When is the compliance deadline and what are the potential consequences, such as delisting, if the deadline is missed?
Compliance deadline
ScanTech AI disclosed that it received a Nasdaq deficiency letter on August 29, 2025. Under Nasdaq’s standard procedures, a company that is out of compliance with a listing requirement is given 45 calendar days to cure the deficiency (or a longer period if Nasdaq grants an extension). Accordingly, the firm must satisfy the cited requirement by roughly October 13‑15, 2025 (the exact date will be spelled out in the letter).
Potential consequences of a missed deadline
If ScanTech AI does not remediate the issue by the deadline, Nasdaq will proceed with its delisting protocol:
- Trading suspension – Nasdaq will halt trading of STAI’s shares pending a final decision, creating a sharp, short‑term liquidity crunch.
- Formal delisting notice – The stock will receive a “deficiency notice” on the exchange’s website and may be moved to the over‑the‑counter (OTC) market, where price volatility and bid‑ask spreads are typically wider.
- Potential loss of investor confidence – A delisting event often triggers a rapid price decline (often 20‑30% or more) as institutional investors are forced to sell, and the company may face higher cost of capital.
Trading implication
The market is likely to price in a “risk‑of‑delisting” premium already, evident in the negative sentiment and potential discount to peer valuations. Short‑term traders may consider a cautious short position or a protective put if the stock is still liquid, while long‑term investors should wait for a clear cure (e.g., a capital raise, share‑count adjustment, or a compliance filing) before re‑entering. Monitoring any Nasdaq extension request, a filing with the SEC, or a press release confirming compliance before the mid‑October deadline will be crucial for positioning. If the deadline is met, the stock could rebound modestly, but a miss would likely trigger a steep sell‑off and eventual migration to the OTC market.