Initial Listing
The criteria for listing examination of convertible bonds are as follows.
- The issuer is a listed company
- Total nominal amount is JPY 2 billion or more
- The conditions of exercise of subscription warrants are not deemed inappropriate
We will also notify the Commissioner of the FSA of any new convertible bond (CB) listings.
Listing Supervision
Listing supervision of convertible bonds is largely focused on the exercise of subscription warrants associated with the convertible bonds.
When a listed convertible bond is exercised, there will be a decrease in the total listed nominal amount and an increase in the number of listed shares of the underlying stock at the same time.
Therefore, TSE receives monthly reports on exercise and changes the total listed nominal amount and the number of listed shares.
Issuers also report redemptions, retirement by purchase, changes in the conversion price, and other significant events to TSE.
Delisting
Convertible bonds will be delisted in the following cases.
- End of exercise period
- Total listed nominal amount falls below JPY 300 million
- Underlying stock is subject to delisting
Delisting date pertaining to the arrival of the final redemption date or expiration of the exercise period is as follows.
- 3 days (excluding non-business days) before the final day of the
period when exercise for the issue are handled by the designated book-entry transfer institution.
(Rule 917, Item 3 of the Enforcement Rules for Securities Listing Regulations)
Criteria for Listing Examination
Newly issued convertible bond
- An issuer of a security for which an initial listing application is made is a listed
company; and
- A security for which an initial listing application is made satisfies the following a.
through e.:
- The total nominal amount of a convertible bond is JPY 2 billion or more;
- The conditions of exercise of subscription warrants are not deemed inappropriate
pursuant to the provisions of the Enforcement Rules;
- Where such security is a convertible bond which is not handled in the book-entry
transfer operation of the designated book-entry transfer institution, the form of the
actual certificate of a convertible bond complies with the requirements specified by
the Enforcement Rules or a resolution has been adopted at the board of directors
such that the actual certificate of a convertible bond will be prepared in the form in
conformity with such requirements;
- Where such security is a convertible bond that can be handled in the book-entry
transfer operation of a designated book-entry transfer institution, such security is
subject to the book-entry transfer operation of the designated book-entry transferinstitution, or is likely to be so by the time of listing;
- Where such security is a convertible bond that can be handled in the book-entry
transfer operation of a designated book-entry transfer institution, the amount of face
value shall be any of JPY 5million, JPY 4 million, JPY 3 million ,
JPY 2 million, JPY 1 million, JPY 500,000, or JPY 100,000;
Delisting Criteria
- Where an issuer carries out a material breach concerning a listing agreement
pertaining to a convertible bond or where an issuer ceases to become a party to such
listing agreement;
- Where a stock, etc. issued falls under any of the criteria referenced in Rules 601
through 604-5 (excluding cases falling under the following item); or
- Where a listed convertible bond falls under any of the following items, it shall be delisted.
- Where the total listed nominal amount becomes less than JPY 300 million by the day a
month before the day on which the final redemption date arrives;
- Where the exercise period for a subscription warrant arrives at maturity;
- Where an issuer of a listed convertible bond loses the right of benefit of term with
respect to such security;
- Where such issue is a convertible bond that can be handled in the book-entry transfer
operation of a designated book-entry transfer institution, when such issue ceases to be
subject to the book-entry transfer operation of the designated book-entry transfer
institution;
Delisting date
The arrival of the final redemption date or the expiration of the exercise period
3 days (excluding non-business days) before the final day of the
period when the bond may be subject to the book-entry transfer operation
by a designated book-entry transfer institution.
In the case of delisting other than the above
The day when 1 month have lapsed from the day following the
day when the decision is made by the Exchange to delist such listed bond;
provided, however, the same shall not apply where the Exchange deems it
necessary to delist such bond promptly.