Pinstripes Holdings is being delisted from the New York Stock Exchange just more than one year after it went public in the first place.
The bowling-and-bocce “eatertainment” restaurant chain on Friday said that it would not appeal an effort by the New York Stock Exchange to delist its shares, trading of which had been suspended earlier in the week.
The Northbrook, Illinois-based company had apparently broken a rule requiring companies to maintain a market capitalization of at least $15 million for 30 consecutive days. Pinstripes’ market capitalization was $7.9 million as of Friday.
The company announced the delisting as it announced an agreement with Oaktree Capital Management to provide a $7.5 million loan to enable the company to fund operations. Oaktree had been an existing lender of the company, and as part of a recapitalization of Pinstripes will become majority equity holder.
Oaktree will then elect Pinstripes’ board of directors, and existing stockholders will retain their interest in the company.
The move comes amid mounting problems for the company, which operates 18, mostly large-scale venues ranging from 25,000 to 38,000 square feet. The company’s chief financial officer, Tony Querciagrossa, stepped down last month. And the chain has struggled with weakening sales, including a 7.7% same-store sales decline in the company’s fiscal third quarter ended Jan. 5.
According to a federal securities filing, Pinstripes was not in compliance with various loan covenants, notably the ratio of debt-to-EBITDA, or earnings before interest, taxes, depreciation and amortization. Pinstripes had reached multiple amendments to its loan agreements earlier this year.
The company had $85 million in long-term debt as of Jan. 5, according to regulatory filings. It also had nearly $99 million of operating lease liabilities.
Pinstripes reported an $8 million loss in the company’s third quarter, or 19 cents per share. It reported a loss of $27.4 million in the first three quarters of the fiscal year. The company in September warned of staff cutbacks.
The company’s delisting and sales challenges come as consumers have slowed spending at food-and-games concepts recently. The golf-and-food chain Topgolf is being spun out from its parent company, Topgolf Callaway Brands, and recently laid off workers at corporate headquarters.
Same-store sales at Dave & Buster’s, meanwhile, have fallen seven straight quarters and CEO Chris Morris recently resigned.
Generally speaking, a delisting is a tough step for public companies as it restricts trading, which can make it difficult for them to raise capital from investors. Pinstripes’ delisting, however, was particularly quick: It went public in late 2023 as part of a $70 million merger with the special purpose acquisition company (SPAC) Banyan Acquisition Corp.
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