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BBX Exchange to Replace OTCBB
The Nasdaq Bulletin Board Exchange, known as the BBX, is scheduled to replace the Over the Counter Bulletin Board, or OTCBB, in early 2003. Most current OTCBB listed companies are expected to trade on the BBX. The BBX will utilize a fully automated trading and quotation system and offer greater protection to investors by bringing listing standards more in line with the Nasdaq National Market and the Small Cap Market, but will not require the financial or minimum shares price standards of these markets. Issuers who do not meet the BBX's requirements will have to trade through more informal methods such as the PinkSheets. Nasdaq will continue to operate the OTCBB for six months after the launch of the BBX to insure a smooth transition. Listing Requirements of the BBX
The BBX's listing requirements, which differ significantly from current OTCBB requirements, include:
- At least one market maker, 100 round-lot shareholders and 200,000 shares in the public float;
- Additional public interest standards, resulting in, among other things, a review of all directors, officers and major shareholders by the BBX for past regulatory or legal issues;
- Annual shareholder meetings, proxy solicitations and a quorum at meetings, distribute annual reports and make available quarterly reports to shareholders;
- Appoint at least one independent director within 12 months if the board does not have any independent directors at the time of listing on the new exchange;
- Create and maintain an audit committee, a majority of which must be composed of independent directors, and adopt an audit committee charter;
- Audit peer review consistent with the American Institute of Certified Public Accountants procedures; and
- Shareholder approval of transactions such as a plan or arrangement providing for the grant of stock options to officers and directors, large below-market issuances of stock, acquisitions and changes in control.
Applying for Listing on the BBX
Listing kits for the BBX will be available on its website upon approval of the BBX's listing requirements by the Securities and Exchange Commission. A sample listing application is currently posted on this website. All trading symbols for the BBX will begin with the letters XB followed by three letters chosen by the listed company.
If you would like more information regarding the Nasdaq BBX, or assistance in applying for listing on the new exchange, please contact any of our securities lawyers:
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