8-K: Real Good Food Company to be Delisted from Nasdaq Due to Reporting Failures

The Real Good Food Company will be delisted from the Nasdaq due to its failure to file required financial reports, and its stock will move to the OTC market.

Summary

• The Real Good Food Company has received a notice from Nasdaq that it will be delisted due to the company's failure to file required periodic financial reports.
• Trading of the company's stock on Nasdaq will be suspended on January 7, 2025.
• The company's stock is expected to begin trading on the Pink Open Market, operated by the OTC Markets Group, on January 7, 2025.
• Due to the company's ongoing issues with timely filings, it is anticipated that the stock will be quoted on the OTC's Expert Market, where public viewing of quotes will not be available.
• There is no guarantee that a market for the company's shares will develop on the OTC Expert Market.

Sentiment

Score: 2

Explanation: The delisting from Nasdaq and potential move to the OTC Expert Market is a very negative development, indicating significant issues with financial reporting and corporate governance. The lack of transparency and liquidity on the OTC Expert Market further reduces investor confidence.

Negatives

• The company has failed to comply with Nasdaq listing requirements by not filing periodic financial reports.
• The company's stock will be delisted from Nasdaq.
• The company's stock may be moved to the OTC Expert Market, where public quotes will not be available.
• There is no guarantee that a market for the company's shares will develop on the OTC Expert Market.

Risks

• There is a risk of further delays in filing the company's late periodic reports and restated financial statements.
• There is a risk of discovering additional information regarding errors in previously issued financial statements.
• The scope of the restatement of previously issued financial statements is uncertain.
• There is a risk related to the remediation of identified material weaknesses in internal control over financial reporting.
• There is no guarantee that a market for the company's shares will develop on the OTC Expert Market.

Future Outlook

The company anticipates its common stock will begin trading on the OTC Pink Open Market, but may move to the OTC Expert Market where public quotes will not be available. There is no guarantee that a market for the company's shares will develop.

Management Comments

• Management has attempted to identify forward-looking statements by using words such as anticipate, believe, estimate, expect, intend, may, plan, predict, project, should, will, or would, and similar expressions or the negative of these expressions.
• Management's current expectations and predictions are based on information available as of the time such statements are made.
• The company does not make forward-looking statements unless it believes it has a reasonable basis for doing so, but cannot guarantee their accuracy or completeness.

Industry Context

This announcement reflects a significant failure in corporate governance and financial reporting, which is a major concern for investors. Delisting from a major exchange like Nasdaq can severely impact a company's access to capital and investor confidence.

Comparison to Industry Standards

• Delisting from Nasdaq is a significant negative event, as companies typically strive to maintain their listing status to ensure investor confidence and access to capital.
• Companies like Beyond Meat and Tattooed Chef, which operate in the same food industry, have maintained their Nasdaq listings, highlighting the severity of Real Good Food Company's situation.
• The move to the OTC market, particularly the Expert Market, is a significant downgrade, as it indicates a lack of transparency and liquidity compared to Nasdaq-listed peers.

Stakeholder Impact

• Shareholders will likely experience a significant loss in value due to the delisting and move to the OTC market.
• The company's reputation and brand image may be negatively impacted.
• Employees may experience uncertainty about the company's future.

Next Steps

• The company's stock is expected to commence trading on the OTC Pink Open Market on January 7, 2025.
• The company may move to the OTC Expert Market, where public quotes will not be available.

Key Dates

Keywords

delisting, Nasdaq, OTC, financial reports, expert market, RGF, Real Good Food Company, stock market