Quantum Provides Business Update on Non-Compliance with Nasdaq

Quantum Corporation filed a Form 8-K regarding several business updates, including reiterating its efforts to be current with its SEC financial reports by May 7, 2024.

On March 19, 2024, it received a letter from the listing qualifications staff of The Nasdaq Stock Market LLC regarding the company’s non-compliance with the $1.00 bid price requirement for continued listing on the Nasdaq Global Market, as set forth in Nasdaq Listing Rules 5450(a)(1). Accordingly, it requested a hearing in response to the letter to present to the Nasdaq Hearings Panel its plan to comply with all applicable requirements for continued listing on Nasdaq and request an additional 180-day extension to do so. Although there can be no assurance that the panel will grant the company’s request for an extension, it is diligently working to comply with all of the applicable Nasdaq listing criteria within the period of time that the Panel may grant.

Also as part of today’s news, Quantum filed a Form 8-K regarding an amendment to its term loan credit and security agreement, which stipulates that proceeds related to the disposition of assets be used to improve financial flexibility, including the pay-down of existing debt. This amendment is consistent with the company’s broader efforts to prioritize certain financial and business projects targeting improvements to working capital, acceleration of new products and a more focused business.

As previously disclosed, the company is in the process of re-evaluating its application of standalone selling price under Accounting Standards Codification Topic 606 (ASC 606) that has resulted in the delayed filing of its Form 10-Qs for the second and third fiscal quarters of fiscal year ending March 31, 2024. This re-evaluation process has involved an extensive and detailed analysis of the current financial periods as well as historical quarterly and annual reports. Although the company, along with its independent registered public accounting firm, is making significant progress, additional time is being taken in order to make a final determination.