Major exchanges, such as NASDAQ, are exclusive clubs: their reputation depends on the companies they operate with. As such, NASDAQ will not ...
Major exchanges, such as NASDAQ, are exclusive clubs: their reputation depends on the companies they operate with. As such, NASDAQ will not only allow any company to be listed on the stock exchange. Only companies with a solid history and first-class management are considered behind them.
NASDAQ has four sets of drawers. Each company must meet at least one of the four sets of requirements, in addition to the main rules of all companies.
Entry requirements for all companies
Each company must have at least 1,250,000 shares listed on the stock exchange pending listing, except those that are owned by government officials, managers, or any final beneficiary of more than 10% of the company.
The normal offer price for a company's shares at the time of listing must be at least $4.00. However, the company may rate an alternative closing price of USD 3.00 or USD 2.00 low if the company meets different requirements.
There must be at least three (or four by standards) market makers per share. For companies using the $3 or $2 standard, only two market makers may be needed. It is also required that each listed company follow the corporate governance rules in NASDAQ 4350, 4351, and 4360.
Companies must also have at least 450 circular contracts (ie, 100 shares or more), 2,200 total contributors, or 550 total contributors, with an average circulation volume of 1.1 million in the last 12 months.
In addition to these requirements, companies must comply with all low standards with at least one of the following
Standard 1: Benefits
The company must have pre-tax gross earnings of at least $11 million in the previous three years, and at least $2.2 million in the previous two years, and no year in the previous three years could have a net loss.
Standard 2: capitalization by cash flow
The company must have a minimum total cash flow of at least $27.5 million during the past three fiscal years, with no negative cash flow in any of those three years. In addition, the average market capitalization during the prior 12 months must be at least $550 million, and prior fiscal year revenues must be at least $110 million.
Standard 3: Capitalization with Income
Companies can be eliminated from the second benchmark cash flow requirements if the average market capitalization over the past 12 months is at least $850 million and revenues during the previous fiscal year are at least $US 90 million.
