Famous Dave’s Falls Out Of Nasdaq Compliance
On the heels of considerable executive turnover at Famous Dave’s of America, the company’s chairman and two board members recently resigned.
And it turns out their departures caused the barbeque chain to fall out of compliance with Nasdaq’s listing requirements.
To be listed on its exchange, Nasdaq requires companies to have an audit committee that includes at least three independent directors. And following the recent departures from Famous Dave’s board, the Minnetonka-based company is left with just two qualifying members of its audit committee, according to a recent regulatory filing.
Nasdaq notified Famous Dave’s last week that it was not in compliance, although the company has been given a “cure period” in which to resolve the issue. Nasdaq rules state that a company must regain compliance by its next annual shareholders meeting, or within a year of falling out of compliance, whichever occurs first.
Famous Dave’s said that the Nasdaq notification has no immediate effect on the listing its stock, and that the company plans to appoint another director and regain compliance within the window of time that Nasdaq allows.
While Nasdaq’s notification is unlikely to have any tangible impact on the company, it’s one more impact from Famous Dave’s unusually frequent leadership turnover, which was recently examined by Twin Cities Business.
Since its 1994 inception, the company has burned through seven different CEOs—which means the average chief executive has lasted less than three years. The company’s most recent CEO turnover came when John Gilbert III resigned after just 16 months in the role. He was recently replaced by Ed Rensi.
But Famous Dave’s leadership turnover has not been limited to chief executives. Earlier this month, Chairman Dean Riesen abruptly resigned after more than a decade on the company’s board of directors. The company did not specify the reason for his abrupt departure, and a successor was not immediately named.
And in May, Famous Dave's replaced its chief financial officer, Diana Purcel, who had held the position since 2003. At the same time, the company said two of its board members were resigning—Richard Monfort and Lisa Kro, who served on the board since 1996 and 2009, respectively.
It was that departure of Monfort and Kro that caused Famous Dave’s to fall out of compliance, triggerin Nasdaq’s notification.