Agrify, a provider of cultivation and extraction solutions for the cannabis industry, today announced that on April 18, 2023, it received a letter from the Listing Qualifications Department of the Nasdaq Stock Market notifying the company that it was not in compliance with requirements of Nasdaq Listing Rule 5250(c)(1) as a result of not having timely filed its Annual Report on Form 10-K for the fiscal year ended December 31, 2022, with the Securities and Exchange Commission.
This notification has no immediate effect on the listing of Agrify’s common stock on the Nasdaq. However, if Agrify fails to timely regain compliance with the Nasdaq Listing Rule, Agrify’s common stock will be subject to delisting from Nasdaq.
As disclosed in the Current Report on Form 8-K filed by the Company on April 17, 2023, Agrify’s audit committee concluded that, as a result of errors in the accounting for warrants previously issued by Agrify, it is appropriate to restate Agrify’s previously issued unaudited condensed consolidated financial statements as of and for the fiscal periods ended March 31, 2022, June 30, 2022 and September 30, 2022 in amended quarterly reports for the affected periods. Given the scope of the process for preparing the amended quarterly reports, Agrify was unable to complete and file the Form 10-K for the fiscal year ended December 31, 2022 by the required due date of March 31, 2023. On March 31, 2023, the Company filed a Form 12b-25 Notification of Late Filing with the SEC related to the Form 10-K.
Under the Nasdaq rules, the company has 60 calendar days, or until June 20, 2023, to submit to Nasdaq a plan to regain compliance with the Nasdaq Listing Rule. If Nasdaq accepts the company's plan, then Nasdaq may grant the company up to 180 days from the prescribed due date for filing the Form 10-K to regain compliance. If Nasdaq does not accept the company's plan, then the company will have the opportunity to appeal that decision to a Nasdaq Hearings Panel.
The company is working diligently and expects to file its Form 10-K within the 60-day period, which would eliminate the need for the Company to submit a formal plan to regain compliance.