China Auto Logistics Says it Will Vigorously Oppose "Grossly Unfair and Damaging" Plan by Depository Trust Company to Impose ...
23 Juillet 2014 - 11:39PM
Company Says it Aims to Protect
Shareholders From Being Punished by a Decision Said to be Based on
Recent SEC Enforcement Actions Against "Outsiders" Accused of
Illegal Trading, While the Company Itself Has Not Been Accused of
Any Wrongdoing
Chairman Asks, "Is This Really Because We
Are a China Based Company?"
China Auto Logistics Inc. (the "Company" or
"CALI") (Nasdaq:CALI), a top seller in China of luxury imported
automobiles, a leading provider of auto-related services and a soon
to be entrant in used car sales in China, today said it will
vigorously oppose a "grossly unfair and highly damaging" plan by
the Depository Trust Corporation, ("DTC"), as detailed in a
notification letter received by the Company from DTC on July 17,
2014, to suspend all book entry services provided to DTC
participants with respect to CALI shares (the "Global Lock"). The
letter indicated the Company has until August 13, 2014 to provide a
written response stating its objections to the DTC action, after
which DTC will make either a determination or a request for further
information within 20 business days.
According to the Company, the DTC decision to impose a "Global
Lock" affecting all current shareholders is not based on any
wrongdoing by the Company and there have been no allegations made
against it. Rather, it is said to be based on DTC becoming aware of
a recent SEC enforcement action against S. Paul Kelley et. al., in
which the SEC alleges that Kelley et. al., among other offenses,
violated Section 5 of the Securities Act. DTC's concern is that
certain deposits made by Kelley et. al. were in violation of DTC's
eligibility standards, and were comingled with shares of CALI
eligible for deposit.
Striving To Maintain U.S. Listing
"It is patently unfair," stated Mr. Tong Shiping, Chairman and
CEO of China Auto Logistics, "that our current shareholders should
be made to bear the brunt of the SEC enforcement action for past
actions of a group of allegedly unscrupulous individuals. Nor
should our China-based company be so severely punished after years
of willing compliance with all applicable U.S. regulations, and
shares that have been listed on NASDAQ since January 2010."
"We are fully aware," he continued, "that perhaps a
disproportionate number of China-based companies that came public
in the U.S. in recent years have been accused of, and in some cases
found guilty of serious improprieties, while other simply have been
chased away after the harshest imaginable treatment by the media
and some very aggressive short sellers. Our Company, however,
nevertheless has strived to maintain its U.S. listing, and
communicates openly and regularly with our shareholders with the
hope that their patience ultimately will be rewarded by the bright
future we still see ahead in an improving economic
environment."
"Quite simply," Mr. Tong continued, "we see DTC's action as a
matter of throwing out the baby with the bathwater, and I have to
ask, is this really based on our being a China-based company more
than anything else?"
"We are quite determined to fight this tooth and nail," Mr. Tong
said, "and will update shareholders when we have more
information."
About China Auto Logistics Inc.
China Auto Logistics Inc. is one of China's top sellers of
imported luxury vehicles. It also provides a growing variety of
"one stop" automobile related services such as short term dealer
financing. Additionally, in November, 2013, it acquired the
owner and operator of the 26,000 square meter Airport International
Automall in Tianjin for $91.4 million, with plans to develop it,
among other things, as the flagship site for a used car business,
with Car King (China) Used Car Trading Co., Ltd.
Information Regarding Forward-Looking
Statements
Except for historical information contained herein, the
statements in this press release are forward-looking statements
that are made pursuant to the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995. Forward-looking
statements involve known and unknown risks and uncertainties, which
may cause our actual results in future periods to differ materially
from forecasted results. These risks and uncertainties include,
among other things, product demand, market competition, and risks
inherent in our operations. These and other risks are described in
our filings with the U.S. Securities and Exchange Commission.
CONTACT: Sun Jiazhen
sjz_cali@126.com
Ken Donenfeld
DGI Investor Relations Inc.
kdonenfeld@dgiir.com
Tel: 212-425-5700
Fax: 646-381-9727
China Auto Logistics Inc. (delisted) (NASDAQ:CALI)
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