- The stock price of China XD Plastics Company Limited (Nasdaq: CXDC) fell over 14% pre-market today. This is why it happened.
The stock price of China XD Plastics Company Limited (Nasdaq: CXDC) fell over 14% pre-market today. Investors are responding negatively to China XD Plastics Company Limited announcing that it received a letter from the Listing Qualifications Department of the Nasdaq Stock Market indicating that Nasdaq’s staff has determined to deny the Company’s request for continued listing on Nasdaq.
China XD Plastics plans to request a hearing before a Nasdaq Hearings Panel no later than September 14, 2021, to seek an exception period in which to complete its filings and thereby regain compliance with listing standards. And China XD Plastics’ request for a hearing will automatically suspend the delisting of its common stock for 15 calendar days from the deadline to request a hearing, or until September 29, 2021.
The letter (dated September 7, 2021) stated that the staff has notified the company on April 16, 2021, that it did not comply with Nasdaq’s filing requirements for continued inclusion set forth in Listing Rule 5250(c)(1) since it had not filed its Form 10-K for the fiscal year ended December 31, 2020, and notified the company through subsequent additional delinquency notifications for failing to file its Forms 10-Q for the periods ended March 31, 2021, and June 30, 2021.
China XD Plastics Company submitted materials to Nasdaq relating to its plan to regain compliance. And based on the Staff’s review and the submission, in addition to a telephone discussion on July 26, 2021, the staff has determined that the company did not provide a definitive plan evidencing its ability to achieve compliance with the rule.
If China XD Plastics Company files all of its delinquent reports and regains compliance prior to a hearing before the Nasdaq Hearings Panel, then the company’s common stock would continue trading on Nasdaq. But there can be no assurance that China XD Plastics Company will be able to file its delinquent reports prior to a hearing before the panel or that the panel will grant the company a stay of delisting or additional time to regain compliance.
The hearings are typically held within 30 to 45 calendar days from the date of request. And the Hearings Panel generally issues a written decision approximately 35 days after the hearing. If the Panel’s decision is unfavorable, the company also has the option to appeal the decision to the Nasdaq Listing and Hearing Review Council within 15 calendar days of the Panel’s decision.
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