Sierra Income Corp.’s Manager (MDLY) Reportedly out of Compliance with NYSE’s continued listing standard rules
The White Law Group continues to investigate potential claims involving broker dealers who may have unsuitably recommended high risk Business Development Companies (BDCs) such as Sierra Income Corp. to unsuspecting investors.
According to reports on April 23, 2020, Medley Management Inc. (NYSE: MDLY), the publicly traded manager of Sierra Income Corporation and Medley Capital Corporation (NYSE: MCC), announced that it had received written notice from the New York Stock Exchange that its average market capitalization over a consecutive 30-day trading period was less than $50 million at the same time that its stockholders’ equity is less than $50 million, in addition to is common stock closing price trading below $1.00 per share for 30 consecutive trading days, such infractions if not cured will result in a delisting of the stock from the NYSE.
MDLY reportedly has ten business days to provide a written response to the NYSE regarding its plans to repair these deficiencies. MDLY reportedly has publicly traded notes that are trading at significant discounts to their par value (NYSE: MDLX and NYSE: MDLQ).
MCC has also reportedly received a notice from the New York Stock Exchange that its average daily common stock closing price was below $1.00 per share for 30 consecutive trading days, and was out of compliance with NYSE’s continued listing standard rules. According to reports, MCC notified the NYSE that it intends to cure the non-compliance through a reverse stock split. MCC noted that it will propose a reverse stock split to its stockholders for approval at its 2020 annual meeting. MCC has six months to regain compliance with the minimum share price requirements or it will not be permitted to be listed on the NYSE.
MCC and MDLY are parties to a proposed merger with Sierra Income Corp. first announced in August 2018, and amended in July 2019. According to FactRight, an alternative investment due diligence firm, “there is no indication that the consideration related to the proposed mergers of Sierra Income Corp., MCC and MDLY will be adjusted in light of recent market volatility. MCC shares closed at $2.76 on July 29, 2019 (the date of the amended merger agreement announcement) and closed at $0.59 on April 16, 2020. Similarly, MDLY shares closed at $3.12 on July 29, 2019, and closed at $0.52 on April 23, 2020.”
The White Law Group continues to investigate potential claims involving broker dealers who may have unsuitably recommended high risk Business Development companies (BDCs) such as Sierra Income Corp. to unsuspecting investors. The high commission structure of these products leads to the possibility that unscrupulous financial advisors will push these products unsuitably to maximize their own commissions.
Brokerage firms are required to perform adequate due diligence on any investment they recommend and to ensure that all recommendations are suitable for the investor in light of that particular investor’s age, investment experience, net worth, risk tolerance, investment objectives, and income.
Firms that fail to perform adequate due diligence or that make unsuitable recommendations can be held responsible for investment losses in a FINRA arbitration claim.
Free Consultation with a Securities Attorney
If you suffered losses investing in Sierra Income Corporation or MDLY and would like to discuss your litigation options, please call the securities attorneys of The White Law Group at 888-637-5510 for a free consultation.
The White Law Group, LLC is a national securities fraud, securities arbitration, investor protection, and securities regulation/compliance law firm with offices in Chicago, Illinois and Franklin, Tennessee. The firm represents investors in FINRA arbitration claims throughout the country. For more information on the firm, visit https://www.whitesecuritieslaw.com.
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