Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Joe Copia's daytrades/investments and thoughts -- Ignore unavailable to you. Want to Upgrade?

To: Sheri who wrote (1583)	5/2/1998 9:00:00 AM
From: Joe Copia	Read Replies (2) \| Respond to of 25711

Thanks Sheri ! Some familiar tickers in that list. Now another important factor in the new NASDAQ rules is WHEN? they have to maintain per the new rules. New rules follow. I recommend everyone KNOW what it says before the deadlines. Joe PTG&LI !!! NEW NASDAQ CONTINUED LISTING REQUIREMENTS Beginning February 23, 1998, new continued listing requirements go into effect for Nasdaq stocks. What does this mean for you and any small-company stocks in your portfolio? Nasdaq stocks that don't meet the new requirements - usually very small companies - could sink to the murky netherworld of the OTC Bulletin Board (OTCBB). These stocks often suffer a decline in stock price and decreased liquidity. Additionally, the companies will no longer have to meet any Nasdaq qualitative and quantitative requirements. Although investors seldom view the demotion to the OTCBB as a favorable development, with many brokerages you can still trade OTCBB stocks just like Nasdaq stocks, so you don't have to worry about whether you will be able to sell your OTCBB stocks. However, with some brokerages this could be a problem. If you have any stocks in danger of being delisted, you may want to check with your brokerage to find out whether they will trade OTCBB stocks. How can you tell if any of your Nasdaq stocks don't meet the new requirements? Click here to view the list of new requirements which is available on our website. Make sure you look at the requirements that will go into effect on February 23, 1998. (The previous requirements are also provided for comparison.) In addition, you need to differentiate between the requirements for The Nasdaq SmallCap Market and the generally larger companies of the Nasdaq National Market. To see if your stock meets the requirements, you can look at the company's latest financial statements filed in the SEC's EDGAR database at: sec.gov. 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. Nasdaq National Market stocks that don't meet the new continued listing requirements likely will wind up on either The Nasdaq SmallCap Market or the OTC Bulletin Board. In order to move to The Nasdaq SmallCap Market, according to Nasdaq officials, the company would have to meet the initial listing requirements of The Nasdaq SmallCap Market rather than continued listing requirements. However, Nasdaq seems willing to waive certain initial listing requirements on occasion (such as minimum price), as long as the company can eventually meet continued listing requirements.