BOSTON ( TheStreet) -- Small-cap stocks, measured by the Russell 2000 Index, were hit hard in May and trailed the broader market as investors sought the safety of large-cap shares such as Procter & Gamble ( PG) and Colgate-Palmolive ( CL).The underperformance of small-cap stocks is worrisome, given they inherently carry higher risks than their larger peers do. One of those is the inability to remain compliant with listing standards of the Nasdaq, spurring delisting warnings from the exchange.
First Federal Bancshares of Arkansas ( FFBHD) Company Profile: First Federal Bancshares of Arkansas is a savings and loan holding company, which through its subsidiary, First Federal Bank, provides a line of financial products to individuals and small- to medium-sized businesses. Current Share Price: $9.65 (as of last Friday, May 27) Listing Violation: Public float. The listing rule requires that a company have at least 750,000 publicly held shares for continued listing. Currently, First Federal Bancshares of Arkansas has a public float of about 376,000 shares. Received Nasdaq Notice: May 4 Management's Expected Action: The company said it expected to get a warning letter from the Nasdaq after it completed a reverse stock split, which reduced the number of shares outstanding. First Federal Bancshares of Arkansas has until June 20, to submit a plan to regain compliance. If the plan is accepted, the company would have until Oct. 31 to regain compliance with the rule. The company said that it already plans to issue up to 2.9 million shares of its common stock through a rights offering before June 20.
Anchor BanCorp Wisconsin ( ABCW) Company Profile: Anchor BanCorp Wisconsin is engaged in the savings and loan business through its wholly owned banking subsidiary, AnchorBank. Current Share Price: 75 cents (May 27) Listing Violation: Bid price. The listing rule requires that a company maintains a minimum closing bid price of $1 per share for its common stock. Anchor BanCorp Wisconsin shares last closed above $1 on March 29. Received Nasdaq Notice: May 13 Management's Expected Action: Anchor BanCorp says it has until Nov. 9 to regain compliance with the bid price requirement. The company said it is "currently evaluating its alternatives to resolve the listing deficiency."
TAT Technologies ( TATT) Company Profile: TAT Technologies provides a variety of services and products to the military and commercial aerospace and defense industries through its Gedera facility, as well as through its subsidiaries, Bental, in Israel, and Limco in the U.S. Current Share Price: $5.80 (May 27) Listing Violation: Audit committee composition. The listing rule requires that a majority of the board of directors must consist of independent directors and that the company's audit committee have at least three members, all of whom must be independent. Received Nasdaq Notice: May 16 Management's Expected Action: On May 24, TAT Technologies announced that its board has elected Anat Hollander as an independent director and a member of the company's audit committee, which remedies the listing deficiency.
China Integrated Energy ( CBEH) Company Profile: China Integrated Energy is a non-state-owned integrated energy company in China, engaged in the wholesale distribution of finished oil and heavy oil products; the production and sale of biodiesel and; the operation of retail gas stations. Current Share Price: $1.84 (trading has been halted since April 20) Listing Violation: Public interest concern, audit committee composition and board independence. Received Nasdaq Notice: May 16 Management's Expected Action: The public interest concern comes as the Nasdaq alleges that the company obstructed the board's independent investigation following complaints relating to accounting, internal accounting controls or auditing matters. KPMG has already advised that its previously issued audit report should no longer be relied upon. In addition, the Nasdaq noted that the company's audit committee has been unable to conduct an independent investigation into the serious allegations. China Integrated Energy has already said it plans to appeal the Nasdaq's determination. However, the company is facing several class action lawsuits from shareholders. One firm, Kaplan Fox & Kilsheimer LLP, filed a complaint that alleges company executives "made false and misleading statements and material omissions regarding China Integrated Energy's business, operations, management and the intrinsic value of China Integrated Energy." The complaint also alleges improper acquisitions and the wrongful transfer of cash by the company to Gao Bo, the son of China Integrated Energy's CEO.
China Automotive Systems ( CAAS) Company Profile: China Automotive Systems makes power-steering systems and other component parts for cars. Current Share Price: $7.70 (May 27) Listing Violation: Delinquent. In March, China Automotive Systems was hit with a separate delisting notice after it failed to file its annual 10-K report with the SEC in a timely manner. Received Nasdaq Notice: May 16 Management's Expected Action: China Automotive announced previously that it has to restate financial statements for fiscal 2009 and the first three quarter of fiscal 2010 due to the accounting treatment of its convertible notes issued in February 2008. Because of the restatement, China Automotive has failed to submit its Form 10-K for 2010 and the Form 10-Q for the first quarter of 2011. In response to the Nasdaq's letter, China Automotive provided its plan for regaining compliance on May 13. The company said it believes that it will be able to file its amended reports before the end of June 2011, and it expects that these filings will allow it to regain compliance with the Nasdaq listing rules.
First Place Financial ( FPFC) Company Profile: First Place Financial is a community-oriented financial institution engaged mainly in gathering deposits to originate one- to four-family residential mortgage loans, commercial and consumer loans. Current Share Price: $1.40 (May 27) Listing Violation: Delinquent. First Place Financial has delayed filing of quarter reports for periods ending Sept. 30, Dec. 31 and March 31. Received Nasdaq Notice: May 17 Management's Expected Action: First Place Financial has previously disclosed that it needs additional time to file its financial statements as it deals with the Office of Thrift Supervision, which found issues with the bank's allowance for loan losses. The company said it intends to request a hearing before the Nasdaq's Listing Panel which, if granted, will automatically stay any delisting action through at least June 8.
Wuhan General Group ( WUHN) Company Profile: Wuhan General Group manufactures industrial blowers, industrial steam and water turbines for use in electrical power generation plants. Current Share Price: 72 cents (May 27) Listing Violation: Bid price. The listing rule requires that a company maintains a minimum closing bid price of $1 per share for its common stock. Wuhan General shares last closed above $1 on March 31. Received Nasdaq Notice: May 17 Management's Expected Action: Wuhan General has until Nov. 14 to regain compliance with the minimum bid price requirement. The company said it will consider available options to resolve the noncompliance with the listing rule. This comes after the company in March said that filed financial statements for the year ended December 31, 2009 and for the quarter ended March 31, 2010 should no longer be relied upon because of errors.
Waccamaw Bankshares ( WBNK) Company Profile: Waccamaw Bankshares is engaged in attracting deposits from the general public and using such deposit funds to make commercial, consumer, and residential construction and permanent mortgage real estate loans. Current Share Price: 70 cents (May 27) Listing Violation: Delinquent. Waccamaw Bankshares failed to file its annual 10-K report and quarterly 10-Q report with the SEC in a timely manner. Received Nasdaq Notice: May 17 Management's Expected Action: Waccamaw Bankshares is required to submit a plan to regain compliance by June 3. The Nasdaq can grant the company an extension until Sept. 27 to regain compliance if the plan is approved. If the company is unable to file its annual report prior to June 3, Waccamaw said it intends to submit a plan to regain compliance to the Nasdaq no later than June 3.
Alanco Technologies ( ALAN) Company Profile: Alanco Technologies is a provider of advanced information technology solutions, such as data storage, RFID technology and wireless asset management. Current Share Price: $1.01 (May 27) Listing Violation: Public interest concern. The Nasdaq claims Alanco "no longer has any operating business" following the sale of its StarTrak Systems subsidiary to Orbcomm. Received Nasdaq Notice: May 17 Management's Expected Action: Alanco already has requested a hearing before the Nasdaq's listing panel. The company did add it "is actively pursuing new opportunities to enhance shareholder value by leveraging its assets through a strategic merger or acquisition."
CAS Medical Systems ( CASM) Company Profile: CAS Medical Systems is a medical technology company that develops, manufactures and markets non-invasive patient monitoring products used in patient care. Current Share Price: $2.60 (May 27) Listing Violation: Equity. The Nasdaq requires a minimum stockholders' equity of $10 million for continued listing. CAS Medical's stockholders' equity as of March 31 was $9.4 million. Received Nasdaq Notice: May 18 Management's Expected Action: While CAS Medical has 45 days to submit a plan to the Nasdaq for how it expects to regain compliance, the company said it believes that it currently meets the criteria to transfer its common stock listing to the Nasdaq Capital Market.
Isle of Capri Casinos ( ISLE) Company Profile: Isle of Capri Casinos is a developer, owner and operator of branded gaming facilities and related lodging and entertainment facilities in regional markets in the U.S. Current Share Price: $8.98 (May 27) Listing Violation: Board independence. The listing rule requires the board of directors to have a majority of members who are independent. Received Nasdaq Notice: May 18 Management's Expected Action: Isle of Capri says it intends to comply with Nasdaq's majority independent director board composition requirements within the cure period provided by the exchange.
LiveDeal ( LIVE) Company Profile: LiveDeal is a provider of Internet directory, classified and audience acquisition services to small businesses. Current Share Price: $3.78 (May 27) Listing Violation: Market value/equity/net income. Stockholders' equity was less than $2.5 million as of March 31. Received Nasdaq Notice: May 18 Management's Expected Action:>: LiveDeal has until July 5 to submit a plan to regain compliance with the listing rule. The company said it has not made any final decisions regarding what action to take in response.
Suffolk Bancorp ( SUBK) Company Profile: Suffolk Bancorp is a bank holding company for Suffolk County National Bank, which offers an array of products and services to residents of Suffolk County, New York. Current Share Price: $14.44 (May 27) Listing Violation: Delinquent. The company did not file its quarterly report on Form 10-Q for the period ended March 31 in a timely manner. Received Nasdaq Notice: May 18 Management's Expected Action: Earlier this month, Suffolk Bancorp said management identified possible weaknesses in the company's internal controls. Most notably, management found that deficiencies primarily related to the timing of the recognition of credit risk, as well as the computations of the allowance for loan losses. Suffolk Bancorp has 60 days in which either to comply or to file a plan of compliance satisfactory to the Nasdaq, and the company said it is working to either complete its filing or create a plan to regain compliance. Already, shareholder litigation firms are going after Suffolk Bancorp. Robbins Umeda LLP, for example, is investigating whether directors and officers of Suffolk Bancorp harmed shareholders by breaching their fiduciary duties by causing or allowing the company "to issue false and/or misleading financial statements."