[COMPANY LOGO]
For Immediate Release: Contact:
December 20, 2005 Dawn M. Robert, Investor Relations
Galaxy Nutritional Foods, Inc.
(407) 854-0433
GALAXY NUTRITIONAL FOODS RECEIVES ACCEPTANCE OF
COMPLIANCE PLAN FROM AMERICAN STOCK EXCHANGE
ORLANDO, Florida (December 20, 2005) Galaxy Nutritional Foods, Inc. (AMEX:GXY)
today announced that on December 16, 2005 the American Stock Exchange ("AMEX")
notified the Company that it accepted the Company's plan to regain compliance
and granted the Company an extension until March 29, 2007 to regain compliance
with the continued listing standards.
As reported in a press release on September 30, 2005, the Company received a
deficiency letter from AMEX on September 29, 2005 advising that, based on a
review of the Company's Quarterly Report on Form 10-Q for the quarter ended June
30, 2005, the Company is not in compliance with AMEX's continued listing
requirements. Specifically, the AMEX notice stated that the Company is not in
compliance with (i) Section 1003(a)(i) of the AMEX Company Guide, because the
Company's shareholders' equity is less than $2,000,000 and it sustained losses
from continuing operations and/or net losses in two out of its three most recent
fiscal years; (ii) Section 1003(a)(ii) of the AMEX Company Guide, because the
Company's shareholders' equity is less than $4,000,000 and it sustained losses
from continuing operations and/or net losses in three out of its four most
recent fiscal years; and (iii) Section 1003(a)(iv) of the AMEX Company Guide,
because the Company has sustained losses which are so substantial in relation to
its overall operations or its existing financial resources, or its financial
condition has become so impaired that it appears questionable, in the opinion of
AMEX, as to whether the Company will be able to continue operations and/or meet
its obligations as they mature.
On October 7, 2005, the Company filed an Amended Annual Report on Form 10-K/A
for the year ended March 31, 2005 and an Amended Quarterly Report on Form 10-Q/A
for the quarter ended June 30, 2005. Based on the revised financial information,
the Company notified AMEX on October 11, 2005 that it is also not in compliance
with Section 1003(a)(iii) of the AMEX Company Guide, because the Company's
shareholders' equity is less than $6,000,000 and it sustained losses from
continuing operations and/or net losses in its five most recent fiscal years.
On October 28, 2005, the Company submitted a plan to AMEX, advising AMEX of
actions that it has taken, or will take, that would bring the Company into
compliance with Section 1003(a)(i), Section 1003(a)(ii), Section 1003(a)(iii),
and Section 1003(a)(iv) of the AMEX Company Guide.
On December 16, 2005, AMEX notified the Company that it accepted the Company's
plan to regain compliance and granted the Company an extension until March 29,
2007 to regain compliance with the continued listing standards. The Company will
continue to be listed during the extension period. The Company will be subject
to periodic review by AMEX during the extension period. If the Company does not
make progress consistent with the plan during the extension period or is not in
compliance with the continued listing standards at the end of the extension
period, AMEX staff may initiate delisting proceedings as appropriate.
1
About Galaxy Nutritional Foods, Inc.
Galaxy Nutritional Foods is the leading producer of health-promoting plant-based
dairy and dairy-related alternatives for the retail and foodservice markets. An
exclusive, new and technologically advanced, safer "hot process" is used to
produce these phytonutrient-enriched products, made from nature's best grains -
soy, rice and oats. Veggie products are low fat and fat free (saturated fat and
trans-fatty acid free), cholesterol and lactose free, are growth hormone and
antibiotic free, and have more calcium, vitamins and other minerals than
conventional dairy products. Because they are made with plant proteins, the
products are more environmentally friendly and economically efficient than dairy
products derived solely from animal proteins. Galaxy's products are part of the
healthy and natural foods category, the fastest growing segment of the retail
food market. Galaxy brand names include: Galaxy Nutritional Foods; Veggie;
Veggie Nature's Alternative; Veggie Slices; Soyco; Soymage; Wholesome Valley;
Lite Bakery; and Galaxy Nutritional Foods Smart Choice Cheese Products. For more
information, please visit Galaxy's website at: www.galaxyfoods.com.
Galaxy Nutritional Foods, Inc. is headquartered in Orlando, Florida, and its
common stock is listed on the American Stock Exchange under the ticker symbol
"GXY".
THIS PRESS RELEASE CONTAINS "FORWARD-LOOKING" STATEMENTS WITHIN THE MEANING OF
THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995. SUCH FORWARD-LOOKING
STATEMENTS INVOLVE KNOWN AND UNKNOWN RISKS, UNCERTAINTIES, OR OTHER FACTORS
WHICH MAY CAUSE ACTUAL RESULTS, PERFORMANCE OR ACHIEVEMENTS OF THE COMPANY TO BE
MATERIALLY DIFFERENT FROM ANY FUTURE RESULTS, PERFORMANCE OR ACHIEVEMENTS
EXPRESSED OR IMPLIED BY SUCH FORWARD-LOOKING STATEMENTS. READERS ARE CAUTIONED
NOT TO PLACE UNDUE RELIANCE ON THOSE FORWARD-LOOKING STATEMENTS, WHICH SPEAK
ONLY AS OF THE DATE HEREOF. THE COMPANY UNDERTAKES NO OBLIGATION TO PUBLICLY
RELEASE ANY REVISIONS TO THESE FORWARD-LOOKING STATEMENTS TO REFLECT EVENTS OR
CIRCUMSTANCES AFTER THE DATE HEREOF OR TO REFLECT UNANTICIPATED EVENTS OR
DEVELOPMENTS.
2