The Securities and Exchange Commission (SEC) has approved rule changes proposed by Nasdaq to enhance the enforcement of listing standards for companies trading on its exchange. The approved changes involve the suspension of trading for companies that have not met the minimum bid price requirement after a second compliance period, even if they appeal the decision. Additionally, Nasdaq will not allow a compliance period for companies that fail to meet the bid price requirement within one year of a reverse stock split. These changes are intended to protect investors by reducing the risk of manipulation and ensuring the integrity of the stock market, particularly by addressing issues with companies that repeatedly fail to meet listing standards.
Simple Explanation
Nasdaq has made a new rule that says if a company's stock price is too low for too long, the company can't trade its stock on the exchange anymore. This rule helps make sure everything is fair and keeps the stock market honest and safe for everyone.