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Road map for an IPO

The Process of Going Public

At Big Ben, we provide companies that have reached a certain stage of maturity the option of listing on a leading European stock exchange. We have successfully raised capital and listed numerous companies with our partners in Europe, and have a broad range of contacts with the financial  markets.

Nordic MTF at NGM

Nordic Growth Market NGM AB operates as a subsidiary of Boerse-stuttgart AG and as a regulated stock exchange in Sweden. The company provides a Multilateral Trading Facility (MTF), a platform for trading in small and medium-sized entrepreneurial companies (www.nordicmtf.se); Nordic derivatives exchange (NDX), a market for listing and electronic trading of derivatives and structured products; and NGM Equity, which offers listing and trading in equities. It also approves and monitors companies on market, as well as distributes financial information, including press releases, reports, and corporate information.

Companies that apply for listing on Nordic MTF must undergo a listing process. This is done ensure that that the company and its management meet the requirements for due diligence and have systems in place for financial control and information dissemination, as well as that conditions exist for a fair, orderly and efficient trading.

Companies whose shares have already been traded on another exchange or marketplace may be eligible for a summary listing process.


Basic listing requirements with the Nordic MTF

The following requirements are the most important:
• A public company according to Swedish regulations;
• Registered with Euroclear the central securities depository (CSD);
• Must have enough shareholders (300) to support effective trading;
• At least 10% of its shares must be in public hands (float);
• At least four board members (two resident in the EEA);
• Information Memorandum (Company Description) with approved corporate information; and
• A corporate website with approved information.


Basic listing process with NGM

The listing process consists of the following steps:
• Preparation of company, ducuments and initial due diligence;
• Informal introduction to NGM
• Formal meeting between the company and NGM;
• Submission of listing application;
• Legal due diligence;
• Provisional decision by NGM communicated to the company;
• Financial due diligence initiated;
• Memorandum or Prospectus will be compleated;
• NGM examines the financial due diligence, memorandum or prospectus and other documents;
• Listing decision

NGM offer a very attractive mirror listing between Stuttgart and Stockholm. The trading of your securities on the Stuttgart Stock Exchange is made extremely attractive by the trading segments and initiatives, tailor-made specifically for private investors and the special features of the different classes of securities.

Stockholm (and Stuttgart) offers less cost, better liquidity, and greater access to capital than OTCBB in U.S.A. but we can offer a dual listing offer with OTCQX International for qualified companies.


Company Memorandum, or Prospectus

The Prospectus Regulation aims at providing issuers with tailor-made disclosure rules, while inducing, at the same time, the prospectus to be a more relevant tool of information for potential investors. The need for a revision of the previous regulation, arises from the growth in capital-raising on capital markets and the need, especially for SMEs, to participate in this growth.

The new Regulation also seeks to level the playing field by removing the existing differences between the rules applicable in different Member States. As long as disclosure of information is considered to be «vital to protect investors by removing asymmetries of information between them and issuers» 10, harmonisation of the disclosure regime should be the answer to the long–known concern of transparency for investors 11.

The Prospectus Regulation applies to both equity and non–equity securities offered to the public or admitted for trading on regulated markets.


The new obligation to publish a Prospectus

Offers to the public in Sweden where the total consideration is less than €2.5 million, are exempted from the obligation of drawing up a prospectus. This is because the costs of producing a prospectus are likely to be disproportionate to the «envisaged proceeds of the offer». However, Member States can ask for other disclosure requirements, if they don't constitute an unnecessary burden in relation to such offers of securities.

Considering the different sizes of financial markets across the Union, the legislator deemed it appropriate to give Member State the possibility of exempting offers of securities to the public not exceeding €8 million from the obligation to publish a prospectus. The threshold resulting from this provision, should thus vary, depending on the Member State, between €1 and €8 million. Beyond the threshold chosen, the drafting of the prospectus is mandatory. It is worth nothing that offers below the threshold cannot benefit from the pass–porting regime.

The prospectus should not be required for offers of securities to the public which are limited to qualified investors. Also, when an offer of securities is addressed to a restricted circle of not qualified investors (150 persons), no prospectus is required.

Finally, when an offer is addressed simultaneously to qualified investors and to non-qualified investors that commit to invest at least €100,000 each, the offer is exempted from the obligation to publish a prospectus.

When an issuer already has shares traded on a regulated market, any issuance of new shares of the same class on the same regulated market –provided that the newly admitted shares represent a limited proportion in relation to shares of the same class already admission– is exempt from the need to draw up a prospectus. The EU legislator increased the threshold from 10% to 20%: securities must represent, over a period of 12 months, less than 20% of the number of securities already admitted to trading on the same regulated market. This provision has entered into force on the 20th of July, 2017.



Stockholm is the leader

Going public in Sweden offer low costs and high liquidity. Want to know more about our cost-comparison of going public?

The Nasdaq Nordic exchanges have lately outperformed all European markets. What have been the drivers for this success? Want to know more about why?

Nasdaq First North

Nasdaq Stockholm AB operates as a subsidiary of NASDAQ Stock Market LLC and as a regulated stock exchange in Sweden.

Nasdaq First North was developed by Nasdaq Stockholm in 2006 as a marketplace for early-stage companies to grow both financially and organically. Nasdaq First North is regulated as a Multilateral Trading Facility (MTF), with more flexible listing requirements than the Main Market, thus enabling smaller companies to access the capital markets while realizing their growth potential (www.nasdaqomxnordic.com/firstnorth).

Launched in 2009, the Nasdaq First North Premier segment is designed to further assist companies in raising investor visibility and to prepare them for a Main Market listing. Nasdaq First North Premier targets companies that make a conscious decision to comply with higher disclosure and accounting standards than imposed under the Nasdaq First North rules.

Main Market. This is the flagship market in the Nordic region and is intended principally for well-established companies. The Main Market is an EU regulated market and, accordingly, its listing requirements are based on the applicable European standards (www.nasdaqomxnordic.com/).


Basic listing requirements with First North

The following requirements are the most important:
• A company duly incorporated or otherwise validly established according to the relevant laws of its place of incorporation;
• Registered with Euroclear the central securities depository (CSD);
• Local accounting standards, and for Premier IFRS;
• Must have enough shareholders to support effective trading. With fewer than 300 qualified shareholders, a Liquidity Provider would be required;
• At least 10% (25% on Premier) of its shares must be in public hands (float);
• On the Premier list the Market Cap must be €10 million or more;
• At the time of admission, the share price must be at least €0.50;
• At least four board members (two resident in the EEA);
• Company Description (Information memorandum) with approved corporate information; and
• A corporate website with approved information.


Profitability and Working Capital

The company must demonstrate that it possesses documented earnings capacity on a business group level. Alternatively, if the company does not possess documented earnings capacity, it must demonstrate that it has sufficient financial resources in order to enable it to conduct the planned business for at least twelve months after the first day of trading. The company must also clarify when it expects to be profitable and how the company intends to finance its operations until such time.


Company Description, or Prospectus

In connection with listing on Nasdaq First North, a company description or a prospectus must be prepared. The company description shall, inter alia, include a description of the issuer, its annual reports or financial statements for the last two years (if applicable), its Board of Directors and its most important agreements.
If the listing has been preceded by a public capital raise of more than 2.5 million Euro the company must instead of a company description prepare a prospectus.
If Sweden is the home Member State of the company, i.e. the company is incorporated in Sweden, or in case where the company is incorporated outside of the EEA, has chosen Sweden as its home Member State, the SFSA is responsible for granting the formal approval of the prospectus. In addition, the Exchange examines the prospectus in order to ensure that the prospectus provides the market with sufficient information in accordance with the requirements for admission.



Dual listing with OTCQX International

We offer a very attractive dual listing with the OTCQX International, for companies already listed on a qualified stock exchange and want access to the  U.S. market without the need to make filings with the SECC.

International issuers on the OTCQX must meet specified eligibility requirements.  Quotation is available for American Depository Receipts (ADR’s) or foreign ordinary securities of companies traded on a Qualifying Foreign Stock Exchange.

International issuers on the pinksheets are not required to be reporting with the SEC nor are they required to qualify for the Rule 12g3-2(b) exemption from SEC registration for foreign private issuers.  Pinksheets are available to ADR’s and foreign ordinary securities of companies traded on a Qualifying Foreign Stock Exchange.

Exchange Act Rule 12g3-2(b) permits foreign private issuers to have their equity securities traded on the U.S. over-the-counter market without registration under Section 12 of the Exchange Act (and therefore without being subject to the Exchange Act reporting requirements).  The Rule is automatic for foreign issuers that meet its requirements.  A foreign issuer may not rely on the rule if it is otherwise subject to the Exchange Act reporting requirements.

To be eligible to be quoted on the OTCQX International, companies must:

  • Have U.S. $2 million in total assets as of the most recent annual or quarter end;
  • As of the most recent fiscal year end, have at least one of the following: (i) U.S. $2 million in revenues; (ii) U.S. $1 million in net tangible assets; (iii) U.S. $500,000 in net income; or (iv) U.S. $5 million in global market capitalization;
  • Meet one of the following penny stock exemptions under Rule 3a51-1 of the Exchange Act: (i) have a bid price of U.S. $5 or more; or (ii) have net tangible assets of U.S. $2 million if the company has been in continuous operation for at least three years, or U.S. $5,000,000 if the company has been in continuous operation for less than three years; or (iii) have average revenue of at least U.S. $6,000,000 for the last three years;
  • Be quoted by a market maker on the OTC Link (which requires a 15c2-11 application if the company is not already quoted on a lower tier of OTC Markets);
  • Not be in bankruptcy or reorganization proceedings;
  • Be included in a Recognized Securities Manual or be subject to the reporting requirements of the Exchange Act;
  • Have its securities listed on a Qualifying Foreign Stock Exchange for a minimum of the preceding 40 calendar days; provided, however, that in the event the company’s securities are listed on a non-U.S. exchange that is not a Qualified Foreign Stock Exchange, then at the company’s request and subsequent to the company providing OTC Markets Group with personal information forms for each executive officer, director, and beneficial owner of 10% or more of a class of the company’s securities and such other materials as OTC Markets Group deems necessary to make an informed determination of eligibility, OTC Markets Group may, upon its sole and absolute discretion, consider the company’s eligibility for OTCQX International;
  • Meet one of the following conditions: (i) be eligible to rely on the registration exemption found in Exchange Act Rule 12g-2(b) and be current and compliant in such requirements; or (ii) have a class of securities registered under Section 12(g) of the Exchange Act and be current in its SEC reporting requirements; or (iii) if such company is not eligible to rely on the exemption from registration provided by Exchange Act Rule 12g3-2(b) because it does not (A) meet the definition of “foreign private issuer” as that term is used in Exchange Act Rule 12g3-2(b) or (B) maintain a primary trading market in a foreign jurisdiction as set forth in Exchange Act Rule 12g3-2(b)(ii), and is not otherwise required to register under Section 12(g), be otherwise current and fully compliant with the obligations of a company relying on the exemption from registration provided by Exchange Act Rule 12g3-2(b).

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Big Ben Venture Partners Ltd

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London EC2V 6AA

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