NEW YORK ( TheStreet) -- Sirius XM ( SIRI) and a handful of other stocks trading under $1 are quickly running out of time before a March 15 delisting deadline from the Nasdaq.

Sirius XM, like several other stocks, has until Monday to satisfy a Nasdaq listing rule that requires a stock to maintain a minimum bid price of $1. While Sirius XM has several options it can use to regain compliance, investors in other companies are less sure of what the future holds for their penny stock investments.

>>10 Stocks Facing Delisting Deadlines

If a stock closes below the $1 mark for 30 consecutive business days, it is granted a grace period of 180 calendar days to regain compliance with the Nasdaq's listing requirements. To regain compliance, a stock like Sirius XM would have to close at or above $1 for a minimum of 10 consecutive trading sessions.
Sirius

The Nasdaq temporarily suspended the minimum bid listing requirement on Oct. 16, 2008, during the height of economic recession. The move allowed stocks trading under $1 to continue trading on the exchange. That temporary suspension was lifted on July 31, 2009, and the Nasdaq resumed sending out delisting warning letters to companies that were not in compliance.

March 15 is the day the so-called grace period ends for the first batch of companies that received a delisting notice after the Nasdaq reinstituted the minimum bid price requirement last year. Sirius XM is among that group, which first received non-compliance letters from the exchange in September. With fewer than 10 business days remaining until the deadline, these companies now have to look to other remedies to remain listed on the Nasdaq.

Companies with shares that trade for pennies already have difficulty finding analyst coverage and institutional buyers. A delisting and move to the OTC Bulletin Board could mean a further slide below the $1 mark for many companies.

Take Verso Technologies ( VRSOQ.PK), which had faced the same March 15 delisting deadline before moving to the Pink Sheets. The stock now trades for a fraction of a penny. Similarly, Hythiam ( HYTH.OB) was up against the March 15 deadline before moving to the OTC Bulletin Board on Feb. 26. Shares traded as high as 64 cents in early January, but have since fallen to roughly 23 cents.

Robert Pavlik, chief market strategist with Banyan Partners, acknowledges that the OTC and Pink Sheets do serve a purpose, but he notes that most investors don't look favorably on a stock that drops off the Nasdaq.

"Everyone loses track of you. Going to the Pink Sheets is like being put out to Siberia," Pavlik says. "It has a very negative connotation. There is a whole world of daytraders who focus on those names and love to trade those penny stocks. But the spreads are generally larger and the liquidity certainly isn't there. A lot of professional traders won't go to a place they consider to be like the Wild West. It becomes more difficult to track those names. Why subject yourself to that type of risk?"

Thankfully, there are still ways for a stock to remain listed on the Nasdaq even if it does not meet the minimum bid price requirement. A company could institute a reverse stock split to artificially push a stock above $1. Alternatively, a company could apply for a transfer to the Nasdaq Capital Markets -- if they meet the other necessary requirements -- and request another 180-day grace period to address the minimum bid price mandate.

Companies could also appeal for a meeting with a Nasdaq Hearing Panel within seven days of receiving a delisting warning on March 15. A company could not be delisted until the Nasdaq's Hearing Panel has issued a written decision.

Robert Kauffman, Chairman and CEO of Alanco Technologies ( ALAN), an information technology solutions provider, says that the Nasdaq may have been premature in reinstituting the minimum bid price bid when it did so last year.

While he acknowledges that his view may be self-serving, as Alanco is among the companies facing the March 15 deadline, Kauffman still argues that the recovery has been a slow one, especially for small-cap companies, and that the Nasdaq should have recognized that.

"I think it was a little too soon. Some of the major market indices have recovered, but in the micro-cap area there hasn't been much of a recovery at all," Kauffman said. "That's why you have so many Nasdaq companies listed under $1. That tells you something." As of March 10, 105 companies are on the Nasdaq's deficiency list due to the bid price requirement.

Kauffman, who said Alanco will ask the Nasdaq for a 180-day extension and will use a shareholder-approved reverse stock split as a last resort, agrees with the view that the exchange's minimum bid price requirement is pointless as companies can simply institute a reverse stock split to regain compliance.

"All you have to do is reverse split and you're back in the Nasdaq's good graces, which I think is kind of ridiculous," Kauffman said. Nothing does fundamentally change. It's all cosmetic. It's the Nasdaq's image of themselves. They don't want to have a whole bunch of companies that are under $1, because they think that seems to be too speculative."

Kauffman notes that even several big name companies are on the Nasdaq's list, like Sirius XM. With revenue of $2.47 billion over the last 12 months, Sirius XM is one of the most-traded stocks on the Nasdaq. Investors in the satellite radio company have long debated whether the stock will actually be delisted from the exchange. The satellite radio operator has several options before it would be bounced from the Nasdaq, including a reverse stock split (which shareholders have already approved), so there is little doubt that it will continued to be listed on the Nasdaq.

For a handful of other lesser known companies, like ChipMOS ( IMOS), Xoma ( XOMA) and Cosi ( COSI), the future is cloudier. With Monday's deadline around the corner, investors in these companies should beware of these stocks falling to the Pink Sheets.

-- Reported by Robert Holmes in Boston.

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