Nasdaq Small Cap continued listing requirements:
smallcapinvestor.com
Summary of minimum requirements for continued listing, effective February 23, 1998:
Net tangible assets of $2 million, or market capitalization of $35 million, or $500,000 in net income for two of the last three years
Public float of 500,000 shares
$1 million market value for the public float
300 shareholders
$1 minimum bid price
Two market makers
Corporate Governance Standards(see initial listing requirements)
Notes:
Net tangible assets are total assets less total liabilities and goodwill
The public float consists of shares that are not held directly or indirectly by any officer or director of the issuer and by any other person who is the beneficial owner of more than 10 percent of the total shares outstanding.
A company is not in compliance with this requirement when its stock drops below $1 for 30 trading days. The company will be notified of delisting proceedings unless the stock closes at $1 or more for 10 consecutive trading days, within 90 calendar days of falling out of compliance.
And this:
smallcapinvestor.com
Under the new rules, a company is not in compliance with the minimum price requirement when its stock drops below $1 for 30 trading days.
Specifically, what will happen on February 23? According to Nasdaq spokesman Reid Walker, some companies will be notified immediately about delisting proceedings, while others will be given time to get back into compliance, depending on which listing requirements were not met. For example, a Nasdaq SmallCap company not meeting the new corporate governance standards would probably be notified immediately concerning delisting proceedings, while a company not meeting the minimum $1 bid price would be given more time. Companies notified about delisting proceedings can request a hearing with Nasdaq which could buy more time to get back into compliance.
Two of the significant changes for The Nasdaq SmallCap Market are the corporate governance standards, which had applied only for the Nasdaq National Market, and the minimum $1 bid price. Previously, a stock could trade under $1 as long as it met alternative requirements. These alternative requirements will no longer exist. Under the new rules, a company is not in compliance with the minimum price requirement when its stock drops below $1 for 30 trading days. The company will be notified of delisting proceedings unless the stock closes at $1 or more for 10 consecutive trading days within 90 calendar days of falling out of compliance.
Beginning February 23, Nasdaq will look at the previous 30 trading days for stocks under $1 during that time. The 90-day clock for getting back into compliance begins after trading below $1 for 30 days, even if some of those 30 days were before February 23. The clock begins immediately for stocks which were under $1 for the 30 days prior to February 23. To avoid delisting due to stock price, many companies will use reverse splits to increase the price of their shares. But this will work only if the company meets all the other requirements as well. Also, companies that implement a reverse split often suffer stock price declines.
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As far as I can see they shouldn't be delisted for being under $1.00 unless 30 Trading Days is really 30 Days!
Mike
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