Coherent announced December 18 that its stock would be delisted December 19th, despite its recent filing of its fiscal year 2006 (FY06) 10-K and plans to file its three remaining 10-Qs in January. Coherent announced that the Securities and Exchange Commission (SEC) has denied the company's motion to stay the decision of the Nasdaq Stock Market LLC to suspend and delist the company's common stock. Therefore, effective at the opening of business on Wednesday, December 19, 2007, the company's common stock was suspended from trading on the Nasdaq Global Market, and will be subsequently delisted.
As previously disclosed by Coherent per a decision dated November 30, 2007, the Nasdaq board of directors gave the company until December 17 to file its past-due periodic reports with the SEC and regain compliance with Nasdaq's listing requirements per Nasdaq Marketplace Rule 4310(c)(14) (see www.laserfocusworld.com/articles/314033). In its decision, the Nasdaq board noted that the company has been out of compliance with Nasdaq Marketplace Rule 4310(c)(14), which requires the timely filing of reports with the SEC for a period of one year from the final due date of the company's annual report on Form 10-K for the fiscal year ended September 30, 2006. On December 11, 2007, the company filed the 2006 10-K with the SEC, which was within one year from when the 2006 10-K was due.
The company continues to work diligently to finalize its remaining delinquent SEC filings and had requested that the Nasdaq board give the company additional time to file its quarterly reports on Form 10-Q for the first three quarters of fiscal 2007 and its annual report on Form 10-K for the fiscal year ended September 30, 2007. The Nasdaq board declined to reconsider its prior decision despite the recent filing of the company's 2006 Form 10-K. The company also petitioned the SEC to stay the Nasdaq board's decision and on December 18, 2007, the SEC notified Coherent that the motion had been denied.
The delay in filing the company's periodic reports arose from the length of time it took to complete the internal investigation by a special committee of Coherent's board of directors into historical stock-option-granting practices and the resulting restatement. The company intends to file its remaining past-due periodic reports as soon as possible and is committed to regaining compliance with all filing requirements. The company has previously announced that it expects to file its delinquent Forms 10-Q no later than January 31, 2008, and expects to file its Form 10-K for the fiscal year ended September 30, 2007 shortly thereafter. This will enable the company to relist shortly after its annual shareholder meeting now scheduled for March 19, 2008.
Coherent anticipates that its common stock will be quoted on the Pink Sheet Electronic Quotation Service automatically and immediately after Nasdaq suspends trading. The company expects that the trading symbol of its common stock will remain the same (COHR). Information about the Pink Sheets can be found at its Internet website www.pinksheets.com
The company has previously issued several press releases and filed several reports with the SEC including reports on Form 8-K, and investors are encouraged to read these in their entirety for discussion of the delay in Coherent's filings at www.coherent.com/investors/.
"We are puzzled at the Nasdaq's hard-line approach and think it makes little sense to delist the stock when the company is on the verge of regaining compliance," says John Harmon, senior financial analyst with Needham & Co, LLC (New York, NY). Although investors have viewed this change negatively, likely driving Coherent's expulsion from the S&P 600 Smallcap Index, the delisting does not change Needham & Co's thesis or valuation of the stock. "Our thesis on Coherent," says Harmon, "is that the company should grow faster than the laser market through its broad and unique product line, while experiencing above-average margins due to the economies of scale from being the world's largest publicly traded laser manufacturer." --Valerie Coffey, senior editor, Laser Focus World magazine.