8-K: Zevia PBC Faces NYSE Delisting Threat After Share Price Falls Below $1

Zevia PBC has received a notice from the New York Stock Exchange for non-compliance with listing standards due to its stock price falling below $1 for a sustained period.

Summary

• Zevia PBC was notified by the NYSE on June 26, 2024, that it is not in compliance with listing standards because its average stock price was below $1 for 30 consecutive trading days.
• The company has a six-month period to regain compliance, which can be achieved if the stock price closes at or above $1 on the last trading day of any month within that period and maintains an average of $1 over the preceding 30 trading days.
• Zevia intends to respond to the NYSE within 10 business days and is considering all available options to regain compliance.
• The notice does not immediately delist the stock, and it will continue to trade on the NYSE during the cure period.
• The company's business operations and SEC reporting requirements are not expected to be impacted by this notice.

Sentiment

Score: 3

Explanation: The sentiment is negative due to the delisting notice and the company's stock price falling below $1. While the company has time to regain compliance, the situation presents a significant challenge.

Positives

• The notice does not result in immediate delisting of Zevia's stock from the NYSE.
• Zevia has a six-month period to regain compliance with the NYSE listing standards.
• The company intends to respond to the NYSE and is considering all available options to regain compliance.
• The notice is not expected to impact the company's business operations or SEC reporting requirements.

Negatives

• Zevia's stock price has fallen below the minimum threshold of $1 for 30 consecutive trading days.
• The company is now at risk of being delisted from the NYSE if it does not regain compliance within six months.

Risks

• There is a risk that Zevia may not be able to regain compliance with the NYSE listing standards within the six-month cure period.
• Failure to regain compliance could result in the delisting of Zevia's stock from the NYSE.
• The company's stock price may be negatively impacted by the delisting notice.

Future Outlook

Zevia intends to regain compliance with NYSE listing standards and is considering all available options to do so. The company will continue to trade on the NYSE during the cure period.

Management Comments

• Zevia intends to respond to the NYSE within 10 business days affirming its intent to cure the deficiency.
• The company intends to remain listed on the NYSE and is considering all available options to regain compliance.

Industry Context

This announcement highlights the challenges faced by companies with declining stock prices, particularly in maintaining listing compliance on major exchanges. It is not uncommon for companies to receive such notices, and the focus is now on Zevia's ability to execute a plan to regain compliance.

Comparison to Industry Standards

• Many companies in the consumer packaged goods sector have faced similar challenges with stock price volatility.
• Companies like Celsius Holdings (CELH) and National Beverage Corp (FIZZ) have experienced periods of stock price fluctuations, but have generally maintained compliance with listing standards.
• The key difference is that Zevia's stock price has fallen below the critical $1 threshold, triggering the delisting notice, which is a more serious situation than typical price volatility.

Stakeholder Impact

• Shareholders may experience a decline in the value of their investment due to the delisting notice.
• Employees may be concerned about the company's future prospects.
• Customers and suppliers may not be directly impacted by this notice.

Next Steps

• Zevia will respond to the NYSE within 10 business days.
• The company will consider available options to regain compliance with the NYSE listing standards.
• Zevia will need to achieve a closing share price of at least $1.00 and an average closing share price of at least $1.00 over a 30 trading-day period by the end of any month within the six-month cure period.

Key Dates

Keywords

NYSE, delisting, stock price, compliance, listing standards, Zevia, ZVIA