New Capital Market at a glance

Friday 12th May 2000

NCM companies come to the market issuing only a single class of share.
The maxiµmum amount which can be raised by the IPO is $600,000.
Organising brokers arrange, before listing, at least 300 shareholders to hold no more than 2% each, raising a total amount of between $400,000 and $600,000.
Every NCM must have at least three directors. The directors are the promoters.
Promotors must invest their own cash of between $200,000 and $600,000.
Promoters will be issued shares at $0.25 and the public in the IPO at $0.50.
The NCM company will be listed for trading as a "cashbox" shell.
The promotors may already have a prospective key transaction in mind but in other cases the NCM company could be a pure cashbox looking for an investment.
The key transaction is subject to an independent valuation and audit report.
The key transaction can be made by issuing more shares to the public for cash, or by issuing shares for the key transaction business or assets.
Promoters can sell down their shares each year one-third at a time.

No more than 30% of invested funds can be spent on administration before the key transaction.

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