Delay tactics Companies will often delay what in many cases is an imminent delisting by requesting a hearing before a Nasdaq listing qualifications panel. The request for the hearing is due 90 days from the initial notice and will prevent delisting pending the panel's decision. These hearings are typically scheduled between three and six weeks after the date of the request. A company is permitted to appear before the Nasdaq panel to convince it of a plan to achieve compliance, while in actuality companies often request a hearing merely to postpone delisting and fail to appear for the hearing itself. If the panel is not convinced that a company will regain compliance within a reasonable period of time and be able to sustain compliance over the long term, Nasdaq will delist the company's securities within days of the hearing.
Some companies decide to fight the delisting.
A reverse stock split is the most immediate weapon in a fledgling company's arsenal. The reverse stock split is exactly what its name implies. However, in practice, reverse splits do not always have the desired effect. The problem with reverse splits is that they have a limited track record, are expensive to implement and, unlike regular stock splits, are perceived negatively by investors. Other less drastic, and possibly more effective, methods companies use to fight a delisting include raising additional capital, off-balance sheet financing and buying back shares to boost the stock price.