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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?"
TIANJIN, China, July 23, 2014 (GLOBE NEWSWIRE) --
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."