FSE LISTINGS

Companies are applying for FSE Listings instead of listing on other exchanges for a number of reasons. Companies from different parts of the world have decided to list on the Frankfurt Stock Exchange because of its ease of listing. Another important benefit is the low cost of listing, especially when compared to listing on other exchanges like those in the United States, Hong Kong, South Africa and even Australia. Our team not only assists you in making the process as easy and straight forward as possible, but also helps keep your costs to a minimum and can in some situations offer funding once the company completes its FSE Listing.

FSE Listings usually take two or three weeks. Costs range from about $60,000-$175,000. The cost can be higher in some situations depending on whether or not the company requests additional services. Additional services are extremely important. They include road shows, marketing materials, investor relations, website development, press release distribution, online conferences and even introductions to capital sources are important. Some level of these additional services is necessary so potential investors are informed about the company and its stock can begin to trade in the public market.

Give me a call if your company is considering an FSE Listing. I would be glad to assist you in the listing process and our team can answer all your questions. I can also make introductions to capital in case you are seeking some equity funding. There are a number of factors you should consider before making your decision. It is better to be prepared and consider all the issues in advance. Make sure that your management team is prepared and has the information it needs.
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There are also no registration statements required for shares that are issued to investors. This becomes an important consideration for a management team deciding where to list their company . so they can attract interested Most investors want liquidity in their investment and FSE Listings are proving to be quite attractive to companies looking to raise growth and expansion capital.

If your company is already listed, or about to complete its FSE Listings process, additional information can be found here regarding funding for FSE Listings. If you have any questions about this information please feel free to call me.

Key Benefits of FSE Listings

• Low-Cost

One of the main reasons companies seek FSE Listings is the low cost of obtaining such a listing. Most companies seek a public listings to make it easier for them to raise capital so they don't want to spend a large amount of cash that could otherwise be used to buy equipment, increase marketing efforts or make an acquisition. This low cost advantage is a main factor when a company’s board of directors examines the listing cost, compliance expenses and yearly maintenance fees, which are far less than the costs of say listing in the United States. Also, as stated above, since there are no registration requirements for the shares being issued to investors in a private placement or equity line funding structure, this becomes an important consideration for a management team deciding where to list their company .

• Low Annual Maintenance Cost
The cost of maintaining FSE Listings is relatively low, especially when compared to the cost and expense involved in the United States to comply with the Sarbanes Oxley Act as well as the cost of filing registration statements that will most likely be required by private and institutional investors interested in making an investment into your listed company.

• Active Trading Market
FSE Listings can provide listed companies with a very active trading market if the company has enough news to put in the marketplace, can achieve consistent milestones and increase its gross and net revenues each year. Although a listed company on any exchange usually needs to do some form of investor relations and road shows to promote their company to interested shareholders, many investors look for companies on the Frankfurt Stock Exchange, so there is very good liquidity for many companies. I have met with several investor relations firms in Frankfurt and can help you in your decision on who to use and what services you should be looking for to help increase the visibility of your company. This is very important so that interested investors understand where your company is currently in relation to its competitors and where it is headed if it achieves its goals.

• Start-up Companies – A Tough Road

One general rule of thumb that applies, and of which I am a firm supporter, is that start-up companies should not get listed on any public stock exchange. There are exceptions to the rule of course, which I list below. Over the years I have seen many companies complete FSE Listings . I have seen success and failures in the process, with most of the failures being attributable to start-up companies with no revenues.
My advice to start-up companies is to build their business first. Prove that your business model works first by showing you can generate gross revenues, even if you can't show a net profit in the first year or two of operations. Your executive summary should explain how your business can expand and be highly profitable if it raises the necessary funding.

Many businesses are scalable and investors can quickly understand the growth potential that goes along with such a business model. These types of businesses usually attract investors because the business model is easy to understand and has very good growth potential. Deciding on an FSE Listing is usually a good decision with this type of business, but the company needs to have a good management team and a strong commitment to the listing process.

• Start-ups Not Welcome – Exceptions to the Rule
Like most rules, there will always be exceptions. Here are some possible exceptions if you are a start-up company and simply can't be talked out of a Frankfurt stock exchange listing.

• Exception Number 1 - Established Management Team with a Track Record of Past Successes

Depending on a company's business model and source of funding a start-up company with a strong management team might decide to get listed or do a reverse merger. If that is the case the company should try to line up its funding even before the listing process takes place. Perhaps they even get bridge loan funding Bridge Loan Funding to cover the cost of listing, investor relations and some funding to execute the first phase of their business plan.

• Exception Number 2 - Start-up with Listing Required by Investor

Occasionally I have been involved in transactions in which the company is required to be listed on a public exchange in order to access available capital. Some investors may actually require the company to complete an FSE Listing before they provide the agreed upon funding amount. One of the reasons for the listing requirement is that the investors need to have an"exit strategy" so they can get a return on their investment or at least liquidate a portion of their investment.

This of course requires a trading market for the company's shares and this can sometimes take several months to develop. Developing a trading market for the company's shares often requires a good investor relations program. A good investor relations program usually will include some or all of the following: road shows, good marketing materials, company snapshots, analyst reports, a professional corporate website, Internet social media marketing and Internet video conferencing.

• Exception Number 3 - Mining Companies
If your company is a mining company often investors may be attracted by the sector or type of mining the company is doing or even the country in which the mine is located. Also, investors in mining companies look carefully at the management team. This can even be true even if the mining company is only exploratory with no revenues, which is often the case. There are many mining companies that are exploratory with no revenues. They basically prove out the value of the mine were site by testing and proven samples. If the mind or site proves valuable enough the stock may achieve a fair price in the marketplace with good liquidity. The goal at this point is either to get a buyout from a major mining company or raise additional capital and move from being simply an exploratory or development stage mining company to an operating mining company.

• Exception Number 4 - Companies That Have a Valuable Asset

Maybe your company is a mining company with a mining lease to property with a good probability of valuable reserves. Another example of a company with a large and valuable asset would be one that has either a patent with worldwide applications or a technology that has worldwide applications for a large revenue stream. These are examples that investors are very interested in and will likely invest, provided they are given accurate information and the stock is reasonably priced. These types of companies are also good choices for why the pursue FSE Listings and obtaining funding to execute their business plans.

Reporting and Filing Requirements
There are certain reporting requirements and time periods for filing. These rules are established by the Frankfurt Stock Exchange (Borsenordnung) pursuant to its Exchange Rules. Issuers admitted to trading on the Prime Standard are required to publish annual, semi-annual and quarterly financial reports pursuant to the Securities Trading Act.

According to the Securities Trading Act and the Exchange Rules, foreign issuers are generally required to only publish their financial reports in English.

Another important point to remember is that the German Federal Financial Supervisory Authority (BaFin) may grant certain non-EU/EEA issuers exemptions from the reporting requirements under the Securities Trading Act if such issuer is subject to equivalent requirements in a non-EU/EEA state.

As you can see there are a number of benefits and advantages to FSE listings, such as low cost, good liquidity, easy and well respected. You must, however, be careful in choosing the right FSE Listing Partner since you do not want to pay too much and be stuck with a group that is not professional, lacks credibility and just gets things wrong.

The same is true of selecting the right investor relations firm. There are a number of investor relations firms that will help companies get exposure to the capital markets. The goal is to increase trading volume and liquidity, while at the same time broadening the shareholder base. I have met with a number of investor relations fimrs in Frankfurt and have met with many more in the United States. Most IR firms use the same basic approach, but you need to know which ones to be careful of that can do more harm than good. Reputation and contacts are everything. Give me a call if you would like to discuss further.

It is not the goal of the investor relations firm to increase share price. Increasing share price is more of a function of the success of the company. It requires the company to meet its goals and provide a steady stream of news and success stories to its shareholders and potential investors. As the company increases its gross revenues and net income the share price should steadily climb as more and more investors purchase the company's shares.

Please contact me if you are interested in a Frankfurt Stock Exchange Listing and I can save you significant expense, time and aggravation. By the way, FSE Listings are also referred to as a Deutsche Borse Listing or a Deutsche Boerse Listing, so these terms are the same and used interchangeably by many people.

Links for further information on the Frankfurt Stock Exchange can be found below:

You might find this information useful, here is the link for the "Deutsche Boerse AG Website", which is the marketplace organizer for the trading of shares and other securities on the FSE.

Additional information on the Deutsche Borse can be found at "Deutsche Borse - Wikipedia" for Stock Quotes, news, events, watch list (portfolio trading).

You can also find information on the Xetra electronic trading platform which can be found at "http://www.boerse-frankfurt.de".