Nasdaq Delists Koo Koo Roo Over Trading Price

Koo Koo Roo Enterprises Inc., said Monday it is being delisted by Nasdaq for not meeting one of the market’s minimum requirements.

The Irvine-based company’s shares will begin trading today in the lower-profile over-the-counter market.

Koo Koo Roo, which operates several restaurant chains, said it failed to meet the $5 minimum trading price required of new companies.

While Koo Koo Roo Inc. shares traded for more than six years on Nasdaq, it became part of a new company--Koo Koo Roo Enterprises--when it was purchased last year by privately owned Family Restaurants Inc., parent of the El Torito Mexican food chain.

During the merger negotiations, the company was granted a waiver from Nasdaq, essentially exempting it from the $5 requirement. But the waiver was rescinded after being considered by another Nasdaq panel.

In fact, the company was also failing to meet another standard--a minimum trading price of $1 a share--that Nasdaq established last year, one of a number of new restrictions. Delistings have more than doubled since the new restrictions took effect.

Trading in Koo Koo Roo shares was halted early Monday. At the time, the stock was trading at 59 cents, down 25 cents a share, from Friday’s closing price.

“We raised the bar,” Nasdaq spokesman Scott Peterson said Monday. “This is one way we’re attempting to protect shareholders.”

Koo Koo Roo said it was warned in December that it would also have to meet the $1 requirement. Nasdaq officials gave the company until March 31 to boost its share price to at least $1 for 10 consecutive trading days to avoid delisting, the company said.

Koo Koo Roo said it was putting together a plan to meet that standard when it learned Friday that a Nasdaq panel had overturned the earlier waiver.

“It’s a disappointment,” said Robert L. Carl, vice president of investor relations. “It becomes a minor impediment for our shareholders to conveniently trade shares.”