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New Capital Market at a glance

Friday 12th May 2000

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  • 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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