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Staffing 360 Solutions, Inc., a company providing staffing services, is set to be delisted from the NASDAQ stock market as of the morning of Thursday, February 13, 2025, due to non-compliance with the minimum stockholders’ equity requirement.
The decision, communicated on Monday, follows a failure to meet the continued listing standards as per a previous agreement with the NASDAQ Hearings Panel.
The delisting notice comes after a series of communications between Staffing 360 Solutions and NASDAQ. Initially, on June 20, 2024, the company was informed of its non-compliance with the NASDAQ Capital Market’s minimum stockholders’ equity requirement, which mandates a minimum of $2,500,000. The company’s plan to regain compliance, submitted in June and August 2024, was deemed insufficiently definitive by NASDAQ staff.
An appeal to the initial determination led to a hearing on October 3, 2024. The NASDAQ Hearings Panel granted the company’s request to continue listing, contingent upon meeting certain milestones by November 1 and December 31, 2024. However, the company did not meet these conditions, prompting the delisting decision. The company’s stock has reflected these challenges, showing a -34.77% return in the past week and a -24.69% return over the past year.
In parallel, on February 3, 2025, Staffing 360 Solutions held a special meeting of stockholders, which was adjourned to February 10, 2025. The company faces significant financial challenges, with a total debt of $41.32 million and negative EBITDA of -$10.49 million in the last twelve months. For more detailed financial analysis and additional insights, investors can access 14 more ProTips on InvestingPro.
The purpose was to adopt a Merger Agreement with Atlantic International Corp. and A36 Merger Sub, Inc., and to approve an adjournment proposal if necessary. While the adjournment proposal was approved, the CEO adjourned the meeting until February 12, 2025, to solicit additional proxies for the Merger Agreement Adoption Proposal.
Staffing 360 Solutions has the option to request a review of the delisting decision by the NASDAQ Listing and Hearing Review Council within 15 days from the receipt of the decision letter. The company’s business address is in New York, NY, and it operates under the industrial classification of Services-Help Supply Services.
In other recent news, Staffing 360 Solutions has been making strategic moves to restructure its financial obligations. The company has entered into a conversion agreement with Jackson Investment Group, converting debt into approximately 5.6 million shares of newly designated Series I Preferred Stock.
This agreement is in line with the company’s ongoing merger plans with Atlantic International Corp. In addition, if the average closing price of Atlantic’s common stock falls below $5.00 in the last five trading days before the merger’s closing, additional shares will be issued to Jackson.
The company has also been extending its credit agreement and note maturity dates. It has extended the commitment expiry date to February 1, 2025, with MidCap Funding IV Trust, and the maturity date of certain notes to February 15, 2025, with Jackson Investment Group. These extensions are part of the company’s financial restructuring efforts, providing more time to manage its debt obligations.
Furthermore, Staffing 360 Solutions has announced amendments to its merger plans. The amendments stipulate that upon completion of the merger, each share of Series H Convertible Preferred Stock and Series I Preferred Stock, with certain exceptions, will be converted into the right to receive a number of shares of Atlantic common stock. The merger’s termination date has been extended to March 31, 2025.
In other developments, the company has held its annual stockholders meeting, during which Alicia Barker and Nicholas Florio were elected as Class II directors, and Brendan Flood was elected as a Non-Classified director. Additionally, stockholders ratified the appointment of RBSM LLP as the company’s independent registered public accountant for the fiscal year 2024.
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