I’m attorney Laura Anthony founding partner
of Legal & Compliance, a full service corporate,
securities, and business transactions law
firm.
Today is the final segment in a multipart
LawCast discussing OTC Markets and in particular
the different quotation levels and listing
criteria for each level.
Today I’m continuing my discussion on the
OTC Pink marketplace and quotation criteria.
The OTC Pink, which includes the highest-risk,
most speculative securities, is further divided
into three tiers: Current Information, Limited
Information and No Information, based on the
level of disclosure and public information
made available by the company either through
the SEC or posted on OTC Markets.
There are no qualitative standards beyond
disclosure for OTC Pink companies, which include
companies in all stages of development as
well as shell and blank check entities.
I have already discussed the current information
and limited information levels of OTC Pink.
Companies with No Information status on OTC
Markets are generally delineated by a “stop”
sign and do not provide any current or updated
reliable public disclosure.
There are a couple additional OTC Market designations
to be made aware of.
The first is caveat emptor.
Companies with a Caveat Emptor designation
on OTC Markets are delineated with a skull
and crossbones sign.
These companies have raised concerns such
as improper or misleading disclosures, spam
campaigns, questionable stock promotion, investigation
or fraudulent or other criminal activity,
regulatory suspensions or disruptive corporate
actions.
While labeled with a skull and crossbones,
a company that does not have Current Information
or is not on the OTCQB will have its quote
blocked on the OTC Markets website.
As an experienced OTC Attorney I can confidently
state that details determine diligence and
the best way to deal with a Caveat Emptor
designation is not to incur one to begin with,
really.
It is imperative that Pink Sheet Companies
operate with crystal clear transparency and
strict adherence to all regulatory responsibilities.
Companies labeled as Other OTC or Grey Market
are delineated by a grey yield sign.
These companies do not have a current 15c2-11
on file and not eligible for quotation by
a market maker or broker-dealer until such
time as a 15c2-11 application is made with
and accepted by FINRA.
I’m securities attorney Laura Anthony, founding
partner of Legal & Compliance.
Should you have any questions about today’s
topic, please visit SecuritiesLawBlog.com,
and LawCast.com, or contact me directly.
Inquiries of a technical nature are always
encouraged.
