Esports organization FaZe Clan has officially been served a deficiency notice from the Nasdaq stock exchange, as their share price has remained below $1 for more than 30 consecutive business days.
The company now has a 180-day period to regain compliance, which requires the share price to recover to over $1 and remain at that price for 10 consecutive trading days.
As of March 24, FaZe stock had closed below the $1 minimum for 32 trading days, which exclude weekends and national holidays.
In March 23, FaZe received a letter from Nasdaq informing them that their common stock “failed to comply with the $1 minimum bid price required for continued listing on The Nasdaq Capital Market,” for 30 consecutive business days.
“In accordance with Nasdaq Listing Rule 5810(c)(3)(A), the Company has been provided an initial period of 180 calendar days, or until September 19, 2023 (the “Compliance Date”), by which the Company has to regain compliance with the minimum bid price requirement,” a March 24 SEC filing reads.
“To regain compliance, the closing bid price of the Common Stock must meet or exceed $1.00 per share for a minimum of ten consecutive business days.”
As of close of trading on March 24, FaZe Clan’s stock price sits at $0.67. The all-time peak was in August 2022, at over $20 per share.
Will FaZe be delisted from the stock market?
If FaZe fails to recover the stock price within the 180-day period, they may qualify for a further 180-day period. If not, they will be subject to delisting, although can appeal to the Nasdaq hearing’s panel.
The SEC filing states that FaZe “cannot provide assurance that these efforts [to regain compliance] will be successful.”
It was reported on the same day that FaZe Clan is currently exploring options to take the company back private, less than a year after they began trading on the public market.
FaZe, like many companies in the esports and gaming industry, has laid off staff and said the move was necessary for their aim of “financial discipline.”
Matthew ‘Nadeshot’ Haag, founder of esports organization 100 Thieves, claimed that FaZe Clan’s performance on the stock market would have a negative impact on other organizations too.
FaZe has also been facing an internal battle, as a handful of original members have spoken out against the organization’s treatment of them, allegations they’ve since responded to, “We know that for too long we haven’t been the FaZe we need to be, but we’re working hard towards fixing that.”
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