NASDAQ Requirements Delisting Considerations Here are some examples NASDAQ sees as suitable to maintain its position on the exchange:
For companies that have been cited for failure to meet the stockholders' equity requirement, what are some examples of plans of compliance that have been accepted by Nasdaq?
A company listed on the Nasdaq Capital Market
provided a definitive agreement for an asset sale, which would raise $50 million in the near term. Based on a pro forma balance sheet, after accounting for projected net losses, the company would have equity of more than $15 million immediately after the transaction and more than $10 million at the end of the fiscal year, in excess of the $2.5 million requirement. A company listed on the Nasdaq Global Market
announced its intention to complete a public offering in the near term and provided a press release announcing the pricing of an underwritten firm commitment public offering. Net proceeds of the offering were expected to be approximately $40 million. Subsequently, the company filed a pro forma balance sheet, adjusted to reflect the public offering, showing stockholders equity of approximately $45 million, in excess of the $10 million requirement. A company listed on the Nasdaq Global Market stated that certain holders of the company's warrants had exercised 500,000 warrants for proceeds of $12 million. Staff had concerns with the company's ability to sustain compliance based on the company's history of losses. In that regard,
the company provided definitive agreements from the warrant holders relating to the exercise of additional warrants, which when exercised, would result in proceeds to the company of $5,000,000. Based on the exercise, the company stated that stockholders equity had increased to approximately $22 million, on a pro forma basis, in excess of the $10 million requirement.
A company listed on the Nasdaq Global Market announced the acquisition of a target company shortly after receiving notice from Nasdaq that it was not in compliance with the $10 million minimum equity requirement. Therefore, the company believed that it had already achieved compliance with the minimum equity standard and anticipated that it would be able to file audited financial statements and pro forma financial information to reflect compliance within two weeks.
In other words, Neovasc's recent events such as the amended warrants, mixed shelf prospectus and options are part and parcel to the strategy Fred intends to bring to the NASDAQ Board's attention. Everything you see up to this point, which is falling in line to maintaining it's requirements with the exchange including the full disclosure regarding its forward looking statements (another specific and important requirement informing the public of a failing possibility) is in line. Fred will have his extension, he’s done everything required by the exchange.