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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
April 21, 1999
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(Date of earliest event reported)
Frederick Brewing Co.
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(Exact name of registrant as specified in its charter)
Maryland 0-27800 52-1769647
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(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification No.)
4607 Wedgewood Blvd., Frederick, Maryland 10119-0002
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(Address of principal executive offices) (Zip Code)
(301) 694-7899
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(Registrant's telephone number, including area code)
Not Applicable
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(Former name, former address and former fiscal year, if changed since last
report)
Page 1 of 3 Pages
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ITEM 5. Other Events
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On September 17, 1998, the Company received a letter from The Nasdaq Stock
Market, Inc. ("Nasdaq"), dated September 15, 1998, in which Nasdaq notified the
Company that its common stock, present par value $0.0004 per share (the "Common
Stock") had failed to maintain a closing bid price greater than or equal to
$1.00 per share. Under the Nasdaq's Marketplace Rules governing qualitative and
quantitative standards for listing on the SmallCap Market, a minimum bid price
of $1.00 per share is required. The Company was notified that the Common Stock
would be subject to delisting if the Company is unable to meet the minimum bid
price requirement. The Company was given until December 14, 1998 to regain
compliance with the minimum bid requirement--which could have been satisfied if
the shares of Common Stock reported a closing bid price of $1.00 or greater for
ten consecutive trading days.
The Company was unable to comply with the minimum bid requirement since
receiving the September 15, 1998 letter from the Nasdaq and requested a hearing
on the matter, which temporarily stayed the delisting process. The hearing with
the Nasdaq was held February 19, 1999, at which time the Company requested an
extension to meet the minimum bid price requirement after its one-for-ten
reverse stock split became effective. On March 23, 1999, the Company
effected the reverse stock split, which caused the closing bid price to rise
to $1.1875 per share the following day. The Common Stock's closing bid price
remained at or above $1.00 per share for the following seven consecutive days;
however, since April 5, 1999 the closing bid price has remained below the
$1.00 per share minimum requirement for continued listing on the NASDAQ
SmallCap Market. On Apri1 21, 1999, the closing bid price of the Company's
Common Stock was $0.50.
On Apri1 21, 1999, the Company received a letter, through its counsel,
notifying it that the NASDAQ Listing Qualifications Panel determined to delist
the Company's Common Stock from the NASDAQ SmallCap Market effective with the
close of business Apri1 21, 1999. Such delisting may have an adverse impact on
the liquidity of the Common Stock.
With the delisting, trading in the Common Stock will be conducted on the
OTC Bulletin Board or the over-the-counter market. Because spreads between the
"bid" and "asked" prices of the shares of Common Stock quoted by market makers
on the OTC Bulletin Board and the over-the-counter market will likely be greater
than it is at present, Stockholders will likely experience a greater degree of
difficulty in trading of shares of Common Stock. In addition, there are
significant restrictions imposed by most brokerage houses on the ability of
their brokers to solicit orders or recommend the purchase of stocks that
trade on the OTC Bulletin Board.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
FREDERICK BREWING CO.
Date: April 22, 1999 By: /s/ Kevin E. Brannon
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Kevin E. Brannon
Chairman and Chief Executive Officer
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