NASDAQ introduced a new market in May 2011 for Smaller Reporting Companies called the NASDAQ Venture Market.
It is for companies with a strong business concept and market potential but because they do not fulfill the required financial requirements to list on a national securities exchange. Its listing requirements that are targeted to smaller and earlier stage companies.
While the BX Venture Market has lower financial listing standards than the major national securities exchanges, the corporate governance requirements are similar to those required for listing on them. The BX Venture Market provides a well regulated, transparent platform for companies to gain additional visibility in the investment community. Further, companies and their shareholders will benefit from superior trading technology, as well as a robust portfolio of products and services.
How does the BX Venture Market compare to the NASDAQ Stock Market?
NASDAQ |
BX |
|
| Registered under Section 12b of the Exchange Act | Yes | Yes |
| Disclosure of Materials compliant with Reg FD | Yes | Yes |
| Current in Annual and Quarterly Filings with the SEC | Yes | Yes |
| Comply with the Voting Rights Rule | Yes | Yes |
| National Securities Exchange | Yes | Yes |
| Direct Registration Program | Yes | Yes |
| Fully Independent Audit Committee | Yes | Yes |
| Code of Conduct | Yes | Yes |
| Annual Shareholders Meeting | Yes | Yes |
| Sarbanes Oxley and Dodd-Frank Compliant | Yes | Yes |
| Public Interest Review | Yes | Yes |
| Shareholder Approval for use of Equity Compensation | Yes | Yes |
| National Market System Securities | Yes | No* |
* Due to BX Venture Market’s lower financial listing standards, securities listed on the BX Venture Market will not be classified as National Market System (“NMS”) securities. This means that, the unlike the NMS securities listed on NASDAQ, securities listed on the BX Venture Market will not be subject to trade-through rules. These rules mandate that when a security is traded in more than one venue, transactions may not occur in one market if a better price is offered on another market. BX Venture Market listed securities are eligible to be traded on the over-the-counter markets. Trades completed in BX Venture Market securities will not be reported to the NMS consolidated tape plans.
Shareholder Approval for Share Issuance Yes No*
* Companies listed on the BX Venture Market are required to obtain shareholder approval for equity compensation. However, they are not required to obtain shareholder approval for other issuances of common stock. This differs from the rules applicable to companies listed on NASDAQ, which are also required to seek shareholder approval for any stock issuance of 20% or more at a price less than the greater of book or market value, any stock issuance that could result in a change of control, and certain stock issuances in connection with acquisitions.
Subject to Trade-Through Rules Yes No*
* Due to BX Venture Market’s lower financial listing standards, securities listed on the BX Venture Market will not be classified as National Market System (“NMS”) securities. This means that, the unlike the NMS securities listed on NASDAQ, securities listed on the BX Venture Market will not be subject to trade-through rules. These rules mandate that when a security is traded in more than one venue, transactions may not occur in one market if a better price is offered on another market. BX Venture Market listed securities are eligible to be traded on the over-the-counter markets. Trades completed in BX Venture Market securities will not be reported to the NMS consolidated tape plans.
Majority Independent Board Yes No*
*Companies listed on the BX Venture Market will need to have a fully independent audit committee with at least three members. Unlike companies listed on NASDAQ, however, they will not be required to have a majority of independent directors on their boards.
“Blue-Sky” Exemptions Yes No*
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