Monster Digital Inc. has received a letter from the Nasdaq about non-compliance with the exchange’s stockholder equity requirement, which could serve as a basis for delisting the stock, the company announced Monday.
The Simi Valley digital camera manufacturer plans to request a hearing on the issue, where it will present a plan for regaining compliance. The panel could grant the company an extension until April 17.
“The company’s common stock will continue to trade on Nasdaq under the symbol MSDI at least pending the ultimate conclusion of the hearing process,” the company said in its announcement.
In July, Monster Digital announced a reverse merger agreement with Innovate Biopharmaceuticals Inc. in Raleigh, N.C. Under the agreement, after the merger Innovate shareholders will own about 91 percent of the company and Monster shareholder will own about 9 percent. The combined company plans to use the public capital market to finance clinical trials for a drug to treat celiac disease.
The companies expect the merger to be complete by the end of the year.
Shares of Monster Digital (MSDI) closed Monday down a fraction of a cent, or 2.2 percent, to 62 cents on the Nasdaq.