FaZe Clan in serious trouble after failing to comply with Nasdaq listing rules

Following a communication from the SEC this past Friday, FaZe Holdings announced receipt of a notice from the Nasdaq Stock Market Trading Ratings Department informing it that “does not meet the $1 minimum offer price required to continue trading on The Nasdaq Capital Market under Nasdaq Listing Rule 5550(a)(2) based on the 30-day closing offer price of the Common Stock consecutive working days prior to the date of the Letter.” Esports Bureau already echoed FaZe’s price drop a few weeks ago.

FaZe Clan’s stock price fell below $1 on January 20 for the first time. Although the shares rallied to a price of more than $1 in the days that followed, February 8th marks the last day FaZe shares traded above $1. From the moment of receiving the exclusion notification, the company has 180 calendar days, (the period ends on September 19) to return to comply with the requirements. To regain compliance with Nasdaq, the closing offering price of the common shares “must equal or exceed $1.00 per share for a minimum of ten consecutive business days”.

This can happen at any time within the 180-day period. You may also be eligible for an extension of an additional 180 calendar day compliance period.

It’s no secret that FaZe Clan is in dire straits. With the company’s annual results due to be released next week, its share price is unlikely to recover above $1, considering that investors might not like the 2022 shortfall that FaZe will reveal. The delisting notice itself will be one of its minor headaches, though, as a reverse stock split would bring the company back into compliance with Nasdaq listing rules without fixing any of the underlying issues. of the company In this scenario, a reverse stock split of 10:1 would mean current shareholders would receive 1 share for every 10 shares they currently own, consequently increasing the share price by 10 times and increasing FaZe’s stake by a safe range. above $5 per shareno.

Tobias Seck, Business Analyst.

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