Item 3.01. Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing.
On August 14, 2019, JAKKS Pacific, Inc. (the “Company”) received a written notice (the “August 14 Notice”) from the Listing Qualifications Staff of The Nasdaq Stock Market LLC (“Nasdaq”) notifying the Company that it is not in compliance with Nasdaq Listing Rule 5450(b)(1)(A), which requires that companies listed on Nasdaq maintain a minimum of $10,000,000 stockholders’ equity for continued listing, because the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2019 reported the Company’s stockholders’ equity as $1,632,000. The August 14 Notice has no immediate effect on the listing or trading of the Company’s common shares, which will continue to trade on Nasdaq under the symbol “JAKK”.
In accordance with the August 14 Notice, the Company has 45 calendar days to submit a plan to regain compliance. If the plan is accepted, Nasdaq can grant an extension of up to 180 calendar days from the date of the August 14 Notice for the Company to regain compliance. If Nasdaq determines that the Company’s plan of compliance is not sufficient, the Company will have an opportunity to appeal the decision to a hearings panel. There can be no assurance that, if the Company does appeal Nasdaq’s determination to the hearing panel, that such appeal would be successful. If unsuccessful, the Company’s shares will be delisted.
The Company is in the process of reviewing potential actions and responses regarding the non-compliance set forth in the August 14 Notice.
The August 14 Notice is in addition to the written notice that the Company received from Nasdaq on June 24, 2019 and disclosed in the Company’s Current Report on Form 8-K filed on June 28, 2019, notifying the Company that its common shares closed below the $1.00 per share minimum bid price required by Nasdaq Listing Rule 5450(a)(1) for 30 consecutive business days. The Company has until December 23, 2019 to demonstrate compliance with the minimum bid price requirement. The August 14 Notice does not change that deadline.