Clover Leaf Capital Corp., an amusement and recreation services company, is set to be delisted from The Nasdaq Stock Market LLC following a notice from Nasdaq's Hearings Panel. The company received the notice on Monday, August 30, 2024, indicating the decision to delist Clover Leaf's securities due to its failure to meet the terms of a previous decision dated June 5, 2024. Trading of Clover Leaf's securities will be suspended starting Wednesday, September 4, 2024.
The June decision required Clover Leaf to complete an initial business combination with Kustom Entertainment, Inc. and demonstrate compliance with Nasdaq's initial listing criteria by August 28, 2024.
However, Clover Leaf informed the Panel on August 27, 2024, that it would not meet this deadline. Consequently, the Panel opted to proceed with the delisting.
In response to the impending delisting, Clover Leaf's units, Class A common stock, and rights are expected to trade on the OTC Markets under the tickers "CLOEU," "CLOE," and "CLOER," respectively.
Nasdaq will formalize the delisting process by submitting a Form 25 with the Securities and Exchange Commission after the review and appeal periods have concluded.
Clover Leaf and Kustom Entertainment are actively working to complete the business combination before the expiration of the appeal period in hopes of reinstating trading on Nasdaq as soon as possible.
The company has already filed a Proxy/Registration Statement with the SEC, which includes a definitive proxy statement for Clover Leaf's stockholders regarding the business combination and a prospectus for Kustom Entertainment's stockholder.
The definitive proxy statement has been mailed to Clover Leaf's stockholders, urging them to read it and other related documents filed with the SEC carefully.
This news comes amid a challenging period for Clover Leaf, which is navigating regulatory requirements and striving to fulfill its business combination obligations. The company's future steps involve addressing the conditions for the business combination's closure and managing the transition to OTC trading while maintaining its focus on completing the transaction with Kustom Entertainment.
In other recent news, Clover Leaf Capital Corp. has made a series of strategic moves to secure its financial future and maintain its Nasdaq listing. The company has rescheduled a stockholder meeting to vote on a merger with Kustom Entertainment, a subsidiary of Digital Ally (NASDAQ:DGLY). The merger aims to bring together Kustom Entertainment's portfolio, including TicketSmarter, Kustom 440, and BirdVu Jets, under Clover Leaf's umbrella.
Simultaneously, Clover Leaf has been granted a conditional extension by Nasdaq, contingent on the successful completion of the merger with Kustom Entertainment. To support these plans, Clover Leaf has extended its initial business combination deadline and adjusted its financial obligations, including issuing a promissory note to Yntegra Capital Investments and committing to deposit monthly funds into a trust account.
Additionally, Clover Leaf has amended its merger agreement with Kustom Entertainment, extending the deadline and revising the terms of their Lock-Up Agreement with Digital Ally, Kustom Entertainment's sole stockholder.
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