Oh dear. Not a great start to the year for THQ. Although the company issued a rallying call at the start of 2012, refocusing the company's business strategy, the fall in share prices - not to mention rumours of deep internal discontent - has placed the company in a difficult situation.
THQ was hit with Form 8-K which stipulates that the company has until July 23th for the bid price of its stock to rise above $1 per share for a minimum of 10 consecutive days. THQ's stock is currently sitting at 70 cents a share, having fallen from a previous high of $36 over the last four years.
Form 8-K for THQ INC
Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer
Item 3.01 Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing
On January 25, 2012, THQ Inc., a Delaware corporation (the "Company"), received a written notification from Nasdaq notifying the Company that it fails to comply with Nasdaq's Marketplace Rule 5450(a)(1) (the "Rule") because the bid price for the Company's common stock, over the last 30 consecutive business days, has closed below the minimum $1.00 per share requirement for continued listing. The notification has no immediate effect on the listing of the Company's common stock.
In accordance with Marketplace Rule 5810(c)(3)(A), the Company has a period of 180 calendar days, or until July 23, 2012, to regain compliance with the Rule. If at any time before July 23, 2012, the bid price of the Company's common stock closes at or above $1.00 per share for a minimum of 10 consecutive business days, Nasdaq will provide written notification that the Company has achieved compliance with the Rule. If compliance with the Rule cannot be demonstrated by July 23, 2012, the Company's common stock will be subject to delisting from The Nasdaq Global Market.
In the event that the Company receives notice that its common stock is subject to being delisted from The Nasdaq Global Select Market, Nasdaq rules permit the Company to appeal any delisting determination by the Nasdaq staff to a Nasdaq hearings panel. Alternatively, Nasdaq may permit the Company to transfer its securities to The Nasdaq Capital Market if it satisfies the requirements for initial inclusion set forth in Marketplace Rule 5505, except for the bid price requirement. If its application for transfer is approved, the Company would have an additional 180 calendar days to comply with the Rule in order to remain on The Nasdaq Capital Market.
The Company will continue to monitor the bid price for its common stock and consider various options available to it if its common stock does not trade at a level that is likely to regain compliance.