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Subsequent Events
3 Months Ended
Mar. 31, 2020
Subsequent Events [Abstract]  
Subsequent Events

21. Subsequent Events

 

On April 13, 2020, the Company, received a letter from the Listing Qualifications Department of The Nasdaq Stock Market, LLC (“Nasdaq”) notifying the Company that the Staff of Nasdaq has determined that the minimum market value of its publicly held common stock (the “Market Value of Publicly Held Shares”) fell below $15,000,000 for a period of 30 consecutive business days (from February 24, 2020 through April 9, 2020) and that, therefore, the Company did not meet the minimum market value of publicly held shares requirement set forth in Nasdaq Listing Rule 5450(b)(2)(c) (the “Minimum Market Value Rule”). The letter also states that pursuant to Nasdaq Listing Rule 5810(c)(3)(D), the Company will be provided 180 calendar days to regain compliance with the Minimum Market Value Rule, which period expires October 12, 2020. In accordance with Rule 5810(c)(3)(D), the Company can regain compliance with the Minimum Market Value Rule, if, at any time during such 180-day period, the Market Value of Publicly Held Shares of the Company’s common stock is at least $15,000,000 for a minimum period of 10 consecutive business days. If the Company does not regain compliance within the allotted compliance period, including any extensions that may be granted by Nasdaq, Nasdaq will provide notice that the Company’s shares of common stock will be subject to delisting. At such time, the Company may appeal the delisting. At such time, the Company may appeal the delisting determination to a Hearings Panel.

 

On April 16, 2020, Nasdaq approved relief for certain filers with respect to the Minimum Market Value Rule. As a result, the Company has until December 24, 2020, to regain compliance with the Minimum Market Value Rule.

 

On April 23, 2020, the Company, received a letter from Nasdaq notifying the Company that the minimum bid price per share for its common stock fell below $1.00 for a period of 30 consecutive business days (from March 11, 2020 through April 22, 2020) and therefore the Company did not meet the minimum bid price requirement set forth in the Nasdaq Listing Rules. The letter also states that pursuant to Nasdaq Listing Rule 5810(c)(3)(A), the Company will be provided 180 calendar days to regain compliance with the minimum bid price requirement, and further notes that the Nasdaq has determined to toll compliance periods for the minimum bid price rule through June 30, 2020, extending the 180 calendar day compliance period to December 28, 2020. In accordance with Rule 5810(c)(3)(A), the Company can regain compliance with the minimum bid price requirement, if, at any time during such 180-day period, the closing bid price of the Company’s common stock is at least $1.00 for a minimum period of 10 consecutive business days. The Company intends to monitor the market value of its publicly held common stock between now and December 24, 2020 and its closing bid price for its common stock between now and December 28, 2020, and will consider available options to resolve the Company’s noncompliance with the minimum bid price requirement or the Minimum Market Value, as may be necessary. There can be no assurance that the Company will be able to regain compliance with the minimum bid price requirement or the Minimum Market Value will otherwise or be in compliance with other Nasdaq listing criteria.

 

On April 13, 2020, the Company received loan proceeds in the amount of approximately $1.3 million, under the Paycheck Protection Program ("PPP").  The PPP, established as part of the CARES Act, provides for loans to qualifying businesses for amounts up to 2.5 times of the average monthly payroll expenses of the qualifying business. The PPP loan is payable over two years at an interest rate of 1%, with a deferral of payments for the first six months.  The Company intends to use the proceeds for purposes consistent with the PPP.

 

On April 24, 2020, the Company, and its indirect wholly-owned subsidiary, Iconix Luxembourg Holdings S.à r.l. (“Iconix Luxembourg”), entered into a share purchase agreement (the “SPA”) with HK Qiaodan Investment Limited to sell all of the Company’s equity interests of Umbro China, Limited, a wholly-owned subsidiary of Iconix Luxembourg , to HK Qiaodan International Limited (the “Umbro China Sale”), for consideration of approximately $62.5 million. The Umbro China Sale includes the sale of the Umbro sports brand in the People’s Republic of China, Hong Kong, Taiwan and Macau. The Umbro China Sale is anticipated to close on or prior to September 15, 2020, subject to the satisfaction or waiver of customary closing conditions. The sale agreement contains representations, warranties, and covenants of the parties that are customary for transactions of this type. The Company anticipates using the net proceeds from the Umbro China Sale to repay amounts due under its existing financing arrangements, and otherwise for general corporate purposes.