CannTrust Holdings Inc
(NYSE:CTST) released a status update on Thursday in line with the
requirement for a Management Cease Trade Orders (“NP 12-203”) as per
the National Policy 12-203.
The MCTO makes it compulsory for the firm to release updates
twice every week until it is up to date with its filing obligations
requirements of the Canadian securities laws. The Ontario Securities Commission
issued the MCTO which also prohibits CannTrust’s executive officers and
directors from acquiring the company’s securities or trading them.
This prohibition will remain active and will only be lifted
two business days after CannTrust files an interim financial report for the
quarterly and half-year period ended June 30, 2019. The company’s investors who
are not insiders will not be affected by the MCTO. CannTrust has also expressed
its commitment to comply with the NP 12-203 guidelines.
Will the company get
delisted from the New York Stock Exchange?
CannTrust might be at risk of delisting by the New York
Stock Exchange due to its illegal growing activities. The Canadian firm
targeted the U.S due to the huge market potential at a time when cannabis was
gaining legal status. There were a lot of positive expectations about the
company but things have been going downhill ever since it announced that it had
been illegally growing cannabis in 5 unlicensed rooms for five months.
The confession came after a review by Health Canada, a
Canadian regulatory authority. The company had been conducting the illegal
growth at the unlicensed rooms from October 2018 to March 2019. It was awarded
a license for the rooms in April this year but the impact of the illegal growth
started haunting the company. Health Canada placed 5,000 kilos of the company’s
product on hold, and so it could not sell its products while investigations
were being conducted.
The situation led to distrust especially by investors and CannTrust
stock has been on the decline. The NYSE requires firms to maintain a $1 minimum
share price to avoid delisting. CannTrust’s stock closed Friday’s trading
session at $1.20 and if it goes below the $1 mark, then it might end up being
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Published at Wed, 02 Oct 2019 12:31:49 +0000