Another sign of struggles for Oklahoma City’s Chesapeake Energy Corporation—it’s been warned of being delisted from trading on the New York Stock Exchange.
The company confirmed Friday it received written notice on Dec. 10 from the NYSE of its noncompliance with the standard set forth in a rule of the NYSE Listed Company Manual. The rule requires listed companies to maintain an average closing share price of at least $1 over a consecutive 30 trading-day period.
Chesapeake issued a statement saying it “intends to regain compliance with the NYSE listing standards by pursuing measures that are in the best interests of the Company and its shareholders.”
The measures include executing on its current capital and operating program, which includes a planned 30% reduction in 2020 capital expenditures and ongoing implementation of operating cost efficiencies. Another step will be continued debt reduction through capital market transactions and asset sales.
Chesapeake shares were up a penny at 79 cents following the close of trading on the NYSE.
Chesapeake leaders stated they will consider potential consummation of a potential reverse stock split, subject to shareholder approval at the May 2020 Annual Meeting of Shareholders.
As required by the NYSE, the Company intends to respond to the NYSE within ten business days with respect to its intent to cure the deficiency. The Company has six months following the receipt of the noncompliance notice to cure the deficiency and regain compliance.
During this period, the Company’s common stock will continue trading on the NYSE under its existing ticker symbol, with the addition of a suffix indicating the “below compliance” status of its common stock, as “CHK.BC.”
The notice does not affect the Company’s business operations, or its Securities and Exchange Commission reporting requirements, and does not conflict with or cause an event of default under any of the Company’s material debt agreements.