Tel-Instrument Electronics announces receipt of NYSE American non-compliance letter regarding minimum equity requirement

victoria@aviationnews-online.com
By victoria@aviationnews-online.com August 15, 2018 11:24

Tel-Instrument Electronics announces receipt of NYSE American non-compliance letter regarding minimum equity requirement

Tel Instrument Electronics, which designs and manufactures avionics test and measurement solutions, announced that on August 8, 2018 it received a letter from the staff of the NYSE American (exchange) stating based on the company’s financial statements at March 31, 2018, that the company is not in compliance with Section 1003(a)(ii) of the NYSE American Company Guide, which requires that a company’s stockholders’ equity be $4.0 million or more if it has reported net losses in three of its last four fiscal years.

As of March 31, 2018, the company had a stockholders’ deficit of approximately $1.4 million, and had net losses in three of its last four fiscal years, thus bringing the Company below the Stockholders’ Equity Requirement. The decline in equity primarily resulted from the accrual of approximately $5 million in damages arising from the Aeroflex litigation as well as over $2 million in litigation costs over the years. The company also had to record a valuation allowance of approximately $3.5 million against its deferred tax asset.

The company is preparing a plan that will be submitted to the exchange, describing the actions it is considering taking to regain compliance with the Stockholders’ Equity Requirement. The company has also been advised that it will be subject to delisting proceedings if it does not regain compliance prior to the deadline of January 29, 2019, or if the exchange determines that company is not making progress consistent with the plan.

The company’s stock will continue to be listed on the NYSE American while it evaluates it various alternatives. The company’s receipt of such notification from the Exchange does not affect its business, operations or reporting requirements with the U.S. Securities and Exchange Commission.

victoria@aviationnews-online.com
By victoria@aviationnews-online.com August 15, 2018 11:24