Part S LongTerm Financing 472 WEB EXERCISE This chapter on c

Part S Long-Term Financing 472 WEB EXERCISE This chapter on capital markets focuses on long-term financing and the various stock markets. Each stock market has its own listing requirements, and this e cise will look at the New York Stock Exchange listing requirements and listing fees. Students interested in repeating this exercise for NASDAQ may easily find the same information at www.nasdaq.com Go to the New York Stock Exchange\'s website at www.nyse.com. Scroll to the bottom of the page and under U.S. Equities, click \"Listings.\" In the U.S. Equi- ties page, highlight \"Listings\" and in the drop down under \"How to List with the NYSE,\" click \"NYSE Domestic Listing Standards.\" Scroll down to see the nec- essary information. Answer the following questions about being listed: a. How many round lot holders (100 shares) are necessary? b. How many public shares are necessary? c. What are the Market Value Criteria? d. What is the Alternative #1 Earnings Test? 1. xer- 2. Note: Occasionally a topic we have listed may have been deleted, updated, or moved into a different location on a website. If you click on the site map or site index, you will be intro you in finding the topic you are looking for. oduced to a table of contents that should aid

Solution

As per the domestic listing standard:

a. 400 round lot are necessary

b. 1.1 Mn public shares are necessary

c. Market value for close-end management investment companies and business development companies should be $60Mn. While for all other type of companies the market value criteria is as follows:

1. IPOs, Spin-off and carve outs : - $40Mn

2. All Other listings - $100Mn

d. As per earnings test, to qualify for listing, the adjusted pre-tax income aggregate for last three years should be a minimum of $10Mn, each of the two most recent fiscal years should be minimum $2Mn and each of prior three years should be greater than or equal to $0. The adjustment includes exclusion of one time gains or losses. For example, costs related to fund an acquisition, M&A activity, R&D, non recurring charges, impairment charges, gains or losses from sale of a subsidiary or investee\'s stock.