Hallmark Financial announces voluntary delisting from Nasdaq

Hallmark Financial announced its decision to voluntarily delist its shares of common stock from the Nasdaq Global Market. This strategic decision was disclosed in a company release on December 26, 2023, and is set to reshape the company’s stock market presence.

The company provided formal notice to the Nasdaq Stock Market LLC of its intention, with trading of its common stock scheduled to be suspended at the opening of business on January 5, 2024. Hallmark plans to officially file a Form 25 with the Securities and Exchange Commission (SEC) around January 5, 2024. The delisting of its common stock is expected to take effect no sooner than ten days after this filing.

This decision follows a series of regulatory challenges faced by Hallmark. On September 28, 2023, Nasdaq Regulation notified the company that it no longer met the minimum “Market Value of Publicly Held Shares” (MVPHS) requirement of $5,000,000 over the past 30 consecutive business days. This is a critical compliance criterion under Rule 5450(b)(1)(c) for continued listing on the Nasdaq Global Market.

Furthermore, on November 16, 2023, the company was informed of another non-compliance issue. It failed to maintain the minimum stockholders’ equity of $10,000,000, as required by Rule 5450(b)(1)(A) for continued listing on the Nasdaq Global Market. The company was given until January 2, 2024, to submit a Remediation Plan to address this deficiency.

However, the company’s Board of Directors concluded that there was no viable Remediation Plan that could be presented to Nasdaq by the January deadline. Additionally, there were significant doubts about the company’s ability to regain compliance with the MVPHS requirement in the given timeframe. Consequently, the Board approved the delisting from the Nasdaq Global Market, considering it an inevitable transition.

Post-delisting, Hallmark anticipates that its shares will be quoted on the Pink market or another market operated by OTC Markets Group Inc. (OTC). This move is aimed at ensuring a continued trading market for its common stock, although there is no certainty that trading will continue on an OTC Market or elsewhere.