stock performance.
• Failure to meet filing deadlines can lead to increased scrutiny from regulators and investors, potentially impacting the company's valuation and access to capital.

Stakeholder Impact

• Shareholders face the risk of delisting, which could negatively impact the stock price.
• Employees may experience uncertainty due to the company's compliance issues.
• Customers may be concerned about the stability of the bank.
• Creditors may reassess their risk exposure to the company.

Next Steps

• Primis will participate in a hearing before the Nasdaq Hearings Panel.
• Primis plans to file the Form 10-K as promptly as practicable and expects to do so prior to the hearing.

Key Dates

Keywords

Delisting, Nasdaq, Form 10-K, Compliance, Primis Financial Corp, FRST, SEC, Appeal