Fresh Vine Wine Inc. is out of compliance with New York Stock Exchange listing requirements, the Minnetonka company said in a federal filing Thursday.
The company also officially ended licensing agreements with actors Nina Dobrev and Julianne Hough, who have been the focus of the company's marketing efforts. Dobrev and Hough had both sent letters to the company in August saying Fresh Vine was in default of its agreement and had failed to pay licensing fees.
Fresh Vine's latest filing with the Securities and Exchange Commission indicated it had not paid those fees, ending the agreements.
Dobrev and Hough promoted Fresh Vine through their social media accounts and "are considered by many to be the face of our brand," the company said in the filing.
The celebrities are shareholders as well. The company's proxy statement filed last October indicates that Dobrev owned 11.4% of the company and Hough had a 9.5% stake.
The split with Dobrev and Hough calls for an overhaul of Fresh Vine's marketing.
"We will be required to refocus our marketing and brand promotion efforts, which may adversely affect our business and results of operations," said the company in its SEC filing.
The maker of low-carb, low-calorie wines said last month that the company is exploring strategic alternatives that could include the sale of the company, which is grappling with declining sales and executive turnover.
On Sept. 8, Fresh Vine received notification from the NYSE that it was at risk of being delisted. Under the listing rules, the company must have $4 million in shareholders' equity. As of June 30, Fresh Vine reported shareholders' equity of $2.4 million.
The company must submit a plan outlining how it intends to regain compliance by March 8. Its shares closed Thursday at 39 cents, down more than 6%.
