Jerry’s Famous Deli Inc. (Nasdaq:DELI) today announced that it had received a letter from the Nasdaq Stock Market Inc. on Oct. 1,
2001, advising the company that its stock would be delisted from the Nasdaq SmallCap Market at
the opening of business on Oct. 10, 2001, for failure to meet public float requirements and failure to
have a sufficient number of independent directors to serve on the audit committee.
As was anticipated and disclosed in Offer to Purchase related to the recent tender offer, as a result
of the tender offer the company no longer meets the public float requirement for continued listing
pursuant to the Nasdaq Marketplace Rules. In addition, in anticipation of delisting for delisting
pursuant to the float requirement, the company had not solicited a new board member to add to the
audit committee as required by the rules.
Following the delisting of the company’s common stock from the Nasdaq SmallCap Market, the
company may remain eligible for trading on the Nasdaq OTC Bulletin Board (OTCBB). However, no
assurance can be given that the company will remain eligible to trade on the OTCBB or that market
makers will quote the company’s stock on the OTCBB.
In order to remain eligible for trading on the OTCBB, the company will be required to maintain the
registration of its common stock under the Securities Exchange Act of 1934, and to file the quarterly,
annual and other reports required under that act on a timely basis. The company’s board of
directors has not determined if or when the company will stop reporting and deregister the
company’s common stock under the act, thereby making the common stock ineligible for trading on
the OTCBB. The company cannot assure that, even if it remains eligible for trading on the OTCBB,
there will be an active market for its common stock. Because of the substantial reduction in the
number of shares in the hands of public holders of the common stock as a result of the tender
offer, the company anticipates that future trading in the common stock will be substantially reduced.
As described in the Offer to Purchase related to the tender offer, the company may at some time in
the future complete a merger in which all shareholders except the control shareholders would
receive cash for their common stock. Since the control shareholders now own more than 90
percent of the outstanding common stock, such a merger could be completed at any time without a
vote of the public shareholders. To the company’s knowledge, no decision has been definitively
made at this time by the control shareholders about whether or when to complete such a merger