8-K: Stem, Inc. Receives Notice of Non-Compliance from NYSE Due to Low Share Price

Stem, Inc. has received a notice from the New York Stock Exchange stating that its average share price has fallen below the required minimum for continued listing.

Summary

• Stem, Inc. received a notice from the NYSE on August 28, 2024, indicating that its average share price had fallen below $1.00 over 30 consecutive trading days.
• This violates the NYSE's continued listing requirements under Section 802.01C of the NYSE Listed Company Manual.
• Stem has 10 business days to respond to the NYSE regarding its plan to regain compliance.
• The company has a six-month cure period to achieve a closing share price of at least $1.00 and an average closing price of at least $1.00 over a 30-day period ending on the last trading day of any month during the cure period.
• Failure to meet these conditions could result in delisting from the NYSE.
• The notice does not impact Stem's business operations, reporting obligations with the SEC, or cause any defaults under its debt agreements.

Sentiment

Score: 3

Explanation: The sentiment is negative due to the non-compliance notice and the risk of delisting. However, the company has a cure period, which provides a chance for recovery.

Positives

• The notice does not affect Stem's business operations or its reporting obligations with the SEC.
• The notice does not cause any defaults under Stem's debt agreements.
• Stem has a six-month cure period to regain compliance with NYSE listing standards.

Negatives

• Stem's average share price has fallen below the minimum required for continued listing on the NYSE.
• The company faces the risk of delisting if it fails to regain compliance within the six-month cure period.

Risks

• Failure to regain compliance with NYSE listing standards could lead to delisting.
• The company's share price may be volatile during the cure period.
• There is a risk that the company may not be able to achieve the required share price within the cure period.

Future Outlook

Stem intends to respond to the NYSE within 10 business days regarding its plan to cure the deficiency and regain compliance. The company has a six-month cure period to achieve the required share price and average share price.

Management Comments

• Stem will respond to the NYSE within 10 business days of receipt of the notice regarding its intent to cure the deficiency and return to compliance with the NYSE continued listing requirements.
• Statements in this press release are made as of the date of this release, and Stem disclaims any intention or obligation to update publicly or revise such statements, whether as a result of new information, future events, or otherwise, except as required by law.

Industry Context

This announcement highlights the challenges faced by companies in maintaining share price compliance, particularly in volatile market conditions. It is not uncommon for companies to receive such notices, and the focus is now on Stem's ability to execute its plan to regain compliance.

Comparison to Industry Standards

• Many companies in the technology and renewable energy sectors have faced similar challenges with share price volatility.
• Companies like SunPower and Enphase Energy have also experienced periods of share price fluctuations, although not necessarily leading to delisting notices.
• The six-month cure period is a standard procedure by the NYSE, providing companies with a defined timeframe to address the issue.

Stakeholder Impact

• Shareholders may experience increased volatility in the stock price.
• Employees may be concerned about the company's future prospects.
• Customers and suppliers may monitor the situation closely.

Next Steps

• Stem will respond to the NYSE within 10 business days regarding its plan to regain compliance.
• The company will work to achieve a closing share price of at least $1.00 and an average closing price of at least $1.00 over a 30-day period ending on the last trading day of any month during the cure period.

Key Dates

Keywords

NYSE, delisting, share price, compliance, listing standards, cure period, Stem Inc, stock