Business Context and Reporting Period
Company: Educational Development Corporation
Filing Type: Form 8-K (Current Report)
Date of Report: June 27, 2012
Event Date: June 22, 2012 (Notice received); May 21, 2012 (Earliest event reported)
The Company received a notification from the Nasdaq Stock Market regarding noncompliance with listing rules due to the resignation of a director.
Key Financial Metrics
This filing is a current report regarding corporate governance and listing status. It does not contain financial statements, revenue, profit, cash flow, margin, debt, or liquidity data.
Material Changes
- Board Composition: The resignation of James Lewis from the Board of Directors (reported May 24, 2012) resulted in the Board no longer having a majority of Independent Directors.
- Listing Compliance: The Company failed to meet Nasdaq Listing Rule Section 5605, which requires a majority of independent directors and an audit committee with at least three independent members.
Outlook, Risks, and Management Commentary
- Cure Period: The Company has been granted a six-month period to regain compliance with Nasdaq listing requirements.
- Management Action: The Board is currently considering candidates and intends to appoint an independent director to fill the vacancy on the Board and the Audit Committee as soon as possible.
- Trading Status: The notification of noncompliance has no immediate effect on the listing or trading of the Company's common stock on the Nasdaq Capital Market.
Investor Verification Checklist
- Verify the appointment of a new independent director to the Board and Audit Committee within the six-month cure period.
- Monitor future 8-K filings for confirmation of regained compliance with Nasdaq Listing Rule Section 5605.
- Review the May 24, 2012 Form 8-K for details regarding the resignation of James Lewis.