GlobeImmune Inc. (NASDAQ:GBIM) Faces Delisting Nightmare

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GlobeImmune Inc. (NASDAQ: GBIM) was recently notified by the Nasdaq Stock Market that it had fallen short of the continued listing requirements and risked delisting from the stock exchange market. The company hinted in a securities filing that it may submit a plan to NASDAQ detailing how it hopes to become compliant again. GlobeImmune has 45 days from the date it received the notification of non-compliance to submit its plan.

But submitting a plan is only the first step. Once GlobeImmune submits its compliance plan, it will wait for a feedback from NASDAQ to know whether its plan has been accepted or rejected. If the plan is rejected, NASDAQ may begin a process of delisting GlobeImmune.

If the plan is accepted, GlobeImmune Inc. (NASDAQ: GBIM) would have 180 days from the date it received the notice of non-compliance to regain compliance for continued listing on NASDAQ. But the company could also fail to regain compliance even after the 180 days allowed to do so and in that case, its delisting process may be initiated at NASDAQ. However, the company could still request for a hearing of the matter and it will remain listed on NASDAQ until the hearing is concluded.

Shares of GlobeImmune recently shot up in an apparent speculation that the company would submit a plan to regain compliance and that the plan would be endorsed by NASDAQ.

What’s the genesis of the headache?

GlobeImmune Inc. (NASDAQ: GBIM) has come to the point where it has to fight to remain on NASDAQ stock market after its stockholder equity fell below the required minimum of $2.5 million. The issue of falling short of the minimum stockholder equity arose from GlobeImmune’s filing of its 1Q2016 financial results.

The other reason for GlobeImmune’s delisting risk is that the company’s market value and net income from operations have also fallen below the minimum requirements.

Liquidity position GlobeImmune Inc. (NASDAQ: GBIM)

Despite the delisting threat, GlobeImmune Inc. (NASDAQ: GBIM) recently said that it had enough cash that is sufficient to fund its operations until the middle of 2017. But the company is in the process of exploring strategic alternatives to ensure that it has enough funds to keep it in operation longer. However, the management warned that if the company’s strategic review didn’t result in a favorable deal, it might be forced to wind down certain operations.

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