Item 3.01. Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing.
On January 11, 2023, Latch, Inc. (the “Company”) received a written notice (the “Notice”) from the Listing Qualifications Department of The Nasdaq Stock Market LLC (“Nasdaq”) notifying the Company that, based on the closing bid price for the Company’s common stock, par value $0.0001 per share (the “Common Stock”), for the last 30 consecutive trading days prior to the date of the Notice, the Company no longer complies with the minimum closing bid price requirement for continued listing on the Nasdaq Global Select Market pursuant to Nasdaq Listing Rule 5450(a)(1) (the “Minimum Bid Price Requirement”).
The Notice has no immediate effect on the listing or trading of the Common Stock or the Company’s warrants on the Nasdaq Global Select Market. Pursuant to Nasdaq Listing Rule 5810(c)(3)(A), the Company is provided with an initial compliance period of 180 calendar days, or until July 10, 2023, to regain compliance with the Minimum Bid Price Requirement. To regain compliance, the closing bid price of the Common Stock must be at least $1.00 per share for a minimum of ten consecutive trading days prior to July 10, 2023, and the Company must otherwise satisfy the Nasdaq Global Select Market’s requirements for listing.
In the event the Company does not regain compliance by July 10, 2023, the Company may be eligible for an additional 180-calendar day compliance period if it elects to transfer the listing of the Common Stock to the Nasdaq Capital Market. To qualify, the Company must meet the continued listing requirement for the applicable market value of publicly held shares requirement and all other applicable initial listing standards for the Nasdaq Capital Market, with the exception of the minimum bid price requirement, and provide written notice of its intention to cure the minimum bid price deficiency during the second compliance period. If the Company does not regain compliance within the compliance period(s), including any extensions that may be granted by Nasdaq, the Common Stock will be subject to delisting.
The Company intends to actively monitor the closing bid price for the Common Stock and will consider available options to resolve the deficiency and regain compliance with the Minimum Bid Price Requirement. While the Company plans to review all available options, there can be no assurance that it will be able to regain compliance with the applicable rules during the 180-calendar day compliance period, any subsequent extension period, or at all, or that the Company will otherwise remain in compliance with the other applicable Nasdaq listing standards.
The Notice is unrelated to the previously disclosed notices received by the Company from Nasdaq on August 11, 2022 and November 14, 2022 regarding the Company’s failure to file its Quarterly Reports on Form 10-Q for the quarters ended June 30, 2022 and September 30, 2022, respectively (together, the “Delinquent Reports”). As previously disclosed, Nasdaq granted an exception for the Company to regain compliance by filing the Quarterly Reports by February 6, 2023 (the “Deadline”). While the Company does not anticipate filing the Delinquent Reports by the Deadline, the Company intends to file the Delinquent Reports as soon as reasonably practicable.