iMedia moves to lower-tier Nasdaq Capital Market while trying to raise minimum bid

Eden Prairie-based iMedia Brands, the parent company of shopping network ShopHQ and retailer Christopher & Banks, has downgraded from the Nasdaq Global Market to the Nasdaq Capital Market.

Effective Monday, the listing of its common stock transferred to the Nasdaq Capital Market, the market with the least-stringent financial requirements of Nasdaq's three offerings. The Nasdaq Capital Market is normally reserved for smaller companies that are looking to raise additional capital.

Last October, Nasdaq informed iMedia it had fallen out of compliance with the minimum $1 bid price requirement and was in danger of delisting. Leaders at iMedia had until April 12 to regain compliance or apply for a 180-day extension.

"Nasdaq has a couple of different markets you can list or trade on, so it doesn't make a difference to investors if they trade on either one," said Mark Argento, founding partner and analyst at Minneapolis investment bank Lake Street Capital Markets. "The biggest thing is it gives them another 180 days to get the stock above a $1."

In order to regain compliance, the minimum bid price must be at least $1 for at least 10 consecutive business days. The company's common stock will continue to trade under the symbol IMBI.

Per a recent filing with the Securities and Exchange Commission, iMedia chief executive Tim Peterman said the company applied to transfer its listing to the lower-tier market in anticipation of not regaining compliance by the end of the 180-day grace period.

"We are now being afforded an additional 180-day grace period, or until October 9, 2023, to regain compliance with the Nasdaq's minimum bid price requirement," Peterman wrote. "We have provided written notice of our intention to cure the minimum bid price deficiency during the second grace period by effecting a reverse stock split if necessary."

In 2019, iMedia did a 10-for-1 reverse stock split to raise the company share price and avoid delisting.

A spokesman for iMedia said the company's focus is to raise the stock price above $1. Company leaders will assess which market to keep its listing in once that's accomplished.

iMedia has had to be creative to remain financially viable in recent years. After it fell out of compliance with its major lender late last year, iMedia completed the sale and leaseback of several of its properties — including its headquarters — to raise capital. The company ended up postponing its earnings report three times to give it more time to finish the sales.

For fiscal year 2022, iMedia reported a $70 million loss.