Impac addressing one stock listing violation but it now faces another

Impac Mortgage Holdings’ plan to regain compliance to keep its stock listed was accepted by the NYSE American exchange, but the same letter reported a second violation, the company said.

The NYSE American stock exchange has accepted Impac Mortgage Holdings’ plan to regain the compliance it needs to keep its shares listed, but also is now warning a second violation exists.

The letter notified Impac of another violation of the exchange’s standards for shareholder equity.

Impac is required to have $2 million of stockholder equity if it has sustained losses from continuing operations and/or net losses in two of its three most recent fiscal years. The company has five consecutive years of net losses, although it also has reported some profitable quarters, including the third and fourth quarters of 2021.

And in the third quarter of this year, Impac lost $13 million, after losses of $13.5 million in the second quarter and $1.2 million in the first quarter. That makes it likely the company will end this year with a net loss. 

As of Sept. 30, the company reported a stockholder deficit of $6.1 million.

 “No further plan submission or amendment to the submitted plan is required in connection with the new deficiency notice,” Impac’s press release said.

In August, Impac disclosed it received a notice from the NYSE American exchange — a marketplace for publicly traded small cap companies — that it violated its listing rules because of its continued fiscal losses.

Specifically, Impac was cited as being out of compliance since it failed to maintain required levels of shareholder equity and has lost money five years in a row.

On Nov. 15, the NYSE American sent a letter to Impac stating the plan had been accepted and the company has until Feb. 26, 2024 to regain compliance with the listing standards.

Meanwhile, also on Nov. 15, Impac announced it completed the exchange of its Series B and Series C preferred stock, resolving a legacy issue for the company.

Each holder of Series B stock received 30 shares of the new 8.25% Series D Cumulative Redeemable Preferred Stock and 13.33 shares common stock.

The Series C stock was exchanged for one share of the Series D stock, 1.25 shares of common stock and 1.5 warrants to purchase an equal amount of common stock at $5 per share.

On Nov. 17, Impac opened at 36.5 cents per share; its 52 week range is between 24 cents a share and $1.35 per share, according to Yahoo Finance.