SEC© Approves Tough New Rules for Reverse Mergers

Today, the SEC© approved new rules that make it more difficult for companies to go public through a reverse merger and list on the Nasdaq, NYSE, and NYSE Amex exchanges.

Under the new rules these three exchanges will impose tough new listing requirements for companies that become public through a reverse merger. In general, companies would be prohibited a company to list until they until:

• The company has completed a one-year “seasoning period” by trading in the U.S. over-the-counter market or on another regulated U.S. or foreign exchange following the reverse merger, and filed all required reports with the Commission, including audited financial statements.

• The company maintains the requisite minimum share price for a sustained period, and for at least 30 of the 60 trading days, immediately prior to its listing application and the exchange’s decision to list.

The full press release is available at: http://www.sec.gov/news/press/2011/2011-235.htm

An SEC© investor alert issued prior to the new regulations is available at: http://www.sec.gov/investor/alerts/reversemergers.pdf