Fusion Connect, which could be heading into chapter 11 bankruptcy, has been notified that its stock could be delisted from the Nasdaq because it hasn’t paid required fees.
Earlier this month, Fusion, the cloud communications provider that sells through partners, revealed it had failed to make $7 million in loan payments and had not filed its annual report on time. The company’s 8-K filing disclosed the default and annual report filing delay.
Fusion said nonpayment of the installments constitutes an “immediate event of default” under its credit agreement. It also said it has been informed by some lenders that they intend to declare all amounts borrowed to be immediately due and payable.
Fusion said it has decided that it is not in its best interest to challenge Nasdaq’s determination and anticipates, as indicated in Nasdaq’s letter, that the company’s common stock will be delisted from the Nasdaq market and suspended effective at the opening of business on April 25.
Fusion wouldn’t provide any further comment regarding its status. The company’s stock was down nearly 24 percent on Monday trading.
Following the delisting, Fusion anticipates its common stock will be eligible to be quoted on the over-the-counter (OTC) market, but no assurance can be made that trading on the OTC will commence or be maintained.
The OTC is a significantly more limited market than the Nasdaq, and the transition to OTC is likely to result in there being a “less liquid market” available for existing and potential shareholders, and could further depress the stock’s trading price, according to Fusion.
Fusion also is facing class-action lawsuits filed on behalf of its investors.
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January 14 2020 @ 22:15:00 UTC