From time to time, we receive questions through various channels regarding our action, strategy and the Company. We take this opportunity to address your most frequent concerns. We know there is a hard-fast rule by the NYSE that if a stock trades below $0.16, it has the right to immediately move to delist that security from the NYSE and move it to an OTC market. We suspect that this is why the stock is halted.
Does the listing status of LKM impact your litigation?
No. Our action can proceed whether LKM is listed on the NYSE, OTC or even unlisted. We are seeking return and recovery of LKM assets and the restoration of proper Board governance on behalf of shareholders who are the true owners of LKM. This is independent of the status or value of Company shares. If anything a delisting from the premier Exchange in the world, the NYSE, further demonstrates the Board’s incompetence in managing the affairs of the Company. In that respect, delisting further bolsters our claims against the Company.
Does the resignation of Co-Chairman Larry Chi impact your litigation strategy?
No. As those of you who have followed LKMForward know, we have reached out to the Board on multiple occasions requesting and demanded the Board fulfills its fiduciary duties to all shareholders. We also furnished the Board with two vehicles through which this could be accomplished: the requisition and our agenda for the annual meeting. To date, the company ignored the requisition and has not scheduled an annual meeting. It became apparent that neither Co-Chairman Mr. Chi nor the remainder of the Board could or would resolve this at the Board level. Therefore, we commenced our TRO/Receivership action to bypass the Board. While we would still welcome immediate Board resolution or all issues mentioned in our TRO, in view of our past experience with the Board, we have a vehicle in our complaint that does not rely on any Board action.
What is the status of the complaint?
Yesterday, counsel completed a briefing schedule for our action. Once briefs are filed in mid-January, the Judge will then schedule oral arguments of our complaint requesting the issue a permanent injunction and appointment of a receiver for the Company. Depending on the Judge’s calendar, we would hope to have a final ruling late January or early February, 2019. While 45 days may seem long in view of current Company turmoil, from a legal perspective, this is an extremely quick resolution to this matter.
Is the temporary restraining order still in place?
Yes. The opposing party agreed to the extension of the TRO for the remainder of the briefing and hearing schedule. As such, anyone who violates that order, during this period, does so at their own legal peril.