What can you buy for 10 cents these days? A single-use grocery bag? Maybe a single Jolly Rancher? What about a share of a listed company’s stock? Maybe. But Nasdaq is trying to change that in what appears to be a broader effort to do some listed company clean-up.

Last week, the SEC posted this notice and request for comment for proposed changes to Nasdaq’s minimum bid price rules. The combined effect of these proposed changes is to accelerate the delisting determination and trading suspension of a security if its bid price quickly declines from above $1.00 to below $0.10. Here’s how:

Delisitng Determination: Under the current rule, if a security has a closing bid price of $0.10 or less for 10 consecutive trading days, Nasdaq issues an immediate delisting determination (notwithstanding any otherwise available compliance period) only AFTER a company’s security is already non-compliant with the $1.00 minimum bid price requirement (which happens once the security has traded below $1.00 for 30 consecutive days). With the proposed changes, Nasdaq rules would require an immediate delisting determination (and ineligibility for any compliance periods) when a security does not maintain a closing bid price of greater than $0.10 for 10 consecutive trading days whether or not the company is first non-compliant with the $1.00 bid price requirement for 30 days.

Trading Suspension: Generally, a timely request for a hearing will stay the suspension and delisting of a security pending the issuance of a written panel decision. Nasdaq proposes to except securities that trade at less than $0.10 for 10 consecutive trading days from this general rule so that a company that is suspended under the proposed rule could appeal the delisting determination to a Hearings Panel, but its securities would trade in the over-the-counter (OTC) market while that appeal is pending. The proposal also clarifies that compliance is achieved once the security trades at least $1.00 for a minimum of 10 consecutive business days, unless Staff exercises its discretion to extend the 10 business day period pursuant to its authority to do so.

Nasdaq says these proposals are meant to more quickly boot securities from the exchange in situations that are “indicative of deep financial or operational distress within such company, and that the challenges facing such companies, generally, are not temporary and may be so severe that the company is not likely to regain compliance.”

The SEC is seeking comments on the proposal, which Nasdaq proposes to be operative 45 days following Commission approval.

– Meredith Ervine